Student Name/ID: Adriel Christian Pratomo/2119245

Class: MBA MM 5003 YPC

Date: 02/10/2019

Background
Harry Rawlinson, the managing director of Aqualisa, stated that the U.K. shower
market was filled with problems. The shower construction were ancient and there was rarely
any innovation in the industry. Mainly the problems that occurs are low water pressure,
unstable temperature, and complicated installing procedure. Rawlinson concluded that
Aqualisa need to innovate because he believed Aqualisa is vulnerable to competition.

Relevant Facts
The U.K. shower market was in a stagnant state. Ancient plumbing from the
Victorian era was still used in many homes. This plumbing still relies on gravity and still
have separate boiler to store hot water. Real breakthrough almost never happens in the
industry. The most common innovation that we can see are mostly cosmetics.

This obsolete technology that were still used in the industry caused many problems to
arise. The most common issue that shows up is difficulties in instalation and unstable water
condition. Other issue the customers addressed is the shower easily get gummed up causing
it hard to use.

Basically the U.K. buyers can be divided into three segments: premium, standard, and
value. Premium segment is the type of people that want high performance product and styling
is key factor in making their decision. Standard segment is the type of people that prioritize
perfomance and service. Lastly the value segment are the type of people that prioritize
convenient and price, they want simple and economic products.

Plumbers also plays significant role in the U.K. shower market. Brand awareness
among customers are low and they tend to go to plumbers for product recommendation.
Plumbers usually use a product they know well, easy to install, and have a small chance of
going wrong. They also have the tendencies to avoid innovation because they don’t want to
risk it going wrong.

In the attempt of innovating, Rawlinson discovered that the customers wanted a

shower that looked good, have good pressure, stable temperature, easy to use, and don’t break
down very often. Aqualisa managed to do this by creating a water mixing processor that was
compact and can be stored away from the shower.

The benefit of this innovation for the customers are realiable water temperature and
pressure. On the other hand the benefit for the plumbers are it is very easy to install, it takes
less time and skills to put it to work.
Key Issues
The major key issue that emerge here is the low sales numbers of the Quartz. Aqualisa
had invested years of research and millions of Euro to develop the Quartz. It is a
breakthrough product which had received positive critics from reviewers and awards from
major events.

However despite all the excitement the initial sales results was not at all like what
everyone had expected. The number of units sold was way below what Aqualisa needed to
break the mainstream. This was mainly caused by the consumer’s low brand awareness and
the conservative attitude of the plumbers. U.K. consumers have a low brand awareness when
it comes to shower. They know what they don’t like about the product but they don’t know
anything about the technical side of these products. That’s why they go to a plumber for
recommendation of which product that fits them best. However plumbers tend to avoid
innovative products because most of the time they break down or don’t work at all. This
results in plumber not recommending the Quartz to customers even if they hadn’t tried it yet.

Proposed Step to Address The Issue