The following area concentrates on the of marketing for Areva where the business's customers, competitors and core proficiencies have actually examined in order to justify whether the decision to release Case Study Help under Areva trademark name would be a possible option or not. We have to start with looked at the kind of consumers that Areva handle while an examination of the competitive environment and the company's strengths and weaknesses follows. Embedded in the 3C analysis is the validation for not launching Case Study Help under Areva name.
Both the groups use Areva high performance adhesives while the business is not just included in the production of these adhesives however also markets them to these customer groups. We would be focusing on the customers of instantaneous adhesives for this analysis considering that the market for the latter has a lower capacity for Areva compared to that of instant adhesives.
The overall market for immediate adhesives is roughly 890,000 in the US in 1978 which covers both consumer groups which have been determined earlier.If we look at a breakdown of Areva possible market or client groups, we can see that the business offers to OEMs (Initial Devices Manufacturers), Do-it-Yourself customers, repair and overhauling companies (MRO) and makers dealing in products made of leather, metal, wood and plastic. This diversity in customers recommends that Areva can target has numerous options in regards to segmenting the market for its brand-new product specifically as each of these groups would be requiring the same type of product with particular changes in quantity, demand or packaging. Nevertheless, the customer is not price sensitive or brand name conscious so releasing a low priced dispenser under Areva name is not an advised choice.
Areva is not just a manufacturer of adhesives but delights in market management in the immediate adhesive industry. The company has its own competent and certified sales force which adds worth to sales by training the business's network of 250 distributors for assisting in the sale of adhesives. Areva believes in special circulation as indicated by the reality that it has actually selected to offer through 250 distributors whereas there is t a network of 10000 distributors that can be checked out for broadening reach through suppliers. The business's reach is not limited to North America only as it also delights in international sales. With 1400 outlets spread all throughout The United States and Canada, Areva has its internal production plants instead of using out-sourcing as the favored strategy.
Core competences are not limited to adhesive production only as Areva likewise concentrates on making adhesive dispensing devices to assist in the use of its products. This double production technique gives Areva an edge over rivals because none of the rivals of giving equipment makes instant adhesives. In addition, none of these rivals sells straight to the consumer either and makes use of suppliers for reaching out to customers. While we are looking at the strengths of Areva, it is very important to highlight the business's weak points as well.
The business's sales staff is competent in training distributors, the fact remains that the sales group is not trained in offering devices so there is a possibility of relying heavily on suppliers when promoting adhesive devices. It should also be kept in mind that the suppliers are revealing reluctance when it comes to offering equipment that requires maintenance which increases the obstacles of offering devices under a particular brand name.
If we look at Areva line of product in adhesive equipment especially, the business has actually products aimed at the luxury of the market. The possibility of sales cannibalization exists if Areva sells Case Study Help under the very same portfolio. Offered the reality that Case Study Help is priced lower than Areva high-end product line, sales cannibalization would certainly be affecting Areva sales revenue if the adhesive devices is sold under the company's trademark name.
We can see sales cannibalization affecting Areva 27A Pencil Applicator which is priced at $275. There is another possible hazard which could decrease Areva revenue if Case Study Help is released under the business's brand name. The reality that $175000 has actually been invested in promoting SuperBonder suggests that it is not a good time for releasing a dispenser which can highlight the fact that SuperBonder can get logged and Case Study Help is the anti-clogging solution for the immediate adhesive.
In addition, if we take a look at the market in general, the adhesives market does not show brand name orientation or rate awareness which gives us two extra reasons for not launching a low priced product under the company's brand.
The competitive environment of Areva would be studied via Porter's 5 forces analysis which would highlight the degree of rivalry in the market.
Bargaining Power of Buyer: The Bargaining power of the purchaser in this industry is low especially as the buyer has low knowledge about the item. While companies like Areva have managed to train suppliers relating to adhesives, the last consumer depends on suppliers. Around 72% of sales are made straight by makers and distributors for instant adhesives so the buyer has a low bargaining power.
Bargaining Power of Supplier: Offered the reality that the adhesive market is controlled by 3 players, it could be stated that the provider takes pleasure in a greater bargaining power compared to the purchaser. However, the reality remains that the supplier does not have much impact over the purchaser at this point especially as the purchaser does not show brand name acknowledgment or cost level of sensitivity. This shows that the distributor has the greater power when it pertains to the adhesive market while the producer and the purchaser do not have a major control over the real sales.
Threat of new entrants: The competitive environment with its low brand commitment and the ease of entry shown by foreign Japanese rivals in the instant adhesive market indicates that the market permits ease of entry. If we look at Areva in particular, the company has dual abilities in terms of being a producer of adhesive dispensers and immediate adhesives. Prospective hazards in devices dispensing industry are low which shows the possibility of creating brand awareness in not only instantaneous adhesives but also in dispensing adhesives as none of the industry gamers has actually handled to position itself in double abilities.
Threat of Substitutes: The risk of replacements in the instantaneous adhesive market is low while the dispenser market in particular has substitutes like Glumetic idea applicators, built-in applicators, pencil applicators and advanced consoles. The fact stays that if Areva introduced Case Study Help, it would be delighting in sales cannibalization for its own items. (see appendix 1 for framework).
Despite the fact that our 3C analysis has given numerous reasons for not introducing Case Study Help under Areva name, we have actually a suggested marketing mix for Case Study Help given listed below if Areva decides to go ahead with the launch.
Product & Target Market: The target market selected for Case Study Help is 'Motor automobile services' for a number of factors. This market has an extra development capacity of 10.1% which might be a good adequate niche market sector for Case Study Help. Not just would a portable dispenser deal convenience to this specific market, the reality that the Do-it-Yourself market can also be targeted if a safe and clean low priced adhesive is being offered 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 listed below $250 would not require approvals from the senior management in case a mechanic at a motor car maintenance shop needs to purchase the item on his own.
Areva would just be getting $157 per unit as displayed in appendix 2 which provides a breakdown of gross success and net success for Areva for launching Case Study Help.
Place: A distribution design where Areva directly sends out the item to the regional supplier and keeps a 10% drop shipment allowance for the distributor would be utilized by Areva. Considering that the sales group is already taken part in selling immediate adhesives and they do not have knowledge in selling dispensers, involving them in the selling procedure would be costly especially as each sales call costs approximately $120. The suppliers are currently offering dispensers so offering Case Study Help through them would be a beneficial choice.
Promotion: Although a low advertising budget plan must have been assigned to Case Study Help however the fact 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 marketing strategy costing $51816 is suggested for initially introducing the product in the market. The prepared advertisements in publications would be targeted at mechanics in car upkeep stores. (Recommended text for the advertisement is displayed in appendix 3 while the 4Ps are summed up in appendix 4).