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Seitel Inc Case Study Solution
Seitel Inc Case Study Help
Seitel Inc Case Study Analysis
The following section concentrates on the of marketing for Seitel Inc where the business's clients, rivals and core competencies have evaluated in order to justify whether the decision to introduce Case Study Help under Seitel Inc trademark name would be a feasible choice or not. We have to start with taken a look at the type of consumers that Seitel Inc handle while an evaluation of the competitive environment and the business's strengths and weaknesses follows. Embedded in the 3C analysis is the validation for not introducing Case Study Help under Seitel Inc name.
Both the groups utilize Seitel Inc high efficiency adhesives while the company is not just included in the production of these adhesives however also markets them to these consumer groups. We would be focusing on the customers of instant adhesives for this analysis given that the market for the latter has a lower capacity for Seitel Inc compared to that of immediate adhesives.
The overall market for instantaneous adhesives is around 890,000 in the US in 1978 which covers both consumer groups which have actually been identified earlier.If we look at a breakdown of Seitel Inc potential market or customer groups, we can see that the business offers to OEMs (Initial Equipment Manufacturers), Do-it-Yourself consumers, repair and revamping business (MRO) and producers handling items made of leather, metal, plastic and wood. This variety in customers suggests that Seitel Inc can target has different alternatives in regards to segmenting the market for its brand-new item particularly as each of these groups would be needing the exact same kind of product with particular changes in packaging, demand or amount. Nevertheless, the client is not rate sensitive or brand name conscious so launching a low priced dispenser under Seitel Inc name is not a recommended alternative.
Seitel Inc is not simply a producer of adhesives however takes pleasure in market leadership in the instant adhesive industry. The business has its own skilled and qualified sales force which adds value to sales by training the company's network of 250 distributors for assisting in the sale of adhesives. Seitel Inc believes in special circulation as indicated by the reality that it has chosen to offer through 250 distributors whereas there is t a network of 10000 distributors that can be checked out for broadening reach by means of suppliers. The company's reach is not limited to The United States and Canada only as it also delights in international sales. With 1400 outlets spread all across North America, Seitel Inc has its in-house production plants rather than utilizing out-sourcing as the favored method.
Core proficiencies are not restricted to adhesive production just as Seitel Inc likewise specializes in making adhesive dispensing equipment to facilitate using its items. This double production strategy offers Seitel Inc an edge over competitors because none of the competitors of giving devices makes immediate adhesives. In addition, none of these competitors sells directly to the consumer either and utilizes suppliers for connecting to customers. While we are taking a look at the strengths of Seitel Inc, it is very important to highlight the company's weak points also.
The company's sales staff is skilled in training suppliers, the reality stays that the sales group is not trained in selling devices so there is a possibility of relying greatly on suppliers when promoting adhesive equipment. It needs to also be noted that the suppliers are showing unwillingness when it comes to selling devices that requires servicing which increases the difficulties of selling equipment under a particular brand name.
The company has actually products intended at the high end of the market if we look at Seitel Inc item line in adhesive devices particularly. If Seitel Inc sells Case Study Help under the same portfolio, the possibility of sales cannibalization exists. Given the truth that Case Study Help is priced lower than Seitel Inc high-end line of product, sales cannibalization would definitely be impacting Seitel Inc sales earnings if the adhesive equipment is sold under the company's trademark name.
We can see sales cannibalization impacting Seitel Inc 27A Pencil Applicator which is priced at $275. If Case Study Help is launched under the company's brand name, there is another possible risk which might lower Seitel Inc profits. The reality that $175000 has actually been invested in promoting SuperBonder suggests that it is not a good time for launching a dispenser which can highlight the reality that SuperBonder can get logged and Case Study Help is the anti-clogging solution for the instant adhesive.
Additionally, if we look at the market in general, the adhesives market does disappoint brand name orientation or cost awareness which offers us two additional factors for not launching a low priced product under the business's brand.
The competitive environment of Seitel Inc would be studied through Porter's five forces analysis which would highlight the degree of rivalry in the market.
Bargaining Power of Buyer: The Bargaining power of the purchaser in this market is low specifically as the purchaser has low knowledge about the item. While companies like Seitel Inc have handled to train distributors relating to adhesives, the last consumer depends on suppliers. Around 72% of sales are made directly by makers and suppliers for immediate adhesives so the purchaser has a low bargaining power.
Bargaining Power of Supplier: Provided the reality that the adhesive market is dominated by three players, it could be stated that the supplier delights in a greater bargaining power compared to the buyer. However, the truth remains that the provider does not have much influence over the purchaser at this point specifically as the purchaser does disappoint brand acknowledgment or cost sensitivity. This indicates that the supplier has the higher power when it pertains to the adhesive market while the buyer and the manufacturer do not have a significant 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 shows that the market allows ease of entry. If we look at Seitel Inc in particular, the company has double abilities in terms of being a maker of adhesive dispensers and immediate adhesives. Potential threats in devices giving industry are low which shows the possibility of producing brand name awareness in not just instant adhesives but likewise in dispensing adhesives as none of the market players has managed to place itself in double capabilities.
Danger of Substitutes: The threat of substitutes in the instantaneous adhesive market is low while the dispenser market in particular has replacements like Glumetic pointer applicators, built-in applicators, pencil applicators and sophisticated consoles. The fact stays that if Seitel Inc introduced Case Study Help, it would be delighting in sales cannibalization for its own items. (see appendix 1 for structure).
Despite the fact that our 3C analysis has given different factors for not launching Case Study Help under Seitel Inc name, we have actually a recommended marketing mix for Case Study Help provided below if Seitel Inc decides to proceed with the launch.
Product & Target Market: The target market picked for Case Study Help is 'Automobile services' for a variety of factors. There are currently 89257 facilities in this segment and a high usage of approximately 58900 lbs. is being utilized by 36.1 % of the market. This market has an extra development capacity of 10.1% which may be a sufficient specific niche market section for Case Study Help. Not just would a portable dispenser offer benefit to this particular market, the truth that the Diy market can likewise be targeted if a drinkable low priced adhesive is being sold for use with SuperBonder. The item would be sold without the 'glumetic idea' and 'vari-drop' so that the consumer can choose whether he wants to select either of the two accessories or not.
Price: The recommended cost of Case Study Help has been kept at $175 to the end user whether it is offered through distributors or via direct selling. A rate listed below $250 would not require approvals from the senior management in case a mechanic at a motor car upkeep store needs to purchase the item on his own.
Seitel Inc would only be getting $157 per unit as shown in appendix 2 which offers a breakdown of gross success and net profitability for Seitel Inc for launching Case Study Help.
Place: A distribution model where Seitel Inc straight sends the product to the regional distributor and keeps a 10% drop delivery allowance for the supplier would be utilized by Seitel Inc. Because the sales team is currently taken part in selling immediate adhesives and they do not have knowledge in offering dispensers, involving them in the selling procedure would be costly especially as each sales call costs approximately $120. The distributors are already selling dispensers so offering Case Study Help through them would be a beneficial alternative.
Promotion: Although a low promotional budget plan needs to 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 marketing strategy costing $51816 is suggested for at first introducing the item in the market. The prepared ads in magazines would be targeted at mechanics in vehicle maintenance stores. (Suggested text for the advertisement is shown in appendix 3 while the 4Ps are summed up in appendix 4).
