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Xiameter Case Solution & Answer

 What did the new segmentation approach reveal about customers beyond that which the company already knew?Further…in what ways was this “needs-based” segmentation an improvement over their previous, traditional end-user segmentation approach?Discuss.

Since its inception, the companyremainedfocused on the existingcustomers, offering different products of silicones, depending on the market changes, or customer demand.In doingso, it indulged itself so deeply into the customer needs that it failed to address the changing market trends and the needs of the other markets.

Primarily, thecompanyfocusedon the west market and failed to incorporate the changes of Asian market in the marketing strategy of the company, which became one ofthe emerging markets, making the model of need-based approach more renowned.In such amodel, the customs demanded for the cost effective siliconproducts with highquality. Andsince the company failed to analyze such trend, the newentrants captured the market share, leading to immense loses.

Apart from this, it canbe said, on the launch of Xiameter, the company developed a new marketsegmentationapproach.In doing so, it segmented the market on the factors such as price seekers, cost effective solution seekers, innovative solutions segment and proven solution segment that needed different solutions and services, dependingon theneed.For instance, the proven solution segment needed the solution pack with drivenresults that merely don’t have substantial assets or financialsupportfor the research anddevelopment function.

On contrary, underthe end usersegmentation, the companypursued thestandardized approach toofferthe service to the customers. In doing so, it targeted the customers with similar needs anddemands andthus, offered the sameoffering throughout the segment, through same integrated channel. Though in initial, such approachremainedasuccess factor for the company, perhaps, in the latter year, such approach made the company overlook the other segment with emerging needs, leading to the entry of newplayers and hence loss of market share.

3- In tracing the development of Xiameter from its beginning, discuss what were the key decisions (in your opinion) that shaped its successful business model and strategy?

The company initiated with the dual brandstrategy in order to incept the Xiameter in the market, whichhasbeen developed to target the cost effective and cost sensitive marketsegment. In doing so, according to my opinion, following are the decisions that the company took right and that allowed it to shape the businessmodelsandstrategyleadingto success.

  • The Dow Coming adopted a dual brand strategy. Suchstrategyallowed it todevelop a separate brand strategy for the Xiameter, allowing it to refrain itself from cannibalizationof other existing products in the market.
  • This allowed it to maintain a different and distinctbrandimage in the mind of the consumer, securing the brandvalue from deteriorating due to brandambiguityand offering in the market.
  • In addition, the company made Xiameteranautonomousbusinessunit of the company, allowing it to develop its own strategies, business plan, objectives and management teams, leading to better execution andadaption to change.
  • Also, the company adopted the website approach in order to pursue the Xiameter in themarket. Such strategy has been distinct, since no other businessplayer has beenoffering the silicone through such channel.Suchapproachallowed the companyto reduce its supply chain and logistic cost and alsohelped inmaintaining the orderstatus and ratio, depending on the ROI generated through each channelandthe demand criteria derived through the analysis of different market trends…………

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