Teen Furniture Line Case Analysis

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Children First Ltd. – Teen Furniture Line

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1. What are the likely reasons for the failure of the new teen line?

Before we start analyzing possible reasons for the failure of the new teen line, we would like to begin with the success of the original line. First and foremost, it serves the target customers looking for child-safe coordinated furniture made of full wood. This in inline with customers’ requirements: high quality, good safety records, and comparatively low prices when compared with import furniture. Even thought they were priced 50% above other locally made products, they were cheaper than imported furniture. Secondly, CFL received good support from the dealers. Having CFL’s original line in their showroom, they now make the choices available for the customers thus increase their overall value proposition.

By introducing the teen line, even though CFL still relied heavily on their key capabilities of producing high quality and stylish furniture, the two product lines offer different concept. The new teen line offers differentiation with life-long furniture that “grows with you”. Pricing strategy is also different. The teen line is priced at 25% premium while the original line is priced 50% above the locally made furniture. In addition, CFL also offers customers 10-year guarantee on all furniture from their teen line. By going to the new market segment (teenagers), CFL have overlooked many critical factors in launch of their teen line. The target group is too heterogeneous covering both children and teenagers from age 7 – 18. The target group expected benefits are varied and thus we cannot cater to everybody’s need with CFL’s average product. What a 7-year-old girl’s want is far different from those of an 18-year old girl. Even though the decision makers in this segment are still the parents, children and teenagers have strong influence...