Vector Marketing

Vector Marketing is a subsidiary of ALCAS Corporation and markets the cutlery products in North America. The company’s sales have increased at 5% but the management is convinced the performance is below par and there is a need to improve the existing marketing strategy or even adopt a different marketing strategy. Some of the issues available include adopting e-commerce, the emphasis to be put on international marketing and domestic marketing and whether to expand the product line. This work will offer an in-depth analysis of the Vector Company and offer recommendations in increasing the volume of the sales. It is also worth noting that this case study will also refer to its competitors and their marketing strategies.

Background

Alcas corporation is the parent company to CUTCO Cutlery Corporation, Vector marketing, CUTCO International Inc and KA-BAR knives. As a subsidiary of the ALCAS Corporation, Vector marketing is charged with the responsibilities of selling the cutlery products in North America. Currently Michael Lancellot is the CEO of Vector Sales North America while Erick Chairman is the Chief executive officer of ALCAS Corporation. The corporation is also doing fine and this is evident from the record sales being registered. However, with a record increase of only 5% Michael Lancellot is convinced that some measures needs to be taken to increase the sales.

The CUTCO international sells the cutlery in the international markets in Australia, Costa Rica, Germany, Korea and Puerto Rico. On the other hand, CUTCO Cutlery is in charge of the manufacturing the cutlery.  The final subsidiary, the KA-BAR knives deals with sport and utility knives.

Currently, the ALCAS Corporation sells its products directly to its customers. However in 1940s to 1970 the company used small and independent distributors. In 1985 the company acquired Vector Marketing Corporation which had a wide distributorship network. The Vector Marketing uses independent contractors in selling the cutlery items and who are paid on commission basis. These representatives are students who are recruited during the school vacation. But there is a need to increase the sales volume and this leads to the evaluation of the direct selling method.

Strengths and weaknesses

The cutlery products are manufactured exclusively by ALCAS Corporation and have been successful in eliminating the outsourcing the production of components. This has been instrumental in ensuring that the quality of its products is maintained. Although ALCAS Corporation has a broad product line it has managed to ensure its product meet excellent quality standards. For instance, CUTCO cutlery is recognized for its quality products such as wedge-lock handle and Double-D knife blade grind. The wedge lock is ergonomically designed and is comfortable to handle. Similarly, the Double-D knife has enhanced features that make it comfortable to use. Indeed, Anderson (2005) argues that the customer value proposition should have characteristics such as good quality of products, a broad product line and innovative product. Vector Marketing lives to this proposition and is able to depend on referrals due to high quality of its products. The company maintains a good relationship with its customers and this is illustrated by the product-replacement system where defective cutlery items are exchanged at no cost to the customer. This is one strategic option besides the customer intimacy (Bijmont & Tammo, 1996).

The Alcas Corporation made a wise decision by acquiring Vector Marketing Canada which at the time was the biggest independent distributor. This move was helpful in accelerating its international expansion pace. With the unsuccessful Vector marketing approach in North Korea the company changed its recruitment approach which increased the sales. The decision to create CUTCO international to deal with the international markets was also another important decision. Global strategies involve creating global associations in order to obtain scale of economies (Cooper, 2000). Such strategies also enable businesses to enjoy the national incentives while accessing cheap labour and materials (Day & Wensley, 1983). This could explain a huge contribution of Vector marketing to the total revenue to ALCAS Corporation.

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