Introduction and Problem Statement
Aqualisa, a premium British shower manufacturer, is experiencing teething problems with its new line of electronic mixed shower products – Quartz. Despite being hailed as “a breakthrough in shower technology” (Case p. 6), early sales were dismal. Plumbers, the main channel of Aqualisa’s products, have developed an ‘electronic phobia’ since the late 1980s when early electronic showers failed, hurting Quartz by association. Furthermore, the company is also concerned of cannibalization that could occur to Aqualisa’s existing products should Quartz become successful, especially to Aquavalve, Aqualisa’s current flagship.
Alternatives and Analysis
1)Whether to target the plumbers
73% of consumer decision is derived from plumbers’ advice . Moreover, independent plumbers installed 54% of mixer showers in the U.K. shower market . Therefore, plumbers become an extremely vital channel of distribution for promoting Quartz as a mainstream brand. Despite their resistance to electric showers, most plumbers found the Quartz installation easy and timely. This paves the way to persuading plumbers to change their attitudes towards electric showers.
2)Whether to target the other channels of distribution
Trade Shops: Quartz models accounted for the highest profit margin in dollar sales (Appendix 1), as trade shops could get at least €400 per unit of Quartz sold, vis-à-vis €335 from Aquavalve 609 (with the best margins). In view of this, it would be in the interests of the trade shops to adopt Quartz, forming a major selling point. Developers: As property developers are price sensitive, cheaper shower models such as “Aquavalve Value” should be promoted to increase sales for Aqualisa. However, in the case of luxury builders, Quartz should be sold as a premium product, which is aesthetically-pleasing and promises to deliver high performance at the same time. D.I.Y: With 84% of the D.I.Y market...