MARKETING ASSIGNMENT | My Assignment Tutor

Page | 1INDIVIDUAL MARKETING ASSIGNMENT – VOLVOExecutive SummaryVolvo is synonymous with safety. As a follower in theluxury car market, Volvo positions itself against itscompetitors using a differentiated strategy; a uniquecombination of superior safety, durability, Scandinavianstyling and performance.(Figure 19)Volvo currently offers three SUVs in its ‘XC’ range, twowagons (‘V’ range) and a sedan (‘S’ range). Prices start at $54990 for its baseline S60Momentum and increase to roughly $92k for its top model XC90 R-Design, a sporty 7 seaterSUV. Globally, SUV sales comprise 63% of total sale (Volvo, 2020.) Volvo captures a smallportion of the market with a mere 0.7% of total new-car sales in Australia in 2019.Volvo’s consideration set is Mercedes-Benz (the market leader), Audi, Lexus and BMW.However, Lexus can be considered their biggest threat. Where its competitors emphasizethe high performance, sex appeal features of their brand, Volvo continues to leverage on itsreputation for safety in all marketing communications. Whilst the language has slightlychanged, from ‘durability, reliability, safety’ to words such as ‘confidence’, the strategylargely remains the same. As consumer trends change, Volvo has now steered its futurestrategy to growth through innovation in environmentally-friendly electric and hybrid models.Table of ContentsIntroduction …………………………………………………………………………………………………………….2Describe the brand & why you like it…………………………………………………………………………….2Why others like it ……………………………………………………………………………………………………3Identify competitor set………………………………………………………………………………………….4MarCommsAudit……………………………………………………………………………………………………………………………… 5PositioningStatement……………………………………………………………………………………………………………………… 9Brandpromise…………………………………………………………………………………………………………………………………10Advertisements……………………………………………………………………………………………………………………………….11Page | 2Media consumptionpatterns…………………………………………………………………………………………………………..14Conclusion………………………………………………………………………………………………………………………………………15Referencing…………………………………………………………………………………………………………………………………… 16IntroductionVolvo: Scandinavian styling, safe, durable. The Swedish carmanufacturer has become synonymous with safety, due to itshistory of innovation; most notably for the development of 3-pointseatbelts and side-impact airbags. (Forbes, 2019.)The following report will discuss Volvo’s positioning in the marketagainst its competitors, namely BMW. To simplify thisdiscussion, this report will focus on Volvo Cars, and its image inWestern markets, namelyAustralia.(Figure 1)PART 1:1. Describe the brand and why you like it?Fun fact: my dad has owned hisP1800 longer than anyone else inAustralia! Simply put, the Volvo brand is a fundamental part of who Iam, and that of my family. I essentially grew up in a Volvo, from the1962 P1800, to the 1972 140, 1978 240,1988 240 wagon and finally learning todrive in my 1992 240 sedan. Fondlynamed ‘Goldy’, the 240 carried methrough my Ls, driving around the NorthernSuburbs with my dad in the passengerseat, bonding over car mechanics and thelike. Then through university, my weeklytrips to Moss Vale and back, Wollongong toSydney daily. I can attest to Volvo’sPage | 3reputation for safety – the heavy rubber bumpers proving useful with minor bumps onmy Ls and Ps; and more impressively, after being gauged by a driver into my driverdoor, my car was left without so much as a scratch! Whilst I love my new Toyota,Volvos have an un-replicable quirk, and a body so strong that keeps them on theroads for decades more than others.Please note photos on this page are my own.Why others like it:Volvo is a Swedish manufacturer of cars, established in 1927. The brand has been built onthe core values of putting safety at the heart of all it does, with uniquely Scandinavianstyling. Volvo is understated, pragmatic and considerate – in a way that reflects the Swedishway of life. Unlike its competitors, Volvo is a luxury car due to the high quality of itsproducts, its functionality and minimalistic styling. Conversely, BMW and BMW can beconsidered ostentatious, with their customers wanting high performance status symbols.Historically, Volvo’s reputation of safety has been a key motivator for purchasers. Thisreputation has been built on continued innovation of safety features, starting with theintroduction of the three-point seatbelt by thebrand in 1958, the first of any in the market.Whilst it patented this technology, it made thepatent available to all manufacturers, free oflicensing fees so as to encourage the widespreadadoption of seatbelts. Volvo was also the firstmanufacturer to introduce side-impact airbags.