Where as in India, the Automobile Regulatory Board runs the manufactures according to their norms. These boards emphasize more on protecting the environment by controlling the pollution by ticketing the drivers using adulterated fuel in their vehicles. It has also been seen against the use of cooking LPG in the cars. As high duty is imposed on imported cars the manufactures hesitate to introduce the better models into the Indian market. High tax imposed on the import of the cars which will lead to the increase in its price in the domestic market.
(www.epa.gov)
(http://www.ford.com/doc/2006-07_sustainability_report_web.pdf)
Economic Environment
Ford's economic environment in US is doing quite well. As US is a developed nation, their GDP and per-capita incomes are high. So the manufactures can decide their product class. This is quite impressive considering that the number one automotive company, General Motors, an American company has 29.4% of total market share. This means that the top two companies hold more than 50% of the market share. This is quite extra ordinary. The Total market value of the Ford Motor Company is approximately $56 Billion dollars and their profits are well over $7 billion.
In the recent years, the purchasing power of Indian consumers has increased rapidly due to the economic growth; Ford is targeting to set their market in India as India is a developing economy as it is growing at a rate of 10% per annum. Ford Motor Co plans to invest $500 million in India to double manufacturing capacity by 2010.
(International Business Times)
(http://in.ibtimes.com/articles/20080108/tata-motors-ford-jaguar-land-rover.htm)
Socio-Cultural Environment
In US, Ford Motor Company sponsors many programs to better the community and their safety. For example in the Detroit area Ford organized a weekend clinic in which the automotive safety office educated fifty-five people and their children on proper use and installation of child safety seats. They demonstrated this in the consumer's actual vehicles. Ford also is committed to environmental cleanliness. They sponsor programs to educate our children on environmental cleanliness and responsibility. They also sponsor companywide recycling, cleaner operating vehicles, recyclable components, cleaner manufacturing, and employee involvement in environmental activities. The Ford Motor Company not only is socially active, but culturally as well. Ford provides financial support at many historically black colleges such as the Tuskegee University in Alabama.
In India, Ford Motor Company is committed to equality of opportunity, fairness, work life balance, respect and dignity at work for all. Ford values differences of culture, ethnicity, race, gender, nationality, age, religion, disability, marital status, sexual orientation, education, life experiences, opinions and beliefs. Diversity adds a clear value to Ford's employees, business, customers, the company, shareholders and the communities in which Ford operates. Ford believes valuing difference is not just a 'good cause' - it is a business imperative.
Technological Environment
In Us, Ford has placed more than 5 million vehicles in service capable of running on renewably produced ethanol fuel. They are promoting the development of infrastructure in North America and Europe that will expand the use of these bio-fuels and help reduce our dependence on oil. We have built 4 million vehicles globally with electronic stability control systems. More than 1 million of those vehicles feature Ford’s industry-exclusive Advance Track with Roll Stability Control.
While in India, New safety features have helped drivers avoid collisions through technologies like lane departure warnings and assisted braking. Technologies in development also include the Escape Hybrid E85 applied in Ford Endeavour, which combines hybrid technology with Flexi fuel capability. This fleet joins test fleets of vehicles that run on hydrogen fuel cells and hydrogen internal-combustion engines.
(Isobel Doole and Robin Lowe, 2004)
Marketing Mix
Product Mix
In USA, the Ford Motor Company has such a wide selection of vehicles in order to satisfy every different type of potential consumer. They offer small cars, sports car, midsize cars, luxury cars, vehicles, convertibles, wagons, minivans, vans, SUVs, trucks, commercial trucks, and even environmentally efficient cars. Each of Ford’s different types of vehicles has many different options that come along with them. The 2001 Explorer for example, runs roughly $25,715 dollars, without any extras. However, should the consumer decide that he or she would like to add perks, there would be many choices. In India as well as in US, the customers are provided with the freedom to customize the engine, transmission, drive, rear axle, wheel type, tire type, seat type, seat equipment and much more. The company also offers the vehicles in different colors for the exterior. Ford targets towards different age groups, personalities, gender, economic standing and more. In US, product line stretching is adopted, which is increasing the product line by lengthening it beyond its current range. For example, Ford introduced small, lower- priced model Ford focus starting at $14,300. Focus is the innovative brand for the sub-A segment in the Ford group. Similarly in India, product line filling is adopted which means increasing the product line by adding more items within the present range of the line.
For example, Ford introduced Fiesta with its own different versions within its present line.
Services Offered
When you own a Ford vehicle, you can register for Owner’s Services. This includes reminders of when your vehicle need to be serviced, tips for vehicle safety, maintenance information. Further Services that are offered by Ford Motor Company in USA and in India are Customer Assistance Centers, Collision Assistance, Roadside Assistance, Technical Service Information and their web site.
Pricing strategy in India and United States
In US when Ford was first introduced, they were the monopoly sellers so they followed Price- skimming strategy. And with the emerging competitors into the market in the past decades they had to bring the price down in-order to compete in the market. Whereas in India, when Ford entered the market with its Ford Escort in 1998, there were competitors, so they had to enter the market with the Market Pricing strategy. In India, as there are only assembling parts in India, the parts have to be imported from other parts of the world which has a value for cross border taxation purposes. So this is the cause for the increase in the price of car in India when compared to other parts of the world.
