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Land Rover North America. Study Case
Transcript of Land Rover North America. Study Case
Market Environment at the time of the decision: Consumer behavior
Increasing SUV purchase interest -> consumers considering:
4.overall comfort and aesthetics
Majority of SUV-s included 2WD, not 4WD
The most important reason for choosing SUV was four wheel driving ability
Market Environment at the time of the decision: Competition
>30 SUV models present on the market
Price range $10,000- $60,000
Modest market share of Japanese models
Growing competition for market share within luxury segment
Market Environment at the time of the decision: Land Rover position in the market
Steady increase of market share since the implementation of diversification strategy
Three models presented in the market:
Why to launch a new product?
Discovered the opportunity to increase market share in the niche of luxury SUVs
Need to follow latest technological
umer trends due to intense rivalry
Need to keep US consumer in mind
Increase sales in order to reach a goal of 40,000 units sold
Become leader in SUV Market in North America
After introducing a new model LRNA doubled its volume of sales from 1993 to the first half of 1994 up to 4.503 units
Range Rover (1986)
Land Rover Discovery (1992)
Land Rover Defender(1980)
Typical SUV consumer
Main purchase drivers:
Men as well as women (66% men, 34% women)
Median age – 43
Married and educated
Average income is around $63,000
Need SUV mostly for transportation to/from work and daily errands
Off-road capability (4WD preference)
Aesthetics and comfort
How consumer behavior is changing?
Young families without children are interested in SUV models
Consumer is influenced not by status of wealth and prestige, but by new experiences in terms of driving a car
Consumers are becoming more pragmatic
Clearer perception regarding salient attributes of different brands
Vehicle should be fun and pleasant to drive
What should LR’s overall segmentation strategy be?
In order to increase market penetration, Land Rover should target several groups of potential customers and develop products according to target groups’ profiles
Important: make sure that overall mission of the company is consistent with segmentation strategy
- Middle-aged men
- Adventure seekers
Concentrated on off-road driving experience
- Men and women, young families
- Middle income -> price sensitive
- Concentrated on safety and functionality
- Men and women
- High income
- Not price sensitive
- Concentrated on performance quality and safety + touch of luxury
What market Land Rover should target?
What type of positioning strategy should
Land Rover use?
Focus on the attributes - Land Rover is the best SUV on the market
What should be Land Rover’s positioning strategy?
4x4 Luxury CAR
Highest possible technological innovation
Comfortable and Convinient
Brand positioning Strategy
Raise brand awareness
Establish Land rover Brand Image in U.S. costumer mind