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MAYTAG'S NEW WASHER/DRYER.
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Develops marketing plan for one-step washer/dryer.... More...
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Paper Abstract:
Develops marketing plan for one-step washer/dryer.

Paper Introduction:
Maytag's new product, a one-step washer/dryer, a tangible good that can be utilized many times (for years), can be classified as a durable, specialty good. Because it is a new product it can also be classified as an unsought good (a key marketing implication) until the public learns about it (Kotler, 1988, pp. 459-460). The salient product attributes of this product pertain to its quality, features and design. In this case, convenient size and time-saving are probably the most important. Quality, in terms of this product, means level of performance (durability, speed, reliability) and conformance to requirements. other attributes could include price, style, and value. Because buyers weigh attributes differently, the differential weighting of needs produces market segments. For

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Selective distribution would offer Maytag the best opportunity toobtain distributors that would offer a better than average selling effortwhile maintaining some control. Quality, in terms of this product,means level of performance (durability, speed, reliability) and conformanceto requirements. The strategy should include sales and distributionobjectives that reflect the marketing strategy, provide a focus for sales-force activities, can be used to evaluate sales-force efforts and results,and identify the targets from which future sales volume will emanate. Englewood Cliffs: Prentice-Hall.----------------------- 8 This name combined with Maytag's logo should be sufficientproduct identification and differentiate it from its competitors. It should identify the product and brand,describe it and it can, also, promote the product (Kotler, 1988, p. Maytag's "One-Step" washer/dryer can be sold by retailers either in-store or through catalog sales. 86-87), it is estimated that demand will be approximately 125, unitseach year for the next five years (Kotler, 1988, p. Otherdistribution outlets could include electronic shopping and electronicshopping, and television marketing. The applicable product attributes of thisproduct may be measured in terms of consumers' perceived benefits. 86-87) and consumers arelikely to consider this issue greatly. The risk in choosing a selective distribution policy is thatMaytag might not be able to adequately cover the market (Kotler, 1988, pp.537-538; Jain, 1985, pp. Maytag's distribution strategy should also include a variety ofappeals: product, logistical, protection provisions, price, and financial-assistance. Hughes, G.D. References Bremner, B. Indetermining the type of retailer used to sell Maytag's newproduct, Maytag must consider the type of consumer search effort they caterto (Guiltinan & Paul, 1985, p. (1988). These stores can be full price departmentstores (corporate chains), discount stores, specialty stores, warehousestores, catalog showrooms, and/or merchandising conglomerates. Research needs to be done on consumer buyingintentions (a purchase probability scale). 92-1 9). Maytag should alsoutilize vertical marketing systems in which distributor actions are highlycoordinated with the manufacturer's marketing strategy. 345). Maytag's strategy should not only be focused on volume sales butprogram objective also. (1985). For this product to besuccessful, Maytag must understand the needs of the applicable marketsegments (Hughes, 1978, 9. Factors that should be considered in this analysisinclude: the number of retailers or wholesalers carrying similar products,amount and visibility of shelf space given to products, amount ofdistributors selling efforts of these products, the amount of inventorycarried by distributors and the level of customer service (Guiltinan &Paul, 1985, p. While full-service retailing would be a preferable selling means, self-selectionretailing and limited-service retailing could also be utilized. 498). Competitive distribution analysis (the availability of the product tobuyers relative to the availability of competing products) should also bedone for this product. Any one of the alternative decisionsprocesses (expectancy-value model), ideal-brand model, or conjunctive modelwould be appropriate for this new product. Jain, S.C. Competitive forces includelaundromats, cleaning services and traditional washing and drying machines. Brand-concept formation is comprised of three parts: brandcomprehension, personal attitude and confidence. Pricing strategy for a new productshould have an impact on the market while discouraging any competition.The best pricing strategies for these goals are either skimming pricing orpenetration pricing. 197-2 1). Because it is a new product it can also be classified asan unsought good (a keymarketing implication) until the public learns about it (Kotler, 1988, pp.459-46 ). 468). Evaluation procedures should beconducted with test markets in order to confirm how consumers will rank theproducts attributes and, therefore, the likelihood of consumers buying theproduct (Kotler, 1988, pp. Maytaghas an excellent reputation (Bremner, 1989, pp. 712-713). Since this is a high-ticket item, Maytagmay need to have that extra selling effort to ensure that its new productgets as many selling advantages as possible. Marketing planning and strategy. The salient product attributes of this product pertain to itsquality, features and design. The target markets for the "OneStep" washer/dryer are time-conscious and time-limited consumers (e.g., twoincome families). Maytagshould, in its marketing campaign, reflect the fact that this is amanufacturer-owned brand (versus a licensed name brand) (Kotler, 1988, pp.163-165), The name "One Step" also is beneficial because it suggestssomething about the product's benefits and is easy to pronounce, rememberand recognize (p. 64). Maytag's new product, a one-step washer/dryer, a tangible good thatcan be utilized many times (for years), can be classified as a durable,specialty good. The label, too, does not have tobe elaborate for this product. 