EXECUTIVE SUMMARY

I recommend a full launch of the Bond-A-Matic 2000 (BAM) to facilitate IPGs goals of

increasing year-on-year sales of SuperBonder adhesives by 30.81% (from sales of $3.44M to

$4.5M) and attaining a 35% market share amongst core industry groups within the CA market.

Within the market for instant adhesives, Loctites target customer for SuperBonder will

increasingly be a varied group of small- to mid-sized industrial manufacturers interested in

quality control, cost-effectiveness, ease of use and efficiency. With a strong reputation as a

leader in the development and marketing of high-performance adhesives and sealants for

industrial and consumer applications, Loctite is well-situated to lead the growth in this new

market by aggressively increasing efforts to educate a new group of end-buyers of the

benefits of its products. Specifically, I propose that Loctite initiate production of BAM 2000

and concentrate on marketing it to small and mid-size firms within the SIC 35-39 industry

groups who use between one and nine pounds of CAs annually.

CUSTOMER ANALYSIS

In FY 1978, SuperBonder adhesives captured a 34.64% share of the industrial market for CA

and Quick Set 404 maintained a 5.36% share. While sales in CA were growing by more than

20% annually, the industrial segment grew even faster at 26.42%. Within the industrial

segment, sales of SuperBonder adhesives grew by 47.47% from FY 1977 to FY 1978 indicating

that SupeBonder was stealing share from competitors while attracting new users as well. If

Loctite could sustain such growth, it would have no problem reaching its targeted goal of

further increasing sales by 30.81% in FY 1979 to $4.5M.

While the industrial segment within CA was highly fragmented and firm size was a poor

predictor of CA demand, more than 50% of IPGs current SuperBonder adhesive sales came

from distributors who sold to either small or medium OEMs. Small firms accounted for 55% of

total industrial volume and, in 16 SIC groups, more than 10% of firms used instant adhesives.

The Systems Division developed the BAM 2000 in response to difficulties among assembly

line workers in dispensing CA from standard one-ounce and smaller bottles. The BAM 2000
would allow these end-users to precisely dispense dots, dashes, or lines of adhesive quickly

and without mess.

With only 16% of firms using instant adhesives, Loctite had an opportunity to create primary

demand and expand the size of the market while also increasing its share within it. As a

leader in a young and growing industry, Loctite should educate the market about

SuperBonders many applications and uses. With regards to the BAM 2000 however, Loctite

should not market it as standalone product but as complementary to SuperBonder adhesives.

By targeting based on benefits, usage and decision processes, Loctite should concentrate on

plant and production engineers as well as company presidents at small to medium sized firms

in SIC industry groups 35-39 that use between one and nine pounds of instant adhesives

annually. This segment currently includes 8997 firms with a potential to grow to 14,763 firms

based on the industry estimates provided in the case.

SIC 35-39 Moderate* SIC 35-39 Heavy SIC 35-

Group Use Use 39
# Current Users
Establishments 8997 3413 31023
# New Potential User
Establishments 5766 2187 19883
Total 14763 5600 50906
*Moderate Use: 29% of firms purchased between one and nine pounds annually; Heavy Use: 11% of firms purchased more

than 10 pounds annually

Segmenting our market in this way allows Loctite to use BAM 2000 to introduce new users to

instant adhesives and to react to the expressed interest of current SuperBond users with

improved dispensing technology. The industries within the selected classification are

characterized by small to medium usage with strong opportunity to convert additional

nonusers in the future. Their products are subject to frequent design changes and their

production processes are better suited for BAM 2000 than for anything else on the market

including the cumbersome one-ounce bottles that are prone to clogging and making a mess

on the assembly line. BAM 2000 provides these users with greater precision, control,

reliability and efficiency while they work.

COMPANY ANALYSIS

1
As a pioneer in the market for instant adhesives, Loctite is one of three companies that

altogether account for about 75% of the industrial CA market in the US. Unlike other

competitors, Loctite is unique in that it also manufactures automatic adhesive dispensing

equipment to complement sales of CAs. Loctites Systems Division was responsible for more

than 15% of IPGs FY 1978 sales. It precisely engineered and sold automatic adhesive

dispensing equipment for large firms at up to a 33% premium over comparable equipment

from competitors.

