Marketing scenario
Positioned as an premium offering focused to lowest overall cost to end users through superior overall performance. Leader in quality , performance and technological innovation Product lines Carton sealing and industrial tapes Specialized adhesives Other packaging products SKI tape - Manufactured using patented technology and a brand name for pressure sensitive carton sealing tape
Every high tensile strength and sheer resistance Positioning High Price K Products Low Quality High Quality 'pack Tensile New Product Low Price Problem Statement ; K tape competed against inferior economy grade products in carton sealing type ; 'PACK offered 25-35% lesser price ; Revenue of K- $68. 6 million 'PACK - $28. 5 million 2012 ; Tensile -a new competitor had $2. 7 million dollar sale with one sales representative Should SST stay with high quality product or enter the economy grade segment ?
Option 1: Enter the economy grade segment under the same brand PROS Access to the economy segment Defend market share against competition Diversification of product portfolio CONS Dilution of the brand image as a maker of technological superior product Conceptualization of its own product offering Accoutered product line Option 2: Enter the economy grade segment under different brand Implications for: Customer ; Ability to fulfill need of price sensitive customers ; Possibility of change in perception of being a quality leader
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Distributor ; Possibility to offer a low end SST product ; Even wider product range; Limited sales force Sales Force ; Ability to offer more variety in terms of price levels ; More effort to explain product differences Brand ; No positive impact ; Negative impact on brand image Option 2: Stay with high-quality products ; Maintaining image of quality Leader ; Loss of Market share; Not targeting price sensitive consumers ; No need for adjustment in distribution policy.
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