New Bettle Case Study

8/3/2019 New Bettle Case Study

1/19

The New Beetle

Case Study

Casey Fei Isaac Derek


2/19

Programme

3Cs

Issues

Recommendations


3/19

3Cs - Company


4/19

3Cs - Company

A German car company in a little turmoil

The situation is:

Sales have been declining

Japanese competition, appreciation ofDeutschemark, etc.

100000

200000

300000

400000

500000

600000

Year

Total VW


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3Cs - Competition

Mapping out everyones position:

American

Cars (Ford,

Chevrolet,

Dodge)

Japanese Cars

(Honda,

Toyota,

Nissan)

New

Beetl

e

Uniqueness

Reliability


6/19

3Cs - Consumers

There are:

The old fogies

The new generation

The general opinion: the peoples car

- VW offers a unique, individualisticexperience

- affordable German engineering


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3Cs - Consumers

Percentage of Small Cars Sold in 1997

Chevrolet Cavalier

Dodge Neon

For Escort

Geo Prizm

Honda Civic

Hyundai Elantra

Isuzu Stylus

Mazda Protg

Mercury Tracer

Nissan Sentra

Plymouth Neon

Pontiac Sunfire

SaturnSuburu Impreza 4

Suzuki Esteem

Toyota Corolla

Toyota Tercel

VW Golf

VW Jetta

VW Golf 0.9 % VW Jetta 4.1%


8/19

The Present Situation

Drivers Wanted campaign boost

Now the New Beetle

0

100000

200000

300000

400000

500000

600000

1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49

Year

Total VW


9/19

Next up: ISSUES


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Issues (1 of 3)

How much of the cars 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.


11/19

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 carsOverall Opinion VW and Key Competitor- U.S.

0

10

20

30

40

50

6070

80

90

100

Dec-95 Mar-96 Jun-96 Sep-96 Dec-96 Mar-97 Jun-97 Sep-97 Dec-97

Time

%E

xcellent/GoodOpinion

VW

Nissan

Saturn

Toyota


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Issues (2 of 3 contd)

How to rebuild VWs image through the

New Beetle?

Improve the reliability

Make regular innovations

Strengthen its brand equity


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Issues (3 of 3)

How to price the New Beetle?

This is in contrast with VWs heritage of

affordability.

Price of Small Cars 1998 - U.S.

0

5000

10000

15000

20000

25000

CavalierZ24

VWNewBeetle

Nissan

Sentra

SE

SaturnSC2

Toyota

CorollaLE

DodgeNeonRT

CheroletC

avalierLS

FordEscortSE

Toyota

CorollaVE

CheroletCavalier

Niss

anSentra

FordEscortLX

DodgeNeonC

ompetiton

SaturnSL

Brand

Price


14/19

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 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 VWs profitability

goals


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Finally: the RECOMMENDATIONS


16/19

Recommendations (1 of 3)

Approaching the Consumer

Two generations in target audience: Baby

Boomers and Young Generation

More effort should be focused on campaign toattract Young Generation consumers and appeal

to their mentality, behaviour and attitude.

A campaign for Baby Boomers would be

straightforward by using nostalgic images tobring back good memories from the past and

rekindle their interest in the Beetle.


17/19


Pricing Options Two versions of New Beetle for two different

generations of consumers.

Basic and cheap model will appeal to youngergeneration of consumers who will be morebudget conscious.

Enhanced model with popular options will be

catered to Baby Boomers who can afford tospend more on a new car (or any other wealthyperson).


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Media Channels

Theres an opportunity to use the positive

media coverage to Volkswagens advantage.

Get the media involved to spread the wordabout the Beetle!

Other suggested options to increase Beetles

exposure: Print Advertising in magazines andshowcasing car at big events.


19/19

END

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