Jones Blair

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■ Problem/Central Issue
Jones•Blair Company is a privately held corporation that produces and markets architectural paint under the Jones•Blair brand name. The central issue for the company is that during the years the paint gallonage remained stable even if the company raised its turnover by 4% per year reaching the highest priced paint in the service area. The central problem is where and how to deploy corporate marketing efforts among the various architectural paint coatings markets served by the company in the southwestern United States.

■ The Company
The company produces a full line of architectural coatings and sells paint sundries (brushes, rollers, thinners, etc.) under the Jones•Blair name, even though these items are not manufactured by the company. Jones•Blair also operates a very large OEM coatings division, which sells its products throughout the U.S. and worldwide.
The U.S. paint industry is generally considered to be a maturing industry and industry sales in 1999 (only paint) were estimated to be slightly over $13 billion.
Industry sources estimate U.S. sales in a total of $10,00 billion split in $ 5,59 billion on paint and $ 4,41 billion on sundries.

Jones•Blair Company markets its paint and sundry items in over 50 counties in Texas, Oklahoma, New Mexico, and Louisiana from its plant and headquarters in Dallas, Texas. The eleven county Dallas–Fort Worth (DFW) metropolitan area is the major business and financial center in the company’s southwestern service area.
Company architectural paint and allied products sales volume in 1999 was $12 million, and net profit before taxes was $1,140,000 on a market expressing an estimated dollar volume of architectural paint and allied products sold in Jones•Blair’s 50-county service area in 1999 of about $ 80,00 million.

■ Current Big/Picture
Examining the company’s activity and the ideas of the Company’s executives the following issues emerge from the analysis:
1. Business objective:
a. Fundamental Entity: Jones•Blair Company consider the brand name of the firm as its Fundamental Entity;
b. Benefit to customers: high quality paint and sundries products which are “easy to apply and durable…” . In this sense the category definition is identifiable in “Paint coating systems” part of the “Coating system business” which is the company’s core business. High quality is determined by Innovation in paint coating systems is the core competence and other competence is customer service activity mainly carried on by the sale reps to the paint dealers (Jones•Blair survey).
c. Goals: The general goal discussed by the company’s executives is to have an increase of sales (not detailed) in the different markets where the company is operating and depending on each executive’s idea. Goals are not defined with measures, time limit, priorities and realistic target (they are based on general estimate and calculation on market research, industry sources, ecc.).

2. Marketing objective:
In defining the Marketing Objective we must first be aware of the fact that in 1999 Jones•Blair sales are the 15% of the sales in the identified 50-county service area ($12 million sales on $80 million sales of the area) and that the company distributes its products through 200 independent paint stores, lumberyards, and hardware outlets.

Even if the most evident benefit delivered by the Jones Blair is an “easy to apply and durable coating” nonetheless it’s not very clear in the company’s mind who is the customer as there are at least two kind of possible customers with different behaviours and attitudes:
a. End-users customers (both DIY and professional painter) which benefit supplied by Jones•Blair products is that it is “easy to apply and durable…”. They can be split into:
i. Professional painters whose attitude and behaviour with Jones•Blair seems to be well established as they allow the Company to achieve the 29,2% of the total “professional” sales on the DFW area and the 56,3% of the total “professional” sales on the Non DFW area;
ii. Do-it-yourself painters whose attitude with Jones•Blair could be good as a quality product but whose behaviours in buying the product is influenced first by the decision to do the works, second: from the information collected on products, third: the decision where to store and, once into the store, by a set of criteria including price, quality, brand reputation, in other words, customer service on the Store. The end users are not loyal to store as the 46% of the time they decide different stores. Nevertheless in the in the DFW area JB DIY market is the 5,4% (which grows to 10,7% if considered the total volume without mass marketers) and in the Non DFW area sales are 14,6% of the total volume. In this market Jones Blair competitors are the low price producers which distribute their paint and sundries through the mass marketers.
iii. Stores: whose benefit in Jones•Blair products is the level of customer service granted by Jones•Blair representatives.

