Chapter 7 Business Marketing

Since 2008, Audi’s marketing objectives have been to increase brand awareness and sales in a down economy, taking advantage of the fact that most marketers cut back on marketing during a recession. To do this, Audi has used several “unorthodox” viral marketing campaigns worldwide. These include the “Stolen Audi” miniseries TV and YouTube video spots and “Meet the Beckers” videos aimed at Audi’s competition. Both campaigns were instant hits online and offline. Viral marketing works for Audi because it is perceived to be “unorthodox” which matches Audi’s brand position in the marketplace. The viral marketing campaigns have succeeded to slow declining market share compared to other car brands in the current recession and have actually increased Audi’s brand awareness over its competition.

As the advertising world is changing, more and more businesses are making use of viral marketing strategies to enhance their online presence since these are efficient, and cost-effective tactics. Viral marketing is a free, word-of-mouth advertising technique to increase your brand awareness online and offline by getting people to talk about your products and services, perfect for Facebook, Twitter, YouTube, blogs and other popular social media sites.

Chapter 8 Segmenting and Targeting Markets

To segment a market you begin by defining the market as a whole. The market as a whole, for Audi, is any person with a driver's license. The next step is to examine the four bases of segmentation (geographic, demographic, psychographic, and behavioural) and decide which, and how they are  relevant to the particular product. Audi mainly utilizes Geographic, Demographic, and Psychographic Segmentation.

 

Geographic segmentation
Is geographic segmentation relevant to car buyers? Yes. The first decision Audi's marketers would make is which cars to market in which countries. Europeans, for example, drive much smaller cars than Canadians. Within a country like India, Audi might also segment the market into rural and urban areas. People who live in rural areas are more likely to buy a Audi A3 than a Audi A7.

Demographic segmentation
What about demographic segmentation? Demographics is a general term for any measurable information about consumers that allows marketers to group them into segments. Age is a relevant demographic for car buyers. The very young and the very old do not drive, and in between, say, from ages 20-70, the choice of car will be partly influenced by the person's age. Take the Audi A6, for example. A 20 year old is more likely to choose this car than a 70 year old because it is more flashy. There's more to demographics than simply age, though, such as segmentation by gender. Are women more likely to buy certain Audi models than men? Are men more likely to buy certain Audi models than women? There's also segmentation by income. A person's income level is a major influence on their choice of car. A young man just starting his career, or an older man working in a low-paying job, might desire an Acura NSX, but at $89,000 U.S., neither could afford to buy it. Family status, whether a person is married and whether they have children, is also a demographic factor that influences their choice of car.

 

Psychographic Segmentation

Psychographic segmentation is dividing the buyers in the market into groups based on social class, lifestyle, or personality characteristics. These variables heavily influence purchase making decisions. When it comes to social class, Audi aims for Upper Middle Class to High class people, because it is a luxury brand. Peoples interest in various products can be determined by their lifestyles, and indeed people can often express their lifestyles through the goods that they consume like cars. Psychographic segmentation has demonstrated its use as a practical marketing tool in consumer markets.

 

 

 

 

 

 

Chapter 11 Developing and Managing Products

Audi of America attributes innovation in marketing and technology as its main revenue drivers, pushing its year-over-year sales up 20 percent. The brand’s January sales recorded 7,812 Audi cars and SUVs sold in the United States. This tops the charts as the best January in Audi history.Affluent consumers are continuing to be drawn towards and respond favorably to the most technologically advanced vehicle Audi has ever produced: the Audi A8. When the 2011 A8 flagship model was introduced in November, sales jumped 765 percent from a year earlier. Consumers also continued to demand the Audi A3 TDI clean diesel model, as sales climbed to almost 53 percent from a year earlier. This model won the 2010 Green Car of the Year award. Audi’s strong social media and digital tactics were leading factors in its sales records. The German automaker consistently posts recent news on its Facebook, Twitter and Web site. It also promotes its latest vehicles on the brand’s YouTube channel.

