Collaborations between METLA & INRA EFPA Research Department
1. THE PROJECT 2. AIMS 3. DATA & … Toivonen 2005 1 COMPETITIVENESS OF WOOD PRODUCT QUALITY & NEW...
Transcript of 1. THE PROJECT 2. AIMS 3. DATA & … Toivonen 2005 1 COMPETITIVENESS OF WOOD PRODUCT QUALITY & NEW...
Ritva Toivonen 2005 1
COMPETITIVENESS OF WOOD
PRODUCT QUALITY &
NEW PRODUCTS: EWP MARKETS & NEW MARKETS: CHINA
Metla/PTT project
Ritva Toivonen – Erno Järvinen – Raija-Riitta Enroth
1. THE PROJECT
2. AIMS
3. DATA & METHODS
4 RESULTS
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1. THE PROJECT • PERCEPTION OF QUALITY OF WOOD PRODUCTS AND
COMPETITIVENESS OF SUPPLIER COUNTRIES ON GERMAN ANDUK MARKETS: CUSTOMER VIEWPOINT
• PERCEPTION OF QUALITY FROM END-CONSUMER VIEWPOINT: END-CONSUMER MARKETS: FINLAND
• FUTURE MARKET PROSPECTS OF EWP PRODUCTS: CASE GERMANY: DELPHI STUDY / QUALITATIVE ANALYSES
• NEW MARKETS: CHINA AS POTENTIAL GROWTH MARKET FOR FINNISH WOOD PRODUCTS
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Questions • WHICH PRODUCT/SUPPLIER CHARACTERISTICS
ARE IMPORTANT ON WOOD PRODUCT MARKETS?
• CAN PRODUCT QUALITY BE DESCRIBED WITH SOME GENERAL DIMENSIONS/FACTORS – WHICH?
• ARE THESE CONSISTENT OVER MARKETS AND PRODUCTS?
• WHAT KIND OF CUSTOMER/CONSUMER SEGMENTS EXIST WITH REGARD TO QUALITY?
• HOW FINNISH SUPPLIERS PERFORM ON GERMAN & UK MARKETS?
• ENVIRONMENTAL QUALITY DIMENSIONS & INFORMATION?
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TANGIBLE PRODUCT
Technical
Aesthetic/Visual
Environmental/social
characteristics
INTANGIBLE PRODUCT
Product informationincl. brand,image,price
Supplier & related informationincl. image & reputation
Services
PRODUCT – A COMPONENT MODEL
•Total Product Concept: - physical and other characteristics of the product itself- services related to the product- other supplier activities, behaviour and characteristics such as company image
•Background:Product definitions(Lewitt, Kotler..)Quality studies(Garwin…Hansen, Bush, Sinclair…)
Theoretical background
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• Building material retailer/wholesaler companies operating in Germany & the UK
• Structured questionnaire
• The purchasing manager/directors
• Data collection: Germany 2000-2001, 76 companies
• The UK: 2003-2004: 40/52 companies
• Finland: private end-users: 2004, 150
• EWP-STUDY 13 experts
2. DATA
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3. METHODS
Statistical analyses:
Factor analysis: dimensions
Cluster analysis: market segments
Logit modeling: characteristics of segments
Delphi –method
Expert interviews
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0 % 50 % 100 %
Very importantFairly importantSomewhat importantLittle importantNot important at all
Technical quality (1.3)Technical quality (1.3)
SUPPLIER CHARACTERISTICS (1.3)SUPPLIER CHARACTERISTICS (1.3)SERVICE, logistics, information(1.6)SERVICE, logistics, information(1.6)Price (1.7)Price (1.7)
Aesthetics (visual appearance) (2.0)Aesthetics (visual appearance) (2.0)
Usability (2.3)Usability (2.3)
Environmental soundness (2.1)Environmental soundness (2.1)
General choice criteria of productsGeneral General choicechoice criteriacriteria of of productsproductsAll the 7 matters are fairly/very important on average(but some variation between respondents)
4. RESULTS
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0 % 50 % 100 %
Very important ImportantIndifferent Not very importantNot at all important
Technical qualityTechnical quality
Supplier characteristicsSupplier characteristics
Services, information and logisticsServices, information and logistics
PricePrice
OutlookOutlook
UsabilityUsability
Environmental friendlinessEnvironmental friendliness
Importance of overall product characteristicsImportance of overall product characteristicsImportance of overall product characteristics
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21%22%Total variance explained43%
1.11.3Eigenvalue 2.4
0.60Supplier Characteristics
0.83Service, information & logistics
0.56Environment
0.43Price
0.43Visual/Aesthetics
0.49Technical quality
Factor 2Tangible & Price
Factor 1
Intangible excl. PriceSupplier C, Service & information
Tangible andintangible
- separatedimensions
Price?
