Submitted by,

Pritam Das- 12DM006Sunil Acharya- 12DM009

Priyanka Bhattacharya- 12DM011Jyoti K Mohapatra- 12DM023

Akash Prusty- 12DM093

Case Introduction

Compaq has increased its market share from 3% to 46%. It has decreased the market share of Toshiba from 60% to 40%

Compaq was using Intel as the processor till date.

Introduction of new notebook series with reduce price.

Intel is the leading processor of the market and hence a costly one.

Compaq’s dilemma of introducing low cost note book series with processor AMD and Cyrix.

Comparative study of Note books with Intel with AMD and Cyrix

INTEL

Costlier

Market Share- 84%

No supply Problem

Porter’s Five Force analysis

Suppliers: Intel in comparison to AMD and Cyrix is superior in market share and also the acceptance is much among the buyers.

Buyers: Due to the increase in the market competition and hence reduction of the price the main advantage is enjoyed by the buyers.

New competition: As the industry have no alternative hence the threat of New Competitors.

Threat of Substitute: Introduction of new low cost system with more efficiency by existing players cannot be avoided.

Rivalry: As the market have no alternative hence the rivalry in the form of huge competition always exist.

Analysis of the researchTwo-Third customers are willing to move with alternative processor.

Customer spending less than $2,500 are having affinity towards AMD processor and those paying $2,500 and more prefers Intel.

Main reason for switching brand is gaining Price discounts and Performance benefit

If Compaq introduce alternative processor the combination of low price and brand recognition could preserve its market share or even can enhance it.

Consumer wants to see the system in the market before making any decision of buying the same.

If Intel change strategy and provide a low price deals customer have a chance to move to lack the interest.

Compaq with AMD

Lesser costNeeds to establish the brand first.Buyers does not give emphasis to the quality of processor but wants discounts.

Compaq with Intel

Existing brand.Costlier.No reason to switch brand.

Comparative study for both the processor

GROUP DECISION

As two types of customer exist in the market- price sensitive and quality sensitive, two different types of notebooks should be launched.

One with the AMD processor and other with the Intel processor.

RESULT

Compaq’s launch will hit the price sensitive customer and hence the customer will buy such notebooks.

Also the customer who wants to judge the notebook on the basis of the market presence of the product can evaluate and hence changing to Compaq’s customer with the AMD processor.

The quality sensitive one can always buy the preferred one with Intel and hence Compaq can retain the existing the customer with adding new customer as well.

THANK YOU