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Ccm Hockey: Relaunch of U+ Pro Skate

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1. What is the major decision facing CCM? What is the timeline or sequence of events leading up to the decision?

2. What is your evaluation of the external environment, industry, and competition?

3. What is the position of CCM in the marketplace? What is your evaluation of the new product development" prototype and market testing" process used by CCM?

4. In light of the customers and their behavior, and your previous analysis, how would you position the U+ Pro skate in the marketplace?

5. What recommendations would you make to CCM regarding the execution of their launch strategy for the U+ Pro?

Notes

* The major decision that CCM faces is one that involves the development of an effective product launch strategy which will boost the sales for the re-launch of CCM's U+ Pro skate. This has been due to the fact that 'a number of quality and marketing missteps had occurred since the market introduction of the U+ Pro skate two years earlier'. In addition to this, the hockey equipment industry has been facing flat sales as of late. - Major decision

* Skates make up the largest (34%) portion of global hockey equipment market by category, followed by sticks - Exhibit 2.

* Key competitors are: Reebok-CCM Hockey, Bauer Hockey, Easton, and Graf. - Competition in the industry

* The industry was an expensive industry in comparison to other sport equipment industries like soccer. - Threat of substitutes high

* The consumers of hockey equipment belong in mid-high income brackets, and spend quite a bit of money per annum for equipment. Hence, after they buy the equipment, they tend to stick to it and try to avoid repurchasing. - High power of buyers

* Had variety of distribution channels within the industry. Among them the independent retailers had the best knowledge and tradition associated with selling hockey equipment. In addition, they are part of buying groups that spread across the country in Canada.

* 3 consumer segments:

o Personal Expression and Performance group (49%): concerned with image, product and personal performance, brand reputation and brand popularity. Want a brand that reflects style and personality. Price was not a barrier. Responds well to NHL endorsements.

o Smart performers (45%): rational decision makers who consider both value and product performance when making a purchase. They want equipment to help them outperform the competition while staying within a budget. Didn't care about NHL endorsements.

o Price Conscious Consumers (6%): price is the most important factor.

* CCM positions itself as a high quality product with emphasis on the hi-tech functionality of the products. The tag lines suggest a sense of evolution and betterment that CCM equipment provides for the users. Communicated through hockey publications, and online media, and TV in certain markets only. Might want to increase TV communication?

* Competition

o Reebok: Reebok and CCM are both owned by Reebok International. Had high visibility and credibility. Associated with high profile player like Crosby. Real presence in head-to-toe and goalie. Positioned itself as the technology brand, and for players who are success driven. Tag lines suggest ability for its products to evoke empowerment within the user. Had well rounded communication strategy.

o Bauer: Goalie and head-to-toe equipment. The purchase of Bauer by Nike did not help as the 'Boss' category see Nike as more of a basketball, apparel company. However the Bauer brand of skates is a hit due to benefits in marketing efforts and associations with Nike. Positioned at the high end of the market. Style and long lasting. Used diverse media and HEAVY use of endorsements. Tag lines suggest enhancement of in-game performance and attributes that can help players reach success.

o Easton: Head-to-toe brand. Small market share, more known for their sticks. Positioned as proven, and innovator in stick technology. Did not use TV, instead use publications, and online media.

o Graf: Relied mostly on word of mouth for communication. High-end skates only. Skates were their main products. Minimal presence online. NO social media, TV or publications.

* Sequence of events leading up to decision

* In the Fall 2007, CCM launched the new U+ Pro Skate. Believed to be the next generation of hockey skates.

* Followed the power-triangle approach in marketing these skates: Product innovation, pro validation, and marketing communications.

* The competitive advantage they had was the U-Foam which had the ability to take unique shape of each individual foot.

* CCM took aggressive marketing actions and pushed its product through. However, the skate started experiencing quality issues.

* Durability issues. Customers were frustrated at the short-term durability of a high-end skate retailing at high price of $649.99

* Due to this, CCM lost the support of its independent retailers.

* In order to fix this, CCM initiated a re-launch of the U+ Pro skates, and invited the retailers back to Montreal, this time however, focusing on product knowledge. Educated this knowledge through U+ University.

* Kept the look of the new U+ skates the same as the old.

* The problem lied with CCM deciding to launch the skates in the fall

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