Aqualisa Quartz:

Simply a Better Shower

Case Analysis

Aqualisa Quartz: Simply a Better Shower

Case Analysis

1. Introduction
Aqualisa is a UK shower manufacturer. The showers in the UK were facing two main problems:
low pressure and frequent fluctuations in temperature. Aqualisa focused on innovation and
invested 5.8m GBP to develop a breakthrough product, which was called Quartz. Although
Quartz is technologically far better than existing products in terms of water pressure, ease of
installation, use and design for some reason, it wasnt selling

2. Market Analysis
The analysis of the shower market and the position of Aqualisa in that market will be done
through the three steps creating value, capturing value and sustaining value. That is the way to
achieve sustainable profits.
2.1 Creating value
The analysis about the creation of value goes hand in hand with the analysis of the 4 Ccustomer, company, competitor and collaborator. The result of that analysis tells us more about
the marketing strategy and how a company is positioned what are the target customers and
what is the value proposition. The value proposition itself is then the perceived benefit minus
the perceived costs (as perceived by the customer).
2.1.1 Customers
Shower buyers in the UK tend to fall into one of three pricing segments: premium, standard and
value. Premium segment clients typically shopped in showrooms. They take for granted high
performance and service. Standard segment clients tend to emphasize performance and
service. They usually rely on independent plumber recommendations. Value segment clients
are primarily concerned with convenience and price. They like to avoid excavations and also
tend to rely on independent plumber to select a product. In addition, there is a sizeable do-ityourself (DIY) market in the UK. Clients generally buy in large retail outlets that deliver the
product to them. They are primarily interested in inexpensive models that are easy to install.
Furthermore there is a significant property developer market in the UK. Most developers dont
have to care about pressure problems (new buildings) but about other issues. They prefer
reliable, nice-looking products which work in multiple settings. They are very price-sensitive.
In general, consumer wanted a shower that looked great, delivered good pressure at stable
temperatures, was easy to use and didnt break down.
2.1.2 Company
Aqualisa is a UK shower manufacturer which is characterised by a strong reputation and was
generally recognized as having top quality showers, a premium brand and great service. The
company is serving many different client segments which have been explained before.
2.1.3 Competitors
Aqualisas market share ranks it number two in mixing valves and number three in the UK
shower market. Exhibit 2 in the case shows that Aqualisa (including the brand Gainsborough)
sold 325500 showers in the year 2000 and was ranked third behind Triton (545500 showers)

Aqualisa Quartz: Simply a Better Shower

Case Analysis

and Mira (390000 showers). Although brand awareness was low, Triton had managed, as the
only company in the market, to build brand awareness at the consumer level.
2.1.4 Collaborators
Aqualisa has collaborators in their distribution channels. That will be covered in the part 2.2.2.
Furthermore plumbers are very important for Aqualisa. There are roughly 10000 master
plumbers in the UK. Exhibit 4 in the case shows that 73% of the selection of a mixer shower is
decided or influenced by a plumber and only 27% are autonomous decisions by customers. As
a general rule, plumbers distrusted innovation and preferred to install a single shower brand.
They are extremely reluctant to switch brands. Plumbers wanted a shower that was easy to
install, with a guarantee to not break down or require servicing. These facts will turn important
when talking about the new innovation from Aqualisa.
2.2 Capturing value
After the analysis about how to create value the discussion in this part is about how to capture
value. For that reason the marketing mix will be analysed and the concept of the 4 Ps will be
used Product & Service, Place & Channel, Promotion and Pricing.
2.2.1 Product & Service
Aqualisa addressed the different client segment with different products or even brands. The
products and the respective prices are summarized in the table below.

The new Quartz came in two versions: the Quartz Standard Shower was designed for
installations that already had (or did not need) a pump and the Quartz Pumped Shower (included
a pump). Quartz had different advantages. The remote processor could be installed somewhere
close to the shower and therefore reduced the installation time from two days to a half-day. The
installation was very straightforward, so that even the young apprentices could complete the
job. The plumber could focus on other jobs and reduce the waiting time for customers
(consumers often had to wait six months before a plumber could take on a new job).
Also for the consumer Quartz had significant benefits: it provided efficient and reliable water
pressure and temperature. In addition, the one-touch control with the easy-to-use push-button
control light was an additional feature, which clients loved. Aqualisa not only had an invention

Aqualisa Quartz: Simply a Better Shower

Case Analysis

on the market which should help to strengthen the brand, they also had further opportunities
(Once you put a computer in the bathroom, the potential is unlimited).
2.2.2 Place & Channel
Aqualisa sold showers through a variety of channels like trade shops, distributors, showrooms
and DIY outlets. Also the Quartz has been made available in all of Aqualisas normal channels.
Trade shops had as their primary customers the plumbers, who worked for developers,
showrooms, contractors or directly for consumers. Trade shops stocked whatever there was a
demand for and the Aqualisa brand was available in 40% of trade shops. Trade shops were
selling in the year 2000 the biggest amount of showers (840000).
Distributors supplied showrooms. They preferred to carry high-end product lines and brands
unavailable in other channels. The Aqualisa brand was sold in about 25% of the showrooms.
Totally showrooms sold 145000 showers in the year 2000.
Do-it-Yourself (DIY) stores offered discounted, mass-market and do-it-yourself products. The
Aqualisa brand was unavailable through this channel, but its Gainsborough brand was available
in 70% of the stores in the UK. DIY stores sold 650000 showers in the year 2000.
2.2.3 Promotion
Aqualisa was thinking about targeting consumers directly and trying to build a consumer brand
(like Triton has done it). They started as a test a one-time-only print advertisement campaign.
But the advertisement ignores totally the technical innovation. Furthermore there is no
explanation about the cost savings. The shower has a higher retail price, but the cost saving on
the installation overcompensates the higher selling price of the shower.
2.2.4 Pricing
The managing director of Aqualisa was thinking about the pricing of the new product. He had
to generate sales momentum and he was wondering whether a discounted price might generate
more market enthusiasm for his innovation.
2.3 Sustaining Value
To generate long-lasting profits, a company has to think about customer retention (to hold
existing clients) and customer acquisition (to get new businesses). Aqualisa had a 20-person
sales force that sold to distributors, trade shops, showrooms, developers and plumbers.
2.3.1 Customer retention
The sales force spent 90% of the time on maintaining existing accounts. They also had
longstanding direct relationships with a group of plumbers, who were very loyal to the Aqualisa
brand. There is no description about the organisation of the sales force. It is not clear if every
person is serving all the customers or if they were focused on one segment. By being focused,
a specialisation in the segment and growth through network effects would be the result.
2.3.2 Customer acquisition
10% of the time is spent on developing new customers. Network effects could support this task.
For the launch of the Quartz, the sales force had contacted its network of plumbers. That shows
that they focused on existing clients, which is clearly easier, since they were loyal customers.
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Aqualisa Quartz: Simply a Better Shower

