King Camp Gillette created The American Safety Razor Company in 1901. Since the company is owned by Proctor and Gamble, it is difficult to obtain their financials directly. However, according to a blurb in Forbes.com, the sales for the company were a recent $7 Billion. The article goes on to state that the Gillette brand is one of the most profitable for Proctor and Gamble.
King Gillette was a socialist who wanted society to adopt a Utopian-like society. He was an anti-capitalist and wrote a book called The Human Drift which advocated the takeover of all corporations to be run by the public. Interestingly, he became a millionaire from his capitalist efforts with his razor blade business.
How the Company Started
On his way to work one day for a local inventor, he needed to shave, but his blades were dull. This frustrated him, and he remembered an idea that his inventor boss passed along to him.
The idea was to make disposable products. This idea stuck with him, and he created disposable blades and patented the technology in 1901.
He and a partner, who went to MIT, was paramount in using the knowledge learned from the school to find machines that could support Gillette’s idea of the disposable blades. The partner’s name was William Nickerson, who was also an inventor.
It took five years to find the right machines that could support his concept. It also took several more years before the concept started selling. He and Nickerson used their own money to fund the operations.
Many of his family and friends did not believe in his concept and teased him about it whenever they saw him. He presented the concept to researchers at MIT, and they passed it off as impossible.
In more recent times, online sales of razor blades are increasing rapidly. The company missed the boat in making sales initially and have been playing a bit of catch-up. They have significantly raised their online promotional efforts to compensate for the shortfall.
Why it Works
Razors back in those days needed to be sharpened by a barber. This took time and would only last for a limited number of sharpening sessions. If they became too thin, the blades became dangerous where they could even cut a man’s throat.
The idea of a disposable blade removed the need to have blades sharpened. These disposable blades were much safer and cheaper.
Although the company was bought out by Proctor & Gamble in 2005, research and manufacturing under the Gillette brand still exists. It continues to create, innovate, and longer lasting blades.
Although recent competitors have given the company a run for the money, they still control about 65% of market share. This is largely attributable to big marketing budgets and significant brand recognition.
Knock off razors and generics do not have the technology to support a good shave the way that Gillette does. You will likely find these knock off brands to irritate your skin when using them. While this may save some money, it does so at risk to your skin.
Gillette decided to try giving out free razors, knowing that if people liked the product, they would order more blades on a recurring basis.
He is considered to be the first to use this marketing tactic. It was a success as more and more men were tired of having to get their blades sharpened by a barber.
Gillette also became somewhat of a celebrity as his product grew because his image was placed on the product packaging. In fact, people didn’t realize the image was an actual person until they met with him face-to-face.
You may remember the slogan, “The Best a Man Can Get.” This is something the company used for a while and became a familiar jingle. If you have never seen these commercials, you can see one here on YouTube:
Gillette learned early in his career to find others to help promote his brand. He enlisted the help of baseball great, Johannes (Honus) Wagner. He also formed a partnership with the United States Army during World War I and sold the razors at cost to distribute to soldiers.
The soldiers would get used to these blades and when they came home became regular customers of the company.
Gillette has become synonymous with shaving. It is the quintessential product and has been used by generations. However, the products are not cheap. For the higher end Fusion products, you can expect to pay about $3.50+ per cartridge. Although, the company claims it lasts a long time, with regular use it will last about a month.
Lately, competitors are breaking down the company’s stronghold by introducing one dollar cartridges. You can see the campaign at dollarshaveclub.com. This newer company does boast a six blade product rather than Gillette’s five-blade one.
You have to wonder if there is an optimal point where any extra blade doesn’t make that much of a difference anymore. It is probably true that three blades on one cartridge are better than two. And perhaps four blades are better than three.
But once those three or four blades cut the hair from your face, how much closer a shave will those extra blades shave you?
Lessons Learned by The Business
- Gillette tried to be at the forefront of marketing and was often the first in many areas regarding this. He was the first to offer a free product (the razor), and he offered the razor at cost to the military. The company continued in this tradition by being the first to come up with a triple blade (Mach 3).
- Believe in the concept. When Gillette was finally able to obtain the necessary machinery to bring his concept to reality, he knew it would be a winner. It took several years, but he was relentless because of his belief that what he would provide would help people get a better shave.
- Gillette did not let others bring him down. Even though people didn’t believe in his concept initially, he knew it was going to succeed. He proved them all wrong and went on to become a millionaire because of it. It took several years and a lot of work to make this happen, however.
- King Gillette had a vision of placing his product in everyone’s hand. This is why he gave the base product away or sold it cheap. The more people who got used to shaving with his product, the more they would want to keep coming back for more blades.
How Other Businesses Can Learn from This
If you are struggling with success, seek a mentor who can help. Gillette’s mentor was the inventor who he worked for early on. The mentor told him early on to create a product where customers would throw away and come back for more over and over again.
This gave Gillette the initial idea to come up with the disposable blade concept, which he patented.
Although Gillette had already died, the company expanded the product line to other demographics like woman and teenagers. They used his vision of trying to get the product into everyone’s hand and expanded it to a wider group of people. The company has also extended that vision to other countries.