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Gillette targets toxic men at 50% off

The power of virtue signaling. Gillette half price. Schick full price. Get woke, go broke. Neutral Bay Woolworths channel check.

Gillette – from toxic masculinity to transgender & morbid obesity

Gillette is free to advertise how it wishes. After the monster backlash against the toxic masculinity campaign which wiped 6% in value from the brand and caused a 22% fall in the following quarter’s profits, it is hard to see how the radical social justice warriors in the marketing department have not been fired. To shareholders, it was a massive fail. A YouGov poll of household grooming products before the campaign saw Gillette fall from 7th out of 45 brands to dead last after it. Yet the company has chosen to bet the house on more virtue signalling hoping it will eventually cut through to the masses. Get woke, go broke.

While there is absolutely nothing wrong with a transgender kid shaving for the first time, most will likely see this ad as nothing more than Gillette doubling down on the roulette wheel of “identity politics”. What point is Gillette trying to prove? The bulk of society is growing tired of being told how to think and what to say.

Yes, there are serious transgender issues in America. 130 transgender people have been murdered since 2013. It is a damning statistic. However, it is unlikely that anyone small minded enough to commit such a heinous crime will be swayed by a Gillette ad featuring a trans actor. Why does Gillette seek to force feed its version of socially acceptable behaviours on the 99.9% of its clientele that does not require it? It is patronising in the extreme. It is like attacking NRA members as murderers.

The only company in the world that can treat its customers with disdain is Ferrari. It wields so much power that it selects customers if they are deemed worthy of owning some of its limited edition offerings. Sadly Gillette is not Ferrari.

Gillette is rife with double standards. It has brazenly sponsored a Dutch racing car series with the brand embossed across the backsides of supermodels.

Chick-fil-A, on the other hand, was established on its Southern Baptist principles. It has never hijacked a social movement to boost sales.  That is why it has seen sales treble on a doubling of stores to become the third largest fast-food chain in America. It never rams its beliefs down the throats of others.

The toxic masculinity campaign should have been a big enough lesson for the marketing team to stay in its lane. The consumer spurned Gillette at the supermarket cash register. It would have been better coming out and apologizing and praising men for all the good things they do, like the Egard Watch company.

Virtually no customers will see that trans ad and think to buy Gillette razors out of a sense of moral guilt at the treatment of this minority. Consumers buy razors to groom – period. When will the company get it?

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It wasn’t so long ago that Gillette promoted a morbidly obese woman to push female shaving products. There is a difference between standing against fat-shaming and being realistic about the many chronic health issues and massive costs related to obesity.

The American Medical Association (AMA) wrote, “the nation’s obesity rate is approaching 40% after holding around 34–35% between 2005 and 2012, according to data in The State of Obesity: Better Policies for a Healthier America 2018. No state has had a statistically significant drop in its obesity rate in the past five years...the National Health and Nutrition Examination Survey (NHANES) showed that 39.6% of adults and 18.5% of children ages 2 to 19 in America have obesity, the State of Obesity report noted that “these are the highest rates ever documented“…the AMA is working to prevent and control chronic diseases, many of which are associated with obesity…”

We covered obesity in the previous post. Obesity increases the risk of developing type 2 diabetes, high blood pressure, heart disease, stroke, arthritis, sleep apnea, liver disease, kidney disease, gallbladder disease, and certain types of cancer yet Gillette wants to celebrate it as something to be proud of.

Corporations that pursue woke marketing risk alienating their customers. There is no upside to it. Consumers are not stupid and the more companies run campaigns that fly in the face of their intelligence, will only get a backlash at the point of sale.

Don’t forget that the toxic masculinity campaign had a 10:1 negative response ratio on the millions of views it had. One can be sure Gillette will try to massage a positive response on this latest campaign. Yet, like most polls, the most accurate measure is consumer response. If sales aren’t arrested, no matter how many positive clickbait statistics they can show their bosses internally, the sales and profit figures won’t lie. That is all that ultimately matters to P&G shareholders.

Gillette value cut by P&G

CM was at Woolworths this morning and noted Gillette products still deeply discounted. Schick products still at the standard price. Of note it is interesting to see that parent P&G, in its 3Q 2019 earnings release overnight, wrote:

“The most significant assumptions utilized in the determination of the estimated fair values of Shave Care reporting unit and the Gillette indefinite-lived intangible asset are the net sales and earnings growth rates (including residual growth rates) and discount rate. The residual growth rate represents the expected rate at which the reporting unit and Gillette brand are expected to grow beyond the shorter-term business planning period. The residual growth rate utilized in our fair value estimates is consistent with the reporting unit and brand operating plans, and approximates expected long term category market growth rates. The residual growth rate is dependent on overall market growth rates, the competitive environment, inflation, relative currency exchange rates and business activities that impact market share.

Is the last sentence related to ridiculous campaigns that attacked toxic masculinity? Did the YouGov poll conducted afterwards set off warning lights inside P&G headquarters? Before the campaign Gillette was ranked 7th out of 42 personal care brands. After it aired, it ranked dead last.

P&G went on to say, “While management can and has implemented strategies to address these events, changes in operating plans or adverse changes in the future could reduce the underlying cash flows used to estimate fair values and could result in a decline in fair value that would trigger future impairment charges of the reporting unit’s goodwill and indefinite-lived intangibles.

In either a positive or negative 25bp change scenario in the discount rate, an impairment cut of 6% has been factored.

A look under P&G’s “Grooming” division in these results and it becomes clear that revenues have plunged 8.1% and operating profits slashed 22%. For the 9 month period, it is 6.1% and 12.7% respectively. So it can be deduced that the Gillette toxic masculinity campaign has accelerated the demise. Only proves that customers don’t want politics attached to their products.

Noone needs ‘woke’ corporations. Why do corporations feel the need to become paragons of virtue? Just stick to the products and leave us to decide for ourselves on societal values. In Gillette’s case, attempts to correct customer behaviour have been a resounding failure. Oh, to imagine the excuse making inside the marketing department.

Gillette cheaper than Home Brand

A month after the Gillette toxic masculinity campaign, it seems that apart from all the Gillette razors remaining discounted vs Schick product at full price, even Gillette shaving foam is selling at a discount to the low cost generic Woolworths Home Brand. Talking about a shaving cut.

”We see the good in men”

The Egard watch company took the opposite view of the Gillette campaign. So much for equality!

The cost of Gillette’s virtue signaling?

Before the ads, Gillette wasn’t on sale and Schick was. Now it’s reversed. One store maybe but the timing seems coincidental.