MKTG3001 Case Study Final Assessment - Dulux Group PDF

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Final Assessment on Case Study Report - Dulux...

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MKTG3001 – Business Analysis Report // DuluxGroup

Introduction Decorative painting and coating industries has shown much growth in demand and sales within New Zealand and Australian homes. Being a leading marketer and creator of many premium brands, they are known for their innovation of products and continues to deliver and create products that accounts for their clients and customer’s interest since 1918 within the Australian market. The company stands on the values of being customer driven, customer focused and being beyond imagination (DuluxGroup, 2020). DuluxGroup has been meeting the clients and customer’s interests with innovating products and brands in indoor and outdoor environments. Well established brands; Selley’s, Dulux Paints and Coatings are all under the DuluxGroup. Through the establishment of brands, they are able to differentiate from their competitors and strive for consumer engagement to guarantee demands are met up with (DuluxGroup, 2020). DuluxGroup operates in business-to-business (B2B) and business-to-customer (B2C) industry markets and partners with many wholesale and retail trade consumers such as Bunnings Warehouse. B2B according to Chang (2014) is a form of transaction between businesses that involves suppliers, wholesalers and retailers rather than an interaction between a company and customer. DuluxGroup gains their clients through about 5000 retail outlets and about 200 trade distribution outlets and channels within New Zealand and Australia. DuluxGroup strives to maintain trust in their relationships with many suppliers and distributors and benefits loyalty and brand awareness (DuluxGroup, 2020).

Competition The main competitors of DuluxGroup are Jotun, Tikkurila and Asian Paints Ltd who are growing in the painting, coating industries and market share. 1) Jotun Out of the competitors, Jotun is the number one competitor against DuluxGroup as they offer similar products and features towards their consumers and clients. Jotun focuses on their consumer analysis through innovative technology and provide top quality coatings and paint

to meet clients and customers interests. Jotun is a sustainable business that offers ‘Greensteps’ to help the environment (Jotun, 2020). Their main products include top quality decorative paints, coatings and finishes of protection against any corrosion or dirty substances. Strengths Jotun pays attention to innovation with their products through technology and key customer analysis. Their decorative paint segment (38%) is one of their popular and best-selling products. It is their key strength within the business and helps improve their market share and profits (Jotun Annual Report, 2019) (Figure Below). Many of their decorative paints is a leader in paint supplying when it comes to commercial buildings and public homes. Another key strength that they have as a company is their trust and healthy relationships with shareholders, retails and involve themselves many long-term projects thus leading to an achievement with global and national networks. Adding on, their strengths also include of updated technology that benefits in innovation and motivation for employees and have strong training programs along with the company’s financial aspects. Their campaigns have helped Jotun in ways of promoting and reaching out to their consumer and clients (Jotun Annual Report, 2019).

Weaknesses Jotun explores their weaknesses through their Annual Report (2019). Even though their sales are growing and establishing, they are still considered to have low brand awareness due to the fact that their promotional aspect is poorly driven and managed. Social media and other mediums can help with promotional activities and relationship communications a (Baurm et al., 2018). Due to lack of exposure through mediums, Jotun was not able to express their brand message and values to other customer and target audiences. Another weakness is their agility in ways of responding to market trends unlike DuluxGroup. In Jotun’s annual report (2017) it shows that Jotun has been struggling with brand awareness and agility and it slowly improving.

2) Tikkurila Tikkurila is a paint company and has common products offering majority paints and specialises in coloured paint. gains market share. They are based in the Nordic region but has not expanded internationally to Australia. Tikkurila is a pioneer of sustainability, surface treatments and solutions that are safe for people and environment (Tikkurila, 2020).

Strengths Tikkurila is known for their strategy and always aims for the best experiences when consumers use their products. Their sense of brand identity, culture of service, sustainability and market leadership are top strengths in their business that allows for competitive advantage within the Nordic Regions (Strategy - Tikkurila, 2020).

Weaknesses On the other hand, Tikkurila can improve on their promotional strategies and manage their global expansion plans to outer regions of Nordic to allow brand awareness.

