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Group 5: Team Case Number One

Culinarian Cookware:Pondering Price Promotion

Andrei Grechko

Shane Johnston

Nakia Lape

Kyle McDaniel

Kevin Niehaus

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Organization

I. Objectives and Constraints

II. Financial ConditionIII. Management Philosophy

IV. Organizational Structure

V. Organizational Culture

VI. Summary of Strengths and Weaknesses

VII. Implications for Strategy Development

VIII. Target Market Analysis

IX. Alterative Selection

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Four Strategic Priorities in 2006

(1) Widen distribution network

(2) Increase market share of the premium

cookware segment

(3) Preserve prestigious image

(4) Continue to capture revenue growth of at

least 15%, while maintaining pretaxearnings of $12.5 million.

Objectives

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Most Imperative Goals

Determine if a price promotion is necessary.

Develop the details of a marketing strategy that is

consistent with the companys overall strategic

objectives.

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Constraints

(1)The preservation of brand equity

(2)Perceived negative impacts from the

2004 price promotion

(3)Highly selective distribution channels

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Financial Condition

Total Market Revenue2006

3.10%

96.90%

Culinarian

Cookware

Competition

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Financial Condition

Annual Revenue Growth

25.97%

18.96%

4.59%

21.04%

0.00%

5.00%

10.00%

15.00%

20.00%25.00%

30.00%

2003 2004 2005 2006(E)

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Management Philosophy

Paternalistic

Positive: Two-way communication, whichmotivates workers.

Negative: Slows down the decision making

process.

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Organizational Structure

Structured by Function

Positive: Makes efficient use of specializedresources and makes supervision easier.

Negative: Difficult to get quick answers,

determine accountability, and may be difficultworking with other departments in a unified

way to achieve the organizations goals.

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Organizational Structure

Chief Executive Officer

Audrey Roux

Vice President of Marketing

Donald Janus

Senior Sales Manager

Victoria Brown

Culinarian Cookware

Organizational Chart

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Organizational Culture

Pride. Pride in having unparallel product quality,most advanced performance technology, and strong

dealer support.

Built on brand equity. Every decision takes intoaccount the preservation of Culinarians prestigious

name and image.

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Culinarians

Strengths and Weaknesses

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Potential Resource Strengths andCompetitive Capabilities

Clear strategic direction.

Core competencies in quality and performancetechnology.

Strong brand name image/company reputation.

Stronger dealer relationships than key rivals. Leader in metallurgy technology.

Proven product innovation capabilities.

Good management philosophy.

Employees are motivated.

A strong financial condition.

A distinct competence in utilizing internal and externalconsumer research.

Business decisions are highly scrutinize beforeimplemented.

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Potential Resource Weaknesses andCompetitive Deficiencies

Weak advertising and promotion.

Losing market share because of

attachment to brand name image.

Flawed data analysis by a third-party

consultant.

Limited distribution channels.

Management is cautious to pursuebolder price promotion.

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Implications for Strategy Development

The preservation of brand equity could preventCulinarian from considering a price promotion,fearing that it would cheapen the products

image. Perceived negative impacts from a price

promotion offered in 2004 are heavilyinfluencing the decision; however, in reanalysisit may be found that the promotion was in fact

beneficial. The company is very selective in how

merchandise is distributed, which limits themarket in which the products are sold.

Weak advertising and promotion policies.

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Target market

Men and woman between ages 30 to 55,

With a household income of 75k +

The group tends to care more about what the product

can do rather than how it looks.

A large likely hood of watching cooking shows and then

purchasing cookware with familiar names of cooking

celebrities or brands used by those seen on shows.

Consumer wants to compare brands and products

Want to have the biggest bang for their dollar.

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Brand Extension

Strategic Alternative Selection

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Brand Extension

Benefits: Would be able to offer other premium culinary

products to complement their cookware

Use the new support products as gifts during

promotional events Increase the prestigious brand image

Costs:

Would need to understand:

What materials would be needed

How to produce new products outside their expertise

How to market the items