While the safety razor and the electric shaver have thoroughly conquered the U.S., many Europeans still strop their own razors or visit a barber for a shave. This naturally makes Europe highly attractive to the world's razor-blade makers. Throat-cutting competition for the market is raging between Boston-based Gillette Co., world's biggest producer, and Britain's Wilkinson Sword Ltd., whose introduction of the long-lasting stainless-steel blade changed the whole nature of the market (TIME, May 1). Stainless blades now account for almost 70% of British blade sales, 35% of the German market, and are increasing fast in other countries as delighted shavers try them. So far, smaller Wilkinson has been holding its own against Gillette.
Badly Nicked. Last week Gillette started distribution in Britain of a new stainless blade that will sell for less than both present Gillette and Wilkinson blades.* Gillette's new Seven O'Clock, which sold under that name in traditional carbon steel, will be 14¢ less for a five-pack than Gillette's premium Silver stainless or Wilkinson Super Sword-Edge. By bringing out an established name in stainless, Gillette hopes to hold the old Seven O'Clock market while luring away Wilkinson shavers who never tried Gillette's Silver blades. In Germany, Gillette has also switched a well-known Gillette blade name Rotbart (red beard) to stainless, hoping to beard Wilkinson in the same fashion.
Gillette needs a breakthrough. Unlike Wilkinson, which makes only stainless blades, Gillette frequently has to fill one pocket from another as customers switch from its carbon blades to its stainless. This shift, along with high promotion costs for the new blades, has badly nicked Gillette profits. From record 1962 earnings ($45.3 million) the company slipped 8% in 1963 despite higher sales, lost another 11.5% last year. Gillette's British subsidiary cut its employee force 5% last summer, discontinued longtime fair-trade prices on blades and hiked retailer discounts to stimulate sales.
Wary Watching. The new marketing moves, Gillette feels, will once more give earnings that old smooth feeling. Even so, it warily watches Wilkinson, which now sells in 50 countries (v. Gillette's more than 100) and quietly slipped into France recently with low-key ads that announced: "Elle est arrivée—the Wilkinson Super Sword." In both France and Italy, Gillette produces lower-priced brands similar to Seven O'Clock that will be converted to stainless if the war heats up. Meanwhile, it receives royalties regularly from Wilkinson, whose blades and bustling business are based on a 1959 Gillette patent ignored until Wilkinson came along.
*Gillette is also testing a cartridge razor in which the shaving surface is a continuous reel in place of individual blades; the shaver turns a knob to advance the reel when an edge becomes dull.