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Aqualisa Quartz Case Study

Essay by   •  May 19, 2016  •  Case Study  •  369 Words (2 Pages)  •  1,622 Views

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CASE DECISION SHEET: Aqualisa Quartz

Value Proposition:

Based on the case facts, following are value propositions for each users:

Users

Value proposition

Customers

  1. No water pressure and temperature fluctuation
  2. Low maintenance
  3. Safe for kids and elders as well
  4. Easy to use
  5. Excavation is not required

Plumber

  1. Less installation time
  2. Easy to install; even apprentice can install the product. So, master plumber can have lesser waiting time

Reasons for under-selling of Quartz:

  1. Plumbers are not recommending the product and 73% of the sales are affected by the recommendation of plumbers. They are apprehensive of innovation and they don’t have required expertise of repair and service.
  2. Product is perceived as high cost in the market.
  3. Company is not targeting the DIY and developer markets.

Investments and break-even:

Total investment : 5.8 mn euros

Average selling price:   965 euros                (2 products: 1080euro and 850euro)

Average margin per product: 310 euros

For recovering investment cost, it has to sell 18710 units, which seems an achievable target, given that 5.5lacs units of mixer showers were sold in UK in 2000. Further, there is an unexplored market of 40% of UK homes, which do not have showers.

Rationale for brands:

Brands

Gainsborough

ShowerMax

Aqualisa

Customer

DIY

Developers

All

Sales channel

DIY Sheds

Trade shop

Trade shop, showroom

As per the above table, Aqualisa is catering to different customer segments and through different sales channels. This strategy makes sense as it does not dilute the main brand of Aqualisa. This also differentiates it from its competitor Triton, which is a leader in DIY segment.

Sales Strategy:

Cost calculation (euro)

Mixer shower

Quartz

Exhibit 8

Retail price

715

1080

Excluding margin

Cost of installation

960

-

Plumber rate: 60euro*2days*8hours

Cost of installation

-

240

Plumber rate: 60euro*4hours

Total cost

1675

1320

Above table clearly shows that the cost to customer of Quartz is lower than that of other mixer shower.

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