Different Brands of Luxurious Vehicles - Research Paper Example

18th March Industry Report: Luxury Cars With the involvement of many competing entries in the locomotive environment, the output has been very appealing with different brands of luxurious vehicles being launched in the market. This challenges the decision-making process of any interested car buyers as they have a myriad of alternatives to level on. The competition is real as each vehicle brand tries to outshine and edge its opponents out of the market (Hoffmann and Ivan 56). In this paper, the researcher seeks to evaluate luxury car industry, the performance of the top five brands, namely Audi, BMW, Cadillac, Lexus and Mercedes-Benz. The researcher will focus on individual performance for each of the brands, seek to evaluate the best performing, understand their market segmentation, and marketing mix. Product Identification In this section, the researcher is going to argue out each and every vehicle brand depending on the consumer appreciation feedback and statistics about their luxurious products. Following the results released by Forbes Insights, data collected from BIGinsight.com have guided the multibillion dollar firm to come up with a comprehensive listing of the leading luxury automotive brands graded using a composite score that gives ranking according to customer satisfaction and loyalty of the customers to the vehicle brand (Maynard 32). 1. Audi Audi, an up-and-coming alternative luxury brand, has attracted a myriad of consumers over the past few years and this explains why the average price for one of its vehicles is now at $5, 000. This has been viewed as the greatest of all times improvement after the economy went on crisis and experienced a slow recovery due to external factors such as inflation; the auto industry has been bouncing back from the depths of 2009 where its sales hit the sea floor, but the thirst for luxury remains powerful. In 2011, Audi posted their highest sales ever in a market flooded by a myriad of locomotive manufacturers (Hoffmann and Ivan 66). The German automobile manufacturer is a member of the German Big 3 luxury automakers, which are BMW and Mercedes-Benz and are the three best-selling luxury automakers in the world. Audi produces fully guaranteed galvanized cars to prevent corrosion and is recognized as the first auto-maker to introduce this module in its body shell after which Porsche followed. 2. BMW Bayerische Motoren Werke AG (Bavarian Motor Works) is a German automobile that was founded in 1916 and has never disappointed since then. It is the parent company of Rolls Royce Motor Cars, has a new class model which was a line of compact sedans and is manufactured in more than five countries. The 1 series was originally launched in 2004 and is the BMWs smallest car. Available in all BMW outlets are the second generation hatchback (F20) and first generation coupe/convertible (E82/E88). The 3 Series is a compact executive car manufactured since model year 1975 and is currently in its sixth generation (F30). Models include the sport sedan (F30), fourth generation station wagon (F30), convertible (E93) and the Gran Turismo which is the most sought after in the BMW series. In 2014, the 4 Series was released and as a result, it replaced the 3 Series Coupe and Convertible. Interestingly, BMWs full-size flagship executive sedan is the 7 Series and this has spurred mixed reactions from the public sphere. Bavarian Motor Works (BMW) introduces many of their innovations first in the 7 Series, such as the iDrive system among others. The 7 Series Hydrogen, has one of the worlds first hydrogen fueled internal combustion engines and is propelled by liquid hydrogen and emits only clean water vapor unlike smoke in the rest of the vehicle. According to the BMW’s production report, the 6-Series is the automobile’s best luxury sport coupe/convertible (F12/F13) (Hoffmann and Ivan 68). Then there is an all-wheel model branded as drive-X5 which was BMW’s first SUV model and was based on the 5 Series. It’s a mid-size luxury SUV (SAV) that has been in the market since 2000 and has attracted quite a following. 3. Cadillac It’s a division of General Motors based in the US that promotes luxury vehicles in the US and the whole world at large. Cadillac started flooding the market in 2002 and since then, it has always held a place at the top of the luxury automobiles within the States. Cadillac introduced a new design modular for the new generation called “Art and Science” an automobile vocabulary that expresses bold, high-end technology design and invokes the technology used to design it." This new automated design language has spread from the original CTS to the Cadillac XLR roadster causing furore from the public sphere over the mark quality (Hoffmann and Ivan 68). Cadillacs model lineup includes rear- and all-wheel-drive sedans, roadsters, crossovers and SUVs. The only exceptions are the front-wheel drive Cadillac BLS and the Cadillac DTS, neither of which are still in the markets. The second-generation CTS-V is a proximal rival to the BMW M5 and statistics reveal that soon the latter is going to be edged out of production lines. 