Audi also flaunts its newest vehicle via an iPad application. The automaker recently announced its plans to go green with the launch of providing auto show attendees access to digital brochures. Audi of America reshaped its business model to bolster its dealership partners and to get away from buying sales with unsustainable discounting. Audi is continuing to build consumer awareness and consideration, while building off interest in our newest models.This spring brought the all new Audi A7 4-door executive coupe – putting Audi into a new luxury segment.

Chapter 16 Intergrated Marketing Communications

When it comes to promotional strategy, Audi does it all from advertising to personal selling and public relations. These  promotional strategys go hand in hand.   First off, Audi creates advertisements on TV,  billboards, magazines, etc.Audi's broadcast and online video placements centered heavily on major sports events, which meant Audi outspent BMW on network television. Audi launched its "Green Police" commercial in this year's Super Bowl. This gave Audi alot of "Buzz" and it gained more than 2.2 million views to date on YouTube. Another way Audi put their name out there was by taking a big position on Yahoo during the FIFA World Cup. Audi was the exclusive sponsor for Yahoo's coverage of the entire month long sporting event. Both ran schedules on endemic automotive sites such as Edmunds.com, AutoWeek, Auto Trends, Car and Driver and AutoTrader. Through these advertisements and sponserships, they are able to advertise new features and prices. All these strategies eventually lead you to a dealership.

This is where personal selling comes in. They obviously would like to sell you a car but they understand how big of an investment a $100,000 car is. Therefore they take the time to get you the right car that fit your needs and budget. In terms of PR, the agency that wins the Audi PR business won't have to worry about turning around sluggish sales. In 2011, Audi said it expected its 2012 vehicle sales to hit 1.3 million -- a record with growth in most global markets, according to Automotive News. Also, for the month of October the Volkswagen brand -- which was named to Ad Age' Marketer- A- List this week -- posted the industry's highest sales growth in the U.S., up 40%.

Chapter 10 Product Concepts

An Audi product can be put into two categories . The first type of product it can be referred to as is a shopping product. It is more expensive than a convience product but also because it is a product that cnsumers will invest in. It fits their lifestyle compatibility, and desired benefits. It would be a heterogeneous shopping product, because the prices, quality, and, features (of cars) vary so much. This could be said for someone that is considering buying a Audi and might compare it to Honda, but to even compare a Audi to a Honda would be blasphemy.  It is also a specialty product because it is an expensive luxury car company and doesn't have as many stores as a convenience product does. A consumer will look to find a luxury model Audi and will not substitue a Audi with a Honda if their main priority is a luxury high end car.

With the way Audi has been marketed and branded consumers have this concept of an Audi car being a specialty product because of its price range and luxurious, prestigious look. Those who have an Audi A6 , S8 or any Audi model for that matter are very reluctant to accept substitutes to fill in for an Audi, which definitely has an exclusive image. Audi is "quality, luxurious, and truth in engineering" as informed by their commericals and spokesman. An Audi dealership helps create this image because they have this boutique, prestige feel as any exclusive product would. This is where Audi has achieved greatness and is the envy of many marketing professionals. Although some Audi models such as the A8 or S8 are more expensive and have this very stylish, elegant, and upscale feel, some of their other models such as the A6, or A4 are reachable and accessible to what one might call the "average" person who just might be looking for a lower end model. The models that have helped launch the brand into this status have definitely been the A8, S8, R8, A7 and S7 and TT RS which are all their top line models.
Audi's product mix consists of 33 automobiles. Within these 33, there are 5 different categories (The A line, S line, Q line, TT line, and R line), which we call the product mix width. Even within that, there is the product line depth, which are the different models under each line. With such a variety of cars, consumers have many options to choose from and which one of these models best suits their needs and desires.

