Fiat 500

Fiat 500 Excel-Orators:Aleesha BorbelyAmandeep SandherColine LemanHarman ChunghHarvina SidhuMatthew CarlsonMegan Kalsbeek

1Aman

OverviewIntroductionProblem StatementTarget MarketKey FindingsSWOTCompetitive AnalysisThree AlternativesSolutionImplementation PlanCourse ConceptsReferences 2AmanIntroduction Fiat mission statementFiat 500 mission statement Founded in Torino, ItalyFirst Fiat FactoryFiat ZeroManufactured by ChryslerOwns 58.5% of Chrysler

Fiat mission statement:"To build cars with attractive styling and exciting engines, cars that are accessible and improve the quality of everyday life."Fiat 500 mission statement:"The association aims to; Promote and keep alive the interest in the Fiat 500, Its important historical role in Society, Its design, and to foster the common appreciation and love for the Fiat 500 by promoting friendship and solidarity between people without any discrimination of age, social background, economic status, nationality or race; create, promote and implement initiatives aimed at the conservation and continued use of the Fiat 500 cars on a day to day basis.Founded in: Torino, ItalyAt the end of 1800s

First Fiat Factory:Opened in 1900 in Carso, DaniteFirst year: produced 24 carsEmployed 150 workersFiat Zero:Debuted in 1912First mass-produced small engine carFiat owns: Alfa Romeo, Chrysler, Dodge, Ferrari, Jeep, Lancia, Maserati, and Ram.1979 Italian cars were at an all time high in US

3AmanProblem StatementWhat product strategies could Fiat use in order to increase market share and create brand awareness by the end of 2014?4AleeshaTarget market identificationNo defined target market Our assumptions:Generation YGeneration XBaby boomers

Fiat has no definite target marketWe assume that Fiat is trying to market to Gen X, Y, and baby boomers based on Casey Hurbiss statement who is the Head of Communications for Fiat in North America:After being out of the US market for 28 years, the challenge was to introduce the brand to generations X & Y that had little to no awareness of the Fiat brand, and to rekindle the baby boomers who remember Fiat from their youth.Gen Y:Born between 1977-1994Increased period of births. AKA echo-boom Includes recent to future 21 year olds the beginning of adult responsibilities and many new consumer activities Exerts influence on music, sports, computers, video games, and especially wireless phonesGen x: 1865-19776~15% of Canadian populationKnown as baby-lust era, because number of children born/year declined during this periodConsumers are: self-reliant, entrepreneurial, supportive of ethnic diversity and better educated than any previous generationNot prone to extravagance and are likely to pursue lifestyles that are blend of caution, pragmatism, and traditionalism Baby boomers: 1946-1864Growing olderBorn last time Fiat was popular in North AmericaGroup accounts for the majority of the purchases made in the consumer product and services categoriesReceptive to anything that looks or makes them feel younger

5AleeshaFiat 500Specialty product Came to North America for market developmentReturn to marketEuropean car of the year 2008First 500 in North America

Fiat 500 is a specialty product:Came to North America for market developmentReturned to market in July 2006, after 50 yearsWon European car of the year in 2008Fiat 500 in N. AmericaRedesignedBoasting a fuel-saving 4.9L/100km abilityGreener more affordable small carProduction started in Dec 2010

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aTotal Fiat sales in 2012:8474

Total Fiat sales in 2013 YTD:5803

Despite the addition of the 500L five door,September volume of Fiat cut by nearly 1000 cars compared to last year, as 500 sales (despite being 60 units shy of the monthly average in 2013) dropped 40 % year-over yearFiat 500: 2126 units, down 49 $ year-over-yearSept 2013: worst sales in 2013Trailed models 2013 monthly sales by average of ~1100 units500s worst monthly result since Jan 2012 7MeganSept 2013% ChangeYear to DateYTD % ChangeFiat 500455-34.3 %5803-18.6 %Dec 2012% Change2012 Year EndYTD % ChangeFiat 500449+58.1 %8474+52.2%FSales in Dec 2012 were 58.1% higher than what they were in Dec 2011 As a whole sales in 2012 were 52.2% greater than the year 2011

Sales in Sept 2013 were 34.3% lower than what they were in Sept 2012Sales in the year 2013, until Oct, are 18.6% lower than the year 20128MeganAuto sales in CanadaSubcompact car salesOverall new vehicle marketSeptember 2013Up 4% from last yearChrysler Canada Inc.

