Soren Chemical

When the initial annual goal of $1.5 million was set, it seemed to be realistic. Of the 9 million residential pools in the United States, 80% maintain their own pools providing 7.2 million pools in the market who are maintained by the owner. Additionally, the other 20% who do not maintain their own pools use some sort of service professional, and while they are not purchasing cleaner on their own, these 1,800,000 pools are still using clarifiers and these too are still potential customers. With around 60% of the clarifier market share occupied by Keystone, Kymera and Jackson Labs, 3.78 million pool owners are using the big three products. This leaves 2.52 million pool owners not currently committed to a brand.

The target of $1.5million USD (6.25% of the total market or 16% of the remaining 40% market) is a lofty goal; but, given Coracle's Points of Difference, it is realistic that they could have achieved it. However, the fact that they have only reached $111,000 over half of the selling season means it is highly unlikely that that Soren Chemical will make the goal for the rest of the year.

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--> Starting with the distribution channel structure described in the case study, there are too many avenues in which residential pool owners can receive Soren. Residential pool owners can obtain through mass retailers, pool specialty retailers, or pool service professionals. While 20% of these retailers have their pools serviced by one of the 40,000 to 50,000 pool contractor and service companies, the other 80% are purchasing through mass retailers or pool specialty retailers - both of which are taking a 15% gross margin. Therefore, Soren needs to sell exclusively through the one retail distributors who owns the higher customer base. Soren will then negotiate a smaller gross margin upcharge in exchange for the higher volume the exclusive retailor will realize.

Soren Chemical is struggling to sell Coracle for a multitude of reasons. Soren's lack of experience in marketing and selling consumer products hinders their ability to inform pool users on Coracle's safety and cost-savings benefits. Coracle needs to inform individual pool owners that maintaining their pool is not just about chlorine and filters. If Coracle were to come out and be the first to inform the masses about the complex system of pumps, chemicals, and UV or ozone technology they would have a leg-up on their competition. Of course, Coracle would need to package this in a concise and easily understandable format. Pulling this off successfully would make the competition appear less knowledgeable. Without any of this, Coracle is just another product that is not differentiated from the other pool cleaners and does not own the lowest price point. When was the last time you chose that product?

The difference in the selling process