John Philipp loves my coffee so much, here at Over Coffee, he's willing to come and drink my coffee and make us laugh this morning. Grab a cuppa and something to munch and have a *set* and enjoy his *philosophizing*.
Razors were once touted as an example of American business innovation. Shaving was hard and dangerous. As a result, a lot of men wore beards. Then the safety razor was invented and practically given away(gasp!). It was only later that people understood the Machiavellian motive behind this bold marketing move. You got it, now whatcha gonna do with it? Buy our blades of course.
- NOTE: The term "safety" in safety razor is used to indicate that because most of the business end of the blade is nestled inside the razor, you can't slit your throat accidentally as you could with a straight razor. You can still nick yourself until you look like the "before" picture in a Clearasil ad but it's unlikely you'll bleed out.
The safety razor was introduced at a time when the American economy was unsaturated, which means that people had more money than there were products they wanted to buy. (From time to time I invent terms to make a point. This is one of those times.)
This was also a period when a man named King Gillette owned the Gillette Company outright. As the company grew it went public and hired professional managers.
When managers who are not owners run companies, several things happen. One, the managers develop a nasty rash because they know they can be fired on the whim of the board. Two, because a chronic rash wreaks havoc with a manager's social life, he avoids the rash by doing everything he can to make profits improve every quarter.
Television caused the American economy to become saturated. Some economists think it was billboard advertising but they forget that you have to drive by a billboard for it to have any impact. A television set just sits in your living room, daring you to turn it.
Steady revenue and profit growth is no problem in an unsaturated economy. When the economy becomes saturated — when there are more things to buy than money to buy them with — American business managers are forced to adopt new strategies.
One thing managers do is improve the product. Often this is accomplished by altering customer perception, such as changing the color of the product and adding the word "Improved" to the packaging. When that wears off another cosmetic change adds the words "New & Improved."
The second tactic businesses use to maintain growth is to hound its customers by increasing advertising. An ad will show sad people with the "old" product and happy people with the "new" product. The consumer, always wanting to be in the happy group, rushes out to buy the new product.
Back to the razor story: Gillette made a fortune selling blades. One day some still-wet-behind-the-ears MBA who didn't know any better asked why the company couldn't make a profit on its razors as well. Foreheads slaps all around the boardroom.
With the concept of a razor that actually makes a profit firmly in mind, Gillette's corporate research department rose to the challenge and created a new razor. How to get consumers to buy a new razor? Simple. Create a new and improved razor blade, say one in a cartridge that requires a new razor to hold it. No one is sure to this day why a cartridge blade is any better than the old blade, but there it was on television every day, being used by happy people, and the American consumer just had to have one.
This set the stage for a decade of continual cartridge improvement, adding an additional blade each time. Of course, each new cartridge needed a new razor. Corporate profits were off the charts to which companies responded by buying bigger charts.
But the managers got greedy. They forgot that too many improvements could come back and bite them in the butt. While each extra blade added marginally more cutting surface, it also created a place for cut hairs to congregate, clogged the blades and thereby diminished the effective cutting surface. The net out is that the new five-bladed razors are worse than the old safety razors.
When they add the sixth blade I believe beards will come back in style.