Tuesday, May 5, 2020

Aqualisa Quartz History free essay sample

Aqualisa who throughout the history in the U. K. held recognition for having top quality showers, a premium brand, and great service, feeling the market had yet to experiment any major innovations conducted a market research and developed the Quartz. In 2001 launched the Quartz shower; an innovative product that gathered all the characteristics the costumers felt were missing or deficient in the shower industry all at once. This shower provided improvements from water pressure, installation, temperature, maintenance, to use and design.During the field trials conducted lead by company’s employees, friends of friends and sales reps, the Quartz experienced great acceptance indicating a success in the confection of the product as well as positive reviews that featured on the cover of several journals, however despite its worthy features the sales were very deficient and far from the company’s expectations. Early sales results were no more than 81 units during a 4 month period. Their main marketing deficiencies were: Customers weren’t informed of the new product, sales representatives could not pursue a strong approach without affecting negatively the other products they offered and plumbers were very reluctant towards embracing new electrical technology. Also, Aqualisa who had a net income of about 17 million could not invest in a large consumer campaign which could cost from 17% to 23% its total revenue. Aqualisa’s market share ranked it number two in mixing valves and number three in the U. K. shower market the company.Also their market presence was very strong since it had leading products in all there pricing segments: premium (price range 230? to 1080? ), standard (price range 445? to 715? ), and value (price range 390? to 480? ). Allowing them to enjoy a 25% net return. Their range of products consisted of 9 showers distributed according to segment by trade shops, distribution, showrooms and DIY sells. The company used different brands to cover the market such as Showermax which tended to developers and offered the Aquavaulve redesigned and optimized to fit developer’s specific needs.Nonetheless the company had some weaknesses as well, other companies were competing in product quality, the market perceived Aqualisa as overpriced, their service had slipped over the past few years and 10% of their showers were presenting malfunction. Aqualisa’s sales force was oriented to spend 90% of their time maintaining existing accounts, however once the customer had purchased the product the follow up work was mostly maintenance, which the company did not provide and was instead done at the costumer’s expense through a plumber. But since the demand for plumbers was so high it would sometimes take more than 6 months to get a response. The remaining 10% was oriented towards developing new customers. A very limited amount of time for a new product that completely redesigned the shower as customers knew it, more time should have been invested in educating the customer and creating a sense of awareness and perception. Also with the new development came growth, a top notch team was built, engineers, research and development, sales director, marketing director, and a market research.However the sales team remained the same, despite the company’s addition of two new leading products. A 20 person team that had the responsibility to sell to trade rooms, showrooms, plumbers and developers. A strong sales team was needed to break from the stigma of the traditional shower and show the U. K. the revolution, to do this a greater number of people was needed. Aqualisa targeted loyal plumbers to explain and introduce the new product but this had very little success, since the plumbers had no expertise on the Quartz functionality or performance in the long run.Worried about future cost and follow up very few made the change. Plumbers influence over the markets shower selection was approximately 73%, they were responsible for direct installation of 54% of the showers installed and they had direct contact with value and standard customers. The salesmen were afraid to pursue a strong pitch fearing it would have a negative impact on their other products, since to sell the Quartz they’d have to list the deficiencies of their other product, to enhance the importance of the Quartz.This decision leads back to management the company then must have made a decision towards which product would be their star, the one who will allow the entrance to new markets, the one with th e highest margin, although it may replace their old models, there’s only so much market that one product can occupy and bring revenue. Although 32. 5% of showers were sold at Do-It-Yourself Sheds, 42% in trade shops and the rest in showrooms and electrical wholesalers, these were mostly value and standard segments where the margin went from 105? to 225?.Whereas the margin of the products sold at showrooms went from 60? to 345?. Rawlinson was debating marketing options to enhance company sales, these three options were: targeting consumers directly, targeting Do-it-yourselves, or targeting developers. As previously stated the problem with targeting consumers directly is that the cost it’s too high, as its too high risk to invest a 23% of revenue in large scale campaign, it’s been stated that customers know very little about the products they buy, and are mainly influenced by the plumbers.Targeting Do-it-yourselves could be an option considering the ease in the installation process, however it could damage company image because the customers would associate the premium brand with your discount channel. Targeting developers could equal to a strong presence in a large-volume channel. However developers are reluctant to spend money on what they believe were premium brands, regardless of the discount they received. After analyzing the case we have potential options that could help aid Aqualisa’s problem.Currently Aqualisa brand is present in only 500 showrooms out of 2000, showroom give brands the opportunity to present their product thoroughly, these people and are usually looking for something that’s attractive and easy to use. A stronger presence in showrooms is needed, incentivizing interaction between the consumer and the product, promote the technical innovation emphasize that the installation has been reduced to half a day, that no follow up was needed. Investing in strong consumer awareness campaign although the cost may seem be a bit high, the product will be surely to return this investment once alertness in created.Acknowledging that the Quartz isn’t a replacement for the Aqualisa but rather something different, with product enhance ments to make it easier and more approachable by the customer could help with the costumer image. Also according to the margin chart, the product has very high margins that can withstand any major invested in advertising if it’s probable it would increase the sales. Instead of focusing on just developers, I would turn all efforts onto the resort industry, where luxury and cutting edge technology is expected and price is not a primary factor.The marketing strategy would show primary efforts towards conquering the plumbers and considering that they amount of plumbers is only approximately 10,000 in the U. K. by reaching at least 25% of this total could translate into a major increase in sales, the Quartz should be primarily present in specialized retail stores, and trade shops which is where plumbers usually stock up. Since the trade shops usually just stock up on whatever the demand is for, creating that demand is crucial. Also in these trade shops trained personnel should be present to educate the customer on the new product since they don’t have the capability f managing the technical details of every product they offer. This would create much needed consumer awareness at a particularly low cost, and trigger a need to try it. If the company were to offer a free product to at least 20% of the plumbers the cost of 2000 units would be from 350,000? to 460,000?. This would help considerably to decrease the superstition of the electrical shower and by simple word of mouth would reach a big part of the rest of the plumber’s community, in this scenario the plumbers will become sort of our sales representatives.As we believe the importance of the plumbers perception is crucial since they are accountable for 73% of the decision of which shower to purchase. Besides the free product, a warranty for at least a year will be offered on all units sold, this merely would present an insignificant cost for the company since the product needs no follow up work, but it will create a sense of much needed security in plumbers and consumers.The strategy to be used towards plumbers most emphasize that it will no longer take them 2 days to finish a job, it will be done in less than a day, giving them the chance to take on more work and cover the high demand, while receiving more incomes. Work cited: Moon, Y. (2006). Aqualisa quartz: Simply a better shower. Informally published manuscript, Business School, Harvard, Cambridge, MA, .

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