What group of people did Gillette focus on?

OkieStubble said:

What group of people did Gillette focus on?

The hairy ones...

Click to expand...

BSAGuy said:

Obviously for the wealthy and as gifts. Gillette produced many more less costly models for a broader market.

Click to expand...

eastomjac said:

... his razors were given out at hotels as courtesy toiletry items.same deal today its all about selling more blades.

Click to expand...

coase said:

I've been reading a bit more about Gillette history and what I would guess is that he was certainly targeting the upper middle class and of course, inflation corrections don't adjust for the fact that people were poorer back then. So even if you say a "cheap" product then would be the equivalent of a $40 product today, it's not quite right. It would be the equivalent of a $40 product if people were also about a fifth or tenth as rich on average. (Those who are interested might wish to see this link at eh.net which shows different ways of answering the question "How Much is That?" http://www.measuringworth.com/uscompare/ Depending on your referent, a $1 item in 1905 might be the equivalent of anywhere from $20 to over $500 today.)

On the other hand, bear in mind that personal grooming (like clothing) was a lot more important in day to day life than it is today. People of even modest incomes were expected to dress in suits and to shave regularly in all white collar and many blue collar jobs. So even if a product (like straight razors before Gillette) were expensive relative to incomes, men often had to just deal with it and find a way to pay for a razor to get a shave. And of course, because of income inequality and low wages, the upper classes paid for barber shaves and haircuts with greater frequency than they do today. So a $200 razor might seem an extravagance today while a $500 iphone seems like a necessity to an amazing number of teens and young adults. To get a sense of early 20th century life, you'd have to expect that even someone working at McDonald's today would think it essential to pay for a $400 razor or something similar.

Click to expand...

On April 29th, 1903, at a meeting of the Directors, Mr. Joyce and W. B. Holloway were elected to the Board, the treasurer's compensation was fixed at $50.00 per month and a discussion took place as to what price should be charged for the razor set, and for extra blades. It was decided to sell twenty blades for one dollar and furnish twenty blades with each set, but no agreement was reached on the price of the full razor set. A committee was appointed consisting of Messrs. Joyce, Heilborn and myself, to investigate the cost of the goods and to recommend a selling price. On May 9th, 1903, another Directors Meeting was held with Messrs. Gillette, Joyce, Halloway[sic], Chadwick and myself present, and a motion was carried to fix the price of a razor and twenty blades at $3.00 and to sell twenty extra blades for one dollar. Later on, however, Mr. Joyce took the position that the razor was worth $5.00 to a user, and that people would pay that price for it. The rest of the directors were startled, not to say frightened, at this proposition. As a matter of fact, none of us really knew what the price should be, because we did not know what the razor would cost to make and sell. But Mr. Joyce said: "if you don't believe that the razor will sell for $5.00, I will prove it to you, for I am willing to contract for all you can make at $2.50." That settled it, and the razor afterward went on the market at the higher figure. In this matter, Mr Joyce's foresight and courage were of great benefit to the company. If we had attempted to put the razor on the market at the lower price, it is very doubtful if we could have made any great success of the business. There would not have been enough margin of profit to have enabled us to grow and expand as we afterward really did, and we probably would either have had to remain a small concern, or we might have failed altogether. It turned out that the public found the razor worth the price and bought freely from the very start.

Click to expand...

eastomjac said:

King Gillette was out to sell razor blades,the high end razors targeted the mid-to upper classes.on the other end of the spectrum his razors were given out at hotels as courtesy toiletry items.same deal today its all about selling more blades.

Click to expand...

eastomjac said:

King Gillette was out to sell razor blades,the high end razors targeted the mid-to upper classes.on the other end of the spectrum his razors were given out at hotels as courtesy toiletry items.same deal today its all about selling more blades.

Click to expand...

MacDaddy said:

It's an interesting question really. We have at least one direct account of how the company settled on their initial $5 price point from Nickerson in the January 1919 issue of the Gillette Blade:



At the time that Gillette first brought their product to market, there were other safety razor manufacturers competing in the $1-$3 space, including the venerable Star, the newer Gem, and the fledgling Yankee (who would shortly become Ever-Ready). By positioning themselves above the fray and going after the higher end market they became something of an aspirational product instead of just a simple commodity.

Then a couple of major things happened. First, during WWI, the company struck a deal with the U.S. Army to supply them with about 3.5 million razors at Gillette's cost to manufacture them, which put their product into a huge number of hands that probably wouldn't have been able to afford it previously. And then in 1921, when the first patents expired and they released the New Improved models to take over the $5+ price points, they continued to make the Old Types but sold them down in the $1-$2 range, to capture what seems to have been a huge amount of pent-up demand down in the lower end of the market.

Click to expand...

MacDaddy said:

It's an interesting question really. We have at least one direct account of how the company settled on their initial $5 price point from Nickerson in the January 1919 issue of the Gillette Blade:



At the time that Gillette first brought their product to market, there were other safety razor manufacturers competing in the $1-$3 space, including the venerable Star, the newer Gem, and the fledgling Yankee (who would shortly become Ever-Ready). By positioning themselves above the fray and going after the higher end market they became something of an aspirational product instead of just a simple commodity.

Then a couple of major things happened. First, during WWI, the company struck a deal with the U.S. Army to supply them with about 3.5 million razors at Gillette's cost to manufacture them, which put their product into a huge number of hands that probably wouldn't have been able to afford it previously. And then in 1921, when the first patents expired and they released the New Improved models to take over the $5+ price points, they continued to make the Old Types but sold them down in the $1-$2 range, to capture what seems to have been a huge amount of pent-up demand down in the lower end of the market.

Click to expand...