Zoecon Case Analysis

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ZOECON CASE ANALYSIS Intro We must analyze the market and each the two main segments, as well as reflect on our test marketing of our product “Strike: ROACH ENDER” before making any rash decisions on whether or not to expand the product from a 4 city test market to 19 cities, and eventually going national. Market-Segments Currently, there are two main segments within the Premise Insecticide Market, the “Consumer” segment and the “Professional Pest Control” segment. Consumer Segment The consumer segment of the market accounted for an estimated $400 million in annual sales in 1985, with a forecasted growth rate of 10% annually through 1990. Market shares broken down by company and products for this segment can be found by referring to table 1 below: Company Product/Brand Market Share S.C. Johnson & Son Raid Brand 45% Boyle-Midway Division of American Home Products Black Flag 12% d-Con Company N/A 10% All Other Companies N/A 8% or less Table Distribution channels within the consumer segment are dominated by supermarkets, which accounted for roughly 70% of insecticide sales, followed by other retailers such as home improvement centers and house and garden outlets at roughly 21%, and drug stores account for roughly 9%. The products offered in this segment come in various forms, as summarized in table 2 below. Table Form of Products Offered Percentage of retail sales Aerosol sprays 74% Liquid sprays 14% Solids, Strips, pastes, traps, and baits 12% The difference in packaging for these products, however, reflected the consumer’s preferences. For example, they want a “quick kill” (a mindset that dominated the market, thus the aerosol sprays high market share), a product with residual control, and a product that provides a solid margin of safety. This consumer segment was also subdivided into
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