Loctite Corp.

LOCTITE CORP.

INDUSTRIAL PRODUCT GROUP

Dadang Beny Kurniawan

Regular Class of July 2005

Marketing

Company Background:

* Founded in 1953 by Vernon Krieble, Ph.D

* In 1956, sales totaled $7,000 though net income was at a deficit of $17,000

* by 1964, sales had reached nearly $2 million and net income jumped to $220,000

* On October 26, 1976, Loctite's stock was admitted to listing on the New York Stock Exchange

* Loctite merged with International Sealants in 1970 and also acquired several of its overseas distributors throughout the 1970s

* Loctite products include anaerobics, cyanoacrylates, silicones, polyurethanes, epoxies, acrylics, and UV rapid curing sealants for use in engine, transaxle, climate control, powertrain, steering, passenger restraint, sound system, body, and headlamp componentry.

Consumer Information:

Consumer Type:

A. Consumer

* Concern on Price

* Reliability of the product

* User Friendly

B. Industrial

* Equipment

* User Friendly

Sales by Product Line:

A. Anaerobics : $17.2 mil

B. CAs

* SuperBonder (91.8k lbs@37.45) 3.44 mil

* Quick Set (14.2k lbs@129.40) 1.84 mil

5.28 mil

C. Equipment

* System Division accounted for at least $4.8 mil ($32 mil x.3 x .5)

SWOT Analysis

Strength Weakness

1. Distributor holds 50% Superbonder sales.

2. Relationship with distributor is highly valued.

3. BAM offer many advantages to end user. 1. Commission percentage on equipment is lower than adhesives

Opportunity Threat

1. The product, BAM 2000, is low cost product

2. They are demand from marketing group From the side of competitor, Loctite have some potential competitors which are

1. 3M Company, for Anaerobic Adhesives product. 3M has highly trained sales force in promoting anaerobic and CAs aggressively.

2. Parmabond Division of National Starch and Chemical, Inc. It is a Unilever subsidiary.

General Strategy ( as a Loctite Corp. )

* Maintain share in anaerobic market

- switch from competitors

- increase usage for other applications

* Maintain market and technical leadership

- in adhesives

- in equipment

* Increase chemical rather than mechanical

- adhesive rather than solvents

ISSUES:

* Should we introduce BAM? From the other side of view, we see also that the similarity between Bond-A-Matic and SuperBonder might jeopardize the marketing plan.

Answer is yes!

The reasons are:

1. adhesive market was growing at about 10%

2. Cyanoacrylates ( CA ) sales were increasing twice as fast. ing.

* If so, what should the marketing program be to support BAM?

Marketing program:

* Product Strategy

 Positioning

Develop more specific customer in order to make an differentiation for the product.

 Name

Loctite can use a different Bond-A-Matic 2000 for the name of the product

 Models

For model, we should launch both high and low pressure models. Because both have different function on viscous adhesive, they can give alternative to our customer.

 Assembly

Find the cheapest production system that may come from outsourcing from others company

without package.

* Pricing

 BAM price

BAM price should be higher than $ 175 end-user price. Because for this market is not price sensitive and our image on the market is good quality and high price

 Price

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