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Product-Driven Market Poses Challenges to Pesticide Suppliers Seeking Customer Loyalty

LITTLE FALLS, NJ, November 15, 2006 –

It is universally recognized that, in the professional pest management business, products rule. And that can be a challenge for suppliers vying for the loyalty of pest management professionals. Even when customer satisfaction is high, companies that haven’t established strong patterns of loyalty among their customers often see them gravitate to a competing product if its performance proves to be as good or better than their current product choice. A newly updated study from Kline & Company examines the factors that affect loyalty and product switching, ranking factors that are most important to pest management professionals (PMPs).

The study, CUSTOMER SATISFACTION AND LOYALTY AMONG U.S. PEST MANAGEMENT PROFESSIONALS 2006, rates the importance of purchase factors and then ranks the leading pesticide suppliers against this list. Its results show that the highest overall satisfaction levels are attributed to those companies like Bayer Environmental Science and BASF that are successfully marketing to the PMP population as a whole. Companies like Dow AgroSciences that follow a more selective customer strategy earned lower ratings from the survey population as a whole but usually see compensating higher ratings from their specific customer base.

“A selective customer strategy appears to drive a short-term gain but may limit long long-term growth. Without stable levels of customer loyalty in a product-dependent market, every time a good new product is introduced, a percentage of customers automatically migrate to it,” says Mancer Cyr, senior associate for Kline’s Specialty Pesticides practice.

Based on interviews with PMPs and distributors, the Kline study focuses on 25 purchase decision factors, their importance, and the competitive ratings given to the four leading manufacturers against these factors. This is the first look manufacturers will have at customer perceptions for the 2006 market year.

Another key element of the Kline report is an emphasis on factor importance that compares what PMPs say about their buying decision with actual purchase data. By combining the two sets of data, manufacturers are able to see which elements are the most critical in the decision-making process and which ones do not have a significant impact on the buying decision.

A new component added to the 2006 edition of the study is a measurement of customer loyalty. Because satisfied customers sometimes switch products and less satisfied customers sometimes elect to stand pat, loyalty becomes the true barometer of customer continuity, while satisfaction data provides some direction on where to focus new initiatives.

“Support- and marketing-related factors still play an important role in PMPs’ purchase decisions, and there has been remarkable consistency in the ranking of these factors, which have remained relatively unchanged since the first edition of the study,” says Cyr.

As generic products infiltrate this market, manufacturers should expect these factors to play a role, along with price, in establishing a loyal customer base, Cyr adds.

For more information on this study, go to www.klinegroup.com/reports/Y567B.asp or contact Dennis Fugate at +1-410-418-8934. In Europe, contact Erin Durham at +39-0331-976969.

For information on the customized consulting capabilities of Kline’s Specialty Pesticides Practice contact Mancer Cyr at +1-856-764-3536.

Established in 1959, Kline & Company (www.klinegroup.com) is a management consulting and market research firm serving clients worldwide in the life sciences, chemicals and materials, consumer products, and energy sectors.

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