Marketing
"North American Philips Lighting Corporation:
Project shopping Cart"
The Project Shopping Cart by the North American Philips Lighting Corporation was a disaster. The project was supposed to introduce the new Norelco light bulb to the market. The Norelco's product mix was suffering at this time and needed to find a way to improve it gross margin, but the project did not help. The projects goal was to get the light bulbs in grocery and food stores under the Norelco name.
The director of marketing for the North American Philips Lighting Corporation (NAPLC) was John Hays. John Hayes worked for the Westinghouse Electric Company for 12 before taking this project on in 1978. Everyone from the marketing department to upper managers thought the program was going to be a huge success in introducing the Norelco light bulbs to the grocery store area. When the shopping cart project was started in 1978 General Electric was the main supplier, and in 1981 GE was still on top the Project Shopping Cart was thus a failure.
English: Book engraving of Westinghouse Electric C...
English: Head office of Philips at Amsterdam FranÃ...
English: Some new old stock Royale light bulbs mad...Hayes was not sure why the plan failed, and was unable to figure it out for weeks after.
What was wrong with the company's ideas, well when you look at the company's statistics, you notice that the brand name is a dollar cheaper and the suggested retail is 10% less than going with the private label. Also in 1976 the grocery store segment dominated the department stores, hardware and drug stores with 57% of the market. However in 1977 the market was slowly changing, the grocery store segment had declined to 54% and eventually to 49% in 1981. The competiti62% on was also very fierce. GE controlled about 62%, while Westinghouse had 26%, Sylvania at 10%, and Norelco had about 1.3% of the market share,