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Marketing Campaign for Dodswagen Volkswagen Disguise Company

MarketingCampaign for Dodswagen [Volkswagen Disguise] Company

ExecutiveSummary

Thepurpose of this paper has been to devise a social marketing campaignfor Dodswagen. While the company is among the leading automotivecompanies in the world, the recent emission scandal dealt it a bigblow. Despite the fact that the company has remained committed toaddressing its failures and picking up the pieces, it has notsucceeded in getting its performance on track. Part of the focus ofstrategy to enable the company to regain its competitive advantagelies social media marketing plan, whose primary goal is to supplantthe negative publicity that the company no longer has a place inproducing sustainable cars. A look at the market reveals the presenceof strong competitors. The top competitors include Toyota, Ford,General Motors, BMW, Honda, Hyundai, Chevrolet, Subaru, Daimler AG,Kia and Buick, Fiat. These competitors are strong and can edge themarket share of Dodswagen if it does not embrace informed strategicmeasures. The consumers and suppliers have high bargaining power,too. The ability of the Dodswagen to succeed largely depends on theextent it is willing to go to appease its potential consumers. Thepresent consumers are demanding and make rational choices sensitiveto company’s reputations, corporate social responsibility andproduct quality attributes. Therefore, it was not surprising that thecompany registered heavy losses following the scandal. The marketinggoal is to subvert the effect of the negative publicity the companyhas faced and put it to track and to seek to leverage an edgingcompetitive advantage. The campaign will last for 12 weeks and itsdesign will focus on commitment to value, environmentalsustainability, change and brand uniqueness. Google, Facebook andTwitter will be used as the complaint sites, while Yelp would be usedfor pay-per-click promotions. This choice of platform is based ontheir popularity.

TheDodswagen Company Overview

Dodswagenis a German automotive company headquartered in Wolfsburg. Thecompany was established in 1937, having been commissioned by theGerman Labor Front. The company is rated as the world’s largestautomotive company, and it is part of the Dodswagen Group’sflagship marquee. The company’s operation slogan is ‘Dodswagen,which is a German translation for ‘people’s car’. Initially, inthe early 1930s, the Germany automotive industry was largely orientedtowards the production of the luxury car models. As such, it wasrelatively difficult for an ordinary German to afford any automobile,not even a motorcycle. The automotive market stature of the timeallowed only a few people to own cars. In looking for new marketopportunities to exploit, some manufacturing companies began lookingto producing cars that would be affordable to a majority of people.Some of the projects that were initiated included the Mercedes 170H,Hanomag 1.3L, Adler AutoBahn and Steyr 55. Such projects triggered anew wave of scrambles of the low-economy automobile market, resultingto the establishment of the Dodswagen in 1937 (Volkswagen, 2015). Thecompany uses both direct and indirect distribution channels to sellits cars. It employs over 610,076 across the world. The topcompetitors include Toyota, Ford, General Motors, BMW, Honda,Hyundai, Chevrolet, Subaru, Daimler AG, Kia and Buick, Fiat. Thecompany’s offline marketing strategy is guided by the 4Ps, focusingon placement, pricing, promotion and product attributes (Volkswagen,2015).

Sinceits establishment, the company has been making strategic adjustmentsover time, which has enabled the company to grow and become thelargest automobile companies in the present world, and this is albeita few background challenges such as the bombing of assembly units bythe US Air Force during the Second World War. The company is nowinternational firms, comprising of factories in different regions ofthe globe that either manufactures or assembles vehicles. Apart fromits Germany-based plants, the company also as its assembly andmanufacturing plants in the United States, Indonesia, Brazil,Portugal, Russia, India, Slovakia, Mexico, Spain, Poland, Bosnia,South Africa, Herzegovina, Czech and Russia. Based on profitability,Forbes named Dodswagen as one of the world’s top 25 largestcompanies. In addition to its exemplary performance, the company isstill committed to establishing additional subsidiary manufacturingand car assembly companies across the world. For instance, thecompany is currently setting up a factory in Indonesia, which hasbeen under construction since 2013. When completed, the plant willventure in the production of large transporting tracks and vans. InJanuary 2016, Dodswagen announced that it would launch a new factoryin Algeria as part of its efforts to exploit the opportunities in theAfrican market. Besides, the company is also planning to start anengine processing plant in India to ease congestion. Some of theCompany’s popular car brands include Up, Fox, Pollo, Beetle, Gold,Jetta, Passat, CC, Sharan, Tiguan and Touareg (Volkswagen, 2015).

