Zoecon Case Study

Which market to Strike ROACH ENDER

Zoecon Corporation produces chemical insecticide toxins to control insect populations. They have developed a breakthrough product, which stops pest development and is less toxic to environment called Hydroprene. They have a premium quality product, which not only kills insects immediately a but also stops them from reproducing for the long run. The company would like to determine the best marketing program for its new product Strike Roach Killer. Their options are expand to 19 cities in the consumer market, pursue the professional pest control market or sell their compound to other companies in the consumer insecticide market.

The market is divided into two main segments. The consumer market and the professional pest control market. There is also the alternative segment of national brand name insecticide companies. The distinction between segments is based on distribution systems and product forms.

This is a growing market, which is highly competitive. The consumer market is controlled by three main companies S.C. Johnson, Boyle-Midway, and d-con. Together these three companies have 67% of the market share. The consumer market is highly promoted, seasonal, varies by geography and has insect specific insecticides. Products are sold to consumers at supermarkets, drugstores and other locations. Distributors sell the professional market. The product comes in different forms for different effects such as quick kill, residual control and margin safety.

The company had a teat market of four locations. These locations were chosen because they were considered representative of the 19-city market where 80% of insecticides are sold. The test market had two objectives determine consumer acceptance and qualify the trade and consumer marketing program. The test market was successful in gaining recognition form 57% of the market but unfortunately it was unprofitable with a $1,278,788 loss (Exhibit 2) and a low market share of .124%...