Dow Corning

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EXECUTIVE SUMMARY
Dow Corning is a global leader in silicone-based products. It sold its products to more than 80 countries globally and has a 40% worldwide market share in 2006. Its success to date was a large part driven by a major marketing initiative that revived the company half a decade ago, the launch of dual brand strategy and the resultant launch of the Xiameter brand. The Xiameter brand was an instant success, but is now experiencing challenges from increasing competition.
This paper will discuss what caused the decline of Dow Corning to force it to introduce the Xiameter brand. It will then discuss one major change that complemented this Xiameter brand and it was the change in customer segmentation scheme. The report to
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Dow Corning was probably lucky this happened more than a decade ago, if it happened in the increasing competitive market today, the company would have struggled a lot more than it did.

THE NEW CUSTOMER SEGMENTATION AND ITS BENEFITS
Dow Corning success to date is driven by its relationship with customers. A lot more could be achieved through this relationship by further understanding the customers and this is exactly what this new needs-based segmentation scheme was able to achieve.
Dow Corning previously believed industry groupings were the most ideal way to serve its diverse customers base, but it was with this new needs based segmentation it revealed more about its customers and improved the way customers are served.
Firstly, exact needs of customers were revealed with this new segmentation method. While Dow Corning certainly would know its customers before this segmentation change, but because previously segmentation was done by industry groups, Dow Corning would approach its clients with the mindset on “what does the industry need”, and not “what does the customer really needs”. For example, under the Innovative solution segment, these customers are pioneers in their respective markets, they are the trend setters, and the silicone products that were used and sold by Dow Corning to the industry at present would not meet its needs. What these customers really need from Dow Corning is joint R&D, the service and expertise,
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