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Marketing 376 Spring 2014
Olson
Gillette Razors in
Brazil
Prepared By:
Daniel Alcaraz Leander Arellano
Jen James Thania Morales
Angelina Munoz
1
Market Analysis Plan
Introduction
In comparing the five countries for which to market Gillette Razors, we have decided upon
Brazil. This decision was based upon many factors; Brazil is a BRIC and a Newly Industrialized
Country; Brazilian population is approximately 200 million and growing at a rate of 1.8% annually; the
status of the middle and uppermiddle class is rising substantially; and Brazil is the host of the 2014
FIFA World Cup as well as the 2016 Summer Olympics. Our target markets are the middle class and
the uppermiddle class, and our product mix includes the Gillette Fusion ProGlide and the Gillette
Fusion ProGlide Styler.
A. Goals/ Objectives, Strengths and Weaknesses of the Firm & Brand for Country
1. How SWOT factors correlate to the advantages of the country market chosen.
Strengths: 95% of imports are received by boat through their various shipping facilities and
ports. Since the United States ranks 2nd in product imports shipped to Brazil (1st is China, 3rd is
Argentina), we believe that the United States & Gillette would be best suited for exporting razors to the
Brazilian marketplace. The distance between the United States and Brazil is also a strength that is
advantageous for the U.S. razor company. In comparison, the companies Muhle and Merkur which
encompass the major competitors in the razor market are stationed in Germany. Thus, these foreign
competitors would have to travel much farther to reach Brazil to market their products, as opposed to
Gillette. This is a cost that will outweigh the benefits for German razor companies, resulting in reluctance
by the German manufacturers, and also a more advantageous position for the United States.
Furthermore, Muhle and Merkur razors have hefty price tags on them, a price that would likely be
unaffordable to many in the developing marketplace of Brazil. Gillette however, supplies razors that are
just as efficient, affordable and desirable to consumers in comparison to their more costly competition
from Germany.
Weaknesses: Due to it’s status as a rapidly developing country, the Brazilian marketplace is
extremely volatile and unpredictable. Consumers are particularly easy to sway in a particular direction.
Therefore, if a German competitor becomes the primary source for razors in the Brazilian marketplace,
it will be much more difficult for Gillette to develop a strong competitive position against the German
razor manufacturers.
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Opportunities: Gillette is a company founded and based in the United States, which is much
closer geographically than the primary threats German companies Muhle and Merkur to the Brazilian
marketplace.
Threats: As mentioned above, the German razor companies, particularly Muhle and Merkur
are the primary threats to Gillette’s market dominance in the razor marketplace. Since Brazil is growing
at a quick pace, we cannot rule out the possibility that Brazilian citizens may construct a domestically
manufactured razor that is more cost efficient and desirable than Gillette razors.
2. Why the other four countries were not as good a fit for Gillette Razors.
Denmark is a country located in Europe bordering northern Germany. Obviously, it is a more
easily accessible country for Germany to market its’ razor companies as opposed to the U.S. razor
company Gillette, which is roughly 10,000 miles away from Denmark. We also took into consideration
the stage of market development in Denmark, which currently stands as a developed country, hence it is
safe to assume that market saturation for razors will be achieved by a closer manufacturer, particularly
by Germany.
Roughly 1,000 miles from Denmark, Finland is also much closer to German razor manufacturers
than U.S. razor company Gillette. Finland is also a developed country that is likely to have experienced
razor market saturation via German influence.
Germany supplies a huge amount of domestically manufactured razors, and has been doing so
for approximately 100 years. The razor market in Germany is extremely saturated by German razor
companies, particular those of Muhle and Merkul. Proposing to export Gillette razors to Germany is an
extremely risky venture, the likelihood of failing to sell to an already saturated market is high, and could
cost not only Gillette, but also Proctor & Gamble millions of dollars for attempting such an endeavor.
In 2013, Pakistan was ranked as one of the poorest countries in the world. To this day,
Pakistan is still a third world country that has not heavily invested in shaving products, whether it be
U.S. or German manufactured razors. Due to modern warfare like many Middle Eastern countries,
Pakistan has become a risky, volatile market. Furthermore, many Pakistani men prefer to trim their
beards rather than shave them. Although there are some Pakistani citizens that do shave, it is not as
viable a market as the potential prospects of marketing to Brazilian citizens. The success rate of
marketing razors to Pakistan is expected to be lower than all other countries under consideration.
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B. Analysis 1. Market Assessment of the Country
Demographics After conducting a brief demographic study of the Brazilian market, it is quite
obvious that the largest country in South America is a wonderful opportunity to market Gillette razor
products. With a population that hovers around the 200 million mark and approximately home to 65
million households, Brazil is indexed the 6th largest country in terms of world population ranking.