Canadian subcompact sales: down 6.8%Overall car sales + overall new vehicle market: up 3.5%Sept 2013:Set new record as market booms breaking last set record in 2002149,092 vehicles boughtUp 4% from 143,143 from a year earlierChrysler Canada Inc. sales rose 1.5%9Megan

Show where Fiat 500 lands in the small car sales in Canada10Market TrendsLeasingFuel economyGadget full carsChanging mid-size carsGen Y car chase

Leasing:Car leasing dropped to less than 10% with the financial crisis in 2008Over the last couple of years it is slowly beginning to ride2) Fuel economy:Car companies are serious about dramatically improving the fuel economy in virtually every vehicle they sell3) Gadget full cars:Cars are loaded with different multimedia featuresEven budget rides come with navigation system, satellite radio, Bluetooth interface, voice activation and no end of infotainment options including state of the art surround sound.4) Mid-size cars battle:4 door family sized carsNewest cars come with boasting sleek and sporty designs wrapped around comfortable packaging for five5) Gen Y car chase:Gen Y buyers: bunch of demands and no patience for old waysInternet savvy; dont like to haggle dealershipsWant good fuel economy in a reliable ride that feels just like an extension of their smart phones

11MattAssumptionsFocus on small and sexy carUsing a stereotypeGood ads that need brushing upAppearanceBrand is not well-knownIntriguing

Advertisements are good, but need to promote more specs (beats, eco-friendly, go-kart handling, safety, Eco:Drive, etc.)Model appearance is not as appealing to North AmericansLate entry into the market is the reason their brand isnt well known They think people will watch their commercials after being intrigued and do their own research about the car afterMain focus in ads is the small-car specTheyre only marketing their weakness of how unappealing the car is, hence all the sexy adsUsing a stereotype: just because its European, its sexy

12ColineFiat 500 SWOT Internal StrengthsWeaknessesEco-friendly carSmall carAffordableSafetyMultimediaUnstable historyLate arrival in North America Exterior aesthetic

Strengths:Eco-friendly:(4.9L/100km)Eco:Drive:Free app analyzes your driving style from Fiat 500 to computer/smartphone and suggests ways to adjust your driving for better fuel efficiency and lower emissionsFor 6th year in a row, Fiat has recorded lowest levels of CO2 emissions of any major European car companyMultiair engine:Electronically controlled hydraulic system that regulates engines intake values to maximize efficiency with every strokeResult: fuel economy up to 58 MPG on highwaySmall car:101hp with 5-speed manual transmissionAffordable:Pricing at $13,395+Safety:Bi-halogen projector headlamps:Focus more light on objects in your pathEye-catching curve around styling helps ensure youre more visible to other drivers7 airbags:Advanced multistage driver and passenger airbagsDrivers knee bag, side curtain and seat mountedElectronic Stability Control + All Speed Traction Control & Hill Start AssistAdvanced systems that apply selective braking and throttle control behind scenes to help you get where youre going confidently and safelyInsurance Institute for Highway Safety (IIHS) named it a 2013 Top Safety PickMultimedia:Blue&Me Hands-Free: allows control of audio system and bluetooth phoneVoice-activated TomTom navigation: hands-off approachFollow Me Home Function: headlights stay on when you leave the car; ~3.5 minBeats by Dre- Beats Audio:Premium sound systemCrystal clear sound is produced by 7 available premium speakers6.5 inch dual-voice coil subwoofer and eight-channel amplifier with Beats Audio digitial sound processing algorithm

Weaknesses:Unstable historyLate Arrival in North America2010Exterior aesthetic:Appeal more to European consumer than North America

13MeganFiat 500 SWOT External Opportunities Threats Booming market Cooperation with ChryslerIncreased gas prices

High competitionTrend to declined salesChanging commuter habits

Opportunities:Booming market?Green Canadian Consumer:People are becoming more eco friendlyIncreasing gas prices:

Threats:High competition:Eco friendly cars are increasingMore small cars coming around Changed habits:People are becoming greener, therefore:Making more use of transitBikingWalking14Coline

Competitive analysis Mini Cooper Strengths WeaknessesSafetyIconic designMade by BMW

