CASE STUDY: PEAK SEALING TECHNOLOGIES (PST)

CASE STUDY:
PEAK SEALING TECHNOLOGIES (PST)
Avenge
rs
Positioning Grid of PST and competitors
Price
SD
-72
High
LD-48; RD48; HD-48;
RD- 72; HD72; RDS-72;
HDS-72
This graph shows that PST
is facing new competitors
which entered the low-cost
segment and can pose a
threat for RD-48 and RDS72 products in the future by
attracting price-sensitive or
insecure costumers.
GP48
Ipac
Tensile
New
PST?
Low
Low
High
Quality
Research question:
Should PST respond to the rising competitiveness and therefore enter the economy
grade segment or stay the course with advanced technology, high-quality products?
1
ASSESSMENT OF STRATEGIC OPTIONS
Implications
for:
Entering the economy grade
segment
Avenge
rs
Following quality leadership
strategy
+
Ability to fulfill needs of pricesensitive customers
+
Consistency of company image 
quality leader
-
Change in perception of being a high
quality leader
-
Loss of market share  not targeting
price-sensitive customers
+
Possibility to offer a low-end PST
product
+
Clearly positioned products, no need
for adjustments in distribution policy
-
Even wider product range
-
Low-price offer only from competitor
not from PST
+
Ability to offer more variety in terms
of price levels
+
Consistent and easy product quality
marketing
-
Higher effort to explain product
differences
-
No ability to offer solution for pricesensitive customers
+
No positive impact
+
Consistent overall brand image
-
Negative impact on overall brand
image, reputation loss
-
No negative impact
Customers
Distributors
Sales force
Brand
2
SOLUTION
• Development of a new brand to avoid negative image
effects on PST high quality brand
• No visible connection between the brands for the
New brand customers
Product
launch
Enter
market
+
+
+
Avenge
rs
• Development and launch of two new products to
compete with Tensile
• Competitive pricing strategy (similar to Tensile)
• Enter the economy grade segment and make use of
well established distribution network
• De-clutter existing product line by eliminating HD-48
and HD-72
No brand image loss for high-quality products/brand
Ability to target and acquire price-sensitive customers with new brand
Higher sales volume due to marginal possibility of product cannibalization
3

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