Saturn branding and positining case


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Saturn branding and positining case

  1. 1. Assessment History and trend. In US the industry began to change in the 1950s when foreign car makers like Toyota, Honda and Volkswagen offered American consumer‟s smaller cars at lower prices which became major trend and the quality of import cars are far better than US. General Motors seems to be helpless to sale their cars in front of the competition of import cars. Customers are more focused for value in the car which they were getting from imported cars. Imports had claimed a 10.1 percent market share by 1959. This series of events confirmed in some people's minds the suspicion that U.S. automakers couldn't produce small cars competitively. As smaller cars were widely believed to represent the future direction of the industry. Action  At U.S. Saturn decided that it needed to “start from the beginning,” unconventionally launch this brand, and do so “from the inside out. An internal project to build an affordable, high-quality, small car to compete with the imports was approved in May 1982  The project had been dubbed "Saturn," a reference to the Saturn rocket that propelled the American astronauts to the moon during the space race with the Soviet Union. Operational strategies  Saturn was developed by GM as a separate brand and independent subsidiary in the late 1980s, to deal with the shrinking domestic market share for passenger cars.  Saturn started strong, building a company centered on making a small car of superior quality and value as efficiently as possible, while combining the most advanced technology with the newest approaches to management.  The Group of 99 were designated to identify key founding principles for Saturn and to search the world for the best ideas in all areas. The group consisted of a functional cross- section of people, including plant managers, superintendents, union committee members, production workers, and skilled tradesmen, as well as UAW and GM staff from 41 UAW locals and 55 GM plants.
  2. 2. Marketing strategies  Saturn has tried to uphold its image as "a different kind of company" To do this, it has concentrated on creating and maintaining a strong relationship with its customers.  Based upon the profile of imported car buyers, the targeted Saturn consumer would be an average of 38 years old, earning an average of $51,000 annually and mostly baby boomers. A large percentage would live on the West Coast and 50 percent would be college graduates.  The Saturn Marketing Planning Team incorporated the ideas of 16 dealers representing 25 manufacturers. The team studied distribution methods of 30 major U.S. corporations and came up with Saturn's Market Area Approach (MAA), which was announced on May 26, 1987. MAA set up 300 "territories" to be handled by individual franchised dealers.  Saturn dealers were trained in low-pressure sales and were encouraged to pay salaries rather than commissions.  An important step in defining Saturn's marketing strategy was the selection of an advertising agency. The Hal Riney & Partners agency was named as Saturn's "communications partner" on May 24, 1988. Riney set about creating a "charismatic brand."  Promotional strategy of Unique, "folksy", "straight-talk", $100M+ consumer ad campaign, building a focused brand image, using themes such as Saturn employees' enthusiasm, and dedication to building cars "in a brand new way" with US can-do spirit  Saturn advertising was designed to be emotionally driven, with a focus on the human element rather than the product.  In the film, team members explained what the project meant to them. In the words of a Riney executive, "We wanted to get people rooting for Saturn, the company." Advertising Slogan which was made "A Different Kind of Car Company"
  3. 3. SWOT Analysis of Saturn Strengths Weaknesses Marketed itself as a "different kind of car company," Too much early success causing a shortage problem due to unwillingness to see the need for revising the strategic market plan Potential for financial support from GM Potential reluctance of GM to invest more money in the Saturn project Cost efficiency and concern for employees in the manufacturing plant design Some labor unrest when attempts were made to increase production resulting in higher defect rates People oriented philosophy in all operations Limited product line Opportunities Threats Perception by consumers of Saturn as a high quality replacement for imports Competition from Japanese subcompact imports Satisfied Saturn buyers moving on to intermediate models or sport utility vehicles Strong U.S. dollar has made Saturn models more expensive compared with Japanese competition Sizeable small car market in Japan Market strategy may be easily emulated by Ford, Chrysler, and subcompact imports Shift in demand away from compacts to sport utility vehicles Lower fuel prices
  4. 4. Strategic issues Branding  Sticker Price Comparable to Competition  Saturn buyers' lifestyles, playing up baby boomer themes of utility, value and safety and Brand focus strengthened by using model numbers not names.  Satisfied value of quality and Best resale value than others car companies. Positioning- “a different kind of company”  Slogan helps to crystallize the values and culture of the firm  Important part of its brand equity  This position captures the unique way in which Saturn interacts with its customers  It allows a host of specific features and programs to be introduced without confusion.  Centre of gravity for the program Creating Perceptions by selling the Company and not the Car.  Customer Perceptions are what counts and perceptions do not automatically follow reality.  The solution was to sell the company-its values and culture, its employees and its customers –rather than the car  Visual Imagery of the Spring Hill Plant  Distanced Itself from GM because the focus was to be on Saturn Creating a Relationship between Saturn and the Customer  Eliminated price haggling, dealing, rebates and discounts  Brand Identity: Treat Customers like friends and with respect  Saturn is young at heart, genuine, honest, friendly, down to earth and someone who cares about individuals and competent and reliable  Patriotism: Spring Hill Plant
  5. 5. Integrated Communication  Consistency Across Media  „Spring in Spring Hill‟ Infomercial  Did a lot of work to ensure that retail effort was on strategy