This document discusses research on consumer behavior and perceptions regarding luxury automobiles. It notes that while much research has focused on low-priced vehicle segments, luxury vehicles involve greater influence of brand image and individual buyer preferences. The document also examines differences between fleet/business buyers and retail/individual buyers, and how attitudes and importance of various vehicle attributes can differ between the two groups. Finally, it proposes a set of attitude variables that may influence potential luxury vehicle buyers, such as reliability, quality, and style.
The document discusses using the brand resonance model to build a car brand. It explains the brand resonance pyramid, which has five levels: salience, performance/imagery, judgments/feelings, and brand resonance. It then provides an example of how to apply this model to the car brand DC Cars. At each level of the pyramid it gives details about DC Cars' brand salience as a luxury manufacturer, its performance in safety innovations, how customers judge and feel about its prestige and quality, and examples of brand resonance through social media following and owner clubs. The pyramid model is presented as a way to measure how well a brand meets customer needs and wants to create resonance.
In the Year of the Horse, there is no letting up in China’s passion for luxury horsepower. Despite concerns over economic slowdowns and government regulations, the number of new manufacturers and new models competing in this sector continues to grow.
In ‘Auto insights: the luxe edition’, we’ll take you on a tour of the high-end of the auto market and the changing meaning of luxury itself, including:
The document discusses various strategies for managing branding and extending brands, including using product, line, range, and umbrella brands. It notes reasons for extending brands like increasing competition and market saturation. Brand stretching involves transferring brand values to new markets but risks diluting the brand identity. Keys to successful brand extensions are a strong brand identity, relevance to new markets, and added value. Examples are given of both brand extensions that succeeded and failed.
This document provides an overview of BMW's global strategy, including its product lines, key consumer segments, challenges, competitors, and recommendations. It discusses BMW's revenues, vehicle and motorcycle sales, market share, employees, and dealership reach. Two main consumer segments are described as "Successful and Show" and "Go-Getters and Big Dreamers." Challenges include expanding into new markets, meeting emissions standards, and competing with tech-focused automakers. Competitors discussed are Mercedes, Audi, Tesla, Google, and Faraday. The future is predicted to include connected cars, customized lighter vehicles, and the rise of Asia Pacific and self-driving technologies. Recommendations center on investing in new markets,
The document discusses current and future marketing strategies for BMW. It provides details on BMW's business segments, brands, model series, sales figures, target markets, competitors, and marketing mix. Regarding BMW's marketing mix, the document outlines BMW's product portfolio and life cycles, pricing strategy, distribution network, and promotional campaigns/slogans. It emphasizes BMW's focus on the driving experience, quality, and premium brand image in its marketing strategies.
BMW is introducing its new P-Series pickup trucks targeted at the international premium automobile market. The strategic marketing plan outlines 4 new pickup truck models ranging in price from $36,959 to $71,279. It is estimated that the P-Series could see a 253% growth over the next 5 years, with projected sales of over 11,000 units. The plan details BMW's marketing strategy, which will utilize digital advertising, social media, dealerships and online sales channels. It projects $943 million in global sales and 166 million in profits by 2019 as BMW leverages its brand reputation for quality and innovation to enter the pickup truck segment.
Global brands allow companies to achieve economies of scale in production and marketing. However, some national brands are better suited to local tastes and cultures. The document discusses the advantages and risks of both global and national brands. It concludes that companies should use global brands where possible but national brands where necessary to adapt to local conditions.
Analyse Marketing Communicatie Plan BMW-i_final (15)Tim Hindriks
This document analyzes the Dutch electric vehicle (EV) market and potential target groups for BMW's new electric vehicle, the BMW i3. It provides an overview of the growing Dutch EV market and expected growth by 2020. It analyzes three potential customer groups - families, young professionals, and elderly people - and determines that the wealthy elderly are the best target group for the BMW i3 in the Dutch market. The elderly are more knowledgeable about sustainability, have a sustainable attitude, and buy the most new cars and segment B cars compared to the other groups.
The document discusses using the brand resonance model to build a car brand. It explains the brand resonance pyramid, which has five levels: salience, performance/imagery, judgments/feelings, and brand resonance. It then provides an example of how to apply this model to the car brand DC Cars. At each level of the pyramid it gives details about DC Cars' brand salience as a luxury manufacturer, its performance in safety innovations, how customers judge and feel about its prestige and quality, and examples of brand resonance through social media following and owner clubs. The pyramid model is presented as a way to measure how well a brand meets customer needs and wants to create resonance.
In the Year of the Horse, there is no letting up in China’s passion for luxury horsepower. Despite concerns over economic slowdowns and government regulations, the number of new manufacturers and new models competing in this sector continues to grow.
In ‘Auto insights: the luxe edition’, we’ll take you on a tour of the high-end of the auto market and the changing meaning of luxury itself, including:
The document discusses various strategies for managing branding and extending brands, including using product, line, range, and umbrella brands. It notes reasons for extending brands like increasing competition and market saturation. Brand stretching involves transferring brand values to new markets but risks diluting the brand identity. Keys to successful brand extensions are a strong brand identity, relevance to new markets, and added value. Examples are given of both brand extensions that succeeded and failed.
This document provides an overview of BMW's global strategy, including its product lines, key consumer segments, challenges, competitors, and recommendations. It discusses BMW's revenues, vehicle and motorcycle sales, market share, employees, and dealership reach. Two main consumer segments are described as "Successful and Show" and "Go-Getters and Big Dreamers." Challenges include expanding into new markets, meeting emissions standards, and competing with tech-focused automakers. Competitors discussed are Mercedes, Audi, Tesla, Google, and Faraday. The future is predicted to include connected cars, customized lighter vehicles, and the rise of Asia Pacific and self-driving technologies. Recommendations center on investing in new markets,
The document discusses current and future marketing strategies for BMW. It provides details on BMW's business segments, brands, model series, sales figures, target markets, competitors, and marketing mix. Regarding BMW's marketing mix, the document outlines BMW's product portfolio and life cycles, pricing strategy, distribution network, and promotional campaigns/slogans. It emphasizes BMW's focus on the driving experience, quality, and premium brand image in its marketing strategies.
BMW is introducing its new P-Series pickup trucks targeted at the international premium automobile market. The strategic marketing plan outlines 4 new pickup truck models ranging in price from $36,959 to $71,279. It is estimated that the P-Series could see a 253% growth over the next 5 years, with projected sales of over 11,000 units. The plan details BMW's marketing strategy, which will utilize digital advertising, social media, dealerships and online sales channels. It projects $943 million in global sales and 166 million in profits by 2019 as BMW leverages its brand reputation for quality and innovation to enter the pickup truck segment.
Global brands allow companies to achieve economies of scale in production and marketing. However, some national brands are better suited to local tastes and cultures. The document discusses the advantages and risks of both global and national brands. It concludes that companies should use global brands where possible but national brands where necessary to adapt to local conditions.
Analyse Marketing Communicatie Plan BMW-i_final (15)Tim Hindriks
This document analyzes the Dutch electric vehicle (EV) market and potential target groups for BMW's new electric vehicle, the BMW i3. It provides an overview of the growing Dutch EV market and expected growth by 2020. It analyzes three potential customer groups - families, young professionals, and elderly people - and determines that the wealthy elderly are the best target group for the BMW i3 in the Dutch market. The elderly are more knowledgeable about sustainability, have a sustainable attitude, and buy the most new cars and segment B cars compared to the other groups.
The document discusses a marketing workshop for developing a publicity campaign for the 2013 MINI Cooper Coupe. It outlines the brand brief, target demographics of young, educated professionals, and competitors. It also provides sales data on BMW subsidiaries including record MINI sales in 2011. The workshop aims to position MINI as customizable and environmentally friendly to address consumer trends and further momentum in 2012 with new models.
This document provides a project report on brand management of BMW. It includes a brand inventory section which discusses BMW's history since 1913 and its expansion globally. It also outlines BMW's current brand portfolio including BMW, Mini, and Rolls-Royce brands. The next section analyzes BMW's brand equity through a customer-based brand equity pyramid and mental map. It identifies BMW's strong brand awareness and associations with luxury, performance, and German engineering. The report concludes with recommendations for BMW to address increasing competition through differentiated new technologies, addressing different consumer groups, and strengthening customer relationships.
