Brita: In Search Of Winning Strategy Case Solution
The case discusses BRITA GmbH Company, which is a German Water Filter Company. In the year 1988, the company’s marketing rights were obtained by Clorox Company. The company is one of the leading companies in the industry. It had a revenue turnover of around 4.39 billion in the year 2005. The company’s operations are spread in about 25 countries and in markets of more than 100 countries around the globe and employ overall 7600 employees. BRITA created PT (Pour-Through) water filters, the product was a success and led the company to obtain around $ 200 million in initial 4 years of its operations. In the year 1999 the company became globally available with around 70% product awareness while in the US about 18% of the US population were using its product. In the year 1990 the company dealt with stiff competition with the increasing competition in the market of water filters and the competitors came up with new products other than BRITA. (Chattopadhyay, 2007)
From the year 1990, the industrial competition for BRITA substantially increased and in 1998 PUR came up with the new product called FM(faucet-mounted) filter, a better alternate to the company’s PT filter (then it was the only product of the company).This new FM filter with its feature to eliminate illness-causing contaminants gave a strong competition to the PT filter that led to an abrupt decline in company’s sales. With the launch of bottled water in the year 1990,the market of filtered water was changed overall. The bottled water business grew so fast to the extent of acquiring 8% of the population giving preference to their liquids. The company used and implemented several strategies to recover its sales but nothing worked.
In this report, we have to present a winning strategy for BRITA to remain and revive its significance in the water filtration industry by targeting all sources at home, school, office etc. and providing easy access to clean and healthy water to everyone.
In that report we present the present market situation, consumer tendencies and categories and whose aspects need to lie targeted as a part of a latter strategy. Long-term and momentary techniques or how we will use them to revitalize the BRITA brand into people’s minds, instruct them concerning the value of clean lotus because the fitness then benefits humans and for that reason increase sales.
Following are the market segments based on the segmentation study for water consumption.
- Tap traditionalist,
- Weary Tap Satisfied
- Principled Filter Fans,
- Affluent Fridge Followers,
- Assertive Self Improvers,
- and Bottled Water Indulgers.
The reason behind this segmentation was from these groups the majority of people are willing for water consumption without any contamination. Based on the target market selection criteria the segments that have been selected are Affluent Fridge Followers, Principled Filter Fans and Assertive Self Improvers.
These segments were selected to target because of the beliefs they hold. According to Principled Filter Fans, filter water is healthier than that of tap. According to Affluent Fridge Followers,filtered water is beneficial in controlling weights while in the view of Assertive Self Improvers, greater consumption of water is necessary to maintain health. Filtered water is often preferred for urban people because they believe it to have huge benefits. The major consumers of water are Assertive Self Improvers, based on the research done, it is said that most people drink water in their homes.
Answer no. 2
To target only these segments the company would require great time and investment to persuade peoples’ attitude toward tap water and filtered water. It would have to invest a great amount of capital in the R&D and the marketing campaigns as well.
Since the selected target markets were Affluent Fridge Followers, Principled Filter Fans and Assertive Self Improvers, these would be further divided into two groups based on the time for which the decision marketing strategies are implemented. These groups are
- Short-run strategy
- Long run strategy
For the short run strategy, sales would be proposed to go up by targeting Principled Filter Fans and Assertive Self Improvers because Principled Filter Fans are the most consumers of PT while Assertive Self Improvers are the consumers of mix pitcher and FM (faucet-mounted).
Furthermore, it was observed that as compared to people being out of their homes, they consume most water at their homes. Moreover, it could also be depicted based on various researches done that this industry has a great potential to grow.
For the long run strategies,the focus of the target is Affluent Fridge Followers, which includes the people with age after thirty or in their thirties.These people are literate and working and prefer maximum water consumption regularly for healthy life and they would consider consuming at their maximum convenience. It is a very large segment of water consumers and if BRITA is successful at targeting this group effectively then it would help BRITA to secure a larger market size.
Answer no. 3.
A communication strategy of marketing is the strategy of a company to send its message or advertise its brand to the right people at the right plan and at the right time. In this case, the communication strategy would be to promote and advertise BRITA in the selected target segments because of their maximum preferences for consuming safe water without any contamination. These segments would want to consume water to increase their health and not to decrease it. The communication channels like television, internet sites, and magazines could be used as a medium to advertise the product to the targeted segments.
In the first step, the company would be working to achieve its product value proposition. It is a marketing strategy which is related to coming up with new innovations in the company’s product. For the purpose of value creation BRITA could reach out for various innovative steps in their product. Since its initial launch of its filters it had been using the same product with slight changes. As a part the long-term strategy, BRITA’s main focus would be on value preposition through product innovation by investing much amount of capital in the R&D, this way it would be able to achieve maximum market share by targeting the proposed Affluent Fridge Followers for long-run. This strategy would also help to motivate the current users of BRITA to continue using their filters and also would make BRITA to target more groups………………………….
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