(Forbes, 2019.) As consumer trends change,Volvo has now steered its future strategy togrowth through innovation in environmentallyfriendly electric and hybrid models (Volvo, 2020.)Volvo currently offers three SUVs in its ‘XC’ range, two wagons (‘V’ range) and a sedan (‘S’range). Prices start at $54990 for its baseline S60 Momentum and increase to roughly $92kfor its top model XC90 R-Design, a sporty 7 seater SUV. As shown in Figure 2, SUV salescomprise 63% of total sales globally (Volvo Cars, 2020), and 97.8% in Australia (GoAuto,2019.)Volvo’s customers like ‘solid things, safety, reliability…possesses traditional, secure values,and attaches more importance to the quality of his environment than to his status’ (Duprat,1988.) As will be discussed further, customers are affluent and style conscious, but primarilyVolvo Sales by Range(Figure 2)14%23%63%XC (SUV) V (Wagon) S (Sedan)Page | 4interested in the safety features of its cars. Volvo’s customers are typically families,purchasing from the 4WD ‘XC’ range.Studies conducted by Nielsen Australia indicate that Australian families are 31% more likelythan those without children to purchase an SUV (Nielsen, 2018). Further, the average of theluxury car buyer in Australia is now aged between 25-39, with people in this group earningon average $1315 a week (ABS, 2018). Volvo sales continue to grow, in line with increasedluxury sales overall, despite worsened economic conditions due to the COVID-19 Pandemic.Interestingly, in China, the perceived safety of a Volvo is not factored into customers’purchasing decisions at all, with perceived social status being a key factor (Nga et al, 2019).However, it can be argued that this focus on safety over styling has allowed its Europeanpeers such as BMW, Mercedes-Benz and BMW to control the market. Realising that Volvowas lacking in brand consideration as a luxury car, Volvo has since modified itscommunications strategy to reflect a ‘cooler’ lifestyle.(2) Identify its competitor set and who is the biggest threat and why? Make sureyouprovide evidence to support your argument e.g., blogs, forums, articles etc.Volvo’s competitor set is market leader Mercedes-Benz, BMW, Audi and Lexus. This isbased on these brands’ current product offering and pricing.According to the Federal Chamber of Automotive Industries, there were 1062867 newvehicle sales in 2019 in Australia. Volvo’s sales of 7779 represent just 0.7%. Although Volvocontinues to be a small player in a highly competitive market, its 2019 growth, fuelled by anincreased marketing budget, positions the company well against BMW, Audi and Lexus(Volvo, 2020.) A comparison of the five brands’ sales is shown in the following compositegraph (VFACTS, 2017-2020). In analysing these results it should be noted once again thatVolvo currently only has six models on the Australian market (with almost all sales achievedby its SUV range), with its competitors offering at least twice that.Page | 5With similar market share in recent years and an understated but luxurious design, Volvo’sbiggest threat in 2020 is Lexus. There have been many favourable comparisons made bycar reviewer’s between Lexus’ SUV, the RX and Volvo’s XC90 – such as by Carsguide,Drive and Business Insider. Volvo’s entire strategy is focused on the customer experience,including in the sales/after sales experience. Lexus appears to be following a similarstrategy, narrowly beating Volvo as #1 in Roy Morgan’s 2019 customer satisfaction survey –at 98% vs. 95% (Roy Morgan, 2019.)