The Sealed Air corporation is committed to market leadership through technological innovation. Ten years ago, the company was first to market with a highly successful coated air-bubble packaging protection product, AirCap. However, market trends indicate a rapid displacement of coated bubble by a technologically inferior yet inexpensive uncoated product. Burgeoning demand for uncoated bubble poses a direct threat to the long-term viability of the technologically superior, premium priced AirCap.
Thus Sealed Air is situated at a critical standpoint. It can either continue to deal exclusively in the manufacture of high-end coated bubbles emphasizing performance over price, or segment the market by introducing an inferior, inexpensive uncoated bubble. To this end, this report will analyze the industry, competition, and company internal environment to assess the viability of targeting this low-end market segment. A strategic marketing plan for launching an uncoated product will follow.
2.0 SITUATION ANALYSIS
2.1 Industry Analysis ---state growing market.
The protective packaging industry can be segmented three ways by use: positioning, block, and bracing; flexible wraps; and void fill. Coated (e.g., AirCap) and uncoated air bubble products serve the flexible wrap and void fill markets (refer to Glossary). The flexible wrap market, which dwarfs void fill as measured by annual sales, is of primary concern to Sealed Air and will thus constitute the focus of this report.
Protective packaging is sold to organizational customers through select distributor networks via personal selling. Sales commissions for AirCap are set at 2%. Often, manufacturers must have a regional presence to be successfu...
... middle of paper ...
... at 4% net to reflect its lower retail price. This will provide commissions equal to AirCap.
In particular, promotions should target consumer who use paper-products and foams. Leveraging the company's highly trained sales personnel, relative benefits and long-term cost savings afforded by superior bubble product should be stressed. Additional promotional efforts should include direct mailings to potential clients in the US and Europe. Importantly, all promotional efforts must target packaging engineers.
The apparent market trends cannot be ignored. Sealed Air must enter the uncoated market to maintain its leadership position. Using a frontal attack, it can achieve its objective and minimize associated issues by differentiating its product, leveraging its international ties, undercutting prices, and improving its promotional efforts.
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