This presentation tells us about the challenges faced by Aqualisa Quartz and strategies adopted by them to succeed in the UK Market

1. AQUALISA QUARTZ

2. • 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

3. -Strong Reputation in UK
-Outstanding Quality Product
-Breakthrough Technology(QUARTZ)
-Premium brand image
- Strong emphasis on R&D
-Expensive product Image
-Low brand awareness of Quartz
product
- 40% of UK homes don’t have showers
installed
- Continuous demand on shower
products
-Market perceived Aqualisa’s
products as being overpriced
-Declining in service quality
- Competitors catching up in product
quality
-Eroding in customer amount
SWOT Analysis
AQUALISA

4. Introduction to UK Shower Market
 U.K. Shower market in late 1990s was plagued with
problems
 Only 60% of U.K. homes had showers whereas 100%
of the homes had bathtubs
 Archaic plumbing was used most commonly which
had a cold water tank on the roof, a separate boiler
and cylinder to store hot water

5. Electric Showers
• Electrical
components
mounted in bulky
box.
• Introduced under
the name
‘Gainsborough’.
• Used cold water.
Mixer Shower
valves
• Manual and
Thermostatic
• Blended both hot
and cold water to
set temperature.
• Additional
booster pump
required to
enhance the flow
rate.
Integral power
showers
• Single compact
unit.
• Less reliable than
Mixer Shower
valves.
• Results in a bulky
box on the wall.

6. Trade Shops
• Stocked for
demand
• Aqualisa was
available in 40% of
trade shops
• Primary
Customer-
Plumber
relationship
Plumblers
• Huge influence on
the individual
market segment
• Major concern is
reliability,
performance and
ease-of-
installation
• Familiar product
brand to avoid
repeat plumbing
• Highly loyal to a
product
• Distrust
Innovation
• Installers have to
go several years of
training
DIY Shed
• Cheaper and
easier to retrofit
• Launch an intense
Marketing
Campaign
• Brand awareness
• Promotional low
prices temporarily
for the new
buyers
• Mass Market
• Offered Discounts
• Electric showers
were the primary
showering
• Gainsborough was
available in 40%
of them
Showroom
• High End Product
• Multiple brands.
• Primary
customers were
plumbers.
• Available in 40%
of the trade
shops.
• No inventory held
• Offered
installation
services by
subcontracting
• Aqualisa brand
was sold in 25% of
showroom
Channels of Distribution

7. Why People Disliked Showers
Poor
Pressure
Varying
Temperature
Shower
Brake Down
Low Brand
Awareness
Unattractive
Design
Poor Ease of
Installation

8. Quartz – A Breakthrough in Shower Technology
Remote Processor
A single hole drilling
Efficient & Reliable Water
Pressure
“One Touch” Control
Electronically controlled valve

9. Aqualisa
Quartz
Ease of use
Easy to
install
Good water
pressure
Stable
temperature
Great looks

10. -Safer & Easier for users
-Better water pressure and temperature
control
-One touch control with light indicator
-High quality product: strong
engineering
- Easy to install
- Day and half installation time saving
per install
-Unfamiliar product to plumbers
-Poor distribution channel
- Stigma of past failures with electronic
showers
- Sales force focused on servicing
existing account
- Current shower systems are bulky
- Bad water pressure in showers
- Fluctuating temperature in current
shower model
- Much manual adjustment required
- Competition catching up on quality
and technology
- Quartz was perceived too expensive
- Cannibalization of existing shower
product models
SWOT Analysis
QUARTZ

11. Potential Product
Augmented Product
Expected Product
Basic Product
Core Product
•Body Jet
•One Touch Control
•Automatic temperature control
•Slave remote control
•Easy Installation
•Efficient & Reliable Water Pressure
•No temperature fluctuations
•Electronic Shower
•Shower

12. High Price
Plumbers wary of innovation
No aggressive marketing due to fear of cannibalization
Concentrated more on servicing old customers rather than
developing new ones
Trade shops did not have the time to learn and explain the features
to customers
Poor distribution channel

14. Pros
• Know what to expect
• Easier to get to
• Know what it will cost
• Easier to convince because less
educated market
• If convinced, will request that
plumbers install
Cons
• Not getting directly to the problem
• Lifetime value is much lower; one-
time to two-time purchase
• High risk/High reward when the
company is already healthy

15. Pros
• Easy to install
• Value much higher than current
electric showers that dominated the
market
• Possibly charge a premium
• Differentiated from previous electric
showers
TARGETING DO-IT-YOURSELF SHEDS
Cons
• Get stuck in that market
• Small market for type of shower
• Low profitability – Low total sales

16. Pros
• Large-volume channel
• Force plumbers to get familiar with
product
• Dependable Cons
• Lead time – Long lag before sales
• Tough sell to developers – Don’t
usually buy premium products
• Don’t want to discount price for
developers
• Higher cost of failure

17. TARGETING PLUMBERS
Pros
• Most influence in the market
• More impactful word-of-mouth
• Lifetime potential for sales
Cons
• Difficult and expensive to market to
• Already biased against electric
showers
• Resistant to change

18. Solution

19. Arrange a conference for plumbers and developers
Free products to try
Provide unconditional guarantee to plumbers and
customers
Include plumbers in the workforce

20. Thank You
Presented By:
GROUP 3