3 5). Business Week, 86-87. Utilizing an equation for totalmarket potential (based on total population, percentage of potential buyers(homeowners), allowing for competition and availability and based on thefact that Maytag is fourth in sales in the United States (Bremner, 1989,pp. 3 5-32 ). And, based on anestimated cost of $35 per unit (p. The most obvious marketing strategy that Maytagcan use in its packaging on this large an item is by putting its companyname, logo and product name on the box. Thesebenefits are both functional and psychological. 69). Homewood, IL: Richard D. Brand image (manufacturers' reputation and the consumers perceptionof the company's quality) will weigh heavily with this new product. 168). Product concept is the more detailed form of a product idea expressedin a way consumers can conceptualize. Marketing management: A planning approachReading, MA: Addison-Wesley. (Allfigures were estimated and used to fulfill the equations and calculationmethods.) The idea of a one-step washer/dryer is a good one. 426), estimated costs for the firstfive years should be $4,375, each year. New York: McGraw-Hill. Maytag in selecting a price needs to cover all of its costs ofproducing, distributing, selling the product and a moderate profit.Selecting a price must also include psychological aspects, and take intoaccount the brand's quality and advertising relative to competition(Hughes, 1978, pp. Unexpected effects on costscould include increase in supplies, materials and other fixed costs. Promotions and knowledgeable sales personnel will be animportant facet of the sale of this product. While this product can be considered to have a specialty or targetedmarket the best avenue for Maytag would be to utilize an intensive patternof distribution--in which a relatively large number of distributors existfor a given area (Guiltinan & Paul, 1985, p. Guiltinan, J.P., & Paul, G.P. other attributes could include price, style, and value. Irwin. 794-795). It is important for Maytag to choose outlets that have the sameprice, age and image segmentation that Maytag has conceived for itsproduct. Can Maytag clean up around theworld? Kelley, E.J. A lower price is usedinitially in order to help the firm penetrate certain markets. Marketing management: Analysis, planning,implementation, and control. (1972). (1985). Maytag's "One Step Washer/Dryer" would be a good name for this newproduct. The product concept not only must consider the other washing/dryingappliances available, but also the size of the new product, availablecolors, and price. Because of the large size of the "One-Step," the item's primary andsecondary packaging needs to be designed purely for safety in shipping anddelivery to the customer. (1973). In this case, convenient size and time-saving are probably the most important. The product concept also defines the product'scompetition--anyone having dirty laundry. Marketing management:Strategies and programs. Because there are no substitutes or competitors for this exact model,demand would not change considerably with a small change in price.Therefore, Maytag's new product demand is considered to be inelastic. Because buyers weigh attributes differently, the differentialweighting of needs produces market segments. Determination of channel strategies must begin with an understandingof where and when consumer needs occur so that the product can be at theright place at the right time. Maytag, most likely, will want to focus on maximum current profit,maximum sales growth and product-quality leadership. (1978). Cincinnati:South-Western. With the rightmarketing strategy and implementation consumers should be willing topurchase the item, thus, ensuring that Maytag has another "winner" on itshands. 3 3). (1989, January 3 ). This determination involves those placeshaving the greatest economies of scale (Hughes, 1978, p. The three most important relationships to be consideredare: (1) the ratio of fixed costs to variable costs; (2) the economies ofscale available to a firm, and (3) the cost structure of a firm vis-a-viscompetitors (Jain, 1985, pp. In general, pricing objectives can be either profit-oriented orvolume-oriented. Penetration pricing would work for Maytag enabling it to maximizesales volume at a satisfactory level of profits. The number of retailersshould be limited by criteria which allows Maytag to choose only thoseretailers who will make a contribution to the firm's overall distributionobjectives and match the marketing goals and image intended for theproduct. Marketing planning and competitive strategy.Englewood Cliffs: Prentice-Hall. All these factors could work as competitive forcesdepending upon final decisions in all categories (Kotler, 1988, pp. In order to determine any market (potential, available, served andpenetrated), Maytag must assess and define the interest, income and accessof potential buyers. Marketing management: Operating, strategicand administrative. Kotler, P. Evaluation of these threefactors in terms of Maytag's new product will help the company make itsfinal determinations as to the brand name (Howard, 1973, p. 162). Because of theuniqueness of Maytag's new product, and the fact that there is not asimilar product in the marketplace, it does have a unique value effect,substitute awareness effect, and difficult comparison effect. 471-473). 418-419). Howard, J.A. Skimmingpricing would be better for Maytag's new product and should be accompaniedby heavy expenditure on promotion (Kelley, 1972, pp. (Percentincreases also need to be calculated to take into consideration the stateof the economy, increased number of homeowners (potential buyers), etc.) Using a simple method for pricing to maximize current profits priceper unit should be $7 per unit (Kotler, 1988, p.

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