Zoecon Corporation: Insect Growth Regulators Case Study Essay

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Zoecon Corporation: Insect Growth Regulators Case Study Problem The problem of the Zoecon Coporation at this moment is how they can best allocate their technical, financial, and marketing resources for their IGR compounds. Some executives have suggested an informal consumer market expansion with their Roach Ender product to 19 cities, concentrate on the pest control operator (PCO) market with the Roach Ender, or sell its IGR compound to firms actively engaged in reaching the consumer market insecticide market. Some of these suggestions/alternatives are mutually exclusive and some are not, therefore Zoecon Executives should use the test market data analysis, in addition to their experience and knowledge in the insecticide industry to…show more content…
More of the pros of this consideration are that projected annual increase of sales is 10 percent and the product will hold a high profit margin due to its premium price compared to other products. These 19 cities are the same cities where Flea Ender was introduced, therefore consumers are familiar with the Strike product. The major negative of this alternative is continual loss of profit similar to Flea Ender. As stated earlier, after two years on the market, Flea Ender was still not profitable even though they had an 18% market share. The second alternative would be to direct their resources to the pest control operators. The projected annual sales increase for this market is 8 percent, which is a little less than that of the consumer market. Zoecon had their product Gencor (hydroprene) well received by PCO’s in 1984, therefore the consumers will have a positive view of a new product line from the same brand. A yearly investment of $500,000 per year above the 27% of sales will be budgeted for trade advertising and sales efforts to accelerate sales. The third alternative would be to enter into an agreement to sell hydroprene with a 3rd party manufacturer (d-con Company, S.C. Johnson and Son, and Boyle-Midway Division of American Home Products) where all
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