Case Analysis Of KONE

1372 Words 6 Pages
Register to read the introduction… Approach 2: KONE should position Monospace above the gear traction products, market its distinctive features with high-end price and keep the hydraulic as their low-end model. Since there was less demand for new elevator installation, KONE should focus on profits and not on market share generated from following low cost strategy. Monospace fit price and performance wise relative to other products
Pricing
 Monospace was priced in line with equivalent and more expensive geared traction elevators
 Monospace be priced above existing prices if KONE held less than 15% market share and in line with existing price levels if KONE otherwise
 A significant portion of the savings of not building a machine room would accrue to either the owner or construction company motivating them to specify the Monospace
 In France cost was FF55,000 per year less than that of a comparable elevator (repaying a premium of FF 30000 in 6 years
 In UK was dictated primarily by the 15000 pound TF which put it near the PT price
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Key weaknesses in KONE’s current capabilities
• The current Brand of KONE is not at the same level when compared to already settle bigger brands such as Schindler, Otis, Thyssen present in Germany. Therefore, KONE will have to conduct a lot of marketing activities such as Product launch, advertising etc. in order to fully demonstrate its current capabilities to the prospective buyers.

• KONE will have to work with its current network of salespeople in order to convince the purchase decisions makers (general contractor and architects) to enclose deals. Currently, the salesperson’s strength that KONE has for KONE AUFZUG, which operates in Germany, is much lower and outnumbered by four or five to one by other big firms such as Thyssen, Otis, and Schindler. Therefore, in order to effectively mange its selling team in Germany with lesser number of employees, KONE current capabilities will play a major role.

• Property owners’ fear of a monopoly : As the machine-room-less elevator was a revolutionary technology started by Kone, property owners felt they could be left with very little bargaining power as there was no other competitor offering this technology. Convincing prospective customers on this front is a potential

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