Case Study: What is your position?

Barun Jha -38 Bimal Goenka -39 Faisal Khan -45 Gaurav Sinsinwar -48 Harsh Chopra -52 Jayant Desai -55 Prajot Kulkarni -59

What is our position? Are we positioned correctly?

A manufacturer of industrial cutting equipment was concerned about its poor market share and wondered whether its prices were the problem. It undertook a marketing research study which identified the product and service attributes most desired by customers and evaluated how its product X & its key competitors were rated in table below on a 1to 6 scale where 1 is lowest and 6 is highest.

Table assessing price & value competitiveness

Competitors B C 5 6 3 3 5 4 3 2 5 5

Importance Quality Wt: Dimension 35% Precision 25% Reliability 15% Durability 20% Service 5% Delivery

A 6 6 5 5 2

X 6 4 5 1 5

Table assessing the overall weightage, actual prices & market share
Weighted Score Actual Prices Market Share A 5.5 29,000 27% B 4.6 21,000 45% C 3.7 15,000 20% X 4.3 22,000 8%

The Solutions
Why the positioning of X is inadequate/ wrong? Explain in marketing jargon, why is it weak? What are the positions of A, B and C? Why are they strong? Who is the strongest of all and who is the weakest of all?

Incorrect positioning of X
Problem lies in incorrect positioning of X. Even though X is offering its services to the mass market, the quality that X is offering is way below the consumers requirements.

Comparison with A, B & C

Comparing X with A (which is the premium market): Quality of X in comparison with A is far below the sustainable level in market share. Comparing X with B (which is catering to mass market): Considering the service front, here X is lagging behind. Clearly, Xs performance is not up to the mark and there is a lot left to be desired.

Comparing X with C (which is the economy segment): The pricing of X is much higher than the expectations from a middle class consumer.

Therefore after comparing all three brands with X we conclude that B is the strongest of all and X has a very weak and marginal position in the market.

How do you solve? What strategy do you recommend? Why? After comparing all the brands we know that X has to compete with B. X should change its positioning in the market. Improve the quality of X to match with the needs of the mass market & reduce the price to what the consumer is willing to pay.

Deliver value added services to retain customers. Matching the quality with the price segment. Improve the service given by the company.

What alternatives can be considered by X?

Look at its existing cost structures and modify them (By outsourcing, subcontracting etc) to achieve an optimum price without compromising on its profit. Look at the technical aspects of the product and why the product is not as reliable as other players and improve its reliability. Communicate to its customers clearly its position and improved quality of the product.

Pros of these alternatives

Help in proper positioning in the mass

market segment
Increase in market share Increase in profitability

Cons of these alternatives

The size of the segment is too small in

order to make it commercially viable.

The

growth rate is very small and insignificant in the market. are many players successfully marketing in the segment.

There

Thank you!