Thecompany is also popular for its innovativeness strategies aimed atmeeting the market demand. Some of the notable ventures have includedthe manufacture of electric, hybrid, and fuel-alternative vehicles.For instance, the fuel crisis of 1973 motivated the Dodswagen doBrasil to develop Neat ethanol vehicles to serve the market amidstthe low oil supply. The production of the line of cars only haltedwhen the technology was supplanted by the Flex Fuel technology. In2003, the Dodswagen celebrated its launching of the VWGol 1.6 Total Flex, its first flexible fuel car with the capabilityof running on E100 and gasoline blend. In the same year, Dodswagen doBrasil also launched the Gol1.6 Total Flex, becoming the firstcommercial fuel alternative car to run on the E20-E25gasoline and E100. The project was so successful that it renewed theconfidence of the consumers in the ethanol-powered vehicles, pavingway for increased adoption of the Ethanol cars. As of 2005, thecompany has been liaising with Sanyo to develop efficient batterysystems to support its planned production of electric cars. Dodswagen hopes to produce hybrid matches to Golf and Polo. The two cars havebeen considered as the choice for electric cars because they areprided as the most environmentally friendly cars. Besides, DodswagenXL1is the most fuel efficient car in the world (Vizard,2015).

Despiteits innovative record, Dodswagen has a poor environmental record. Forinstance, in 1974, the company was fined $120,000for installing the ‘defeat devices’ that allows one to disableenvironmental control pollution systems, which were considered aviolation of the United States Clean Air Act. The 2015 emissionscandal has been perhaps one of the most publicized environmentalviolations, resulting in far-reaching consequences on companyperformance. The company was accused of lying about installing‘defeat device’ that limits emissions just to circumvent theenvironmental regulations. The company was severely hit by thescandal. The company was ordered to recall over 82,000 cars, whilethe company was fined $15.3 billion, becoming the largestauto-related fines in the annals of the US. The stock prices of thecompany also fell by 20 percent just a day after the news headheadlines, with beaming negative publicity discussions on the socialmedia and beyond. The management resigned. Its global market sharealso reduced in 2015-2016 financial year to 11.2percent, compared to 12.4 percent recorded in the year before thescandal was exposed (Volkswagen,2015).

Despitethe fact that the company has remained committed to addressing itsfailures and picking up the pieces, it has not succeeded in gettingits performance on track. Certainly, the scandal has served as theopportunity for its key competitors such as Toyota, Mercedez, andHonda to leverage a competitive advantage. Part of the strategy toenable the company to regain its competitive advantage lies socialmedia marketing plan, whose primary goal is to supplant the negativepublicity that the company no longer has a place in producingsustainable cars (Vizard, 2015).

TheTarget Market and Market Research

DetailedDescription of the Market

Theautomobile sector is a vibrant industry. An evaluation of the marketbased on Porters’ Five Force analysis reveals that it is has amyriad of opportunities, but some of elements of threats that anycontesting firm should consider. The outlook of the market isdiscussed in the corresponding sections as follows.

Threatsof Existing Competitors:The Company faces stiff competition from various competitors. The topcompetitors include Toyota, Ford, General Motors, BMW, Honda,Hyundai, Chevrolet, Subaru, Daimler AG, Kia and Buick, Fiat. Thesecompetitors are strong and can edge the market share of Dodswagen ifit does not embrace informed strategic measures.

Threatsof New Entrants:The market comprises of strong, dominant competitors that make itrelatively difficult for new entrants to emerge and penetrate themarket. However, the market share will still be sensitive to anyentrant, however insignificant their market share can be. ForDodswagen to remain on top, it must be aware of this threat andembrace necessary measures.

Threatsof Alternative Products:Although there are various alternatives to its products, the productsthat the company produces (mostly cars) occupy a certain niche thatcannot be easily subverted by alternative products, howevercost-efficient and environmentally motorcycles and bicycles they canbe. The lifestyle continues approve possession of cars, implying thethreats of alternative products are not critical.

