Car Manufactury - Marketing Strategies Meeting Customer Needs - Coursework Example

Critical Marketing Issues Introduction Like all other industries, the car manufacturing industry has also seen tremendous changes and automation since the last five years. Everything has evolved to be automated thereby making car manufacturing a much simpler and quicker task than before. However, anything that glitters is not gold; this technique however efficient and fast, has led to increased prices of the cars. Today we see that the car markets are surging with sky rising prices. This is the result of expensive machinery and tools that are used to manufacture the car. The customers today, do not compromise on quality (Halligan, 2009). Therefore, the car manufacturers need to make sure that they specialize in whatever they make so that their goods can be sold at high prices in the market. Since the world has grown to be a global village, cars are one of the most frequently and expensively imported and exported commodities. In order to attract customers to a particular brand of cars, the car manufacturers employ certain marketing strategies. The manufacturers may exploit their brand loyalties or they might advertise aggressively to attract new customers. In some cases, the manufacturers may affiliate celebrities and other well known people to their brand of cars to attract customers. In the worst case scenario, the manufacturers even speak badly of their own former products so as to promote the latter ones (Ferrell, 2010). All these techniques have been used by the car manufacturers to market their cars in the huge market of cars that exists today. There is a lot of competition from hoards of manufacturers and so it is eventually the best quality manufacturer that wins the race. These marketing strategies have evolved over time to meet customer needs. However, there have been various factors contributing to the changes in marketing strategies by car manufacturers. Whatever strategies the manufacturers may employ, their goal is to make the largest profits out of their most recent ventures (Levinson, 2007). Factors contributing to changes in marketing strategies by car manufacturers 1. Changes in the environment One of the most crucial factors that have changed the marketing strategies of nearly all car manufacturers is the recent increase in awareness of the local population. Today, everyone is so much more aware of issues related to the environment that around three years back the car manufacturers globally saw a huge dip in the demand for cars (Bayan, 2006). Issues like global warming and pollution have been so extensively studied that now the consumers know what hazards are they welcoming when they buy a new car (Trott, 2008). Therefore, a lot of car users now prefer using public transport, cycles or even walking by foot. In order to cater to a more informed audience, the car manufacturers employ marketing strategies that are more cleverly structured. Recently, most car manufacturers claim to have gone green. Car manufacturers claim that the new cars that are being made are designed keeping in mind all environmental concerns and so these will not prove hazardous to the environment. Recently Honda, Toyota, General Motors and Tesla Motors have declared to have gone environmental friendly. These manufacturers now market their new cars with the tag of being good to the environment. They say that their cars are designed with the latest filters that would not harm the environment (Rother, 2009). Car manufacturers have now become clever, most disguise even ordinary cars to have been made with extra caution to cater for prevention of global warming. Some however, have done the effort to satisfy the upsurge in consumer demand for environment friendly locomotives by design cars that are actually harmless to the environment. The most notable of these manufacturers is Tesla Motors which was founded in 2003 by ex-Google and PayPal executives. The manufacturers at Tesla Motors believe that cars can be environment friendly and speedy at the same time. They believe that power needs not be compromised for a pollution free environment. So their solution to global warming is the making of hundred percent electrically powered cars. This way the cars do not give off hazardous sulfur fumes. At the same time, cars by Tesla motors are extremely speedy. They can reach a speed of 60 mph in barely 3.9 seconds. This is equivalent to a grand 256MPG from its electric charge (Boxwell, 2010). Therefore cars by Tesla motors have been quite successful in marketing for the green environment. Manufacturers quote that at Tesla Motors the cost of running a sleek, green car is merely 2 cents per mile (Cefo, 2009). It is thus very affordable to maintain and at the same time it is good for the environment. 2. Increased exposure to media In the recent years, media has become a vital part of nearly everybody’s lifestyle. People of all age groups enjoy media of one kind or another. Some are influenced by magazines and newspapers while some watch television too much. Whatever the source maybe, media has grown to be a large part of who we are today. Lots of people look forward to media to guide them through their problems and help them make wise decisions. This is why car manufacturers have recently begun to affiliate themselves with media related activities (Ries, 1994). For example, the movie Transformers which was released in 2007 had a Chevrolet as its main robotic character. It was because the manufacturers realize that customers today are heavily influenced by the media and any promotions that they would do through the media, would have a strong and lasting effect on their sales. Similarly in 2008, Gran Torino was released which was actually named after Gran Torino by Ford. This attracted lots of youngsters to both, the movie and the car. Similarly, Fast and Furious was a movie series comprising of four movies to date. These series added significant value to Toyota, Nissan, Volkswagen, Mazda and Mitsubishi (Scott, 2010). It is believed by the car manufacturers today, that people tend to buy those goods that they see in