Market Segmentation and Targeting with BMWPankaj Chauhan
BMW is one of the best Luxury car Brand available throughout the globe. BMW target only selective segments. This PPT is about different types of Segments available in a genrel market and how BMW has target few of them
Please visit here for voice over presentation https://www.youtube.com/watch?v=_Ha614-Daug
Disclaimer: Lot of material is taken up from Internet. I was not able to give acknowledgment as i lost the track of sources. In case any copyright material used please let me know. Thank You
In the two decades that Y&R’s BrandAsset® Valuator (BAV®) - the world’s largest database of brand perceptions - has studied the brandscape, brands have become 200% less distinct from one another. Marketers must work harder than ever in order to make their brands stand out. But how? By studying thousands of brands - from the most iconic to the most commoditized - we found that breakaway brands have an inherent tension that makes them irresistible. We call this BRAND TENSITY®
The document outlines standards for BMW brand design in promotional print media. It provides guidelines on the new BMW sender designation which focuses more clearly on the BMW brand using enlarged symbols and identity modules. Examples are given of the new design format for brand and product communications, outlining key elements like headlines, subheadings and legal disclaimers. Typography, formatting and placement of elements are also addressed to ensure consistent branding across print promotions.
The document discusses BMW's product line and marketing strategies. It notes that BMW was originally an aircraft engine manufacturer and now focuses on luxury and performance vehicles. It describes BMW's typical customer as well-educated, high income individuals. BMW had success with viral marketing films in the early 2000s. The document recommends that BMW focus on long-term strategic objectives to attract younger customers and avoid alienating existing customers, while reinforcing its prestige brand image and competing against automakers with larger marketing budgets.
BMW has achieved market leadership in the luxury car segment in India for the second consecutive year. It currently has a 43% market share and saw sales growth of 73% in 2010. To maintain this lead, BMW plans to increase its market share in the SUV segment to 10% by the end of 2011. It will promote its new X1 SUV through an extensive advertising campaign including TV, print, internet and mall promotions. The total estimated budget for the 2-month campaign is Rs. 22.68 crores.
Mercedes-Benz IMC Marketing Campaign by Miles MinnaarMilesMinnaar
An IMC Marketing Campaign I created for my introduction to advertising class I took in 2020. Special thanks to Barry Smith, my professor, for teaching me.
This document summarizes a marketing case study presentation by Group 3 on BMW's "Company of Ideas" campaign that targeted the "creative class". The campaign aimed to expand beyond BMW's traditional "yuppie" customer segment by targeting young urban professionals working in creative fields. The presentation analyzes whether the campaign was necessary given BMW's performance in 2005 and discusses criticism that BMW lost its soul by shifting its target market. It also provides a SWOT analysis of the campaign and lessons learned around segmentation and targeting.
Lamborghini is analyzing luxury electric vehicle brands' communication strategies to inform their own plans. This document discusses Tesla's narrative and objectives, compares its advertising to BMW's, and proposes a start-up marketing strategy for Tesla emphasizing storytelling, social media, and grassroots events to build its brand identity and engage customers around reducing carbon emissions.
A brand is forever! A framework to revitalizing the declining and dead brandSameer Mathur
Managerial actions, environmental factors, and competitive actions can all contribute to brand decline over time. However, some brands are able to be revived through strategic revitalization efforts. There are three key steps to reviving a declining brand: 1) assessing whether the brand is still worth investing in based on residual value and equity; 2) developing a long-term strategy to reposition the brand, invest in improving its image, and educate the market; and 3) correcting any past mismanagement issues by improving quality, refining the target market, and resisting urges to lower prices. With the proper diagnosis and execution of a revitalization plan, declining brands can potentially be strengthened and revived.
The marketing plan summarizes BMW's M3 sports car. It discusses the company background, product description, target market, pricing, placement, and promotional strategies. The M3 is a high-performance luxury sports car with over 400 horsepower. BMW targets wealthy individuals seeking a fun and prestigious vehicle. They employ an indirect distribution model and promote through advertising, websites, and sponsoring racing teams to build the brand.
The document summarizes BMW's "HyoRee's Anystar Campaign" marketing campaign from 2001. The goals of the campaign were to sustain growth, attract young customers without alienating existing customers, and strengthen BMW's luxury brand image. The campaign was successful, achieving a 13% sales increase in 2001 and strengthening BMW's brand perception among younger demographics. The document evaluates the success of the campaign and recommends continuing the campaign approach through producing additional short films for distribution online and through DVD, as this leverages the prior success while being cost-effective.
This document discusses characteristics of successful global brands. It identifies vision, invention, and dynamism as key traits of brands that are growing in worth. Vision involves embodying a clear direction and point of view. Invention requires continuous innovation and new experiences. Dynamism generates popular culture through marketing events. Additional characteristics discussed include balancing global and local aspects, having a universal idea rooted in brand truth, and creating a community through shared experiences.
This in-depth brand report summarizes BMW's luxury SUV brand performance in the UK for July 2014. The report includes sections on insights and recommendations, CEO dashboard metrics, spike analysis of key metrics, analysis of Facebook and Twitter pages, audience demographics, and competitors. Key findings include that 26.7% of BMW SUV conversations occur on forums where people ask questions; BMW leads in share of voice but could be more active socially; and there is some online criticism of minor vehicle faults that goes unanswered. The report provides recommendations such as actively engaging on forums, providing technical support online, and monitoring spikes in sentiment around new vehicles.
The document analyzes Jaguar's strategy in introducing its new X-Type vehicle into the low-price luxury vehicle segment. Jaguar hopes to capture younger customers and increase loyalty through this strategy, as well as increase revenues and margins through aggressive growth. However, Jaguar has faced some problems with poor reviews of quality, producing more vehicles than demanded, and aggressive pricing hurting its brand image. The document recommends Jaguar maintain autonomy, improve production quality to attract customers and leave a good impression, and pursue growth in line with demand to limit discounting. If these measures are enacted, Jaguar will be successful growing sales, attracting new customers, and maintaining its brand image.
Lexus is the luxury vehicle division of Toyota Motor Corporation. It employs a differentiation and low-cost strategy to compete in the luxury vehicle market. While Lexus has strong brand recognition and global presence, its production is concentrated in Japan, resulting in high shipping costs. Opportunities for Lexus include growing demand for hybrid vehicles and emerging markets in China and India. However, threats include rising fuel costs, stiff competition, and the impact of Toyota's recent recalls.
The Hyundai Genesis targets baby boomers and high tech professionals with its class-leading performance and fuel efficiency at a lower price point than competitors like the Lexus and Infinity. Intense competition in the luxury sedan market applies pricing pressure as automakers use incentives to attract customers. However, Hyundai has gained market share through high quality, safety, and value. The emergence of foreign automakers like Hyundai also increases competition, while high gas prices could threaten large vehicle sales if customers seek alternatives.
- The Mercedes A-class was launched in 1997 as a compact car to expand Mercedes' product portfolio and attract younger customers. It targeted professionals and couples with a small family income.
- While it faced competition from BMW and Audi in the premium compact segment, its positioning under the Mercedes brand helped establish its luxury credentials. However, it was initially not marketed in the US and Asia due to cultural preferences.
- The A-class suffered a major setback when motoring journalists published that it failed a key safety test, but Mercedes redesigned the chassis to address the issues and regain customer trust in the brand.
The document discusses a marketing workshop for developing a publicity campaign for the 2013 MINI Cooper Coupe. It outlines the brand brief, target demographics of young, educated professionals, and competitors. It also provides sales data on BMW subsidiaries including record MINI sales in 2011. The workshop aims to position MINI as customizable and environmentally friendly to address consumer trends and further momentum in 2012 with new models.
This document provides a project report on brand management of BMW. It includes a brand inventory section which discusses BMW's history since 1913 and its expansion globally. It also outlines BMW's current brand portfolio including BMW, Mini, and Rolls-Royce brands. The next section analyzes BMW's brand equity through a customer-based brand equity pyramid and mental map. It identifies BMW's strong brand awareness and associations with luxury, performance, and German engineering. The report concludes with recommendations for BMW to address increasing competition through differentiated new technologies, addressing different consumer groups, and strengthening customer relationships.
