To understand why the initial marketing strategy didn't work,;let us put some light on the the reasons why

initial
sales were low:
1.The sales team was not working efficiently.They were spending only 10% of time to gain new customers while a
new and innovative product like Quartz requires to identify its target customer segment.
2. Plumbers were reluctant to install Quartz because of their prior experience with failure of electronic showers.
3.Even though it was an excellent product it was not positioned properly.
I strongly feel that Rawlinson should still target the Independent Plumbers. The marketing strategy of Quartz
should consider the following points
1.From Exhibit 4: In 73% of the selection of Mixer showers is done by plumbers. From Exhibit 5: 54% of the
showers are installed by independent Plumbers. So plumber has a strong hold on sales of showers and that should
not be ignored.
2. The plumbers tend to like Quarts very much once they install it. So it is very important to promote the product
among the plumbers
3.Aqualisa can provide special incentives/rewards to the plumbers who refers Quartz to other plumbers to
increase the confidence.
4. On the price front i believe that price was quite logical since it was an unique product and 5 year warranty was
offered(Exhibit 9). Quartz should be marketed as cost efficient since it has low cost of installation(Plumbing and
excavation)
5. The product placement should be done as an essential product for the new generation and not as a high priced
niche segment product.









Statement of the Problem
Aqualisa has not established the proper mix of product, place, promotion, and pricing for its revolutionary Quartz
shower valve. The company has relied on the same marketing mix approach for the Quartz as its other products
and this has resulted in disappointing initial sales numbers. Also, Aqualisa has not devoted the necessary time
and effort to soothe the fears of consumers who are wary of electronic showers. Finally, the sales force has not
spent adequate time recruiting new customers and securing distribution through the existing network of plumbers.
The existing network of plumbers has not adopted the product as readily as expected, which indicates that there is
not a strong trust in the brand.
Issues and Analysis
The marketing mix is the combination of product, place, promotion and pricing and it is subject to both the internal
and external constraints of the marketing environment. Aqualisa has developed an appropriate marketing mix for
its existing products and has operated successfully and profitably. Unfortunately, the same marketing mix cannot
be applied to a product as radically different and revolutionary as the Quartz. Before we can consider the right mix
of product, place, promotion, and pricing (the four Ps) for the Quartz, we must first analyze our target customers
so we know how to create the right mix for that customer.
We performed a market segmentation analysis (Exhibits 1-7 and 1-11) which identified six potential target
customers: Standard Customers, Value Customers, Premium Customers, Plumbers, Property Developers, and Do-
It-Yourselfers. The analysis revealed that the three direct customers (standard, value, and premium) can be
reached through the influence of the plumbers and showrooms. Per Exhibit 1-1, plumbers are responsible for
selecting the type of shower for more than 75% of shower purchases in the U.K and Aqualisa could capitalize
significantly by focusing on plumbers. The property developers could generate large guaranteed sales volumes, but
this would not materialize for a few years due to lengthy construction timelines. The Do-It-Yourselfers would
require direct consumer advertising and Aqualisa does not have strong brand recognition in the market among
consumers at this time.
Product
Our analysis of the Five Cs, Five Forces, and SWOT at Exhibits 1-1, 1-2, and 1-4respectively, demonstrate
the innovative qualities of the Quartz and the impact it could have on the U.K. shower market if properly
marketed.
> There are currently no competitors in the market with a product that matches the potential of the Quartz
and now is the time to be aggressive and penetrate the market.
>The strongest force working against the Quartz is the availability of less advanced substitutes in the market which
lack the features of the Quartz; this is compounded by the fact that consumers are wary of showers that include
electrical components due to prior failures in the market and other potential malfunctions. We developed a
sample conjoint analysis survey (Exhibit 1-10) which would help isolate the features most important to consumers
when selecting a shower.
Place
Aqualisa has a presence in two of the three main distribution channels in the market. Aqualisa products are
available in approximately 40% of trade shops in the U.K., which are the main suppliers for plumbers. With the
exception of electric showers, trade shops are the dominant channel for all other shower types (Exhibit 1-3). The
trade shops would have to be reached more pervasively by Aqualisa in order to capitalize on the attractiveness of
the plumber segment. The showrooms are the main outlet for premium customers because they utilize displays
and demos to entice customers with style and design. Aqualisa products are currently available in only 25% of
showrooms; however, the visual appeal of the Quartz makes it a perfect addition to showroom inventories and
Aqualisa should consider making the necessary investments in demos and displays to increase its presence in these
venues. The third channel is the DIY sheds which offer discount, mass market, and do-it-yourself products directly
to consumers. Aqualisa brand products are not offered through this channel at all and it could be a difficult
channel to enter given Aqualisas lack of brand recognition in the consumer market.
Promotion
As mentioned above, Aqualisa does not have brand name recognition in the consumer market and does not
actively advertise to specific market segments. Most of the existing products are in the mature stage of their
respective product lifecycles and as such, sales growth and innovation have not been key concerns. The Quartz
is in the introductory stage of the lifecycle, but it is being marketed in the same way as current Aqualisa products.
Therefore its need for an aggressive promotion strategy to reach its target markets and drive sales has been
overlooked. The promotion strategies have not been customized for each segment and they do not demonstrate
the benefits to be gained (see Value Equation at Exhibit 1-5).
Pricing
To evaluate our pricing strategy, we have prepared a pro forma income statement (Exhibit 1-8) and a breakeven
analysis (Exhibit 1-14). Our breakeven analysis shows that Aqualisas breakeven quantity is 13,335 units when we
assume fixed costs of 4.1 million Euros per year. This equates to 36 units per day, which is not an unreasonable
outcome given the current sales volume of approximately 15 units per day. Our breakeven analysis maintained the
introductory pricing of both versions of the Quartz (standard and pumped) in order to evaluate the current pricing
strategy. Lowering the price would result in a higher breakeven quantity, which means it would take longer to see
profitability for this product line. Increasing the price would lower the breakeven quantity, but it couldalso price
the product out of reach of certain customers.
Recommendations