3) Asian Paints Asian Paints Ltd is among the top competitors against DuluxGroup and illustrates their achievements through profits and sales in both nationally and internationally. However, originated in India, did not expand in the Australian market till the early 1990s and yet growing in sales (Jaiswal, 2019). Asian Paint is all about transforming homes and every environment. Asian Paints manufactures a wide variety of paint for decorative and industrial uses and empowers customers to create the home of their dreams (Asian Paints, 2020). Strengths With their strengths, the company has gained attention and awareness nationally and internationally. Asian Paints have strong global communications and presence/ reputation in which are serving in 19 countries and have many global units in India (Adhikari, 2015). Adding on, the business is very consumer orientated as they want the best interests for their clients and consumers. They also have built relationships with customers and always have managed to seek out customer trends (Asian Paints, 2020).

Asian Paints have clear supply management strategies. With their technology, they are company that is technology-driven organisation that has strong bonds with suppliers and manufacturers that benefits the processes and procedures of products (Bhasin, 2020). Due to the fact that Asian Paints known for being a technology-driven business, their innovativeness and quality of their products aid in B2B marketing and help differentiate themselves from

other competitors. Furthermore, their wide range of product portfolio is a strength as they offer amenities such as auto paints and coating etc to enter various market segments and gain better market share and growth within the organisation (Bhasin. H. 2020).

Weaknesses Asian Paint’s marketing approach can be improved when it comes to brand positioning. With their different industries and segments, Industrial (2.4%) and Auto Paint have low market share in relative to their decorative segments (83.7%) (Asian Paints Annual Report, 20192020). Through the annual report, agility within the business needs to be improved in order for the business to strive and gain competitive advantage. With the never-ending change of customer interests with new house and market trends, it is important that Asian Paints get on top of research and allow the company for strategic planning in the long run (Overby et al., 2005).

Target Market Throughout the DuluxGroup Annual Report (2018), there are three main consumer/customer target markets (figure below) and are: Trade Professionals Through customer channels and B2B, trade professionals have 60% of indicative sales in DuluxGroup. The company has relationships with different trade professions that involves painters, interior and exterior designers and architects to needs coating and painting for work or residential related projects. DuluxGroup invests in iconic brands and invests in innovative products to maintain and grow sales within trade customers (DuluxGroup Annual Report, 2018). Retail Channels With the indicative sales by customer channels, Retail takes on the other 40%, which consists of wholesales and retail trades such as Inspiration Paints, Bunnings and their own Dulux Trade Centres. Many businesses buy in bulk and has sold products through many customers and retailers (DuluxGroup Annual Report 2018). Overall, Dulux is the dominating products within painting and coatings throughout Bunnings (Evans, 2020).

Do-It-Yourself (DIY) This segment of DIY consists of leisure renovations and targets consumers that maintains and want improvements for their homes and work (Wolf & Macquitty, 2011). Many of the consumers in this segment invests in making their ‘homes a better place’ (DuluxGroup Annual Report, 2018). With not much experience or just leisurely paint with family creates an environment that DuluxGroup targets audiences of all ages and demographics despite with experience or not. Adding on, within Dulux trade centres, they offer DIY workshops and also have online content on their websites for guidance.

DuluxGroup Corporate Sustainability Report 2018. (2018).

Suppliers DuluxGroup commits to sourcing products in ethical ways and in a responsibility manner as they manage risks and manage their financial aspects when it comes to sourcing. DuluxGroup

mainly sources their supplies through DGL International. They are the main supplier for Dulux, Selleys and other premium brands under DuluxGroup. It is located in China, Indonesia and South East Asia (DuluxGroup, 2020) and provides coatings, associated products, sealants and adhesives and raw materials in order to make certain products in the painting and coating industry. However, when it comes to supplying Dulux products many companies such as Coco Republic, Grazia and Co. and Fanuli. There are many more Australian stores that Dulux supplies for which favours and aids in brand awareness.

