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Cummins Crosspoint Kinetics: Positioning and Launching the CK3000 Hybrid Engine

Daniel H. McQuiston
November 1, 2015
SKU:
BUS-004814
Region: 
North America
Topic: 
Strategy & General Management, Marketing & Sales
Length: 
11 pages
Keywords: 
new product introduction, Segmentation, market segmentation, Targeting, Positioning
Copyrighted by: 
Journal of Case Studies
Student Price: 
$4.00 (€3.74)
Average rating: 
0

Cummins Crosspoint Kinetics, a division of Cummins Crosspoint, the Cummins Engine distributor in Indianapolis, Indiana faced a thorny problem. The company had developed the CK3000 hybrid engine which could be installed on either new or existing shuttle and/or transit buses. However, there had been a number of product failures and company bankruptcies of similar products, so Crosspoint Kinetics had to overcome those negative perceptions. In addition, while the product had been affordable on new buses due to government subsidies, there were no subsidies for retrofits, making the product almost cost prohibitive in those cases. Cummins Crosspoint was faced with the task of STP – segmentation, targeting, and positioning for this product. To accomplish this task Cummins Crosspoint had to account for four major factors: establish the proper balance between the hybrid technology and the ‘green’ value, implement a driver education system and provide feedback to the driver, combine natural gas engines with hybrid technology, and improve the perceptions of the engine in the marketplace.

Learning Outcomes: 
  1. To expose the students to the key considerations in the segmentation, targeting, and positioning of a product for which (a) there is little overt demand; (b) has a negative reputation in the marketplace; and (c) at first glance does not appear to be financially viable for private fleets and vehicle retrofits.
  2. To understand the challenges a firm has in bringing a ‘green’ product into the marketplace. 
  3. To understand the factors that need to be considered when a product has a relatively high price point and a relatively low economic viability.
  4. To explore the necessary points of consideration in introducing such a product into the marketplace.
  5. To give the students an opportunity to explore various additional marketing activities a company might undertake to enhance this type of product’s chances for success.