movies or songs since the media has a very strong influence on the local population. In addition, different well known celebrities have also been hired by car manufacturers to promote their brands. It is believed that celebrities that are known around the world add significantly to the value of the cars that they advertise for. In 2009, for example, Tesla Motors were a big part of the Oscar festivities. Hollywood megastars such as Leonardo DiCaprio, Brad Pitt, George Clooney and Matt Demon drove their Teslas to the Oscar ceremony. This gave Tesla Motors a huge platform since it gave the manufacturers an opportunity to have their car in front of thousands of people live and millions of audience on television (Kadirov, 2010). This increased the hype for the car by many folds since these actors are some of the most sought for personalities in the media world today. Whatever these celebrities own, most people aspire to have it too and so Tesla manufacturers used this opportunity to promote their relatively new but a very promising brand of cars. 3. Global Financial Crisis and Income Inequity The recession that the world has been facing since the last five years has contributed immensely to the changes in the marketing strategies of car manufacturers today. Since a lot of people have become jobless because of the global recession, the world faces a huge financial crisis today. There are a lot of financial concerns that have sprung up because of this recession. People do not have too much money to waste on lucrative, luxurious cars and so they tend to go more for better priced alternatives than expensive and rare vehicles (Rubenstein, 2008). Therefore car manufacturers have begun to market their products in a way to attract the masses. The new cars have been manufactured keeping in mind comfort, design and affordability. The marketing strategy used by car manufacturers to allure the masses is to have advertised their cars in a way so that the prospective customers believe that the manufacturers are much concerned about the financial well being of their customers (Church, 2003). Some companies have claimed that they would take in old cars and parts in exchange for new cars. This is a very clever marketing strategy for firms to attract customers. Alongside, it is beneficial for the customers too since they get new cars in exchange of what is garbage for them. Honda and Toyota are the two car manufacturers that have given the world the most affordable cars with the most reliable features. Besides the problem of a huge financial depression that the world faces today, there has been a large income inequality created amongst the different members of the society locally. On a global scale, the income inequity is a much more serious threat. While some companies strive to work for the less privileged and the more middle class society which struggles to get a car that would serve the family while being affordable at the same time, there are car manufacturers that focus particularly on the affluent members of the society. As the poor gets poorer, and the rich gets richer, the rich members of the society want cars that would pacify their social standing and so Mercedes introduced a diamond studded model. The car is full of diamonds and priced at 4.8 million dollars. This diamond studded is the Saudi Prince Waleed’s 38th car. Of course, not everyone can afford such a luxurious, jeweled ride but for those who can, this is surely a great treat. Besides that, Rolls Royce is also amongst the most expensive car manufacturers. This is because these cars have a handmade interior. In the world of automation, a handmade interior is one of the most sought after features by the royal families. Enzo by Ferrari is also a very highly priced car since it is extremely advanced. It has a V12 engine which is the first of a new generation for Ferrari. Ferrari manufacturers have always looked for advancement and tech savvy features to serve the elite. Enzo is ranked fourth on the list of ten greatest Ferraris of all times by the magazine Motor Trend Classic (Acerbi, 2006). With the rising income inequality, the rich members want the most luxurious cars to show off their wealth and material prestige to the world and some car manufacturers market their products targeting at such audiences specifically. To market for the most expensive cars, usually jewel owners, leather firm owners or steel mill owners stand up to verify how genuine the car components are and the more rare it is, the more highly priced it becomes. Car manufacturers that produce such rare cars market them by giving the first genuine models to the royal families. When royalties approve of them and use them, other elites are inclined to go for them because of the materialistic race the whole world is a part of. Everybody strives to show themselves as being better off and cars have come across as the most luxurious commodities someone can own. Tesla manufactures have been striving to provide a balance between luxury and cost. Their marketing strategy involves targeting the masses and producing for them. Therefore, the second all electric car by Tesla Motors is the Model S sedan. It is a very sleek looking sports car which is all electric but very powerful. Also, it has been made relatively affordable since it costs 57400 dollars which is nearly half the price of Tesla’s Roadster which was the first all electric cars by the manufacturers. Roadster is priced at a great 109000 dollars but soon Tesla Manufacturers realized that it is better and more profitable to cater for the masses thereby they produced their version of sedan (Maurer, 2007). Though, this is also more highly priced than an ordinary sedan but the brand is worth the price. Whatever marketing strategies the car manufacturers may employ, whatever sector of audiences may they promise to cater to, in the end it is more important to know how successful did their venture turn out to be and not who they benefitted. Therefore, most car manufacturers try their luck from one sector of the population to another in order to find out where their gains lie. Sometimes, like for Lamborghini and Bugatti , the car manufactures benefit more by being luxurious brands for the elite; while otherwise, like for Toyota and Honda, the manufacturers benefit more by catering to the masses which suffer from financial setbacks from time to time (Sato, 2006). 