Market Segmentation and Targeting with BMWPankaj Chauhan
BMW is one of the best Luxury car Brand available throughout the globe. BMW target only selective segments. This PPT is about different types of Segments available in a genrel market and how BMW has target few of them
Please visit here for voice over presentation https://www.youtube.com/watch?v=_Ha614-Daug
Disclaimer: Lot of material is taken up from Internet. I was not able to give acknowledgment as i lost the track of sources. In case any copyright material used please let me know. Thank You
In the two decades that Y&R’s BrandAsset® Valuator (BAV®) - the world’s largest database of brand perceptions - has studied the brandscape, brands have become 200% less distinct from one another. Marketers must work harder than ever in order to make their brands stand out. But how? By studying thousands of brands - from the most iconic to the most commoditized - we found that breakaway brands have an inherent tension that makes them irresistible. We call this BRAND TENSITY®
The document outlines standards for BMW brand design in promotional print media. It provides guidelines on the new BMW sender designation which focuses more clearly on the BMW brand using enlarged symbols and identity modules. Examples are given of the new design format for brand and product communications, outlining key elements like headlines, subheadings and legal disclaimers. Typography, formatting and placement of elements are also addressed to ensure consistent branding across print promotions.
The document discusses BMW's product line and marketing strategies. It notes that BMW was originally an aircraft engine manufacturer and now focuses on luxury and performance vehicles. It describes BMW's typical customer as well-educated, high income individuals. BMW had success with viral marketing films in the early 2000s. The document recommends that BMW focus on long-term strategic objectives to attract younger customers and avoid alienating existing customers, while reinforcing its prestige brand image and competing against automakers with larger marketing budgets.
BMW has achieved market leadership in the luxury car segment in India for the second consecutive year. It currently has a 43% market share and saw sales growth of 73% in 2010. To maintain this lead, BMW plans to increase its market share in the SUV segment to 10% by the end of 2011. It will promote its new X1 SUV through an extensive advertising campaign including TV, print, internet and mall promotions. The total estimated budget for the 2-month campaign is Rs. 22.68 crores.
Mercedes-Benz IMC Marketing Campaign by Miles MinnaarMilesMinnaar
An IMC Marketing Campaign I created for my introduction to advertising class I took in 2020. Special thanks to Barry Smith, my professor, for teaching me.
This document summarizes a marketing case study presentation by Group 3 on BMW's "Company of Ideas" campaign that targeted the "creative class". The campaign aimed to expand beyond BMW's traditional "yuppie" customer segment by targeting young urban professionals working in creative fields. The presentation analyzes whether the campaign was necessary given BMW's performance in 2005 and discusses criticism that BMW lost its soul by shifting its target market. It also provides a SWOT analysis of the campaign and lessons learned around segmentation and targeting.
Lamborghini is analyzing luxury electric vehicle brands' communication strategies to inform their own plans. This document discusses Tesla's narrative and objectives, compares its advertising to BMW's, and proposes a start-up marketing strategy for Tesla emphasizing storytelling, social media, and grassroots events to build its brand identity and engage customers around reducing carbon emissions.
A brand is forever! A framework to revitalizing the declining and dead brandSameer Mathur
Managerial actions, environmental factors, and competitive actions can all contribute to brand decline over time. However, some brands are able to be revived through strategic revitalization efforts. There are three key steps to reviving a declining brand: 1) assessing whether the brand is still worth investing in based on residual value and equity; 2) developing a long-term strategy to reposition the brand, invest in improving its image, and educate the market; and 3) correcting any past mismanagement issues by improving quality, refining the target market, and resisting urges to lower prices. With the proper diagnosis and execution of a revitalization plan, declining brands can potentially be strengthened and revived.
The marketing plan summarizes BMW's M3 sports car. It discusses the company background, product description, target market, pricing, placement, and promotional strategies. The M3 is a high-performance luxury sports car with over 400 horsepower. BMW targets wealthy individuals seeking a fun and prestigious vehicle. They employ an indirect distribution model and promote through advertising, websites, and sponsoring racing teams to build the brand.
The document summarizes BMW's "HyoRee's Anystar Campaign" marketing campaign from 2001. The goals of the campaign were to sustain growth, attract young customers without alienating existing customers, and strengthen BMW's luxury brand image. The campaign was successful, achieving a 13% sales increase in 2001 and strengthening BMW's brand perception among younger demographics. The document evaluates the success of the campaign and recommends continuing the campaign approach through producing additional short films for distribution online and through DVD, as this leverages the prior success while being cost-effective.
This document discusses characteristics of successful global brands. It identifies vision, invention, and dynamism as key traits of brands that are growing in worth. Vision involves embodying a clear direction and point of view. Invention requires continuous innovation and new experiences. Dynamism generates popular culture through marketing events. Additional characteristics discussed include balancing global and local aspects, having a universal idea rooted in brand truth, and creating a community through shared experiences.
This in-depth brand report summarizes BMW's luxury SUV brand performance in the UK for July 2014. The report includes sections on insights and recommendations, CEO dashboard metrics, spike analysis of key metrics, analysis of Facebook and Twitter pages, audience demographics, and competitors. Key findings include that 26.7% of BMW SUV conversations occur on forums where people ask questions; BMW leads in share of voice but could be more active socially; and there is some online criticism of minor vehicle faults that goes unanswered. The report provides recommendations such as actively engaging on forums, providing technical support online, and monitoring spikes in sentiment around new vehicles.
The document analyzes Jaguar's strategy in introducing its new X-Type vehicle into the low-price luxury vehicle segment. Jaguar hopes to capture younger customers and increase loyalty through this strategy, as well as increase revenues and margins through aggressive growth. However, Jaguar has faced some problems with poor reviews of quality, producing more vehicles than demanded, and aggressive pricing hurting its brand image. The document recommends Jaguar maintain autonomy, improve production quality to attract customers and leave a good impression, and pursue growth in line with demand to limit discounting. If these measures are enacted, Jaguar will be successful growing sales, attracting new customers, and maintaining its brand image.
Lexus is the luxury vehicle division of Toyota Motor Corporation. It employs a differentiation and low-cost strategy to compete in the luxury vehicle market. While Lexus has strong brand recognition and global presence, its production is concentrated in Japan, resulting in high shipping costs. Opportunities for Lexus include growing demand for hybrid vehicles and emerging markets in China and India. However, threats include rising fuel costs, stiff competition, and the impact of Toyota's recent recalls.
The Hyundai Genesis targets baby boomers and high tech professionals with its class-leading performance and fuel efficiency at a lower price point than competitors like the Lexus and Infinity. Intense competition in the luxury sedan market applies pricing pressure as automakers use incentives to attract customers. However, Hyundai has gained market share through high quality, safety, and value. The emergence of foreign automakers like Hyundai also increases competition, while high gas prices could threaten large vehicle sales if customers seek alternatives.
- The Mercedes A-class was launched in 1997 as a compact car to expand Mercedes' product portfolio and attract younger customers. It targeted professionals and couples with a small family income.
- While it faced competition from BMW and Audi in the premium compact segment, its positioning under the Mercedes brand helped establish its luxury credentials. However, it was initially not marketed in the US and Asia due to cultural preferences.
- The A-class suffered a major setback when motoring journalists published that it failed a key safety test, but Mercedes redesigned the chassis to address the issues and regain customer trust in the brand.
Yesterdays Luxuries are Today’s Necessities-A Review on Luxury cars.IOSRJBM
This review article made an attempt to throw light on the luxury cars which has become today’s necessity and one of the important parameter in human life. The reviews made by the researchers before globalization and after globalization, have observed changes in this review paper.
PAGE 2Running Head Honda Motor Corporation Target Market a.docxalfred4lewis58146
PAGE
2
Running Head: Honda Motor Corporation Target Market and Segmentation
Honda Motor Corporation Target Market and Segmentation
Davenport University
Eric Christopher Tingson Garcia
BUSN 520
April 05, 2015
Contents
Overview…………………………………………………........……………………………….….3
Primary Target Market.............………………………………………...…………………..….…..4
Secondary Target Market………….…………………………………………………………..…..6
Target Group....................................................................................................................................7
Market Position…………………………...............................................................................….…8
Conclusion…………………………………………………………...………………...…...…..…9
References……………………………………………………………...………………………...10
Appendix……………………………………………………………...……...…………………..11
Overview
Honda Motors Company being the third largest automaker in Japan is perhaps known best as an automaker giant in the industry. Although the company has had its roots in motorcycles, and is even currently the world’s top motorcycle manufacturer, Honda’s automobile product line still accounts for approximately 90 percents of its sales, especially in the United States where the majority of its sales are generated. Honda has manufactured and sold many top-sellers, such as Accord, Civic, Prelude as well as its luxury line within Acura. Such popularity having positive effect on the success of the company has also generated negative publicity, with the Civic having rank first in the United States’ list of most stolen, and thus “in demand”, vehicles. Other products within the Honda’s vast divisions include other times that bolster annual sale, such as agricultural and industrial use machinery, generators, engines, and all terrain vehicles (Minami & Minato, 2009).