4. Lexus Unlike the other luxury vehicles, Lexus is the luxury division of the Japanese Toyota Motor Corporation. Since the 2000s, Lexus has improved its sales outside its largest market which is the USA, through an ongoing global expansion. Lexus identified dealerships in Japans domestic market in 2005, becoming the first Japanese premium car marquee to launch such a program in its country of origin. Further debuts in Southeast Asia, Latin America, Europe, and other export regions have since followed and the response has all been positive. The divisions lineup has been expanded to reflect and accommodate certain regional specifications in model and power train configurations. In 2010, Lexus went through a gradual sales recovery in North America and Asia as it narrowed down to the addition of a few high-end vehicles and providing their consumers with a number of options (Hoffmann and Ivan 69). At this point, Lexus reported a sales increase in the whole of the US which were attributed to the change of plans initiated by the Toyota vehicle. There are two models, ES 350 and several IS models that were affected by an order questioning their floor mats, a move which paralyzed the sales of this model while parent company Toyota bore the brunt of negative publicity amid a product recall due to a below-average quality production of their vehicles. 5. Mercedes-Benz Mercedes is a German automobile manufacturer in bulk, luxury buses, coaches and trucks. Since its inception, Mercedes-Benz has established and maintained a reputation for its quality and durability. In June, Mercedes-Benz made a dramatic come back to the industry after being on the criticism page for quality and their sales improved almost by 50%. This was encompassed in their annual report where Mercedes demonstrated a dramatic improvement by rising from 25th to 5th place and claiming several awards for its models (Hoffmann and Ivan 70). In 2008, Mercedes-Benzs initial quality rating improved by one position, though expected, to the fourth place. Source: http://www.statista.com/statistics/287620/luxury-vehicles-united-states-premium-vehicle-market-share/ Target Market Trends in the environment In order to face off competition from other car companies, the best five has rolled out a list of their very luxurious machines with an intent of increasing its following globally. However, talking from the cultural point of view, the ruling has a class of distinguishing itself from the hoi polloi. This aspect of the elite has put this car in a successful position where it will be controlling most of the public needs and demands (Maynard 34). One would dispute this statement because in mind, he has models from either BMW or Audi but after reading about the Mercedes-Benz, one would be tempted to change his or her earlier perception about this vehicle (Hoffmann and Ivan 56). This trend from the ruling class represents continuing growth of opportunities which the car giant is likely to tap into. Again, with the improved technology in place, each automobile company is trying to outshine the other market contributors by the improvement of their specifications. In general, the BMW, Audi, Mercedes-Benz, Lexus and the Cadillac target young drivers in ambitious growth plans and for instance, in a recent release from the car giant, the group hinted that the wealthiest group in Hong Kong for instance, has become younger, a fact which has broadened their product range to reach out to the younger market segments. This as a result has become their new tactic was quoted in the release. The group then identifies and grouped a number of demands all drawn from their consumers (Hoffmann and Ivan 56). There are some consumers that don’t follow trends. This might sound like a conspiracy theory, but it’s the plain truth according to the car giant. The car company reports that their consumers look for both practical and high performance vehicles. Market Segmentation When it comes to market segmentation, the five brands have done their assignments to perfection. They have narrowed down to a selected group of people which they have served with zeal and a lot of zest. This group of people is the elite or ruling class whose love for luxurious assets is overwhelming (Hoffmann and Ivan 56). They must have a specific target group and this group of people as indicated earlier is the ruling class or rather the political class, so to speak which exercises control over the rest. Their willingness to spend money on luxury products is not a question, but a confirmed fact. These people have money and to them, money should be spent. The five