Plax entering the market in 1998 has seen a significant attainment in market share in which the competition lead by P&G, Scope, has 32%. With Plax's attainment in two years time, P&G sees the potential of losing market shares in the product category. She is concerned that with all the competitions such as Listerine following suit of Plax's new position for the product category of "Plaque fighter" in addition to fresh breath and killing germs. She must come up with a plan of action to counter the competition. She has to answer three questions: 1- Does Scope plan and execute a new Line Extension;
2-add new claims to the present product; and
3- Take no action.
These alternatives will affect all aspects of the business in terms of financial, personnel, and manufacturing resources.
Enumerate the decision factors
There are three alternatives courses of action within the decision making factorsare: 1)Add a new claim- is considered the most prevalent of the three courses of action. This will give Scope the additional claim of fights plaque. 2)The second course of action is Line Extension- is to develop a new product specifically focusing on only fighting plaque. This is to ensure that the consumer is not confused about the additional claims on the original product. 3)No action taken-simply put P&G, Scope would do nothing directly in response to the potential threat in terms of the two other alternatives. However she will increase her promotion and advertising of the product reemphasizing her claims of fresh breath and killing germs.
Plax will continue if not do more advertising. Competitors will continue to emphasize their own claims. They will increase spending on advertising to reinforce the new claims.
Consider the relevant information
P&G, Scope has 32 % of the market share as of 1990 and of the distribution 42% is out of supermarkets, 27% out of drug stores. Listerine has 16% market share with...