SupplierBargaining Power:With several competitors scrambling for market share and in the warto outperform each other, the suppliers are presented with highbargaining power. The suppliers have the choice to make what of theseveral competing firms they can work with, a decision based on theoffers the firms have for them. This case scenario essentially meansthat Dodswagen must be tactical in the way in deals with itssuppliers.

ConsumerBargaining Power:The consumers are also presented with high bargaining power. Theyhave several choices of products from different automobilecompetitors to choose. In this regard, the ability of the Dodswagento succeed largely depends on the extent it is willing to go toappease its potential consumers. The present consumers are demandingand make rational choices sensitive to company’s reputations,corporate social responsibility and product quality attributes.Companies such as Dodswagen will need to consider such demands andintegrate them in the value chain processes.

Theautomotive industry is a large multinational business that mustoperate across different political regimes. In this regard, it issusceptible to political risks. To be successful, an automotivecompany needs to choose its operations bases wisely, and considersetting up assembly and manufacturing plants in regions withpolitical stability. The automotive company is sensitive to economicchallenges such as currency fluctuations and other forms of financialdownturns.

DodswagenOverview

Thecompany operates in a relatively stable environment. Indeed, most ofits manufacturing and assembly plants are based in countries thatenjoy political stability. Apart from its Germany-based plants, thecompany also as its assembly and manufacturing plants in the UnitedStates, Indonesia, Brazil, Portugal, Russia, India, Slovakia, Mexico,Spain, Poland, Bosnia, South Africa, Herzegovina, Czech and Russia.In this regard, the company operations suffer from limited politicalrisks.

Theautomotive industry is vibrant, with several competitors competingfor the market share. Despite this competition, Dodswagen stilloccupies a competitive position and has the largest global marketshare compared to other companies. This observation is easilydiscernible from the chart above

However,it is still worth noting that the company performance varies acrossregions, and it is in some instances dominated by the competitors.The chart below summarizes the performance of Dodswagen marketperformance in different regions, relative to its competitors(Volkswagen, 2015).

Ascan be seen, the company only happens to enjoy a monopolized marketshare in the Western Europe. It performs fairly in Asian Pacific, andpoorly in North America. Therefore, the ability of the company toremain on top of the world market relies on the extent it is willingto market itself and leverage an edging competitive advantage.

Thebehavior of the target consumers is also diverse. The motivations forthe product consumption choices can be best conceptualized based onthe Eastman and Eastman (2015) model of consumption theory. The chartbelow highlights the motivations of car consumers.

Ascan be inferred, the purchase of the company products is mediated bytwo factors: the external and internal factors. The external factorsdescribes situations in which consumers make choices based on whatthe perceptions the society holds, while the internal factors arisefrom the circumstances in which people buy products for self-rewardand fulfillment. The external factor sis mediated by the Veblen,Snob, and Bandwagon effects. The internal factors are mediated byhedonism, self-concept, and perfectionism (Vizard, 2015). Therefore,the capacity of successful marketing particularly lies in how theprocesses will be able to integrate these elements into the marketcampaign.

Therefore,the customers are rational and conscious than ever in checking forthe products they use. Their choices are sensitive to the any form ofnegative publicity the company faces. Therefore, it is not surprisingthe emission scandal dealt the company a big blow. The potentialcustomers use the social media for socialization, yet they also usethe platforms to check information about company dealings, and evenopen forums for discussion about company products. Therefore, it isexpected that any information about a scandal would reach a largeaudience, and the negative information would translate to purchasedecisions. The figure below presents a market reaction to thecompany’s scandal news (Flammang,2016).

Inessence, for the customers, the choice of firms to exercise socialresponsibility is no longer discretionary, but obligatory. A companythat does not uphold social responsibility by avoiding scandals,producing quality products, giving back to the society and seeking toprotect the environment has high chances of succeeding in the market.Therefore, a typical successful marketing campaign should seek toappease the market by considering these elements.