(3) MarComms AuditBrand positioning is the process of creating a particular view of the brand in a consumer’smind, so that they will consider, and ultimately purchase the brand (Rossiter et al, 2018.) Asconveyed in the included examples, Volvo employs a differentiated positioning strategy as amanufacturer of safer, more innovative cars, with sleek Swedish styling. Where itscompetitors position themselves as sexy, high performance, luxury cars, Volvo continues tofocus on its minimalistic style and practicality.The following print advertisements highlight Volvo’s ongoing strategy of differentiating itselfsimply as being safer and more durable. Volvo often uses humour in its print advertisements– embracing negative attitudes of the Volvo brand in popular culture – to market its ‘inferiorbenefit’ (its boxy features e.g. rubber bumpers) as key to what makes a Volvo the safest car.Further, the continuity of muted background colours, simple copy, leaving the focus on thecar shows cosmetic integration of Volvo’s campaigns:Sales of Volvo and Competitors 2016-2019 Australia450004000035000300002500020000150001000050000Mercedes-Benz Volvo BMW Audi Lexus2016 2017 2018 2019Page | 6(Figure 3) (Figure 4)Volvo’s positioning strategy differs slightly with social media platforms. On Facebook, Volvoattempts to appeal to favourable brand switchers by positioning the car as understated,innovative and uniquely Swedish. Whilst ‘safety’ isnot explicitly mentioned, Volvo is attempting tocommunicate a slightly ‘cooler’, more luxuriousbrand personality, highlighting the car’s functionalbenefits with more understated copywriting thanbefore.On Instagram, Volvo appealsto its brand loyals, with postsalternating between nostalgicreminders (“throwbacks”) of(Figure 5 to left and 6 toright)iconic models, and advertisements of its new models. In comparison toVolvo’s positioning of its ‘cool’ Swedish styling, Instagram highlights itsretro designs as quirky. However both are examples of an emotionalselling proposition, in that customers can be reassured of their safety,without compromising on the features one would expect in a luxury car.Page | 7(Figure 7)OmtankeThe concept of ‘Ömtanke’, meaning ‘care and consideration’ was introduced to encapsulateVolvo’s continued focus to build safe cars, with its commitment to produce environmentallyfriendly, carbon-neutral cars. As part of this campaign, Volvo produced the above televisionadvertisement to promote its collision avoidance feature.Volvo’s key competitor, BMW also utilises an emotional selling proposition, highlighting thehigh performance features (‘fasterpiece’), with emotive language such as ‘exhilarating’ and inits former tagline, ‘sheer driving pleasure.’Page | 8(Figure 8)Whilst Volvo drivers seek safety, BMW drivers are motivated by the anticipated thrill ofdriving a high performance vehicle. The following chart highlights the two brand’s differingbrand attitudes: Brand deliveryEmotional BenefitVolvoBMWReinforces owner’s feelingof individuality and personalfocus55Driving pleasure610Safety, security107Feeling of having made anintelligent choice97 As per Rossiter et. al – Source: Hypothetical ratings inferred from the case description inBergstrom et al. (2002) (Figure 9) Rossiter et al.When compared with BMW’s most recent tv ad campaign, which highlights the car’s highperformance, Volvo may be considered dull. Whilst BMW’s focus on its performance may beregarded as ostentatious, (not in line with Volvo’s values), research shows that sex appeal iskey in making luxury car purchasing decisions, with 56% stating it is an important factorPage | 9(Nielsen, 2019.) Sex appeal as an extension of one’s self may prove more powerful thanluxurious safety for consumers comparing alternatives in the consideration set.