Positioning the New Beetle
Why would positioning the New Beetle be considered Mission Impossible? Ventura knows the importance of a good segmentation, targeting and positioning for a successful marketing strategy, that is the reason why she is concerned about the strategic triangle for the New Beetle and its consequences on the sales growth goal. Additionally, she feels the pressure for an amazing marketing campaign since the previous ones were so viral and spoken about.
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Positioning the New Beetle is a hard task for several reasons: 1) There are two attractive and distinct segments to which Anton attend without damaging its current positioning and brand awareness since it has been seen as an affordable and young brand. These two potential target segments are the baby-boomers and the 18- to 34-year-olds, the last is the brand’s current target, achieved through the Drivers Wanted campaign.
The baby-boomers segment is constituted by former Beetle users, who are now older and enjoy larger cars like SUB, however the New Beetle brings back several good memories which induce the desire to be back in those youth days creating nostalgic feelings that can e translated into sales. The 18- to 34-year-olds segment is composed by young and adventurous people, who enjoy an active driving experience, who want to be challenged and defy rules.
On one hand, we have an older segment that already made some pre-orders and which is willing to pay a premium price, however there is the possibility that the sales will be only the pre-orders since this segment prefers a different type of cars nowadays. On the other hand, we have a younger segment, that is larger and has more potential to influence Beetle’s sales in the long run, but it has rice constraints. 2) Wed current strategy is to be an affordable brand that provides an unique driving experience through connecting the driver to the road and to the world.
This predefined goal was achieved by the Drivers Wanted campaign. This campaign was part of the strategic recovery plan to US ‘vow. The goal was to bring back the excitement while appealing to a new generation of consumers who were young, educated, adventurous, creative and self-confident, who also played an active role in driving, enjoying challenges and defying rules. The campaign had its results – increasing the sales and reaching an younger segment of drivers.
These results can be reversed if the New Beetle is targeted to the baby-boomers because it will impact the brand awareness since it will no longer be seen as young. 3) There is an important question about whether introduce the New Beetle under the Drivers Wanted campaign or not. Despite the target segment (18- to 34) being the same as the Drivers Wanted campaign, it is my opinion the New Beetle should not be introduced under this umbrella because it has the potential to attract customers room other segments (baby-boomers) who don’t identify themselves with this campaign.
Hence, I propose a new campaign that endorses the New Beetle features such as water cooled engine, airbags, air conditioning and six-speaker sound system (youth) and which also shows its values such as honesty, simplicity, originality, reliability, superior driving performance and all the characteristics that are common to both segments. 4) Pricing is a complex issue due to the existing two segments. The baby-boomers can pay a higher price but the 18- to 34-year-olds cannot. Also has Additionally low prices means unattractive/unhappy dealers.
This dilemma contributes to the impossible mission of positioning: is Wed an affordable brand or not? Is it in the small-car market or in the premium one? 5) Finally, we have the budget issue. Whatever the target will be, there is a threat that Wed will not able to communicate and position itself. Since the advertising budget is the smallest of the market, if not properly allocated to the several media or if the campaign doesn’t draw the segments attention, the sales goals will be at stake.
For all the reasons mentioned above, positioning the New Beetle is an impossible mission. What are the pros and cons of each positioning option? What positioning would you choose and why? There are two positioning options: The baby-boomers segment and the 18- to 34-year-olds. Baby-boomers Pros: the possibility to charge a premium price, the pre- orders already made, their wish to go back in time and ride a Beetle again.
Baby- boomers Cons: damaging the current awareness of an young and active brand and consequently reducing other models sales, the taste for larger cars like Subs makes it questionable the long run sales. 8- to 34-year-olds Pros: higher potential sales in the long run, growing segment and market, following the current brand strategy as young and active, it is possible to still take advantage of the Drivers Wanted campaign returns. 18- to 34-year-olds Cons: price constraints, strong competition with other models outside and inside Wed range.
Daniel Hanoverian points out in Rediscovering Market Segmentation three main reasons for segmentation failures, one of them is to put too little emphasis on current consumer behavior. In my opinion should focus on its current target market instead of the baby-boomers. All the pre-orders the New Beetle has are from this clients, which proves they will buy the car if they wish so even without a marketing campaign focused on them. However, current target needs these campaigns as a way to incentive them to buy the model.
Since Wed has a tiny little budget for advertising when compared with competitors, it should use all pennies to convince young drivers to buy the New Beetle, proving them the car not only has style, but also has an upfront technology, as well as lots of space and comfort. The market research concluded that the two segments, despite the demographics differences, had some common characteristics such as confidence, individualism and a desire to be the center of attention.
I believe the baby-boomers would react positively to a marketing campaign directed only to the 18-34 years olds target segment because it would create the youth feeling and the desire they are actually looking for when buying the new model (pre-orders) since it remembers them the old days. Hence, positioning the New Beetle to the current target segment would not narrow the sales to the baby-boomers segment and would cost the sales of the model, bringing the sales volume to the goal wants to achieve.
Hence, I would choose the 18- to 34-year-olds segment and I would positioning the brand as young, active, innovative despite keeping some good traditions, challenging, and adventurous. To achieve this positioning I would reduce the Drivers Wanted campaign in order to have budget to a new campaign focusing on the New Beetle launching. I would not cancel the previous campaign because do not want to be a single model brand. Related to the media, I would focus on TV ads but also on some billboards and ads in two magazines – Sports Illustrated and