Loctite Corporation
Executive Summary
Loctite Corporation should introduce the new adhesive system Bond – A – Matic 2000 (BAM) as complementary product to the SuperBonder adhesive line. The target customers are plant managers in companies using more than 1 lbs. of instant adhesive per year. Loctite should employ a direct mailing campaign for BAM’s marketing efforts. The new adhesive system will support the company’s strategies to capture 35% of the CA market with the SuperBonder line.
Customer Analysis 1. Market Potential Analysis
Based on the numbers for 1978, the market for cyanoacrylates totaled to 890,000 pounds sold between industrial and consumer market. Using the forecasts for 1979 for the industrial market (335,000 lbs.), I calculated an implied a growth rate (CAGR) of 26%, for pounds of CA’s sold (Exhibit 1). The growth in the market for CA’s is supported by the findings of the 1977 survey for the CA buyer behavior; 26% percent of current users expected to increase their use of instant adhesives. Probable increase in the market for CAs is driven by current users as well as potential clients. In Exhibit 2, using the Number of Establishments and Additional % of Potential User Establishments, I computed Potential Establishments NEW users of CAs for SICs 20-39 (SIC’s 20-39 were used for this analysis based on Loctite’s stated goals); using the 35% Loctite market share goal I, finally, calculated Potential Loctite Market Share of NEW Establishments users. Because Loctite has a stated goal to preserve sales of Quick Set 404 to current customers and use the Superbonder line to capture new clients, Potential Loctite Market Share of NEW Establishments users numbers represent o good indication for market potential analysis for the SuperBonder line.
Note: Market Potential Analysis for Bond – A – Matic 2000 (BAM) will continue after Customer Segmentation and Target Market Selection Analysis. 2. Customer Segmentation
To analyze which customer segment needs would be best
Loctite Corporation should introduce the new adhesive system Bond – A – Matic 2000 (BAM) as complementary product to the SuperBonder adhesive line. The target customers are plant managers in companies using more than 1 lbs. of instant adhesive per year. Loctite should employ a direct mailing campaign for BAM’s marketing efforts. The new adhesive system will support the company’s strategies to capture 35% of the CA market with the SuperBonder line.
Customer Analysis 1. Market Potential Analysis
Based on the numbers for 1978, the market for cyanoacrylates totaled to 890,000 pounds sold between industrial and consumer market. Using the forecasts for 1979 for the industrial market (335,000 lbs.), I calculated an implied a growth rate (CAGR) of 26%, for pounds of CA’s sold (Exhibit 1). The growth in the market for CA’s is supported by the findings of the 1977 survey for the CA buyer behavior; 26% percent of current users expected to increase their use of instant adhesives. Probable increase in the market for CAs is driven by current users as well as potential clients. In Exhibit 2, using the Number of Establishments and Additional % of Potential User Establishments, I computed Potential Establishments NEW users of CAs for SICs 20-39 (SIC’s 20-39 were used for this analysis based on Loctite’s stated goals); using the 35% Loctite market share goal I, finally, calculated Potential Loctite Market Share of NEW Establishments users. Because Loctite has a stated goal to preserve sales of Quick Set 404 to current customers and use the Superbonder line to capture new clients, Potential Loctite Market Share of NEW Establishments users numbers represent o good indication for market potential analysis for the SuperBonder line.
Note: Market Potential Analysis for Bond – A – Matic 2000 (BAM) will continue after Customer Segmentation and Target Market Selection Analysis. 2. Customer Segmentation
To analyze which customer segment needs would be best