Berita Products Company Hbs Case Summary

HBS – The Brita Products Company

Brita saw early success due to several factors. The first was due to the inherent product feature of the system that suggested that it would have extremely high customer lifetime value. For each pitcher sale would start a flow of filter sales. The pitcher was sold with a single filter in place and the filters would require to be replaced every two months or so.

Another major factor can be attributed to one relating to ‘Context’. Over the the decade of the 1990s, the safety of tap water became a major topic of growing concern to US households. The US Environmental Protection agency declared that about 10% of the sediment under US surface waters was contaminated, enough to potentially pose a threat to human life. As such the need for clean water became heightened amongst American consumers. And instead of buying bottles of water all the time, consumers were on the hunt for something more practical, this is where Brita and its system came into play. As such, eventually Brita managed to create a home water purification industry worth $350million at retail, and held a 70% revenue share.

What was interesting was the decision from management to position Britas system on grounds that emphasized the taste benefit. After the product was well known enough and people knew how it worked, the management focused on positioning it on the basis of taste. A water purifier that emphasizes taste? Sounds strange. The rationale for this was that aside from benefiting from a ‘health benefits’ halo it would be a differentiating factor that would be harder to compete with. If they said for instance that they could remove 93% of lead, competitors could claim a 95% removal. As such they decided to be first movers on claiming this benefit and did so in a loud and proud fashion.

However, as expected – consumers came in droves. Some were more expensive, some much cheaper. A lot of the competitors took health and safety positions to counter balance Britas...