For GM’s product Chevrolet Corvette, many agents in the microenvironment play a role. First agent to consider is of course the customer itself. In every marketing strategy, the main focus should be the customer of the product and every step taken should revolve around it. The customer for corvette consists of young, high income people with a lifestyle that suits the high power, sporty image of the car itself. It’s very important to note for the marketers that the customers buying patterns and habits are changing in today’s world where unemployment rates are higher than ever, gasoline prices are increasing and factors like global warming are causing the world to focus more towards hybrid and more fuel efficient cars.
This brings us to corvettes competitors. Customers, even the most loyal ones, are developing a liking and addiction for foreign brands such as Toyota, Honda, BMW, etc. All foreign brands offer superior quality and better fuel consumption in their product lines compared to GM’s gas guzzling cars especially the Corvette. Customers are switching to the Japanese models for higher durability and reliability.
Corvette has been an icon for the Americans for many decades. But GM’s year after year of poor quality cars as compared to its foreign competitors have deteriorated GM’s image. All these factors in corvette’s micro environment need careful consideration to develop the right marketing strategy for corvette if its sales are to be grown.
Corvette’s customers mainly fall into the Generation X and Generation Y categories. The behavior and attitudes of these customers need to be studied carefully.
One of the biggest problems in today’s environment is the global economic crisis. Corvette is a brand that is positioned to meet the needs of customers with a high income profile and who have a passion for high end sports cars. In today’s environment however, the population has lesser buying power and hence their spending patterns are changing. Oil prices have been increasing causing it to be even more difficult for Corvette to be accepted.
GM’s Current Corvette Marketing Strategy
General Motors is currently fully under the effect of the global economic crisis and has announced a $200 million cut in their marketing budget. With costs of production on the rise, gas prices increasing, sky rocketing car finance rates, competition from the much more efficient Japanese brands such as Toyota and Nissan and finally, the environmental concerns, the market for American automobiles is on the decline. As far as the corvette is concerned, the car is totally out of line with GM’s current car manufacturing strategy of smaller more fuel efficient cars like the Chevrolet Beat and the hybrid Volt concepts. Recently GM decided to scrap its HPVO (High Performance Vehicle Operations) and all high performance car projects have been put on hold indefinitely. Since Corvette is a GM icon, both top-line corvettes (The ZR1 and Z06) were two of the three V8 cars that are ‘safe’ from the scrap move. GM’s current strategy for the Corvette is targeted towards sports car enthusiasts. The new ZR1 Corvette is the best one so far with performance close to Ferrari’s and Lamborghini’s flagship models. For Corvette enthusiasts, the ZR1 is a must, despite it being the first Corvette to have a six-figure price. But GM wants to move into newer markets; the high-end exotic buyers that have a taste for Italian exotic sports cars such as Ferraris. With the Current economic crisis, even companies like Ferrari have suffered and GM boasts its new ZR1 as a car that gives ‘Ferrari performance’ at the price of a Chevrolet, which is a base price of $103,970. Pretty impressive for a car that gives out 638 bhp and lapped the Nurburgring in 7:26.4. Another advantage that GM highlights is the fuel consumption which is also better than most cars in this category. Therefore, because of the big budget cut and the supercar status of the new Corvette, the current strategy seems the only option that GM can see.
What should the Corvette Marketing strategy be?
Considering the global economic crisis, GM’s marketing budget cut and the deviated preferences of buyers; GM needs a marketing strategy to revive the Corvette by highlighting its advantages over its competitors and by portraying it as a true affordable supercar.
The Corvette’s target segments are multiple. First they need to appeal to the die-hard Generation-X Corvette/super car enthusiasts. These people are from a time when the Corvettes were a statement and GM will not have to pitch the brand to them aggressively to persuade them. Second, GM needs to target the younger Generation-Y and millennium generation market with its fierce positioning strategy discussed in the following section.
For the older supercar enthusiasts, GM needs to adopt a more ‘retro’ approach highlighting the corvette’s legacy and how the car has evolved into a supercar over the years. The key is to highlight the similarities of the new Corvette with the classic Corvettes, identifying the improvements but with a nod to the classic Corvette.
For the younger generation, smarter to distinguish efficiency and performance factors, GM needs to position the Corvette in the customers’ minds by highlighting Corvette’s edge over its competitors; in the supercar market, the Corvette is an affordable catch. Cars with similar performance levels start from $200,000 and go up to $1 million. The top of the line ZR1 has a base price of $104,000. Second, GM needs to highlight the technical developments the company has been doing in order to improve performance and compete with international brands. GM is now testing their cars for handling on the Nurburgring, alien to the Americans until recent times. The Corvette has performed impressively on these tracks and highlighting these will gain the respect of young customers.
GM needs to market the Corvette by placing it right. The trend has moved from TV commercials to the internet and movies. The movie Transformers has been an extremely successful outlet for GM and has been a key factor in the success of their new Camaro. A similar strategy for Corvette will not only target newer, younger more enthusiastic markets, but also reach a wider audience.
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