?Case Brief #1 : Clean Edge Razor Essay

1 - ?Case Brief #1 : Clean Edge Razor Essay introduction. Problem Statement: Paramount Health and Beauty Company having difficulty to choose position their new product (Clean Edge) in the market.

2. Situation Analysis:

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Company (Paramount Health and Beauty Company)
Paramount is a respected brand in the industry since 1962
Paramount offered two lines of nondisposable razors and refill cartridges. The Paramount Pro for moderate segment and the Paramount Avail for a value offering Paramount is ready to launch newest nondisposable razor, Clean Edge Clean Edge is improved by utilizing a vibrating technology to stimulate hair follicles and lift the hair from the skin Paramount would be the first company to provide scientific testing by a third-party lab Jackson Randall, the product manager for Clean Edge, is considering the position strategy for Clean Edge

Collaborators
Food stores is important partner to support the sales. In 2000, food stores sold over half of all razors. Drug stores, mass merchandisers, club stores and other stores also partners with Paramount.

Customers
Male specific grooming products seemed to be a bright spot in the industry Electric shavers generally appealed to older consumers
Women’s market

Competitors
Prince
Prince had been a market leader in nondisposable razors since the 1950s and held the number one position in terms of retail dollar sales in 2009. Benet & Klein (B&K)
B&K entered the nondisposable razor market in 1985 with the Vitric brand. B&K
unveiled a new product line of nondisposable razors and refill cartridges (Vitric Master) in 2009. New Entrants such as Radiance Health Inc and Simpsons

On August 1, 2009, Simpsons launched a new nondisposable razor using its deodorant brand, Tempest. Radiance also planned to extend its deodorant brand name, Naiv, into nondisposable razors. Executives at Paramount had learned the Naiv razor was due to launch nationally in September 2010.

Context
Nowadays, consumers are becoming more sophisticated and they tends looking for new technologies (innovation and creation). They invest more money to buy the products that would satisfy their needs. The old law of business said that a satisfied customer brings ten more.

3. Alternatives:

Option One : A Niche product
A niche product is made and marketed for use in a small capacity and specialized, but very profitable. Niche strategy targeting the most intensely involved super-premium consumers who look for superior skin care products.

Option Two : A Mainstream Brand
A mainstream brand require a higher marketing budget in order to reach larger target.

Conclusion:
This option which using mainstream brand assumes that Paramount will get higher revenue rather than using niche strategy. On the other side, Paramount still thinking to use this strategy because of the high cost and given that the strategy using more marketing support and $42 million marketing budget would be needed for one year. Paramount should pursued this strategy, unless the cost of marketing budget could not be cover by sales revenue of Clean Edge.

4. Recommendation:

After review the information on past and estimated in the future, company, products, competitors and branding, I recommend the following strategy: Paramount should taking mainstream brand
Maintain a lower price than competitive products
Paramount could using more marketing support to leverage sales revenue, such as public relation (third party media coverage) or sales promotion (sweepstakes, sampling, etc). For branding strategy, it is better by naming the product “Paramount Clean Edge”. There is a greater emphasis on the name “Paramount”. “Paramount” brand is memorable and familiar by costumer, so if they see “Paramount Clean Edge”, it will bring more positive image and attract consumers to buy rather than if the company using “Clean Edge by Paramount”.

Summary: Mainstream positioning strategy is viewed as a good strategy for launching Clean Edge, because it is profitable for the company. Please see the implementation plan, it given the number of total cost and total revenue that the company will received in the first year and in the second year using both of the strategy. Mainstream strategy will work, unless the Paramount could not afford to pay for marketing budget, advertising and promotions.

5. Implementation Plan:

The following table below details the niche strategy and mainstream strategy including forecast sales and total revenue for year one and year 2:

The company goal is to make profit as much as possible, because mainstream strategy cost a lot and need more marketing support. From table above, we could see the total cost for advertising and promotion using mainstream strategy are more expensive than niche strategy, but the total revenue from year one and two proofed that mainstream strategy is profitable for Paramount.

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