Although not ideal, population replacement rate in Brazil is fairly stable at 1.79 children per woman, so
we expect relative stability for the razor market in the long run. The age range of Brazilian citizens allows
for a fairly stable market in the short run, which only increases in the long run; current median ages for
men and women are 30 and 32 respectively. Furthermore, with about 30% of the population over the
age of 45 and an average life expectancy of 73 years, short term market success is projected to last for
almost thirty years of stability. Proportionately, about 41% of citizens are under the age of 25, thus long
term success for marketing endeavors is expected to grow as time progresses. In comparison to the
Organisation for Economic and CoOperation Development (OECD) average country quality of life
index, Brazil is slightly above average; OECD average is 80, while Brazil is at 82. With more than 90%
of the adult population being able to read, there is a high level of adult literacy, thus consumer
understanding of products & instructions for use do not pose any foreseeable issues.
MicroEconomic Factors Brazil’s economic prosperity has allowed it to slowly redesign its
wealth distribution and empower a new consumer market. WIth an expanding middle class purchasing
power, there is a lower fertility rate, a growing life expectancy, and better socioeconomic conditions.
MacroEconomic Factors As the seventh largest economy in the world by purchasing
power parity, Brazil has the highest GDP in all of Latin America and strives to become more active in
the international manufacturing market. Coupled with an international market that guarantees
productivity growth and dilution of the elevated costs of living, the Brazilian middle class is clearly on the
rise. Therefore, market growth potential in the future is high enough to determine that choosing Brazil as
our target market is the ideal candidate for Gillette razors. The stability of the Brazilian marketplace has
substantially improved, thereby and several factors have allowed for the creation of a stable
macroeconomic environment, including a consolidated democracy with over 20 years of regular
elections, 20 years of trade liberalization, 15 years of price stability, 10 years of fiscal targets
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(established after a deep fiscal restructuring at all levels of government), strong central banks, and
innovative social policies.
Amidst the global economic crisis, Brazil has emerged with its head on its shoulders, due to the
heavily regulated and controlled banking system and the Brazilian monetary stability, proving that it is a
country capable of participating in global economic governance and further prosperous market fruition.
Given Brazil’s market size and vast resources, it is a marketplace that has potential to create the
capacity to respond quickly to global demand, particularly in the commodity (toiletries, consumption,
etc.) and energy sectors, thereby evidencing the growing demand for razors, making it a key component
of the growing global economy.
Geographic Factors and how They Shape the Culture Brazil is unique in comparison with
other emerging markets given its combination of natural and structural assets. Thriving commodity
exports of iron ore, petroleum and soybeans, and the availability of natural resources like oil and gas,
have allowed Brazil to glide through a period of rapid and sustained economic growth.
The sheer mass and perforated shape of the country permit Brazil to share common borders
with most of the other South American countries, allowing Brazil to assume a primary trading role with
relative ease. Brazil’s complex landscape is a great way to describe its inhabitants. From the Northwest
to the Southeast, natives express stark contrasts, and neither can function independently without the
other; Brazilians thrive on community involvement.
The rivers and waterways of Brazil are vital to the country’s transportation of goods and fertility.
The dry regions require water from the rivers to survive, just as the natives rely primarily on port
infrastructure for imports and exports. Such trade allows Brazilians the opportunity to interact with
people from all over the world, increasing their global presence. Since Brazil shares borders with ten of
the twelve South American countries, the inflow & outflow of worldly news flows through the country
every day. This has proven to strengthen Brazil’s regional and international country alliances. However,
just like the hinterlands behind the mountain that don’t get rain, Brazilians are likewise slow to show
development in some areas, particularly in the field of education.
Significant Historical Factors Shaping the Culture and Discussion
Brazil’s stability has been an earmarked topic of discussion. The past instabilities of the country
have left some industries skeptical of the potential growth in Brazil. This is because of the instability of
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ideologies of governance, which have shifted Brazil’s future as an economic powerhouse several times.
Upon further investigation of the stability of the Brazilian market, skepticism from other industries can be
used to our advantage when marketing Gillette products in Brazil. In combination, it’s large population,
growing middle class purchasing power, and high quality of life all provide for the foundations of a stable
and continually progressive economy.
Another area of historical concern in Brazil is the country’s rate of inflation. The oil shock of
1973 was an external factor that has tremendously affected Brazil’s internal politics. The crisis that
resulted had left Brazil with an overvalued currency, as well as a high current account deficit. When the
oil market began to gain power, and the Eastern European market opened up, Brazil’s internal politics
could not operate without taking into account the impact from outside political and economic forces.
