The Gillette Guard was the result of what Alberto Carvalho, vice president, glob

Question

The Gillette Guard was the result of what Alberto Carvalho, vice president, globel Gillette, described as a focus on not only producing razor that would meet the needs of these consumers, but doing it at "ruthless cost." This meant paying attention to the smallest details, designing a stripped down single blade razor with only four comments versus the 25 found in more sophisticated razors. Jim Keighley, associate director for product engineering, says I can remember talking about changes to this products that were worth a thousandth, or two thousandths of a cent" In the end they were able to produce a razor that cosy one third of the previously introduced Vector. Selling price for the Gillette Guard ended up at 15 rupees (34 cents) and the razor blades at 5 rupees (12 cents). As a result of their painstaking research and attention to the needs of this unique target audience, P&G;'s market share for razors and blades has grown significantly in india and at a faster rate than any other P&G; brand in India. Despite the challenges they encountered it appears that the Gillette Guard can be considered a bottom of the pyramid success story DISCUSSION QUESTIONS 1. Using the 4A's framework -Chapter 12, analyze the considerations that went into the development of the Gillette Guard razor for the Indian market Are companies targeting the bottom of the pyramid taking advantage of vulnerable consumers with limited resources 2. 3. More than half of US, workers earn less than $30.000 a year, barely above the poverty line for a family of five. What would you recommend to a company looking to target the bottom of the pyramid consumers in the United States?

Explanation / Answer

Question:- Using the “4A’s” framework in Figure 12.1, analyze the considerations that went into the development of the Gillette Guard razor for the Indian market.

            To start with, let’s remind what is the “4A’s” framework. The 4A’s are the following: The awareness which promote offering through a mix of outlets and to form partnerships with public and non-governmental organizations. The acceptability which focus on customers’ development and to establish local R&D. The affordability in order to reduce packaging size for low price per unit and to maintain operations on zero working capital. Finally, the availability which reduce cost serve, shortern supply chain and select support retailers. In order to succeeded in India, P&G did some research according to the “4A’s” framework. According to the case: “They asked the men about their shaving rituals and observed them in the process of shaving. What P&G found is that they typically shave on the floors of their huts with no electricity, using a bowl of water and no mirror. Their primary objective is to avoid cutting themselves”. Based on that, Gillet came up with the Guard razor, it costs 15 rupees (34cents). We can definitely say that Gillet Guard is considered as a pyramid success story.

Question:- Are companies targeting the bottom of the pyramid taking advantage of vulnerable consumers with limited resources?

Companies are definitely targeting the bottom of the pyramid in order to take advantage of vulnerable consumers. According to the case: “a number of companies have attempted to make this model work. Puriet, an in-home water purification system manufactured by Hindustan Unilever Limited, was developed for low- income consumers and has found success by offering a 6-month installment plan to make the $25 price more manageable”. Based on this example, we can clearly notice that Puriet has taken advantage of vulnerable consumers.

Question:- More than half of U.S. workers earn less than $30,000 a year, barely above the poverty line for a family of five. What would you recommend to a company looking to target the bottom of the pyramid consumers in the United States?

            In my opinion, the company should pay attention to what can be useful for U.S. workers at a convenient price. We all know that American likes watching TV. Therefore, a tech company can take this business opportunity and sell convenient TV at a cheap price in order to target low income U.S. workers. But to achieve that, the company will have to go through several steps. The first one is to do a market survey based on daily habits of the workers. Then, see how they react to the TV concept that the company wants to introduce. Finally, the company will have to look at the affordability in order to reduce some costs that are linked to the TV such as packaging.

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