Secondary Data Decision making within companies should be strategically thought and planned out. With the correct tools, resources and planning secondary sources can aid in improving market share, growth in sales, brand equity and brand image (Nwakanma et al., 2011). It is vital for B2B processes to be agile and informative as possible due to the ongoing dynamic nature of corporate business. Brand equity refers to the value and recognition that a business generates from their product (Jeon, 2017). When it comes to DuluxGroup, Keller’s Brand Equity Model (CBBE) (Figure Below) can assist them in the long run and help strategically plan and decide their marketing plans and activities. This model gives many opportunities for competitive advantages and help increase brand equity and identity. It creates the idea and helps shape how a customer feels and experiences the certain product whether it is a positive or negative experience (Baalbaki & Guzman, 2016). DuluxGroup can use this model to improve brand recognition (Wood, 2000). The model is structured through six blocks that fulfils the characteristics of brand meaning and to help differentiate from other markets (Keller, 1993). This model is useful for improving the quality of decision making within DuluxGroup for it allows information and knowledge on consumer behaviours. CBBE model allows for the company to reflect and know its values upon the market. With the knowledge of consumer behaviours, they are able to be innovative in meeting the customer trends and demands that aid in growth and positive impacts of consumer perceptions (Keller, 1993). Furthermore, it strengthens their marketing strategies and business model.

Overall, brand equity is important for DuluxGroup as it is a strong aspect on maintaining a competitive advantage and to continue to reach out to their audiences through top quality products and services.

Keller’s Brand Equity Model – Kevin Lane Keller, Strategic Brand Management: Global Edition; 4th, 2013

Macro Environmental Trends 1) Corporate Social Responsibility DuluxGroup is a big advocate for sustainability and focuses on reducing carbon footprints within the environment. Adding on their CSR standards with their employees and stakeholders has been one of their great standards that still continue on. With their Corporate Sustainability Governance Model (DuluxGroup Corporate Sustainability Report, 2018) offers great guidance on business performance that relates of environmental, social and economic aspects. Environmentally, have saved 7 million kilograms worth of waste paint and packaging through their drop off points. DuluxGroup’s consumption in water and electricity has gone down by 3% comparing to last year is an achievement and involves many community services. 2) Technological

Through manufacturing and processing, DuluxGroup has been on top of their game with technological advancements that allow innovation and creativity within their products. This also allows for the top-quality products to be made with precision and perfection. However, on the social media and internet aspect, they can improve their promotional strategies and be innovative through the creation of applications that can help their consumers, with the new application released in 2015, they can easily apply that online on their website also. DuluxGroup can work on their technological aspect to help differentiate and gain competitive advantages.

Marketing Mix of DuluxGroup Products DuluxGroup consists of many products among their premium brands. Marketing Mix is a model that consists of the 4P’s; Product, Price, Place and Promotion in which businesses apply for new products and services (Al Badi, 2018). and will be explained for Texture Coatings, Decorative Paints and Protective Coatings (DuluxGroup, 2020).

1) Decorative Paints:

Product DuluxGroup has many solutions for both interior and exterior paints with top quality finishes and coatings. This offers a luxurious finish and makes customer satisfied. Through many years of experimenting and trialling the perfect paint finishes, they have mastered their finishes in products such as water-based, oil based and spray paints making them top leading business for decorative paints. Within New Zealand and Australia. DuluxGroup obtains many varieties of decorative painting products such as Dulux Professionals, WeatherShield and Precision that serves for different purposes and instances (DuluxGroup 2020).

Price There are different prices for different products but is usually depending on the size of purchase. However, according to Bunnings Warehouse (2020) the price range is $50 - $200 for either 1-4 litres of paint. Even though Dulux is more on the pricier side, the quality and innovation within their products make the huge difference.

Place

DuluxGroup mainly distributes their decorative paints through retailers; Bunnings Warehouse and other small retailers. Dulux Trade centres are another way of purchasing and endorsing their paints. Adding on, Dulux has their online website that is able to customise according to the consumers wants and calculate finances making it easier to distribute bulk purchases to large clients to cut intermediate costs.

