Presented By : Presented to:Rao Muhammad Fahad Nooman MehmudAsia SheraziImran BukhariMuhammad AfzalSobia Hassan

Arctic Power(Case Study)

Synopsis

The case sets the scene where Colgate-Palmolive-Canada was confronted with a situation of whether to continue developing their strong markets, in the Quebec, Maritimes, and British Columbia region, for its cold water detergent brand i.e. Arctic Power or to try to build its market share in the rest of Canada. In other words it had to decide on the “Strategic Direction” and their “Product Positioning” for Arctic Power for the year 1988 based on its experiences in the previous years.

Second, they must decide whether to use a single positioning strategy (as was successfully implemented in Quebec) or continue to use a dual positioning strategy. The dual strategy consisted of highlighting Arctic Power as a superior detergent in areas with strong sales, and focusing on encouraging Canadians to use cold water washing in areas with relatively weak sales.

In early 1980’s “Regional Brand Strategy” was adopted under which the main objective was to assign the resources to those areas where the brand had a strong and profitable share. Resultantly, Arctic Power’s national share significantly increased.

KEY ISSUES

Intense Competition

• The brands were well established. Thus the competition was among clean to cleanest and sales could grow only by taking over share of others.

Constant Repositioning

• The main brands positioned themselves on:• Cost (ABC)• Quality (Sunlight with fragrance) &• Ingredients &temperature (Tide, Arctic

Power)

Segmented Target Market

• Canada has two major cultural groups, the English and the French. Hence brand image and awareness needed to be build in rest of provinces for detergents differentiated to be suitable for cold water washing.

Internal AnalysisStrengths

1. Support of Colgate

Palmolive International2. Plenty of stability and

credibility with their customers,

suppliers, and retailers.

Weaknesses1. Poor product positioning &

marketing.2. Expensive detergent. 3. Feel of lacking in quality.

Opportunities1. Sufficient

financial resources.

2. Distinctive Quality to set it apart from its competitors.

Threats1. Giant

Competitive firms.

2. Slow growth in the detergent

market.3. A loyal

customer base for Tide.

Core Problem

Core Problem

• Arctic power’s positioning strategy had not been successful in creating brand awareness and brand image as better cold water cleaning detergent since it was not based on regional requirements.

• Despite spending huge amounts on advertising, Arctic power could not gain its aimed market share in some provinces. It has weak brand image when compared with Tide. Tide is the name that comes to the minds of the consumers when it comes to washing clothes.

• 1) Arctic Power must focus its strategy on becoming THE cold water laundry detergent.

• 2) Align the products price and production costs to match the perceptions of the Canadian market.

Alternative Solutions

Product Reformulation

Product Innovation

New Distribution Channels

Increased Advertisement

Brand Positioning On Regional Basis

New Product Strategy

Region Based StrategyNational Maritimes Quebec Ontario Man/Sask Alberta B.C.

Stops Shrinkage

Saves Energy Protects Color

Cheaper

Saves Hot Water

Color Stays Bright

Saves on Electricity

Easier on Clothes

Positioning Strategies Competitive Advantage, Adaptive, Head-on-head , Feature Driven, Defensive, Rivalry based.

Marketing Strategies Aggressive Advertising, Exit, Promotional Focus.

Our Positioning Strategy

Defining the market in which the product or brand will compete

Identifying the

attributes & Determine

each product's share of

mind

Collecting information

from a sample of customers about their perceptions

of each product on the relevant attributes

Determine the target market's preferred

combination of attributes (ideal vector)

Position

Porter 5 Forces

Competitive intensity and therefore attractiveness of a Detergent market

Conclusion

•We rejected continuing on Arctic Power’s course to expand because the costs associated with expanding into Canada were far greater than the increase in revenues. 1•The competitors, particularly Tide, responded strongly to efforts with promotions of their own, causing Arctic Power to further reduce prices and profitability2

•We decided the best course of action for Arctic Power was to target the growing cold water market at the regions specified with specific strategy and to become Canada’s leading detergent.3

)THANK YOU