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Gillette charts its own course.

BOSTON - Things have been heating up in the antiperspirant and deodorant markets. Manufacturers competing for their shares of the $1.6 billion category have been aggressively searching for ways to capture loyal consumers. Over the past three years the top antiperspirant/deodorant suppliers have made an all-out assault, introducing 26 major products or line extensions.

The good news is that all of that activity has fueled a healthy expansion in this historically slow-growth category. In 1994 total antiperspirant/deodorant sales reached 657 million units, up 6% from 1993, according to Nielsen data. Of that total new products generated a phenomenal 93 million units, or 14.2% of the category's total consumer sales in 1994.

Most of that new product activity was focused on the sticks/solids segment, which continues to dominate the antiperspirant/deodorant market with 65% of total unit sales. The unfortunate thing for most manufacturers is that they have the same strategies as many other suppliers.

Many different brands were battling for the same nonloyal consumers. The net result was a great deal of product clutter and only partial success. Total unit sales of antiperspirant solids were up 11.2% in 1994, while total unit sales of deodorant sticks declined 1.1%.

While most of the activity focused on building the sticks/solids segment, Gillette Co., one of the top antiperspirant/deodorant manufacturers, took a totally different tack to lift sales and profits. Instead of following the crowd, the company decided to chart new territory and embarked on an aggressive, technologically based strategy with its new clear gels.

"The sticks/solids segment continues to offer the greatest unit potential, but the highly competitive nature and recent competitive pricing activity in this segment forced us to create a more unique approach," explains David Bashaw, marketing director of Gillette's personal care products division.

"We wanted to define a product strategy that would accomplish two critical goals," Bashaw explains. "First, we wanted to fill a key consumer need by developing a product that provides effective antiperspirant protection without leaving white residue. That's something that we believe was not yet available.

"Second, we wanted to bring value back into the category, which was being eroded by the devaluation of the sticks/solids segment. We believed that this was a critical issue for many retailers that had to be addressed."

Gillette's emphasis on its clear gels has clearly paid off. The products, which were launched in 1993 and 1994 across the Right Guard, Soft 'N Dri, Dry Idea and Series franchises, have made the company the fastest-growing antiperspirant/deodorant manufacturer in the marketplace, according to Bashaw. In 1994 Gillette achieved a record 19.4% dollar share of the category, adding 1.9 share points versus 1993.

The supplier's gains last year were significant. Fueled by the clear gels, Gillette outpaced its key rivals, which each picked up less than 1 share point. Other manufacturers in the category saw their pieces of the market decline as well.

And Gillette's clear gels continue to perform well in 1995. The year-to-date dollar share for the products through April reached 6.4%.

Personal care products division vice president of sales Joe Weatherton claims that success is being driven by two profitable dynamics. "For every stick/solid user that trades up to our gels, we increase the retailer's total sales and profits through higher register rings and increased turns," he notes. "The average retail price of our gel is $2.43, while the average retail price of a stick/solid is $1.98.

"By trading consumers up to gels, we increase retail sales by an average of 18%. In addition, due to the product dynamics of the gels, the consumer use-up rate is 1.75 times faster than with sticks/solids. That generates about three or four incremental purchases by each consumer annually."

Weatherton believes that Gillette has created a win-win situation. Consumers have an effective product that fills a core need, and retailers are able to increase overall sales and profits efficiently.

The company's success in charting new territory is not unexpected. In 1960 it was the first manufacturer to introduce an aerosol (Right Guard). In 1978 it was the first to launch a dry aluminum chlorohydrate-based roll-on product (Dry Idea).

The dominance Gillette has enjoyed in the razors and blades category is also well-known. Its recent technological advances there include the Sensor, Sensor for Women and SensorExcel saving systems.

The company's aim is to revitalize the aerosol and roll-on segments of the antiperspirant/deodorant market, which make up 16% and 13% of the category, respectively.

"As you research the trends and consumer dynamics of these two segments, you realize that you have to take a totally different growth strategy than what's being employed with gels or sticks/solids," states Bashaw. "Aerosol and roll-on users tend to be older, more loyal and less likely to switch brands or product forms than stick/solids users. Therefore, you want to adopt a loyalty/reward strategy to grow your business, rather than launch products or line extensions."

Based on the consumer dynamics of the two segments, Gillette's strategy has been to focus on marketing efforts that target loyal users. "Through our market research, we have identified where the core aerosol and roll-on users live, where they shop and what promotions generate their interest," remarks Bashaw.

And Gillette executives believe that this targeted strategy is the most efficient and profitable way of maintaining a strong position in these two segments.
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Title Annotation:The 1995 National Association of Chain Drug Stores Marketplace Conference; Gillette Co.'s antiperspirant and deodorantproducts
Publication:Chain Drug Review
Date:Jul 3, 1995
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