Within every business or even every product, requires the need to have a target market. The target market is the group of customers conceived toward which marketing, promoting and, advertising efforts are broadly aimed. As such, it is essential to direct products at a specific market in order to determine proper price points, as well as distribution channels to which promotion strategies of the company is applied. Determining target markets encompass researching consumers in all various aspect, including but not limited to, characteristics of the group, such as age and gender, as well as social issues, religion, socioeconomic background and spending power. Honda Motor Company is well known for its use of geodemographic segmentation, where they utilize the “combination of geographic, demographic, and lifestyle characteristics to classify consumers” (Bateman & Snell, 2013). Honda utilizes marketing strategies that attract specific market and a multitude of related marketing mix. Having full grasp and understanding about its market demands, Honda is able to attain huge amounts of profits by identifying the characteristics of its target market, and a segment strategy which takes account o.
BMW has achieved great success with its X5 model. Some key factors that contributed to this success include:
- Strong branding of BMW as a luxury brand focused on driving experience and quality.
- Targeting of upper-income consumer segments through features, pricing, and marketing of the X5 as a luxury SUV.
- Effective use of the marketing mix, including competitive pricing, continual improvements to features, and large promotional campaigns.
BMW's analysis of consumer behavior and adaptation of its strategies helped the X5 become the best-selling vehicle in its class.
ECO 5625Factors.docFACTORS AFFECTING RIVALRY AMONG EXISTING C.docxSALU18
ECO 562/5Factors.doc
FACTORS AFFECTING RIVALRY AMONG EXISTING COMPETITORS
To what extent does pricing rivalry or nonprice competition (e.g., advertising) erode the profitability of a typical firm in this industry?
Characterization (Current)
Future trend
Degree of seller concentration?
Rate of industry growth?
Significant cost differences among firms?
Excess capacity?
Cost structure of firms: sensitivity of costs to capacity utilization?
Degree of product differentiation among sellers? Brand loyalty to existing sellers? Cross-price elasticities of demand among competitors in industry?
Buyers' costs of switching from one competitor to another?
Are prices and terms of sales transactions observable?
Can firms adjust prices quickly?
Large and/or infrequent sales orders?
Use of "facilitation practices" (price leadership, advance announcement of price changes)?
History of "cooperative" pricing?
Strength of exit barriers?
FACTORS AFFECTING THE THREAT OF ENTRY
To what extent does the threat or incidence of entry work to erode the profitability of a typical firm in this industry?
Characterization (Current)
Future trend
Significant economies of scale?
Importance of reputation or established brand loyalties in purchase decision?
Entrants' access to distribution channels?
Entrants' access to raw materials?
Entrants' access to technology/know-how?
Entrants' access to favorable locations?
Experience-based advantages of incumbents?
"Network externalities": demand-side advantages to incumbents from large installed base?
Government protection of incumbents?
Perceptions of entrants about expected retaliation of incumbents/reputations of incumbents for "toughness"?
FACTORS AFFECTING OR REFLECTING PRESSURE FROM SUBSTITUTE PRODUCTS AND SUPPORT FROM COMPLEMENTS
To what extent does competition from substitute products outside the industry erode the profitability of a typical firm in the industry?
Characterization (Current)
Future trend
Availability of close substitutes?
Price-value characteristics of substitutes?
Price elasticity of industry demand?
Availability of close complements
Price-value characteristics of complements?
FACTORS AFFECTING OR REFLECTING POWER OF INPUT SUPPLIERS
To what extent do individual suppliers have the ability to negotiate high input prices with typical firms in this industry? To what extent do input prices deviate from those that would prevail in a perfectly competitive input market in which input suppliers act as price takers?
Characterization (Current)
Future trend
Is supplier industry more concentrated than industry it sells to?
Do firms in industry purchase relatively small volumes relative to other customers of supplier? Is typical firm's purchase volume small relative to sales of typical supplier?
Few substitutes for suppliers' input?
Do firms in industry make relationship-specific investments to support transactions with specific suppliers?
Do suppliers pose ...
This is a presentation that was created by myself and several group members for our International Business Capstone class for the Spring of 2009. This was our final presentation in which was graded at a 94%. This outlines our results and findings using business analysis and tatctics to draw conclusions and make recommendations for Lexus' business strategy in Germany.
Campaign: smartUSA - "Leave an Impression"claytonroot
This document provides a marketing analysis and campaign plan for the smart USA microcar brand. It includes a company profile, product overview, target market details, competitive analysis, research findings, and proposed marketing strategies. The campaign aims to reposition smart cars as customizable and trendy vehicles that allow owners to express their individuality. Advertising will focus on interchangeable body panels and feature intellectually dense headlines to portray smart cars as a blank canvas for personalization. The goal is to overcome negative perceptions of the brand and raise awareness of customization options to appeal to younger, urban consumers.
114Building a BrandThe Saturn StoryDavid A. Aaker.docxmoggdede
114
Building a Brand:
The Saturn Story
David A. Aaker
O n January 7 of 1985, Saturn Corporation was announced by GeneralMotors' Chairman Roger Smith, who called it "the key to GM'slong-term competitiveness, survival, and success as a domestic pro-
ducer."' Its mission, in part, was to market compact vehicles "developed
and manufactured in the U.S. that are world leaders in quality, cost, and
customer satisfaction."^ Saturn was not only an ambitious undertaking for
General Motors, but a critical one in light of the major inroads that imports
had made, especially in compact vehicles. The import competitors, who
had relentlessly increased their quality over time, represented a significant
challenge to General Motors. The Saturn project was pursued at a time
when many felt that U.S. manufacturers had no chance to make world-class
compact cars and GM had itself aborted several efforts to do so.
After two years on the market, the initial results of the Saturn project are
in. Saturn has built from scratch one of the strongest brands in the U.S.,
suggesting comparisons with the Ford Mustang of the 1960s, the Ford Pinto
of the 1970s, and the Ford Taurus of the 1980s. However, building a brand
may not be as difficult as maintaining its momentum tactically and man-
aging it strategically. In Saturn's case, success creates its own problems
and options.
Saturn: A Strong Brand?
There are no generally accepted measures of brand equity. However, several
brand equity conceptualizations do have measurement implications. One is
that a strong brand should demonstrate market leadership as measured by
sales or market share. Two leading brand equity researchers, Jean-Noel
Kaupferer in Europe and Larry Light in New York, both use market leader-
ship as a basis of a brand strength definition.^ The editors of Brandweek
Building a Brand: The Saturn Story 115
support this perspective by using sales as the measure of brand strength in
their annual SuperBrands analysis.
In terms of sales, it can be argued that Saturn achieved a leadership posi-
tion. Saturn sold 196,126 cars during its second year, 1992, which made it
the tenth highest selling brand out of some 200 plus brand names—the
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1. Consumer Behaviour of Luxury Automobiles:
A Comparative Study between Thai and UK Customers’ Perceptions
JAKRAPAN ANURIT
KARIN NEWMAN
BAL CHANSARKAR
Total worldwide sales of premium luxury and entry luxury saloons and sports cars are of the order of
1.5 million units a year (Scheele, 1995: 190). The major luxury markets today are the USA,
Germany, UK and Japan. The £21.1 billion UK new car market competes with France and Italy, to
be the second biggest in Europe behind Germany (Harbour, 1997: 7,22). The new registration of
luxury marques’ cars in 1997 in UK alone was 154,506 units (MAVEL, 1997: 59). In other markets,
especially in South East Asia there are, of course, significant sales of luxury cars. However, these are
limited to total volume either by the overall industry size or by local market conditions and
preferences. Accordingly, the luxury car market overall is currently undertaking a social change with
luxury brands seeming less remote, less different, and less exclusive with the quality of life
improving. As a result, increasing competition between makes has intensified the importance of
brand identity. As product standards continue to rise, the perceived image of a car make plays a key
role in the buying decision. The premium marques such as BMW, Lexus, and Mercedes-Benz must
develop attributes and values that reflect changing social values which influence buyers emotionally,
in order to maintain their positions in different regions of the global market.
