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... ow or accepting half the money now and half when the Oldsmobile Company shut down. The Oldsmobile distribution system is a key external resource and Oldsmobile proved this by treating each dealer fairly. Promotion Marketing requires more than developing a good product, pricing it attractively, and making it accessible.
Oldsmobile had to communicate with many internal and external sources. Therefore, they had to adopt a promotion concept to encompass advertising, promotion, public relations, selling, and direct marketing. Oldsmobile was very successful during the introduction and growth stages of the product life cycle. Sales and profits were at their peaks. The target market was mostly families with children and older people. The Cutlass and Oldsmobile Eighty-Eight were identified as the best product for your money and the buyers accepted this marketing concept.
The changes in demographics and cultures during the late 1980 s and 1990 s forced Oldsmobile to target the younger market. Oldsmobile did not change with the times. They allowed other automotive manufacturers to capture the import market and truck lines. Later, Olds tried to regain these markets in the maturity and decline phase of the product life cycle.
They introduced the Aurora, Alero, and Intrigue, and the Bravada sports utility vehicle to compete with the competitive import models, but as the saying goes it was too little, too late. It was a risky repositioning move to cancel the Cutlass and Oldsmobile Eighty-Eight because it takes skilled marketers to promote a new product with no identity alongside the other more established products in the line. The Oldsmobile Division has used the same advertising agency since 1937. Leo Burnett USA Adverting Agency persuaded management that Oldsmobile and Buick had the same customers during the late 1980 s and 1990 s. General Motors decided to let Buick handle the traditional customers.
Oldsmobile was given the task to appeal to the younger buyers. The campaign slogan to attract the younger market was this is not your fathers olds, driving home the point that the consumer wasnt sure what Oldsmobile represented. The promotions and advertising concepts led to confusion and a decline in sales of Oldsmobile. It caused a disaster and contributed to the death of Oldsmobile. ENVIRONMENTAL ANALYSIS Economic Environment With most any sales operation, the major influencing environmental factor is the economic outlook of the nation. When the economy is doing well and forecasted to continue, companies hope and expect to see an increase in their sales.
Consumers tend to increase overall spending as announcements are made about the increasingly favorable outlook for our economy. Some consumers not only take the economic outlook of our nation into account; they may also make judgements based on what is going on in foreign markets. Companies must keep in mind the economic standing of their target market. Their income, savings, debt and credit availability are all deciding factors in whether they will be able to make a purchase or not. Credit availability is especially important for more expensive purchases where a loan will be necessary. If the consumers in their target markets cannot secure the loans needed to make the purchases then companies cannot expect to see an increase in sales.
The rise and fall of the interest rate also greatly effect sales. When making a major purchase, consumers will most likely secure a loan to pay for their merchandise. This can include purchases such as homes, cars, electronics, etc. The lower interest rates will often stimulate consumers to move forward with their purchase plans sooner. Competitive Environment All companies use significant marketing resources in an effort to keep their company name on top.
In recent years the product market has been overwhelmed with more and more products, but the number of consumers hasnt increased with it. In order to stay competitive, companies must keep their prices affordable and attractive to consumers while continuing to make a quality product. In a perfect world, these efforts should keep the company successful and profitable. One thing more and more companies are doing is attempting to target younger consumers. By attracting younger consumers that are new to the market, companies hope to establish a bond with these consumers. Hopefully, the experience the younger consumer has with the company and the product will create a feeling of satisfaction, making the consumer choose their particular brand or company name over others when the time comes to make another purchase.
Another thing that is important to stay competitive is to offer a quality product. While price is an extremely important factor, the product must be worth it to the consumer. Consumers are looking for a competitive price not a cheaply made product. If a consumer chooses a product based on the fact it has the lowest price, but the product doesnt do what it says it will or wears out in an untimely manner, chances are that consumer wont make a repeat purchase. Instead, most consumers will spend a little more money in order to get the quality they expect. Technological Environment Over the past few years the technology available in the market place has changed dramatically.
These changes have been faster than many manufacturers anticipated. Companies must work harder than ever to keep up with the pace of competitors by staying aware of technological developments. Production efficiency has to be the area where technological changes have made the most difference. With the use of automated equipment, such as a robotic line, companies are able to replace one or more workers with just one machine. These machines are costly and each company must decide if the technology will be the most cost-effective move for their industry.
Computers have also proved to create changes in the way we run our businesses today versus the businesses of yesterday. Just about every company, whether large or small, uses computers to keep up with their day to day operations. Computers and their continued development allow companies to make sales via the Internet or by using e-mail. This process, when streamlined, can cut down on the cost per unit sold for the company.
Besides the changes technology can have on a companies process of doing business and the manner in which they create their product, companies must stay aware the technological progress in their market. Companies must also stay aware of changes made in their products as far as materials used, features added and services offered so that they will be able to offer the same or even better product. Socio-Cultural Environment Companies must work hard to identify with consumers and what types of consumers make up their target market. They have to be aware of the sub-cultures and social classes included in their target market.
Not in a sense of who they are, that would have already been designated, but more in a sense of what kind of person they are. Companies must be familiar with the views, beliefs, values and morals of the consumers in their market. One thing companies can do to keep in touch with and informed by their consumer base is to be involved in and sponsor different social activities. By sponsoring events, companies are given a chance to interact with their consumers to obtain feedback on their use of the product and gain insight as to the level of satisfaction that they have experienced. This can also be an opportunity to spend time with potential consumers and learn what services or products they would like to see offered. Political-Legal Environment Companies must stay abreast of developments in the political arena as they can have great influence on the markets.
The political and legal environment is the one environment businesses are able to influence. However, this area encompasses so much, it can be a struggle to keep up with it all. A huge political factor can be the party that is in control. The outlook for the markets can change when the White House changes from a democratic president to a republican president, as we just have. Consumers may begin to slow their spending in order to give the new president and his staff time to get settled in and see what type of changes they may be implementing that could effect them. White House scandals can also have an effect on consumer purchasing.
A scandalous administration can cause consumers to become weary of what may be coming. New laws that come in...
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Research essay sample on Product Life Cycle Target Market