Target two main market segments: Plumbers and Premium Consumers (Exhibit 1-7).


Position product in showrooms and trade shops to reach target markets.


Create segment specific print advertising to address individual concerns and needs for the product(Exhibit 1-15).


Work internally with Sales team to focus more time on generating new accounts and not justmaintaining existing
clientele.


Maintain current pricing while appealing to new consumers in all segments by providingintroductory promotions
specific to their purchasing channels.Initial sales goal is to sell 100 units per day and maintain profit margins
as outlined in the Pro FormaIncome Statement (Exhibit 1-8). Long-term recommendations include targeting
additional markets suchas the Do-It-Yourselfers and exploring discontinuation of low margin products to increase
Quartz marketshare (Exhibits 1-6 and 1-9).
Support
Studies show that two of the three consumer segments (Standard and Value) rely heavily onPlumber opinions
and/or suggestions for the purchases of their bathroom fixtures (Exhibit 1-7). Giventhe strong influence they have
over their clients purchases, we want to be the number one brandrecommended by plumbers. Plumbers will
become our main target market to tap into several consumer segments and greatly increase our market
share within the industry.In order to appeal to plumbers, we need to demonstrate the value of utilizing our new
electronic product (Exhibit 1-12). We will emphasize its installation time being one quarter of what they are
usedto, and how this will allow them to install more showers in less time. Therefore, they will be able to takeon
more jobs and make more money per year (Exhibit 1-16). Due to its simple installation, they will also be able to
train apprentices on how to use the product and focus their time and energy on more intensiveand monetarily
rewarding projects. A specific brochure and advertisement will be released exploring theease and innovation of
our product (Exhibit 1-15).Our second target market will be the Premium Consumers who are mostly influenced by
style andlooks when deciding which shower to purchase (Exhibit 1-7). They are not price sensitive and
take performance and quality for granted. Since the Quartz has a higher price point and its aesthetics
areunparalleled in the current market, we are confident that it will do well with the premium customers.To reach
these consumers, we will focus on placing the product in showrooms and positioning the Quartzas being similar to
spa treatments in your home to elicit a luxurious and comforting feel (Exhibit 1-13).

