Sealed Air Corporation, Essay Example

What should Sealed Air be trying to accomplish in any decision it makes in response to the GAFCEL threat?

Sealed Air should present an uncoated bubble for the following motivations:

The introduction of uncoated bubbles can facilitate Sealed Air to keep the clients who have the requisite of using the uncoated bubbles. It is apparent that GAFCEL’s capacity of increasing its sales volume at the pace of one million dollars annually with less than two sales people in the New York marketplace was a forecaster. The event of GAFCEL accomplishing this category of sales volume demonstrated that they are a viable competitor for the market share that Sealed Air Corporation is trying to maintain. The presentation of uncoated bubbles would have had the requisite of little additional investment with regards to research and development. The cost had been one of the competitive benefits with regards to its market position with GAFCEL (Nolan 21).

The distributors had the requisite of maintaining inventories of Air Cap coated bubbles. In the event that Sealed Air Corporation did not supply the AirCap bubbles, the distribution network members had the potential of distributing GAFCEL’s products. This had been detrimental to Sealed Air Corporation’s market position (Nolan 21).

What has been happening to the market and how is Sealed Air doing?

Sealed Air Corporation had been maintaining a robust annual growth index of twenty five percent in its net earnings and net sales revenue during the period that spanned from 1972 to 1980. Sealed Air Corporation had been a technological leaders who maintained itself at the forefront of the market. During the decade which covered from 1970 to 1980, the organization constructed its production on the first cell cushioning material that had a lightweight quality. In addition, Sealed Air Corporation brought the first stationary foam packaging assembly system and provided the research and development of the initial solar thermal heating swimming pool system (Nolan 23).

Considering the market for insulated and protective packaging, the product which had been promoted by Sealed Air Corporation which is designated as AirCap has the characteristics of differentiation. This differentiated feature which was designated as barrier coating becoming one of the major forces that motivated the clients to purchase Sealed Air Corporation’s products for the decade of the 1970s. Consequently, Sealed Air Corporation had become able to create added value for its clients. This added value was achieved by instilling an elevated level of technical quality in the coated bubble line. In addition, Sealed Air Corporation educated its client base with regards to the benefits of its bubble products. The education was conducted by the sales staff.  The sales staff applied a consultative selling perspective in order to increase its sales revenue and market share (Nolan 24).

Furthermore, the Sealed Air Corporation aggregated value to its distributors by causing their products to become known for quality. This quality enabled the Sealed Air Corporation to acquire brand equity for its products. The Sealed Air Corporation also applied a distribution policy which was selective. The selective policy of distribution facilitated less competition among the wholesalers and retailers. As a result, the profit margins of the retailers and wholesalers was optimized (Nolan 24).

Should Sealed Air introduce an uncoated product?  What are the pros and cons?

The presentation of uncoated bubble products would not be very effective in the domestic marketplace. The uncoated bubble protection never attained more than 15% of the total sales volume. Sealed Air Corporation is a leader with regards to the barrier coating technology field. The uncoated bubble products would be perceived as a product which has a less robust quality. This would contradict the brand equity that had been accrued by the organization. In addition, the introduction of the uncoated bubble product would have contradicted the cost effective perspective that the organization had promoted (Nolan 26).

The sales force had been educating the consumers for more than ten years with regards to the coated bubble products that were promoted by Sealed Air Corporation. The segment of the market that had been acquired by GAFCELhad been previously held by Astro. Furthermore, the sales revenues for the uncoated bubble products were not spectacular. These sales revenue margins totaled to approximately fifteen percent. The change in product would have contradicted the organizational philosophy of Sealed Air. Sealed Air has been promoting cost effectiveness and quality for more than ten years (Nolan 22).

In comparison to the domestic market, the introduction of new competition in the European venue appeared to the possibility of causing a greater influence. The European consumers had not received the decade long education that the American consumers had been delegated with regards to the quality and the cost effectiveness of the coated bubble products (Nolan 23).

As a result, the European consumers were more interested in the price of the consumable. In Europe, the expansion of Sealed Air Corporation into the uncoated bubble production line would have less detrimental outcome on its organizational perspective. If Sealed Air did not optimize its potential in the European marketplace, the potential of losing its market share to Sansetsu in the United Kingdom would be a reality. The loss to Sansetsu could accumulate to as much as half of Sealed Air Corporation’s market share. Sealed Air Corporation possessed a minimal subsidiary in France and Germany where it held a minimal market share. Sealed Air Corporation was in a position to effectively compete with the European producers and gain a larger market share with minimal investment (Nolan 23).

If Sealed Air introduces an uncoated product, which marketing programs would you suggest?

The marketing planning should have been conducted with regards to a differentiation perspective. The differentiation perspective should have been maintained between the uncoated bubble products and the coated bubble products. Sealed Air Corporation should have maintained the present brand equity situation. The brand status had been enabled for the coated bubble products in the United States. The uncoated product had a sales revenue margin. The Sealed Air Corporation should have maintained the perspective of presenting the coated bubble products.

In regards to the customer base, the organization should have supplied supplementary services to the coated bubble market base. This would have included distinctive packaging for the different quality grades of coated bubble products (Nolan 27).

The emphasis on the distinct grades of product and their characteristics would have caused the competitors that wish to gain entry into the market to consider the different grades of product in their presentation. This would have caused the initial entry to become more difficult for the competitors. Another perspective that would have been recommended for the Sealed Air Corporation is to differentiate the products by using distinct brand names. In the event that the organization would have continued with the present brand name, it may have caused some confusion with regards to the Sealed Air Corporation‘s production line. There may have been some dilution of the brand equity that may occur in the introduction of the uncoated bubble products line in the domestic market. This challenge could have been remedied (Nolan 28).

The remedy would have been to use a distinct brand name for the uncoated bubble products line. In the use of a different product name, the brand dilution and confusion that would have occurred with regards to the education that had been previously received by the clients would be kept to a minimum. The product differentiation could have also involved changing the color or the shape of the uncoated bubble products. The product differentiation would have caused the distributors and clients to become conscious of the different products and different applications (Nolan 29). In this manner, the introduction of the uncoated bubble products would not have hurt the accrued brand equity of the product. The final recommendation would have been to change the product name, color and shape for the uncoated bubble products.

If Sealed Air introduces an uncoated product, what sales arguments would you use with existing and new customer?

The argument that should have been presented is that there are different products that can be used for different applications. Considering the products which had been expensive and fragile, which would include technologically based products, the uncoated bubble protection would have been suggested.  In consideration of the clients who wish to protect items which have a less fragile nature and expense, the uncoated bubble product would have been presented. The uncoated bubble product would have provided a cost benefit in this area. The packaging products were perceived as expendable commodities in the European marketplace.

Furthermore, the Sealed Air Corporation should have directed its attention toward the uncoated products with regards to the Europeans. The European consumers had been demonstrated to be more sensitive with regards to the price characteristics. The Sealed Air Corporation should have formed strategic alliances with some of the European distributors. This could have been realized instead of relying on salespeople in the European marketplace to educate the clients with regards to the benefits of the uncoated bubble products. In addition, the Sealed Air Corporation should participate in the trade shows and direct mailing in order to increase the market share of smaller businesses.

Work Cited

Nolan, Robert J. “Sealed Air Corporation.” Harvard Business Review 9-582-103(1982): 21- 36.26 July 2015. https://cb.hbsp.harvard.edu/cbmp/pl/37249310/37249316/308cdd679a5b9dda99fa3c90d5bbd3aa