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Industrial Chemicals, Inc.

Pigment Division

Business Marketing : Group 3


Deepak Sasikumar
Robin Bansal
Tejas Shah
Vikas Guleria
Saurabh Wagh

13P019
13P035
13P046
13P056
13P057

Case Facts
Linda Yu: Vice President, Marketing
Hugh Swann: Vice President, R&D
Terry Lamb: Vice President, Sales
WP-88: specialized white pigment and colour enhancer used in a wide

variety of differentiated top of the line products like house paints,


industrial coatings, textile paints and printing inks
Sales growth of WP-88 was 50-60% in the last couple of years is now

expected to flatten out in the next 3 years


Linda suggested that the company starts offering in-depth technical
service over and above the product

Marketing Viewpoint for sale of Service


Easier to pitch to a customer of the company
Opportunity to explore the wide applications that WP-88 offers and educate

the customers
Additional sales opportunities more revenues from the existing customers
and the smaller companies that lack technical expertise

Get information rich feedback through the field engineers


Get ideas about future potential products from the customers itself
Builds reputation and increases credibility
Industry leaders in other major business success based on more and more
technical collaboration with customers in developing new products

R&D viewpoint for sale of service


Looking to enlarge the divisions research lab and hire more staff rather than
cutting
Focus on bringing another big new product through a concentrated R&D, thus
no dilution of efforts
Tech service Formulation chemists and field engineers are a costly affair and
not easy to find
No clarity on what kind of tech service was being talked about to implement
Confidentiality issues between the different customers and the tech team
Sharing of new developments acquired from one customer with different
customers

Sales Viewpoint for Sale of services


Tech service is just an added expense, present concentration is on profits
Big customers pushing for lower prices and are not concerned about more
service
Tech service people lack of a business mind - would bring more problems
rather than more orders
Requirement of salespeople much more important than tech-service person,
the former will always generate more orders
Lack of clarity on the hierarchy set up for the tech service people
Lack of success in Europe and smaller specialized US companies

Present Scenario Analysis


2 sets of customers
Inexperienced buyers Smaller companies
Experienced buyers 2 or 3 major buyers making up most of the market
Smaller companies focusing more on technical support as compared to the
bigger companies pressing on lower prices rather than any kind of service
Product Life cycle for WP-88 moving towards the later growth phase capable
of new wider applications while the customer evolution phase still in the
introductory stage for the smaller companies and in the maturity stage for the
bigger companies, i.e., the experienced buyers

Recommendations
Reduction in the price of the WP-88 to the bigger customers due to the rise of
the price-sensitive segment in the present slow growing market, thus fear of
losing out the major customers

Target the smaller companies with the tech service support as desired by
Linda along with customer education for the product

Focus on bringing new differentiated products for the industry as the market
is moving towards saturation and use the customer relationship to generate
greater profits via the new product sales