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AQUALISA - COMPANY OVERVIEW
Aqualisa is a shower manufacturing company in the U.K. They make electric, mixer and power showers. They cater to people in all
the three segments namely Premium, Standard and Value. They sell electric showers under the name 'Gainsborough'. Rawlinson
took over as the managing director of Aqualisa in 1998. Aqualisa was having a 25% net return on sales and was having a growth of
5 to 10% in mature market when Rawlinson took over. Aqualisa has come out with a new product by name Quartz. Quartz is one of
its kinds in the shower market. It has been developed over a period of three years with a huge investment of 5.8 million. In spite of
its state-of-art technology it is unable to catch the market. Rawlinson, the managing director of Aqualisa, aims at a sale of 100 or
200 units a day from the current 15 units a day.
MARKET SHARE OF AQUALISA
As per the case study,
The major player in the shower market is Triton having sales of 30% of the total sales of showers in UK. The Gainsborough brand of
Aqualisa is the third major player in the market followed by Aqualisa. Aqualisa's leads the market in mixer shower sales and is third
in powers showers. It is fourth in the overall market. Its power showers are Aquastream Manual and Thermostatic. Its mixer showers
are Aquavalve and Aquavalve 609.Aquavalve 609 is the best selling shower of Aqualisa.
MARKETING PLANNING
Malcolm McDonald (2008) defines Marketing Plan as follows in his book
"It is a logical sequence and a series of activities leading to the setting of marketing objectives and formulation of plans for achieving
them."(Chapter 1)
A marketing plan essentially consists of
1. SWOT Analysis
2. Marketing Objectives
3. Marketing Strategy
Further in this report, we discuss the marketing plan of Quartz
The major issues lying in front of quartz were
1. Quartz made a sales of only 15 units a day. Whereas Rawlinson was looking at selling 100 units a day. Rawlinson's managers tell
Quartz is a niche product. Now the challenge is to bring quartz into the mainstream.
2. The plumbers are reluctant to try new electronic products. Even though plumbers appreciated the product at the introduction they
were not ready to install it fearing it might fail like the electronic in 80's.
3. The third issue was Aqualisa had low brand awareness among consumers. So the consumers did not have much knowledge about
the breakthrough product.
Analyisng the Strength and Weakness of Quartz
Strength:
The quartz was a breakthrough product in the shower market. Till then, manufacturers only recycled their main product once in five
years. No shower had used technology as much as quartz did.
Quartz could be installed in half a day whereas the other showers took 2 days for installation. Moreover, the shortage of plumbers'
problem could be addressed by the quartz. The plumbers could attend to more houses if they saved time and the consumers could
also save money if they had a plumber working for only half a day. Plumbers charged between 40 to 80 an hour. Calculating
plumber's wages at a rate of 60 per hour, a consumer saves a lot through quartz.
Even if the plumber raise their wages level, the product is still beneficial. A plumber could also attend to more clients.
Most showers in UK required excavation of wall. This problem was also addressed by quartz. Quartz was very simple to install and it
only needed a small place to place the remote processor.
Quartz was also more reliable. The fact that they looked great is evident from the initial sales figure. The quartz was getting popular
among showroom visitors. It was more suitable in houses with kids and older people as it did not require any adjustment every now
and then during a bath and there was no variation in pressure of water. The quartz on the whole had a lot of strengths which when
marketed well could really make this breakthrough product a huge success.
Weakness
The sales team of Aqualisa spent 90% of their time on existing customers and had very less time on developing new customers.
Moreover, the sales team was smaller in size. There was only 20-person to maintain existing as well as develop new customers.
Aqualisa was not very popular with customers directly. Only triton managed to build awareness at consumer level so far. As
Aqualisa was not popular with consumers, they were not aware of this wonderful product.
There could be one more challenge for Aqualisa if quartz entered mainstream. Quartz might start competing with the core product of
Aqualisa. But worked out the right way, this weakness could become strength.
Opportunities
The biggest opportunity quartz has at the moment is that there is no similar product in the market at the moment. If they tap the
market now, they could become market leaders.
Lots of replacements of showers happen in the UK. Quartz could tap this segment to improve their market share.
The quartz has used technology to the core in a shower like no one has ever been done before. This makes it the USP of Aqualisa.
And there is a good % of new business which can be developed .
Quartz is THE PRODUCT that could really take Aqualisa popular in every segment if the marketing strategy adopted is really
efficient. Discussed below are strategy which could make Aqualisa MARKET LEADER.
Objectives :
Rawlinson aims at selling at least 100 units per day. From the SWOT analysis , we can see that Aqualisa has opportunities of
improving sales by developing new customers. Aqualisa has its presence only in 25% of showrooms. The goal should be to
increase their presence in more number of places. Their presence in tradeshops is also not significant. If they make their product
more popular among plumbers, it is essential that they work on their channels of distribution.


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