Problem Definition
The Jones Blair Company is a privately held corporation that produces and markets architectural paint and OEM materials to various markets under the Jones Blair brand name. Currently, Jones Blair Company does its business in the eleven county Dallas-Fort Worth (DFW) and Oklahoma, New Mexico, and Louisiana. The company’s consumers are made up of do-it-yourselfers (50% of sales) and professional painters (25% of sales). Jones Blair’s’ products are the highest priced in the marker due to their efforts if having top quality products. The senior management executives of the company must decide on a method on how and where to apply marketing efforts among the various architectural paint markets in the service area. The problem arose from the company’s paint gallonage being stable in the past five years and reaching a threshold in their prices.
Market and Industry Analysis Architectural coating accounts for 43% of total industry sales, making it the largest segment in the paint industry. According to Exhibit.1 in the case, the do-it-yourselfers painters first choose the store and then the brand while contractors look for good quality products. Therefore, a widespread distribution is important in this industry. There are 600 different competitors in the industry, most of them spending more on advertising and offer less expensive products compared to Jones Blair. The company has had a constant annual increase in sales; however, the sales volume has remained constant. Jones Blair spends 3% of net sales ($12,000,000*.03=$360,000) on advertising reaching only 25% of their target audience when they need to reach 30% for it to affect sales. Of this 55% is spend on the cooperative advertising programs ($360,000*.55=$198,000).
Evaluation of Alternative Courses of Action The senior management has come up with several solutions on where the company