Phantom by Rolls Royce
We are doing a group project and this is a part I’m assigned for it. We are researching on the car Phantom by Rolls Royce and basically preparing a marketing analysis for it. Below the question im asked is related to the target market. The people Rolls Royce targets with its phantom. In order to answer the question you need to know the internal and external analysis and also the product and customer analysis which is in the pages below. Pretty much like identify the target market.
Question:
8. The Market-Product Focus:
In this section, you determine the target market and the product offering for the target
market. Different from the internal and external analysis reported above, this section
involves decision making, that is, you need to decide and justify which market segment
as the target market, and the specific products that you will offer to the target market.
The market-product focus decision should be logically based on internal and external
Analyses, especially the product and customer analyses.
Instructions:
In order for you to answer the question above please refer to the (internal and external
analyses, especially the product and customer analyses) below in this page. You can use whatever is in the page below to answer this part or use sources online (no Wikipedia). Basically you are required to discuss the target market. Which as you know for a luxury car such as Rolls Royce, it targets wealthier people. You are also required to discuss Market Segments, which is basically grouping buyers with similar needs and will respond to a marketing action. So like in the concept of how does rolls Royce use market segments.
2 key elements to be discussed and related to are market segments and target market.
Please read the
Written
“Strive for perfection in everything you do. Take the best that exists and make it better. If it does not exist design it” (Sir Henry Royce). The mission statement of Rolls-Royce Motors defines the business, its customers and the products. This mission statement has been in existence for over 90 years and it has been unchanged. The company still follows the same mission of offering its high-end customers the best automobiles.
There are many competencies that Rolls-Royce motors possesses that other automobile companies don`t. Rolls-Royce is a well-established name in the luxury cars market. This gives Rolls-Royce a competitive advantage over competitors. Buyers will consider Rolls-Royce more than competitors such as Scion, FIAT or Lincoln due to a well-established and reputable brand image. The second competency is personalization of vehicles. Buyers of Rolls-Royce vehicles can choose from 44,000 paint colors and can specify any leather color. Rolls-Royce’s TotalCare programme is where engineers in Derby monitor performance of engines in Rolls-Royce vehicles. They use the technology to improve future automobiles. The next competency Rolls Royce possesses is the large number of dealerships the company has expanded in large cities across the world. Unlike other companies like Ferrari, Porsche and Bentley there are many dealerships which make it easy for buyers to purchase and access vehicles.
Situation Analysis
It is famous in the automobile industry that 2 major brands tower above the others; Ferrari for performance and Rolls-Royce for comfort. In addition to comfort and luxury, Rolls-Royce vehicles also satisfy the requirement of high performance and reliability. Rolls-Royce vehicles are known to be relatively quiet despite a 6.6-liter twin-turbo V12 engine with 563 horsepower (Simona 2012). The cars are flawless and stay on the road for many years. 6/10 Rolls Royce built are still roadworthy. Customers see a Rolls-Royce as a very high-end, reliable, luxurious vehicle. It is a vehicle that symbolizes their high status in society. This high status is represented by owning a relatively high-end, top of the industry vehicle. Rolls-Royce is satisfied by the reviews of buyers as they meet the goals of Rolls-Royce Motors of delivering a reliable, high-tech vehicle with outstanding performance. Rolls-Royce is stable brand in the automobile industry. Rolls-Royce is a leader in luxury vehicles. When a buyer considers purchasing a high-end vehicle, Rolls-Royce is among the initial brands that come to awareness.
Rolls-Royce Motors uses a unique marketing approach. Rolls-Royce markets through pop culture in which celebrities and stars are shown with Rolls-Royce vehicles. David Beckham, Jay Z and Diddy are a few celebrities seen driving Rolls-Royce automobiles. Rolls-Royce has also marketed through an i-Phone app. The iPhone application includes both interactive features, such as the ability to personalize a virtual Ghost vehicle, as well as photo and video content. (Finocchiaro 2010). Rolls-Royce marketing targets specifically the few well-off individuals. One advertisement in a newspaper read, “to the 100 people that will become Rolls-Royce owners this month” (Marbury 2008). What Rolls-Royce is unable to do is buzz marketing. Due to the small market consumer interactions do not play a significant role in increasing demand for Rolls-Royce vehicles. The reality is there are a very limited number of individuals that purchase a Rolls-Royce automobile each year.