Chapter 18 Sales Promotion and Personal Selling

Marketing managers can use sales promotions to increase the effectiveness of their promotional efforts and to offer incentives to buy. In terms of sales promotion, Audi doesnt  promote itself as much as other car companies (such as Toyota, Honda, and Nissan etc) when it comes to sale promotions and deal offers that happen at the dealership level. The reason for this is because Audi has already established itself as one of the most luxiours car brands in the world along side with other  luxury car brands such as BMW, and Mercedes and does not feel the need to promote sales knowing they will still attract customers regardless of promotional sales. Although, Audi will hold special incentives such as the "Audi Owner Loyalty Incentive" for returning Audi customers that currently own or lease any model year 2001 or newer Audi vehicle. Based on which 2012 Audi vehicle you choose , this loyalty offer extends $500-$1,500 towards the lease or $1,000-$3,000 towards the purchase of the customers next Audi vehicle. With all that said Audi's main focus is on personal selling.

 

 Personal selling offers both advantages and disadvantages in comparison with other elements of the promotion mix. It allows the salesperson to target the message specifically to the audience and receive immediate feedback. In this way, it is more precise than other forms of promotion and often has a greater persuasive impact. Conversely, personal selling cannot reach as many potential customers as advertising, plus the cost of each contact is much higher. Another advantage is that personal selling can be an important source of marketing information. If the sales force is well trained, acting as problem solvers and advisors for customers rather than using hard-selling tactics,personal selling helps companies such as Audi to build loyal, long-term relationships with customers. The whole experience of going into a dealership and talking to a Salesperson is the definition of personal selling. When you walk into an Audi dealership, the Salesperson approaches you, tells you their name, and will begins asking you questions such as , what you are looking for, and what car fits you and your personality the best. In most cases, the salesperson will be your liaison with the Audi dealership forever, assuming you by a car. He or she therefore grows to know you, and is the ideal person to work with if you have any problems or complaints, as that person is almost a friend to you, based on the relationship they have established through professionalism, courtesy, and understanding of their customer. This is essentially the definition of relationship selling. The salesperson will always be "your salesperson", and you will very rarely have to deal with anyone else on any issue regarding your car. This is a relationship rarely found in the world of consumers and sellers, but when it comes to such a large investment as a car, this kind of service is expected and demanded by everyone.                                                                                                                                                                                                                                                           

 

 

Chapter 17 Advertising and Public Relations

Audi, like most other luxury car brands, is very specific when it comes to who they advertise to. Their target market are only middle upper class people, who can afford a car that cost anywhere from  $60,000 to $150,000. Therefore, they cannot really advertise to anyone else but that one particular group. This makes it easier for Audi, and  allows them to concentrate more on the style and execution of their advertising as opposed to their target audience. Audi is well-known for its innovative advertising. In the past numerous Audi commercials have caused a sensation both among customers and in the creative industry. They imploy  humorous entertaining commercials, for example the new Audi commercial where a girl thinks her father is a alien and believes his Audi A6 is a spacehip because of its technology and brand new features.

Audi and BMW have long been in an advertising war that pitches each company's new car against the others, mainly their sportier cars. Below is a billboard they made in response to BMW saying they had just won World Car of the Year. Audi has won the "GOLD EFFIE 2002", the measure of all things in terms of advertising efficiency in Germany.

In terms of public relations, Audi is very active in positive promotion for their brand while also showing their belief in social responsibility. Audi has been a strong supporter of the Elton John AIDS Foundation, and recently put up two Chrome Audi R8's, their most expensive and prestigious model which brought in almost $1 million. Last year they teamed up with Tom Brady, quarterback of the New England Patriots, and the Best Buddies foundation. They managed to raise about $350,000, a sizable contribution to the $36 million the pairing has amassed in the last 4 years. 