Another of Ford’ pricing strategies is the fact that they try to help the consumer finance a Ford vehicle. Ford offers its consumers many plans to choose from in order to find the financing option that best fits their needs. Some of the financing options provided are Red Carpet Lease, Mobility Financing etc.
Distribution
Distribution involves activities that make products available to customers when and where they want to purchase them. It is sometimes referred to as the PLACE element in the marketing mix of “P’s”. The distribution starts from the manufacturer and ends with the ultimate customer. This process includes further sub-processes like assembling and the supplier. The product is first manufactured in the warehouses. This product is transferred to the authorized dealers and finally supplied to the customers. In USA the manufacturing and assembling is performed in the same plant, then transferred to dealers and then to their customers, whereas in India as there are no manufacturing plants, the parts are imported from other part of the world which are later assembled in two of its assembling plants- Delhi and Chennai, from where it is transferred the customers through authorized dealers all over the country. In US, the US department of commerce or its equivalent in other countries helps to find a good distributor. The Local Chamber of Commerce in a country can also provide lists, as can local trade associations. They also follows JITS (Just-In-Time), by which customers are able to order their choices from the suppliers and getting them delivered it on time in the right condition avoiding holding cost altogether. Ford’s newest web site for division cars and trucks is www.Fordvehicles.com. The new web site allows perspective customers to compare Ford vehicles to other cars made by other manufacturers. They are the first company to give consumers the option of product comparison. The section of product comparison on the web site comes complete with photographs, feature description, safety options, competitive pricing, financing and warranty information.
(Warren.J.Keegan, 1995)
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Promotional Strategy
The current promotions that are offered by the Ford Motor Company are Radiator Service, Brake Service, and Batteries. All of the above promotions are wonderful for the winter months. The radiator service includes, top of all fluids and a free 12 pt all weather check of hoses, clamps, belts and more. All of the above promotions appeal to people who are thinking ahead to the cold winter months. This winter in New York, USA has been predicted to be one of the worst. The battery promotion comes with over an 82-month warranty. The Brake promotion comes with Motor craft brake service. The promotion includes replacement of brake pads or shoes, front or rear turn rotators and drums. In India, with varied climate throughout the country, especially the states like Tamil nadu, Rajasthan, Delhi (in summer) etc where the climate is hot, Ford provides aluminum chase extra cooling engines. The other promotions include club cards to vehicle owners, foreign trip vouchers, free services, finance etc.
Radio is one of the most widely used media for advertising, and is exploring it to a great extent. Radio does constitute a major part of its advertising. It recently launched the’‘5 minutes mein Fida’ [campaign was all about how one needs just five minutes to witness Fiesta’s excellence in performance, and thereby fall in love with the car.] campaign on the radio, as well as on television.
Ford undertakes a lot of below-the-line activities. The Vodafone Delhi Half Marathon was ‘Driven by Ford’ –we were the transport partners for the event, with the New Endeavour and Fiesta as the lead cars of the marathon. They also do a lot of events with our customers. They also recently conducted a ‘Ford Treasure Hunt Drive’ for our existing customers in Ahmadabad, and a contest ‘HT War in Windies’ in collaboration with Hindustan Times. The contest winners, one each from Delhi and Mumbai, won Fiestas as the grand prize.
Evaluation and suggestion
In the fast growing market for the automobile industries in developing country like India, The Ford has achieved a satisfactory level of success and is planning to invest $500 million in the Indian market. Even though there had been a loss in sale in the previous year in the US market, Ford has managed to cover that loss by covering it in the Asian markets. Ford India posted a 45 per cent fiscal growth for the period April 2006-March 2007.
The sale can be increased by the cost-cut-down policy i.e. cutting down price in order to attract more customers and thereby increasing the volume of sale. The sale volume can be also increased by applying value-for-money schemes i.e. providing benefits of higher version cars in the lower ones.
For example: - providing spoilers or sunroof or music system as in the higher models to the lower ones without an increase in price. The dealers can be appreciated to achieve sales target by offering more commission or allowances.
Conclusion
The Ford Motor Company has come a very long way, since it was first established by Henry Ford. They went from a little wagon shop to the second leader in automotive sales. They have been around for almost a century. I firmly believe that with Ford’s experience and high understanding of, and ambition for the satisfaction of the customer, that they may one day be the number one automotive company, beating out the General Motors Corporation. Ford base their communication on consumer driven insights to enable a stronger connects with the consumers, and to ensure the communication resonates with the target customer.
Bibliography
Books
-
Doole et al., (2004), “International marketing stratergy”, Thomas Business Press, London.
- Kotler et al., (2007), “Principles of Marketing”, Prentice Hall, India
- Warren.J.Keegan, (1995), “Global Marketing”, Prentice Hall, USA
Website
- International Business Times, India- Tuesday 22nd January 2008, http://in.ibtimes.com/articles/20080108/tata-motors-ford-jaguar-land-rover.htm
- http://www.exchange4media.com/Brandspeak/brandspeak.asp?brand_id=104
- http://www.ford.com/doc/2006-07_sustainability_report_web.pdf
