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Fiat 500

Product Analysis
by

Ashley Dyckman

on 7 August 2013

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Transcript of Fiat 500

Fiat 500
Introduction
Fiat-Fabrica Italiana Automobil Torino
The original Fiat 500 was produced between 1957 and 1975
The new Fiat 500 was relaunched on the company's 50th anniversary in 2007
The car debuted in North America in 2010
Marketing Objectives
In 2010 Fiat aimed to sell 6,000 units every month and 72,000 annually
They sold only 19,769
In 2011 Fiat lowered it's goal to 50,000 units annually
They sold around 57,000
In 2012 their goal was to sell between 25,000 and 35,000 units
They sold 28,566 in the first 8 months
S.W.O.T. Analysis
Target Market
Timothy Kuniski, President of Fiat USA said, “There really is no hard and fast demographic. (It’s) more of a psychographic. When you’ve got that small segment, you want to bring in people from the other segments. And you’ve got to give them as many possible slices as possible. By the end of this year, we’ll have nine different variations of this segment.”
BCG Growth-Market Share Matrix
By Ashley Dyckman and Paco Hernandez
Why?
Oliver Francois, chief marketing officer and global chief of the Fiat brand said, "There is now no excuse, the brand's brief was wrong, and all the responsibility lies here. Soon we will have the sporty masculine version [the Abarth] that we missed because we were tucked into the feminine DNA of the 500."
Feminine v. Masculine Marketing
Marketing Mix
Growth Strategy
Fiat has a low share of the subcompact market, about 11%

Subcompacts account for 4% of the auto market
But Fiat has potential for growth due to rising gas prices and and increasing amount of people looking for economical cars.
Between 2012 and 2013 subcompacts deliveries rose by 37.7%

23.6% of subcompact owners traded their cars in for another subcompact
Fiat does not yet have the reputation of the BMW Mini Cooper or Volkswagen Beetle, but it has potential to become a star because of the high-growth industry.
Promotion Strategy
Television Commercials
YouTube Channel
Website and Social Media
Newspaper Ads
Product Strategy
Inexpensive compared to the Mini and Beetle
Technologically innovative in the base model
Economical
Eco-Friendly
Distribution Strategy
Build your own Fiat 500 online
Around 170 dealerships nationwide
Pricing Strategy
Pop
$16,100
Sport
$17,500
Lounge
$18,500
Abarth
$19,500
Market Development

* New distribution channels (e.g. moving from selling via retail to selling using e-commerce and mail order)

* Different pricing policies to attract different customers or create new market segments

Product Development
Market Penetration
* Vehicles that are gas savers, but also are large for a family

Example: SUV or Mini vans ) (Panda, BUT has only made it to Europe and South America.

Diversification
* Extended Warranty , Ex: adding years and exting the millage
* Free oil changes (Untill paid in full)
* Car washes / Details
(Appealing

Strengths
Weaknesses
Opportunities
Threats
Fiat merged with Chrysler LLC.
They now share platforms and powertrain technology
Chrysler will assist Fiat with product development
Stylish looks and 500 options to choose from
4 star overall safety rating
Heritage brand's history of being the first auto maker to provide mass motorization to Italians
Small size-comfortably fits 2 adults and 2 children
Less MPGs than it's subcompact competitors
Feminine appearance
Fiat's last U.S. run in the 70s and 80s gave the brand a reputation for unreliability and the coinage "Fix it again Tony"
Rising gas prices have people looking for more economical cars
23.6% of subcompact owners traded their cars for another subcompact
Low profit margins and high operational costs
Large amount of rivalry subcompacts being made
Chrysler has had a history of recalls, issuing 6 this year alone
Psychographic
Those looking for good gas mileage
People who do not need to haul things or people
*Develop more colors for the interior Design, rather than two.

*hybrid-electric models avaialble in all 50 states.
References
Ebhardt, T. . Retrieved from http://www.businessweek.com/articles/2012-03-08/fiat-tries-again-in-the-u-dot-s-dot

Felipe, J. (2012, April 17). Fiat brand sales 2012 full analysis. Retrieved from http://fiatgroupworld.com/2013/04/17/fiat-brand-sales-2012-full-year-analysis/

Fiat 500 safety. (2013). Retrieved from http://usnews.rankingsandreviews.com/cars-trucks/FIAT_500/Safety/

Gluckman, D. (n.d.). Retrieved from http://www.caranddriver.com/news/fiat-and-chrysler-announce-strategic-alliance-car-news

Healey, T. (2011, 03 02). Fiat brings new sales strategies to american market. Retrieved from http://automotive.about.com/od/Retail-Marketing/a/Fiat-Brings-New-Sales-Strategies-To-American-Market.htm

Huealey, J. (2013, 04 09). 6 chrysler recalls: airbag lights, brakes, fuel tubes. Retrieved from http://www.usatoday.com/story/money/cars/2013/04/09/chrysler-300-dodge-charger-challenger-recall-airbag/2067947/

Isodoire, C. (2012, 01 09). Sergio marchionne: Fiat 500 sales goal 'incredibly naive' . Retrieved from http://money.cnn.com/2012/01/09/autos/sergio_marchionne_fiat_500/index.htm

Kreindler, D. (n.d.). Retrieved from http://www.autoguide.com/auto-news/2011/09/fiat-500-sales-missing-targets-chrysler-blaming-marketing-strategy.html

Krisher , T. (2009, 06 11). Problems of old chrysler linger at 'new' chrysler, us. Retrieved from http://www.theguardian.com/world/feedarticle/8553034

Snavely, B. (2012, 03 23). At last, fiat gaining a foothold in u.s. car market. Retrieved from http://content.usatoday.com/communities/driveon/post/2012/03/at-last-fiat-gaining-a-foothold-in-us-car-market/1

Vandezande, L. (n.d.). Retrieved from http://www.autoguide.com/auto-news/2012/03/sub-compact-and-compact-sales-grow-in-us.html

Williams, S. (n.d.). Retrieved from http://adage.com/article/news/chrysler-fiat-chief-olivier-francois-talks-fiat-super-bowl/232011/
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