Aqualisa Quartz

Group No. 1

Agenda
1) Situational Analysis 2) Problem Statement

3) Strategic Options
4) Recommendations

5 Cs Analysis Situation Analysis

Company High reputation (Top Quality & Great Service) Had a Premium Brand Image (in minds of Plumbers/ Developers) Ranked #3 in overall UK shower market & #2 in mixing valves Launched Quartz - 1st Significant Product Innovation in years

Channels Tradeshops
DMU- Plumbers Aqualisa in 40% of the shops Staff want reliable products over technical advice Responsible for 47% Sales

Showrooms

Premium Channel Bathroom Solutions DMU- Consumers in Consultation with Showroom Staff Aqualisa in 25% of the showrooms Responsible for 8% Sales

DIY Sheds

Discount Channel DMU- Consumers Aqualisa present through Gainsborough (70% of the sheds) Responsible for 36% Sales

Customers
Low pressure, Temperature fluctuations & Shower breakdown Low brand awareness Consumers Standard & Value followed Plumbers recommendations DIY Segment shopped in DIY Sheds; inexpensive products

Not Worried - Pressure problems ; Aesthetic Appeal - Reliable, Stylish products Price sensitive; except for Luxury Builders Developers Relationship -independent plumbers Separate Branding (ShowerMax) Lower cost & Optimized

Plumbers

High switching costs Highly influential; Primary customer of trade shops Scarcity of Plumbers Innovation skeptics
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Competition
Triton UK Market Share Highest market share 30% Others 20% Triton Consumer Brand 30% Mainly focused in Electric Showers (88% of sales)Ideal Standard 3%
Mira Masco 7% nd 2 Highest Market Mainly focused in Mixer Showers (51% of Aqualisa sales) 7% Mira 22% #1 in mixer Gainsborough shower: the main target 11% market for Aqualisa
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Context
In UK, almost everyone had a bathtub, only 60% had showers

Archaic Plumbing
2 Problems Low Pressure Fluctuations in Temperatures Innovation is rare in shower production Product Segments competed in Electric Shower Valve (61%) Mixer Shower Valve (31%) Power Shower Valve (8%)
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Aqualisa Product Portfolio

Brands Gainsborough Segment Value Type of shower Electric 95 Retail Price () Margin ()

Aquavalve
Aquastream Manual Gainsborough Aquavalve 609 Aquatsream Thermostatic Aquaforce 1.0/1.5 Bar

Value
Value Standard Standard Standard Standard

Mixer
Power Electric Mixer Power Booster Pump

390
480 165 715 670 445

130
110

225 175 105

Aquaforce 2.0/3.0 Bar

Aquatsyle Quartz Standard

Premium
Premium Premium

Booster Pump
Electric Innovation

595
230 850

305
60 275

Quartz Pumped

Premium

Innovation

1080

345

Customer Insights

End Consumer
Great looks Good pressure delivery at stable temperatures Easy to use Breakdown proof

Plumber
Easy to install

Breakdown proof No servicing requirements

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Average

Low

High

Price Pressure Control Temperature fluctuation control Safety Ease of Maintenance Current Shower Valves

Ease of Installation Ease of Use

Need of excavation Aesthetics

Strategy Canvas: Quartz Vs Current Shower Valves

Temperature meter
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Quartz

Internal analysis

Weakness
a. Low sales of Quartz b. Service Standards going down c. 10% of product went wrong (Not improving )

Strength
a. Well known in UK
b. Top Quality Showers c. Premium Brand e. Great Service f. Superior technology (Quartz)

Opportunity

SWOT

a. Higher growth prospects (40% household do not have showers)

Threats
a. Customer Perception of being Over Priced b. Competitors catching up
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Problem Statement

Lack of brand awareness among the customers (plumbers and end consumers).
This has resulted in non materialization of the sales Showroom channel accounts for only 20%.

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Value Generation
Aquavalve 609

Cost of Aqua valve 609 Cost of Aqua force pump 2 days work expense Total cost

715 445 (average) 800 (assumed) 1960

Quartz Cost of Quartz Cost of Aqua force pump Half days work expense Total cost 1080 200 (assumed) 1280
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Easy to use, Stylish, Overall saving of 680.

Existing Marketing Strategy

Targeting Consumers Directly

Pros: Can build consumer brand Cons: High advertising budget (3-4m over 2yrs) Pros: Easy to install Cons: Risk of losing premium brand tag
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Targeting DIY

Existing Marketing Strategy

Pros: Increase in customer volume Will force plumbers to get familiar with Quartz Cons: Reluctant to buy, as Aqualisa products are perceived as a high priced products Pros: Plumbers Influences 20% of decisions 28% customer takes advice 25% selects type and brand Cons: Reluctant to use electronic showers 16

Targeting Developers

Targeting Plumbers

Recommendations To follow differentiation strategy with a focus on short term and long term Short term:
Educate plumbers:
Identify and educate opinion leaders

Showrooms:
Quartz will appeal to customers who requires high end product

Developers:
Quartz will help to high end customers
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Recommendations Long term:

Plumbers:
Develop the plumber community

Invest in large scale consumer campaign

To build the brand.

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Questions

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