Xtravacum175 Essay

4407 Words Mar 16th, 2014 18 Pages
The Xtra Vacum 175

May 2007

The Xtra Vacum 175
J. White, a senior product manager at XtraVacum, was excited as he lifted the prototype of a dry piston vacuum pump out of its shipping carton. Management of XtraVacum's new parent company, KPO GmbH, had decided to test its ability to penetrate new market segments within the United States (U.S.). Whereas KPO marketed the 125 under its own name as a platform product to the scientific laboratory and health care segments, XtraVacum would sell it as a derivative product in previously untapped application segments. The division’s vice president, L. Will, had named White to head up a team charged with finding new segments for and then commercializing the 125. White looked forward to the
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First, White had to identify and target high potential market segment(s). He planned to do so by determining in which segment(s) the Xtra Vacum 175 stood to deliver the greatest value. White speculated that the residential air-conditioning (AC) repair segment would offer the best opportunity. Second, White had to develop a value proposition for the Xtra Vacum 175 for each segment targeted. At this point, he wasn’t sure whether to stress the fact that the pump did not require oil changes or that it had a projected lifetime of 6 years.

BACKGROUND
Based in Minneapolis, XtraVacum is the recently acquired U.S. Division of KPO GmbH. During the previous fiscal year, XtraVacum sales soared to a 75-year record of $120 million. The firm manufactures top-end (i.e., 6 or more CFM) vacuum pumps for use in highly demanding laboratory, health care, and industrial applications. For example, in the lab, engineers rely on XtraVacum pumps in freeze-drying, vacuum oven, and distillation processes. In high tech industries, operations personnel employ XtraVacum pumps in the production of cathode ray tubes and computer chips. From a technical standpoint, XtraVacum pumps provide a “deeper draw” (i.e., they can evacuate chambers down to almost a perfect vacuum) and are more efficient at lower pressure levels than competing models. Scientists, engineers, and health care professionals highly regard the XtraVacum brand name. Not surprisingly, XtraVacum holds a 60% market share in

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