ld water washing and to promote Arctic Powers position as the leading cold water washing detergent. We would immediately implement our cost reduction strategy while phasing in our price reductions through the use of discount coupons. This would allow Arctic Power to increase its margins while the brand is being repositioned. Once our price reduction strategy is complete, there will be less need for consumer discount coupons as our prices will already be lower. Arctic Powers lower cost/price structure would allow it greater flexibility to respond to competitors promotion strategies.BudgetDespite facing cutthroat competition that has seen the cost of goods sold rise 15% during the past three years and prices rise only 5%, Arctic Power should be able to continue to have an 18% contribution margin for its sales dollars. Our primary budget strategy would be to reduce costs and promotion expenses, while increasing the use of cheaper television and radio advertising. This would allow Arctic Power to increase brand awareness as well as promote the benefits of cold water washing. Arctic Power will also look to new cost saving technologies and other measures to assure profitability over the long run. 14 YEARS LATER: THE CONCLUSIONThe year is 2001. Through the efforts of Smith and Jones, LTDs marketing strategy, Arctic Power is the leading cold water laundry detergent in Canada and has expanded internationally. The 1987 Arctic Power campaign will be widely studied by MBA students from Palm Desert, California to Palm Beach, Florida as one of the great marketing success stories. Spiel and Dimick, LTD, will later go on to help some nerdy Bill Gates kid market this unique idea of his called Windows while assisting Al Gore in his new invention, the Internet....
