Analysis Whirlpool GreenKitchen: Inovation Development and Marketing Strategy - Case Study Example

Development and Market Strategy (Whirlpool Kitchen) Company differentiation The case of Whirlpool Kitchen has provided a very comprehensive scenario on how the company’s approach to green market is. Green market is becoming a major issue in the contemporary given the world trends with regard to environmental changes in particular the emissions of carbon materials to the atmosphere. Different companies are using different approaches to green market and which they consider can give them a competitive advantage in the very competitive global market (Mesdag 2000). Given the case of Whirlpool Kitchen and its intention to be responsible to the environment in which its operating in, it is very evident that there are various approaches that the company can apply in order to remain at top of competition with regard to issues related to green market. 1. First and foremost, the Whirlpool Kitchen employs the concept of science and technology which will be able to tackle various issues which are related to developing different alternatives of sources of energy which may include the use of wind and geothermal as well as solar energy. On the same line, with science and technology c an be used different appliances that can use different sources of energy as many customers are becoming worry of the kind of products they are using at their homes and their impact to the environment. 2. Further, the competitive advantage of Whirlpool with regard to green market can also be enhanced through what can be termed as designing its buildings and other architectures in such a way that they support less environmental pollution, use of most renewable sources of energy and also protecting various natural materials on earth which are very important and include water and air. By conceiving to develop the most environmental friendly buildings and structures, is particularly important in ensuring that all areas of the business are not passive in green market by contributing positively to the energy efficient plans. 3. Paying attention on how the company appliances could be used by the market to ensure health foods is produced. This is especially important after it has emerged that customers are becoming aware of what packaging of different products entails, the process of minimizing carbon emissions and also promoting organic production. This to some point may require the company to improve on its policies so as to ensure eco-stores for the company are established as is the case of Tesco Company which has managed to invest heavily on establishing eco-stores. 4. Finally, the issue of competitive advantage for Whirlpool Kitchen with regard to green market can be enhanced if the fashion of product appliances is addressed and this can be tackled from the point of ecological and social as well as ethical issues throughout the production process. The aspects that are important and that can be tackled add value to the green market include integration of different labor practices and production and participating in solving different global environmental issues as this will put the company on the global map on issues related to green market. The theory of Routes to Competitive advantage is important is showing how any given business can design its road to attaining competitive advantage with regard to GreenKitchen concept. This is because it seeks as shown in diagram 1 below to show the flow of different aspects that have to be tacked and that can have direct impact to the competitive advantage of the business and which include cost, focus and differentiation. First and foremost thing to do in the route to competitive advantage and that can fit the case of Whirlpool Kitchen is to remain focused and this can be explains in terms of what the company wants to achieve in relation to world environmental welfare. The idea of global environmental welfare and sustainable development has a very long history even though it has come to receive much support during the start of the 21st century. For the company this means is that the business will have to remain alert and try to find what kind of appliances are most appropriate for the market and the company offer the best as one way of differentiating itself from the rest of the competitors (Mesdag M 2000). However, the aspect of cost needs to be taken into account so as to determine the company’s sustainability to environmental welfare initiatives. Diagram 1: Routes to competitive advantage The company strategies, mission and vision statements have provided a very strong ground for the competitive positioning since they have given much emphasis to issues related to innovation, eco-friendly and consumer service. One such aspect that has been very distinct in the case of Whirlpool and that has given the company the competitive position now, is the consumer-driven strategy that its using to dominate the market and which pays more attention to such issues as introducing more innovative products to the market, enhancing the customers’ confidence about the company and expanded brand presences in various markets (Mesdag 2000). This has greatly helped the company maximize its benefits since resources worldwide are effectively used, costs of production reduced and processes qualities enhanced. Innovation for instance, has helped the company to generate revenues amounting to $2.5 billion globally. This is a very positive result from the company it indicates how the strategy of innovation is not important in attaining sustainable competitive advantage but also how it’s important in penetrating different markets and in the process helping the customers to get the best of the company products. The company competitive position is also based on the strong corporate social responsibility (CSR) policy which can be traced back to after World War 11 when the company founders Upton brothers chose to invest in different local NGOs that working towards improving the living standards of the community members. For instance, the company has managed to mobilize funds for various projects such as fighting breast cancer, education for 15,000 business women and provision of 90,000 appliances for free to the community. Further, the company’s role in environmental issues has been so significant something that has continued to impact on the company’s daily business. This is especially managed to reduce it water and energy consumption by 60% and 30% respectively since 2000. Unlike many other companies, this approach has helped the company to be ahead of the other companies in the industry because of the reputation that it has developed in the public. On the other hand, the Electrolux which is the leader in the industry of manufacturing and marketing household appliances has placed much of its emphasis on the company overall sales. Like is the case of Whirlpool Kitchen, Electrolux has very wide coverage in the markets with 49% share of the European market. Further, the company has continued to perform extraordinary good in issues related to environment after it had introduced range of energy-efficient house appliances, cutting energy consumption in its factories and finally, being in the forefront in campaigning on the need to embrace and use eco-friendly products. This key position can be used to define Whirlpool Kitchen as a market challenger for Electrolux because of its advanced approaches to developing and using eco-friendly appliances. 