Company Profile “Shower Solutions” company, in 2nd place Currently involved in different consumer market segments Value Standard Premium consumers Different Channels of Distribution: Trade Shops Showrooms DIY Plumbers!
Aqualisa Quartz • Digital Technology • Competes in Mixer and Power market segments
Key Issues Time e Slow ow Prob r l ob e Sensitivit Sales e m y
Segments & Channels Rea R ching ng Cust Cus om t ers er Tr T ade r Sho h p o s p DI D Y She S ds Sho S w ho r w o r o o m o s m Channels Plum u be m rs r Middleman Customer St S a t ndar n d dar Val V ue al DIY Pre Pr mi m um u Dev De e v lope o r pe s r
Shower Selection Process Mixer Showers Consumer selects type & brand of shower alone ; 27% Plumber influences type of shower, not brand; 20% Consumer takes plumber's advice ont ype & brand; 28% Plumber selects type & brand alone; 25%
Quartz Product Analysis Quartz Attributes Customer Differentiation Price Hi-end Easy to Looks segments factors match product instal Great Reliable Value Total Cost ü customers Convenience ü Standard Performance ü ü ü customers Service ü Premium customers Style ü ü ü DIY Low price customers Easy to instal ü Reliable ü Nice Looking ü Developers Flexibility Price Sensitivity
€2,590 €2,440 Premium Mixer/Boosted €1,995 Standard €1,950 Mixer/Boosted €1,800 €1,670 Standard Mixer €1,440 Quartz Power €1,355 Value Mixer €1,240 €1,170 Quartz €1,080 €1,010 Standard €990 €830 Standard Power €800 €640 Value Power €550 Developers DIY Mixer €390 €285 €155 DIY €95 Electric
Suggested Alternatives Partner with B&Q and 1) Market as a DIY Brand focus on ease of installation 2) Market as a Developer For new home builds. brand 3) Market as Develop consumer consumer brand awareness via advertising 4) Market to Market push to influence plumbers consumer demand
Pros and Cons of Alternatives Pros Cons •Ease of install •Price mismatch 1) Market as DIY appeals •Damage brand •Channel partners •Few developers •Long lead times 2) Market to •High volume •Price mismatch Developers •Builds brand •Awareness fades 3) Consumer •Wide coverage •Not decision makers Awareness •Costly •Key influencer •Risk aversion 4) Target •For large segments •Resistance to change Plumbers •That values Quartz •Price match
Justification Value/Standard segments can support goals. 100 to 200 units / day Quartz total price fits these segments. Quartz features fit these segments Convenience, performance, service Plumbers influence Value & Standard segments. Plumber concerns can be over-come. Electronics, reluctance to change, risk aversion A relationship with a plumber lasts. Consumer awareness declines over time. Previous campaign didn’t follow AIDA model.
AIDA Model gn ai p am C s ss ne ene r ar Awa l ai M t ec r i D • y nt rra Wa
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Implementation Plan Two phases: I. Phase 1: Preparation phase II. Phase 2: Campaign launch
Implementation Plan Phase 1: Preparation phase Campaign Management Team Initialize the launch phase Follow up on results , report to Rawlinson Hire new sales force (three) Acquire plumber database (Mail, Phone, Brand,…) Brochure Development and design
Implementation Plan Phase 2: Campaign launch Loyal Plumbers: Contact the plumber, send the brochure and free trial. Follow up with them about the installation process and their opinions. Regular Plumbers Send the brochure, call the ensure it’s delivered . Periodic follow ups.
Implementation Timeline 2001 2002 Actions Oct No Dec Jan Feb Ma Apr Ma Jun Jul Au Sep v r y g Phase I Management Team Hire Sales Force Acquire database Developing Brochure Phase II Sending Brochures Fol ow ups
ROI Analysis Calculations Optimistic Pessimistic Most Likely # of plumbers offered 4000 4000 4000 % of plumbers accepting 70% 30% 50% # of plumbers to accept 2800 1200 2000 Plumber installs/year (avg) 50 40 45 % Plumbers working for customers 54% 54% 54% Number of customer plumbing install/year 27 22 24 % where plumber influences choice 73% 73% 73% Influenced Customers per plumber 20 16 18 New Quartz installations 55,188 9,461 35,478
ROI Analysis cont. Financial Impact: Optimistic Pessimistic Most Likely Profit generated by € € additional sales € 17,108,280 2,932,848 10,998,180 Fixed Costs € 110,000 € 210,000 € 160,000 Variable Costs € 751,800 € 427,800 € 557,000 Total Costs € 861,800 € 637,800 € 717,000 € € Gross Profit from program € 16,246,480 2,295,048 10,281,180
Contingency Plan Continuous and real-time monitoring – will help to evaluate degree of success Increase rate of follow up contact to plumbers Increase the number of plumbers targeted Revise materials and/or offering