4. Changes in interests and demands No matter how creative and farfetched the car manufacturers may be, they would not be able to make their mark in the global market if their cars are not sold and valued by the customers. Therefore, car manufactures need to employ marketing strategies that would allure customers that they produce the cars for. The last five years have seen a tremendous increase in the interest of car racing for youngsters. Most young people aged between 18 and 25 spend huge sums of money to watch car racing. The audiences that watch these car races on television are just as eager to spend hours on end over them. Therefore, some car manufacturers have exploited this recent trend to promote their cars (Owen, 2009). For example, Ferrari is the most famous car manufacturer that indulges gravely in such endeavors. Ferrari arranges for international car racing competitions and gives the world some of the most breathtaking races. Since all cars used by Ferrari sponsored car races are Ferraris, this is Ferrari’s way of promoting the brand. When people watch these cars running so aggressively on the race pathways, many are tempted to buy them too. Therefore, this marketing strategy allures all those who watch car races or participate in them (Stone, 2010). Also, other commodities have proven to be marketing for car manufacturers indirectly. For example, the last five years have seen a tremendous increase in the demand for energy drinks. Previously, very few would know what an energy drink could do and an extremely slim portion of the population used these energy drinks for work. However, it has now become a part of everyday consumption for most teenagers today. Some have these energy drinks for fun while some use them to increase their concentration span. Whatever the reason may be, the demand for the energy drinks has increased dramatically. Car manufacturers have used this increase in demand in their favor by affiliating themselves with brands of energy drinks (Zeigler, 2009). This has increased the market for both the cars and the energy drinks simultaneously. For example, Cooper by Mini is used extensively for the promotion of Red Bull energy drinks. The Mini manufacturers have given their cars for the promotion because they believe that this would increase their clientele too. This is one of the most intelligent strategies used by car manufacturers to promote their cars with another complementary good side by side. This induces a parallel clientele for both goods thus benefitting two parties at the same time. Car manufacturers can, in this way, market their cars in a subtle way (Borges, 2009). Everybody gets to know of the new cars in the market without it being strikingly obvious and it is often this subtle promotion that reaps the greatest benefits for the manufacturers. Many people do not realize that in such campaigns the car models are being promoted since it is basically for the promotion of the other complementary good. Therefore, the car manufacturers gain without having to do much for the promotion. This is indeed a recent way of promoting cars by the manufacturers and nobody used these methods five years ago. It is because of changing trends, interests and demands that such clever marketing strategies have been developed by the car manufacturers to promote their car models. 5. Inflation and other economic factors Besides the factors mentioned above, there are a lot of other factors that have contributed to the recent change in marketing strategies employed by car manufacturers. Most car manufacturers today are striving to make the most revenue with the least cost. The cost minimizing strategy is used in marketing so as to increase profits (Pollak, 2008). There is a lot of inflation globally and so to cater to the growing need for money the car manufacturers have begun to adopt a scheme that minimizes costs for them. Instead of using banners and pamphlets for marketing the most recent models, car manufacturers now use their official websites to promote the new models (Hazlitt, 1988). This saves costs and reaches a much larger audience both of which are in the favor of the car manufacturers. Another important factor contributing to changing marketing strategies is the increased competition. There are so many car manufacturers in the world today that in order to create their mark in the current world, each of the manufacturers needs to be distinguished and better than the rest. Therefore, some car manufactures have resorted to aggressive marketing strategies to come to the top (Porter, 1999). They adopt aggressive marketing strategies just because there is too much competition and so some car manufacturers believe that if they can’t rise in the crowd, they would have to drive back others. This strategy has been used by manufactures like Toyota, Honda and Mitsubishi. Conclusion The world has seen some of the best cars in the recent years. Many new and promising car manufacturers have come to the forefront. These car manufacturers have employed many different marketing strategies to attract the customers. Some manufacturers have targeted at the elite audience while other have been working for the masses. Whatever the set of audiences the car manufacturers agree on targeting at, they need to make sure that their marketing strategies allure the customers and they build customer loyalty over time (Sollis, 2010). For this, the car manufacturers need to focus on all the different changes that are occurring in the world and be aware of all social, economic and political problems since their marketing strategies need to be cleverly planned and in harmony with solving all global issues and problems. References Rubenstein, J. (2008). Making and Selling Cars: Innovation and Change in the US Automotive Industry. The John Hopkins University Press. Zeigler, S. 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