The New Beetle Case Study Casey Fei Isaac Derek. Programme 3Cs Issues Recommendations.
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Transcript of The New Beetle Case Study Casey Fei Isaac Derek. Programme 3Cs Issues Recommendations.
3Cs - Company
• A German car company in a little turmoil• The situation is:
Sales have been decliningJapanese competition, appreciation of
Deutschemark, etc.
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Total VW
3Cs - Competition
Mapping out everyone’s position:
American Cars (Ford, Chevrolet, Dodge)
Japanese Cars(Honda, Toyota, Nissan)
New Beetle
Uniqueness
Reliability
3Cs - Consumers
• There are:– The old fogies– The new generation
The general opinion: “the people’s car”
- VW offers a unique, individualistic experience
- affordable German engineering
3Cs - Consumers
Percentage of Small Cars Sold in 1997
Chevrolet Cavalier
Dodge Neon
For Escort
Geo Prizm
Honda Civic
Hyundai Elantra
Isuzu Stylus
Mazda Protégé
Mercury Tracer
Nissan Sentra
Plymouth Neon
Pontiac Sunfire
Saturn
Suburu Impreza 4wd
Suzuki Esteem
Toyota Corolla
Toyota Tercel
VW Golf
VW Jetta
VW Golf 0.9 % VW Jetta 4.1%
The Present Situation
• “Drivers Wanted” campaign boost• Now the New Beetle…
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Issues (1 of 3)
• How much of the car’s heritage should the new positioning use to leverage?– Play on the nostalgia– Appeal to the new generation
Designing a marketing scheme that would appeal to a majority of consumers in both target groups.
Issues (2 of 3)
• How to rebuild VW’s image through the New Beetle?– Belief that VW product line is tired and old
compared to Japanese carsOverall Opinion VW and Key Competitor- U.S.
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Nissan
Saturn
Toyota
Issues (2 of 3 cont’d)
• How to rebuild VW’s image through the New Beetle?– Improve the reliability– Make regular innovations– Strengthen its brand equity
Issues (3 of 3)
• How to price the New Beetle?
This is in contrast with VW’s heritage of affordability.
Price of Small Cars 1998 - U.S.
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Issues (3 of 3 cont’d)
• How to price the New Beetle?– If the price is set too high, consumers might
trade up into a higher-priced segment– If the price is set too low the car might not be
attractive enough to dealers due to low margins and thus fall short of VW’s profitability goals
Recommendations (1 of 3)
• Approaching the Consumer– Two generations in target audience: Baby
Boomers and Young Generation– More effort should be focused on campaign to
attract Young Generation consumers and appeal to their mentality, behaviour and attitude.
– A campaign for Baby Boomers would be straightforward by using nostalgic images to bring back good memories from the past and rekindle their interest in the Beetle.
Recommendations (2 of 3)
• Pricing Options– Two versions of New Beetle for two different
generations of consumers.– Basic and cheap model will appeal to younger
generation of consumers who will be more budget conscious.
– Enhanced model with popular options will be catered to Baby Boomers who can afford to spend more on a new car (or any other wealthy person).
Recommendations (3 of 3)
• Media Channels– There’s an opportunity to use the positive
media coverage to Volkswagen’s advantage. Get the media involved to spread the word about the Beetle!
– Other suggested options to increase Beetle’s exposure: Print Advertising in magazines and showcasing car at big events.