The Systems Division developed the BAM 2000 and the Gluematic tip to address the needs of

a different type of user the assembly line worker in a small to midsize plant who found it

very burdensome to work with the one-ounce bottles that are prone to clogging. By increasing

the precision and reliability of equipment available to such workers, the BAM 2000 played

directly to the Systems Divisions unique competitive advantage purposeful, high-quality

innovative designs andwill drive IPGs growth into new markets that already comprise 70%

of revenues.

In FY 1978, sales of SuperBonder adhesives increased by 42% from FY 1977. Over 50% of

SuperBonder adhesive sales were made through Loctites distributors who resold to medium

and small OEMs. Since small firms accounted for 55% of volume of the instant adhesive

market, Loctite could continue to leverage its highly qualified salespeople to educate

distributors and end-users about the benefits offered by BAM 2000 and provide BAM 2000-

specific training programs. By doing so, it could convert more nonusers to users and

encourage greater consumption by current users.

Loctites strong relationships with its 285 distributors were highly valued because they

allowed the company to command premium prices, expect distributors to carry a full line of

Loctite adhesives and list Loctite products in their catalogs. Loctite should strengthen these

relationships to protect and encourage sales and overcome distributors reluctance to stock

equipment that required servicing. The company should incentivize salespeople and

distributors with a matching commission percentage for equipment as for adhesives and offer

distributors a matching 25% margin on sales of the BAM 2000. Additionally, as neither

2
salespeople nor distributors have previously been pushed to sell equipment, Loctite should

train both parties on using the BAM 2000 for various applications as well as on the benefits it

offers to end-users.

The Systems Divisions doubts about being able to manufacture large quantities of the BAM

2000 and about their ability to service a high volume of service requests from inexperienced

users posed a serious limitation to the launch. As a market leader, Loctite cannot afford to

jeopardize its reputation for quality and service with a new launch of a complementary

product. The company should control its initial quantity of production to ensure that this does

not happen or look for ways to outsource production of the BAM 2000.

Financially, Loctite is well situated to launch BAM 2000 as an augmented product to

complement and drive sales of SuperBonder adhesives. With 25% of Loctites sales in FY 1978

and a CAGR of 25%, IPGs sales should grow from $32M in FY 1978 to $40M in FY 1979 even

without launching the BAM 2000. Additionally, the up-front R&D and investment costs of

$48,000 represented 1.5% of SuperBonder sales from FY 1978. Without accounting for various

marketing scenarios, at a price of $200 for distributors, Loctite would breakeven with 223

units of the low-pressure model or 310 units of the high-pressure model (a 3.6% market

share: 553/14763). With the most aggressive promotion strategies including both direct mail

and following the proposed media schedule, at a price to distributors of $200, Loctite would

breakeven with 934 high-pressure models and 673 low-pressure models (a 10.8% market

share of: 1607/14763).

COMPETITOR ANALYSIS

The BAM 2000 would be entering the market at a price point far below the automatic

dispensers made by competitors (which sell for $483) and by IPGs System Division ($725 and

$1200). As a manual dispenser it will not likely steal share from competitors who manufacture

automatic dispensers catered at larger firms. Since current competitors have limited

resources and are highly fragmented in different regional markets or specific industries, there

3
is little direct threat posed by them. However, if sales of BAM 2000 increase very quickly or

the product is highly profitable, there are few barriers to entry prohibiting new competitors

from entering the market for mechanical adhesive dispensers. Furthermore, a successful

launch of BAM 2000 by Loctite may encourage 3M, Eastman, and Permabond to begin

developing their own dispensers for their line of instant adhesives as well.

As a first-mover, Loctite has established its competitive advantage in CA and has been

growing among industrial groups by stealing share from competitors. While its marketing

campaign in FY 1978 clearly paid off, it must continue marketing to educate potential users

about its products and converting more users to BAM 2000 thereby raising switching costs for

competitors.

Cannibalization with IPGs Systems Decisions applicators is not a concern because they cater

to very different usage levels. It would not be pragmatic for a large firm using more than nine-

ten pounds of SuperBonder to switch to the BAM 2000.

PRODUCT, PRICING AND PROMOTION STRATEGY

BAM 2000 complements the SuperBonder line of instant adhesives. SICs 35-39 are very

heterogeneous with regards to their uses and applications for instant adhesives. Sales of BAM

2000 should be accompanied with the Gluematic tip, the Vari drop needle and applicator.

