Business to Business Marketing to Management - Assignment Example

Business to Business Marketing to Management Introduction The ability to market to the right market will make a difference in the success of a product and business that is promoting the materials. When looking at the Kunst 1600, it can be seen that there are specific aspects that apply to the vacuum device that will determine the failure or the success of the pump. To ensure the complete success of this pump, there is the need to define exactly how to market the product as well as what segment will respond in a positive manner toward the device. More importantly, there is the need to understand some of the concepts that are centered on the market, including the culture and the needs that are valued with vacuum pumps. Evaluating these various aspects will provide the Kunst 1600 with more opportunities for success within the market. Main Issues of Kunst 1600 The Kunst 1600 was defined as a revolutionary feature for vacuum pumps and can be used with HVAC, refrigeration and other appliances that need pumped and filtered. While the pump is known to create a different response in the market, there are specific issues that will make it more difficult for the pump to become successful with the expectations that are a part of the company. To value and define what is needed with the Kunst 1600 is also the need to understand the specific requirements that are a part of this pump as well as how it will affect the way in which the market responds. The issues of the Kunst 1600 begin with the way that the product was built, specifically which creates misunderstandings within the target market. The pump uses a 1.6 CFM pump, which is only known to be used on refrigeration and smaller appliances. More importantly, the build of the pump is not familiar to most that are in the HVAC industry, which would make it unappealing to those that are in the market. The build of the pump, while offering several revolutionary features, also holds several unknown variables to those that are in the market. Since the CFM is different, it doesn’t use oil and the make is different than others, it becomes a set – back to working into an industry that has standardized requirements for pumps. The second issue that is a part of the Kunst 1600 is based on the external environment and expectations that are within the industry. The Kunst 1600 was built from an engineering stand point, all which was based on providing more efficiency and new technology for HVAC managers. However, those that are in the industry don’t have knowledge, training or understanding of the pumps. More importantly, there is little to no interest in improving the pumps as a main priority, specifically because of the pricing and the easy to implement concepts that are related to this. When looking at the market segments, it could be seen that those who were interested in pumps kept this as a secondary component for maintenance. The mentality surrounding the industry creates a major gap with the technological changes with the Kunst 1600 and what is expected as standards each of the maintenance companies are used to. Being able to work in this gap provides a different challenge to those that are within the industry. Not only are these two elements in the product and the industry considered, but there are also issues relating to the functioning of the Kunst 1600. The vacuum pump sets specific standards and promises to those that are in the industry. However, the engineering hasn’t been met with tests or builds of the product. For instance, in the case study, Evan states that he is not sure about the efficiency of pumping out of AC units as well as how this would respond. Even though the technology guarantees this, there is no practical application of the unit. More importantly, there is a lack of testing with the amount of time that the pump would last as well as its durability. The missing components of the practical application of the pump make it difficult for the Kunst 1600 to find the potential niche market for sales. Price Elements of Kunst 1600 The pricing that is related to Kunst 1600 is one that can help with the promotion of the product and is one of the strengths of the vacuum pump. On average, a maintenance company will spend $150 - $200 on a pump every 2 – 5 years. However, they believe that they make up this money in as little as one job, making the pump a secondary component to the maintenance that is required. For the Kunst 1600, this mentality is an advantage as most don’t consider the need to price the pumps. More importantly, there is not a high end or low end set of pumps that are used for those involved in maintenance. Instead, most are interested in pricing that offers sufficient results and that gets the job done. Even though the Kunst 1600 would be offered at $400 - $500 average, it would provide the same types of savings. For most that stated that the pump lasts for 2 years, they averaged that the cost of the pump was at .05 for every job. Since the Kunst 1600 is expected to last 5 – 6 years and doesn’t have any extra maintenance costs, this gives an advantage to the pump. The higher price will offer savings with the amount of time that it lasts, the expectations with no use of oil and the higher efficiency that can be maintained. The second element of pricing with the Kunst 1600 is based on the savings in oil as well as the extra factors related to the new technology with the pump. For those in the AC industry, the oil is a small factor and only needs to be replaced once a month at an average of $8 - $15. Those in other areas of appliances consider this more of a time factor and a nuisance for the changes that have to be made. Even though the pricing factor isn’t large with the savings in oil, there are still some considerations related to savings. Saving on oil as well as maintenance time both add into smaller costs as well as convenience that the Kunst 1600 can use to its advantage when looking at the overall savings in cost. If looking at the marketing plan correctly, Kunst can evaluate this more closely while adding in additional prices with the make of the pump. Convincing those in maintenance of the overall savings with the life of the Kunst 1600 will help to bring in a larger profit margin while providing more opportunity for cost savings from the pump. Value Elements Not Quantified There are several aspects of the Kunst 1600 that