Brazil has taken the necessary steps to curb the impacts from external factors. It has also taken steps
necessary to stabilize impact from nonbeneficial internal factors.
Perhaps one of the most influential recent historical factors that have shaped the culture is the
concept of “la Bolsa Familia.” This is a project that has proven to benefit lower class families, who
now have access to the marketplace. In the past, the international marketplace was exclusively for the
elite, but now, with an increased global need for commodities, this has allowed Brazil to have a more
influential position, thereby providing foundation for a potentially more prosperous market, particularly
for the various subcategories of the commodity sector, obviously inclusive of the razor market. Despite
the huge hit that other countries are still recovering from, Brazil has benefited from relatively stable
economic growth, low inflation rates and social welfare improvements.
Political and Legal Factors that Shape the Marketplace
There are political and governmental areas that negatively impact the Brazilian market. As stated
by Gannon, Brazil is a country “plagued with a distrust of government and widespread bribery and
corruption.” The excessive government bureaucracy and political oligarchy existent in some of the
poorer states have been effective in blurring the lines between public and private consumption. A high
rate of taxation & high crime rate also add to the issue.
However, since Brazil experienced little effect from the global crisis, there’s been a huge
expansion in Brazil’s middle class, who have enjoyed increasing wealth. Also beneficial for the country’s
international market position was the new wave of investment by companies that were attracted by
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Brazil’s growing economy and membership of Mercosur, which occurred in the 1990s. Brazil offers a
lowcost location for foreign investors from the developed countries.
Infrastructure
As of 2010, Brazil has not invested enough into its infrastructure. Studies show that heavy
infrastructure investments translate into longterm macroeconomic growth. Although Brazil has more
available resources, these resources are still insufficient. Combined with a growing purchasing power,
and a new role in global politics, the country must invest more into infrastructure to remain competitive.
A key concern is the insufficient nature of Brazil’s existing infrastructure, because in it’s current state, the
country will be unable to sustain domestic growth and dynamism in local & foreign trade. The
bottleneck effect this creates is a major problem for country’s infrastructure, which is why infrastructure
reform is vital to prevent Brazil’s growth from stalling.
As this chart clearly indicates, Brazilian investment in infrastructure as a percentage of GDP has
decreased over each 10 year period from the 1970s into the 2000s. An issue of consideration pertains
to the National Brazilian Development Bank, which invested about R$274 billion from 20102013 in
the market (up 38% from 20052008). Roads remain the primary means of transport in and around
Brazil – both for passengers and for freight purposes. The Central Intelligence Agency estimates more
than 1.5 million kilometers of paved roadways, and according to Forbes Magazine, there are about 410
vehicles per square kilometers. The Brazilian highway system is one of the largest in the world, but is
also known for being inadequate. As a result, some of the roads are undergoing a major revamp and
expansion. Partly due to the 2014 FIFA World Cup and 2016 Summer Olympics, the motivation
behind this expansion and development has also been to link the industrial sector with the less
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developed parts of the country by road. The recent decisions advocating infrastructure reform are
attractive, not only to Brazilian citizens, but also to foreign investors.
2. Relevant Consumer Behavior of the Country and Culture
Cultural Values: Cardinal, Primary, and Secondary
Brazilian culture is considerably one of the most unique in the world. Brazil’s cardinal values are
very similar to ours in the United States. “Individual Brazilians value equality and the freedom to pursue
their dreams” (Gannon). In addition to a high emphasis on individuality, the highestranking Brazilian
values are true friendship, mature love, happiness, and inner harmony (Scribd).
Brazil’s primary values revolve around the high importance placed on family. Family is the
foundation of the social structure and forms the basis of stability for most people (Kwintessential). There
are many important aspects that make up the Brazilian family unit. This includes parents, the extended
family, and even ancestors. The prominence of a strong family network provides Brazilians a sense of
stability in their lives. Not only does it impact their personal individual lives, but influences the Brazilian
perspective on the world (ACAD).
Secondary cultural values for Brazil are centered around personal relationships. Personal
relationships play an important role in the lives of Brazilians and influence all aspects of one’s life,
including one’s personal and professional life (ACAD). In an individual’s professional life, Nepotism is
very important. Because Brazilians are extremely familyoriented in every aspect of life, Nepotism
implies that employing people one knows and trusts is more beneficial than a stranger. Brazilians respect
hierarchical relationships, and their society is structured along the lines of economic class and social
status. Such hierarchical values like these are typical in countries with a Catholic heritage, since people
have been conditioned to respect the authority of priests and bishops (ACAD).
