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This coursework entitled "Marketing" is about creating a marketing strategy for a new or existing product. The product I have chosen to do is the new Audi A6.

Extracts from this document...

Introduction

AVCE Business Studies Unit 3 - Marketing CONTENTS Contents 1 Introduction 2 Information gathering 4 Introduction to marketing 5 Market research 8 Analysis of current marketing strategies 14 External influences 16 Marketing planning and auditing 21 Developing a marketing strategy 25 Marketing mix 35 Summary of marketing strategy 48 Bibliography 50 INTRODUCTION This coursework entitled "Marketing" is about creating a marketing strategy for a new or existing product. The product I have chosen to do is the new Audi A6, the latest model of car to be made available for order in the UK in April 2004 for delivery on the 12th of June which is set to sell from �24,175 to �42,775 (including VAT). Audi history The Audi badge - the 'Four Rings' - is the emblem of one of the oldest car manufacturers in Germany. It symbolises the 1932 merger of the four independent motor-vehicle manufacturers: Audi, DKW, Horch and Wanderer. Together with the NSU brand, which joined in 1969, these companies are the roots of the present-day AUDI AG. The Audi Company currently have a reputation for producing high quality, long lasting cars. Their slogan is "Vorsprung durch Technik" which means "Progress through technology". They made net profit of �816 million in 2003, �5.4 million more than in 2002. Audi UK Audi UK is the most successful Audi importer in Europe and its consistently increasing sales reflect this. Having increased sales each year since 1999, the brand broke through the 65,000 sales barrier in 2002 and sold 70,107 in 2003. Their market share in this year was 2.7%, a 0.6% increase on the previous year. Audi UK has been operating as a separate company in the United Kingdom for over 10 years, following wholesale separation from the Volkswagen brand in 1993, although remains part of the Volkswagen Group based at its headquarters in Buckinghamshire. There are currently 131 Audi Centres in the country. ...read more.

Middle

2. Introduction - sales start slow. Some distributors may be reluctant to take on an unproven product. (This will not affect the A6 as Audi have their own showrooms.) Heavy promotion is necessary, the product is high risk and the firm cannot take advantage of economies of scale. This stage will be short for the A6 as customers can order it before long release and it is a proven product (the old A6) so people will not be put off buying it. 3. Growth - sales begin to grow rapidly. Cost per unit falling due to economies of scale. Profits usually made. 4. Maturity - sales growth is slower. Promotion often tries to differentiate to gain new customers. Brand loyalty is important here. 5. Decline - sales decline. Profits fall and subsidiaries appear. The product is often withdrawn from the production line. Decline in sales of the old A6 may have been the reason for Audi releasing a new one. The main point of the product life cycle model is to highlight the typical stages of a products life so allowing the company to prepare for the future and adjust its marketing strategy. The A6 is currently in the introductory phase. At this stage the marketing objective is likely to be to attract new customers and promotion is informative. There stage of the model can be very costly for a company. There must be heavy spending on promotion to make consumers aware of the product. A range of form should be used, including heavy advertising. The pricing method also needs to be carefully considered. In this type of market, a differentiated mass market which is growing quickly, they can set a high price as this is unlikely to deter consumers. However, if the price is set too high, it will price the A6 out of the market meaning it will not be competitive and so will fail. ...read more.

Conclusion

and psychological pricing (this price is neither too much nor too little). Premium pricing is used due to the reputable brand name, particularly in the current good economic climate (higher income, A6 is income elastic). The product should aim for differentiation through the brand name Audi and features, including new engines and the latest in-car technology, which add value. Audi have always aimed for product differentiation rather than cost management so this should be continued. It can be done through a reputable brand name and a high quality product with many additional features. Differentiation is likely to lead to increased market share and so increased turnover and profit. Distribution of the product should be limited to exclusive Audi dealerships and website. Exclusive distribution is associated with high quality, high priced speciality goods such as the A6. This maintains this image. The website will provide an extra market for sales and targets for this should be set. Audi should use zero level distribution. Zero level distribution cuts out the middle man so reduces costs and helps exclusive distribution. The A6 should be advertised frequently and in a wide range of places, mostly television, billboards, magazines and radio. The firm has great financial resources at their disposal so can afford a large advertising budget (found from last years spending in annual report). Advertising in this way will ensure people, particularly the target audience, here about and know the benefits of the product. Other forms of promotion, including personal selling, are to be done less. The A6 is a consumer good so advertising to the final consumer is most important. Personal selling is not as important as this is used to sell products to retailers. However, Audi do need to use personal selling in their showrooms to persuade perspective customers. All elements of the marketing strategy and marketing mix compliment each other so they work together effectively to achieve the marketing objectives. ...read more.

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