haven’t been referred to when looking at the value of the product and the way that it can change the maintenance of AC and other appliances. However, the case study has not evaluated some of the main ways that this vacuum pump changes from other types of pumps and the ways that maintenance companies can use this to their benefit. If these are further defined, then knowledge, training and various components of the product can be looked into for those in maintenance. This would offer more opportunity for those that are interested in the product in more than one target market. The first value element that is not quantified in the product is based on the ability to alter the environment. The elimination of oil as well as the ability to get the same results with a 1.5 CFM makes a difference in the environmental effects. Even though most in maintenance wouldn’t consider this at first, consumers that are interested in the green movement would be more drawn to receiving service from those who are environmentally aware. For Kunst to weigh this aspect effectively there is the need to tap into the amount of oil that would be saved with the amount of maintenance done by one truck in a period of a year. Multiplying this and showing how it would change the environment for the better would allow maintenance companies to work in a different way. For instance, they would be able to begin advertising their contributions to a green society which would naturally draw in households to the maintenance offered. The second value that is not defined is based on the technology that is used. While Evan used this as his main concept for the Kunst 1600, it is not relayed to those in maintenance. Individuals and companies working on HVAC units are interested in meeting the current standards through the equipment that they have. The component that was created by Kunst breaks out of this because of new technology that is used. However, there is not a definition of the amount of maintenance that this can provide, efficiency that is available and the durability that is looked into by those in maintenance. Running tests on the Kunst 1600 and showing how it is just as effective and stable, even with the new technologies, would help those in maintenance to see that it is efficient for the jobs that they are interested in doing. The third component that is overlooked with the value of the Kunst 1600 is based on the lack of knowledge with the overall make, materials used and the technology that is implied through the maintenance market. There are two components that would need to be defined with the overall product. The first is based on the technology that is used and how this will increase efficiency for a maintenance company. The second is based on the materials that are able to make up the Kunst 1600 and which create more capabilities with the product. For instance, in the market study, there was a response that most didn’t recognize the pump as a main component and would overlook it because of the build and look. However, with the right marketing approach, Kunst can use this to their advantage so they can get the right target market. Building on the unique aspects of the pump, as opposed to trying to fit into the HVAC maintenance companies, could help Kunst to create a different market segment while building a reputation based on innovation of the product. Adding into other concepts, such as using a light weight pump and having materials where there is not a chance of rust or damage, are some of the other elements that could be looked into with the pump. Target Market Segmentation According to the market segmentation that was looked into by Evan at Kunst, the best target market to look into is maintenance companies that focus on refrigeration and lighting for residential areas and for buildings. The culture of maintenance companies is one that meets specific standards with equipment and doesn’t move outside of this. Since there is a lack of education and training, as well as expectations with standards, it will be difficult for Kunst to move outside of refrigeration and lighting. The Kunst 1600 already matches the needs for this industry. This includes the 1.5 CFM that is used, the amount of time that the pump is expected to last and the light weight use that is a part of this. More importantly, the convenience of not having to change oil in the pump is one that will automatically attract those in this maintenance industry as it is a difficult aspect for maintenance, as opposed to other industries. The ability for the Kunst 1600 to fit into the refrigeration and lighting industry is dependent on the factors that match the standards of those that are working in this maintenance area. When comparing the vacuum pump to the standards in this industry, it meets the same value and closeness as the other pumps currently used. At the same time, the Kunst 1600 will show that there is an upgrade which can be used for the pumps. The first pump is based on the ability to save time for those that are working in maintenance, as was seen in the market study conducted. The second aspect will be the advantage of not using oil with the pump, which will save time and money, while making the pump more efficient. If the Kunst 1600 begins to move within this target market first, then there is the ability to expand into other markets. Working with refrigeration and lighting first will begin to build a reputation among maintenance companies so they understand how the Kunst 1600 works as well as how effective it is. From this point, the Kunst 1600 will be able to tap into secondary markets that will assist in growing more revenue for the product over time. After the initial launch has taken place and after the Kunst 1600 begins to build its reputation, then it can move into the HVAC companies. However, to do this effectively, the company will have to offer more information on how the pump works as well as how it can change the standards used for air conditioning. The focus at this point will be on saving time and money while working with more technologically efficient materials for the pump. The target market that will need to be used with HVAC as well as the other companies will need to go directly to those who are overlooking the maintenance of different homes. Owners of the company and managers will need to be the target market within the company. The focus will need to be on saving time and money while