Major Marketing Cases - Essay Example

Case Study Target The micro-environmental factors that influenced Target’s performance in the recent years are its consumers and competitors. The successful positioning of Target as an ‘upscale discounter’ by the consumers and the media had a negative effect, when their sales declined during the recent recession in 2008. The consumer’s tendency of viewing its products as superior high priced products, during the economic downfall greatly affected the business. One another reason was the lower prices offered by its competitor Walmart. It impacted the Target’s sales as their customers shifted loyalties towards low-priced Walmart due to their struggling economic conditions. The main macro-economic factors that influenced the Target’s performance during that period were the economic and social conditions that existed among the consumers. Due to the economic recession in 2008, there was a high unemployment level and an increased inflation, which had a direct connection with the sales outcome of the company. Along with this, the purchasing power of the consumers began to deteriorate due to the decline in the income of the sizable households. With the company’s products being viewed as expensive ones, it further impacted Target’s revenues. However, Walmart showed a far better growth due to its cheaper prices strategy hindering the Target’s upscale products. The Target’s “pay less” strategy was a risky one as it has to sustain its high-quality. That is, even while coping up with the changing economic conditions and its consumers’ attitude, it needs to focus on quality. However, it has successfully managed to overcome through the recession crisis and have switched towards a hopeful direction with this new strategy. Despite the high unemployment and increased inflation, Target takes an optimistic view in improving its sales through its new launches such as mini-grocery stores and up-and-up. By focusing on its ‘pay less’ part, Target has certainly pursued a best strategy by retaining the quality of its products even while emphasizing on the discount part. Expanding the advertising campaigns before focusing towards lower prices should have been the alternate strategy for Target during their decline in sales and revenue. As the company was keen on offering one stop shopping with lowered prices and improving the store’s infrastructure, it did not have enough time to analyze the consumers’ tendency towards their products, thereby missed formulating effective advertising strategies. Once they found the necessity of getting the consumer’s focus towards their ‘pay less’ strategy, they started expanding their advertising campaign, which, if done earlier, would have reflected positively in the company sales and growth in the initial days itself. Under the current situation of Target, it would be beneficial to increase the sales through innovative ways such as online shopping, encouraging bulk purchases of products through discounts, offers, etc. In addition, offering discounts for products with rollback prices like the Walmart would also benefit. The best thing I would recommend to the CEO is to retain the high-quality of its products, which is one of the distinct features of the company, thereby keeping it above the rest of its competitors. No matter the increase or decrease in its prices, it should show no compromise towards its products’ quality which would greatly hinder the reputation of Target in the long run. Case Study 2: Porsche Porsche is mainly known as a niche car brand that makes cars for small and distinctive segment of car buyers. This group of buyers belongs to the economically well-off segment of the population, who view car as more of luxury and status symbol than being a utility product. In that direction, Porsche sold very minimum number of its models, thereby creating an image of exclusivity. When viewed from the perspective of the buyers, the Porsche brand kind of played an emotional and also desirable role in defining the self-concept of its buyers. That is, Porsche appealed to the very narrow segment of financially successful individuals, who had an entrepreneurial mindset, even if the worked in a corporation. Due to this entrepreneurial mindset, these individuals set very high goals, and then worked doggedly to achieve them. In addition, they will not settle for anything other than the best when it comes every aspect of life, like the clothes they wear, the restaurant they eat and thereby the cars they drive. Due to this thought process, they wanted to go for a car that reflects or mirrors their optimal self-image. With Porsche attaining the exclusivity tag, it garnered attention among those customer base When these prospective or traditional buyers of Porsche want to go for one of its models, their buyer decision process will border on exclusivity. That is, while normal buyers of cars will look for features like price, fuel economy, etc., so they can use it cost-effectively, buyers of Porsche will look for uniqueness and luxuries, so they can enjoy the car. Enjoyment in the sense, the buyers will want to develop a kind of personal relationship with their cars, so much so that they want the car to sound and vibrate in a certain way, have certain seat materials used, etc. In addition, they want the car to be viewed as a status symbol, which will attract all segments of people, particularly the relatives and friends of the buyers. Although, they were attracting sizable niche segment of the prospective customer segment, Porsche understood that they need to expand their customer segment. With this motive, Porsche started launching many lower-priced models in the 1970s and 1980s. That is, Porsche management felt that it would be difficult to keep their company running by selling only small number cars to exclusive customers. Although, the company was not in favor of launching many new models, it thought of launching at least few more models. In addition, Porsche also had worries that ‘quirky’ nature of the customers who buy Porsches might just run out on them, thus prompting them to launch new models like Porsche 914, Cayenne, Panamera. When these models were launched at slightly lower costs, it brought in different set of customers. Their decision process contrasted with the traditional customers. The new set of customers wanted a quality car at affordable prices, while the traditional customers viewed these entry-level models to be cheap and underperforming. They even dismissed these models as not “real” Porches. In fact, they expressed their displeasure to share their brand with a customer who did not fit into the stereotypical Porsche’s owner profile. Positive and negative attitudes toward a brand like Porsche will normally develop based on the products or models they release and the resultant marketing campaign. When Porsche launched entry-level models, SUV model and four-door model, it earned the disapproval of the traditional customer base. However, Porsche positively changed the consumer attitudes toward the brand by launching those models incorporating optimum quality, features, technologies, etc. When they did that, although those models were different physically, they exhibited the same drive quality of the Porches. Case Study 3: Buick Buick, one of the bestselling auto brands, does not have a truly global strategy, as it relies on its successful regional market of China to promote its product into the global market. Actually, Buick is looking forward to establish its products in the global market through its success in the Chinese market. GM is holding the scope for the Buick in the Chinese market with its new products and successful past trajectory. Globalization of the company is aimed at not exporting its domestic product but rather bringing changes to the products based on Chinese market. That is, it uses its regional market in China as a key driver for getting customer insights in creating its global product. Yes. The GM’s global manufacturing facilities like Shanghai GM, solidifies the global strategy as it brings together the two countries’ economy and consumer culture into a balance. It makes the American brand of Buick to be more palatable for the Chinese buyers, as it is exclusively built in their home country. Typically, it helps the company in reducing its manufacturing costs, and also helps in increasing its global branding by taking advantage of the automobile market demand in China. This integrated production with no localization of its brand name, makes this endeavor a way to the global strategy of Buick. Buick’s global strategy in terms of its products and communication builds a sense of royalty among its consumers, especially through its advertising strategies in which it icommunicates their brand image and its elite designs. Buick has a lineup of several Chinese models built with different designs which have set its pace among the global market. Its global strategy of selling American products changed with the popularity and the influence of the Chinese market among the world. It could be evident through this melange of car models that the Chinese market produces, that it not only sets the designs for Buicks’ future endeavors but also determines the product’s market for the rest of the world. It is probably possible for any of the competitors to replicate the Buick’s strategy in China. However, the creative strategy and innovative designs of GM gives it a competitive advantage over its competitors. The Buick’s success in Chinese market is not a recent phenomenon, but based on long-term success. Also, the way it leverages the global market through their creative approach by transforming their success in the Chinese market into the global environment is incomparable and hardly attainable for any newly emerged competitor to pitch in and replicate easily. As discussed in the case, Buick’s goals for China and the rest of the world has a compelling success in the future years. As the US market for Buick has boomed with increased sales of 52% in 2010, it is expected to have better results in the future years. Also, there is an expectancy of increase in sales in the Chinese market as it is introducing 12 more new models in the future years. Also, the international magazine’s rave reviews of its products like LaCrosse as well as creative designing strategies have given it high potential to strike success in the global market Read More