Statement of the Problem
Decide where and how to deploy corporate marketing efforts among the various architectural painting coatings markets serviced by the company in the southwestern United States.
Situation Assessment
The US paint industry is a very mature market. The case goes as far to say that paint is can now be considered a commodity. There are 3 main sectors of the paint industry with 2, Architectural coatings and OEM coatings, holding more then 3 quarters of the market and Special purpose paints at 22% Being a mature industry they are not expecting any growth in sales figures except for the growth to stay inline with inflation. It would be useful to know where the 3 segments are at now in 2012 after the financial crisis hit and use for paint materials must have declined when housing construction (architectural) car manufacturing (OEM) and state budgets (special purpose coatings) saw a large decline. Also with customers wanting a thicker coating with less paint at a cheaper cost and strict EPA guidelines; balancing R&D cost and maintaining a strong contribution margin is becoming increasingly difficult.
Jones Blair is particularly concerned with how to grow their market share in the Architectural Paint coatings segment. This is the largest of the 3 segments at 43% of the market with minimal expected future growth. The success of this industry is tied to the housing market as most of the materials sold in this segment are used in relation with construction and residential and commercial property remodeling. It would be useful to know much of a hit this segment took with the recent housing crisis. For a while there was no new lending or construction so this segment must have been hit hard. Now that the economy is starting to grow again and people/business are starting to take on improvement projects and buy new properties It would be interested to see what kind of growth is expected over the next few years and if it is... [continues]
Decide where and how to deploy corporate marketing efforts among the various architectural painting coatings markets serviced by the company in the southwestern United States.
Situation Assessment
The US paint industry is a very mature market. The case goes as far to say that paint is can now be considered a commodity. There are 3 main sectors of the paint industry with 2, Architectural coatings and OEM coatings, holding more then 3 quarters of the market and Special purpose paints at 22% Being a mature industry they are not expecting any growth in sales figures except for the growth to stay inline with inflation. It would be useful to know where the 3 segments are at now in 2012 after the financial crisis hit and use for paint materials must have declined when housing construction (architectural) car manufacturing (OEM) and state budgets (special purpose coatings) saw a large decline. Also with customers wanting a thicker coating with less paint at a cheaper cost and strict EPA guidelines; balancing R&D cost and maintaining a strong contribution margin is becoming increasingly difficult.
Jones Blair is particularly concerned with how to grow their market share in the Architectural Paint coatings segment. This is the largest of the 3 segments at 43% of the market with minimal expected future growth. The success of this industry is tied to the housing market as most of the materials sold in this segment are used in relation with construction and residential and commercial property remodeling. It would be useful to know much of a hit this segment took with the recent housing crisis. For a while there was no new lending or construction so this segment must have been hit hard. Now that the economy is starting to grow again and people/business are starting to take on improvement projects and buy new properties It would be interested to see what kind of growth is expected over the next few years and if it is... [continues]
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