Business
MGT-520
Team: McDream
Eunkyu Yang, Seung Jae Kwak, Kijin Ryan Lee, Ah Reum Kwon, Go Eun Lyu
The Brita Products Company
1. To what do you attribute Brita’s success?
The success of Brita in the United States was due to the innovative product model as well as the great marketing support from a well-established manufacturer and marketer, The Clorox Company. Although the company struggled the first few years with low sales volume, however, they believed that a Brita consumer would have a remarkable lifetime value, resulting in the retention rate of 80%. Not only their retention rate was high, Brita’s market share had been steady in the range of 65% and 75%, which made them a dominant market player in the system and filter market. The reason for being so dominant in the market was because Brita’s products were exactly what the consumers were looking for. Attributes of the core product, the pitcher, itself had the following benefits: It improved the taste of water better by reducing chlorine and odors and it was extracting heavy metals from the water so there were no depositing salts or sediment when the water was boiled.
In terms of market environment, there was actually no major concern to the consumers about filtering the tap water until it became an issue. During the decade of 90’s, the sensitivity people showed about some health-related accidents helped Brita to easily increase their brand awareness to the public and create a significant market. As the market grew and the product became popular, a lot of people perceived Brita pitcher as a present for their friends and close ones.
[Exhibit 6] Retail Market Shares (United States, all retail outlets)
System | 1995 | 1996 | 1997 | 1998 | Pitchers (thousands of units) | 2,636 | 4,381 | 5,689 | 6,307 | Brita | 77% | 77% | 80% | 83% | PUR | -% | -% | 4% | 8% | Rubbermaid | -% | -% | 7% | 4% | All others | 23% | 23% | 11% | 5% | Faucet Mounts (thousands of units) | 659 | 898 | 1,249
Team: McDream
Eunkyu Yang, Seung Jae Kwak, Kijin Ryan Lee, Ah Reum Kwon, Go Eun Lyu
The Brita Products Company
1. To what do you attribute Brita’s success?
The success of Brita in the United States was due to the innovative product model as well as the great marketing support from a well-established manufacturer and marketer, The Clorox Company. Although the company struggled the first few years with low sales volume, however, they believed that a Brita consumer would have a remarkable lifetime value, resulting in the retention rate of 80%. Not only their retention rate was high, Brita’s market share had been steady in the range of 65% and 75%, which made them a dominant market player in the system and filter market. The reason for being so dominant in the market was because Brita’s products were exactly what the consumers were looking for. Attributes of the core product, the pitcher, itself had the following benefits: It improved the taste of water better by reducing chlorine and odors and it was extracting heavy metals from the water so there were no depositing salts or sediment when the water was boiled.
In terms of market environment, there was actually no major concern to the consumers about filtering the tap water until it became an issue. During the decade of 90’s, the sensitivity people showed about some health-related accidents helped Brita to easily increase their brand awareness to the public and create a significant market. As the market grew and the product became popular, a lot of people perceived Brita pitcher as a present for their friends and close ones.
[Exhibit 6] Retail Market Shares (United States, all retail outlets)
System | 1995 | 1996 | 1997 | 1998 | Pitchers (thousands of units) | 2,636 | 4,381 | 5,689 | 6,307 | Brita | 77% | 77% | 80% | 83% | PUR | -% | -% | 4% | 8% | Rubbermaid | -% | -% | 7% | 4% | All others | 23% | 23% | 11% | 5% | Faucet Mounts (thousands of units) | 659 | 898 | 1,249