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Submitted by caveman on October 16, 2007
Category: Business
Words: 1079 | Pages: 5
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Leadership Essay
From the Harvard Business School case revised May 25, 1993, Rohm and Haas was a leader in chemical technology. One of its four main business segments was Industrial Chemicals, where its strongest product is Kathon 886 MWX capturing 30% of the maintenance biocide market for large systems. Customers who were satisfied with the performance of this product asked for a "convenient, safe-to-use version for their smaller reservoirs" (p4). In December of 1983, Rohm and Haas launched a brand extension called Kathon MWX, designed to kill microorganisms in metalworking fluids for customers with small-capacity tanks. The new product was distributed by large industrial formulators along with the existing Kathon 886 MWX, but sales volume for the product was only 6% of what was expected.
Joan Macey, the marketing manager for Rohm and Haas explained the poor sales as low awareness of the brand and its usefulness along with the lack of competition to build demand. The real problem however, was that Kathon MWX was not positioned correctly. Rohm and Haas was an industrial supplier that was trying to sell a consumer product. Because of the pricing scheme, the customer had a very low perception of its value. Furthermore the distribution channel was not appropriate for this type of product. Just because Kathon MWX may have looked good on paper, it didn't mean the company should have hastily launched the brand.
In this situation, more effective leadership would have helped Rohm and Haas avoid such a negative outcome when implementing its new product marketing strategy. Branding of a new product is not easy, it must be thought through in great detail since there are many different strategies that can be adopted. Therefore, a leader had taken on a more analytical mind-set, it would have been able to position Kathon MWX more appropriately. The company saw a market demand, but did a shallow analysis and used easy techniques such...
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