The confused ideas the business objective are leading the company’s executives to different perspective in their marketing strategies:
1. Advertising Vice President’s idea is to bolster JB presence in the DFW DIY market. This is an Acquisition marketing objective as new customers (intended as DIY end users) must be convinced to the Jones•Blair brand. In this case the emphasis is put into a television campaign to increase the brand awareness. The estimated cost is $ 350.000. Considering the company has a contribution margin of 35% sales should increase at least by $ 1.000.000 only to recover the ads costs.
2. Operations Vice President stresses the accent on increasing the volume in all the DFW and non DFW area in the DIY market by cutting the market price. Also in this case this is an Acquisition marketing objective as new customers (intended as DIY end users) must be convinced to the Jones•Blair brand. This is to be done by a 20% cut in price. In this case, to keep the present volume of profit margin sales should increase by $ 12.765.957 (growing to $24.765.947 with an increase of 186%).
3. the Vice President of Sales would like to commit the company to expand sales into the Non DFW areas both with the DIY people and the professionals painters introducing a sales representative with the objective to develop new accounts. This is also an Acquisition marketing objective as new dealers (and only subsequentely new end users) must be convinced to switch to Jones•Blair brand.
4. Finance is to leave the situation as it is because of the good results achieved. This situation is not possible considering the mature market and high competition level.

3. Source of Volume:
Even if confused, the general Marketing Objective orientation seems addressed to acquisition of customer (not defined). As from research the US paint industry is considered to be a maturing industry growing at the inflation rate it seems likely that the source of volume for the customer acquisition should be found in steal shares to competitors.
Competitors in this case are the other paint and sundries producers. Thinking to the core business of the company as the “coating systems”, competitors could be also the suppliers of alternative coating systems (alternative materials, such as aluminum and vinyl siding, interior wall coverings, and wood panelling).
4. Summary of Jones Blair Current Big Picture:
Based on what above expressed Jones•Blair Company can be summarized as follows:

Competitive position in its market area:

DFW=
Dalla Fort Worth Area
OTHER= the other 39 counties where JB operates outside the DFW Area
DIY= do-it-yourself users

Summary of Jones•Blair key elements:

1 Benefit to Customer: Easy to apply and durable coating
2 Core Competence: Innovation
3 Other competence: Customer service to independent outlets dealing coating systems
4 Core Business: Coating System business
5 Category definition: Paint Coating Systems
6 Competitors: Suppliers of alternative coating systems (maybe even easier to apply and much more durable)
7 Target customer 1: Target audience could be indentified in the end-users of paint coating system
7 Target customer 2: Target audience could be indentified in paint/coating system dealers.

Jones•Blair opportunities

From the analysis carried on and based on the information collected here follows the description of two possible alternative scenarios to develop an alternative Big Picture for Jones Blair.

OPPORTUNY SCENARIO “ONE”
 Target audience: independent paint stores, lumberyards, and hardware outlets in the DFW Area which do not yet sell only the Jones Blair product. Namely the 68 dealer with sales lower than $/k 50 per year. The benefit for the target audience is the level of customer service supplied to the dealers. This in terms of sales reps of Jones Blair, competent, human, committed to the need of the store and CRM. Stores can rely on flexibility in orders, up to date information on new products, new use and new application delivering a better service to their customers. Stores can rely on Jones•Blair Company in managing the day by day work of the stores and its relation with their clients. Once partnership, in the sense above, is felt important the store is supposed to turn “one brand” instead of “Multibrand”. Statistics shows that “one branded” dealer achieve yearly sales 3 to 9 time higher than multiple brand stores. So the strategic marketing effort is to increase in the stores already supplied by Jones•Blair the sales of the brand Jones•Blair stealing market share to other producers convincing the store to became Jones•Blair onebranded. This is because in this area it’s not the category leader and it’s a big spender market.