Chapter 15 Retailing

Since I wasn't planning to buy an Audi it made no sense to visit one of their dealerships , so I picked a retail store that would best correlate to Audi's dealership and was convient for me. In this case I went to Foot Locker. Foot Locker retail stores are all owned and operated by Foot Locker, they are chain stores. Foot Locker is the worlds leading athletic retailer with over 3,600 stores in 21 countries in North America, Europe, and Australia. There are 100 Footlocker reatil stores in both New York and New Jersey.  The stores offer a good level of service,  one to one membership service, and good selections on sneakers and other clothing accessories. Foot Lockers online store is also very popular, as it is accessible worldwide and convenient. Online or by phone one can pre order sneakers and other clothing products.  In Foot Locker retail stores consumers usually consider price to be secondary in specialty outlets. Instead, the distinctive merchandise, the store’s physical appearance, and the caliber of the staff determine its popularity which can be classified as specialty stores. Foot Locker stores are tuned to cater to the sneaker consumer  and to embody  the company brand image and ethos. The Foot Locker  stores’slogan is: “I run because I refuse to sit” this slogan has stood with them forever and has been endorsed by many famous athletes such as Deion Sanders, Barry Sanders, and Micheal Irvin. Similar to the marketing mix, there is a retailing mix the 6 Ps: product, place, promotion, price ,presentation, and personnel.
In the store you can find all brand and type of sneakers whether it is running shoes such as Nike, basketball shoes such as Jordans , and clothing for sportswear. They also sell accessories, such as headbands, and wristbands for basketball and socks for other sportswear. All Foot Locker stores in NYC are conveniently located, none being more than 3 blocks from a train stop and also in high traffic areas. The flagship store is at 34th street and 5th Ave. The store has so many options of what to choose for your footwear and other accessories. All employees wear a black and white striped shirts to be easily recognized. The personnel at the stores is very attentive and knowledgeable.

Chapter 6 Consumer Decision Making

The consumer's decision making process might be the most intense and detail-oriented process out of any other product when buying a car.  When it comes to spending that much money on a product , the consumer  will carefully examine every pro and con that the car has to offer. If the consumer knows what he or she is looiking for, Audi makes this process quite easy. In the intiaal stages, the consumer will most likely test drive an Audi.  Audi's new Quattro system allows the driver to have an almost velcro-like grip on the ground, while they're new emission-reducing engines still create the same amount of raw power that a normal, environmentally harmful engine would. Social class obviously has something to do with the process, as someone who makes a six figure salary probably wouldn't want to drive a Honda or Toyota, as they are not appropriate signs of ones social status.   When it comes to post purchase behavior, the consumer will be extremely pleased with Audi's top of the line customer service who always take great care for the customer if there is an issue. Also, to match up with their competitors, Audi has begun to give their cars a better resale value. Audi's focus on the consumer has become one of the most important priorities to them, and is part of the reason that keeps the company successful.

Chapter 5 Developing a Global Vision

Audi's global vision has always been to bring about a luxury car brand worldwide and create the best models of cars to compete with other luxury brands such as Mercedes Benz, Bmw, and Lexus. Through global marketing Audi has developed one of the most luxury car brands in the world. Though Audi's revenues and vehicle sales still lag behind those of German premium-car rivals BMW and Mercedes (DCX), its engineering edge and design savvy have polished Audi's premium-brand image to a high sheen. Now, global market-share gains and profit improvement are narrowing the gap and transforming Audi into an ever more powerful rival. In 2006 it was projected Audi's sales would sprint from 924,085 cars in 2006 to 1.5 million by 2015.



