AQUALISA QUARTZ : Simply a Better Shower

AQUALISA QUARTZ :Simply a Better Shower

Rahadian AnandiantoRidwan RiswandyFiqi DipowicaksonoFelisia Noviana MuktiWulan Cahyo WeningImam Mashari

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Reg. 44

BACKGROUND

UK Shower Market

Top quality shower

Premium brand

Great service

Strong reputation

1998

Harry Rawlinson Other catching up to Aqualisa in terms of product quality

Market beginning to perceive Aqualisa products as being overpriced (table)

Actual service had slipped over

10% of Aqualisa showers still “went wrong”

Model Segment

Retail Price (€) MSP (€) Cost (€) Margin (€)

Aquastyle Premium 230 155 95 60

Aquavalve 609

Standard 715 380 155 225

Aquavalve Value Value 390 205 75 130

Aquastream Thermostatic

Standard 670 350 175 175

Aquastream Manual Value 480 250 140 110

Quartz Standard

Premium 850 450 175 275

Quartz Pumped

Premium 1080 575 230 345

Aquaforce 1.0/1.5 Bar

Standard 445 230 125 105

Aquaforce 2.0/3.0 Bar

Premium 595 310 175 135

Archaic plumbing was still common in many homes

Showers in the UK were plagued with problem

Gravity fed : cold-water tank / cistern sat in the roof, while a separate boiler and cylinder were needed to store hot water in a nearby airing cupboard

Poor to low water pressure

Frequent fluctuations in pressure

Type of Shower Information

Electric ShowerDoes not require hot water supply

Results in bulky box on the wall

Low flow rate

Mixer Shower

Requires both hot and cold water supply

Requires additional pump to address pressure problems

Installation typically requires excavation of bathroom

Power Shower

Requires both hot and cold water supply

Results in bulky box on the wall

Regarded as less reliable than a mixer-shower and pump combination

Poor pressure

Varying temperature

Shower often broke down

Uninformed about shower

Hard to turn valves, leaky seals, and worn-out showers

Brand awareness was low

Why customers disliked their shower ?

Aqualisa market share ranked it number two in mixing valves and number three in the overall UK shower market.

But, now their sales is decreasing.

Situation Analysis

MARKET SITUATION4P & DISTRIBUTION

PRODUCT• Wide range of product to cater to

the needs of all segment. • The recent introduction great leap

for Aqualisa (quality and cost). • Two models :o Quartz standart (not requiring apump

to boost water pressure)o Quartz premium (including the pump).

Aqualisa offer its product through a wide range of distribution outlet:

Trade shop

Showroom

DIY sheds

Plumbers

Contract outlets.

PLACE

PROMOTION• Good reputation and brand name

in the market• its exixting product high quality

& performance helped it attaint no. 3 position having close to 18 & market share (325.500 units of 1.8 million)

• Adopted several approaches : exebitions, face to face contact with plumbers and advertisement in the mail on Sunday.

-Pricing is higher, the additional features in the shower justify the premium charged. -Good value to end customer product & price-Maintain current price for Quartz -Use the value proposition in targeting customers. -Lowering the price = higher breakeven quantity,

PRICE

Trade Shops Showroom

•Carried products across all available brands

•Primary customer was the plumber

•Aqualisa brand was available in 40% of trade shops

•Their customers are looking for reliable product availability

•High-end product lines and brands

•Various shower and bath options were displayed

•Offered installation services by subcontracting with contractors and independent plumbers

•Aqualisa brand was sold in about 25% of them

•Offered discount

•Mass market

•Do-it-yourself products

•Aqualisa brand was unavailable through this channel

•Gainsborough brand was available in 70% of the approximately 3000 DIY

DIY Sheds

DISTRIBUTION CHANNELS

REACHING COSTUMERS

Plumbers

Standard Value DIY Premium Developers

CHANNELS

MIDDLEMAN

CUSTOMERS

Trade Shop DIY Sheds Showrooms

SEGMENTS & CHANNELS

Distribution Electric Showers Mixer Showers Power Showers

Do-It-Yourself Sheds 550000 80000 20000

Showrooms 55000 70000 20000

Trade Shops 330000 400000 110000

Other (Electrical Wholesalers) 165000 - -

TOTAL 1100000 550000 150000

UK Shower Market (Product Type and Channel)

Installation by Independent

Plumber54%

Commercial Installation

6%

Installation by Showroom

20%

Developer Installation for

New Home Build20%

UK Shower Market (Installation Method)

MARKET SITUATIONSWOT ANALYSIS

- Better water pressure and temperature control- Safer and easier for users (no sticking hand in hot water)- One touch control with light indicator- Easy to install : Junior apprentice can perform install as well- Day and half installation time saving per install (average)- Patent on Aqualisa Quartz design- Strong brand recognition- High quality product : strong engineering in design

