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American International Group Inc Case Study Solution
American International Group Inc Case Study Help
American International Group Inc Case Study Analysis
The following section concentrates on the of marketing for American International Group Inc where the business's clients, competitors and core proficiencies have examined in order to justify whether the decision to launch Case Study Help under American International Group Inc brand would be a possible choice or not. We have firstly looked at the kind of customers that American International Group Inc deals in while an evaluation of the competitive environment and the company's weak points and strengths follows. Embedded in the 3C analysis is the reason for not introducing Case Study Help under American International Group Inc name.
American International Group Inc customers can be segmented into two groups, commercial consumers and final customers. Both the groups utilize American International Group Inc high performance adhesives while the business is not only involved in the production of these adhesives but also markets them to these client groups. There are 2 kinds of items that are being offered to these possible markets; anaerobic adhesives and instantaneous adhesives. We would be focusing on the consumers of instant adhesives for this analysis considering that the market for the latter has a lower potential for American International Group Inc compared to that of instant adhesives.
The overall market for instant adhesives is around 890,000 in the US in 1978 which covers both client groups which have been recognized earlier.If we take a look at a breakdown of American International Group Inc potential market or consumer groups, we can see that the business offers to OEMs (Initial Devices Manufacturers), Do-it-Yourself consumers, repair work and revamping companies (MRO) and producers dealing in products made of leather, metal, plastic and wood. This diversity in clients recommends that American International Group Inc can target has numerous choices in terms of segmenting the market for its brand-new item especially as each of these groups would be requiring the exact same kind of product with particular changes in packaging, demand or amount. The customer is not price delicate or brand mindful so releasing a low priced dispenser under American International Group Inc name is not a suggested alternative.
American International Group Inc is not just a maker of adhesives however enjoys market leadership in the instant adhesive industry. The company has its own experienced and competent sales force which includes worth to sales by training the business's network of 250 suppliers for helping with the sale of adhesives. American International Group Inc believes in special distribution as indicated by the fact that it has actually selected to sell through 250 suppliers whereas there is t a network of 10000 suppliers that can be checked out for broadening reach through distributors. The company's reach is not limited to North America only as it likewise delights in worldwide sales. With 1400 outlets spread all across The United States and Canada, American International Group Inc has its in-house production plants rather than using out-sourcing as the preferred method.
Core proficiencies are not restricted to adhesive manufacturing only as American International Group Inc likewise specializes in making adhesive giving devices to help with making use of its items. This dual production method gives American International Group Inc an edge over rivals because none of the competitors of dispensing equipment makes instantaneous adhesives. Additionally, none of these competitors offers directly to the consumer either and makes use of suppliers for reaching out to customers. While we are looking at the strengths of American International Group Inc, it is necessary to highlight the company's weaknesses as well.
The business's sales staff is competent in training distributors, the reality remains that the sales team is not trained in selling devices so there is a possibility of relying greatly on distributors when promoting adhesive devices. It must also be noted that the distributors are showing reluctance when it comes to offering devices that requires maintenance which increases the obstacles of offering devices under a specific brand name.
If we take a look at American International Group Inc product line in adhesive devices especially, the company has items targeted at the high end of the market. If American International Group Inc sells Case Study Help under the exact same portfolio, the possibility of sales cannibalization exists. Offered the reality that Case Study Help is priced lower than American International Group Inc high-end product line, sales cannibalization would certainly be impacting American International Group Inc sales earnings if the adhesive devices is sold under the company's brand.
We can see sales cannibalization affecting American International Group Inc 27A Pencil Applicator which is priced at $275. If Case Study Help is launched under the business's brand name, there is another possible threat which could reduce American International Group Inc income. The reality that $175000 has been spent in promoting SuperBonder suggests that it is not a great time for launching a dispenser which can highlight the fact that SuperBonder can get logged and Case Study Help is the anti-clogging solution for the instantaneous adhesive.
Additionally, if we look at the market in general, the adhesives market does not show brand orientation or price awareness which offers us two additional reasons for not launching a low priced product under the company's trademark name.
The competitive environment of American International Group Inc would be studied by means of Porter's five forces analysis which would highlight the degree of competition in the market.
Bargaining Power of Buyer: The Bargaining power of the purchaser in this market is low especially as the purchaser has low knowledge about the item. While business like American International Group Inc have actually handled to train distributors concerning adhesives, the final customer is dependent on suppliers. Roughly 72% of sales are made directly by producers and distributors for immediate adhesives so the purchaser has a low bargaining power.
Bargaining Power of Supplier: Offered the truth that the adhesive market is dominated by three gamers, it could be said that the provider delights in a higher bargaining power compared to the purchaser. However, the reality stays that the provider does not have much influence over the purchaser at this point particularly as the purchaser does not show brand name recognition or cost sensitivity. This suggests that the distributor has the higher power when it concerns the adhesive market while the maker and the purchaser do not have a major control over the actual sales.
Threat of new entrants: The competitive environment with its low brand name commitment and the ease of entry revealed by foreign Japanese competitors in the instant adhesive market shows that the market allows ease of entry. Nevertheless, if we look at American International Group Inc in particular, the business has double abilities in regards to being a producer of instantaneous adhesives and adhesive dispensers. Prospective dangers in equipment dispensing market are low which shows the possibility of producing brand awareness in not only instantaneous adhesives however also in dispensing adhesives as none of the market gamers has handled to position itself in dual capabilities.
Threat of Substitutes: The threat of replacements in the immediate adhesive industry is low while the dispenser market in particular has substitutes like Glumetic tip applicators, in-built applicators, pencil applicators and sophisticated consoles. The reality remains that if American International Group Inc presented Case Study Help, it would be delighting in sales cannibalization for its own products. (see appendix 1 for framework).
Despite the fact that our 3C analysis has actually offered different factors for not launching Case Study Help under American International Group Inc name, we have a recommended marketing mix for Case Study Help offered below if American International Group Inc decides to go on with the launch.
Product & Target Market: The target market selected for Case Study Help is 'Motor lorry services' for a number of reasons. This market has an extra development capacity of 10.1% which might be a good adequate niche market section for Case Study Help. Not just would a portable dispenser deal convenience to this particular market, the reality that the Diy market can likewise be targeted if a drinkable low priced adhesive is being sold for usage with SuperBonder.
Price: The recommended rate of Case Study Help has been kept at $175 to the end user whether it is offered through distributors or through direct selling. A cost below $250 would not require approvals from the senior management in case a mechanic at a motor lorry upkeep shop requires to purchase the item on his own.
American International Group Inc would just be getting $157 per unit as displayed in appendix 2 which provides a breakdown of gross success and net success for American International Group Inc for releasing Case Study Help.
Place: A distribution design where American International Group Inc directly sends out the item to the regional supplier and keeps a 10% drop shipment allowance for the supplier would be utilized by American International Group Inc. Given that the sales group is already engaged in offering instant adhesives and they do not have expertise in selling dispensers, including them in the selling procedure would be expensive particularly as each sales call costs around $120. The distributors are already selling dispensers so selling Case Study Help through them would be a favorable choice.
Promotion: Although a low marketing spending plan must have been appointed to Case Study Help but the reality that the dispenser is an innovation and it requires to be marketed well in order to cover the capital costs incurred for production, the recommended advertising strategy costing $51816 is recommended for at first presenting the product in the market. The planned advertisements in publications would be targeted at mechanics in car upkeep shops. (Suggested text for the advertisement is shown in appendix 3 while the 4Ps are summed up in appendix 4).
