Case Study Description of Clean Edge Razor: Splitting Hairs in Product Positioning
After three years of development, Paramount Health and Beauty Company is preparing to launch a new technologically advanced vibrating razor called Clean Edge. The innovative new design of Clean Edge provides superior performance by stimulating the hair follicles to lift the hair from the skin, allowing for a closer shave. The company has already decided to introduce Clean Edge into the men's market where it has a strong presence. Jackson Randall, the product manager for Clean Edge, struggles with how best to position the product for the launch. One strategy is to release Clean Edge as a "niche" product, targeting the high-end market of fastidious groomers looking for superior skin care products. Another strategy is to release the product into the highly competitive mainstream razor market where the product can be positioned as the most effective razor available. Randall meets internal resistance to the mainstream strategy from the product manager for the company's current, but aging, mainstream razor products and he must consider the effects of cannibalization in his plan. Randall must recommend an optimal strategy and provide supporting economic analysis of his decision--not just for Clean Edge, but for its effect on the entire company.
Swot Analysis of "Clean Edge Razor: Splitting Hairs in Product Positioning" written by John A. Quelch, Heather Beckham includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Razor Clean facing as an external strategic factors. Some of the topics covered in Clean Edge Razor: Splitting Hairs in Product Positioning case study are - Strategic Management Strategies, Change management, Conflict, Financial analysis, Leadership, Marketing, Product development and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Clean Edge Razor: Splitting Hairs in Product Positioning casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, challanges to central banks by blockchain based private currencies, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing energy prices, competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings, cloud computing is disrupting traditional business models,
there is backlash against globalization, wage bills are increasing, etc
Introduction to SWOT Analysis of Clean Edge Razor: Splitting Hairs in Product Positioning
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Clean Edge Razor: Splitting Hairs in Product Positioning case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Razor Clean, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Razor Clean operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Clean Edge Razor: Splitting Hairs in Product Positioning can be done for the following purposes –
1. Strategic planning using facts provided in Clean Edge Razor: Splitting Hairs in Product Positioning case study
2. Improving business portfolio management of Razor Clean
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Razor Clean
Strengths Clean Edge Razor: Splitting Hairs in Product Positioning | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Razor Clean in Clean Edge Razor: Splitting Hairs in Product Positioning Harvard Business Review case study are -
Ability to recruit top talent
– Razor Clean is one of the leading recruiters in the industry. Managers in the Clean Edge Razor: Splitting Hairs in Product Positioning are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Diverse revenue streams
– Razor Clean is present in almost all the verticals within the industry. This has provided firm in Clean Edge Razor: Splitting Hairs in Product Positioning case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Operational resilience
– The operational resilience strategy in the Clean Edge Razor: Splitting Hairs in Product Positioning Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Learning organization
- Razor Clean is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Razor Clean is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Clean Edge Razor: Splitting Hairs in Product Positioning Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Sales & Marketing industry
– Clean Edge Razor: Splitting Hairs in Product Positioning firm has clearly differentiated products in the market place. This has enabled Razor Clean to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Razor Clean to invest into research and development (R&D) and innovation.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Razor Clean digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Razor Clean has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Analytics focus
– Razor Clean is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by John A. Quelch, Heather Beckham can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Successful track record of launching new products
– Razor Clean has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Razor Clean has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Low bargaining power of suppliers
– Suppliers of Razor Clean in the sector have low bargaining power. Clean Edge Razor: Splitting Hairs in Product Positioning has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Razor Clean to manage not only supply disruptions but also source products at highly competitive prices.
Effective Research and Development (R&D)
– Razor Clean has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Clean Edge Razor: Splitting Hairs in Product Positioning - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Superior customer experience
– The customer experience strategy of Razor Clean in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management
– Razor Clean is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Clean Edge Razor: Splitting Hairs in Product Positioning | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Clean Edge Razor: Splitting Hairs in Product Positioning are -
Increasing silos among functional specialists
– The organizational structure of Razor Clean is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Razor Clean needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Razor Clean to focus more on services rather than just following the product oriented approach.