Summary:

1 Target audience: Independent paint stores, lumberyards, and hardware outlets in the Non DFW Area which do not yet sell only the Jones Blair product
2 Benefit to the target audience: High level of customer service to independent outlets dealing coating systems
3 Category definition: Paint Coating Systems
4 Core Competence: Innovation in paint coating systems
5 Core Business: Coating system business
6 Competitors: Suppliers of alternative coating systems (maybe even easer to apply and much more durable)
7 Marketing objective: Retention
8 Source of Volume: Steal

(*) JB sources refer: “Our reps are on a first-name basis with their customers. It is common for our reps to discuss business and family over coffee during a sales call, and some of our people even ‘mind the store’ when the proprietor has to run an errand or two.”.

OPPORTUNY SCENARIO “TWO”
 Target audience: Professional painter in the DFW Area. In this area there are 400 professional painters who purchase $/Mln 14,4 per year with an average yearly expense per professional painter of $36.000 (against the $16.000 average yearly expense per each one of the 200 professional painter of the Non DFW area whose total volume of sales is $/Mln 4,8). In the DFW area Jones Blair is not the category leader whilst it is the leader in the non DFW area. A steal share source of volume can be applied.
Target audience is professional painters who search an “easy to apply and durable coating system”. These end users are here supposed to be loyal to a specific paint brand. For these audience an “easy to apply and durable coating system” will allow them to save time in doing their work and they can make more contracts (and more revenues) in the same length of time as they are able to reduce their intervention time. Quality in the coating will allow a higher quality of their job and the result for their client.
In this sense the benefit perceived by the professional painter identifies the product category in paint coating systems.
Making the DFW Area professional painter not presently using Jones Blair’s products aware of the JB Brand will reasonably lead them to shift from other brands to Jones•Blair. As in the DFW area the market share of Jones•Blair in the professional market is 29,2% against the 56,3% of the Non DFW area and that average yearly sale is much higher than in the non DFW area, marketing efforts should be oriented to an acquisition strategy to attract professional painters who already are in this market as professional painter switching them from another brand.

Summary:

1 Target audience: Professional painter in the DFW Area
2 Benefit to the target audience: Easy to apply and durable coating
3 Category definition: Paint Coating Systems
4 Core Competence: Innovation in coating system
5 Core Business: Coating system business
6 Competitors: Suppliers of alternative coating systems (maybe even easer to apply and much more durable)
7 Marketing objective: Acquisition
8 Source of Volume: Steal
(*) JB sources refer: “Pot and brush guys [professional painters] do seek out quality products, since their reputation is on the line and maintenance firms don’t want to have to paint an office each time a mark appears on a wall. They want paint that is durable, washable, and will cover in a single coat”.

Recommendations
From the above analysis the total amount of possible increase in sales is almost the same (approximately $ 900.000 equal to approximately 7,0% on total present sales).
Here briefly explained the pros and cons of the two opportunities:

Target audience: independent paint/coating system dealers interested in high level customer service. Target Audience: Professional painter in the DFW Area
Pros Cons Pros Cons
It can be done increasing sales reps workforce It seems that the present work force is not completely efficient Big spender target customer High level of estimate
Retention strategy is less expensive than acquisition strategy (generally speaking) Steal source of volume is expensive and risky Very focused target market Lack of specific studies on professional painter hehaviour
Assumptions made in the B2B2B are much more reliable Ethical issues can arise in not delivering the service promised Ethical issues in over evaluating the quality

There are not counter indications in pursuing the two segments strategy at the same time.
Once converted multibrand stores to JB brand it would be easier to increase the professional painters to a greater awareness in JB products benefits.
Some possible actions:
1. With stores:
a. Increase the CRM solutions to the identified target audience;
b. Increase the sales reps commitment to customer (as it seems that some of them are not very aggressive);
2. With professional painters:
a. Increase brand awareness with a specific and target information, courses and brand awareness activity;
b. Agree with stores a co-joint marketing campaign;
c. Deep product customization on painter’s specification.

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