Final 2009 Mazda6 Competitive Analysis 4 13 08

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Stage-2 marketing research project I\'ve done for Mazda USA in 2008

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Final 2009 Mazda6 Competitive Analysis 4 13 08

  1. 1. 2009 Mazda6 Brand Switching Research Project April 13, 2008 1. Project Objectives The purpose of the 2009 Mazda6 Brand Switching Research Project is to determine who are the best prospects for conquest among current owners of Honda Accords, Toyota Camrys, Nissan Altimas, and Volkswagen Passats. The scope of this research also includes how to conquest these very loyal owners of directly competitive models and what specific marketing initiatives might attract these owners to the 2009 Mazda6. 2. Progress Report This report will cover the secondary research findings as well as a recommendation and timetable to conduct qualitative and quantitative primary research. 3. Secondary Research Methodology Four primary websites were used to analyze customer feedback and compile the secondary research data for this report (www.edmunds.com; www.carsurvey.org; www.mazda6club.com; www.mazdausa.com). In addition, AutoWeek, Car and Driver, and Automotive News were reviewed. Specifically, 854 customer reviews from www.edmunds.com were analyzed (150 total Camry reviews with 50 reviews each year from 2006 to 2008, 150 total Accord reviews with 50 reviews each year from 2006 to 2008, 150 total Altima reviews with 50 reviews each year from 2006 to 2008, 119 total Passat reviews with 50 reviews each year from 2006 to 2007 and 19 reviews for 2008, and 285 total Mazda6 reviews from 2005 to 2008. In addition, 1,293 customer reviews from www.carsurvey.org were analyzed (625 Camry, 1,237 Accord, 336 Altima, 500 Passat, and 93 Mazda6). 4. Conclusions Current Nissan Altima owners are the best candidates for brand switching to the 2009 Mazda6. This recommendation is based on an evaluation of four competitive models’ brand loyalty, share of market, and a newly created Bentley Brand Switching Matrix. This matrix considers the issues of brand loyalty, consumer satisfaction, buyer psychographic similarities, and 2009 Mazda6 product improvements. a. Brand Loyalty Analysis The brand loyalty analysis provides the degree of owner brand loyalty by calculating the percentage of model owners who have made two or more brand purchases. For example, 11% of Mazda6 owners have purchased two or more Mazdas. The 11% is then indexed at 100 to determine which competitive brands provide the most and least loyal owners. The Nissan Altima is the only competitive model which indexes
  2. 2. below the Mazda6 and could provide a 50% easier opportunity for conquest. Camry, Passat, and Accord could be twice or even three times as difficult to brand switch. BRAND LOYALTY INDEX Brand Loyalty Index Altima 5.90% 54 Camry 20.40% 187 Passat 26.40% 242 Accord 32.30% 296 Mazda 10.90% 100 Source: www.edmunds.com b. Brand Share of Market Analysis The brand share of market analysis determines the percentage of a competitive model’s 2007 sales needed to increase Mazda6’s 2009 sales by 50%. For example, if the 2009 Mazda6 sales goal was approximately 90,000 units and the 2007 Mazda6 actual sales were approximately 60,000 units, it would be necessary to conquest 30,000 units. Assuming that all 30,000 units could only come from one competitor, Passat would be the most difficult to conquest, while Altima, Accord, and Camry would be the easiest to brand switch. This is because of Passat’s low volume and Altima, Accord, and Camry’s high unit sales. Approximately 100% of Passat’s 2007 sales would need to defect to Mazda6 in order to increase 2009 Mazda6 sales by 30,000 units, while only 6% to 10% of Altima, Accord, or Camry’s sales would have to brand switch in order to generate 30,000 additional 2009 Mazda6 sales. UNIT CONQUEST ANALYSIS Brand 2007 Unit Sales Required Conquest % Volkswagen Passat 30,575 98.10% Nissan Altima 284,762 10.60% Honda Accord 392,231 7.70% Toyota Camry 473,108 6.30% MAZDA6 60,000 Rounded To Conquest 30,000 Units Source: Manufacturer 2007 Annual Reports c. Bentley Brand Switching Matrix The Bentley brand switching matrix provides a comprehensive analysis of four key components of conquest – brand loyalty, customer satisfaction, buyer psychographic similarities, and 2009 Mazda6 product improvements.
  3. 3. I. Brand loyalty statistics have been taken from the Brand Loyalty Index. II. Customer Satisfaction Scores come from Edmunds.com customer reviews from 2006-2008 (Exhibit One). III. Buyer Psychographic Similarity information has been taken from Edmunds.com customer reviews of brand performance to match Mazda’s Zoom-Zoom marketing strategy. The assumption is that competitive brand owners who value performance would be more likely prospects for the Mazda6 positioning than competitive brand owners who did not value performance (Exhibit Two). IV. 2009 Mazda6 Product Improvement statistics come from a comparison of Edmunds.com competitive brand’s reported product weaknesses from 2006-2008 with the planned improvements for the 2009 Mazda6. The assumption is that a competitive brand owner with specific product problems would be a more likely prospect to switch brands if the 2009 Mazda6 product improvements solved the competitive owner’s product problems. (Exhibit Three) The Bentley Brand Switching Matrix used three different weighting assumptions for the four key conquest components. In each assumption model the Mazda6 total index was 1.00. I. Matrix One weights brand loyalty at 50%, customer satisfaction at 25%, buyer psychographic similarities at 15%, and product improvements at 10%. Using these assumptions, the Nissan Altima is the best opportunity for conquest. (The lower the total score , the more likely the competitive owner would switch to Mazda) Bentley Brand Switching Matrix One Loyalty Satisfaction Psychographics Product Total Altima 0.27 0.25 0.13 0.07 0.72 Passat 1.21 0.25 0.09 0.09 1.64 Accord 1.48 0.25 0.15 0.10 1.98 Camry 0.94 0.24 0.21 0.07 1.46 Mazda 0.50 0.25 0.15 0.10 1.00 Weighting 50% 25% 15% 10% 100% Source: www.edmunds.com
