Cutco

Case Analysis Cutco

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CUTCO is a purveyor of fine cutlery established in 1949. CUTCO sales relies on it sales subsidiary of Vector. Vector is divided into six different geographical areas across the United States and Canada. These six regions are combined into two companies Vector East and Vector West.

CUTCO products are marketed through a dual distribution system through the use of its internet website www.Cutco.com for its current customer base and also uses a subsidiary direct sales force through Vector Marketing to attract new customers. The Cutco.com site allows consumers to navigate through its catalogs of different cutlery products using an appealing graphical interface along with video demonstrations of the quality of its products. If you are a previous Cutco customer then you have the ability to purchase new products through its online catalogs. However if you are a new customer then you have to schedule with Vector for one of their sales representatives to either come to your home or schedule an online demonstration. Recently Vector has begun to utilize booths at fairs and expositions to demonstrate the quality of their products and allow purchases onsite.

Vector Marketing represents the direct selling marketing channel. Vector relies on university aged personnel to market and sale their products. Vector believes that this demographic allows them to attract an educated well groomed employee that needs a more flexible schedule. Vector pays through commissions on the products that are sold as well as any in home visit as Vector believes the quality of the merchandise presented will warrant a sale anyhow.

As mentioned previously Cutco.com is a website offering a full catalog of products along with the demonstrated use of such products. The website does not allow sales to new customers only to existing customers. The channel conflict comes in where demand for increased access to its website cuts into the potential sales of the Vector...