(4) Do a positioning statement for the brand/product using Rossiter et al’s, Rossiterand Percy Grid, T-C-B model, I-D-U models(where appropriate).Using the ‘product as hero’ approach to brand positioning:“For the style-conscious driver and their family, Volvo is the safe choice when it comes topurchasing a luxury car. Volvo embodies the ultimate in Scandinavian style, innovation anddriving confidence.”When considered in regards to ‘brain levels’ theory, Volvo undertakes an emotional sellingapproach to its positioning. Volvo ensures its customers are emotionally motivated topurchase. It does this by creating content highlighting the cars’ key benefit; its safetyfeatures, (and more recently environmentally-friendly features), with a believable message:that Volvo is the safest choice for your family.The T-C-B model: Target – Category – BenefitTargetVolvo’s target customer is broadly families, with the creative target specifically being womenaged 25 to 39. This is because women have been found to influence 80% of car purchasingdecisions (Forbes, 2014). As previously discussed, based upon the sales of Volvo SUVs, itis reasonable to assume that Volvo’s current/potential customers are largely families.CategoryVolvo is in the luxury car category.BenefitAs discussed, Volvo’s key benefit is that it is superior in delivering safety – that their cars aresafest, with significant innovations – e.g. 3 point seatbelts and side impact airbag.Page | 10As brand loyals, some Volvocustomers may have lowinvolvement with their purchasingdecision, however overall, due tothe risk and emotional involvementassociated with purchasing a car –particularly in the luxury market,Volvo can be regarded as atransformational high involvementproduct. This is the group that’stargeted in Volvo’s advertising.products as uniquely safe.Rossiter and Percy Grid(Rossiter et al, 2018.)According to Statista, safety is theleading motivator for customerswhen choosing among alternativecars (2018.) It’s interesting thatwhilst this may be considered an‘entry ticket benefit’ i.e. a functionalbenefit fundamental to the vehicleproduct category, Volvodifferentiates itself by marketing its(5) On the basis of your positioning statement please describe its brand promise toitstarget market.To produce the safest cars on the road, without sacrificing the features consumers expect ina luxury car.Page | 11The all new XC40, the first fullyelectric Volvo… The 390 horsepowerenginePART 2: (Worth 10 marks)1. AdvertisementsThe objectives of the following campaign are:• To lessen negative brand attitudes towards the Volvo brand as being uninspiring, theefficacy of this will be measured by surveying customer attitudes toward the brand,their key motivating factors in purchasing, and their awareness of the campaign.• This attitude change will also be seen by any measurable increase in sales (by adesired 30% in 2021)• Research shows that concern for the environment is growing, as 31% of Australianconsumers. Despite this, there is a lack of understanding about electric vehicles, withonly 16% stating that they feel sufficiently educated (Nielsen, 2019.) To increaseawareness of Volvo’s commitment to electric only vehicles, by achieving pre-ordersales in Australia of 3000 units by January 2021.The following advertisements aim to be more engaging than Volvo’s current campaigns, reinjecting an element of ‘fun’ into the brand’s image, whilst remaining true to Volvo’s corepositioning strategy. Further, whilst Volvo has not historically used paid advertising in theform of brand ambassadors/sponsorships, using a well known Swedish celebrity in Volvo’ssocial media marcomm’s would improve the credibility of Volvo’s new claim to luxury.TV Advertisement1. *up beat, orchestral music plays*(Figure 10)Page | 12And Pilot AssistIt’s a Volvo, but not as you know it…(Figure 11)(Figure 12)(Figure 13)With Intellisafe technologyincluding Oncoming Lane MitigationPage | 13*music fades out*(Figure 14)Social media1.Collaboration with well known Swedish personality – video content on both Volvo andSkarsgard’s accounts. “In an uncertain world, it can be difficult to know who to trust toprotect my family’s future. That’s why I choose Volvo, with more than 60 years of drivinginnovation in safety, it’s now committed to protecting the environment too, with the first fullyelectric XC40, fitted with recycled materials. It’s a Volvo. But not as you know it.”(Figure 15) (Figure 16)Page | 142. Specific to Instagram(Figure 17)Magazine Ad“#TBT to 1959! At Volvo, our top priorityhas always been your safety. That’s why in1959 we developed the 3 point seatbeltand quickly introduced it as standard in allmodels. Because confidence never goesout of style.”