providing more efficiency through the technological upgrade. At the same time, the focus will need to be on helping the companies to build a stronger reputation by being environmentally friendly and offering extra valued services to customers because of the type of equipment that is used. Since the individuals in charge of maintenance are in charge of changing oil and getting extra tools, there will also need to be shorter marketing campaigns that are geared around the Kunst 1600 saving time, money and maintenance when working with a machine that doesn’t require oil. Segmenting the companies into two areas will help to add in the amount of knowledge required by the Kunst 1600 while adding value that is a part of the vacuum pump. Customer Value Statement The highest amount of value that is a part of the Kunst 1600 is from the technological changes that are a part of the pump. The technology that is used allows the pump to get stronger results without having to use as much power or maintenance time. Even though there is only 1.5 CFM, the pump is still able to provide efficient results that are matched by the current pumps. This main technological change will alter the amount of maintenance time that is used. More importantly, it will guarantee that the air conditioning, heating and smaller appliances are completely pumped without having any problems that may occur months later from the units that are being cleaned. The ability to change the level of efficiency because of the machine used will help the company to gain a stronger reputation and to meet more demands with customers. The second value that is a part of the Kunst 1600 comes from not using oil as a part of the pump. The value that is added in terms of maintenance is one that saves time and which will help the machine to last for a longer period of time. More importantly, the ability to save money with the lack of oil used can provide those who own a maintenance business with less cost. The efficiency that is a part of this will help to change the work expectations that are used with the pump. The oil is not only a value because of the maintenance changes and the alterations in cost. There is also the ability to add into the environmental awareness that can be used for consumers. While this is not directly related to the target market, the Kunst 1600 can use this to its advantage for those who are interested in the green movement. The third added value that is associated with the Kunst 1600 is based on the efficiency and stability that is a part of the product. Kunst would need to find a way to communicate this to the customer; however, the make and technology used guaranteed high levels of efficiency. The pumps currently in the market were known to burn out, boil off and dehydrate various systems. Specifically, the oil that is used creates more problems for air conditioning and refrigeration because acid would take the place of the oil. The value of the Kunst 1600 would eliminate this and would provide more options for consumers. However, most in charge of this maintenance often disregarded or didn’t know about this part of the pumps. Making sure this was added into the value, combined with the 1.5 CFM providing the same efficiency would help those in the different maintenance areas to have more appeal to the product. Conclusion and Recommendations For the Kunst 1600 to become effective, there needs to be further market studies that go outside of the maintenance customers. Finding out what the consumers that use different maintenance companies require can build a better understanding of what is required for maintenance of heating, air conditioning, refrigeration and lighting. More importantly, this will build awareness with the maintenance companies of what they can do to change their levels of competition from other maintenance units while building their business. By focusing on this first, the Kunst 1600 will be able to relay information such as allowing the units to last longer from the lack of oil, while providing consumers with an environmentally friendly service. The second aspect that Kunst will need to focus on to create a stronger target market is based on training and education of the pump. As was said in one of the studies, those in maintenance want to see that a pump will work so that they will buy it. The Kunst 1600 would need to have a market that was based on the knowledge of how the pump works, why the 1.5 CFM is better and how the pump out values the standards in term of time, money and maintenance savings. There would also need to be evaluations and understanding about how this related specifically to the make and technology of the pump so Kunst could build a higher standard with pumps. The last consideration to make with the Kunst 1600 is built on creating a stronger brand identity with the product. If the Kunst 1600 works first with refrigeration and lighting, then they will be able to build a stronger reputation with companies. The main angle will need to be to help maintenance companies build their reputation because of the equipment that they use. From this, Kunst can work into heating and air conditioning as well as other units. For this to work effectively, Kunst will need to establish themselves strongly within the market. Most who were in the case study noted that they didn’t recognize the name of Kunst and relied on one brand for replacement pumps. Changing this over a period of time could help Kunst to alter the expectations and standards in the market while providing higher technology for the maintenance machines required. The different opportunities available for Kunst are one that is based on the ability to market the products available in the correct manner. Using communication correctly through the maintenance companies and making sure that there are different opportunities available through a primary and secondary market can help with the growth of the Kunst 1600. However, considerations will need to be made first with the changes that the product is offering to those that are in maintenance companies. There will also need to be considerations to the culture and mentality of those in maintenance companies and the expectations that are related to this. By establishing the Kunst 1600 through communication and effective marketing, there will be the ability to offer new innovations to maintenance companies. References Kunst. (2010). Kunst 1600 Case Study. Read More