brands have observed the car industry and only chose to produce these products for the ruling class who are very good spenders. This group of people also demands for quality and have a taste of their own. They are go-getters and always go for what they want (Maynard 34). They want quality and it’s a good thing that Mercedes-Benz for example, is attending to their needs, customized needs for this matter. Buyer Behavior Cadillac commands a lot of respect among its competitors due to the uniqueness of its automobiles, but for a lot of people, that respect is analogous to. So the challenge that people have is, how do they take that residual positive sentiment and make it relevant for today’s buyer? Overall sales of the Cadillac were up by 3.7% in 2011. This class of people has been known over the years to be supportive when quality comes into discussion. The fact that they are good spenders makes them a good target group when bombarded with quality (Hoffmann and Ivan 56). The consumer market is represented by the elite group while the industrial market is represented by the sporting firms. Several factors influence these people’s buying behaviors, but among these factors is, desire for the best product which can successfully attend to their needs with ease. Where and when these products are bought is a subject for discussion. However, the why question should be used to answer the above when and where questions. Market Mix This section seeks to bring to the limelight the products in discussion and highlight the convincing specifications that propel the car brands to greater heights of success. Product The five brands have each identified a niche where they are best at and are reaping profits from this establishment. Talk of Mercedes-Benz’s Mc Laren; it’s rated to be among the very best automobiles for racing. Audi convertibles never cease to amaze. They come with an emotional appeal that a consumer cannot risk buying. Then there is the BMW whose vehicles are rated high because of their Gran Turismo model. The Cadillac is an amazing brand whose proficiency cannot be equated to any measure (Hoffmann and Ivan 56). The Toyota’s Lexus comes in this list as a game-changer. Their products are on point yet affordable. Place market channels These brands share something in common, and this is that they believe marketing is not all about advertising, but what really takes place during the advertising determines the outcome of their product in the market. The auto makers considers the idea of launching more billboards and TV commercials as a supporting role this year to each capture more customers as part of reaching out to its consumers in their communication plan. Price Quality as is expected goes hand in hand with the price. This pentagon does produce automobiles of the highest regard ever seen and as a result, the prices of these vehicles are high. For instance, the Mercedes Mc Laren goes for like $35,000. Promotion Promotions of the Mercedes-Benz, BMW, Lexus, Audi and Cadillac products are usually done using celebrity endorsements in movies or in adverts. The good thing is that they need not to spend much on marketing because they have already established their products and they are identifiable even without publicity (Hoffmann and Ivan 56). But when it comes to launching new products, celebrity endorsements become the new game. GRAPHICAL DATA REPRESENTATION BASED ON PERSONAL PROMOTION, BRAND MOMENTUM AND BRAND SATISFACTION Conclusion The product, place market channels, the price and promotional content all have one thing in common; relativity that enhances the relevance of the automobiles to the market. The U.S. luxury auto market is volatile and intensely competitive. As the Japanese automakers recover from their supply problems, they make the record a wave that may change the rules in the automobile business and completely define new expectations of the consumers. However, much Audi and Mercedes-Benz are dominating the market, the Lexus model should not at any time be disregarded as a cheaper model. There is the Hyundai that is edging into the luxury space and as a result, the overall shape of this sector by 2016 can barely be glimpsed through a (tinted) windshield darkly. Works Cited Avant-garde: Magazine for the Mercedes Benz Club, Manawatu., 2013. Print. Hoffmann, Jonas, and Ivan, Coste-Manière. Global Luxury Trends: Innovative Strategies for Emerging Markets. , 2013. Print. Lacqua, Francine. The Internet Is Ideal Luxury Car Showroom: Doyle. New York: Bloomberg, 2013. Internet resource. Maynard, Micheline. The End of Detroit: How the Big Three Lost Their Grip on the American Car Market. New York: Currency/Doubleday, 2003. Print. Wiehager, Renate. Art & Stars & Cars: On the Occasion of the Automobiles 125th Anniversary: Mercedes Benz Museum Stuttgart, May 10 - September 25, 2011. Ostfildern, Germany: Hatje Cantz, 2011. Print. Read More