(Figure 18)3. Media Consumption Patterns• Research conducted by Neilsen shows that 63% of luxury car buyers considerthemselves to be car enthusiasts, and therefore actively research their options whenlooking to purchase. In starting this process, luxury car buyers often follow brand’ssocial media platforms. It would be reasonable to assume also, that this group of themarket would have a somewhat positive view of Volvo, and therefore by creatingPage | 15engaging digital content, Volvo can engage/sway favourable brand switchers. Part ofthis interest in cars is innovation, and therefore they pay attention to newadvancements in technology. Further, they are 71% more likely than other car buyersto view websites and videos and 40% more likely to view magazine ads. (Neilsen,2019.)• In regards to ensuring young families see the TV advertisement in particular,research shows that most people (38%) view news content on the TV. Volvo wouldtherefore pay for its ad’s to be played between 6 – 6.30, the typical nightly news slot.Further to this, 45% of Deloitte’s respondents stated that they were more likely toengage with ads seen on TV over smartphones. (Deloitte, 2020).• Social media ads will feature on Instagram and Facebook, with most people havingaccounts with either of the two platforms (31% and 81%.)ConclusionVolvo Cars has a strong positioning strategy based on differentiation – of delivering the bestin safety, combined with unique Scandinavian styling and innovation. Despite this, the brandhas negative connotations with being ‘dull’ and ‘boxy’, as compared with its key competitors,such as BMW which is able to capture a large proportion of the market by promoting itsproducts as high performance and sexy. As Volvo continues to enjoy the success of itsXC90 market, it should continue to invest in its marketing communications, namely socialmedia. This will be important in the long term in changing the brand attitudes of youngergenerations, to ensure strong sales in the long term.Page | 16ReferencesABS, 2018. “6306.0 – Employee Earnings and Hours, Australia, May 2018.” [online].Available:https://www.abs.gov.au/ausstats/abs@.nsf/mf/6306.0Armstrong, M, 2018. “Most Important Factors When Buying A Car”, Statista. [online]Available:https://www.statista.com/chart/13075/most-important-factors-when-buying-a-car/Bell, D, 2019. “Volvo’s Gift to the World, Modern Seat Belts Have Saved Millions of Lives”Forbes. [online]. Available:https://www.forbes.com/sites/douglasbell/2019/08/13/60-years-of-seatbelts-volvos-great-giftto-the-world/#4879ba9d22bcBrown et al, 2018. “Australian Families Driving SUV Boom”, Nielsen Australia. [online]Available:https://www.nielsen.com/au/en/insights/article/2018/australian-families-driving-suv-boom/Brown, M, 2019. “Making Buyers’ Hearts Race! Why Luxury Car Brands Should Sell onEmotion” Nielsen Australia. [online]. Available:https://www.nielsen.com/au/en/insights/article/2019/making-buyers-hearts-race/Costello, M, 2017. “2016 VFACTS wrap: New sales record set, winners and losers detailed”Caradvice. [online] Available:https://www.caradvice.com.au/511197/2016-vfacts-wrap-new-sales-record-set-winners-andlosers-detailed/?q=/511197/2016-vfacts-wrap-new-sales-record-set-winners-and-losersdetailed/photos/29577f2f33bfd210723095d1ac2d73f4&&ca_rd=routeCostello, M, 2018. “VFACTS: Industry claims annual record for 2017.” Caradvice. [online].Available:https://www.caradvice.com.au/612213/vfacts-industry-claims-annual-record-for-2017/Costello, M, 2019. “VFACTS: 2018 annual sales wrap”. Caradvice. [online]. Available:https://www.caradvice.com.au/714908/vfacts-2018-annual-sales-wrap/Costello, M, 2020. “Luxury car brands grow sales, as market shrinks”. Caradvice. [online].Available:https://www.caradvice.com.au/833889/luxury-car-brands-grow-sales-as-marketshrinks/#:~:text=Brands%20that%20have%20grown%20by,more%20sales%2C%20up%201.1%20perDeloitte Australia, 2019. “Media Consumer Survey 2019.” [online]. Available:http://images.content.deloitte.com.au/Web/DELOITTEAUSTRALIA/%7B9450afa3-2ec0-498f-8cad-75063ba51d6c%7D_20191011-tel-media-consumer-survey-2019-report.pdf?utm_source=eloqua&utm_medium=email&utm_campaign=20191009-tel-mediaconsumer-survey-2019&utm_content=ctaNewman, J, 2019. “It’s True! Women Really Do Shop More…For Cars” Forbes. [online].Available:https://www.forbes.com/sites/jennifernewman/2019/05/30/its-true-women-really-do-shopmore-for-cars/#586bfece3a0cPage | 17Nga et al, May 2019. “Factors influencing on consumers’ decision to buy Hyundai cars inHanoi.” International Journal of Scientific and Engineering Research. Volume 10, Issue 5.