Audi's widening product palate and huge global marketing push is finally giving it traction in the U.S., where sales are much weaker than those of BMW and Mercedes. Audi  posted record sales in 2011 as demand for luxury cars in China and Russia helped it gain ground on bigger rivals like BMW and Daimler's Mercedes-Benz. Audi wants to dethrone BMW as the world's number one premium car maker by 2015 through powering ahead in China and the United States, the world's biggest luxury car market. One of the reasons why Audi is doing so well is because since 2002 VW Group has invested no less than $25.6 billion  in its premium brand. Audi has now 12 model lines, as opposed to 2003 when they had only 6. Audi managed to overtake Mercedes-Benz last year and wants to take the lead from BMW by 2020. Audi reported its 13th straight record-setting month of sales with 9,354 vehicles sold in January 2012, topping the 7,812 vehicles sold in January 2011. Year-over-year vehicle sales increased 19.7% over 2011, the previous record set a year earlier. For the record-setting month of January 2012, four Audi models recorded year-over-year sales increases of 15% or more, including the Audi A6, the Audi Q5, the Audi Q7, and the Audi TT model range. Audi wants to continue its dominance as the world's best luxury car brand and continue to expand its globalization.

Chapter 4 The Marketing Enviorment

 

The Marketing Environment for car companies is always extremely competitive. With people who can afford other luxury brands such as Mercedes Benz, BMW and Lexus, car companies like Audi have to find new innovative ways to grab that customer's attention and draw him away from  other car competition.  First they have to look at the kind of people they are trying to attract and what values these people possess and how does it fit into their lifestyle. People who want an Audi want a car that shows their style, wealth, that luxury brand but more importantly something that will satisfy them in the long run. Audi advertisements can be seen almost eveywhere , they are always being sponserded by the New York Yankees for example when you tune in to watch the yankees you will see behind home plate the Audi symbol, they are  in the newspaper, and TV commericals. In a TV commercial, they don't target their ads towards only the upper middle class but to the average person. Their commercials are mostly entertaining and funny , so it won't alienate anyone and appear as this car is only made for the rich  and also make them think, they cant afford this type of car because they don't have the luxurious life style as the upper class and won't be able to afford such a luxury car. For example, Audi recently released one of its newest commercials for its newest model the S8 the commercial was titled as the "Suspect". The main theme of this ad was bascially to show how a driver in his S8  and how he thought he was part of a bank robbery but wasn't as he was using his imagination. The whole purpose wasn't focusing on the the car but the inspiration the car gives its owner. The commercial made people laugh, and makes a consumer realize just how precious and luxurious the car really is and the attention it grabs. Audi got their point across without making it seem like a normal person can't afford to buy their cars. Instead they created a welcoming atmosphere into which regular people can afford their brand cars and look at other models if the specific one you want is to much. Audi creates these commercials and ads so that even if you can't afford a 100k car you can still walk into their dealership and look at something more affordable and towards your price range. This is all part of the marketing enviorment.

Chapter 3 Ethics and Social Responsibility

At Audi social responsiblity and business ethics is a matter of regular practice. Some ways in which Audi has exhibited their understanding and value of social responsibility is by trying to reduce their carbon footprint on the world. In order to reach a solution Audi has been involved in forums such as the Bavarian Enviorment Pact and the National Electromobility Platform, Audi contributes its expertise and assists in finding solutions for the future. The Audi foundation for the enviorment is involved in projects for enviormental protection and education, and Audi promotes a large number of initiatives to increase the attractiveness of the Ingolstadt location-for its employess and their families. Audi is involved in the working forums IPP and resource Efficiency" and Management Systems . The goal of working in these forums is to ensure that the experience aquired by Audi. This is the only way to achieve the aim of enhancing the power of innovation and bringing about sustainable growth. Motivated and committed employess secure the success of the company. Employee identification with the brand is very high at Audi. In the Universum "ideal Employer" Audi has been voted into first place by engineering graduates. Among students of economics, Audi ranks second place. When choosing an employer, key factors include a good working atmosphere, fasinating products, market success and intresting work, as well as secure employmnt and personal development. Audi offers its employees a large number of training and educational oppurtunities, maintaining a dialogue with highly respected universities and other educational institutions. Audi makes an active contribution to enhancing the attractiveness and quality of life of the Ingolstadt location. This involves things such as secure jobs and employee profit-sharing.Audi is intensively involved in the immediate, regional surrounding its plant in Ingolstadt. its objective include a high level of innovation in research and devlopment in the region for visitors, future residents  and employers. At the ned of 2009 AUDI AG reinforced its commitment to enviormental protection issues. Audi has also established the "oak forest project", the project investigates factors as the interactions between planting density and carbon dioxiode on one hand, capture potential and biological diversity on the other. Audi consumes energy,water and raw materials in vechile production. water materials, wastewater and emissions are created in the progress. Both input and output are continously reduced by the Ingolstadt plant. the recycling of materials is having a decidedly positive effect, resources are reused or recovered multiple times. It is a primary principle at Audi to foresee and prevent enviormental pollution. This is how Audi meets its ethic and social responsibility.

