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Aqualisa CASE
Marketing (RTM 468)
San Diego State University
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- In brief, why do you think the Quartz shower is not selling? (10 pts)
Answer: Plumbers need time to accept electronic technology in the plumbing industry. o Quartz shower is not selling due to most of the plumber’s conservative nature, and their adoption of this product is a long and slow process. Plumbers were wary of innovation, mainly which involve electronics and depend more on the traditional product. In the 1980s, push-button technology was introduced for temperature settings, but the mechanism did not work well, and plumbers are skeptical about using it and hesitate to purchase it for the customers. As shown below, many households depend on the plumber for the recommendation of the showers.
Developers do not want to spend more money o Developers are reluctant to spend money on products that are considered premium brands. The company is unable to sell the conventional products at a 50% discount and is unwilling to discount the price for Quartz shower for developers as it is an innovative product. Price o The price of Quartz is higher due to research and innovation. Customers are reluctant to buy the product due to the high cost. Targeting existing customers o Aqualisa is focused on selling newer products to existing customers than on making new ones. Brand awareness: o Consumers have less understanding of showers and mostly rely on the plumbers to recommend and are not aware of this brand much.
- Aqualisa spent three years and €5 million developing the Quartz. Was that appropriate? Is the Quartz a niche or mainstream product? (10 pts)
Answer:
In my opinion, it was appropriate for Aqualisa to spend €5 million and three years on the research and development of a product which was Innovative and had good demand in the market from both the plumbers and consumers. Aqualisa launches a new product every three to four years. So, it was a brilliant decision to launch Quartz, which was a different product with new features, giving Aqualisa a competitive advantage at innovation (Single button click and set the right temperature for showering was a delight for customers), technology, and installations (Easy installation increased the efficiency of plumbers). The company had acquired nine patents and had expanded the team of engineers from six to twenty during these three years’ time, which is an outstanding achievement. This team expansion helped some additional products to reach the advanced development stage and evolve dozens of ideas in the early stage of new product development. Hence, spending three years and €5 million was worth all this. I feel that the Quartz was a niche product at the time of its launch because it was a high-end product (priced at €850-1,080 compared to €480 for Aquastream Manual) targeting premium customers who loved innovation, technology, and design. Also, the product sales were significant in showrooms, which are considered a niche market.
- There are three brands in the company’s portfolio: Aqualisa, Gainsborough, and ShowerMax. What explains this multi-brand approach to the market? How have each of the 4Ps in the marketing mix been affected by this strategy? (20 pts)
Answer:
The multi-brand approach was introduced by the company to target three different kinds of market segments. Multiple brands need to be introduced by the company as one brand is not equally favorable for different market segments.
Gainsborough brand focuses only on electric showers, ShowerMax brand makes high-pressure shower with Aquavalve technology and designed keeping developers in mind. The ShowerMax brand is only for developers and not available for retail customers. Aqualisa has the rest of the types of products that the company makes. Product
Aqualisa has introduced Quartz as an innovative product after years of research. Currently, there is no competition for this product, and has a strong market presence. The higher price of the product puts it in the premium category. Quartz is superior to the electric showers being offered in the market and provided reliable water pressure. One-touch and automatic temperature control make this product innovative, along with ease of installation. This product allows to reduce the labor installation time significantly and does not require an experienced plumber. It saves plumbers time by not going back to the customer’s place again for issues due to the reliability of this product.
Price
Aquavalve 609 with Aquaforce pump shower Amount Plumber average labor cost (40+80)/2 per hour €60 x 16 € 960 Cost of material Booster pump € 445 Aquavalve 609 € 715. Total € 2,120. Assumption: 1 day = 8 hours of work
Total cost saving (Plumber installing Quartz pumped shower) = € 2120 - €1320 = € 800
- Mention five benefits that the Quartz offers to consumers and five that it offers to plumbers. (10 pts)
Answer:
Benefits which Quartz offers to the consumers: 1. High water pressure 2. Stable temperatures and Automatic temperature control 3. Reduced installation cost 4. Good design which most of the consumer likes 5. Safer for the kids, and they can use it on their own 6. Easy to use and has one-touch control mounted on the shower wall
Benefits which Quartz offers to the Plumbers: 1. Easy installation and less experienced plumber can install it easily 2. Reduced installation time from two days to almost half a day 3. Guarantee not to break down and does not require servicing / second visit 4. No excavation required in most of the cases, which is a difficult task 5. Plumbers would be able to visit more customers and earning more profits
- What should Rawlinson do to generate sales momentum? Be as specific as possible in terms of a set of strategic decisions. (20 pts)
Answer:
Rawlinson should consider the following to generate sales momentum:
Targeting Do it yourself (DIY) market is a good option to improve sales momentum. 50% of the electric showers are sold at DIY sheds. Quartz will be easy to get launched in this type of market as one of the products of Aqualisa, “Gainsborough,” was already available in 70% of the DIY sheds. The company can get partners like B&Q to get the product promoted and avoid expensive advertising costs.
Targeting developers more aggressively by making them aware of the benefits of using the latest shower technology at their properties as a marketing strategy for their prospective customers. It will force the plumbers to get used to the product as they need to install it based on developers’ requests. This approach will take some time before showers reach the customers, but consumers would appreciate the new breakthrough in the bathroom and recommend it to others. One approach is trying to make it a consumer brand. The company can provide advertisements that can target the customers directly. In this way, product information can be directly provided to the customers. Triton has proven it previously at the customer level. It is a high-risk, high reward strategy. The company should effectively communicate the benefits of Quartz shower to plumbers in terms of ease of installation, efficiency, and love the product gathers from customers who have seen it in showrooms. This would eventually make them buy the product and recommend it to consumers. Based on Exhibit-4, 73% of the purchasing decisions are based on the feedback/involvement of plumbers.
- Based on your choice in Q6, devise a positioning statement for Aqualisa Quartz. (10 pts)
Answer:
“To all our customers - Presenting the Design, Innovation, Engineering, and Convenience only with Quartz premium shower. Add beauty with benefits to your house or impress your customers with our easy to install, low maintenance, modern design, Engineering, and innovation like never before, which gives you a premium showering experience at the convenience of auto temperature control and high water pressure of your choice at a Single Click.”
Aqualisa CASE
Course: Marketing (RTM 468)
University: San Diego State University
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