Thursday, October 3, 2019
Manchester Products Essay Example for Free
Manchester Products Essay Manchester Home expanded household furniture division by adding market leader PLFD Ã¢â¬â Addition of 990 million in PLFD revenues Ã¢â¬â Addition of established sales force, talented design teams Ã¢â¬â PLFDÃ¢â¬â¢s Signature Style line very popular with consumers Ã¢â¬ ¢ Ability to combine PL design skills with MH engineering and manufacturing Ã¢â¬â Manufacturing expertise and ergonomic designs Ã¢â¬ ¢ Concerns Ã¢â¬â How to tie-in PLÃ¢â¬â¢s bold designs with MHÃ¢â¬â¢s conservative style Ã¢â¬â Customer confusion over new brand name 5CÃ¢â¬â¢S OF THE ACQUISITION Company Ã¢â¬ ¢ CompaniesÃ¢â¬â¢ strengths and weaknesses complement each other 5CÃ¢â¬â¢S OF THE ACQUISITION Customers Ã¢â¬ ¢ Target consumers ages 34-55; Income over $50K Ã¢â¬â MH consumers are categorized as conservative elegance Ã¢â¬â PLFD consumers are more fashion-conscious, trend setters Ã¢â¬â Will need a way to reach both customer segments Ã¢â¬ ¢ Results from target consumer surveys Ã¢â¬â Low brand loyalty Ã¢â¬â 60% would change brands Ã¢â¬â High information search Ã¢â¬â Style, design, quality, comfort most important qualities Ã¢â¬â all covered by MH/PL Ã¢â¬â PL has high brand awareness, almost double that of MH, will help to co-brand them to raise awareness for MH 5CÃ¢â¬â¢S OF THE ACQUISITION Collaborators Ã¢â¬ ¢ Manchester already has network of office distribution channels, now they gain access to household distribution channels through Paul Logan. Ã¢â¬â PL sales force has strong ties to leading distributions channels Ã¢â¬â PL strength in upscale furniture stores, specialty stores, department stores Ã¢â¬ ¢ Strong relationship with buyers Ã¢â¬â Concern over brand going away, necessary to create a smooth brand transition so consumers make the switch Ã¢â¬ ¢ Push strategies important to build strong relationships with distribution network Ã¢â¬â 90% of PL shipments include Purchase Allowances 5CÃ¢â¬â¢S OF THE ACQUISITION Competitors Ã¢â¬ ¢ Paul Logan was market leader Ã¢â¬ ¢ Household Furniture Industry $36.64 billion in 2004; positive % growth projections A mature industry Large number of corporate consolidations Low-cost imports from Asia/Mexico moving into higher price levels Domestic companies ready to attack the vulnerability of the new brand and position Ã¢â¬ ¢ We need strong advertising and marketing mix Ã¢â¬ ¢ Many competitors have company owned stores Ã¢â¬â Crucial to leverage our distribution channels to gain market access 5CÃ¢â¬â¢S OF THE ACQUISITION Context Ã¢â¬ ¢ Office furniture sales growth tied to employment growth and new business formation. Ã¢â¬â Burst of dot.com bubble and recession have decreased demand for office furniture Ã¢â¬ ¢ Rise in Ã¢â¬ËteleworkingÃ¢â¬â¢ could increase demand for home office Ã¢â¬ ¢ Demand for home furniture is tied to new home construction and home sales. Ã¢â¬ ¢ Innovative and stylish products to bolster demand MOVING FORWARD ANALYSIS OF FUTURE BRANDING: OPTIONS Ã¢â¬ ¢ Drop the Paul Logan name right away Ã¢â¬â Losing their current brand awareness Ã¢â¬â Need to educate customers Ã¢â¬â Strong distribution channel relationships could be damaged Ã¢â¬ ¢ Keep using the Paul Logan name for the entire allotted three years Ã¢â¬â Ad agency advises against this option, as they donÃ¢â¬â¢t want to allocate advertising dollars to a brand with a three year shelf life Ã¢â¬ ¢ Transition mid-point Ã¢â¬â Leverage the Paul Logan name to build strong brand awareness for Manchester Ã¢â¬â Continue to use the PL name in subtext for 1.5 yrs.; conduct consumer research to reevaluate after this time. Ã¢â¬â Business recommendation to convert the name 100% to Manchester Home after 1.5 yrs. ANALYSIS OF FUTURE BRANDING: OPTIONS Ã¢â¬ ¢ Brand name transition: Ã¢â¬â First 6 months: Manchester Home: The New Home for Paul Logan Furniture Ã¢â¬â Following year: Manchester Home: The Home for Paul Logan Furniture Ã¢â¬â After 1.5 yrs.: Conduct consumer research to reevaluate transition Ã¢â¬ ¢ Business recommendation is to drop the Paul Logan name Ã¢â¬ ¢ Want to ensure the Manchester Home brand has achieved a sufficient awareness before removing PL OUR FUTURE ADVERTISING STRATEGIES Ã¢â¬ ¢ Strong campaign is critical to the success of the new brand name Ã¢â¬â $184 million allotted for 2005 Ã¢â¬â Includes national and cooperative advertising for both PLFD and MH products Ã¢â¬ ¢ Push vs. Pull Ã¢â¬â MH to allocate more $ towards Push advertising Ã¢â¬â Heavy Push Pull the first 1.5 yrs. Ã¢â¬â Marketing Communications mix to form long-term company image Ã¢â¬ ¢ Promotional Programs Ã¢â¬â Purchase allowances Ã¢â¬â Recommend amending the planned 2005 marketing expenditures to allow for purchase allowances. Ã¢â¬ ¢ Currently based on % of sales Ã¢â¬â Due to brand transition, allocate a fixed amount to advertising to ensure the levels do not drop RECOMMENDATIONS Ã¢â¬ ¢ Continue to use the Paul Logan name to leverage brand awareness and channel partnerships Ã¢â¬ ¢ Focus strongly on both Push and Pull strategies the first 1.5 yrs. to communicate the acquisition Ã¢â¬â Amend proposed 2005 advertising plan to incorporate more Push strategies, specifically Purchase Allowances that contributed to the success of the PL distribution network Ã¢â¬ ¢ After 1.5 yrs., the business goal is to transition brand officially to Manchester Home QUESTIONS?