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0 % 50 % 100 %
Very important ImportantIndifferent Not very importantNot at all important
Product is safeProduct is safe
Wood originates from sustainable managed forests Wood originates from sustainable managed forests
Environmental impacts of production are smallEnvironmental impacts of production are small
Surface treatment is safeSurface treatment is safe
Information about environmental issues availableInformation about environmental issues available
Recyclable packaging materialsRecyclable packaging materials
Possibility to recycle the productsPossibility to recycle the products
Social aspects are respectedSocial aspects are respected
Importance of environmental characteristicsImportance of environmental characteristics
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“Green price premium products”““Green price premium productsGreen price premium products””
1. Parquet garden furniture
2. Laminate tropical timber
3. Panels
4. Furniture etc.
1. Parquet garden furniture
2. Laminate tropical timber
3. Panels
4. Furniture etc.
Interior materials/tropical timber/furniture
Interior materials/tropical timber/furniture
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1
2
3
4
5
WoodPlasticSteelConcrete
1=very good 2=good 3=moderate 4=bad 5=very bad1=very good 2=good 3=moderate 4=bad 5=very bad
Indi
vidu
alIn
divi
dual
War
m a
nd a
ttrac
tive
War
m a
nd a
ttrac
tive
Plea
sant
from
out
look
Plea
sant
from
out
look
Styl
ish
Styl
ish
Mod
ern
Mod
ern
Old
fash
ione
d
Old
fash
ione
dVa
luab
leVa
luab
leYo
uthf
ulYo
uthf
ulPa
ckag
es a
re c
lean
Pack
ages
are
cle
anG
ener
al im
age
is h
igh
Gen
eral
imag
e is
hig
h
Outlook and StyleOutlook and StyleOutlook and Style
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1
2
3
4
5
WoodPlasticSteelConcrete
1=very good 2=good 3=moderate 4=bad 5=very bad1=very good 2=good 3=moderate 4=bad 5=very bad
Envi
ronm
enta
l fri
endl
ines
s
Envi
ronm
enta
l fri
endl
ines
sSo
cial
acc
epta
bilit
y
Soci
al a
ccep
tabi
lity
Prod
ucts
hav
e an
eco
-labe
l
Prod
ucts
hav
e an
eco
-labe
lM
ater
ial i
s sa
fe a
nd
harm
less
for h
ealth
Mat
eria
l is
safe
and
ha
rmle
ss fo
r hea
lth
Ecological and social qualityEcological and social qualityEcological and social quality
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0 % 50 % 100 %
Very important Fairly importantSomewhat important Little importantNot at all important
Reliable (1.3)Reliable (1.3)
Price (level & stability) (1.5)Price (level & stability) (1.5)
Fast deliveries (1.6)Fast deliveries (1.6)
High product quality (1.3)High product quality (1.3)
Customer orientation (1.6)Customer orientation (1.6)
Wide product palette (1.9)Wide product palette (1.9)Ease of contact (1.9)Ease of contact (1.9)
Personnel respect customers (1.9)Personnel respect customers (1.9)
Importance of supplier characteristicsImportance of supplier characteristics
E-mail connection (2.0) E-mail connection (2.0) Payment arrangements (2.1)Payment arrangements (2.1)Friendly personnel (2.2)Friendly personnel (2.2)Image & reputation (2.2)Image & reputation (2.2)
Communication & order via Internet (2.8)Communication & order via Internet (2.8)Supplier is well-known (2.9)Supplier is well-known (2.9)Domesticity (2.9)Domesticity (2.9)
Respect for environment (2.4)Respect for environment (2.4)
Country of origin (3.0)Country of origin (3.0)
Supplier
Wood productsuppliers
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1. PRODUCT QUALITY (PHYSICAL PRODUCT)(very important)
2. PRICE (very important)
3. GENERAL CUSTOMER ORIENTATION (very important, results in products & service)
4. DELIVERY (fairly important)
5. RELIABILITY + SERVICE +COMMUNICATION(fairly important, reliability very important)
