Aqualisa Case
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[pic 1] Group Homework 1 Marketing – Aqualisa Case Prof. Andres Cuneo Section A – Team 5 The Quartz Value Proposition The UK shower market has generally remained unchanged for many years largely due to an archaic plumbing and construction system. At the moment the market provides various products to keep up with consumer needs but all the variations such as use, installation, temperature, pressure and price only fulfill a few required features. Hence we believe the Quartz value proposition lies in creating a product that addresses those needs and anticipates future desires for all users through one product. It is important to highlight that Quartz comes with value added features that ease the experience of both the plumber and end customer. Customer Type Customer Need being Addressed Quartz Product Value Proposition End Customer Temperature Control Automatic, accurate temperature control, in the hands of the user End Customer Design of shower head and visibility of Heating System Stylish modern looking shower head. Small, hidden heating system that can be placed in a remote location. End Customer Pressure Up to 18 litres/min vs 4 litres/min average in UK End Customer Installation Time Easy, clean and less technical installation process, cutting time down to half a day vs 2. Therefore a less cumbersome and expensive process. End Customer Easy to Use Simple button activation – no valves required End Customer Safety Kids and elderly can use the device without parental or safety control in place due to the easy and effective heating system Plumber Ease of installation Shoe box size that can be installed anywhere – no excavation required – Quick – push and fit style. Straightforward installation that an apprentice could complete Plumber Extra costs a plumber needs to take into account such as repeat visit or change in unit Simple and quick installation does not require repeat visit and under 5 year warranty by Aqualisa Note: As it is an innovative product, that might be too good to be true, it creates fear amongst first-time users, therefore the company needs to demonstrate and emphasize “the wow” factor more. Sales Strategy Analyzed The case offers three possible solutions to Aqualisa in order to generate sales momentum for their newly innovated brand “Quartz” (analysis shown in the table below). Based on our evaluation of the company’s value proposition, channels through which the product is sold and how the purchase decision happens in the market of showers we believe the company would be better off targeting the plumbers.
Strategy Strengths Weakness Option Evaluation Cost to Impleme nt Ease to Impleme nt Impact on Sales Targeting Consumer Directly Problems reaching the plumbers, so target final customers Build consumer brand 25% of customers directly buy Customers not knowledgeable about products and cannot actually do the installation Expensive and tough to sell across the company. Advertising campaign could cost up $3-4 Mil in 2 years. Very High Low Low Targeting DIY’s Emphasize the ease of installation. By-pass the plumbers who are hesitant to adopt the new technology. Expose client’s directly to the brand via B&Q – less expensive than marketing campaign Premium brands not typically associated with DIY Currently Gainsborough brands are only available through DIY shops May dilute the Quartz product’s Brand Value Low Low Low Targeting Developers You could boost sales quickly because they are big customers. New buildings would “force” plumbers to adopt Quartz Time-to-market: Time span to reach the customers is about 2 years. Market Size: Only 15% of shower market is new buildings Low Medium Medium Targeting Plumbers 40% presence in trade shops where primary consumers are plumbers 54% of shower installation is done by independent plumbers 73% of mixer-shower buying is being influenced by the plumbers Plumbers are afraid of new technology as they need to fix the installation problems on their own cost Electronic devices failed in 1980’s leaving plumbers averse of promoting electronic valves Medium Low High Note: We evaluated each of the options based on the following 3 criteria and ranked them from low to very high[pic 2] Cost of implementation: based on the data provided in the case, we evaluated the monetary cost of implementing each solution. The ease to implement: reflects the company’s competencies to deliver strategy. The impact on sale: important since Aqualisa is trying to boost the sales of the Quartz shower. We recommended marketing to plumbers via an implementation plan that would consist of the following set of actions: 1) Offer a (mail back) rebate on the first 4000 units sold (inclusive of both models). 2) Educational and demonstrative workshops for plumbers. This would show the plumber the benefits and value of the new model, in terms of installation and maintenance cost and time. Additionally it would help build a stronger relationship with independent and company plumbers that would result in future value.