Case Analysis

3. Strategy
Before analysing the possible marketing options mentioned in the case, a summary of the
companys situation will be done through a Swot analysis:
Strengths

Weaknesses

- Perception of high quality products (strong

reputation)
- Easy to install products
- Different products/brands for the different
customer segments
- High innovation in technology (R&D)

- Management not convinced about the new

product
- Relatively high defection of products
- Low brand awareness from consumers
- Service still great, but had slipped over the
past few years

Opportunities

Threats

- Need for innovation: low pressure and

fluctuations in temperature not solved
- Rare real breakthrough in the shower
market
- Only 60% of UK household have showers
- Relationship with plumbers

- Plumbers loyal to single brand and

distrusted innovation
- Other companies are catching up in terms
of product quality
- Market begins to perceive Aqualisa
products as being overpriced
- Dependency of consumers to the plumbers

The first question to answer is which client segment has to be targeted. At the moment the highend segment and the showrooms are giving positive signals. The successful strategy with
serving different client segments with different products and brand names could be applied also
for Quartz. It is crucial to not associate the premium brand with the discount channel.
Option 1: Targeting consumers directly
To target the consumers directly would mean to overcome the weakness of a low brand
awareness and build a consumer brand. That needs time and requires a lot of marketing
expenses. With a high brand awareness the consumer could force a plumber to use Quartz but
as discussed in 2.1.4, only 27% of the decisions about a shower are autonomous decisions by
customers. Furthermore, once a shower is installed, the customer does not have a need for a
new shower for the next maybe 10 or 15 years. So it is questionable if it is worth to spend so
much on a customer who has a need every ten years.
Option 2: Targeting Do-it-Yourselfers
Although the Quartz is easy to install (and feasible for DIY customers), the success in the
showrooms prove that it is a product line which is attracting high-end customer. By launching
the product in the mass-market the high-end segment is at risk. In the description of the channels
it was explained, that the showrooms preferred to carry high-end product lines and brands
unavailable in other channels. Since Aqualisa is already present in the DIY stores with a
different brand name, this strategy could be used also for Quartz. With the development of a
simpler and less luxury version of the product, it could be distributed in the DIY stores.
Option 3: Targeting Developers
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Aqualisa Quartz: Simply a Better Shower

Case Analysis

The experience tells Aqualisa that the developers already showed reluctance to spend money
on conventional Aqualisa products because they perceived those products to be premium
brands. Even with a high discount it was hard to convince them. And then there is a significant
time lag before showers would reach the end customer. All these facts prove that it is probably
not the best way to introduce a new product, with a breakthrough innovation, into the market.
The plus side is that the developers would force the plumbers to get familiar with the product.
Why then not to focus on the plumbers?
Option 4: Targeting Plumbers
The main suggestion is to focus on the plumbers. Quartz offers exactly what plumbers are
looking for and the installation by independent plumbers represents 53% of the market share.
The advertisement of the Quartz has to be changed and focused on the plumbers. They need
to realise and possibly experience the benefits for their clients but also for themselves. The cost
and time savings on the installation should be published in a clearer way and the superior value
proposition, with the technical innovation, should be communicated better.
The plumbers need help to overcome the distrust of the technology. Aqualisa could invite loyal
plumbers to an expert conference also a tool for customer retention! The new product could
be introduced and technicians from Aqualisa should be present to help to overcome the critical
attitude towards the innovation. That symposium could be repeated, also as a platform to
acquire new plumbers. Once convinced, existing plumbers could be used as ambassadors and
get rewarded. Why not to include a free Quartz product as a giveaway?
To fight the fear of technological innovation and extra work on broken processors, an adopted
product guarantee could be introduced. In addition the support of technicians from Aqualisa
to fix technical problems on the remote processor could be offered.
Another idea could be to increase the incentives for plumbers to use the Quartz and to convince
others to follow. Loyalty programs with better prices and if legal a kickback program could
support the initiative. This could be combined with the symposium.
When focusing on the plumbers the right distribution channel is also crucial. The most
showers were sold (in the year 2000) in trade shops. Since the main clients of the trade shops
are the plumbers, the importance of that channel becomes obvious. Furthermore plumbers dont
work only for the end client but also for developers, showrooms and contractors. The more
plumbers are converted, the more the effect will be seen on the other distribution channels and
client segments.
Of course first of all the management has to be convinced itself about the Quartz and the
potential that it can become the new core product (and not only a niche product). Quartz gives
the clients better value and if Aqualisa doesnt do it, somebody else will do it.