Aqualisa Quartz simply a better shower Lukman Kresno O. 29110394 Yohanes De Deo Tedo 29110399 Anggi Fitrining Tyas 29110400 Ronaldo Bagus Putra 29110404 Wisnumurti Rahardjo 29110412
Background Aqualisa innovate a breakthrough product (Quartz) to the market but it was unsuccessful in the market because of Plumber’s Electronic Syndrome.
The U.K. Shower Market Electric Showers • heating elements instantaneously heated the water to the required temperature, eliminating the need for a boiler to store hot water. • convenient for small bathrooms, the electrical components were usually mounted in a bulky white box that was visible in the shower stall. • did nothing to address the poor water flow of many showers in U.K. homes, • sold mostly under a separate brand name, the ‘Gainsborough’ brand.
•Valves came in two types : •thermostatic controlled temperature automatically •manual manually find the right temperature •Installing a mixer valve meant excavating the bathroom wall. •Add booster pump to boost water pressure (cost € 350 to € 600) •Core Product: Aquavalve609 (thermostatic); Cost : €155 Price : €675 to €750 • Sales: 60,000 units per year; Image : high-quality and reliable Mixer Shower Valves
•Combine a thermostatic mixer valve and booster pump •Bulky box on the wall •Core Product: Aquastream (thermostatic); Cost : €175 Price : €670 • Sales: 20,000 units per year •Aqualisa’s strongest selling shower in the power shower technology Integral Power Showers
Pricing Segment Premium Segment Consumer : - Shopped in showrooms - Granted high performance and service - Style determined selection Standard price Segment : - Emphasize performance and service - Product selection rely on plumber Value Segment : - Concern with convenience and price - Avoid solutions that required any excavation - Product selection rely on plumber - Concerned with convenience and price Do-it-yourselfers Segment : - Shopped at large retail outlets - Interested in inexpensive models that were easy to install, even though bulky and unattractive - Overwhelming choice : Electric showers - Popular among landlords & apartment dwel ers
Product & Price
Distribution Gainsborough DIY / Value DIY sheds buyers Distributor Showrooms Premium Buyers 609, Quartz Trade shops Standard / Pl P umbers r Value buyers Shower Max Developers New Home Buyers
U.K. Market Share Data
U.K. Shower Sales by Sales Reason for Installation The principle reason for Replacement S hower consumer to install a shower is to replace the old shower into new 10% New penetratio n ones (44% of customers) 15% 44% commercial 6% There are only 6% of consumer who has a commercial purpose in New Build 25% installing a shower Second Sgower
The Quartz Shower Valve
The are 2 versions: The Quartz Standard Shower The Quartz Pumped Shower To install the Quartz shower: – the plumber had to identify a physical space to accommodate the remote processor – The processor contained the thermostatic mixing valve and pump – The device could be mounted horizontally, vertically, or on its side, depending on space constraints With Quartz technology: – Installation time of a half-day – Plumbers were finding that the install was so straightforward – The Quartz shower provided efficient and reliable water pressure and temperature – “one touch” control – the temperature control is automatic
Quartz Value Proposition VALUE Easy to instal PLUMBERS More profitable – able to do more instal ation Take 0.5 day to instal which is only 25% of previous times Even apprentice can do the instal ation Efficient and reliable water pressure and temperature Safe to use for kids and elder people CONSUMERS One touch control with red light indicator Much easier to instal for DIY sector Excel ent design and aesthetics, which increases ownership pride
Cost and Benefit Individual Developers Plumbers Premium DIY Price Sensitive Don’t like &Standard innovation CO Low brand Change premium Smal market Costly to S awareness brand perception convert T Independent of Large market Largest market B plumber share E influence NE Influence plumber FI Premium brand Cheaper Strong T recognition influence to customer
PROBLEM HIGH INNOVATION & TECHNOLOGY but LOW IN SALES Rawlinson should choose appropriate marketing strategy to overcome the problem. The choice are : - Targeting customer directly - Targeting developers - Targeting DIY
Co C mp m a p ny n Co C mpe p tit e o tit r Cu C st s o t mer e 5C 5C Co C nt n e t x e t Co C llabo ab ra r t a o t r
COMPANY • UK shower manufacture • Have breakthrough in shower technology by producing “The Quartz” • Have strong reputation in UK shower market. • Producing premium product in shower market.
Organizational Chart Aqualisa using the working divisions/department based. Consist of: Marketing & Sales, Finance, Technical, and Operations.
Cus Cu t s o t mer Collab Col or lab a or t a o t r Cont Con e t xt e • Individuals • Outlet • In UK, everyone had a bathtub, • DIY • Developers only 60% had • Developers • Trade shops showers. • It is rare an • Plumbers • Showrooms innovation in • Distributors shower production.
COMPETITOR UK Market Share Data : Units Sold (2000) Total Unit Sold by Brand Triton Mira Gainsborough Aqualisa Masco Ideal Standard Heatrae Sadia Bristan Grohe Hansgrohe Others 1% 1% 15% 30% 1% 2% 3% Triton has the biggest market 7% share (30%). 7% 11% 22% Aqualisa and Gainsborough market share is the 3rd largest (18%). For the Electric Showers product, Aqualisa and Gainsborough has 2nd biggest market share (16.9%) .
