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    Eco7: Launching A New Motor Oil Case Study Solution

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    Rahul Agarwal
    Avellin holds an 11% market share in the US PCMO market as of 2011, ranking third. However, its market share has declined since 2000. Avellin has the strongest position among DIFM consumers, generating 68% of its revenue from independents in this segment. The main marketing opportunity for Avellin is penetrating the DIY consumer segment, which it has previously ignored. Avellin's test marketing of its new Eco7 product showed customers demanding a lower price, but high production costs required a higher price. As a result, Avellin decided to sell Eco7 exclusively through independent repair shops or Avellin-owned auto stores.

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    Eco7: Launching A New Motor Oil Case Study Solution

    Uploaded by

    Rahul Agarwal
    806 views2 pages
    Avellin holds an 11% market share in the US PCMO market as of 2011, ranking third. However, its market share has declined since 2000. Avellin has the strongest position among DIFM consumers, generating 68% of its revenue from independents in this segment. The main marketing opportunity for Avellin is penetrating the DIY consumer segment, which it has previously ignored. Avellin's test marketing of its new Eco7 product showed customers demanding a lower price, but high production costs required a higher price. As a result, Avellin decided to sell Eco7 exclusively through independent repair shops or Avellin-owned auto stores.

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    market position for ECO7

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    Market position for ECO7

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    Avellin holds an 11% market share in the US PCMO market as of 2011, ranking third. However, its market share has declined since 2000. Avellin has the strongest position among DIFM consumers, generating 68% of its revenue from independents in this segment. The main marketing opportunity for Avellin is penetrating the DIY consumer segment, which it has previously ignored. Avellin's test marketing of its new Eco7 product showed customers demanding a lower price, but high production costs required a higher price. As a result, Avellin decided to sell Eco7 exclusively through independent repair shops or Avellin-owned auto stores.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    806 views2 pages

    Eco7: Launching A New Motor Oil Case Study Solution

    Uploaded by

    Rahul Agarwal
    Avellin holds an 11% market share in the US PCMO market as of 2011, ranking third. However, its market share has declined since 2000. Avellin has the strongest position among DIFM consumers, generating 68% of its revenue from independents in this segment. The main marketing opportunity for Avellin is penetrating the DIY consumer segment, which it has previously ignored. Avellin's test marketing of its new Eco7 product showed customers demanding a lower price, but high production costs required a higher price. As a result, Avellin decided to sell Eco7 exclusively through independent repair shops or Avellin-owned auto stores.

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    Eco7: Launching a New Motor Oil Case Study Solution

    Question
    Assess Avellin’s market position in the PCMO industry.  What is the main
    marketing issue/marketing opportunity facing Avellin?  What evidence
    (indicators and data from the case) supports your response, and that
    would impact Avellin marketing decision? 
    Answer
    Market Position
    Avellin holds 11% of market share in 2011, ranking third in purchasing cars
    motor oil in the United States. However, the market share has declined since
    2000, as in 2001 company’s market share was 14%. On the other hand, Avellin
    had the strongest position for DIFM (Do-It-For-Me) consumers.
    Avellin has always focused on being the preferred brand in DIFM since its
    initiation, as it’s easy for independent customers to switch their brands.
    Therefore, Avellin has always worked hard to facilitate its customers with best
    services and pricing strategy. As a result, Avellin generated most of its revenue
    that is 68% of its sales from independent DIFM consumers.
    Marketing issues/opportunities
    Marketing Issues:

     High cost
     Ignorance of DIY segment
     Market penetration based on price, which is relatively higher.

    Marketing Opportunities:

     Less energy requirement


     Longer and higher performance of recycled items
     Product Combination of environmental freely and supreme performance
     Effectiveness of slogan
     Competitive advantage over SevoGreen of Sevoline.

    Avellin’s marketing decision


    The test marketing of new product eco7 has left the company with a decision of
    projecting their penetration on a pricing basis. The customers were demanding
    lesser price, but due to high cost, the high price needs to be charged. Therefore,
    the company decided to offer selling rights exclusively. In doing so, the company
    planned to sell either to independent DIFM stores or at Avellin Auto Store

    Question:
    The PMCO market consists of two broad consumer segments, five types of
    service providers, and a network of channel partners.  About 84% of Avellin’s
    current revenue comes from three customer types.  What is Avellin’svalue
    proposition for each of these three customer types (1-2 sentences each)?
    Answer :
    The value proposition for each of the three customer types on which Avellin had
    been gaining revenues are from:

     Independent DIFM: Avellin was one of the leading firmsamong the independent


    DIFM customers due to its Aventage The Aventage Program consists of dedicated
    sales manager, providing customers with the information on the oil changes,
    discounts and also providing Avellin on customer buying behavior and trends.
     National Retailers: Avellin used the DIY strategy by placing its oil on thebottle
    and sold it to customers through national retailers such as warehouse clubs, auto
    parts, merchandisers and the super markets such as Wal-Mart. The new product
    Eco7 was packed in a green bottle to show it as eco-friendly and were placed in
    attractive shelves to catch the attention of customers.
     AvellinAuto:AvellinAuto are the auto shops owned by Avellinwhere it provides
    fast lube, oil changes, and repairs. The reasons that Avellin decided to open its auto
    shops is to target and gain more customers and create brand awareness in the
    PCMO market.

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