Though BAM 2000 and the Gluematic Pen use the same applicator, the vastly different size of

adhesive that accompanies each negates the possibility of rivalry between them. As adoption

of BAM 2000 increases, sales of one-ounce bottles will decline and may at some point need to

be eliminated altogether pushing demand to either the one-pound containers or the three-

gram Gluematic Pen.

I recommend introducing both the high- and low-pressure models of the BAM 2000 at $200 for

distributors and $250 for the end-user. Pricing the BAM 2000 this way eliminates the need to

get sales cleared by the purchasing department and allows the majority of purchasing

decisions to be made directly by production and plant engineers and owners of small firms.

The $200 price for distributors incentivizes them to stock equipment by raising their margin

on equipment sales to 25% (equivalent to their margin on adhesives) presenting a greater

4
incentive to market these products to their customers. Additionally, the suggested pricing

scheme allows Loctite to pursue a price skimming strategyin line with the premium it charges

for its other products.

I am not certain about the target customers price sensitivity. Though the market survey

indicated that price was not very important in instant adhesive purchase decisions, I wonder

whether price will become more important as firms start spending a lot more money on such

purchases, especially as their orders grow from one-ounce bottles to one-pound containers

with a dispenser.

At this early stage in the market, many potential users have little knowledge about instant

adhesives and their capabilities. In order to continue growing, Loctite must employ a pull

strategy and continue its highly successful advertising campaign to raise consumer

awareness, change their perceptions and preferences, and educate non-users about the

SuperBondline of adhesives.

To encourage sales and adoption of BAM 2000, Loctite should follow through with the

proposed media schedule in conjunction with SuperBond advertising and incorporate the

direct-mail program to reach the full list of 14,740 potential users of instant adhesives in SICs

35-39 with moderate use (between one and ten pounds). Loctite should insert brochures in all

SuperBond packages and highlight anti-clogging features to target current users. When

sending a package through the direct-mail program, I would suggest that the brochure

describing BAM 2000 focus on benefits it provides with user testimonials. Finally, when

following the proposed media schedule, Loctite should not highlight anti-clogging features as

the goal here is to target new users as well as nonusers.

DISTRIBUTION STRATEGY

At this early stage, I would not recommend any changes to the current distribution strategy

and would revisit in the future if competition increases or when BAM becomes a well-

established product. Loctite has strong relationships with distributors and these distributors

already manage over 50% of current sales of SuperBond adhesives. By incentivizing

5
 distributors to stock equipment, the goal is to have them sell BAM 2000 as a complement to

all SuperBond adhesives.

Exhibit 1: Market Analysis by SIC Industry Group

Additional
Instant
% of
Number of Adhesiv % of User Usage per
SIC Potential
Industry Establishm es Establishm Establishm
Code User
ents Usage ents ent (lbs)
Establishm
(lbs)
ents
0.34471640
20-24 Food, Textile, wood products 92874 5.00% 7.60% 7
4700
0.34471640
26-27 Paper and printing 62872 14.3% 6.40% 7
5.70570570
25 Furniture 13875 9500 12% 20.20% 6
28-29 Chemicals, petroleum products 20167 15850 12.50% 6.00% 6.28749938
3.19822046
33-35 Metal products, machinery 102523 48200 14.70% 7.80% 2
8.02158953
36 Electrical and electronic equipment 19610 42000 26.70% 18.30% 5
Scientific instruments, photo 3.80429424
38 equipment, watches 10143 10650 27.60% 20.10% 4
2.05434389
30-31 Rubber, platstic, leather products 16332 15.30% 9.70% 3
2.05434389
32 Stone, clay, glass products 19190 15.10% 3.80% 3
27350
2.05434389
37 Transportation equipment 11771 17.30% 15.20% 3
2.05434389
39 Jewelry, toys, sporting goods 23904 24.60% 18.70% 3
Transportation, communications, 0.99952984
40-49 utilities 135657 16000 11.80% 7.10% 6
70, 72, 0.36071283
73 Personal, tourist, business services 282239 8450 8.30% 6.20% 2
1.82795629
75 Motor vehicle services 89257 58900 36.10% 10.10% 2
0.51062663
76 Appliance repair 85838 13500 30.80% 4.10% 2
2.33374924
78-80 Entertainment and health services 42001 9900 10.1% 5.60% 4

