Rohm and Haas New Product Marketing Strategy

Case Analysis: Rohm and Haas (A) New Product Marketing Strategy

2013-09-20

Team 8

HYEJIN CHO, RENE GEORG GEPPERT, RISHABH MEHROTRA, LIAO SHAOSHENG, DAN WANG

Problem Statement

The market manager of Rohm and Haas' (R&H) Metalworking Fluids division is confronted with a poor market performance of R&H's newly introduced product, Kathon MWX. Kathon MWX was introduced in response to a customer request to provide an equally effective solution as R&H's well-established Kathon 886 MW, but targeted to metal working fluid tanks with a capacity less than 1000 gallons. The company launched the product with an extensive marketing campaign for 5 months, but the market results so far are well below the expected sales target of 1,350 boxes in the first year. ((74 [boxes] / 5 [months] = 14.8 [boxes / months]) leads to expected actual box sales in the first year of circa (14.8*12) =177.6.

Initial Analysis

Target customers of Kathon MWX

Self-Service Customers who:

- do self-maintenance

- own very small operations, typically one machine with one small fluid tank

- have very specific maintenance requirement

- are aware of the brands of products and purchase products from dealers

Mid-Size Customers who:

- use maintenance service package provided by dealers/formulators

- own mid-size machines with multiple tanks with less than 1000 gallon capacity

- have a wide maintenance requirement an microorganisms eradication is one of the treatments

- completely depend on the dealers to maintain their fluid tanks and machinery

- are not aware of the brands of the products used in service package

Actual observed customer characteristics

Potential customers are- concerned primarily about reduction of bacteria and odor levels

- demanding a fully-fledged metalworking fluid solution

- sensitive to location of product dealers (mainly small, local tool or supply shops)

- lacking Kathon MWX brand consciousness and loyalty in 50% of the cases

Indication for Marketing Strategy (short-term)

Distribution channel (refer to Appendix for graphical illustration)

1)