  4. 4. II. Matrix Two weights brand loyalty at 40%, customer satisfaction at 30%, buyer psychographic similarities at 20%, and product improvements at 10%. Using these assumptions, the Nissan Altima is the best opportunity for conquest. Bentley Brand Switching Matrix Two Brand Loyalty Satisfaction Psychographics Product Total Altima 0.22 0.30 0.17 0.07 0.77 Passat 0.97 0.30 0.12 0.09 1.48 Accord 1.19 0.30 0.20 0.10 1.78 Camry 0.75 0.29 0.28 0.07 1.39 Mazda 0.40 0.30 0.20 0.10 1.00 Weighting 40% 30% 20% 10% 100% Source: www.edmunds.com III. Matrix Three weights brand loyalty at 30%, customer satisfaction at 30%, buyer psychographic similarities at 30%, and product improvements at 10%. Using these assumptions, the Nissan Altima is the best opportunity for conquest. Bentley Brand Switching Matrix Three Brand Loyalty Satisfaction Psychographics Product Total Altima 0.16 0.30 0.26 0.07 0.79 Passat 0.73 0.30 0.18 0.09 1.29 Accord 0.89 0.30 0.29 0.10 1.58 Camry 0.56 0.29 0.41 0.07 1.33 Mazda 0.30 0.30 0.30 0.10 1.00 Weighting 30% 30% 30% 10% 100% Source: www.edmunds.com 5. Recommended Primary Research Both qualitative and quantitative primary research are recommended as next steps in the 2009 Mazda6 Brand Switching Research Project. Qualitative research in the form of one exploratory focus group of brand loyal Altima owners will be conducted in the Bentley Center for Marketing Technology. The screen will be current Altima owners who have purchased two or more Nissan’s. The session will explore reasons for Altima brand loyalty, attitudes towards Mazda, Volkswagen, Honda, and Toyota, and what purchasing
  5. 5. incentives would be the most compelling reasons to brand switch. After an evaluation of the focus group session, a web-based Perseus survey would be drafted, approved, and emailed to a national list of 10,000 current Altima owners and analyzed. 6. Timetable and Estimated Costs a. Focus Group: Week Of April 21st ($500 Cost for ten participant $50 Free Gas Cards) b. Email Survey Draft to Henni: April 28th c. Final Survey Approval From Henni: May 9th d. Email Survey Blast: May 13th ($3,300 Total Cost of $500 for ten $50 Free Gas Card s plus $2,800 Mail House Cost for 10,000 current Altima owners) e. Total Primary Research Cost: $4,000 f. Draft Report: May 20th g. Final Report: June 1st
  6. 6. EXHIBIT ONE CUSTOMER SATISFACTION SCORES Nissan Altima Altima model changed in 2007, Mazda model remained unchanged. Source: Edmunds.com Altima customer satisfaction is improving every year. The most positive mentioned features are high mpg, sporty handling, high-tech interior gadgets and its automatic transmission (CVT). However, Altima has low brand loyalty and it has the most criticized interior quality.
  7. 7. Toyota Camry Camry model changed in 2007, Mazda model remained unchanged. Source: Edmunds.com customer review 2006-2008 Camry customer satisfaction has deteriorated since 2007 because of serious automatic transmission problems (40.0% of the 2007 model owners and 36.4% of the 2008 model owners complained about transmission problems). Interior quality was also criticized. Honda Accord Accord model changed in 2008, Mazda model remained unchanged. Source: Edmunds.com customer review 2006-2008
  8. 8. Accord customer satisfaction has deteriorated since 2007 because of the new Accord’s reduced mpg as a result of increased power and its new transmission technology (VCM). VW Passat Passat model changed in 2006, Mazda model remained unchanged. Source: Edmunds.com customer review 2006-2008 Despite Passat’s bad reviews in various consumer reports and major websites, customer satisfaction has improved steadily since 2004. Passat has high scores in fuel efficiency and performance which usually contradict each other. Passat also scores well in build quality but suffers from inconsistent reliability. Customer Satisfaction Score Summary Brand Satisfaction (Ten Scale) Index Altima 9.10 100 Passat 9.02 99 Accord 9.04 99 Camry 8.70 96 Mazda 9.10 100 Source: www.edmunds.com 2004-2008 5 years average customer satisfaction score
  9. 9. EXHIBIT TWO BUYER PSYCHOGRAPHIC SIMILARITIES Brand Performance Index Altima 37.30% 0.86 Passat 57.50% 0.59 Accord 29.20% 0.98 Camry 0 1.38 Mazda 72.60% 1.00 Source: www.Edmunds.com EXHIBIT THREE COMPETITIVE BRAND PRODUCT WEAKNESSES VERSUS 2009 MAZDA6 PRODUCT IMPROVEMENTS Brand Product Weakness Index Altima Interior Quality 0.74 Passat Reliability 0.89 Accord Fuel Economy 0.96 Camry Transmission 0.71 Mazda 1.00 Source: www.Edmunds.com

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