REVIEW QUESTION
SESSION: Fundamentals of Business Strategy
The notes below are from interviews with the Ontario Monuments Builders Association regarding marketing problems in that industry.
Jim Slate, President of Slate Bros., a supplier of monuments and tombstones, was attending a reception at the Annual Meeting of the Ontario Monument Builders Association. Slate Bros. sold tombstones and monuments through selling arrangements with funeral parlors.
During an interview, Slate commented that "It's tough selling premium priced products like ours these days. In the old says, each parlor carried only one brand of monument. People buying monuments were not price-sensitive: rather, they equated the price they'd be willing to pay with their emotional attachment to, and respect for, the deceased. Buyers believed that quality and price went hand-in-hand. The only question was how much they could afford."
Nowadays, it's different. Some people are planning their own funerals and, possibly out of modesty, they are instructing their estates to conserve resources. Some are even doing their own shopping and expect the funeral parlors to carry monuments from more than one supplier. Worse yet, whether the purchase is for themselves or others, the majority of buyers seem to feel that all they need is an ‘average sized tombstone' at the lowest price. Size, durability, detail work and other subtle aesthetics like uniformity of color just don't seem to be appreciated" As for the parlors, they really don't understand selling: they're use to be being basic order-takers and don't seem able or willing to get customers to trade-up".
a. Assuming that people today are no less attached to their loved ones than they were in earlier times, what does the consumers' new-found focus on lower prices imply about how suppliers have marketed their product (i.e. what sorts of things haven't suppliers been doing)?
b. What sorts of things could Slate do if he wishes to successfully offer a premium priced product? Be certain to comment both on the nature of the product offering and the supporting infrastructure. (- one page typed, double-spaced not including exhibits)
c. What sorts of things might Slate consider doing if he discovers that he cannot do the things required to support a premium price? Be certain to comment both on the nature of the product offering and the supporting infrastructure. (- one page typed, double-spaced not including exhibits)
d. What should Slate do? If your answer is "it depends...", tell me what it depends upon by listing the five MAJOR things you would like to know. You should provide a short (as in one sentence defense) for how each item of information will assist you in making the decision. Please be specific (i.e avoid generalities like "will people buy it?") - no page limit but brevity appreciated