The New BeetleCase StudyCasey Fei Isaac Derek

Programme3CsIssuesRecommendations

3Cs - Company

3Cs - CompanyA German car company in a little turmoilThe situation is:Sales have been decliningJapanese competition, appreciation of Deutschemark, etc.

Chart1

19492

1950330

1951417

1952980

19531214

19548913

195535851

195649550

195772555

195885985

1959129315

1960162037

1961186260

1962226649

1963270788

1964313426

1965357144

1966411956

1967443510

1968569262

1969551366

1970569696

1971522655

1972485645

1973476295

1974334515

1975267730

1976201670

1977260702

1978239300

1979292019

1980293595

1981278513

1982171281

1983166915

1984177709

1985218042

1986217231

1987191705

1988168800

1989133650

1990136357

199196736

199275873

199349533

199497043

1995115114

1996135907

1997137885

Year

Total VW

Sheet1

YearTotal VW

19492

1950330

1951417

1952980

19531214

19548913

195535851

195649550

195772555

195885985

1959129315

1960162037

1961186260

1962226649

1963270788

1964313426

1965357144

1966411956

1967443510

1968569262

1969551366

1970569696

1971522655

1972485645

1973476295

1974334515

1975267730

1976201670

1977260702

1978239300

1979292019

1980293595

1981278513

1982171281

1983166915

1984177709

1985218042

1986217231

1987191705

1988168800

1989133650

1990136357

199196736

199275873

199349533

199497043

1995115114

1996135907

1997137885

Sheet1

Year

Total VW

Sheet2

Sheet3

3Cs - CompetitionMapping out everyones position: Uniqueness Reliability

3Cs - ConsumersThere are:The old fogiesThe new generation

The general opinion: the peoples car- VW offers a unique, individualistic experience- affordable German engineering

3Cs - Consumers

Chart1

0.136

0.55

0.128

0.028

0.019

0.019

0

0.024

0.02

0.055

0.039

0.046

0.113

0.011

0.03

0.098

0.014

0.009

0.041

VW Golf 0.9 %

VW Jetta 4.1%

% of Small Cars Sold in 1997

Percentage of Small Cars Sold in 1997

Sheet1

Upper Small Cars% of Small Cars Sold in 1997

Chevrolet Cavalier0.136

Dodge Neon0.55

For Escort0.128

Geo Prizm0.028

Honda Civic0.019

Hyundai Elantra0.019

Isuzu Stylus0

Mazda Protg0.024

Mercury Tracer0.02

Nissan Sentra0.055

Plymouth Neon0.039

Pontiac Sunfire0.046

Saturn0.113

Suburu Impreza 4wd0.011

Suzuki Esteem0.03

Toyota Corolla0.098

Toyota Tercel0.014

VW Golf0.009

VW Jetta0.041

Sheet1

VW Golf 0.9 %

VW Jetta 4.1%

% of Small Cars Sold in 1997

Percentage of Small Cars Sold in 1997

Sheet2

Sheet3

The Present SituationDrivers Wanted campaign boostNow the New Beetle

Chart3

19492

1950330

1951417

1952980

19531214

19548913

195535851

195649550

195772555

195885985

1959129315

1960162037

1961186260

1962226649

1963270788

1964313426

1965357144

1966411956

1967443510

1968569262

1969551366

1970569696

1971522655

1972485645

1973476295

1974334515

1975267730

1976201670

1977260702

1978239300

1979292019

1980293595

1981278513

1982171281

1983166915

1984177709

1985218042

1986217231

1987191705

1988168800

1989133650

1990136357

199196736

199275873

199349533

199497043

1995115114

1996135907

1997137885

Year

Total VW

Sheet1

YearTotal VW

19492

1950330

1951417

1952980

19531214

19548913

195535851

195649550

195772555

195885985

1959129315

1960162037

1961186260

1962226649

1963270788

1964313426

1965357144

1966411956

1967443510

1968569262

1969551366

1970569696

1971522655

1972485645

1973476295

1974334515

1975267730

1976201670

1977260702

1978239300

1979292019

1980293595

1981278513

1982171281

1983166915

1984177709

1985218042

1986217231

1987191705

1988168800

1989133650

1990136357

199196736

199275873

199349533

199497043

1995115114

1996135907

1997137885

Sheet1

Year

Total VW

Sheet2

Sheet3

Next up: ISSUES

Issues (1 of 3)How much of the cars heritage should the new positioning use to leverage?Play on the nostalgiaAppeal 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 VWs image through the New Beetle?Belief that VW product line is tired and old compared to Japanese cars

Issues (2 of 3 contd)How to rebuild VWs image through the New Beetle?Improve the reliabilityMake regular innovationsStrengthen its brand equity

Issues (3 of 3)How to price the New Beetle?

This is in contrast with VWs heritage of affordability.

Issues (3 of 3 contd)How to price the New Beetle?If the price is set too high, consumers might trade up into a higher-priced segmentIf the price is set too low the car might not be attractive enough to dealers due to low margins and thus fall short of VWs profitability goals

Finally: the RECOMMENDATIONS

Recommendations (1 of 3)Approaching the ConsumerTwo generations in target audience: Baby Boomers and Young GenerationMore 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 OptionsTwo 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 ChannelsTheres an opportunity to use the positive media coverage to Volkswagens advantage. Get the media involved to spread the word about the Beetle!Other suggested options to increase Beetles exposure: Print Advertising in magazines and showcasing car at big events.

END.