Zenith Electronics Corporation Case

Zenith Electronics Corporation, an American based company, manufactures color televisions, color picture tubes, color computer monitors, cable products and hi-tech electronic components such as monochrome displays, power supplies and automotive electronics. The company was gauging the possibility of entering into new frontiers with High Definition Television Technology i.e. HDTVs.

The benefits of switching from their traditional CRT technology to HDTC technology meant that they could provide a higher resolution with superior digital stereo sound to their consumers. In 1987, only twenty companies manufactured color TVs out of which two were US based. By 1990, Zenith was the only US based manufacturing company for Televisions. The company saw record sales accompanied by low margins. This made the company's executives look for ways of marketing the HDTVs.

EIA or Electronic Industries Association defined High Definition as picture resolution or the number of horizontal or vertical lines scanned on television. HDTV technology had twice the number of lines as given by the NTSC standard thus providing sharper images and a better viewing experience. On the other side of the globe, governments in Japan and Europe were launching projects to develop HDTC systems.

Zenith was conducted researches on advanced picture tube technologies and HDTV broadcast systems. It developed the flat-faced CRTs, which provided a higher resolution than curved screens. Zenith increased its investment in HDS research, from $1 million to $10 million and estimated that on an overall, it would invest $50 million in R&D on HDTV displays. The Vice President of Marketing at Zenith, Mr. Bruce Huber, was considering conducting market research to determine current consumer preferences. The methods of research could be broadly divided into Quantitative(Conjoint analysis, cluster analysis) and Qualitative(one-on-one interviews, surveys, focus group discussions). The different analysis's conducted were Aspect Ratio study and Conjoint Analysis. By the end of Zenith was able to successfully forecast the demand. They relevantly collected the data. We suggest the use of secondary research along with a successful Aspect Ratio Study.