Exhibit 2: Breakeven Analysis for the Low-Pressure and High-Pressure BAM 2000*

Breakeven on Low Price to End Price to Price to Price to

Pressure BAM User Distributor Distributor Distributor
Variable Cost 75 75 75 75
Assembly Cost per unit 17.5 17.5 17.5 17.5
Total Variable Cost 92.5 92.5 92.5 92.5
R&D Cost 24000 24000 24000 24000
BAM Advertising Cost 25908 25908 25908 25908
Direct Mail Advertising 22447.5 22447.5 22447.5 22447.5
Total Fixed Cost 72355.5 72355.5 72355.5 72355.5
6
 Price 250 200 187.5 175
BEV 459.4 673.07 761.64 877.04
BEV Share 3% 5% 5% 6%

Breakeven on High Price to Price to Price to

Price to End User
Pressure BAM Distributor Distributor Distributor

Variable Cost 105 105 105 105

Assembly Cost per unit 17.5 17.5 17.5 17.5
Total Variable Cost 122.5 122.5 122.5 122.5
R&D Cost 24000 24000 24000 24000
BAM Advertising Cost 25908 25908 25908 25908
Direct Mail Advertising 22447.5 22447.5 22447.5 22447.5
Total Fixed Cost 72355.5 72355.5 72355.5 72355.5
Price 250 200 187.5 175
BEV 567.4941176 933.6193548 1113.161538 1378.2
BEV Share 4% 6% 8% 9%
*Assuming that direct mail and BAM advertising cost are split evenly between the high pressure and low pressure systems

7
Exhibit 3: Advertisement Bond-A-Matic

8
a. CUSTOMER ANALYSIS

Market share of adhesives was held high by LOCTITE, versus its two major
competitors EASTMAN KODAK and PERMABOND. LOCTITEs SUPERBONDER Adhesives
captured a market share of 34.64%, which led the industry market share for
CYANOACRYLATES, and Quick Set 404 to maintain a market share of 5.36%. It was
seen that the market trends were moving in favor of LOCTITE as sales from
CYANOACRYLATES were growing by 20% annually and that of the industrial segment
at a much faster pace by 26.4%. Moreover, inter-industry sales of LOCTITEs
SUPERBONDER adhesives were seen to grow by 47.4% within one year, from fiscal
year 1977 to fiscal year 1978. This was a clear indication that LOCTITEs
SUPERBONDER was aggressively capturing the market share from two of its major
competitors and it was also pursuing an aggressive strategy in attracting potential
new users. Furthermore, it is estimated that if LOCTITE sustained this growth, then it
would encounter no problem in capturing the target market that it intends to capture.
This would help LOCTITE to increase its sales by 30.81% in Fiscal Year 1979 to $4.5M
as mentioned in LOCTITEs case.

The Industrial segment for CYANOACRYLATES is a highly fragmented segment in the

Adhesive Industry. The firm size was found to be a poor predictor of
CYANOACRYLATES demand in the target market and at present, LOCTITEs
SUPERBONDER was giving major chunk of sales (approximately 50% of the total IPGs
sales). These sales were carried out by 285 trusted distributors of LOCTITE out of the
total 10,000 distributors nationwide. These 285 distributors were either small or
medium Original Equipment Manufacturers (OEMs), who accounted for almost 55% of
the total volume (industrial) and in 16 Standardized Industrial Classification Groups,
the usage of instant adhesives was more than 10%.

