Compaq case

Compaq Computer: Consumer Notebook Group& Focus Groups
1. Describe the situation of Compaq in the USA market in 1995. Why haven’t they had so much success in the consumer division?
Compaq Computers were one of the world’s top computer manufacturers. They had an 11% share of the consumer computer market overall, the new consumer desktop line, the Presario, made the company jump to a 17% of shareof the retail market. This company used Intel processors and novel construction models. The company offered the same PCs specifications as rivals for lower prices.
Compaq was a product-oriented organization the Desktop, Servers and Notebooks instead of focus on the final consumer and the uses ad functions required. They reorganized the business model and turn focused on this markets: Home,Business and Enterprises.
2. Which are the decisions that Rod Schrock has to make when he becomes the vice president of the new Consumer division?

• Whether leave the notebook market and concentrate on desktops’ for the consumer market.
• After require a marketing research, he wanted to get information to decide: if the laptop market exists, is it profitable? Should Compaq develop a product toget into this market?
• Once received the marketing research. Schrock has to decide if the information based on surveys from International Data Corporation, the engineers and the Retailers are enough, or more important, are suit to decide whether launch or not a new laptop.
• Approve or not the Greg Memo’s decisions of continue, changing, modify, stopping the production of the Shark model Afterstudy the focus group delivered at the last minute

3. Which are the objectives of the Marketing Research that he ordered? What information does he need to take the decisions with which he is confronted.
The objective is to investigate the laptop market and develop a product that can sell a lot in this market.
To develop a new laptop he needs to know:
• Market size, potential, context andfeatures of the technology.
• Information of Competitors, Channels, Consumer and Compaq capacity to develop the required laptop.
• Because it is a new market and its in evolution, gather data to understand the behavior of the consumer and define the segments existing.

4. Analyze the focus that is used to obtain that information.
The root of the information required by Schrock is that Compaq isjust turning is focus in product to a Market based strategy. The focus is recent and there is still a gap between the knowledge of the final consumer, his behavior and attitudes, and the market(s) to which he belongs.
Schrock is still trained in the product, so he asked the engineers for features that users value: size, weight and battery life. Yet, is an internal perception of an unknownmarket.
Also, he asked the retailers for their opinion and the indicated that the main characteristics of the new line should be: Reliable product, reliable supply and reasonable pricing. It’s a closer look of the consumer needs, but still it has not the sufficient insights to develop a new laptop.
Although, the all market and his potential were studied, the approach wasn’t enough to prove theacceptance or rejection of a new laptop.

5. Do you believe that the decision to approve the new model Shark was well founded?
I believe it wasn’t well founded. There is a line of the case that states: ¨Based on the data gathered from the engineers and retailers, Memos team designed a consumer notebook. Code-named Shark¨. How based on a perception of engineers and retailers are going to build, designand develop a notebook for consumers. The information gathered is complementary, but this is a big investment for Compaq and requires a complete investigation of the market of notebooks, and the final consumer provides this.
6. Which is the product concept of the new Shark model? (In other words, what benefits is the new Shark model covering?).
The features that they thought consumer would...