ExpensiveMaintenance serviceInterior

Strengths:Safety:Automatic Stability Control + TractionPrevents wheels from spinningBraking:Anti-lock Braking System as standard and Cornering Break ControlEnsured by 4 disc brakesElectronic Brakeforce Distribution manages the balance of the braking force between front and rear axleBrake Assist speeds up the processEnables maximum braking pressure therefore minimizes braking distanceDynamic Stability Control:Prevents unstable driving situations by intervening in the engine managementApplies braking force to individual wheels at front and rear if necessaryAlso includes Hill AssistLighting:Bi-xenon headlights: adapt to direction of the roadRunflat tires:Emergency running properties6 airbags:Driver and passenger airbags protect the head and upper body during head on collisionSide and head airbags reduce risk of injury during side impact Complete all-around protection:Rigid collapsible steering column acts as a protective shieldProviding optimum protection in case of impact from front, rear, side or roll overIconic design:Classic lookMade by BMW:Reputable companyWell known

Weaknesses:Expensive:Starting at $23,920Maintenance service:Service needed way before set/approximated kmsParts/supplies take too long to come in/ dont come in on timeInterior:Big speed gauge in the center of the dashboard

15Matt/HarmanCompetitive Analysis: Ford Focus electric Strengths WeaknessesNo gas neededEco-friendlyCustomization optionsReduced maintenance costsLow/mile operating costLow driving rangeCharging stationsDistributionChargingExpensive

Strengths:No gas needed:Saves gas moneyEco-friendly:Zero emissionsCustomization options:Technologically advanced design which provides extensive customization optionsReduced maintenance costs over gas enginesVery low/mile operating costs

Weaknesses:Low driving range:100 mile driving range/chargeCharging stationsVery limitedNot many Limited distributionCharging:Must be plugged to recharge, unlike hybrid gas/electric vehiclesLong charging timesExpensive:$33,199

16Matt/HarmanBOSTON MATRIXStars:

Dodge

Question Marks:

FiatCash Cows:

Ferrari

Dogs:

LanciaRelative Market Share(Cash Generation)HighLowMarket Growth Rate(Cash Usage) LowHigh?

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17HarmanAlternative 1 - RepositioningAdvantagesDisadvantagesDefined target marketCompetitive advantageDistinction/separation from competitors CostlyRiskyCan cause confusionRepositioning: (Changing a brand's status in comparison to that of the competing brands. Repositioning is effected usually through changing the marketing mix in response to changes in the market place, or due to a failure to reach the brand's marketing objectives. Advantages:Defined target marketCompetitive advantageBrand position becomes more clear, which allows Fiats target market to identify better with itCan provide clear distinction/separation from competitorsDisadvantages: The major challenge of repositioning is that you have invested money and time to build up one image, and now you want to completely undo that effort to change perceptions. The risk with proactive repositioning is that you may move away from a steady position and audience into a new market or position that doesn't work out as you planned. Additionally, repositioning can lead to confusion in the marketplace, especially if you don't make a committed effort to the new position. If you waffle between the old and new, customers will more likely turn to a brand with a clear position.

18HarvinaAlternative 2 Co-brandingAdvantagesDisadvantagesBoosting brand imageBenefits from other companyExpanding outside the automobile industryBrand image dilutionComplex agreementsCulture clash

Advantages:Boosting brand image while increasing profitsAble to reach out to more and new prospects with your new products/servicesBenefits form other company:Can bring in benefits from partnering companys loyal customersExpanding outside the automobile industry:Products are introduced through other industries/markets

Disadvantages:Brand dilution:Brand isnt just linked to another brand but it also combines with its values and imageCustomers can be flustered between both brandsIf one brand experiences a disaster it reflects on the other brand as wellComplex Agreements:Requires a mutually beneficial agreement between two companies that protects legal integrity and systems of both brandsLong processes to reach agreementCulture Clash:Each franchise brand comes pre-loaded with a particular corporate or business culture that includes assumptions about best practices. Even in cases where businesses share similar cultures, the businesses should expect a relatively high cost for adapting the two cultures to work in a co-branded franchise. In situations where the companies do not share a consistent set of values, the differing assumptions driving each culture may turn a co-branded franchise project that looks good on the surface into a constant struggle for everyone involved. At the very least, businesses should investigate whether the other company or companies share compatible core values on major operational issues and financial management.

