Shanghai Highly (Group) Co., Ltd. is a developer and manufacturer of home air conditioning compressors and other related products. In 2013, the annual production capacity for its main products (home air conditioning compressors) made impressive advances globally. However, intense competition among air-conditioning manufacturers has led to a reshuffle among manufacturers of home air conditioning compressors. As a company focusing on manufacturing home air conditioning compressors, Highly has lost its dominant position in the market, and its return on investment has hovered around 6% for years. To achieve better performance, Highly must address multiple challenges and questions. Should the company begin producing complete air conditioners? Should it expand production capacity for its home air conditioning compressors? How can Highly solve problems like high labor costs and fluctuations in raw material prices? After returning from a visit to Japan, Highly’s chairman, Mr. Shen Jianfang, must now consider these very issues.
The outbreak of SARS in 2003 panicked many Chinese people. As an unexpected result, health supplement products suddenly received much more interest than before. Among a variety of health supplements, multi-vitamins became especially popular, as they were said to be critical in enhancing people’s immunity, effectively preventing one from catching SARS. Goldpartner, a late comer to the multi-vitamin market, became the market’s sales leader after two years’ effort. Goldpartner had achieved great success since entering the market but also faced a number of problems and challenges. Case A of this case series aims to discuss the positioning problems facing Goldpartner when it first entered the market at the end of 2001. Case B explores how, after its second round of market testing, Goldpartner targeted three market segments and invested a lot into advertising — yet sales dropped sharply after peaking during Chinese New Year in 2003. Case C discusses Goldpartner’s strategy to create a point of differentiation that riled up its competitors, and the hard decision of how to balance the three segments. Case D describes how Goldpartner was aware of some insufficiencies in the marketing, and aims to figure out how Goldpartner should adjust its marketing strategy to fit in the new environment and maintain its market position.