Rolls-Royce is an automobile division owned by the BMW Group. It is financially stable and has seen constant growth over the past 2 years. From 2010 sales of Rolls-Royce vehicles have increased by more than 30%. Overall BMW Group has made a net profit of $3,134,000,000 in the 2011 fiscal year (BMW Group 2011). Part of the net income can be used for expansion of the Rolls-Royce division.
Research and development is a significant part of Rolls-Royce. Rolls-Royce is always looking for new innovations and advancements in its automobiles. Each year Rolls-Royce, in collaboration with its partners, invests around $1.4 billion in Research and Development. Rolls-Royce North American Technologies Inc., known as Liberty Works, develops technology for advanced gas turbine propulsion and power systems. Recent successes include: the Integrated High Performance Turbine Engine Technology, Versatile Affordable Advanced Turbine Engine program and the Joint Strike Fighter program. Also Rolls-Royce continues to research global fuel cell development that is aimed at developing a megawatt scale commercially-viable fuel cell power system (Rolls Royce 2012).
Among the major strengths of Rolls-Royce is their management team. Rolls Royce has a well-focused, educated team with experience in business and engineering. Their diverse backgrounds provide Rolls-Royce with a pool of different skills and experience in various fields such as sales, engineering and marketing. Most importantly all managers and workers are committed and continue to expand Rolls-Royce in the high-end automobile market. Ashley Andrew joined Rolls-Royce from the BMW Group, where he is currently Sales Operations Manager based in Bracknell. Ashley has broad industry experience particularly in the areas of dealer management and operations and has been deeply involved in the sales and marketing area having previously held positions as BMW UK National Sales Manager and prior to this as a brand manager with Ford of Britain. David Archibald is the President of Rolls-Royce North America. Archibald is the Rolls-Royce’s Regional Director for Europe and South Africa. Ashley Andrew and David Archibald are both seasoned and experienced motor industry executives (Ball 2010).
External Analysis
There are a great number of technological advancements in automobiles over the past few years. Some major advancements include; rear-mounted radar, night vision with pedestrian detection, automatic high-beam control, parental control, GPS vehicle tracking, cameras, driver capability and in-car Internet (Heaps, 2012). In order to maintain their image as a leading automobile company in the world, Rolls-Royce must add these features to their own vehicles. If they fail to do so buyers will question their vehicles and may consider competitors that do meet new technological advancements in their cars.
Automobile regulations such as safety standards and emission standards are two concerns for Rolls-Royce Motors (Industry Canada 2011). Vehicles must compromise with these standards in major markets in the world as these two regulations are common in many parts of the world. Rolls-Royce vehicles such as the Phantom can benefit from safety standards. The vehicles have a very high safety standard which adds value in the customers purchase. On the other hand, emission standards are a concern for Rolls-Royce due to the large V-12 engines. Even if the vehicles do pass the emission standards they are a concern for environmentally conscious buyers.
Pop culture and celebrity trends could positively influence the sale and demand of Rolls-Royce vehicles. There are more celebrities and stars driving Rolls-Royce cars. Stars such as; David Beckham, Jay Z and Diddy have been recognized with the high-end vehicles. Music videos also display the cars and portray the message of a higher status if a person owns one. This social culture increases the demand for Rolls-Royce automobiles.
Economic recession has not affected Rolls-Royce sales due to a different target market. Rolls-Royce buyers are wealthy individuals that are not affected by poor economic times. If inflation increases than company costs will also increase. Production costs of vehicles will increase as parts will become more expensive. On the other hand, a lower inflation rate can cut costs and ultimately increase profit. Disposable income affects the demand of Rolls-Royce vehicles. More disposable income would increase demand while lower disposable income would decrease demand for Rolls-Royce cars.