19ColineAlternative 3 Marketing researchAdvantagesDisadvantagesCustomer involvementTarget marketKnowledge

Unclear informationCostlyOutdated Research

Advantages:Customer is directly involvedResearch provides an insight to consumer needs and wantsTarget market:Clearer view over who to target and who notKnowledge:Know before hand if consumers will like the product or any other change or not

Disadvantages:Unclear information:Gathered information may not work for many peoples ideas/valuesNot all the needs/wants of the consumer may be able to be metExtremely Costly when compared to conducting secondary research Outdated research:By the time research is conducted and put to implementing; peoples thoughts/ideas may change20AmanSolutionRepositioningWhy?Brand position has become confusingA defined target marketFiat brand is not well knownPossible target markets:The suburban commuterThe urban consumerThe independent student

Fiats brand position in the market has become confusing, so we believe repositioning it is the best optionThis allows for a more defined target marketCreates brand awareness among consumers

The alternative we chose is Repositioning because we think that Fait needs to take the top of the mind approach to its promotion and advertising. The more often the consumer is reminded of the brand the more likely they are to think Fiat 500 when it comes to purchasing that new car. Fiat has the competitive advantage on its Interior & stylistic design also its innovation and fuel economy. It is the most affordable compact car in its class. Repositioning Fiat to promote these advantages will give the 500 the edge it needs to take the lead over its competitors and increase market share and brand awareness. We need to start a media Blitz so the consumer need to see Fiat absolutely everywhere. The consumer need to know why they should buy the fiat over its competitors. So rather than simply taking sexy approach. We need to promote what the consumer will benefit from the car and what makes it unique and valuable.

Possible target Markets:

Trendsetters- men and women in the public eye who catch consumers attention with their unique character. With people developing a sense of trust for them, trendsetters inspire people with their style, attitude, belief and advice

1. The Suburban Commuter lives in the suburbs & commutes to the city Usually younger because they cant afford to live in the city . Want to save money on gas so fuel economy is importantspend a lot of time in the vehicle s interior and entertainment ie. sound system are important to them Price conscience likes to car pool, so four seater is appealingMen & Women: Age 20-35

2. The Urban ConsumerSmall car makes it easier to park and has better mobility around the city Stylish and hip. Features and aesthetics are important to them Enjoy affordable luxury Are eco-friendly and appreciate sustainability Can be trend setters Men and Women Age 20-35

3. The Independent Student not much disposable income but need a reliable, economical car at an affordable price.like to keep up with new trends responds well to innovation, unique features, and aesthetics Men & Women: Age 19-30

21Marketing mixProductPricePlacePromotion

Product: (Harvina)Change the look to better appeal to the North American ConsumersChange the specs to introduce the Fiat 500 to consumers that like more power in their carsHenry Ford once said the customer could have any color car, as long it was black Mass customization is the reverse; it gives every customer the ability to choose any color.

Price: (Harvina)Keep selling price of Fiat as isImplementation plan costs?

Place: (Harvina)North America could potentially still be a very profitable area for FiatGet more of their own dealerships, instead of selling through ChryslerAt least one/major cityMore toward city life that have small/tight streets as compared to country siders

Promotion: (Aleesha)Promote Fiat as a luxury compact car as more affordable in its classPromote the interior of Fiat as it provides a competitive advantage over competitionPromote specs rather than just the look (small and sexy)Talk safetyMultimediaEco-friendly featuresMedia Blitz needs to be everywherePromote how consumer will benefit buying a Fiat over another carNewspaper ads, radio ads, trade shows, viral marketing (social media), Billboard ads, etc.TV commercials promoting JD Power and Associates awards and reviewsNo one knows about theseProvide loyalty programs for customers 22timelineStage 1: Conducting researchMaking changesStage 2: PromotionsNov April: Viral marketingDec April: NewsprintJan April: Television commercials Feb April: Radio, Billboard, Bus adsStage 3: Trade showsJan 18-26, 2014 North American International Auto ShowApril 18-24. 2014 New York International Auto Show

