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<a href="http://www.accessmylibrary.com/coms2/summary_0286-9528575_ITM" title="Facts and information about Route to a brand's best strategy: new findings challenge the belief that market share alone correlates with profitability. Bain & Company's analysis of 200 brands shows that products at the high end stand to earn considerably more with a smaller share of the overall product category.(Sounding Board)">Route to a brand's best strategy: new findings challenge the belief that market share alone correlates with profitability. Bain & Company's analysis of 200 brands shows that products at the high end stand to earn considerably more with a smaller share of the overall product category.(Sounding Board)</a>
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Route to a brand's best strategy: new findings challenge the belief that market share alone correlates with profitability. Bain & Company's analysis of 200 brands shows that products at the high end stand to earn considerably more with a smaller share of the overall product category.(Sounding Board)
Conventional wisdom holds that market share alone determines profitability for branded consumer products. But that masks the full story. Consider what happened to The Gillette Co. after its main competitor Bic introduced low-cost disposable razors sold by the bag in the mid-1970s. Gillette, the global leader in razors, responded with its own razors in bags.
Yet Gillette's brand managers soon realised that even if they maintained a majority share in a value-oriented category, pre-tax operating profit, or return on sales (ROS) would be restricted to only 5-10 per cent. They looked for another road to profitability. Gillette invested more than $200m in research and ...
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Source: HighBeam Research, Route to a brand's best strategy: new findings challenge the belief...