There are three main companies producing high-end luxury vehicles they are; Rolls-Royce, Bentley and Maybach. Rolls-Royce competes in the oligopolistic global industry. The industry is capital intensive and there is a requirement for high investment in advanced technology and research and development. This makes it difficult for newcomers as they require a large amount of financial capital to invest in production factories and research.
Customer Analysis
Roll Royce phantom customers seek high quality, luxury vehicles that are readily available. It was noted that Rolls Royse phantom strives to ensure that the products offered satisfy the needs of customers. Rolls Royce phantom makes certain that it listens to the needs of its customers and that it responds to their claims. It also ensures that required products are presented to customers at the right time when needed, and they are never out of season (Zonis, 5). Rolls-Royce vehicles are known to be relatively quiet despite a 6.6-liter twin-turbo V12 engine with 563 horsepower. The Rolls-Royce Phantom can go 0-62 mph in less than 4.7 seconds. The vehicle also has a top speed of 155 mph (Simona 2012). According to the management of Rolls Royce phantom, customers in the company can be segmented by knowing their needs, and knowing the products that they prefer. The company observes how their customers react to some of their products, and how well they welcome a new product that the company introduces to the market. The company offers a variety of products which examines the response from customers. Customers can be given products based on their age, their geographic region, race and other demographics. An attempt to find out the key segments of the market in Rolls Royce phantom stipulated that, the major segments of the market can include location, whereby where customers are located may be extremely vital. Rolls Royce phantom recognizes the need to know how its products will reach its customers, and how easy customers can get access to their products (Cant and Strydom, 105). For example Rolls-Royce can observe customer lifestyle and tastes in the Asian market and alter vehicles to meet those custom needs. Rolls Royce phantom ensures that its products are readily available to its consumers, which helps it stay at the apex of competition with its competitor companies (How to Segment Customers). Behavioural segmentation looks at how customers relate to a certain product, and how the product is perceived. Roll Royce phantom looks at how loyal customers are to a product they produce, and also; the availability of such product in the market. Looking at the rate of consumption of the product is also a strategy used by the company to identify how individuals relate with the product. Psychographic segmentation categorizes consumers according to how they live, their interests, and economic activities that such individuals perform. Roll Royce has a tradition of conducting surveys of the target people, to know their interests, opinions, and attitudes towards a product and with this; the company is able to know how to approach the target area. Most Rolls-Royce buyers are Roll Royce uses geographical segmentation to base its products according to where its customers live. The company looks at regions, provinces or cities where it can launch its products, and it looks at how best such a product can perform in the region. Rolls-Royce buyers are generally from one of two groups. The first group comprises of old money buyers that want a vehicle that can be passed down for generations. Or the new money buyer which seeks instant recognition from society. Most buyers are self-employed, heirs to large fortunes. They have three to five homes and a net worth over 30 million in most cases (Marbury 2008). Rolls-Royce customers can be influenced easily by society and pop-culture. If they see other members of a high society purchasing a Rolls-Royce, then they too will want to purchase one. Many Rolls-Royce buyers want to display their high status in society for which reason they purchase a Rolls-Royce.
Competitor analysis
Some SWOT Analysis Please Use it its useful I found it on web and is linked to most of our stuff
This will make it really easy for you
http://www.mbaskool.com/brandguide/automobiles/4328-rolls-royce-motors.html
Strength
1. Technological support from the parent company
2. Strong brand image globally existing since inception
3. Strong aspirational value in minds of people
4. Superior build quality not only for interiors but also the exterior, engine & chassis
5. It has elegant and supreme brands like Phantom, Phantom Drophead Coupé (convertible), Phantom Coupé (coupe) and Ghost
6. The brand is owned by the elite of the world, and is one of the most significant status symbols of the super rich
7. Rolls-Royce has customers in over 150 countries and operates in more than 50 countries worldwide
Weakness
1. The design of its models is evolutionary in nature thus they look similar
2. Many potential customers move to other brands due to the profiling requirements
Opportunity
1. Currently there is a rising trend for environmental friendly cars, there lies an opportunity for luxury brands as well
2. Also keeping the price premium they should try & relax the customer profiling procedure
Threats
1. The protectionists trade policies of various countries
2. Unwillingness of people to buy a vehicle of such high price