1) Company target market group The company target market can be classified into three major groups. The first target market entails those individuals that are involved in green movements and that can be divided into four significant categories namely: dark greens that exist in between middle and upper-class individuals that strongly feel responsible about the environment and strong sense to the community and also personal pride. The other category of those involved in the green movement is the medium greens that comprise young and affluent parents that are ready to protect the environment for their children. Emerging middle class on the other hand are urban dwellers, young and very sensitive to prices and who have come to embrace eco-friendly practices because of their status. Finally, the last category in the green movement is the non-greens who mainly focus on survival in order to support their quest for attaining stability and security. In general, this kind of target market is wide and needs diversity of appliances that can meet status needs, easy and eco-friendly products, eco-friendly but price friendly products and best products for price. The other major target market for Whirlpool Kitchen is the green consumers and this is a group that is dominated by eco-related interests and can be classified into three major groups namely the “Planet Passionates” and who are real very cautious in protecting wildlife and also keeping the planet clean. What can be offered for this target market segment are easily packaged products and easily recyclable bottles and cans. In the same target market is also “Health Fanatics” who are only focused on health consequences and that can be satisfied by products that are less toxic and have very minimum defects. Finally, the “Animal Lovers” fall in the category and are those individuals that want to protect animal rights and the products can serve them better are likely to be those that are less harmful to fauna and flora. Finally, the last target market for the company is the green consumers and this is a group that can be identified by its lifestyle. Further, there is also that group of individuals that do not embrace new technology and could prefer to buy simple products for the local market. With this target market only what is required to satisfy is simple designed but eco-oriented appliances. The diffusion theory provides for an important in trying to analyzing demographic and psychographic customer profiles in innovation development and marketing strategy. According to the theory off diffusion, innovation is only likely to be viable if it’s adopted and accepted by the community members. In the case, it is provided that gender and age are the common forces that influence the acceptance of certain products (Golder 2000) On the other hand, external motivations and attitudes of the target market became very instrumental in helping the role of technology and innovation and the benefits that will accrue by using the household appliances by the consumer. At the same time, the Ansoff Matrix provides for an important which among market penetration, market development, product development and diversification could be the best strategy for growth by the company. However, since there are different demographics and psychographics, it is most likely that diversification is the best strategy for the company. 2) Recommendations for Whirlpool GreenKitchen In the future, it is recommended that the competitive advantage of the business be would be diversify its appliances base accompanied by high quality so that consumers could be encouraged to buy just from one point. This is important if customer preferences are taken into account and such aspect as ease of use, space occupying, and durability as well as reliability taken into consideration so as to ensure high level customer satisfaction (Mohrman et al 2001). Since the company’s future do not look so optimistic since the decline in demand for appliances in the European market since 2009, it is therefore advisable that to overcome the prevailing difficulties in the market, the core strategy for the company has been to embark on partnership with different retailers with the aim of boosting the company loyalty and revenues. Diagram 2: Strategic Customer Equity Management As revealed in the company, different target markets are defined by different factors and their needs need to be addressed different and this call for use of a given market strategy could satisfy the company consumers and at the same facility to process of implementing the company strategy (Waheeduzzaman 2004). In the strategic customer equity management, such aspects as brand equity, value equity and relationship equity are addressed and they form important of the company marketing mix as shown in the diagram above. Price: Use Pricing & Value Equity Implications Theory. In pricing, the company prices for appliances will be set to reflect the quality in the appliances and the convenience and in overall the value attained by the customer and company. Place: Use Channels of Distribution Different distribution channels would be used by the company. This is to ensure that the company appliances are delivered to the market for customer convenience. Promotion: public relation Different media will be used to promote the company products. However, what will be considered here is that the target market is reached and at the same ensures the promotion tool used is green. The ultimate objective is to enhance relationship with the customer and build brand loyalty through enhanced public relations. Product The most important aspect that will be looked in the product development is the features that the consumer wants. The appliances will in particular take into account issues related to eco-friendly that as discussed in the company. Further, functionality and ease to use the product will be used in the product developed. 3) Evaluation of the launch of Whirlpool eco-kitchen According to the diffusion as depicted in the curve below, individuals who have been exposed to innovation will adopt innovation earlier as opposed to those that have not been predisposed. According to the diffusion curve, Individual Innovativeness and the percentages of potential innovative adapters are theorized to fall towards each category. According to the bell-shaped curve provided below, on the extreme of right are the innovators and who are ready to take on the risk and can be termed to pioneers especially to adopt a certain innovation as opposed to those to the extreme end who are not ready to take any risk to adopt innovation. In summary, the idea about the product will emerge, conceptualized by the innovators and start adopting in a way that it meets the market demand and company expectations in terms of revenue and market growth (Waheeduzzaman 2004). Diagram 3: Diffusion of innovation Future implementation plan Diagram 4: Strategic focus References Golder, P 2000, Insights from senior executives about innovation in international markets. Journal of Product Innovation Management. vol. 17, no. 5 (Sept), 326-340. Mesdag, M 2000, Culture-sensitive adaptation or global standardization - the duration-of- usage hypothesis. International Marketing Review, vol. 17, no. 1, p. 74 Moenaert, R and Wauters, E 2000, Communication flows in international product innovation teams.  Journal of Product Innovation Management, Vol. 17, No. 5 (Sept), 360-377. Mohrman, S., Klein, J and Finegold, D 2001, Managing the Global Knowledge-Creation Network: A Sense-Making Perspective. MIT Engineering Systems Division Working Paper Series, prepared for Seminar on Virtual Teams, USC. Waheeduzzaman, A 2004, Trends and Development in Standardization Adaptation Research. Journal of Global Marketing, Vol. 17, no. 4, p. 23, 30 Read More