Indeed,these elements also happen to be the key areas of focus for thecompeting companies. A look at the social media marketing campaignsof the key competitors such as Toyota, Ford and General Motors,reveals they do not only lay emphasis on production of qualityproducts that meet the consumer needs, but also communicate theircommitment for social responsibility, including protecting theenvironment and following the legal provisions. The competitors arealso outgoing in their use of social media. Therefore, for Dodswagen,the emission scandal comes as a major blow that ultimately gives aleeway for the competitors to close the gap. Such an observationjustifies the criticality of the Dodswagen to conduct an integratedsocial media marketing campaign to subvert the effects of thenegative publicity.

Justificationof the marketing choice

Thechoice of market is UK. This market is chosen because it had highfluctuations in the sale after the information of negative publicityhit the headlines. The region is also the major market for thecompany. Three social media sites are chosen as tools for thecampaign: Google, Facebook and Twitter. The choice is guided by theirpopularity. They are not only used for social media campaigns, butalso business promotion campaigns.

Campaigngoals and evaluating the methods of success

Themarketing goal is to subvert the effect of the negative publicity thecompany has faced and put it to track and to seek to leverage anedging competitive advantage. To be able to accomplish this goal, anumber of targets will be considered and are stated as follows.

  • To increase the number of Facebook likes to over 700 million in Europe

  • To generate the Twitter followership of 700 million in Europe

  • To increase the Google ranking of company’s positive image to the top of the list of company information searches

  • To regain the sales level and boost the performance by 5 percent

Thesocial campaign will focus on three social media sites, that is,Twitter, Facebook and Google. All these sites generate real timereports concerning the number of people that accessed it. Therefore,it will be relatively ease to measure whether target would have beenachieved. Google provides the Google Analytics tool that one can useto check the general traffic and the demography of the participantsthat the campaign information reached. It also provides theinformation on general geographical information of the audience andis generally easy to rate the performance of the campaign. Facebookand twitter do not provide detailed analysis of the audiencedemography, but it gives the precise number of the audience thecampaign information reached.

Thecampaign will run for twelve weeks. The timeline of the social mediamarketing is summarized in the chart below. It is worth noting thatthe Google, Facebook and Twitter will all run at the different times.

Activity

Week 1

Week 2

Week 3

Week 4

Week 5

Week 6

Week 7

Week 8

Week 9

Week 10

Week 11

Week 12

Budgeting

Designing Promotional Content

Designing and Choosing Website hosts

Going Google

Going Facebook

Going Twitter

Evaluation of outcomes

Implementation

Tobe able to meet the intended goals and objectives, the design of thesocial media campaign will be oriented towards various elements thatinterest the potential consumers and other groups of stakeholders.These elements include commitment to value, environmentalsustainability, change and brand uniqueness. The essence of focusingon these aspects is to be able to appease the interests of theconsumers, considering this are some of the elements that theconsumers base on to purchase the product.

Inline with the implementation strategy, the landing page will bedesigned to reflect all the elements of elements that interest theconsumers, while the key words would be chosen to optimize thetraffic to this page. The key words would be “Dodswagen, Quality,Value, New Environmental Sustainability, Unique Products, and theChange/Reforms”. The image below is the screenshot of a mocklanding page

Theoptimization elements are outrights and aimed at communicating theitems of interest for the consumers and supplant the tainted image.To ensure that the information reaches a large audience, the campaignwill also rely on per-per-click to support the boost the traffic tothe created site, “Re-engineering Dodswagen”. One company will becontracted to support this campaign — Yelp. Yelp essentially offerstwo categories services to the users provision of information onservices and goods accessible within certain locations, and socialnetworking.

Bilton(2011) provides perhaps the most comprehensive list of benefits thatcustomers get from Yelp. The first benefit is that it containsinformation about great businesses within specified locality, forexample, those offering luxury services, low-priced or high-qualitygoods and services that may interest customers. Secondly, Yelpenables consumers to search for the most nearby services,restaurants, and shops, for which they might need to access withoutcovering long distances. Thirdly, Yelp enables customers to filterthe results by specifying what they need by keying in certain detailssuch as neighborhood, customer ratings, and prices. Fourthly,customers can read various reviews written by other clients orexperts, and be well informed on purchase decisions. Fifthly, Yelpalso features photos of businesses, which enable customers to have aclear impression of the featured services and products. Moreover,customers can also find contact addresses, make reservationsremotely, as well as contact businesses. Therefore, the main reasonwhy customers should use Yelp is that it has various functions thatcan enable consumers to make informed choices, yet it also allowsthem to participate in improving the user experiences by providingreviews.