The development of BOND A MATIC was a result of the problems faced by most of the
assembly line workers, who used to use the earlier version of adhesive. The difficulties
faced were dispensing-off the CYANOACRYLATES from the proposed one-ounce and
smaller bottles standard. BOND A MATIC was a solution to this problem, and it helped
end-users to efficiently dispense-off, dots, dashes, or lines of adhesive from a
relatively easy method without creating mess. To seize this opportunity, LOCTITE
planned manufacturing BOND A MATIC, with an aim to cater the needs of the target
market and also to expand its market share further. With a young aggressive player in
the market, LOCTITE initiated efforts to educate end-users of the potential uses and
many applications of LOCTITEs SUPERBONDER. As BOND A MATIC was priced low, it
might distort LOCTITEs quality image in the mind of consumer and therefore it is
advisable that LOCTITEs BAM 2000 must be introduced as a compliment to LOCTITEs
SUPERBONDER Adhesives. For achieving a target purely based on maximizing
benefits, usage and decision processes, LOCTITE needed to concentrate much on
plant and production engineers as well, other companys major directors from the
Standard Industrial Classification Groups that lie in between 35-39, that use at least
9
nine pounds of instant adhesives annually. According to the current industry
estimates, this segment currently includes 8,997 firms that will grow at a good
velocity and reach up to 14,763 firms.

Market segmentation, would help LOCTITE to use BAM 2000 in a way to introduce new
users to instant adhesives and by complementing it with SUPERBOND, portray it as an
improved version of the dispensing technology. This would help in gaining acceptance
by other non-users too in the near future.

b. COMPANY ANALYSIS

LOCTITE stands as a pioneer in the instant adhesive market at present and stands
number one amongst its three competitors. LOCTITE accounts for 47.5% of the share
in the CYANOACRYLATES industry. It also manufactures automatic adhesive dispensing
equipment to elevate sales of CYANOACRYLATES in the market. Moreover, more than
15% sales of IPG (industry products group) in the fiscal year 1978 were contributed by
LOCTITE. Further to retain and establish a strong image in the mind of consumer,
particularly large firms, it sold its automatic equipment at 33% premium. The
introduction of BOND A MATIC 2000 and the GLUEMATIC TIP to cater the difficulties of
clogging faced by experts was a competitive landscape achieved. It increased
precision and reliability in their work and helped them go beyond standard one ounce
usage. It proved to be purposeful, high quality product with a novel design. In addition
to this, the BOND A MATIC 2000 helped IPG to boost its growth in new markets with a
revenue growth rate of 70%.

Relationship with the distributor is LOCTITEs major strength. LOCTITEs strong

relationship with its distributors helped it to command premium price for its products.
Further, this relationship motivated the distributor to carry all of the LOCTITEs
adhesive products. What LOCTITE now needs to do is, so it needs to strengthen its
relationship further to overcome its distributors reluctance to stock products that
need maintenance..

10
 Loctite Corp.: Industrial Products Group

Executive Summary:

The case is based on the launch of new product for which a detailed market analysis
along with market analysis has been done. The case includes all the components that
are required in the marketing mix. Loctite Corporation needs to find out proper
marketing strategies to make planning for design in order to dispense the adhesives
and equipments used in the industry. The company is involved in the manufacturing
of these equipments and adhesives. The analysis done in the case suggested that the
company needs to make a marketing plan for a product known as Bond-A-
Matic 2000 (Bond-A-Matic). The marketing plan for Bond-A-Matic will be similar to the
one which was made in 1978, however; it includes an increase in sales by$4.5 million
along with at least 35% share in the market. The company has planned to achieve
this 35% market share through increased brand recognition and awareness. In
addition to that, the company needs to educate the individuals who are not using CA
adhesives about the benefits of the product. The marketing department of the
company will do this with the help of different media channels.

Introduction:

Loctite Corporation is a global leading manufacturing company of sealants, adhesives

and relative products. The company was founded in the year 1956 and located in
United States with its headquarter in Newington, Connecticut. The company
performed extremely well in 1980sthus; it achieved tremendous growth in the
adhesive market. As of now, the company is located in more than 33 countries other
than United States. Majority source of the companys sales is outside U.S.

