The key takeaways for entrepreneurs from Gillette's strategic move to increase the price of its blades are:

1. Understand your customers' habits: Gillette knew their customers were used to their product and would continue to buy it even at a higher price.

2. Timing is crucial: Gillette increased the price of its blades after its patent ran out, ensuring it maximized profits while it still had a competitive advantage.

3. Don't be afraid to change your profit model: Gillette shifted its profit model and it resulted in substantial profit boosts.

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A startup can use the key topic of profit model shift to grow by strategically adjusting its pricing or revenue generation model based on customer usage habits, market trends, and competitive landscape. This could involve introducing premium features, subscription models, or tiered pricing. The example of Gillette in the book illustrates this concept. Once their patent expired, they capitalized on their customers' habits and began charging more for their blades, leading to substantial profit boosts. Startups can similarly identify opportunities within their business model to increase revenue.

The "profit model shift" as explained in the book "Ten Types of Innovation: The Discipline of Building Breakthroughs" refers to a strategic change in the way a company generates its revenue. This shift often involves a change in the company's business model or pricing strategy. In the case of Gillette, once its patent ran out, it strategically began to charge more for its once inexpensive blades. Customers, accustomed to the product, willingly paid more, resulting in a significant increase in Gillette's profits. This is an example of a profit model shift, where the company changed its pricing strategy to boost profits.

The case of Gillette's profit model shift has significantly influenced corporate strategies and business models. It demonstrated the power of strategic pricing and understanding customer habits. Once Gillette's patent expired, they capitalized on their customers' usage habits and began to increase the price of their blades, which were once inexpensive. Customers, accustomed to the product, paid more without much thought. This led to a substantial increase in Gillette's profits. This strategy, often referred to as the "Razor and Blades" business model, has been adopted by many companies across different industries. It involves selling a primary product at a low cost or giving it away for free, and then charging premium prices for related goods or services.

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Ten Types of Innovation: The Discipline of Building Breakthroughs

Stop wasting your time on brainstorming sessions that only improve upon existing offerings marginall...

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