No frontier risks strategy
– After analyzing the HBR case study Clean Edge Razor: Splitting Hairs in Product Positioning, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Aligning sales with marketing
– It come across in the case study Clean Edge Razor: Splitting Hairs in Product Positioning that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Clean Edge Razor: Splitting Hairs in Product Positioning can leverage the sales team experience to cultivate customer relationships as Razor Clean is planning to shift buying processes online.
Capital Spending Reduction
– Even during the low interest decade, Razor Clean has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
High operating costs
– Compare to the competitors, firm in the HBR case study Clean Edge Razor: Splitting Hairs in Product Positioning has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Razor Clean 's lucrative customers.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Razor Clean supply chain. Even after few cautionary changes mentioned in the HBR case study - Clean Edge Razor: Splitting Hairs in Product Positioning, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Razor Clean vulnerable to further global disruptions in South East Asia.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Clean Edge Razor: Splitting Hairs in Product Positioning, it seems that the employees of Razor Clean don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Lack of clear differentiation of Razor Clean products
– To increase the profitability and margins on the products, Razor Clean needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to strategic competitive environment developments
– As Clean Edge Razor: Splitting Hairs in Product Positioning HBR case study mentions - Razor Clean takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Low market penetration in new markets
– Outside its home market of Razor Clean, firm in the HBR case study Clean Edge Razor: Splitting Hairs in Product Positioning needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High bargaining power of channel partners
– Because of the regulatory requirements, John A. Quelch, Heather Beckham suggests that, Razor Clean is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Opportunities Clean Edge Razor: Splitting Hairs in Product Positioning | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Clean Edge Razor: Splitting Hairs in Product Positioning are -
Leveraging digital technologies
– Razor Clean can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Using analytics as competitive advantage
– Razor Clean has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Clean Edge Razor: Splitting Hairs in Product Positioning - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Razor Clean to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Low interest rates
– Even though inflation is raising its head in most developed economies, Razor Clean can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Buying journey improvements
– Razor Clean can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Clean Edge Razor: Splitting Hairs in Product Positioning suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Sales & Marketing industry, but it has also influenced the consumer preferences. Razor Clean can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Razor Clean can develop new processes and procedures in Sales & Marketing industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Loyalty marketing
– Razor Clean has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Razor Clean can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Razor Clean can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Razor Clean in the consumer business. Now Razor Clean can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Razor Clean to increase its market reach. Razor Clean will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Razor Clean is facing challenges because of the dominance of functional experts in the organization. Clean Edge Razor: Splitting Hairs in Product Positioning case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Creating value in data economy
– The success of analytics program of Razor Clean has opened avenues for new revenue streams for the organization in the industry. This can help Razor Clean to build a more holistic ecosystem as suggested in the Clean Edge Razor: Splitting Hairs in Product Positioning case study. Razor Clean can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Razor Clean can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Threats Clean Edge Razor: Splitting Hairs in Product Positioning External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Clean Edge Razor: Splitting Hairs in Product Positioning are -
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Razor Clean can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Technology acceleration in Forth Industrial Revolution
– Razor Clean has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Razor Clean needs to keep up with the evolution of technology in the Sales & Marketing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Razor Clean.
Increasing wage structure of Razor Clean
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Razor Clean.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Razor Clean will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Consumer confidence and its impact on Razor Clean demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Regulatory challenges
– Razor Clean needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Sales & Marketing industry regulations.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Razor Clean in the Sales & Marketing industry. The Sales & Marketing industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
High dependence on third party suppliers
– Razor Clean high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Razor Clean needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Razor Clean with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of Clean Edge Razor: Splitting Hairs in Product Positioning Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Clean Edge Razor: Splitting Hairs in Product Positioning needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Clean Edge Razor: Splitting Hairs in Product Positioning is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Clean Edge Razor: Splitting Hairs in Product Positioning is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Clean Edge Razor: Splitting Hairs in Product Positioning is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Razor Clean needs to make to build a sustainable competitive advantage.