RESEARCH INTO LUXURY AUTOMOBILES
In the last seven years the research into customer perception and behaviour in the automobile has
been driven by American researchers (Haubl, 1996; Iacobucci, et al. 1996; McCarthy et al., 1992;
Purohit, 1992; Sullivan, 1998; Rosecky and King, 1996). Very few authors and writings have
investigated customer perceptions of luxury cars (Rosecky and King, 1996) and much of this work is
2. focused on consumer loyalty and brand switching ((Iacobucci, et al. 1996; Lapersonne et al., 1995;
McCarthy et al., 1992; Purohit, 1992). The major research focus has been on low priced segment car
ranges rather than the luxury segment in which choice between brand concept image and individual
choice of potential buyers play a great role. Therefore, they have neglected customers’ individual
differences (especially ‘attitudes’ and ‘specificity’) that provide different perceptions towards the
automobiles or their marquees, which are important in purchase decision making (Jahoda, 1966;
Festinger, 1964; Rosecky and King, 1996; Markin, 1969). These research carry the beliefs that
automobiles’ customers ‘merely’ strive for ‘product-related attributes’ (Keller, 1993), in other
words, ‘functional, tangible, visible characteristics’ (Kapferer,1997), or ‘utilitarian needs’ (Havlena
and Holbrook, 1986; McClelland, 1951). This agrees in line with Lancaster’s theory (1966) that
demanders buy groups of features rather than products, their opinions regarding the similarity of
products must also be determined by features. Research into purchasing patterns, however, indicates
that it is not the objective features (tangible or technical attributes) themselves, but rather the
subjective perception of these that determines consumer choice (Bauer and Herrmann, 1995;
McFadden, 1986; Urban and Hauser; 1980).
There are differences between business-to-business (fleet) buyers and retail (non-fleet or private)
car buyers. Business-to-business buyers are professionals and experts in terms of ‘functional benefits’
(Keller, 1993) of cars bought for employees. Thus, their consumption is ‘routine’ and ‘functional’.
This may explain why Table 1 shows that significantly more Lexus GS300 are purchased as fleet cars
(company cars) than BMW 728i from 1994 to 1997. While 728i and GS300 have equal insurance
cost, GS300’s price is lower and it possesses more powerful technical features: a larger engine,
higher horse power, quicker acceleration, and higher maximum speed (JATO Carspecs1), and
therefore is perceived to offer better value for money in the workplace. In contrast, preferences of
retail customers for BMW 728i exceed Lexus GS300’s and enable 728i to achieve higher sales in
total from 1993 to 1997, despite the better offer and technical characteristics of GS300. This is
3. because retail customers are amateur purchasers who spend their own money for non-routine
consumption. Thus, they seek to gain ‘experiential’ or ‘symbolic’ (Keller, 1993) benefits from the
car brand instead. This demonstrates that there exist differences in specificity among individual
customers.
Specificity may depend largely on how buyers discriminate, between ‘essential’ and ‘special need’
(Oliver, 1997: 54) in importance: in other words needs and wants. If some buyers regard importance
as meaning essential, then all requisite features of the cars, such as maximum speed, acceleration
rate, horse power, and engine size become very important. On the other hand, if buyers perceive
importance as a special need, then some features may not be anticipated. For example, if the luxury
car buyer is only interested in the country-of-origin of the brand (German in this case), then the
technical characteristics will be unimportant. When customers seek to purchase a product, they pay
attention to whether the product will satisfy basic needs and desires in their lives. Here, the fleet-car
customers have the basic needs (to choose a cost-effective car), and desires (to possess a luxury car).
The most reasonable choice is Lexus GS300 SE. However, most retail customers have a more
preferable attitude towards BMW 728i. When having to select among alternatives, customers are
interested in differences across brands in the same product segment and even models.
Most luxury cars hold their marques as a flagship. In other words, the brand’s power acts as a
significant entry barrier. To enhance the brand’s power, most luxury car marques have stretched
their brand upward or downward into a ‘new’ segment. Most marques who usually have strong
position of their car models on mid-size and large luxury saloon segments will stretch their brand
downward. For example, Mercedes-Benz introduces A-Class, a small family car, and M-Class, a
sport utility vehicle following the successful S-Class and E-Class introduction. Rover constantly
emphasize their Rover Mini along with their mid-size 800 range. On the other hand, car
manufacturers who are not usually perceived to be in the luxury segment will attempt to stretch their
4. brand upward. The strategy is the diversification into a sub-brand. The most notable examples are
the introductions of Lexus under Toyota and Infiniti under Nissan which have been successful
globally, especially in the US. At this point, the essential features become unimportant because all
brands are perceived to have these features to equivalent degrees. This phenomena insists that
signifying product-related attributes alone can only partially explain the sophistication of buying
behaviour of luxury automobiles’ customers.
CONSUMER BEHAVIOUR OF LUXURY AUTOMOBILES’ CUSTOMERS
Most current owners of luxury cars tend to have purchased a car previously, the customer has
potentially developed an attitude toward it. Here, an attitude becomes an evaluating judgement
(desire or not desire) based on prior or present experience such as previous satisfaction from dealers
or products and services (after sales and warranty), driving experience, and socio-economic status of
customers. It is also possible that an attitude can be developed based on prior information without
experience, as when consumers develop preferences or biases for or against brands based on the
brands’ images in the marketplace. This also depends largely on purchasing power of individual
customers. Customers may have a favourable attitude towards some manufacturers’ luxury cars, but
may lack the ability due to insufficient purchasing power or willingness to take buying action. On
the other hand, luxury or lower luxury (lower-priced) manufacturers’ cars may be neglected by
customers who have high purchasing power (or over-purchasing power in this sense). For example,
most buyers (with high, medium, or low income) tend to have a preferable attitude towards some
manufacturers’ luxury cars such as Aston Martin, Bentley, Ferrari, Porsche, and Rolls-Royce, though
the majority of them might not even have had a test drive before. The difference is that customers
with low to medium income may still also anticipate the quality of smaller sized cars of
manufacturers from the lower segments such as Fiat, Ford, Peugeot, and Vauxhall, as these cars are
affordable to them. In other words, cars from lower segments have the meaning of ‘reality’ to them.
In contrast, the better-off buyers will only appreciate expensive cars from luxury marques and may
5. disregard inexpensive cars from any marques (even from a luxury one e.g., the least expensive Audi
A3 or BMW 3 Series Compact) as their choices. Accordingly, if one is interested in predicting buyer
behaviour of luxury automobiles, an assessment of potential buyer attitude towards the car is needed.
To further specify the definition of customer attitude towards luxury cars, a set of attitude
variables which potential buyers of luxury cars might hold was developed in discussion with luxury
car dealers (Audi, Jaguar, Mercedes, Lexus, and Volvo) at the London Motor Show ’97 at Earl’s
Court Exhibition. The following variables were identified: (1) reliability (2) quality (3) durability (4)
safety (5) security (6) performance (7) efficiency (8) technology (9) handling (10) value (11) style
(12) comfort (13) prestige (14) status, and (15) visual impact. The first nine variables are in the
‘objective’ category. The last six variables are in the ‘subjective’ category.
These different attitudes are directly related to different types of customers because cognition,
feelings, and ‘response dispositions’ of customers are organized into a set of ‘patterned emotional
reactions’ (Markin, 1969). This may be due to differences described as demographic, geographic,
psychographic, or lifestyle. Therefore, behaviour moves from personal buyer to different buyers in a
given society. Like other products, luxury automobile marketers (manufacturers, companies, dealers)
also need to focus on ‘who buys’ or ‘type of customers’ to segment their cars. A discussion of the
segmentation of the consumers and the luxury automobiles follows.
HOW CAN LUXURY AUTOMOBILES’ CUSTOMERS BE SEGMENTED?
