2. Branding The Beetle
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3. Volkswagen trying to re-launch its Old and best-
“Beetle”in US market.
A decade ago Beetle was USA‟s one of the best
selling cars, but due to non compliance of few new
homologation rule they stopped selling it in USA.
Volkswagen
It is a German auto car maker since 1938 .
It entered in American market in 1949 and by 1968 it was selling
half of a million cars.
4. Beetle- “One of the most successful car in USA” recorded more
than 50% total car sales of Volkswagen in USA in 1960‟s.
During 1980’s the beetle run in the US ended due to non compliance
of new homologation requirements namely National highway act &
Clean air act.
During the same period the Beetle sales hit the all time low due to
a) Heavy competition from new and advance Japanese brands.
b) Exchange rate volatility.
5. As a result of all the reasons state above the total sale of
Volkswagen cars in US market were at all time low. In the year
1993 the numbers have dropped 49533 from 569696 of 1970.
600000
500000
400000
Year
300000
Total VW
200000
100000
0
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49
6. In 1994 Volkswagen team brain storm at the
reason and remedies of the falling sales in USA.
They decided to reintroduce their best oldie in
new avatar.
7. While starting with the work of reinventing the Old Beetle
Volkswagen team with the help of Arnold communication did a
extensive market research to understand the new age customers
and their perception regarding the VW and Beetle.
Arnold communication covered 95 out of 100 top dealers
Drove the VW car for more than 50000 miles to understand
themselves.
8. After the Market research the Arnold team came up with
following option for the VW team.
A new campaign is required to boost the sales of existing VW
models in the market
“Drivers Wanted”
And Beetle will have to over come following issues in the process
of new launch
9. How much of the car‟s heritage should the new positioning use to
leverage?
Play on the nostalgia
Appeal to the new generation
10. How to rebuild VW‟s image through the New
Beetle?
Belief that VW product line is tired and old compared to
Japanese cars.
Overall Opinion VW and Key Competitor- U.S.
100
% Excellent/Good Opinions
90
80
70 VW
60
Nissan
50
Saturn
40
30 Toyota
20
10
0
Dec-95 Mar-96 Jun-96 Sep-96 Dec-96 Mar-97 Jun-97 Sep-97 Dec-97
Time
11. How to rebuild VW‟s image through the
New Beetle?
Improve the reliability
Make regular innovations
Strengthen its brand equity
12. Price
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10000
15000
20000
25000
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Price of Small Cars 1998 - U.S.
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This is in contrast with VW‟s heritage of affordability.
What would be the pricing strategies of the New Beetle?
14. The New Beetle : What it was?
• Successor to the most successful car of its time - the original Beetle
• Pressure to live up to the legacy
• Strategic importance to revive VW in America
• Old and new ads
15. The Design
• Challenge: to combine the equity of the past with the design
geometry of the future
• The four design principles - Honest, Simple, Reliable and Original
• Round shapes - Inviting, Friendly, Completeness
• Iconic design meets state of the art German engineering
• 1993 - The Concept 1
16. Positioning the New Beetle
• Turn the excitement surrounding the car into actual sales
• Identify a target market and develop a compelling value proposition
• Market research - polarizing opinions
• Taking the opinions of - consumers, dealers, sociologists
• “The toy car” tag
• Drivers Wanted campaign?
17. The Beetle Customer
• Demographically diverse
• 18-to-34 year olds/Baby boomers
• Qualities - Confidence, individualism and desire to be center of
attention
• Love of driving, spirited design, German engineering
• Shift from People‟s car to Personal car
18. The Engineering
• Engineered based on the top-of-the-line Golf platform
• Front-housed engine, water cooled
• Four wheel disc breaks
• Access to 12 cubit feet of storage space in rear hatch
• Front and side airbags, air-conditioning, six-speaker sound system
now included in the standard package
• The implication - higher price tag
20. Product : More than Vehicle
• German Engineering
Reliability High
• Cutting edge technology
• Up to Date elements
High
VW New
• Superior driving Performance Beetle
Uniqueness
• Spirited Design Domestic Japanese Cars
• Circular shapes Cars (Ford, (Toyota,
Chevrolet) Nissan)
• Heritage & Originality
• Six vivid Colors
21. Price : Small but High-end Car
Price in US Small Car Segment in 1998
• Price Segment
25000
20000
20000 17239
• Range was $ 11000 - $ 17500. 15200 15200 15200 14600 14400
14000 13600 13500 13500
Price in $
15000 13000
12000 11035
• Beetle base model $ 15200. 10000
5000
0
• Competitors
• Domestic brands (Chevrolet, Ford)
• Japanese car manufacturers (Toyota, Nissan) Cars
• Premium Price Strategy
• 3 Premium : Performance, Heritage, Design
22. Place : Dealers & Flagship Stores
• VWV (VW Value-sharing Program)
• German management, Loyalty, Motivation
• Flagship store : Museum of the New Beetle
• New York, LA, San Francisco
• Pop-up Store, Show-case
• Lease than purchase ‐ Financial Support Program
23. Promotion : Not widespread but Focused
• Journalists invited to Wolfsburg, Germany
• Meet with management and preview New Beetle
• Drive Beetle for 1 day & 1 night through different communities
• TV commercial: „Drivers Wanted‟ by VW
• Focused on Print Media : Magazines
• Car & Driver, Motor Trend, Automobile Magazines
• Architectural Digest, Vogue, Spin
28. Recommendations : Approaching the Customers
• Two generations in target audience: Baby Boomers and Young
Generation
• More effort should be focused on campaign to attract Young
Generation consumers and appeal to their mentality, behaviour
and attitude.
• A campaign for Baby Boomers would be straightforward by
using nostalgic images to bring back good memories from the
past and rekindle their interest in the Beetle.
29. Recommendations : Pricing Options
• Two/Three stage price strategies.
• Two or more variants with different configurations
30. Recommendations : Media Channels
• There‟s an opportunity to use the positive media coverage to
Volkswagen‟s advantage. Get the media involved to spread the
word about the Beetle!
• Other suggested options to increase Beetle‟s exposure: Print
Advertising in magazines and showcasing car at big events.
• Exploit the Secondary source of Brand Knowledge.
