Published on March 2, 2014
Aqualisa Quartz Simply A Better Shower Akanksha Mohanty Evelyn Joseph Prashant Patro Nandana S Siddharth Modak Taranpreet Kaur 13020841064 13020841075 13020841094 13020841085 13020841103 13020841113
Agenda • • • • • • • • • • • • Introduction to UK shower market and existing products Introduction to Aqualisa The Quartz Concept 4 P’S of Aqualisa Quartz Product Level SWOT Analysis Customers Competitive Landscape The Problem Possible Solutions Value Creation Recommendation
Introduction to UK Shower market
• U.K. Shower market in late 1990s was plagued with problems. • Only 60% of U.K. homes had showers. • Archaic plumbing was used most commonly which had a cold water tank on the roof, a separate boiler and cylinder to store hot water. • Problems: • Low pressure • Fluctuations in temperature
Types of Showers Electric Showers • Electrical components mounted in bulky box. • Introduced under the name ‘Gainsborough’. • Used cold water. Mixer Shower valves Integral power showers • Manual and Thermostatic • Blended both hot and cold water to set temperature. • Additional booster pump required to enhance the flow rate. • Single compact unit. • Less reliable than Mixer Shower valves. • Results in a bulky box on the wall.
Why People Disliked Showers Poor pressure Varying Temperature Showers often broke down Brand Awareness very low
Introduction to Aqualisa
Introduction • Founded in 1977 • Head office in Westerham, Kent • Aqualisa was ranked at #2 in mixing valves and #3 in the overall UK shower market • Had 25% net returns on sales • 5% to 10% growth rate
Channels of Distribution TRADE SHOPS SHOWROOMS • Carried products of all brands. • High-end products. • Primary CustomerPlumbers • Showroom consultants helped their customers choose a product. • Plumbers worked for developers, showrooms, contractors or directly to customers. • No inventory was held in the location. • Aqualisa was available in 40% of the trade shops. • Aqualisa brand was sold in 25% of showrooms in UK. • They also offered installation services. DIY SHEDS • Offered discounts, mass market, do it yourself products • Electric showers led sales in this channel as they were cheaper and easier to retrofit. • Aqualisa was unavailable but its Gainsborough brand was available in 70% of the DIY outlets in UK.
UK Shower Market By Installation Method(mixer Showers Only) 20% By Independent Plumber 6% 54% 20% Developer installation By Showroom Commercial installation
UK Shower Market, by Product Type and Channel (Total units sold, 2000)
The Quartz Concept • In late 90’s – Aqualisa started new project – innovative shower. • Started by asking plumber – used their comments - develop new design. • 3 years of R n D – solved all installation problem. • Asked consumers – used their comments – develop a digital shower – easy to understand. • Gave a sophisticated look – convenience for older people, children, plumbers.
The Quartz Technology Blended Water Valve and Control Valve Control Cold Water Hot Water
Easy to Fit Sophisticated Look
Quartz Versions: → The Quartz Standard Shower → The Quartz Pumped Shower Benefits: → The plumber had to identify a physical space to accommodate the remote processor → The processor contained the thermostatic mixing valve and pump → The device could be mounted horizontally, vertically or on its side, depending on space constraints →Installation time of half a day → Straightforward installation process → Provided efficient and reliable water pressure → Temperature – “one touch” Control → Only single hole in the roof needed
4Ps of Aqualisa Quartz PRODUCT PLACE Quartz was very superior to the electric showers being offered. Provided efficient & reliable water pressure. One touch control Automatic temperature control. Easier installation. Two models : Quartz standard (not requiring a pump to boost water pressure) Quartz premium (including the pump). Aqualisa offered its products through a wide range of distribution channels: 1. 2. 3. Trade shops Showrooms DIY Sheds
4Ps of Aqualisa Quartz (contd.) PRICE PROMOTION Priced higher. The additional features in the shower justify the premium charged. Sales force spends 90% of the time servicing existing customers. They contacted the plumbers face to face to introduce the product. Print advertisement campaign.