Analysis of Hall’s 10 PMS’s (Primary Message Systems)
1. Interaction Meaning of Life, Philosophy, Cosmos, Religion (Olson Mar. 18)
As we might already know Brazilians are heavily united by dancing the samba and this translates
into their personal lives. Brazilians are extremely patient people who continue smiling “because they can
dance the samba and be the center of attention in a world full of freedom.” (Gannon) The samba
represents a nation that is full of contrasts and a diverse culture; their complex cultural will continue
8
being expressed by them escaping through the dance of samba. The samba is a national symbol within
Brazil and it “represents this notion of a spontaneous escape from the everyday reality of unemployment,
low standard of living, and poverty that affects many Brazilians.” (Gannon)
Escape is something Brazilians have been craving and it is a way for them to hide from hardship
and difficult times. Although they might be faced with challenges they still posses a great passion for life.
“Individual Brazilians value equality and the freedom to pursue their dreams and [they] are allowed
religious freedom and the right to procreate with whomever they chose.” (Gannon) As mentioned
earlier, their religion matches the vast diversity of Brazil. Religion is found as a contrast between Roman
Catholicism and African cult worship. Their lives are surrounded by contrasts in many ways including
their national flag that literally translates to “order and progress.” (Gannon)
2. AssociationHuman Relationships (Olson Mar. 18)
“Tudo bom” is a phrase which means everything about life turns out to be good in some way or
another. (Gannon) This helps to understand Brazilians human relationships with others. It is quite easy to
make acquaintances or “colegas” in Brazil but it does however take a long time to cultivate a deep and
lasting friendship. Their relationships between men and women are complex; adding to a country of vast
contradictions. As mentioned in the Gannon text, “the need for human contact best exemplifies through
the Brazilian family; family ties are paramount of importance in Brazil.”
Adding to a nation of complexity is the fact that Brazil has five different currencies dating back
since the year 1940. This may be a reason why it has “one of the widest disparities of wealth
worldwide.” (Gannon) Brazilians respect hierarchical relationships and “their society is structured along
the lines of economic class and social status.” (ACAD) Their hierarchical structure means that respect
must be shown to those of higher status, for example priests within the catholic church.
3. Subsistence Food and Work (Olson Mar. 18)
As we continue exploring Brazil we start to realize that Brazilian culture continually follows this
idea of land of contrasts as stated by Gannon. He mentions that the south is much wealthier than the
north which only adds to the division of the rich and poor. The poor as we might guess might use
samba to escape the reality of economic hardship. Many Brazilians still continue to smile and dance the
samba even within poor neighborhoods known as “favelas.” (Gannon) Although we may see a lot of
poor Brazilians we also see a growing middle class throughout the country itself.
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Major firms in Brazil will tend to help their employees out if under financial stress. They are not
only incredibly helpful financially, but they will also be there during times of need personally and within
the family. It is “not uncommon to see a high correlation between people’s personal and work lives;
Brazilians will mix their business and social life. It is also not unusual for Brazilian factory workers to
spend a month’s salary on the costumes they will wear at the Carnival Parade.” (Gannon)
4. Procreation (Olson Mar. 18)
Brazilians are all about family, they are incredibly close to their loved ones and treat their closest
friends as family. Romantic relationships are seen everywhere since Brazilians are very affectionate.
Brazilians are “allowed religious freedom and the right to procreate with whomever they chose.”
(Gannon) This religious freedom is seen through their relationships; sexuality is well embraced. There is
a large gay population even though it is considered a “macho culture.” Although roles are well defined,
men are men and women are women, there is still some contrasts within this. Brazilian men really care
about their appearance, even masculine men, as they are well known for caring about their appearance
and grooming rituals.
5. Learning (Olson Mar. 18)
The educational system in Brazil is quite interesting, “as it is both lax and controlled” according
to Gannon. The vestibular is an entrance exam given to students in order to enter a university and most
students push really hard in order to pass this exam and be admitted into a university. Education is an
area in which contradictions in Brazilian culture continue and it is common to get things done by taking
shortcuts and by avoiding a direct plan or schedule. Their sense of time makes them a polychronic
culture.
6. Time A Future Polychronic Culture (Olson Mar. 18)
Brazilians are ambiguous or hesitant about the future but Gannon suggests that “Brazil is a
country about the future and always will be” (Gannon) probably due to its growing economy and the
fact that they hide from uncertainty by continually escaping through their love of dance. The land of
Brazil was a part of the Portuguese Empire mostly because Brazilians did not want to go to war and
therefore Roman Catholicism evolved in the country. This created several different forms of government
over time making this country “extremely diverse with several distinct regions and twenty six states.”
