In 1942, Soren Chemicals, an industrial-strength cleaning solution company, was founded by Timothy Soren. By 2006, Soren Chemicals had reached a product line of approximately 350 products, with a revenue of about 450 million dollars. The company’s lastest influential brand in the market was Kailan MW, which brought great success to the company over a number of years, however, when launching their latest product, Coracle, which was presumed to greatly impact the market, various faults were made during the launching period, which resulted in Soren Chemical’s expectations to decline.
One pivotal aspect that Soren Chemicals must take into consideration in order to enter the industry is the market size. It is apparent that the main target market …show more content…
Furthermore, it was also evident that the consumers in which Coracle was being marketed to were not knowledgeable about the product, which in turn resulted in the consumers not buying the product. With this, as Coracle is sold to wholesale distributers, there was a higher gross margin, which increased the retail price, despite the fact that it was significantly higher than their competitors. Especially if the company is attempting to target their market, it’s important that their marketing mix is reviewed and developed with relation to the issues that have been …show more content…
From this, we must compare the various prices between the retail costs and the annual average cost that the company has addressed, which is both $50 and $39.06, which has a $10.94 difference, which then is $35.94 for the highest price that can be implemented. With the per treatment at retail prices basis, Soren has approximately $7.77 to increase the price. This calculation was derived from taking $350 (total cost of consumers not using Coracle) and subtracting it from $273.2 (total cost of consumers using Coracle), which equals $77.7, which is then divided by 10 to calculate $7.77. As there are various competitors already in the industry that will be competing against Soren Chemicals, which makes pricing a pivotal aspect to consider. From the information above, having a price ranged around 30-35 dollars seems reasonable. Some constraints of this include the fact that Coracle will need to find a way to market to their consumers that their product is priced better, there will need to be a better evaluation of how the company’s strategies are working, and that Coracle is going to change their pricing again despite the fact that they already are priced over their
One pivotal aspect that Soren Chemicals must take into consideration in order to enter the industry is the market size. It is apparent that the main target market …show more content…
Furthermore, it was also evident that the consumers in which Coracle was being marketed to were not knowledgeable about the product, which in turn resulted in the consumers not buying the product. With this, as Coracle is sold to wholesale distributers, there was a higher gross margin, which increased the retail price, despite the fact that it was significantly higher than their competitors. Especially if the company is attempting to target their market, it’s important that their marketing mix is reviewed and developed with relation to the issues that have been …show more content…
From this, we must compare the various prices between the retail costs and the annual average cost that the company has addressed, which is both $50 and $39.06, which has a $10.94 difference, which then is $35.94 for the highest price that can be implemented. With the per treatment at retail prices basis, Soren has approximately $7.77 to increase the price. This calculation was derived from taking $350 (total cost of consumers not using Coracle) and subtracting it from $273.2 (total cost of consumers using Coracle), which equals $77.7, which is then divided by 10 to calculate $7.77. As there are various competitors already in the industry that will be competing against Soren Chemicals, which makes pricing a pivotal aspect to consider. From the information above, having a price ranged around 30-35 dollars seems reasonable. Some constraints of this include the fact that Coracle will need to find a way to market to their consumers that their product is priced better, there will need to be a better evaluation of how the company’s strategies are working, and that Coracle is going to change their pricing again despite the fact that they already are priced over their