Company Analysis

The objective of the company is to clear to every stakeholder who stated to become a
leader of the adhesive industry. The company is a leader in the market of sealants and
adhesive material. In order to achieve the consistency of being a market leader,
Loctite Corp. focuses on the provision of high quality of products to its
customers along with high price strategy in order to cover the cost. The structure of
the company is divided into three profit centers with minimal internal rivalry. The
Industrial Products Group enjoys most of the companys sales from the newer and
advanced technologies that are CA and Anaerobic. These two products are free from
any problems in comparison with the other technologies in the adhesive market.
Moreover, the company has registered a patent against Anaerobic and enjoys 85% of
the share in the market. The customers for Anaerobic are limited as they have not
accepted the apparent advantages of the product. On the contrary, the company is
looking forward to take part in the estimation of market growth in the adhesive
industry of the CA market. The company has successfully adjusted and differentiated
the pricing of Cyanoacrylates products with the aid of market penetration to increase
11
the volume of customers. The company is also using market skimming to attract and
retain the loyal customers of Quickset404 who are not so price sensitive. In addition
to that, the company is differentiating itself from its competitors by manufacturing
automatic adhesive dispensing equipment so as to harmonize the sales of
Cyanoacrylates. Loctite Corp.s system is engaged in the engineering and selling of
automatic adhesive dispensing equipment for giant firms and is responsible for more
than 15% of the sales.

Customer Analysis:

The Bond-A-Matic ought to be positioned not as an irrelevant product yet as a fitting

item to Super Bond adhesives. Super Bonder adhesives will be utilized with Bond-A-
Matic to stress linkage; this will be done when promoting the position of Bond-A-Matic
as an extra tool for the Super Bonder glues, not the other way around. The center of
the arrangement is to utilize the Bond-A-Matic as a technique for acquainting new
clients with instant adhesives and to respond to the communicated enthusiasm of
current CA clients with enhanced techniques used in dispensing. The intended target
groups for the plan range from small to fair-sized organizations that are non-clients
and organizations that are CA clients, which will profit from utilizing the Bond-A-
Matic;the commercial enterprises inside SIC 36 through 39. The businesses in this
characterization extent are described by litter utilization; their items are liable to
incessant changes in the design and henceforth are best suited for Bond-A-Matic that
works with any Loctite Corp.s adhesive. In addition, the Systems Division's tools
indulge the need of bigger firms that can't be met by Bond-A-Matic. Hence, Loctite
Corp. will be concentrating on its client by focusing their needs with the intention to
expand the buy volume and keep away from the product offering cannibalization.
Further in light of the pricing strategy, which is discussed later on in the case; one can
evade the design engineers and acquiring staff from getting included in the
purchasing choice. Plant and production designers can settle on the buy choice about
the dispensing equipment autonomously up to the expense of $250; which makes
them their intended target group. This will aid in keeping up the contrasts in choice
making techniques with different distributors. Factors like unmistakable contrasts
between Bond-A-Matic and different dispensers in value, adhesives to be utilized with
and accuracy makes it appealing for diverse clients of Loctite Corp. that circles in with
its strategic destination of increasing the base of new clients. More than 60% of firms
utilizing more than three grams and not more than nine pounds of instant glues are
the target clients of Bond-A-Matic.

Contender Analysis:

The Bond-A-Matic 2000 will be entering the business at a value point far below the
programmed dispensers made by contenders that offer them for $483 and by IPG's
System Division of $725and $1200. As a manual dispenser, it will not be likely to take
offer from contenders who make programmed dispensers cooked at bigger firms.
Since current contenders have constrained assets and are highly divided in diverse
territorial markets or particular businesses; hence there is minimal immediate danger
12
postured by them. On the other hand, if offers of Bond-A-Matic
2000 build rapidly or the item is highly productive, then there are few hindrances to s
ectiondisallowing new contenders from entering the business for mechanical adhesive
dispensers. Moreover, an effective dispatch of BAM 2000 by Loctite Corp. may
empower 3M, Eastman, and Permabond to start creating their dispensers for their line
of adhesives also. As a first-mover, Loctite Corp. has secured its preference in CA and
has been developing among groups of industries by taking offer from contenders.
While companys advertising battle in FY1978 unmistakably paid-off, still it must keep
promoting to teach potential clients about its items and shift more clients to BAM
2000; consequently this will raise exchanging costs for contenders.

Product Strategy:

Gluematic Tip will be utilized as part of Bond-A-Matic for hard surfaces. Vari Drop
needle in mix of Vari Drop instrument will be utilized for free falling drops and delicate
surfaces. In this manner, to fulfill the recommended clients that are SICS 35-39, who
are extremely heterogeneous concerning their commercial enterprises; the
organization will give them both the heads. Loctite Corp. causes low cost for giving
both heads.