(CIA)
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Brazilians tend to be more polychronic in the sense that they are highly committed to people and
long lasting relationships are built over a long period of time. They do not follow a schedule and tend to
borrow and lend things between their friends and loved ones. They are highly inclined towards visuals
and images rather than words. By them sharing so many borders it allows Brazilians to interact with
other cultures and opens them up territorially.
7. Space Personal Space, Distance, Territoriality (Olson Mar. 18)
Their long lasting relationships and closeness to each other makes them a physical culture that
will glaze and physically touch one another. They are very attached to others and this allows them to
share personal space and makes them a very easy culture to approach. “Personal bonding or ‘jeitinho’
is translated as enlisting a fellow human being to help one circumvent the rules due to one’s personal
circumstance and engaging in this ritual allows Brazilians to bypass both impersonal rules and to exert a
certain amount of control over their daily lives.” (Gannon) Brazilians are able to detach themselves and
open up to others. A high reliance on trade allows Brazilians the opportunity to interact with people
from all over the world and therefore increasing their status in the global marketplace.
8. Defense Internal VS External (Olson Mar. 18)
Brazilians are more internally focused since they do operate under rules of law and of course
they follows their own set rules of man. They are a high power distance society that follow rules and
tends to use medicine reactively. In the sense of an external culture, Brazil does have a military in
charge but troop importance isn’t as important as other countries. Brazil was essentially founded by
three different groups. The conquering Portuguese, the endemic Brazilian people, and finally slaves in
Brazil (Country Reports.) “Businesspersons might hire a ‘despachante’ or agent to aid in the navigation
of Brazil’s numerous and complicated bureaucratic rules; the structure is somewhat complex” adhering
to the complex nation of Brazil as mentioned many times. (Gannon)
9. Play Cultural Aspects and Recreation (Olson Mar. 18)
Brazilians tend to get lost while dancing the samba and use dance in order to escape which
means they tend to lose track of time. “Too much uncertainty avoidance motivated them to escape
tension through the music and dance of the samba.” (Gannon) Their focus tends to drain into their dance
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following their complex culture and lack of commitment to certain tasks but rather to other people. Their
relationship with others is highly important to them. Gannon put it best in the sense that “Brazilian people
come from various social and economic background and races and few nations can match this nation’s
diversity.”
10. Material Effects (Olson Mar. 18)
Brazilian people tend to share with each other, especially within their own group. Their sense of
high uncertainty avoidance tells us that they are more quality oriented than quantity. Although some
Brazilians are faced with many challenges, in many cases economically, they still posses a great passion
for life who will continue to value equality and the freedom to pursue their dreams.
Hofstede’s Score Analysis
Graph from: Geert, Hofstede. “What about Brazil.” The Hofstede Centre.
http://geerthofstede.com/index.php
High on UA (Uncertainty Avoidance): 76 (The Hofstede Centre)
This creates a ruleoriented society that institutes laws, rules, regulations, and controls in order to reduce
the amount of uncertainty (The Hofstede Centre). As a result of this high Uncertainty Avoidance
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characteristic, the society does not readily accept change and is very risk adverse. Countries high on
UA like cleanliness and order. However, high on UA makes change quite difficult. Longterm
relationships are necessary in the business world for Brazil. Brazilians believe that trust and friendship
are essential for business.
High on PDI (Power Distance): 69 (The Hofstede Centre)
These societies are more likely to follow a caste system that does not allow significant upward mobility
of its citizens. It is easier to manage a society. Societies with a high PDI have more discipline. Also,
ability to effect changes quickly and easily. However, they are unwilling to accept responsibility.
Countries with high PDI tend to dress with formal brand images. They are also obedient consumers.
Countries with high PDI expect differential prices (special people get special prices). Brazil is a
patriarchal society. The father is the final decision maker. In the brazilian workforce managers are seen
as the final decision maker (Hierarchical structure).This implies how power distance is involved in the
brazilian society.
Individualism: 38 (The Hofstede Centre)
Brazil has a low score of individualism; loyalty in a collectivist culture is paramount, and overrides most
other societal rules (The Hofstede Centre). Collective countries tend to only trust the group.
Collectivism: Brazil has a higher score of collectivism than the United States. Collective countries tend
to only trust the group. In the brazilian society family unity is extremely important. According to Gannon,
children don’t leave home until they get married.
Masculinity: 49 (The Hofstede Centre)
With a score of 49, we can conclude that Brazil is quite competitive. A masculine country is less
emotional. If they have something they just want more and more of it. Brazil has a passion for sports,
especially soccer.
