Dear Mr. Ralph Bingham,
After thorough analysis of your company’s history, its strengths and weaknesses, I would like to make a few recommendations regarding your decision to enter the blank cassette tape market.
Gillette has dominated the razor blade market for quite a while now. Its success can be mainly attributed to the high quality of its products. Gillette is in a great position to enter this new market offering the highest quality products available, but still reach the masses through reasonable prices. Gillette has a great reputation for offering top quality products. Therefore, by keeping the prices comparable to other brands, Gillette has the brand advantage. I would not recommend charging a premium price at first. This would allow early adopters to become avid users and later assist in the introduction of new users. Prices should be set at $2.95 for professional quality, $2.00 for standard quality, and budget quality products should not be offered to avoid branding the product as “cheap”. These prices are comparable to the prices offered by current leading brands. Gillette should attempt to create high quality hard cases for all its products, differentiating it from most brands. Once again, using the current resources available at the company can be extremely advantageous in this new venture.
Since Gillette has been a great advertiser of its products, it should take advantage of this experience and heavily invest in advertising. Because of the relationships with different media, Gillette can and should be able to broaden its reach through effective and clever media plans. Leading brands currently do not spend much in advertising. This would allow Gillette, as a new entrant, to guarantee higher exposure.
We should expect approximate sales ...