Aqualisa Case Essay
The UK shower equipment market grew by 0. 1% from 2000 to 2001 to reach a value of ?588 million in 2001. Market value has increased steadily , totaling nearly 12% for the period 1997 to 2001. Shower products for the domestic and commercial sectors are distributed through a wide range of channels. The main distribution channel continues to be builders and plumbers merchants with the DIY multiples also holding a substantial share. Other retail channels include bathroom specialists, grocery multiples, mail order retailers and department stores.
The shower market is highly fragmented (electric, standard mixer and power shower) but three brands continue to dominate – Mira, Aqualisa and Triton, controlling~70% of the market. Aqualisa is an innovative shower manufacturer with the 3rd highest share in the UK shower market in 2000. In May 2001, Aqualisa launched Quartz, a technologically advanced product that was expected to greatly improve the shower experience and gain a large market share. About 60% of U.
K consumers are going to buy at most two showers in their lifetime and because key influencers in the decision making process like plumbers where ressistant of adopting the new technologies. Majority of the UK shower market is made of replacement showers which leeds to the company’s poor sales. The plumbers influence in the consumer’s shower selection is significant (they have an influence in 73% of mixer shower selections) and the reluctance of plumbers to adopt the Quartz shower has been a considerable factor affecting its sales.
Plumbers tend to remain loyal to their selected brand as it is the most comfortable for them in using when installing because of their previous experiences. As a consequence, they are often unwilling to switch to unfamiliar products that may present installation or performance issues that could require a second visit, costing them time and money. In addition, Aqualisa have been unsuccessful in communicating the Quartz’s value proposition to the plumbers.
Quartz value proposition to plumbers is following: easy to install, more profitable, faster to install and it takes 0. 5 day to install. While demonstrations have been well received by plumbers in face-to-face meetings, their fears about unreliability and installation difficulties have not dissapeared. Another issue for the company is whether to change the channel strategy, promotional strategy, and the overall positioning of the product in the context of their existing product line.
The challenge for Aqualisa is in effectively communicating to its customers and making them aware of the fact that they have developed great product: despite that it doesn’t necessarily mean that this is going to result in great sales of it. In order, for Aqualisa to succeed they need to combine the components of their marketing mix via effective communication, positioning, and distribution strategies: Acquiring brand recognition by increasing and redistributing marketing budget. Purposelly target people who are getting new showers. Forty percent of households in the U.
K. do not own any type of shower due to several challenges, most of which are addressed by the Quartz(assuming that 50% of non- owners have the financial means to purchase a premium shower). This group represents 20% of all households in the U. K. , and is a significant number of potential customers. Value proposition must be developed based on the needs of this group. The benefits of the Quartz (ease of installation, no need for excavation, works with antiquated plumbing systems, aesthetically pleasing, premium shower) align with consumers’ needs etc E