Extensive literature on personality in psychology and other behavioural sciences has persuaded
marketing researchers to theorize that personality characteristics should predict brand or store
preference and other types of buyer activity (Engel et al., 1995: 437). Evans (cited in Engel et al.,
1995: 437) was an early researcher who attempted to predict automobile brand ownership. He
undertook this study using 12 objective variables, such as age of car, income, and other
demographics, to test the assumption that ‘automobile buyers differ in personality structure’.
6. Although Evans was able to predict correctly a Ford or Chevrolet owner in 70 percent of the cases, he
concluded that, ‘personality is of relatively little value in predicting automobile brand ownership’.
Several other studies confirmed the lack of relationship between personality and product choice
(Alpert, 1972; Kassarjian, 1971; Ziegler, 1987). Engel et al. (1995) explain that this is due to the fact
that personality is “but” one variable in the process of consumer decision making. Even if personality
traits were found to be valid predictors, they might not assist market segmentation.
Marketers need to respect the fact that people and society can change over time. In the early
1980s, consumer consumption is somewhat ‘conspicuous’. Many firms ignored consumer input or
publicly confront consumer group (Evans and Berman, 1987). Consumers were not very
knowledgeable about a number of products, especially industrial products such as automobiles of
which many brands had not yet become a flagship marque. Thus, they did not know what they
expected from the products. In automobile industry, under the jurisdiction of the National Highway
Traffic Safety Administration of the US, had a number of motor vehicles recalled. For example:
‘250,000 1978-1986 Audi 5000s-after shifting gears, sudden acceleration could occur’. (Evans and
Berman, 1987: 485).
In the 1990s, it is the era of ‘value driven’ customers and suppliers. The consumption can no
longer be conspicuous. Consumers are exposed to more mass media. Commercial media become
sources of useful information on the ever increasing number of products and brands. Personal
sources of information diminish in importance. In addition, traditional consumers become more
experienced and their ability to distinguish between brands is sharpened. Marketers today need to
understand that ‘customer satisfaction is about ‘attitude’; and customer value is about ‘behavior’’
(Butz and Goodstein, 1996: 64). According to this, VALS2 has been introduced and also revised
(referred to as VALS II). This typology then is a sound pursuit of the consumer behaviour approach
suggested by Engel et al. (1990, 1995) as discussed in previous section.
7. VALS typology and luxury automobile customers
VALS typology is divided into four major categories: ‘Need-Driven, Outer-Directed, Inner-Directed,
and Integrated’. Included in these four categories is a total of nine lifestyles: ‘Survivors, Sustainers,
Belongers, Emulators, Achievers, I-am-me, Experiential, and Societally-Conscious’ (Capelli, 1984;
Engel, 1995). As expected, VALS data show that in US: ‘(1) the need-driven (11% of the
population), purchase used cars; (2) the societally-conscience (11% of the population), under Inner-
Directed category, purchase more gas savers; (3) Belongers (39% of the population), under the Outer-
Directed category, tend toward ‘family-sized’ cars; (4) Achievers (a lifestyle which constitutes 20%
of the population), under the Outer-Directed category, buy more large and luxury cars’ (Capelli,
1984: 45).
This data ends support views to an understanding of automobiles’ consumer segments. For
example, need-driven customers are likely not to purchase brand-new and highly-consumption cars.
It also allows marketers to communicate more effectively with core customers and lead to efforts to
position new luxury cars in a lifestyle segments, than if the segment were described only by
demographics. However, when referring to the term luxury car, there is still some confusion over the
concepts of luxury cars and luxury car brands.
HOW CAN LUXURY AUTOMOBILES BE SEGMENTED?
Brand as luxury automobile segmentation
Goodyear (1996) suggests in the second stage (brand as reference) of her evolution of brand concepts
and images3 that the marketers need the identification and differentiation of their products to reflect
the consumer’s goal of making a good selection from among competing brands. Since there exist
differences in attitudes and specificity, what is a luxury car to some groups may be ‘ordinary’ to
others. Segmenting the luxury cars into physical categories regardless of ‘brand association
(attributes, benefits, attitudes)’ (Keller, 1993) can be very difficult to refer to in luxury sense. This
8. requires marketers to identify brands to distinguish between them (Hoyer and Brown, 1990). While
many brands seem to be qualified as luxury brands (e.g., Audi, Bentley, BMW, Jaguar, Lexus,
Mercedes, Porsche, Rolls-Royce) by one third of industrial opinion, only some major brands (e.g.,
Audi, BMW, Mercedes, Rolls-Royce) are considered luxury brands by the public majority. The
luxury cars need to be part of its owner’ life. In other words, it needs to provide its owner the
‘practicability’ both in functional and perceptual point of view. That is why BMW and Mercedes-
Benz have dominated the luxury markets globally. Everything is made to facilitate the user’s and
also highlight the owner’s sense of prestige and status wherever it travels. The frequent use of the
cars will stimulate the perception of a luxury life the owners gain from their possession. In this
respect, Ferrari and Porsche may not be regarded as a luxury car since it is likely not to be driven on
most of the working days, but regarded as a prestigious sport brands. Does this mean a luxury car is
only an expensive saloon?
Automobile’s price and characteristics as luxury automobile segmentation
The Society of Motor Manufacturers and Traders Limited (SMMT) classifies cars into nine
segments: mini, supermini, lower medium, upper medium, executive, luxury saloon, specialist sports,
dual purpose, and multi purpose vehicle (MPV). Amongst these, one can notice that there is the
separate segment namely ‘luxury saloon’. However, this may not describe the whole aspects of
luxury cars. Most luxury automobile manufacturers do not only produce saloons, but also dual
purpose (touring or estate cars), MPV, and specialist sports in terms of passenger cars. In other
words, a luxury car brand is a ‘multi-segment’ (Kapferer, 1995) brand that wants to cover all
customer market segments. For example, BMW positions its products on various segments: lower
medium (3 Series compact), upper medium (3 Series), executive (5 Series), dual purpose (5 Series
touring), luxury saloon (7 Series), and specialist sports (8 Series) range. Thus, a luxury car may refer
to an upper medium, executive, dual purpose, luxury saloon, or specialist sport car. These types of
cars are the cars the owners may drive to the forecourt at a gala dinner and still highlight the owner’s
9. sense of prestige and status. In this respect, a luxury car is ‘not’ limited to the ‘luxury saloon’
segment identified by SMMT. However, luxury cars may ‘not’ encompass ‘all’ passenger cars which
are produced by prestigious luxury manufacturers.
For example, taking cars from the bottom range of a luxury car manufacturer, BMW 3 Series
Compact. Its price starts from £14,670 in the UK. At this price, buyers may purchase cars from
other manufacturers such as Ford Mondeo, Fiat Bravo/Brava, and Volkswagen Golf, which provides
bigger space and better handling. In fact, BMW 3 Series Compact was only the fifth seller in 1997
from the bottom amongst the main sixteen marketers in UK4. In this respect, such prestigious luxury
marque as BMW is not effective in this segment because the standard specifications of the cars in the
lower segments (upper medium, lower medium, and lower) tend to include equivalent features5. This
has directed the study to examine the upper prices and discover that cars with price from £34,001 and
over, also include special equipment such as high-tech service/maintenance and multi-function
information systems, safety, and security (e.g., immobilizers). However, cars with price starting from
£65,000 may not be perceived as luxury cars in general but rather as prestigious specialist luxury or
specialist sports6. This may be explained by the fact that the demands for these cars are very minimal
because of their high price range (GB£65,000-£634,500). This price range is unaffordable to the
majority of luxury car buyers, and therefore does not enter the practicable meaning of luxury cars (as
discussed above).
THAI AND UK CUSTOMERS’ PERCEPTIONS OF LUXURY AUTOMOBILES
What directs the market performances?
For the purpose of a comparative study between Thai and UK luxury automobiles’ customer
perceptions, comparable demands and supplies need to be drawn. Amongst the new registrations of
cars in Thailand and the UK between 1995-1997, their sales performances show that Germany is the
main country-of-origin. This accounts for the fact that a large number of German models are
10. imported in Thailand and UK with a view of the luxury car markets. Audi, BMW, and Mercedes are
the top luxury marques in both countries (see Figure 1a-1b). Mercedes cars are more expensive than
BMW cars in every segment in both countries, yet BMW is more popular in the UK, while Mercedes
is traditionally more popular in Thailand7. From an economic point of view, should not better-off
customers in one of the richer UK be willing to buy Mercedes rather than customers in a poorer
country like Thailand? The outperformance of Mercedes in a smaller and poorer market such as
Thailand may be the result of cultural differences such as ‘susceptibility to social influence’ (Engel el
al., 1995).