Chapter 2 : Strategic Planning for Competitive Advantage

Since 2008, Audi’s marketing objectives have been to increase brand awareness and sales in a down economy, taking advantage of the fact that most marketers cut back on marketing during a recession. To do this, Audi has used several unorthodox viral marketing campaigns worldwide. These include the Stolen Audi miniseries TV and YouTube video spots and Meet the Beckers videos aimed at Audi’s competition. Both campaigns were instant hits online and offline. Viral marketing works for Audi because it is perceived to be unorthodox which matches Audi’s brand position in the marketplace. The viral marketing campaigns have succeeded to slow declining market share compared to other car brands in the current recession and have actually increased Audi’s brand awareness over its competition

Audi is launching the new A6 in the United States in late 2012. This marketing plan is designed to create awareness and impact around the A6 launch also to increase the market share by selling new cars. With this campaign, Audi will focus on affecting the target audience, driving quality user generated content, leveraging social media platforms and having a high impact launch that will generate buzz around “Audi Envy” The creative and media strategy is designed to position A6 as the most modern, innovative and luxury product in the marketplace. Media budget part will provide A6 dominance especially in Q3 around product launch.

While others follow convention Audi leads the way. The revolutionary racing innovating technologies on the track, breaking new grounds with advanced engines that produce more horsepower with smaller displacement. Pioneering S tronic transmissions that shift instantly, transferring power in a few hundredths of a second, adding new dimensions to the quatro all wheel drive boosting grip and control. Advancing Audi ultra lightweight technology to make the cars responsive and agile and efficient.

Their newest model the R8, provides the surefooted traction a super car needs while the Audi magnetic ride and the stability enhancing ASF aluminum space frame contributes to the feeling that your connected to the road.

The revolutionary ASF aluminum space frame reduces the vehicles weight and provides extremely rigid cases that help increase stability and enhances its performance.

Chapter 1 History and Mission Statement

The company name "Audi" comes from the Latin translation "Horch", named
after its creator August Horch. It was founded in 1910 and produced
vehicles  for the first world war. Some of them which won serval
rallies. These victories helped establish the company name worldwide.
Because of the financial  debts Audi faced after the war, it united
with three other independently owned companies which were DKW, Horch,
and Wanderer. Audi's four rings symbolize the union of these four
companies. In the early 21st century Audi claimed several world records
such as top speed enurance on a German racetrack . In 1990 Audi began
to upgrade and shift  its target market to compete with luxury brand
cars such as Mercedes Benz and BMW. This year Audi won Engine of the
year award for the third year in a row and won the US international
design excellence award. Today Audi remains one of the fastest and
technologically advanced cars on the road.

Misison : we delight customers worldwide



The Audi brand’s products are compelling examples of the brand values
sportiness, progressiveness and sophistication. In addition to building
technologically advanced vehicles, the brand with the four rings aims
to evoke customer delight in many other ways.

The mission statement “We delight customers worldwide” therefore plays
a key role on the path to becoming the leading premium brand. The Audi
brand has defined its understanding of customer delight in greater
detail in the following four areas of action:

We define innovation
We create experiences
We live responsibility
We shape Audi