Case study analysis
1. Situation Analysis
a. Customer segmentation and characteristics:
* Value buyers: for them convenience and price play the most important role, they avoid excavation and tend to install the shower on their own. * Standard buyers emphasize performance and service, they rely on independent plumbers to recommend or even select a product for them. * Premium buyers mostly buy in showrooms, they need the highest performance and service, and also perceive style as very important * Developers are a special segment because they don’t buy showers for themselves; they are mostly price sensitive but don’t do installations on their own.
b. Channels of distribution:
* Trade shops are mostly intended for plumbers, they have a broad selection of different products, especially the ones that plumbers often use. * Showrooms, where bathroom equipment is sold by “consultants” and is available on display, especially for more premium brands. * Do-it-yourself sheds, retail outlets with discount prices for value buyers; they currently don’t sell Aqualisa brand, only the cheaper Gainsborough brand from the same company. * Plumbers who like to stick to the reliable solution and have bad experience regarding new trends (from electronics in the 1980s).
c. Competition – key players
Only one company (Triton) succeeded in creating brand awareness on a consumer level, otherwise consumers don’t devote much attention to brands of their showers. Triton is also number one in sold units, the second is Aqualisa’s Gainsborough, followed by Mira (22 %) and Masco (7 %). All these manufacturers are offering all three types of showers whereas some smaller companies are specialized for only one kind of shower.
d. Company and market environment
Aqualisa has a strong reputation and is generally recognized as having quality showers of different price segments and great service. The company is stable and profitable, but manager Rawlinson thought that it might be vulnerable on the long run because other companies were catching up in terms of product quality. That is why he established an R&D department and thought about differentiation from competitors. Generally, the market is mature, most of the showers (44 %) are bought for replacement of older installations. There are no innovations in the market, only small improvements of products for refreshing the product lines every four or five years. Specific of the market is that a lot of showers are sold via plumbers; because most customers don’t know any brands, they don’t bother with selecting the exact shower and they trust this task to the plumber. That fact makes plumbers important gatekeepers.
2. Quartz shower value proposition to consumers
* quick and uncomplicated installation; no need for excavating the bathroom, plumber is finished in less than one day (even apprentices could do it), therefore even costs of installation are smaller * intuitive design with one touch and indicators of desired temperature * safe to use for kids on their own
* convenient for elderly and handicapped
* also possible for self-installment
* even price is cheaper, if comparing Quartz with pump (1080 EUR) to the Aquavalve 609 Standard mixer shower with a supplemental booster pump (together 1160 EUR).
3. Quartz shower value proposition to plumbers
For plumbers, it is debatable what value Quartz represents. On one hand it is also convenient because of quick and uncomplicated installation but that means that they earn less from each installation. Aqualisa could convince them that they would be economically better off with Quartz shower because if installation is done in one day, that means that they could be more flexible when booking installations and could in the end get even more work. They can also send apprentices to this work because it is so easy. Besides that, because there are no excavations, even if...