Aqualisa Hbs Case Study

Case | HBS Case Collection | January 2002 (Revised July 2006)

Aqualisa Quartz: Simply a Better Shower

by Youngme E. Moon and Kerry Herman

Abstract

Harry Rawlinson is managing director of Aqualisa, a major U.K. manufacturer of showers. He has just launched the most significant shower innovation in recent history: the Quartz shower. The shower provides significant improvements in terms of quality, cost, and ease of installation. In product testing, the Quartz shower received rave reviews from both consumers and plumbers alike. However, early sales of the Quartz have been disappointing. Rawlinson is now faced with some key decisions about whether to change his channel strategy, promotional strategy, and the overall positioning of the product in the context of his existing product line.

Keywords: Problems and Challenges; Product Launch; Consumer Behavior; Product Positioning; Technological Innovation; Decision Choices and Conditions; Sales; Strategy; Manufacturing Industry; Consumer Products Industry; United Kingdom;

 

Page 1

MEMORANDUM

TO: Harry Rawlinson, Aqualisa Managing Director FROM: Vivek Durairaj, Marianna Feldmansky (Hecht), Danielle Fontaine, Chris Henshaw,Vanessa Landry, and Scott WatsonSUBJECT: Aqualisa Quartz Marketing Mix – Product, Place, Promotion, and PriceDATE: March 11, 2009

 Statement of the Problem

Aqualisa has not established the proper mix of product, place, promotion, and pricing for itsrevolutionary Quartz shower valve. The company has relied on the same marketing mix approach for theQuartz as its other products and this has resulted in disappointing initial sales numbers. Also, Aqualisahas not devoted the necessary time and effort to soothe the fears of consumers who are wary of electronicshowers. Finally, the sales force has not spent adequate time recruiting new customers and securingdistribution through the existing network of plumbers. The existing network of plumbers has not adoptedthe product as readily as expected, which indicates that there is not a strong trust in the brand.

 Issues and Analysis

The marketing mix is the combination of product, place, promotion and pricing and it is subject to both the internal and external constraints of the marketing environment. Aqualisa has developed anappropriate marketing mix for its existing products and has operated successfully and profitably.Unfortunately, the same marketing mix cannot be applied to a product as radically different andrevolutionary as the Quartz.Before we can consider the right mix of product, place, promotion, and pricing (the four Ps) for the Quartz, we must first analyze our target customers so we know how to create the right mix for thatcustomer. We performed a market segmentation analysis (Exhibits 1-7 and 1-11) which identified six potential target customers: Standard Customers, Value Customers, Premium Customers, Plumbers,Property Developers, and Do-It-Yourselfers. The analysis revealed that the three direct customers(standard, value, and premium) can be reached through the influence of the plumbers and showrooms. Per Exhibit 1-1, plumbers are responsible for selecting the type of shower for more than 75% of shower  purchases in the U.K and Aqualisa could capitalize significantly by focusing on plumbers. The propertydevelopers could generate large guaranteed sales volumes, but this would not materialize for a few yearsdue to lengthy construction timelines. The Do-It-Yourselfers would require direct consumer advertisingand Aqualisa does not have strong brand recognition in the market among consumers at this time.

Product

– Our analysis of the Five Cs, Five Forces, and SWOT at Exhibits 1-1, 1-2, and 1-4respectively, demonstrate the innovative qualities of the Quartz and the impact it could have on the U.K.

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