Product Level Potential Product Augmented Product Expected Product • Body Jet • One Touch Control • Automatic temperature control • Slave remote control • Easy Installation • Efficient & Reliable Water Pressure • No temperature fluctuations Basic Product • Electronic Shower Core Product • Shower
S •Safer & Easier for users •Better water pressure and temperature control •One touch control with light indicator •Easy to install •Day and half installation time saving per install •Nine patents on Aqualisa Quartz design •Strong brand recognition •High quality product: strong engineering W •Unfamiliar product to plumbers •Stigma of past failures with electronic showers •Bad recent customer service reputation •Sales force focused on servicing existing account •Poor distribution channel
O •40% of UK homes did not have shower •Current shower systems are bulky •Excavating required for current models •Bad water pressure in showers •Fluctuating temperature in current shower model •Much manual adjustment required •Targeting plumbers, who influence 73% of end consumers T •Competition catching-up on quality and technology •Quartz was perceived as too expensive •Plumbers distrust innovation and are brand loyal •Dependency of consumer to the plumbers •Cannibalization of existing shower product models
Customers Premium • Shopped in the showrooms • Expected high performance and service • Preferred stylish products Standard • Emphasized performance and service • Relied on plumbers to select a product for them Value • Concerned with convenience an price • Avoid solutions involving excavations • Relied on plumbers to select a product
Developers • Preferred reliable nice looking products that could work in multiple settings • Price sensitive • Had relationships with individual plumbers Do-It-Yourself • Interested in models that were easy to install • The products were usually cheap, bulky and unattractive • Electric showers were the preferred choice in this segment because they could be adapted to all water systems and could be installed in a day
Different Needs Of Customers • • • • • • Consistent and high pressure Stable temperature Endurance Ease of use Ease of installation Visibly pleasing
Market Share Electric Shower Power Shower Quality Mixer Shower
• The Aqualisa Quartz was a new and innovative product • The Quartz should have been of interest to plumbers as the shower system took less time and less costly to install • Aqualisa had a strong reputation regarding its service and the quality of its showers • Most customers relied on their plumbers to choose their showers • 40% of UK homes did not have showers
• Aqualisa was poorly distributed, with only 40% of trade shops, 25% of showrooms and nonexistent in the DIY category • The company was focussed on keeping existing accounts instead of seeking new customers • Aqualisa was still a relatively small company when compared to bigger players like Triton • 10% of Aqualisa products malfunctioned
The Problem • Aqualisa Quartz sales did not meet expectations • The competition was expected to match the Quartz’ advanced technology within a couple of years. • Triton was the only company with an established brand awareness. • Plumbers distrusted innovation and were brand-loyal • Aqualisa Quartz was viewed and perceived as overpriced • A shift in marketing strategy was required to generate sales momentum
Possible Solutions Target Customers Directly Target Trade Shops & Plumbers Target DoItYourselfers Target Developers
Target Customers Directly Pros • Target end-users directly to create a powerful customer brand • This would enable them to compete better against Triton Cons • Not a cost effective strategy for Aqualisa • Must be consistent to be effective Target Do-It-Yourselfers Pros • Gainsborough already successful in this category and Aqualisa could take advantage of its channels of distributions • DIY may be willing to pay a premium because of its ease of installation Cons • Expensive consumer advertising • Potential cannibalization
Target Trade Shops & Plumbers Pros • Plumbers had direct contact with final consumers, had strong influence over purchase decision and made 54% of the market • Trade shops represented 46.7% of the UK shower market Cons • Plumbers were wary of innovative and unfamiliar products, it would take time to sway them • Trade shops stocked many other more popular brands Target Developers Pros • Developers simplified sales for Aqualisa due to large volumes and low cost • Plumbers would eventually be familiarized with the product Cons • Going through developers would mean it would take longer for Aqualisa to reach customers, as developers were only 15% of the market • Premium price would be make Aqualisa a tough sell
Value Creation • • • • • Superiority of the brand- Large market share Outstanding performance, elegant design Easier to install- simplicity No risk of after sales problems Easy and safe to use – Simple(one touch control) and can be used by all family members • Great economic benefits
Value Creation for Customers Easy to use: by all family members and simplicity Easy to install: simplicity and low costs involved Looks- sense of prestige and elegance ECONOMIC BENEFITS Endurance: low maintenace costs
Value Creation for Plumbers Easy to install: Low Cost & Simplicity ECONOMY Loyal : Trust BELONGING No Innovation: Simplicity ACCOMPLISHMENT
Value Creation for Developers Installation: time saving & low cost Price Sensitive: Low cost Reliability: Low cost ECONOMY Design: Sold out
Recommendations • Expand distribution on showrooms • Educate plumbers: – Identify and educate plumbers regarding the new innovation and usability of the products. – Help in forming a plumbing community which will increase the loyalty factor in the product • Developers: – Reach out to high end customers, make contracts and provide incentives • Invest in consumer campaigns: – Awareness about the simplicity of the products and thereby improve the brand.
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