Bond-A-Matic was produced as per the needs of assembly specialists and

consequently imparts no interior competition to Gluematic Pen because of the diverse
size. Bond-A-Matic not just inherits all the aces of Gluematic Pen but it also tackles the
issue of obstructing and
lumbering bottles of one oz jugs, refers from Exhibit 3 of the case. With the effective c
ommencement ofBond-A-Matic, just 150 g containers will be utilized for clients
requiring more than three grams of adhesive every year, hence declining the offers of
one oz. So litter bottles among the
51% populace who communicated enthusiasm towards innovation related to dispensi
ng. Thus Gluematic Pen will be reveled in by the family unit audiences with less
than pound utilization. It is prescribed presenting Bond-A-Matic with its High Pressure
model along with Low Pressure model. The proposed deals cost for Bond-A-Matic with
both models is the same.

Low Pressure models are less expensive which brings about higher edges. In addition
to that, Low Pressure models might be utilized with two separately four of five Super
Bonder adhesives as well. Adhesives 495 and 425 must be utilized with Low Pressure
model and contribute to half of existing sales. Adhesive 416 utilized for sporadic and
permeable surfaces can be utilized with just a High Pressure
model. Along these lines, the choices inside the item will be a flawless fit for unique
target clients needs.

Pricing Strategy

13
Strategy used by Loctite Corp.'s calls for high costs and not for low-value market
infiltration. In this way, it is suggested to expand the cost of the Bond-A-Matic
alongside one Gluematic Tip in addition to Vari Drop Needle and a Vari Drop Applicator
to $250 for end client and $ 195 for a wholesaler. The cost of the Bond-A-Matic needs
to position the item as successful and durable while staying under the widely
accepted $250 optional acquiring cap. With this price, the plant and production
specialists as well as the target clients can choose freely about the purchase of
equipment including fill. Factors like higher costs of the company, engineers and
buying staff gets included; leaving no contrasts in decision-making procedure with
different dispensers. Consequently, value will be expanded not be higher than $250
for conspicuous distinction. This does represent a limit to expand cost for future and
go about as a hindrance for increment in cost. However, the organization can give
additional edges to wholesalers over adhesives that can give them the impetus to
stock these supplies over their propensity of keeping away from gear stockup with
oblige service. Loctite Corp. will in exchange appreciate a margin from the end clients
along with distributors as well.

Promotion Strategy:

It is proposed that the standard mail program number 2 be actualized concentrating

on the preferences of the Bond-A-Matic and the Gluematic dispenser tip and in
addition
conveying the profits of adhesives that are instant. Despite the fact that print publicizi
ng is so wide, it is not possible to effectively market the Bond-A-Matic independently;
hence it is prescribed that the proposed promoting schedule for the Super Bond items
be modified to incorporate an altered print ad that incorporates a reference to Bond-
A-Matic. Loyalty of brand will be reinforced once the end client starts to utilize the
Bond-A-Matic in conjunction with Super Bond adhesives. Additionally, it is prescribed
to proceed with the utilization of the Loctite Corps logo on the Bond-A-Matic to fortify
brand personality. The Bond-A-Matic and the Gluematic allocator tip will be situated as
a correlative item without weakening the Super Bond message. In this way, the
expenses of the print promotion will be charged to the Super Bonder advertising plan.
Loctite Corp.'s merchants, accommodating 62% of aggregate buys will accept a data
parcel that will clarify the profits and evaluate time tables. Embed leaflets in Super
Bonder bundles highlighting anti-clogging up gimmick here.

Place (Distribution Strategy):

It is not suggested to expand the system of distribution. This alternative can be kept
for future when rivalry builds and Bond-A-Matic turn into an entrenched product.
Loctite Corp. is known for its nearby associations with merchants. It is prescribed
utilizing the current whole-sellers and retailers, on account of their skill to deal with
the present in excess of half Super Bonder adhesive deals. This methodology lies in
sync with Bond-A-Matic's situating which is not standalone; however, it is integral to
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Super Bonder. Nonetheless, since the essential client of the company is modern, it
ought to underscore on immediate offering to the client or retail store by expansion.

STRENGTH

Adhesive market for long time

market knowledge and selling experience
strong growth in sales
good image & reputation
focus on high quality
clearly stated goals and objectives
organized distribution system
strong market orientation
WEAKNESS
high commission charged by sales people with no incentive
serve small market only
high variable cost

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