It was a startling disclosure for a corporate icon whose brands include Crest toothpaste, Tide detergent, and Pampers diapers: in the second quarter, the Gillette Fusion razor reached $1 billion in annualized sales in just two years, faster than any product in Procter & Gamble Co. history.
That may have nicked a few egos at One Bic Way in Shelton.
Two years after launching its new Soleil razor in the United States ”“ and after relocating its U.S.Milford to Shelton ”“ Bic Corp. said it had reached its market share objectives for the razor of between 5 percent and 10 percent of the U.S. market through June. headquarters from
Despite the new product line, the France-based company”™s shaver sales dropped below $100 million in the second quarter, down 6 percent from a year ago, in part due to the U.S. dollar”™s low value compared to the euro. For the remainder of the year, the company expects shaver sales to increase by a few percentage points.
That would be a victory in light of an overall U.S. market that shrank 3 percent last year, according to Mintel, a market research firm that follows shaver sales. Mintel predicts the market will decline another 1.8 percent this year and will trend downward through at least 2010.
Mintel attributes the dulled sales to several factors, including razors that last longer; continued electric shaver sales; and demographic trends, with population increases counterbalanced by aging people who shave less often due to hormonal changes; younger people opting for the stubble look; and even an increase in telecommuters who only have to look themselves in the mirror each morning.
Bic did not invent shaving, but it does claim credit for the first one-piece shaver in 1975, 30 years after two French entrepreneurs launched the company to make ballpoint pens.
It is Gillette, however, that has proven the most innovative in recent years, despite analyst criticism two years ago after initial sales for its five-blade Fusion razor proved slower than expected. It was Gillette that upped its blade count to five razors, padding its profit margins on razors. It was Gillette that added a battery-powered vibration mechanism to its razor, in one stroke helping boost sales of P&G”™s Bethel-based subsidiary Duracell. And it was Gillette that anted up to recruit Tiger Woods, Roger Federer and Derek Jeter for its newest ad campaign.
Still, while Fusion helped Gillette boost shaver sales 7 percent between 2005 and 2007, Soleil helped Bic eclipse that mark with a 28 percent increase in sales during that period, including 9 percent last year when shaver sales accounted for 18 percent of Bic”™s $2.3 billion in total revenue.
While the unit trailed stationery equipment and lighters among major Bic revenue categories, it had easily the fastest sales growth, thanks to Bic”™s own marketing brainstorms such as adding lavender scent to the handles of its Soleil women”™s shavers.
In Bic relocating 350 headquarters employees to Shelton, Milford was stripped of much of the operations of its third-largest taxpayer, with the company contributing $44 million to the town”™s coffers in 2004. At its peak, the plant produced 2.5 million razors and 3 million ballpoint pens.
Only time will tell whether Bic”™s Shelton office will begin marketing a fourth major product line in the United States: prepaid telephones. In partnership with the European mobile carrier Orange, the company began selling mobile phone service this month in its home country of France.