Long Term Orientation (Confucian Dynamism): 65 (The Hofstede Centre)
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On the LTO Brazil scored a 65. We can say that Brazil is in need for immediate gratification. A high
score in LTO can also lead to the conclusion that Brazilians look for long term relationships, therefore it
takes time before a foreign can have a successful business deal with a Brazilian.
Consumer Behavior as part of Cultural Values, Norms, and Attitudes
Brazil has one of the most diverse and wideranging cultures in the world. Their cultural values,
norms, and attitudes are what make consumers to behave the way that they do. In Brazil, trends
connected with the principles of “quality of life”, convenience, priceconsciousness, and brand loyalty
and others are very present in the market (PWC).
Because of these trends, many companies in Brazil have already provided products and services
to accommodate the needs of consumers. Brazil being a varied country, there are many different classes
of consumers within the Brazilian consumer market. However, regardless of the consumer’s profile,
most developed cities will accommodate to high or low consumption, qualityservice or priceoriented,
and branded or private labels. One important attitude of Brazilian consumers is they distinguish products
by the brand, associating them with concepts of high quality, trust, loyalty, and status (PWC).
Shopping is definitely integrated into the lifestyle of the Brazilian urban population both as a
usual and necessary activity and an entertainment programme. Purchasing decisions, opinion makers to
attract new consumers, and low prices, vastly influences their attitudes towards distinct brands. Major
impulse purchases are considered a norm in Brazil’s culture (Euromonitor).
Consumer Behavior as Related to the Specific Product Category
Brazil is considered the fourth largest cosmetics and personal care market in the world (PWC).
There are many factors that have contributed to this rise in consumption over the past years. This
dramatic increase is due to the rising disposable incomes among mid and lowincome consumers.
Currently, the Brazilian cosmetics and personal care market is consisted of 1,367 manufacturers of
which 15 are large companies with revenues of over BRL 100 million, accounting for 71.7% of total
revenues (PWC). Many of the leading companies in Brazil are similar to those of great popularity in the
United States. Some of these multinational companies accounting for the mostshare are Avon,
ColgatePalmolive, Johnson & Johnson, Nivea, and Procter & Gamble.
14
Another factor that contributes to being the fourth largest cosmetics and personal care market is
because Brazil is arguably one of the cosmetic surgery capitals of the world. This is due to the fact that
individuals place an increasingly higher emphasis on an allround grooming regime (Euromonitor
International). Convenience and low prices are the main factors in the strong performance of disposable
razors. These factors are typically inclined to target younger consumers and the millions of lowerincome
male consumer (Euromonitor International).
3. Competitive Analysis of Country Market for Gillette Razors
Brazil’s razors market is the second fastest growing in the world. Also, the BRIC nation leads
the male razors and blades market in its group. Moreover, it has been forecasted that Brazil will soon
overtake the U.S. and become the leading male grooming market in 2015 (Spire Research). As a
result, the personal care growing market in Brazil, has attracted more than 327 companies in the last
years. However, only the few top companies hold the 61% of the market share (Euromonitor), and the
razors segment was responsible for the 59.3% of the male razors and blades market in Brazil in 2009
(Datamonitor Report).
Due to the low entry barriers established by the Brazilian market, the industry’s structure has
been shaped significantly. Moreover, alternatives to the use of razors when removing corporal hair have
raised and created a significant competition to top companies in Brazil. One of these companies is
Natura, which holds the biggest percentage of market share in the personal care industry. A reason for
this is that Brazil ranks #1 in the world with pharmacies and drugstores, which promotes the creation of
their own formulas and alternatives to hair removal processes. Brazil is followed by India, and USA
(Euromonitor).
A key factor when analyzing the competitive market for razors is that Brazilians have the highest
percentage in hair removal (Euromonitor). This opens doors for a wide and competitive market for all
kinds of hair removal products. In addition, Brazil has the second largest male toiletries market by value
(Market Research Reports). In the male market, the early young adults (30 yearsold or less), often
firsttime users of shaving products, demonstrate a heavy consumption of male toiletries products.
Essential factors when choosing which brands to use are quality and individualism. Due to Brazil’s
increasingly skincare awareness, the consumption of products that satisfy the needs of the different skin
types, hair, and lifestyles through individualistic features are important factors when promoting such
15
products. Moreover, the vast majority of users of disposable razors and blades, 44.3%, are users that
also seek ease of use and convenience. These drivers motivate consumers in Brazil to purchase a
particular brand or style (Market Research Reports).
Additionally, when studying the razors and blades market, we cannot take for granted the
competition faced by hair removal alternatives such as waxing, hair removal creams, and also electric
razors, and battery operated razors. Electric razors brands such as Phillips, Black & Decker and
Remington are some of their foreign competitors. Yet, they only account for 3% of the market (Kline
Group Latin America). However, disposable razors still dominate the market because of the consumer’s
familiarity to this product.
