GROUP 9

Harini Venkateswaran
CLARK MATERIAL 1211021
HANDLING GROUP- Dheeraj Kumar 1211180

OVERSEAS: BRAZILIAN Latngenhun Nongsiej

1211110
PRODUCT STRATEGY (A) Vishnu Charan TJ 1211157
 CLARK EQUIPMENT
COMPANY
Large Highly Integrated Manufacturer of
Capital Goods
Major Group Includes:
1. Axles, Transmission and related products
2. MHG (Material handling group)
3. Construction machinery
4. Other Industries (such as Credit)
Clark Operations were international in scope
35% of operating Profit came from outside the
United States
MAHERIAL HANDLING GROUP(MHG)

Fork Lift Truck were major Product line of

material handling group (MHG)
Margin has improved in 1978 because of :-
1. Economies of Scale (Volume Increase reduce cost)
2. Operational Efficiencies improvement (Exhibit 1)
US was the strongest market, Europe was most
Competitive marketing environment, South America
was flat market
MHGs Distribution Network was good with 237
dealers in 508 locations in 108 countries
 FORK LIFT TRUCKS
Used in heavy Manufacturing and
Warehouse operations
125 numbered Model in lift truck
Differentiated Hybrid product line
HOL (Heart of the line Product):-
4000-6000 pound capacity trucks
which account for about 55% of
sales and build from Clark's MHG
When they start Design product
line they start with HOL product to
reduct the cost.
 BRAZILIAN LIFT TRUCK
MARKET
Brazil rapidly industrializing countries in SA
Growth increased at the expense of Inflation
Changes in the economic policy (Import Duty)
Impact on Clarks business as maximum products
were imported from outside
Used Friction clutch transmission which used to broke
down immediately, bad brand image of Clark and its
distributors. Improved on oil bath transmission but
image with customers undermined.
Major competitors:- Hyster, Eaton-Yale, Madal
Competition on price and Extended product line
Brazilian Market Research Questions

1. Brand Image Check: What was

Clarks brand image with
Customers ?

2. Geographic Need Difference:

Were same factors important
for Brazilian lift truck buyers as
to American Customers?

3. New product Line: Should they

introduce an automatic
transmission lift truck in Brazil?
 Marketing research Company:- The
John Morton Co. Study
Marketing research Firm specialized in
developing Market-Driven Strategic plans.
Founded by Curtis Jones and Richard Johnson
Strategy Recommendations based on market
factors rather than predominantly on cost or
other internal company considerations
Use State-of -the-art mathematical and
computer modeling techniques
 Marketing Research Approach:
Market Driven Strategies Steps
Identifying and defining problems
Analyze market needs, client current role and
of his competitors (Competitive Intelligence)
Formulate Practical marketing and
development strategies and designing criteria
Conduct research to determine the attitude and
opinions of buyers
Recommend Marketing strategies based on
quantitative analysis of market, based on
clients situation and short and long term goals
 Market Research Solution: Factor
Analysis
Factor Level (Field tested)
1. Performance Same, 25% increased, 25% reduced
2. Reliability Same Downtime, 25% more, 25%less
3. Durability Same Life, 25% longer, 25%
Shorter
4. Parts Availability Same, 25% better, 25% worst
5. Transmission Manual with friction clutch, Manual
with oil-bath clutch, Automatic
6. Brand Clark, Hyster, Easton-Yale, Madal
7. Selling Price From $15000 to $20000
 Sampling methods,
Questionnaire
Population Size : 750 firms
Sampled randomly
Sample framing:- Every company needed
to have used HOL product in past five
years or planning to use in next year
191 responses local Portuguese-speaking
Questions were asked on size of fleet,
type of business and percentage of lift
truck companies.
Trade-off Analysis/ Conjoint Analysis
To find out truck factors and factor levels Trade-off
analysis is done by asking questions forces the
respondent to trade-off the level of one factor to obtain
a desired level of other factor
Example :-
Lift truck A Lift Truck B
Oil transmission Automatic transmission
Present Performance 25% better performance
$17000 $17500
55 pairs were presented to each responded
These responses are translated into utilities into each
level of factor by Conjoint analysis method
 THE PROBLEM
David Richards is able to understand the tabulations of
the survey responses better than simulation results. But
Implications of tabulations are obscure. David Richards
has to take decision and recommend what the HOL
product line should be-

1. The Present Model ?

2. JMCs recommended Dual Offering Strategy ?

**This decision is important because if there is any

change in product line a new research and product
development program, and new marketing program will
be required.
Steps of Marketing Simulation Analysis

Utilities were found for each factor at each level

Respondents utility for any particular lift truck was
hypothesized to be the product of his utilities
This overall utility is combined with respondents price
response to get preference
The highest rating would be respondents predicted
purchase
Market share for various models could be simulated by
adding the number of respondents choosing each dividing
by total number of respondent
21 respondent were removed because their inconsistency
in answering trade off questions were unacceptable
Graphical Representations
Utility of different attribute
level..
Utility of different attribute
level..
Demand Function (Utility v/s
Price)
Utility of Lift Truck and Consumer
Preference
Calculation of Market Share

Market Share = (Preference given by users) /

*100
(Total Number of Respondents)
Example:
If No of preference for particular factor level
=30
Total No of respondent = 150
Market Share = 30/150 * 100 = 20%
Project Results By JMC
Recommendation For Clark & David
Richards
Target Hysters market because Hysters was
the largest and more vulnerable to proposed
Clark improvements than Eaton-Yale
Dual Offering strategy is better (Market
share is 36%), increased share 9%
Increase marketing activity generally:
promotion, advertising and selling
Maintain parts availability at present level
but promote it more
Expand the services offered by dealership
Appendix