- Unfamiliar product to plumbers- Stigma regarding past failures with electronic showers- Bad recent customer service reputation- Sales force focused on servicing existing accounts (90% of time)

S

W

- Current shower systems are bulky- Excavating required for current shower models- Bad water pressure and temperature control with current shower models- Much manual adjusting required with current shower models

- Competition catching-up on quality and technology- Aqualisa Quartz perceived as too expensive- Patent expiration- Cannibalization of existing shower product models

T

O

MARKET SITUATIONCONSUMER PROFILE

Standard :•Tended to emphasize performance and service•Relied on independent plumber to select product

Value :•Concerned with convenience and price•Avoid solution that required any excavation•Relied on independent plumber to select product

Premium : •Typically shopped in showroom•Style determined their selection

Consumer Pricing Segmentation

• Depend on plumber• Easy to use• Easy to install• Perceived high quality

product– High pressure– Stable

temperature– Endurance

Consumer

• Loyal to one product created expertise.

• Reluctant to switch brand paid more for the 2nd visit.

• Distrusted innovation (skepticism to new technology, based on some manufacturer’s failure).

• Familiarize themselves with the service from manufacturer,

Plumber

Developer

• Price sensitive• Did not need to invest

in premium product• Had relationship with

independent plumber• Prefer reliable and

stylish model

Electric Shower

Mixer Shower

Power Shower

Quality

Mar

ket

Sh

are

COMPETITIVE LANDSCAPE

PROBLEM IDENTIFICATION

How Aqualisa increase sales of its product ?

Which marketing strategy choose by Aqualisa ?

THEORY ANALYSIS

Easier to use

High quality product

My plumber recommends this

brand

It’s elegant and bring prestige to me

Its quite expensive (than the other) so it can bring pride to me

Purchase Aqualisa Quartz

LATENT & MANIFEST MOTIVES IN PURCHASE SITUATION

The linkage between behavior and motives that are known and freely admitteThe linkage between behavior and motives that are either unknown or are such that the consumer is reluctant to admit or reveal them

VALUE CREATED FOR CUSTOMER– Quartz is superior to any other

shower on the market

– Outstanding performance, elegant design, easy to use

– Cheaper and easier to install, no wall excavation due

– Great economic benefit

Value Proposition

VALUE CREATED FOR PLUMBERS

– Quartz can be installed 4 times more quickly

– Installation is so simple to let them send apprentices to perform it, which would increase plumber business

– No risk of after-sales problems

Value Proposition

Mean-End Chains Analysis :

How consumer perceive Product attribute.

Their consequences.

What these then reveal about their value.

Explore a hierarchical sequence of :

VALUE End

CONSEQUENCES(functional and psychosocial)

PRODUCT ATTRIBUTE Mean(concrete and abstract)

The Laddering TechniquesCONSUMER

Easy to use Easy to install Good looking design Endurance

Use by all family member Simplicity Elegance &

prestige Low cost

ACCOMPLISHMENT ECONOMY

The Laddering TechniquesPLUMBER

Easy to install Loyal to 1 product

Distrusted to innovation

Trust SimplicityLow cost

ACCOMPLISHMENTECONOMY BELONGING

The Laddering TechniquesDEVELOPER

ECONOMY

Easy to install Prive sensitive Prefer reliable Stylish

EleganceSaving time Low cost

Sold out

SOLUTIONS

QuartzPremium Product

Leading product in innovation and Technology

Maintain as Niche ProductHigh Quality and Performance

Targeting Customer Directly

Targeting ShowroomTargeting Developer





Increase brand awareness and knowledge by ads

Deal with Plumber (influence 73%)

Good services to plumberMake incentive program to

plumber



Showroom with service Aqualisa provide the plumber bundling with

the productExpand distribution on

showroom

Deal with High Class Developer

Create a new brand “Supermax+”

customizable




Deal with High Class Developer

Create a new brand “Supermax+”

customizable


LESSON LEARNED

It is not easy to make and market products for the first time. There are many things that must be considered by a company in create new product. Not only innovate new technology but also research their customer profiles and ways of marketing. Companies also should not be afraid to pay extra costs to support the marketing of new product. All of these actions is expected to increase the sales of new product.

By support the marketing of its own product, company will gain extra value, which is one of the most important thing from a product : consumer’s brand awareness.

High brand awareness will bring good number of profit and sales. Each company should also pay attention to each type of consumers and customers. Different consumers will need different treatment and service, thats why its important to know their profile before.

THANK YOU

AQUALISA QUARTZ : Simply a Better Shower

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