1. Domestic Competitors:
One of the strongest domestic competitors could be the successful and innovative company
Natura, which has been able to place themselves as a top company for skin care and environmental
sustainability in Brazil. As of 2012, Natura held 13% of the market share in Brazil, the biggest
percentage among its competitors (Euromonitor). This threatens the razors and blades segment, because
more often people are moving towards skin care alternatives such as natural hair removal products
offered by Natura.
Furthermore, as mentioned before, due to the familiarity of the consumers with razors, the ease
of its use, and the variety of styles and brands, razors are still the most widely method of hair removal.
Gillette has been able to take advantage of this opportunity in the US market, and seeks to follow
similar strategies in Brazil as well. Moreover, due to the fact that shaving is an intimate practice,
consumers often seek a smooth and pleasant experience. This is one of the reasons why Gillette has
been able to stay in the market as the leader provider in the razors market.
Its mobility and smooth performance are key differentiators of their products. Such is the
example of the ProGlide and Mach3 for men, which are two of the most sold razors in the world along
with the Venus razor for women. Another differentiator from other competitors is their solid history as a
leader brand. Gillette, a brand of Procter & Gamble, has accounted for almost half of the male
grooming market, factor that will benefit the razors company when expanding into the Brazilian market.
Also, the use of constant TV advertisements, and celebrities and national leaders advertising campaigns
16
helps the brand create trust and credibility in the Brazilian market. Gillette’s indisputable success in the
US market will support the future expansion of its products to Brazil.
2. Foreign Competitors:
Gillette competes against established and global companies such as Unilever, BIC, and Schick
made by the battery company, Energizer. However, Procter & Gamble Company is the leading player
in the razors and blade market in Brazil (Datamonitor Report). It is followed by Unilever and BIC,
respectively. If Gillette enters into the Brazilian razrs market, we intend to occupy more than 50% of
the market share. Gillette’s competitor Unilever holds 10% of the toiletries market share (Euromonitor).
In addition, BIC has previously stated that they will be a strong competitor for Gillette, and will intend to
take market share from the Procter & Gamble razors division (Globo Brazilian Newspaper).
Lastly, there is low private label penetration due to the high market concentration by top razor
brands. The vast majority of Brazilians prefer to use a branded product, rather than a lessknown
brand. As a result, top brands such as Gillette are been able to take advantage of being a top razor
brand by constants advertising and celebrity endorsement in order to create brand exposure in the
Brazilian market. Such is the case of the recent advertising campaign for Gillette during the Brazil World
Tour, where they have acquired the naming rights. Gillette has been able to gain large amounts of
exposure not only throughout the world, but most importantly in Brazil, where Procter & Gamble is
been able to take advantage of key determinants in Brazilian product consumption, such as their passion
for soccer, and marketing strategies such as constant brand exposure.
C. Marketing Plan for Selected Products
1. Product Decisions
Branding:
Because Brazil is mainly a collective culture, word of mouth is one of the main strategies Gillette
will need to approach in order to gain vast amounts of exposure. Brazilians are highly influenced by the
opinion of those close to them, as well as leaders or wellknown characters and celebrities, which will
be one of the most effective marketing strategies fro Gillette. Celebrity endorsement will be a key
strategy in the advertising of our remarkable razors.
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This also reflects the similarity mentioned by Gannon in regards to the Brazilian samba and their culture
overall. The samba includes small circular steps that have been present throughout their history and
behavior (Gannon). Gillette’s vision is to take advantage of the small and close relationships between
Brazilians, such as the strong unity bonds in families, and take constants and persistent steps in order to
effectively market our products. Moreover, because Brazil is driven by power distances and hierarchies,
it is important to implement repetition , to create a sense of “top of mind” brand in our target market.
Image Development:
Gillette will build a high end image of quality, high functionality, and status overall.
Product Features:
Due to the fact that it is a society that values high quality, trust, loyalty and hierarchical status,
we have chosen to develop a product with high end features in order to create a competitive razor to
attract the Brazilian male market.
Throughout the development of the Gillette’s razor Fusion, we will highlight the high tech
features of the product, as well as the release of different World Cup special edition razors in order to
appeal to this neutral culture. As a result of their profound passion for soccer, their national sport, and
also their high appreciation for quality of life, Gillette seeks to implement a distinctive model that will
highly attract this passionate market.
As seen on the Hofstede’s value analysis, Brazilian culture scored relatively high on uncertainty
avoidance. This characteristic will guide us to accentuate the high functionality of our Fusion razor.
