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246 ENTREPRENEURIAL STRATEGIES

sold anyplace in the world. And millions of men all over the world used
a Gillette razor blade every morning.
King Gillette did not invent the safety razor; dozens of them were
patented in the closing decades of the nineteenth century. Until 1860
or 1870, only a very small number of men, the aristocracy and a few
professionals and merchants, had to take care of their facial hair, and
they could well afford a barber. Then, suddenly, large numbers of
men, tradesmen, shopkeepers, clerks, had to look “respectable.” Few
of them could handle a straight razor or felt comfortable with so dan-
gerous a tool, but visits to the barber were expensive, and worse,
time-consuming. Many inventors designed a “do-it-yourself” safety
razor, yet none could sell it. A visit to the barber cost ten cents and
the cheapest safety razor cost five dollars—an enormous sum in those
days when a dollar a day was a good wage.
Gillette’s safety razor was no better than many others, and it was
a good deal more expensive to produce. But Gillette did not “sell” the
razor. He practically gave it away by pricing it at fifty-five cents retail
or twenty cents wholesale, not much more than one-fifth of its man-
ufacturing cost. But he designed it so that it could use only his patent-
ed blades. These cost him less than one cent apiece to make: he sold
them for five cents. And since the blades could be used six or seven
times, they delivered a shave at less than one cent apiece—or at less
than one-tenth the cost of a visit to a barber.
What Gillette did was to price what the customer buys, namely,
the shave, rather than what the manufacturer sells. In the end, the
captive Gillette customer may have paid more than he would have
paid had he bought a competitor’s safety razor for five dollars, and
then bought the competitor’s blades selling at one cent or two.
Gillette’s customers surely knew this; customers are more intelli-
gent than either advertising agencies or Ralph Nader believe. But
Gillette’s pricing made sense to them. They were paying for what
they bought, that is, for a shave, rather than for a “thing.” And the
shave they got from the Gillette razor and the Gillette razor blade
was much more pleasant than any shave they could have given
themselves with that dangerous weapon, the straight-edge razor,
and far cheaper than they could have gotten at the neighborhood
barber’s.
One reason why the patents on a copying machine ended up at a
small, obscure company in Rochester, New York, then known as the
Haloid Company, rather than at one of the big printing-machine manu-