Jones Blair Company Case Study

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JBC’s market area and segmentation

The market of Jones Blair can be divided to two groups: Dallas-Fort Worth area and Non Dallas-Fort Worth

JBC’s potential segment(s) and strategy

In order to reach these business goals at a time when growth is nonexistent, Jones-Blair must take immediate action and increase their sales team and refocus their sales energies.

Jones Blair is a regional paint manufacturer that has to compete in a mature market (sales growth are expected to be the general rate of inflation) and also very concentrated, since the seven major producers account for upwards of 60 percent of sales.

Therefore, in this market context, Jones Blair will need to increase its sales in volume, but keep its profit margin. The strategies to be considered in this case can be based on: consumer segmentation, targeting and managing marketing mix.

Key Issues

Recent research indicated that do-it-yourself painters do not care much about the brand and, consequently, about the quality of the paint (brand reputation was the 4th key criteria mentioned by the buyers to choose a covering) and it has become a commodity for this kind of consumers.

Also, the company has been facing strong environmental pressure due to new regulations about the emissions of volatile organic compounds (VOCs). It is necessary for the company to invest in R&D and it is also likely that the company will not see its costs of production decrease due to the activities of R&D. -SWOT Analysis:

Strengths
• High quality products
• High quality service with
• Knowledgeable sales representatives that know customers personally • Mature market 1-2% sales growth long-term
• Shelf goods 43% of total industry dollar sales
• Specialty paint stores & lumberyards most frequently patronized • Distributes through 200 independent paint stores
• Maintaining margins while increasing R&D, material, & labor costs • Market to major business/financial center (DFW)
• Total sales/year increasing dollars sales rate 4% each year Weakness
• Slow sales growth
• Reduce emissions of volatile compounds
• Compliance w/ EPA = low profit margins
• Presence in DFW do it yourself market, in-home centers
• Non-DFW market
• New accounts, only added 5 in last 5 years
• High costs for product
• DFW Sales decreased
• Paint gallon-age hasn't changed in years
• Highest priced paint in service area, especially in DFW
• Awareness of the company
Opportunities
Need to increase customer awareness by 30%
• Increase demand for paint sundries due to trend towards do it yourself painting • Interior more popular than exterior
• Expand beyond paint
• Primarily in DFW area, so advertising outside of DFW
• Increase advertising over all mediums, catalogs etc
• Develop new retail accounts leads and penetrations
• Professional painters could solicit business to them
• Discount coupon offers on every purchase after first to build loyalty • Increase contractor sales
• Number of paint companies are declining at a rate of 2 to 3% a year • US Paint industry is maturing, over $13 billion in 1997Threats • Research & design= low profit margins
• Customers choose store first, then brand
• Companies like Wal-Mart becoming bigger
• Competition from cheaper paint brands
• More options besides painting
• Competition in DFW market
• Competition in non-DFW market
• Sherwin Williams, Benjamin Moore, Sears, Kmart, Home Depot etc., strong brand...

There are a few options to consider when determining how Jones-Blair Company will achieve their business goals of exponentially increasing company sales. One would be to make an additional expenditure in advertising in the DFW area to increase the awareness of the company brand to do-it-yourself painters. Another would be to cut the price in both the DFW and non-DFW areas of all paint products by 20% in order to achieve parity with national paint brands. As well, the company could consider increasing their present sales reps,...
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