Samba is an escape for the Brazilian society, from social inequality, job unemployment and the
different economic challenges Brazilians face everyday. As mentioned by Gannon, samba is an escape
to paradise (Gannon). For this reason, every time the consumer uses our razors, they should be able to
escape into a unique shaving experience.
Product Mix:
We will launch two products into the Brazilian market, the Fusion proglide in order to appeal to
the middle class market, and also the Proglide styler uppermiddle class. Because of the accentuated
different in social status, we want to offer a product that will be appealing not only to one sector, but for
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other markets as well.Brazilians prefer to be differentiated between the different social status, this is a
result of their high scores on power distance.
Packaging:
The packaging for our Gillette Fusion razor will provide visibility of the product, as well as an
elegant and quality packaging. Their neutral results on masculinity and femininity leads them to be highly
influenced on the details as well as the overall impression of high functionality of the product. Moreover,
because of their importance on status, the packaging will provide a welldesigned and neat impression.
Branding issues:
Because of their high reliance and loyalty to products that are wellestablished and provide a
reliable and long history of good quality and performance, we might face market entry issues and
challenges as a new brand. The need to develop trust and portray high quality of our product in order to
build a sense of high functionality is crucial. That being said, we have implemented a specialized plan to
market during the 2014 FIFA World Cup with the cultural appeal and love of football, as well as
celebrity endorsements from iconic people like Roger Federer.
2. Pricing Decisions:
MidPrice Products
Gillette seeks to place themselves as a high status brand. After completing an overview of
various prices for toiletries in Brazil from 2010, we have decided to price this product a little higher than
the 2010 price of R$8.55 for a 2Pack of 3 blade razors. Our plan is to increase the price to R$24.95
(walmart.br). When taking this decision, we have taken into consideration the Brazilian GNI per capita,
which was $11,630 in 2012 and is expected to be even higher in 2014, especially after the 2014 FIFA
World Cup and 2016 Summer Olympics .
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*Graph found at http://data.worldbank.org/country/brazil.
3. Placement Decisions:
Gillette will be first distributed into major economically developed cities such as Rio de Janeiro,
Sao Paulo, Belo Horizonte, Fortaleza, Salvador, Brasilia, and Manaus, which is the eighth largest city
located on the west side of the country. (Costasur) The high concentration of Brazilian population in
these cities will allow Gillette to acquire huge amounts of exposure, as well as a wide approach of the
Brazilian population.
4. Promotional Decisions:
As indicative of the Hofstede Values, Brazil ranks high on collectivism, and as a result, we will
not offer coupons or discounts for the higher priced razors. However, taking into consideration the
increasing GDP per capita, we may begin by offering discounts for disposable and low priced razors to
see if such promotions would prove effective in further expanding our market potential.
D. Budget
Ball Park Costs Involved:
Taking into consideration that one U.S. dollar is worth approximately $2.20 Brazilian Real, we have
decided to price our products accordingly. By researching the price comparisons of the Fusion Proglide
and Proglide Styler in U.S. markets, we plan to market the Fusion ProGlide at approximately R$24.49,
while the Fusion ProGlide Styler at approximately R$39.95. These prices are comparable to Walmart
Prices in the United States, adjusted to international currency conversions.
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Financial Opportunity:
We have the opportunity to eliminate substantial competition in the razor market with our prices. In
comparison to Muhle, which charges an average of $60 U.S. for one of their razors, the same razor
would cost about R$132 in Brazil. Furthermore, the Merkur Model 178 Classic is about $45 in the
U.S. thereby making it about $99 in Brazil. Contrasting these prices with those of the Gillette razors we
plan to market, consumers will appreciate the comfort and feel of our razors as well as the less costly
financial burden this puts on their wallets.
Executive Summary:
Our marketing group has chosen to expand Gillette Razors into the Brazilian marketplace. There
are many reasons as to why we chose Brazil over the 5 countries we have individually been assigned.
Brazil is one of the BRIC countries and is a rapidly developing country with huge market potential and a
massive population. We have found Brazil to be the dominating choice over Denmark, Finland,
Germany and Pakistan. The decision to export Gillette razors to Brazil was voted upon unanimously.
Conclusion:
Throughout this proposal we have provided an overview of Brazilian male razors market,
implemented and applied the results of studies such as the Hall’s and Hofstede values, and lastly
evaluate the market as well as provided a marketing plan for the launching of this product into the
Brazilian market. We believe that the release of Gillette’s razors Fusion and Proglide Styler will entitle
the company with a great success and start of a longlasting and loyal relationship with our male target
market. Bibliography
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