Ambassador Torchlights

AMBASSADOR TORCHLIGHTS

Introduction

Ambassador Torchlights were the second largest in the market for dry cell batteries and allied products. Having a good distribution network, the company wanted to utilize this strength by taking over the distribution of some consumer items.

Facts

Their national network of distribution comprised of 80000 retailers and stockists. They also had a large fleet of vans which serviced the rural sector. Ambassador Torchlights adopted the policy of 'follow the leader' which was United Battery Manufacturers. They had marketed their private brand of blade known as 'Best' with moderate success. Ambassador Torchlights contacted Central Industries which had 2 brands of blades - 'Splash' which was made of Stainless steel and 'Awake' which was made of Carbon steel.

Aggressive marketing by Central industries had achieved first time buying by the consumer; however they could not sustain the sales. This was attributed to the fact that the company had received complains by the users that as many as two out of the five pack of blades were faulty.

Central industries accepted the proposal of Ambassador Torchlights for the distribution of its blades, but laid down a clause that they would terminate its contact they were not satisfied with their performance.

Problems

1)Ambassador Torchlights could either opt for the distribution of their own private brand or they could take over the distribution of Centrals brands 'Splash' & 'Awake'.

2) If they marketed their own brand, how should it be positioned?

3) If they marketed Centrals brands, they needed to know why the repurchase rate was low.

Questions

Should Ambassador Torchlights take up distribution of blades? If yes, should they go in for their own (private) brand or should they take up one or more of Central's brands?

Solution: Ambassador had a good network of retailers and stokists and dealer push is important for blade sales. They also have vans catering to the rural areas. These can be of good help to distribute in urban and rural areas. Moreover, there is competition in the blade market as brand loyalty among blade users is very low. Hence ambassador torchlight's must take up the distribution of blades.

Ambassador should opt for their own private brand as manufacturing and marketing their own brand after they have already undertaken the distribution of Centrals brands would be difficult. Aggressive marketing of the Centrals brands had achieved a very high level of awareness and trial user ship for both these brands however repeat purchase was very poor. Moreover if ambassador torchlights took up the distribution of these brands they would have to undertake an agreement according to which central industries could terminate them as selling agents if central industries were not satisfied with their performance. Hence even though if they did a good job and achieve some success there was no guarantee central industries would not one day express dissatisfaction with their performance terminate them and then cash in on their fruits of labor.

What are the product positions of the major brands? Is there an attractive product position available where Ambassador could introduce its brand?

The