1. As Charlie Ferguson, P&G’s European VP, would you authorize Wolfgang Berndt’s third request to launch Vizir in Germany?
I think Charlie Ferguson should Launch Vizir in Germany, but not after only four month of testing. I would recommend Charlie Ferguson to wait for final test-market results to launch Vizir in Germany. He could even rethink and make possible changes on the strategy of Vizir in Germany accordingly to final test results.
The biggest reason for Berndt and the German group to recommend pushing the lunch date for Vizir in Germany is the concern of possible preemptive strike from Henkel. Sometimes it is important to be the first in the market—being the first company to enter HDL market segment allows the company to gain control in the market. First mover advantage also allows companies to gain up scare resources such as higher brand recognition and brand loyalty. However, be the first doesn’t always work well for the company, since being the pioneer means higher cost and risk, especially in this case, when the marketing research for the new product is insufficient.
One should always make decisions after getting statistic support from marketing research. The cost developing a new market for HDL has already been substantial. It will be a big risk to spend all the initial capital to a product that has no history to look to and no marketing statists to follow. What if there really is no market for HDL in Germany? P&G will face an even bigger lost (additional $1.5 million in capital investment and $16 million in marketing costs).
Even if Henkel is planning on launching HDL, P&G still should not be ashame to be second. If it were proven by Henkel that the market doesn’t exist, it would save tons of money for P&G. If the market exists, P&G can learn from their success or failure – maybe the marketing positioning was not right, or the price is too high, or maybe their packaging is a huge success. Their performance will be the free lessons for P&G...