4P Analysis Product Price Place / Distribution Promotion Showers with Various Premium Trade Shop Advertisement categories. Standard Distributor (ex. Brochure) Type of Shower : Middle-Low Showrooms Web - Electric Shower DIY Outlets - Mixer Shower - Power Shower
S T P Segm g e m nti n n ti g n • UK Niche Market Shower Tar T g ar e g ti e ng n • Direct consumer • DIY market • Developers Pos P i os tion ti i on ng n • Leading in shower technology that have top quality shower in premium brand and also give great services
Weakness Str t e r n e gt g h t Weaknes • Lo L w o w sale al in Tr T a r d a e shop and • Str St o r ng g re r puta t ti a o ti n in i the UK U Show o r w o r oms m . • show o e w r rmark ar e k t e . • Ex E pensiv i e v bran r ds im i age ag • Hi H gh g Mark M e ark t e tshare ar • 10% 10% of fAquali al sia isi def e e f cte t d. • Hi H gh g Quali al ty t y Pro Pr duct c • Lac L ke k d the abiliity y to t re r la l t a e t to t end • Eas E y as y to t in i st s al t l al users r . • Hi H gh g innov o a v ti a on in te t chnolo l gy g SW S O W T O Opportu rt nity Thre r at a • Ty T p y ical c l al y y lo l w o w pre r ssure r and • Plumb m ers r lo l y o al y al to t sin i gle l bran r d and • fluct c uati a o ti ns in te t mp m era r t a u t re r of fUK K dis i t s rust s e t d innov o a v ti a on. show o e w r val v ve v s. • Oth t er co c mpanies we w re r ca c t a c t h c ing g up to t • High g deman m d of fUK U mar m k ar e k t e Aquali al sa a pro r duct tquality t . y • Rar R e ar re r al al bre r akt ak h t ro r ugh g in th t e • Dependency c y of Co C nsumer rto t th t e show o e w r mark m e ark t e .t plu l mbers r .
Products and Price Points •Quartz stand for Premium segment with price €850 and €1,080. • Quartz standard and pump provide the biggest margin than other models.
Consumers Consumer doesn’t like! •Poor Pressure •Varying Temperature •little understanding of product options •Shower broke down or “went wrong” hard-to-turn valves, leaky seals, and worn-out •Brand awareness was low; showers. Because of that, almost half the U.K. shower market consisted of sales of replacement •Prices to consumers usually lump showers. sums and unaware how costs broke down (labor, material, excavation, •Consumers were generally uninformed about etc). showers.
Developer • Most developers did not worry about pressure problems because new homes were almost have high-pressure systems. • faced a different set of issues, preferring reliable, nice-looking products that could work in multiple settings. • price-sensitive except of luxury builders • Developers usually had relationships with independent plumbers. • Aqualisa sold to developers under its ShowerMax brand, which was available only through specialist contract outlets. • technology had been redesigned, rebranded, and optimized for developers specific needs. • ShowerMax could deliver a high-pressure shower withAquavalve technology at a significantly lower cost.
Plumbers •Had high technical expertise. •Strong influence toward consumers. •Consumers ofen had to with six months •Charge about € 40 to € 80 per hour. •Loyal to single brand •Distrusted innovation → cause Quartz failure in the market.
U.K. Mixer Shower Market, by Installation Method • The most installation method of mixer shower is by independent plumber which is 54% of all. • While the installation by showroom and developer is 20% each. • The smallest percentage is the commercial installation which is only 6%.
Type of Influence Informational Con o sumer r must s t kn k ow o th t e ad a va v n a t n a t ge g s e of Aqu q alist s a t so o th t e h y e cou c l ou d dire r ctl ct y y buy y th t e prod r uct c or or as a k th t e plumber r to t use Aqua u list s a t on on th t eir rwa w s a h room r Plu Pl m u bers r must s t un u ders r t s a t n a d th t e h wa w y a y Aqual a ist s a t a wo w r o k k so o th t ey e hav a e v no u o ncert r a t i a nt n y t on o using n Aqu q alist s a t ’s pr p od r uct c s t
Shower Selection for Mixer Showers takes plumber 's advice on ty pe and brand Most consumer, selects Mixer Shower by taking plumber’s advice on consumer sele type and brand of shower which is ct type and br 28%. 20% 28% and alone 25% 27% plumber selec t type and bra While 20% of consumer are nd alone selecting only type of shower – (not the brand), that influenced by the plumber influ plumber. ences type of shower, not br and
Consumer Motivation & Value Needs d (Show ho e w r) Cons n um u er er Wa W nt n s t Plu P mber er Wa W n a ts n (loo (lo k o e k s gr s e gr at a , de , live v ry go g o o d d (easy to install, with a pre pr assure assur , s , t s able t
(easy to install, with guarantee not break down or te t mpera r t a ure ur , e , asy as to t o use, guarantee not break down or requiring service) didn’t bre r ak do ak w do n) requiring service
Latent & Manifest Motive It’s look great , easy to use, good pressure, stable temperature, didn’t break down Premium Purchase a brand makes SHOWER me more prestiges The plumber suggest me to buy that brand and that type
AQUALISA STRATEGIC ANALYSIS Pro Pro Pro • Quartz’s superior • Triton Has Proven that it can be value proposition done so possible to • Large-volume • Many Problems reaching the charge a premium channel. plumbers for this product. • Force plumbers to get familiar Cons • The Quartz is so easy to install. with our product • Currently selling • ‘bet the company’ its Gainsborough kind of product in this market • Cost about €3 to • Push the product, €4 million over 2 Cons avoiding the need years for expensive • • Tough to justify a consumer Time lag before showers high-risk, high- advertising Cons reach consumers through reward strategy this route. when company • Developers perceived • Associating results were products to be premium premium brand already healthy brands. with discount channel • Quartz under price was a breakthrough innovation.
Recommendation • The cause of quartz failure is the resistance from plumbers. With the analysis of circumference, they should : - Plumbers shoot the trade shop product presentation (installation, warranty) to the plumber community incentives - Consumers Bring the Brand experience to customer through its marketing activities, so that customer can feel the simplicity of Quartz shower. - Developers make a contract incentives