Rev. November 12, 1997
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Early in1989, John Symons, head of Gillette's North Atlantic Shaving Group, was reviewing
the strategie plan for the launch of the Sensor razor (see Exhibit 1). After more than 10 years of
development,Gillette had already sunk more than $75 million for R&D and $50 million for capital
equipment into the project. Sensor was now less than a year away from launch but if Symons had his
way, an evengreater amount of expenditure for the launch lay ahead. Specificaily, Symons planned
to mount a global advertising blitz costing more than $100 million and to build two plants
simultaneously, in Bostonand in Berlin, Germany. Together with investments in building up
inventory, the launch, as envisioned by Symons, might cost Gillette another $150 million.
Not everybody agreed with these aggressiveplans. Sorne thought that Gillette should launch
Sensor more graduaily, starting in a few markets, gauging reactions, adjusting its marketing
campaign accordingly, and building up awareness of theproduct over time--an approach that might
reduce by more than half the launch costs that remained to be committed. Others, worrying about
cannibalization, wondered whether it might be premature tolaunch a new product in January 1990.
Gillette's Atra and Good News! razors were undisputed leaders in the cartridge and disposable
segments respectively, and each had just finished a year of recordsales and profits. And a few even
questioned the wisdom of placing so much emphasis on an advanced (and expensive) cartridge
product in a market where low-cost disposable razors had steadily beentaking share away from
cartridges. As one manager expressed it, "The question is whether you put ail your eggs in one
basket or recognize a segmented market."
Gillette's CEO, Colman Mockler, Jr., who...