Loctite Corporation Industrial Products Group Harvard Case Solution & Analysis

Customer Analysis

The role of BAM 2000 in the adhesive market is to penetrate with its low cost and high quality features. Basically, the company should look to focus on the increasing share of adhesives in the industry which are growing at a rapid pace of 10% per year. With the launch of BAM 2000 the company can focus on increasing its existing market share through the market. Along with this, the role of BAM is to cater the needs of industry clients that are price sensitive and look for cheaper products with average quality. To actually satisfy them BAM 2000 can be of good use. Although, the industry is not sensitive to high prices but introducing such a product will support the company in the future endeavors.

Company Analysis

The role of BAM 2000 in the current product line of Loctite Corporation will give it a new market to cater. As the case states, the industry is not a price sensitive one and customers are willing to pay higher prices for such products. But since BAM 2000 will be launched, hence, it will provide the option of purchasing low cost adhesive dispenser. As Loctite Corporation is a premium brand with high prices superior quality products, therefore; BAM 2000 does not fit in well with the current image of the company. The product is low priced therefore; the recommendation is to place it as a separate brand for the company to make it a successful product. BAM 2000 may not fit in well with the current distribution network of the company. The reason for this is that Loctite brand is an established entity and people recognize it. Since BAM 2000 is a new product with low price; so it should be distributed rigorously and should be catered by more than the current distributors.

The economic impact of BAM 2000 on the company will be a positive one for the company. In spite of having premium products such as SuperBonder, now with the introduction of BAM 2000 the company will also have a cheaper adhesive dispenser; which can again increase the economic condition of the company. Therefore, the idea of launching BAM 2000 is a positive one. Cannibalization within IPG System Division applicator is not a problem for the company because it caters different levels and it will not be a pragmatic for SuperBonder.

Competitor Analysis

Comparing BAM 2000 with the competitor products is quite cheaply placed within the industry. Competitors have the similar product with automated dispensers, while BAM 2000 is a manual adhesive dispenser. But since the competitors do not have the resources and enough operational command they are likely to pose a threat to BAM 2000. However, if BAM 2000 proves to be a successful entity or adhesive dispenser then it is more likely that competitors will come up with a similar product. Moreover, if BAM 2000 is successfully launched in the market and integrates the industry; then it will encourage other players like Eastman and Permabond to develop similar adhesive dispenser for the companies too. However, since BAM 2000 is the first of its kind therefore; it will get the advantage of being the first mover in the industry. The marketing campaign of BAM 2000 is basically to educate customers about the features and qualities of this new product by the company.

Marketing Mix

Product

The position statement for the target market is to introduce a low cost adhesive dispensing system using Gluematic tip. The purpose of this new product will be to entertain the difficulty and problem of assembly line workers who were using CA for the one ounce and small bottles. Therefore, to overcome this situation a new product was launched as Bond-A-Matic 2000 (BAM). The product has been developed under two models, one is the low pressure model with plastic reservoir and the other is high pressure model with aluminum reservoir.

Along with this, Gluematic tip was especially designed to dispense adhesives on hard surfaces. However, the Vari-Drop applicator was developed for soft and smooth surfaces. Basically, it dispensed adhesive through detachable needle which could be replaced with worn.  The recommendation for the name is to keep it as a separate entity and product for the company without making the use of parent company brand name. The reason for this is as the case states, with Loctite Corporation people associates high quality expensive products and Bond-A-Matic was still not tested by the company, therefore; it should be used as a different product. For the trial offers, Loctite Corporation should send the product to its clients for free as a sample, make them use the product and develop a small packet of BAM 2000 where regular clients of the company can understand the product. The company should manufacture both the low and high pressure models because both serve different target ............................

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