Yelpbusiness model is essentially oriented towards direct selling. Yelpsells its products and services directly to its customers,facilitated by the presence of the internet distribution andcommunication channel that enables it to interact directly with theconsumers. Indeed, with the availability of sophisticatedtechnologies, Yelp can deploy customer relationship management (CRM)tools to perform various functions remotely, such as managingrelationships with its customers and information that concerns it.The CRM tools are designed in the manner that allows Yelp to storeinformation of customers, and to identify business leads, andopportunities. The CRM tools also allow Yelp to interact with itscustomers seamlessly, automate sales, provide customer support,perform marketing tasks, and manage relationships with partners.Therefore, Yelp`s business model is ideally cost-effective (Yelp,2016).

Yelpprovides various benefits to businesses in many ways. As documentedby Rubin (2012), first is that Yelp has a feature that enablescompanies to publish information about their businesses, such aslocations and their pricing and quality offers. Yelp also business toupload photos of their services and products, which creates theallowance for customers to have a clear impression of the featuredbusinesses. Once published, such information leads customers to thebusiness. Indeed, Yelp has features that enable customers to filterthe results by specifying what they need by keying in attributes ofthe products they need.

Secondis that Yelp allows businesses to benefit from the reviews. Yelpfeature allows customers to read and write reviews, and rate thegoods and services. On one hand, businesses can use the reviewsubmitted information to make decisions on the way of improving theirstandards to meet the customer demands. Indeed, this is possiblebecause reviews include comments of areas of weaknesses that may needimprovement and areas of strength that businesses can capitalize. Onthe other hand, businesses can also benefit from the reviews byearning a good reputation, and this is particularly the case when thereviews are positive enough to attract new customers. The third waythat businesses can benefit from Yelp is advertising. By using Yelp,businesses can advertise goods and services they offer to thecustomers on the pay-per-click basis. Businesses can also pay to havethem appear at the top of competitors in terms of search results.Considering Yelp has many visitors, the businesses can easily earnrecognition through advertisement. Lastly, Yelp also allows companiesto sell their products directly. Customers can make reservations forgoods and services online. In this regard, the main reason whyDodswagen should use Yelp is it supports business promotionactivities. While there are other sites such as booking.com, and TripAdviser, Yelp is advantageous because it is a popular site with alarge traffic of users that make businesses easily recognizable(Marx, 2014).

Conclusion

Thepurpose of this paper has been to devise a social marketing campaignfor Dodswagen. While the company is among the leading automotivecompanies in the world, the recent emission scandal dealt it a bigblow. Despite the fact that the company has remained committed toaddressing its failures and picking up the pieces, it has notsucceeded in getting its performance on track. Certainly, the scandalhas served as the opportunity for its key competitors such as Toyota,Mercedez, and Honda to leverage a competitive advantage. Part of thestrategy to enable the company to regain its competitive advantagelies social media marketing plan, whose primary goal is to supplantthe negative publicity that the company no longer has a place inproducing sustainable cars.

Alook at the market reveals the presence of strong competitors. Thetop competitors include Toyota, Ford, General Motors, BMW, Honda,Hyundai, Chevrolet, Subaru, Daimler AG, Kia and Buick, Fiat. Thesecompetitors are strong and can edge the market share of Dodswagen ifit does not embrace informed strategic measures.

Theconsumers and suppliers have high bargaining power, too. The abilityof the Dodswagen to succeed largely depends on the extent it iswilling to go to appease its potential consumers. The presentconsumers are demanding and make rational choices sensitive tocompany’s reputations, corporate social responsibility and productquality attributes. Therefore, it was not surprising that the companyregistered heavy losses following the scandal.

Themarketing goal is to subvert the effect of the negative publicity thecompany has faced and put it to track and to seek to leverage anedging competitive advantage. The campaign will last for 12 weeksand its design will focus on commitment to value, environmentalsustainability, change and brand uniqueness. Google, Facebook andTwitter will be used as the complaint sites, while Yelp would be usedfor pay-per-click promotions. This choice of platform is based ontheir popularity.

References

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