Situation Analysis
Quartz a product by Aqualisa in spite being an innovative product that is user-friendly and as per latest trends of the industry is still facing the challenge of increasing the sales for the product after the first four months of the launch. As stated in the case, the product is seen by the plumbers as 'push-fit-connect-you're done' shower and offers the customers 'what the plumbers really want who are the real influencers in the industry. Although being unique and liked by the plumbers, the product is still facing issues in terms of increasing the sales and brining in the revenue which the company expected prior to the launch of Aqualisa Quartz.
aqualisa quartz case solution
The reason for this slow acceptance in the market for Quartz is basically because the brand awareness was quite low and the industry was largely influenced by plumbers and not by the consumer. Quartz was unable to achieve the first mover’s advantage in industry because no such product was available in the industry which the consumer can really think as innovative and made of better technology and features. The newly launched product by Aqualisa had been slow and people have not adapted to the new technology as the company had anticipated while manufacturing the new innovative shower product.
Problem Statement
The problem that Harry Rawlinson is facing is that when he launched Aqualisa Quartz, he expected that the sales for the product will be high because of the product being highly innovative and user-friendly. Unfortunately, Quartz did not turn out as a successful shower product and the sales for the product did not provide excessive revenues. Being technically advance and also equipped with advance features, Quartz did not penetrate in the market with instant success which made the management concerned as new technology might come up within two years and Quartz might become an obsolete product. Therefore, the company wants to restructure the product while targeting the correct market that is the plumbers.
Porter Five Force Model
The bargaining power of the suppliers: Low
The bargaining power of supplier is low for the shower industry. The reason which makes the industry highly competitive for the industry players is that the industry suppliers do not have the ability to introduce break through innovations. Along with this the industry consists of majority price-conscious people who are in need of low priced products because they feel, daily use products should not be high priced. Industry suppliers basically attract customers on minimal margins.
The bargaining power of the buyers: Low
The bargaining power of buyers in the industry is low because industry consumers are solely dependent upon plumbers to make purchase for them for showers. They are relying on plumbers to select the shower because ultimately plumbers are ones who fix it. Along with this, the industry manufacturers do not advertise the products, they manufacture which again makes the customer unaware of the new technology.
Threat of substitutes: Medium
The threat for substitute in the industry is medium. The reason for it has been the availability of bathtubs that have slowed down the progress of conventional showers. Along with this different products have also come up in the industry such as mixer shower, integral shower and electronic shower.
Degree of rivalry: High
The rivalry in the industry is high. All industry players are competing with each other on low prices and discounts offerings. The products are classified into two categories value, standard and premium priced products.
Threat of new entrants: Low
The threat of new entrants in the industry is low. The market is already a mature industry which makes it less attractive for new entrants. Along with this the profit margins for all industry players is low which again makes it less attractive for new companies.
VRIO Analysis
The product Quartz by Aqualisa comes under Temporary Competitive Advantage because of the competitive implication the product has. The reason it has Temporary Competitive Advantage because the technology used by the company is rare with easy to use concept, but it is not costly to imitate and competitor can copy it anytime. As the case explains, Rawlinson was worried that although it is an innovative product but it can be copied easily and Quartz had to benefit with the current situation and earns maximum revenues..................
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