Stage 1 (complete): Conducting research as to why Fiat isnt selling as much as theyd like toMake any changes to the Fiat itself Stage 2: Promotions:Nov-April: A full 6 months of Online advertising, social media & viral marketing, Youtube, Flickr, Instagram, Facebook, Twitter, etc. Google social media platformsDec April: 5 months of weekly half page, full colour Newsprint ads in national papers. Vancouver Sun, The Province, New York Times, Washington Post, L.A Times, Detroit Press, Toronto Star, etc.Jan April: Launch frequent Television Commerials (variety of channels) just before attending the trade showsFeb April: 3 months of Radio, Billboard, and Bus adsStage 3:Jan 18-26, 2014: Attend the North American International Auto Show (NAIAS) in DetroitApril 18-24, 2014: Attend the New York International Auto Show

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Course conceptsClassification of consumer goodsTarget marketMarket segmentationSWOT analysisCompetitive AnalysisPositioningMarket researchMarketing MixB2C marketingClassification of consumer goods:Specialty goodTarget market:Fiat has an undefined target marketMarket segmentation:Segmenting market based on demographic, psychographic, behavioral, and geographical characteristics when defining target market and in plan of actionSWOT analysis:Analyzing Fiats internal strengths and weaknesses, as well as its external opportunities and threatsCompetitive analysis:Strengths and weaknesses of Mini Cooper and Ford Focus electric compared to Fiat 500Positioning:StrategyMarketing research:Alternative strategyMarketing mix:Used in the repositioning strategy where the 4 Ps were altered

25AmanReferences2013 Focus. (n.d.). Retrieved October 2013, from Ford:http://www.ford.ca/cars/focus/trim/?trim=electric Barth, L. (2013, August 14). Car brands: Who owns what? Consumer Reports. Retrieved October 2013, from ConsumerReports.org: http://www.consumerreports.org/cro/news/2009/06/car-brands-who-owns-what/index.htm Beats Audio. (n.d.). Retrieved October 2013, from Beatsbydre: http://www.beatsbydre.com/beats-audio/ Cain, T. (2013, January 22). December 2012 and 2012 Year End Small Car Sales in Canada. Retrieved October 2013, from Good Car Bad Car: http://www.goodcarbadcar.net/2013/01/canada-december-2012-small-car-sales-figures.html 26Cain, T. (2011, January 1). Fiat 500 Sales Figures. Retrieved October 2013, from Good Car Bad Car: http://www.goodcarbadcar.net/2011/01/fiat-500-sales-figures.html Cain, T. (2013, October 16). Small Car Sales Figures in Canada - September 2013 YTD. Retrieved October 2013, from Good Car Bad Car: http://www.goodcarbadcar.net/2013/10/canada-small-car-sales-figures-september-2013-ytd.html Cato, J. (2012, August 22). Trending topics in auto industry. Retrieved October 2013, from The Globe and Mail : http://www.theglobeandmail.com/globe-drive/new-cars/auto-news/trending-topics-in-the-auto-industry/article4491650/?page=all Crocker, J. (2013, October). Drive My Brand: FIAT's Search for Success. Retrieved October 2013, from Google-Think Insights: http://www.google.com/think/articles/search-revs-fiat-brand.html Fiat. (n.d.). Retrieved October 2013, from Fiat Canada: http://www.fiatcanada.com/en/500Fiat 500. (n.d.). Retrieved October 2013, from MSN Autos: http://autos.ca.msn.com/showroom/new-cars/gallery.aspx?cp-documentid=29059022&page=6 History. (n.d.). Retrieved October 2013, from Fiat: http://www.fiatspa.com/en-US/group/history/Pages/default.aspx Keenan, G. (2013, October 1). Vehicle sales hitting top speed in Canada. Retrieved October 2013, from The Globe and Mail: http://www.theglobeandmail.com/report-on-business/chryslers-us-sales-rose-1-per-cent-in-september/article14621411/

McCausland, E. (2013, October 1). Chrysler September Sales: Fiat and Jeep Have Tough Month. Retrieved October 2013, from Motor Trend: http://wot.motortrend.com/chrysler-september-sales-fiat-and-jeep-have-tough-month-411907.html#axzz2glT6jVe8 Mini Cooper. (n.d.). Retrieved October 2013, from Mini: http://www.mini.ca/en/mini/cooper/ Origins and development. (n.d.). Retrieved October 2013, from Fiat 500 Club Italia: http://www.500clubitalia.it/index.php/component/content/article/436