Promotion Their main source of promotion would be social media and print media. Being able to be on magazines and show different levels of interior that creates an advertisement. With Decorative paints, many consumers know Dulux by their iconic Dog, creating success in advertising and promotional activities.

2) Texture Coatings Product DuluxGroup considers their texture coatings to be one of the popular products they sell. It helps to protect from any stains, cracking, corrosions and rust. AcraTex, by Dulux has been in the coating industry for an amount of time and benefited many industrial buildings, households and other surfaces (DuluxGroup, 2020). They offer acrylic texture coating solutions and is the second-largest supplier of texture coatings in Australia for roof restorations, concrete solutions and other protection uses. Price Similar to decorative Paints, texture coatings range from $50 - $205 (1 – 10 litres) and is slightly more expensive and can vary depending on coverage, primer and the desired finish.

Place Similar to decorative paints, they distribute through retailers and different hardware stores. Their online website is another way of accessing and gaining further information. Dulux trade centres and are available locally for guidance from expertise.

Promotion DuluxGroup has not advertised texture coatings as much as decorative paints yet still uses social media such as Facebook and Instagram to update information for any new releases. In

2015, Dulux has released an application through mobile platforms that assists in colour matching, advises and has its own texture coating section (Architecture & Design, 2015).

3) Protective Coatings Product DuluxGroup’s protective coatings has been in the market for about 50 years within the Australian market (DuluxGroup, 2020). It is purchased for the purpose of long durability against corrosion, chemical stains and attacks on buildings and UV radiation. There are many different types of protective coatings that are customisable on clients or customers desire.

Price As price ranges from $10 - $230 and comes in spray cans, 2 – 4 litres containers and is dependent on the type of object that consumers will use the protectant on (Bunnings Warehouse, 2020). Place Similar to the products mentioned, DuluxGroup distributes through retailers and hardware stores, trade outlets and are on display on shelves to show consumers the different finishes and which protectant will suit which surface etc. Aforementioned, their website and local Dulux Trade Centres is another way of helping the clients and consumers through accessibility. Promotion With social media and different promotional strategies, there is not much advertisements on protective coatings, yet is always complimented and recommended for each purchase of paint or other coatings for the product to gain awareness.

Conclusion Conclusively, DuluxGroup manages well in both B2B and B2C processes within marketing. With their top priorities of being sustainable and customer/client driven, they are able to give the best interests to their stakeholders through the innovation of products and always listening to their target audiences. It is important for businesses to know their strategies and make decisions that will benefit both the business and stakeholders.

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References About Us - DuluxGroup. (2020). Retrieved 4 November 2020, from https://www.duluxgroup.com.au/about-us Adhikari, C. (2015). Redefining Business Practices in Digital Age with reference to TISCO and Asian Paints. Pillai Journal Of Management Research, (1). Retrieved from https://www.researchgate.net/publication/299442075_27_Redefining_Business_Practice s_in_Digital_Age_with_reference_to_TISCO_and_Asian_Paints Al Badi, K. (2018). The Impact of Marketing Mix on the Competitive Advantage of the SME Sector in the Al Buraimi Governorate in Oman. SAGE Open, 8(3), 215824401880083. doi: 10.1177/2158244018800838 Architecture, Building & Construction Suppliers | Architecture & Design. (2015). Retrieved 4 November 2020, from https://www.architectureanddesign.com.au/suppliers/dulux/newdulux-colour-app-update-empowering-homeowners Asianpaints - About US. (2020). Retrieved 4 November 2020, from https://www.asianpaints.com/about-us.html Baalbaki, S., & Guzmán, F. (2016). A consumer-perceived consumer-based brand equity scale. Journal Of Brand Management, 23(3), 229-251. doi: 10.1057/bm.2016.11 Bhasin, H. (2020). Brand Equity of Asian paints | Marketing Mixx. Retrieved 6 November 2020, from https://www.marketing91.com/marketing-mix-of-asian-paints/ Baum, D., Spann, M., Füller, J., & Thürridl, C. (2019). The impact of social media campaigns on the success of new product introductions. Journal Of Retailing And Consumer Services, 50, 289-297. doi: 10.1016/j.jre...