This type of phenomena is not new. Most published studies on country-of-origin discover that
country stereotypes have some impact on product evaluations and purchase decisions (Haubl, 1996,
p76). They are found to be influential to specific brands (Chao, 1993; Han and Terpstra, 1988; Tse
and Gorn, 1993; Witt and Rao, 1992), to automobiles (Hankinson, 1989; Haubl, 1996; Newman et
al., 1995), and to luxury automobiles (Rosecky and King, 1996). Accordingly, customers can place
different significance to particular brand images and identities. This then leads to differences in
customers’ individual differences (specificity, attitude), the decision process (the purchase decision),
and service marketing strategy (7 Ps). In this context, emotional elements begin to play a major role
in branding. Customers in both countries need to choose among brands, all of which provide
functional excellence. Although technology has become a prerequisite in the markets; cultural
differences such as social values could explain the luxury car sales positions and customers’ different
attitudes towards BMW and Mercedes differently. This may be explained by Keller (1993)
conceptualization of brand knowledge which has two components: brand awareness and brand
image. The first component of brand knowledge is types of brand associations which consists of
attributes [non-product-related including: price, packaging, user imagery, usage imagery; product-
related], benefits [functional, experience, symbolic], and attitudes. The other two components are
favourability of brand associations and uniqueness of brand associations.
11. How important are the luxury automobiles’ characteristics?
Since the first nine attitude variables (objective) are considered quantitative attributes, they can be
assessed by comparing the standard specifications of BMW and Mercedes in terms of: economy
(consumption: urban, country, combination), engine (capacity size, kW, horse power), performance
(maximum speed, acceleration rate), security, safety, dimensions (interior and exterior), exterior,
driver functions, and comfort (as equipment), provided by JATO CarNotes. Price, a non-related
attribute, which may represent ‘value’ is also included. This reveals that, in both Thailand and UK,
BMW cars offer lower prices, while having more powerful engine (e.g., more horse and toque power)
leading to better performance (higher maximum speed and quicker acceleration rate) and efficiency
(lower fuel consumption) than Mercedes in all segments (comparable ranges). Yet such functional
characteristics has not enabled BMW to outperform Mercedes in Thailand. In other words,
functional benefits may not be used as a strong brand association to persuade the luxury car
customers to have preferable attitudes towards BMW brand image. The reason may be that BMW
does not provide the favourability of brand associations in terms of user imagery, usage imagery, and
symbolic benefits which are the most important requisite for the majority of luxury car customers in
Thailand.
Referring to the 15 attitude variables identified in a pilot study of dealers at London Motor Show
in 1997, Thai customers seek to obtain the attributes in symbolic sense. Whereas prestige and status
are the strength of brand association, some of the rest of the variables may be almost neglected by the
customers. For example, performance and handling are almost not necessary for the Thai customers
(especially in Bangkok where the majority of luxury car customers in Thailand live), due to the
‘environment influences’ (Engel et al., 1995). Thailand has some of the world’s most congested road
networks in and around Bangkok , which accounts for over 10% of the country’s population and is
one of the most densely crowded cities in the world. Therefore, Thai customers have a lack of
12. (frequent) experiential benefits of the performance and handling of BMW, even if they are proved to
be superior (JATO CarSpecs). Such brand values of BMW as ‘quality, technology, exclusivity, and
performance’ may not be considered as an important brand identity for the customers. At this point,
BMW and Mercedes’ functional benefits (reliability, quality, durability, safety, security, comfort) are
equivalent. Consequently, Thai customers pursue to acquire user imagery and usage imagery to gain
symbolic benefits.
How important are the social influences?
‘Imagery is a process by which sensory information and experiences from long-term memory are
represented in short-term memory’ (MacInnis and Linda, 1987 cited in Engel et al., 1995: 489). It is
possible that user imagery and usage imagery may be related largely to the social class and status.
The symbolic function of possessions can be explained by ‘social constructionism’ which regards
possessions as ‘socially shared symbols of identity’ (Dittmar, 1992, p68 cited in McEnally and de
Chernatony, 1998: 18). All individuals share in a process of transmitting, reproducing, and
transforming the social meaning of objects. Thus, consumers receive the meaning of objects,
transmitted by others and which they, in turn transmit to others, but they are also transformers of
social meanings. The fact that BMW is the favoured brand in the UK and Mercedes is Thailand
prestigious choice is then not surprising if one recalls the scenery of Thai Royal family, politicians,
and millionaires sitting in Mercedes limousines, and those UK excellencies and billionaires sitting in
Rolls-Royce. Enhancing this values, Mercedes’ advertising always promote Mercedes as a very
expensive, luxury, and prestige car and also reputation for reliability (dependability: in terms of ease
of maintenance and repair cost) and durability (BBC Top Gear, 1998). Customers’ imageries are
then linked to a ‘cognitive elaboration mechanism’ according to which ‘used by’ information and
would increase the general level of interest in the product under consideration (Hong and Wyer Jr.,
1989). They will be regarded as successful persons living a luxury life in the society if they possess
such cars.
13. Nevertheless, there is a small segment of Thai customers who are attracted to BMW in terms of
its sportiness (performance, handling, appearance/visual impact) despite the traffic congestion
indicating a role for attitudes towards brand image and identity. Although the customers have a lack
of frequent opportunities to gain functional and experiential benefits of performance and handling of
BMW cars in Thailand, they can still gain these benefits from technology and sporty appearance of
the cars. This can be explained by psychometrics (Haubl, 1996: 90) which has proved that foreign
(German) production of automobiles is likely to have an impact not only on car buyers’ overall
evaluation of a vehicle, but also on their perception of specific product attributes, e.g., various
technical features or the appearance of the car. UK customers, more fortunate than the Thais, have
higher purchasing power and opportunities (full ranges of products and better infrastructures) to more
fully experience the functional and experiential benefits from BMW. It is possible to merely
metaphorically describe that, at the equivalent degree of enjoyment, ‘UK luxury car customers drive
the cars’ but ‘Thai luxury car customers let the cars drive them’. Thai and UK customers may share
the same degree of willingness to involve in such a stereotype because they represent different types
of customers.
How can VALS explain Thai and UK luxury automobile customers?
Referring to VALS typology, the BMW brand image and personality seem to match two customer
lifestyles: under Inner-Directed category; Experiential and Societally. Whereas Mercedes’ may be
more compatible with Belongers, Emulators, and Achievers under Outer-Directed category.
Apparently, Experiential and Societally, the UK majority, seek direct experience thus make a careful
decision in favour of product-related attributes which could provide them with both functional and
experiential benefits. In this respect, BMW delivers such uniqueness of brand associations
(individualistic needs) and has become the ‘brand as icon’ (Goodyear, 1996) of ‘quality, technology,
exclusivity, and performance’ which self expresses the symbolic properties of ‘luxury’ in UK society.
14. In contrast, the majority in Thailand, Belongers, Emulator, and Achievers are more oriented to
fame and success and to preserve the status quo. Thus, they seek non-product-related attributes
(price, user and usage imagery) to ascribe symbolic benefits in order to display their social position,
prestige, and status in Thai society. Only a radically improved or revolution changed product would
entice such a conservative segment to alter their purchase intention. In this respect, Mercedes
highlights the uniqueness of association in social-material terms and has become the brand as icon of
‘luxury, quality, and status’ which self expresses the symbolic properties of ‘luxury’ in Thai society.
RECOMMENDATION
Further to the evolution of brand concepts and images suggested by Goodyear (1996), BMW and
Mercedes-Benz have both successfully reached the brand as icon stage at the global level. On the
demand side, their customers are now far more knowledgeable and marketing literate. Brands are
now perceived as part of their life, a representative of needs and wants in customer constellation.