6. BEHAVIOUR & IMAGE (fairly important)
7. FAMILIARITY/ORIGIN (somewhatimportant/DTS)
1. PRODUCT QUALITY (PHYSICAL PRODUCT)(very important)
2. PRICE (very important)
3. GENERAL CUSTOMER ORIENTATION (very important, results in products & service)
4. DELIVERY (fairly important)
5. RELIABILITY + SERVICE +COMMUNICATION(fairly important, reliability very important)
6. BEHAVIOUR & IMAGE (fairly important)
7. FAMILIARITY/ORIGIN (somewhatimportant/DTS)
SUPPLIER CHARACTERISTICS - 5/7 DIMENSIONS
Business transactionsrelated to the product, valued in money
People, sentiments, abstract, no direct valuein money
Finalphysicalproduct
& value in money
17 ORIGINAL =>7 ATTRIBUTES5 SC dimensions
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Image & reputation
Well-known
Internet/email ordering
Environment
Friendliness
Paymentarrangements
E-mailconnection
Respect
Ease of contacting
Wide productpalette
Customerorientation
Delivery
Price
Reliability
Productquality
CanadaSwedenFinlandAustriaGermany
Performance?
= The mostimportant sc
Dark blue > 2.5 Fairlygood
Medium Blue 2.5-3.0 Moderate
Light Blue < 3.0Less than moderate
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0 % 50 % 100 %
Very effectiveEffectiveModerately effectiveFairly ineffectiveVery ineffective
GermanyGermany
FinlandFinland
AustriaAustria
SwedenSweden
CanadaCanada
Effectiveness of supplier BU’s marketing communicationGerman customer organisations’ perceptionsEffectiveness of supplier BU’s marketing communicationGerman customer organisations’ perceptions
Marketing communication
Developingmarketingcommunicationmay be a possibility to enhancecompetitiveposition!
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Conclusions• Tangible – Intangible form separate dimensions
• Fairly similar dimensions from all three data sets => indications of consistency of quality dimensions on different markets
• Environmental quality is important, but not the most important, environment and product information are tied together => availability of information!
• => appearance and health issues important and under utilised in total product concept, technical quality and supplier reliability the most important issues
• Company groups with different requirements exist, characteristics still under investigation
• Finnish companies are performing OK with technocalquality (physical product is no problem) => intangibles require development!
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Project continues:
Finalisation of studies
• Analysis of the UK data: 2005
• Comparison of UK/Germany
• Consumer markets: 2005-2006 with pilot data from Finland, possibly continuationcomparisons with organisation’s viewsenvironmental quality
• EWP-study and China are ready
• IT in marketing: the UK markets
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INTERNET
• 2001 most companies/BUs analysed hademail (about 90%) home page (about 75 %) in Germany
• Internet was not commonly used so far for actualsellingBut this was expected to increase fast!
• In choosing suppliers was internet/email communiation ranked surprisingly high.
• ”Being in the Internet will be necessary for ourcompetitiveness during the next few years”German respondent BUs
• Internet provides a possibility to create competitiveadvantage for wood suppliers through improvedservice and communication.
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INTERNET IN MARKETING OF WOOD PRODUCTS IN GERMANY
Internet home page and email in Germancompanies trading construction materials2000/2001 (71 companies)
No HP, 10 % Under construction,
1.5 %
Shared use within the Co-op 17 %
Home Page 72.5 %Internet home page, % of BUs
No email 10 %
Under construction 1.5 %
Shared use within the co-op 7 %
Email in the company 82.5 %
Email in use, % of BUs