The following section focuses on the of marketing for Providian Financial Corporation where the business's customers, competitors and core proficiencies have actually evaluated in order to validate whether the decision to release Case Study Help under Providian Financial Corporation brand name would be a possible alternative or not. We have to start with taken a look at the type of clients that Providian Financial Corporation deals in 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 introducing Case Study Help under Providian Financial Corporation name.
Providian Financial Corporation clients can be segmented into two groups, last consumers and industrial consumers. Both the groups utilize Providian Financial Corporation high performance adhesives while the company is not only associated with the production of these adhesives but also markets them to these consumer groups. There are two types of items that are being sold to these prospective markets; anaerobic adhesives and immediate adhesives. We would be concentrating on the consumers of instantaneous adhesives for this analysis considering that the marketplace for the latter has a lower potential for Providian Financial Corporation compared to that of instantaneous adhesives.
The overall market for instantaneous adhesives is approximately 890,000 in the United States in 1978 which covers both client groups which have been recognized earlier.If we look at a breakdown of Providian Financial Corporation potential market or consumer groups, we can see that the company offers to OEMs (Original Devices Makers), Do-it-Yourself consumers, repair work and upgrading business (MRO) and producers dealing in products made from leather, wood, plastic and metal. This diversity in customers recommends that Providian Financial Corporation can target has numerous options in regards to segmenting the market for its new item especially as each of these groups would be requiring the same type of product with particular changes in demand, quantity or packaging. The customer is not price sensitive or brand name mindful so launching a low priced dispenser under Providian Financial Corporation name is not a recommended alternative.
Providian Financial Corporation is not simply a manufacturer of adhesives however delights in market management in the immediate adhesive industry. The business has its own experienced and qualified sales force which adds value to sales by training the company's network of 250 distributors for facilitating the sale of adhesives.
Core proficiencies are not restricted to adhesive manufacturing just as Providian Financial Corporation also concentrates on making adhesive dispensing equipment to help with using its items. This dual production technique provides Providian Financial Corporation an edge over rivals given that none of the rivals of dispensing devices makes immediate adhesives. In addition, none of these rivals offers straight to the consumer either and makes use of suppliers for connecting to customers. While we are taking a look at the strengths of Providian Financial Corporation, it is necessary to highlight the business's weaknesses also.
The business's sales personnel is competent in training suppliers, the fact remains that the sales group is not trained in selling equipment so there is a possibility of relying greatly on distributors when promoting adhesive devices. However, it should also be noted that the distributors are revealing unwillingness when it comes to selling devices that needs servicing which increases the challenges of offering devices under a specific brand.
If we look at Providian Financial Corporation line of product in adhesive devices particularly, the company has actually products aimed at the luxury of the market. The possibility of sales cannibalization exists if Providian Financial Corporation offers Case Study Help under the exact same portfolio. Given the reality that Case Study Help is priced lower than Providian Financial Corporation high-end product line, sales cannibalization would definitely be impacting Providian Financial Corporation sales revenue if the adhesive devices is sold under the business's brand name.
We can see sales cannibalization affecting Providian Financial Corporation 27A Pencil Applicator which is priced at $275. There is another possible hazard which might lower Providian Financial Corporation income if Case Study Help is released under the company's trademark name. The fact that $175000 has been invested in promoting SuperBonder recommends that it is not a great time for launching a dispenser which can highlight the truth that SuperBonder can get logged and Case Study Help is the anti-clogging solution for the instant adhesive.
Furthermore, if we look at the marketplace in general, the adhesives market does not show brand name orientation or price awareness which gives us 2 extra factors for not launching a low priced product under the company's trademark name.
The competitive environment of Providian Financial Corporation would be studied through 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 particularly as the buyer has low knowledge about the product. While business like Providian Financial Corporation have managed to train distributors regarding adhesives, the final consumer depends on suppliers. Approximately 72% of sales are made straight by makers and distributors for instant adhesives so the purchaser has a low bargaining power.
Bargaining Power of Supplier: Provided the fact that the adhesive market is controlled by three players, it could be stated that the provider delights in a higher bargaining power compared to the purchaser. The truth stays that the supplier does not have much influence over the buyer at this point particularly as the buyer does not show brand name acknowledgment or cost level of sensitivity. This indicates that the supplier has the higher power when it concerns the adhesive market while the purchaser and the maker do not have a major control over the actual sales.
Threat of new entrants: The competitive environment with its low brand loyalty and the ease of entry revealed by foreign Japanese competitors in the immediate adhesive market suggests that the marketplace allows ease of entry. If we look at Providian Financial Corporation in particular, the business has double capabilities in terms of being a manufacturer of adhesive dispensers and instant adhesives. Possible risks in equipment dispensing industry are low which reveals the possibility of creating brand name awareness in not just instant adhesives however likewise in dispensing adhesives as none of the industry players has actually managed to place itself in double capabilities.
Hazard of Substitutes: The danger of alternatives in the instant adhesive industry is low while the dispenser market in particular has substitutes like Glumetic suggestion applicators, inbuilt applicators, pencil applicators and sophisticated consoles. The truth stays that if Providian Financial Corporation introduced Case Study Help, it would be delighting in sales cannibalization for its own products. (see appendix 1 for structure).
Despite the fact that our 3C analysis has provided numerous factors for not introducing Case Study Help under Providian Financial Corporation name, we have actually a recommended marketing mix for Case Study Help given below if Providian Financial Corporation decides to go on with the launch.
Product & Target Market: The target market picked for Case Study Help is 'Automobile services' for a number of reasons. There are currently 89257 facilities in this sector and a high use of around 58900 lbs. is being utilized by 36.1 % of the marketplace. This market has an additional development capacity of 10.1% which may be a sufficient niche market section for Case Study Help. Not only would a portable dispenser offer benefit to this particular market, the truth that the Diy market can also be targeted if a safe and clean low priced adhesive is being cost usage with SuperBonder. The product would be sold without the 'glumetic idea' and 'vari-drop' so that the customer can decide whether he wishes to choose either of the two devices or not.
Price: The suggested cost of Case Study Help has been kept at $175 to the end user whether it is offered through distributors or through direct selling. This rate would not include the expense of the 'vari suggestion' or the 'glumetic suggestion'. A price listed below $250 would not need approvals from the senior management in case a mechanic at an automobile maintenance shop needs to acquire the product on his own. This would increase the possibility of affecting mechanics to purchase the item for usage in their everyday maintenance jobs.
Providian Financial Corporation would just be getting $157 per unit as displayed in appendix 2 which provides a breakdown of gross success and net profitability for Providian Financial Corporation for releasing Case Study Help.
Place: A distribution model where Providian Financial Corporation straight sends out the item to the regional supplier and keeps a 10% drop delivery allowance for the supplier would be utilized by Providian Financial Corporation. Because the sales group is already taken part in offering instantaneous adhesives and they do not have expertise in offering dispensers, involving them in the selling process would be expensive particularly as each sales call expenses approximately $120. The distributors are currently selling dispensers so offering Case Study Help through them would be a favorable alternative.
Promotion: A low advertising spending plan needs to have been appointed to Case Study Help however the truth that the dispenser is an innovation and it requires to be marketed well in order to cover the capital expenses sustained for production, the recommended advertising strategy costing $51816 is suggested for at first introducing the product in the market. The prepared ads in publications would be targeted at mechanics in vehicle upkeep shops. (Suggested text for the ad is shown in appendix 3 while the 4Ps are summed up in appendix 4).