Thus, marketers do not intensify their market communication but present only specific
communications. Prestigious luxury brands like BMW and Mercedes do not need to expose
customers to frequent advertisements. In current practise, the necessary occasions take place only
when new models are introduced. Such top luxury car manufacturers are now attempting to level up
their brand with the post-modern approach namely ‘brand as company’ and ‘brand as policy’. At this
stage, marketers are aware of consumer cynicism and cautious about their actions which could affect
customer and public values positively or negatively. For example, BMW’s acquisition of Rover in
1992 and proposal to take over Rolls-Royce in 1998 drew public cynicism (Beavis et al., 1994: 14;
Guardian, 1998: 22; Done, 1994: 23; Marquardt, 1994: 23; Steinmetz and Mitchener, 1998; Wall
Street Journal, 1998: 12). Rover cars are now perceived as of higher quality and BMW have a bigger
umbrella. The merger between Mercedes-Benz and Chrysler in 1998 have created a new utopia in
US. The controversial failure test of Mercedes A-Class in 1997 has not decreased customer demand
for any of their car ranges.
15. On the supply side, BMW and Mercedes need to reconceive their physical products as products
and services (luxury cars, aftersales services and warranty) and reassure their dealers to create,
maintain, and create customer values. While all things being equal, it is the era of the service
industry at which companies can gain a competitive edge by focusing on customer value-building an
actual ‘emotional bond’ with the customers (Butz and Goodstein, 1996: 63). This will lead the
customer to purchase repeatedly, or moreover, to recommend that dealer to friends and family, and to
withstand the marketing effectiveness of other manufacturers. Marketers have to bear in mind that,
over time, customers may have to change their behaviour even though their initial attitude
constellation still remains. Such involuntary changes are compelled by ‘situational influences’
(Engel et al., 1995; Lapersonne et al., 1995). For example, an older customer who used to own an
executive or luxury saloon may now have a family and needs to acquire an estate or sport utility. In
such circumstance, he may or may not purchase those types of cars from his favourite brand. The
customer will potentially shift back to the stage where he perceives brand as reference (as discussed
earlier), giving priority to product-related attributes to acquire functional benefits for his family well-
being and may see no longer needs to take experiential and symbolic benefits from a specific brand
into consideration. For example, Audi may outperform BMW in terms of dual purpose car sales.
Japanese manufacturers such as Nissan and Toyota are demonstrating the growing success of their
sport utility vehicles (off-road cars) over Land Rover. Lexus and Infiniti may steal BMW and
Mercedes (private) customers by this opportunity. All the attitude variables (both quantitative and
perceptual) will be interrelated referred as ‘relational variables’ (Morris and Holman, 1988) and
come into play with service loyalty. The manufacturers need to prevent such backward direction
because it costs time and money to develop and provide offerings that satisfy new and unfamiliar
customer needs, wants, and expectations that ruled by their perceptions (Zeithaml and Bitner, 1996).
Satisfaction will then be a major influence on the customer’s ‘revised’ attitude, which is also
influenced by the prior attitude (Oliver, 1997). This may be achieved by the effective service
16. marketing strategies.
CONCLUSION
The logical extension of this hypothesis is that Mercedes will outsell BMW in countries with the
same socio-economic and cultural profile. These countries may be grouped by the markets where
BMW and Mercedes are best selling their products (see Figure 2).
The implication for marketing managers is that over time as these countries’ economy are
developed, their market positions will change. BMW is proposed to reflect individualistic needs in
terms of functional and experiential benefits of customers in the rich country such as: the UK, USA,
Australia, and Switzerland. These mainly are the rich countries in Europe and America. Potentially,
Mercedes’ luxury car market positions may be weaken or eventually defeated by BMW in the world
car markets such as in Japan, South Africa, and Thailand, if their economies upwardly change and
the societies uphold different values towards luxury.
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NOTES
1. JATO CarNotes and CARSPECS are PC-based systems which allow analysts to access detailed
information about vehicle specifications and the numbers of vehicles sold in various markets,
supplied by JATO Dynamics LTD (GB).
2. VALS/VALS II is ‘a system developed by SRI International for categorizing consumers according to their values and
lifestyles. The VALS typology provides comprehensive segmentation of people into nine specific groups. Each
group is so distinctive in behavioral make-up that it can constitute a specific market segment. By targeting these
groups, the effectiveness of marketing and advertising strategies can be improved’ (Capelli, 1984: p46). This
typology has been used by car marketers in US such as Chrysler, Ford, GM, Honda, Mercedes-Benz, Mitsubishi,
Nissan, Renault, Subaru, Toyota, and Volvo (Engel, 1995).
3. Goodyear (1996) describes the evolution of brand concepts and images in terms of six stages. The
first four stages of this model represent the ‘traditional classic’ marketing approach (namely
unbranded goods, brand as reference, brand as personality, and brand as icon); the last two stages
represent the ‘post-modern’ approach to branding (namely brand as company and brand as policy) (McEnally and de
Chernatony, 1998).
4. From highest to lowest selling performer: Ford, Peugeot, Vauxhall, Volkswagen, Rover, Renault,
Honda, Mazda, Fiat, Citroen, Audi, BMW, Toyota, Nissan, Alfa Romeo, Mitsubishi (BMW GB, 1998).
5. Safety: side-impact bars, airbag (driver/passenger); ABS: Security: deadlocks, central locking,
alarm; Comfort: automatic transmission, power steering, split rear seats, electric windows (front/rear), electric
mirrors, stereo, CD, sunroof and air condition.
6. Cars in these segments are highly expensive saloons top range of well-know marques such as Audi, Bentley, BMW,
Ferrari, Lamborghini, McLaren F1, Mercedes, and Porsche.
7. In fact, Thailand has been the country where Mercedes-Benz has the largest market share outside
Germany (MIRA, 1997: 235).
21. Figure 1a: UK 1993 - 1997 Passenger Car Registrations by Luxury Marquees
Total Industry Sales in 1997 = 2,170,725 Total Industry Sales in 1996 = 2,025,450 Total
Industry Sales in 1995 = 1,945,366
Total Industry Sales in 1994 = 1,910,933 Total Industry Sales in 1993 = 1,778,426
Make 1997 1996 1995 1994 1993 Market Market Market Marke
Share Share Share Share
(%) 1997 (%) 1996 (%) 1995 (%) 19
Audi 35,524 30,327 25,555 22,978 19,725 1.64 1.50 1.31 1.20
BMW 63,734 56,840 55,034 45,574 40,921 2.94 2.81 2.83 2.38
Jaguar 9,507 8,401 8,727 6,659 6,224 0.44 0.41 0.45 0.35
Lexus 25,602 23,267 24,670 22,127 12,060 1.18 1.15 1.27 1.16
Mercedes 42,530 35,813 32,694 29,186 21,186 1.96 1.77 1.68 1.52
Porsche 2,333 1,490 1,139 1,300 1,000 0.11 0.07 0.06 0.07
Rolls-Royce 878 638 493 460 362 0.04 0.03 0.03 0.02
Source: 1.BMW (GB) Limited 2.JATO CarSpecs
22. Table 1 UK Sales Volume of BMW 728 i SE V.S. Lexus GS 300 SE 1993 - 1997
BMW 728 I Lexus G
( 36,945/ 2793cc/ 193 kW 206 HP/ Acceleration 0-60 km/h: 9.6 seconds/ ( 34,095/ 2997cc/ 219 kW 220 HP
maximum speed: 140 mph) maximum sp
Insurance Group/ typical quote: 17/ 502 Insurance Group/ ty
1993 1994 1995 1996 1997 1993 1994 1
Fleet Non- Fleet Non- Fleet Non- Fleet Non- Fleet Non- Fleet Non- Fleet Non- Fleet
Fleet Fleet Fleet Fleet Fleet Fleet Fleet
391 4631 526 2,559 55 11820 2115 6414 5501 14833 185 509 3122 421 5314
5,022 3,085 11,875 8,529 20,334 694 3,543 12
23. Source: 1. JATO Carspecs 2. BUYER S GUIDE, WHAT CAR? (June 1998, p126, 220)
Figure 2: Worldwide BMW and Mercedes-Benz Car Registration 1991-1996/7
120000
100000
80000 Australia
Japan
South Afric
60000 Switzerlan
UK
USA
40000 Thailand
20000
0
BMW BMW BMW BMW BMW BMW BMW
1991 1992 1993 1994 1995 1996 1997