Gillette Safety Razor

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didn’t introduce any other products during this time. This could be an issue when starting up a new product line, so we will want to try and allocate more of the sales force’s time after the product is up and running to ensure that we don’t fall behind the competition.

Target Market

Since it is believed that two of the main consumer groups who use cassette recorders are either using it as students to take notes and record lectures and by business people for dictating and recording conferences, it would make the most sense to target the age group of 20 to 29-year-olds who make up 34.7% of the US population. This is because 45% of this age group already own cartridges but only 27% own cassettes. It can also be generally assumed that this age group will fall under the $5,000/month and under household income because these are young adults who are either still in college or are still starting out their careers. This is also the largest income population in the US, so we will have a larger target audience to market to.

Plan of Action

I believe it would be in our best interest to use the Gillette name brand, simply due to the fact that the current blank cassette market is saturated with very poor quality products. If we associate with the Gillette name it will help communicate to consumers that they are quality tapes because they come from a quality brand that they know. We can hopefully use this as our competitive advantage because we do not have any other functional advantage over other brands.

SRD already distributes to four out of the eight retail stores that blank cassettes are currently sold at. These four stores represent 67% of the unit sales from the eight stores. I think this distribution is a great place to start, and when we have developed the blank cassette Gillette brand and it is more recognizable we can think about expanded into stores that cassettes are not currently sold at.

After computing the contribution margin, and break-evens, our best bet is to go with the professional quality cassettes, since they will bring us to the break-even point with half the amount of unit sales.

Recommendation

I recommend that SRD enter into the blank cassette market, under the Gillette name, targeting the 20 to 29-year-old students, and young professionals utilizing the their current distribution of discount stores, drug stores, variety stores and catalog stores. Suggested at the price of $2.95 to end consumer, and at $1.48 to retail.