[online] Available:https://www.ijser.org/researchpaper/Factors-influencing-on-consumers’decision-to-buyHyundai-cars-in-Hanoi.pdfRossiter et al, 2018. “Marketing Communications: Objectives, Strategy, Tactics”, SageAustralia.Roy Morgan, 2019. “Lexus approaches near-perfect customer satisfaction” [online].Available:http://www.roymorgan.com/findings/8172-car-manufacturer-satisfaction-august-2019-201910272350Thomas and Holden, 2016. “The Motor Car and Popular Culture in the Twentieth Century”Routledge, New York. [online via Google Books]. Available:https://books.google.com.au/books?id=cBGoDQAAQBAJ&printsec=frontcover&dq=The+Motor+Car+and+Popular+Culture+in+the+Twentieth+Century&hl=en&sa=X&ved=2ahUKEwj61rfipMDqAhXH4zgGHWXICvwQ6AEwAXoECAUQAg#v=onepage&q=The%20Motor%20Car%20and%20Popular%20Culture%20in%20the%20Twentieth%20Century&f=falseVolvo, 2018. “Volvo Cars aims for 25% recycled plastics in cars from 2025.” [online].Available:https://group.volvocars.com/news/sustainability/2018/volvo-aims-for-25-per-cent-recycledplastics-in-cars-from-2025Volvo Cars, 2020. [online] Available:https://www.volvocars.com/auVolvo Car Group, 2020. “Annual Report 2019” [online]. Available:https://investors.volvocars.com/annualreport2019/index.htmlReferences for ImagesFigure 1Volvo, date unknown. [online] Available:https://www.pinterest.com.au/pin/515662226061517967/Figure 2Armstrong, M, 2018. “Most Important Factors When Buying A Car”, Statista. [online]Available:https://www.statista.com/chart/13075/most-important-factors-when-buying-a-car/Figure 3Volvo, 2020. [online] Available:https://www.pinterest.com.au/pin/470555861059729620/Figure 4Volvo, date unknown. [online] Available:Page | 18https://www.reddit.com/r/Volvo/comments/1ogewg/invest_in_durable_goods/Figure 5Volvo, 2020. Facebook. [online]. Available:https://www.facebook.com/volvocarauFigure 6Volvo, 2020. Instagram. [online]. Available:https://www.facebook.com/volvocarauFigure 7Volvo, 2019. “Omtanke – We welcome you to try it.” Youtube. [online]. Available:https://www.youtube.com/watch?v=HgU8ebyHblcFigure 8BMW, 2020. “BMW’s Fasterpiece” [online]. Available:https://www.bmwmarkham.com/2013/02/19/bmws-fasterpiece/Figure 9Rossiter et al, 2018. “Marketing Communications: Objectives, Strategy, Tactics”, SageAustralia.Figure 10Tisshaw, M, 2020. “Volvo confirms electric version of next XC90.” [online]. Available:https://www.autocar.co.uk/car-news/new-cars/volvo-confirms-electric-version-next-xc90Figures 11 – 12Volvo, 2020. “Volvo XC90: Features and Specifications.” [online]. Available:https://www.volvocars.com/au/cars/new-models/xc90/specificationsFigure 13Stock image. [online]. Available:https://dissolve.com/stock-photo/Portrait-happy-family-sitting-royalty-free-image/131-890682Figure 14Bell, J, 2016. “Brand tradition: the Volvo XC90 paves the way to the future.” Wallpaper.com.[online]. Available:https://www.wallpaper.com/lifestyle/volvo-xc90-paves-the-way-to-the-futureFigure 15Alexander Skarsgard – date and photographer unknown. [online]. Available:https://www.pinterest.com.au/pin/435230751482102648/Figure 16Fung, D. “2020 Volvo XC90 facelift revealed, new mild hybrid drivetrains announced”Caradvice. [online]. Available:Page | 19https://www.caradvice.com.au/729379/2020-volvo-xc90-facelift-revealed-new-mild-hybriddrivetrains-announced/Figure 17Abrams, A. “Girls & Cars: European Vintage Ads.” Dark Roasted Blend. [online]. Available:http://www.darkroastedblend.com/2007/01/girls-cars-european-vintage-ads.htmlFigure 18As Figure 16.Figure 19Brands, C. ‘Volvo logo”. Car Logos. [online]. Available:https://www.carlogos.org/car-brands/volvo-logo.html

QUALITY: 100% ORIGINAL PAPER – NO PLAGIARISM – CUSTOM PAPER

Leave a Reply

Your email address will not be published. Required fields are marked *