Consumer Behaviour: Audi A7

This report analyzes the target market of Audi A7 along with the marketing messages and strategies used by the company to attract the target market. It discusses the product features, pricing strategy, distribution channels, and promotional activities of Audi A7.

Running Head: AUDI A7 0
Consumer behaviour

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Executive Summary
Audi is a Germany based luxury car company offering products with high quality, design and
technicalities. The company had introduced Audi A7 in 2010, which is an executive range of
car. This report analyzes the target market of Audi A7 along with the marketing messages
and strategies used by the company to attract the target market. To achieve the purpose, four
Ps Marketing Mix approach has been utilized. Through target market analysis, it has been
realized that Audi has segmented its target market for luxury and cozy cars on the basis of
psychographic as well as behavioral factors. It has also been realized that internet, television,
social sites and other promotional sources should be utilized effectively for the purpose of
promoting A7 brand.

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Table of Contents
Introduction................................................................................................................................3
Marketing Mix...........................................................................................................................4
Target Market & Strategies (Psychographics or Behavioral)....................................................9
Focus of involvement...............................................................................................................11
Recommendations/Conclusion.................................................................................................11
References................................................................................................................................12

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Introduction
Audi is a Germany based luxury car company. The vision of the company is to become a
premium car brand across the world. The company has become a reliable and most popular
brand in the motor vehicle industry. The automobile manufacturers from Germany decided to
design cars to cover the vast market of luxury cars across the world. In 1932, the
amalgamation of NSU, Horch, Wanderer and DKW created Audi AG that has its
headquarters in Bavaria, Germany (audi.com, 2018). Audi brand holds the market by offering
products with high quality, design and technicalities. Audi has become a known trademark
due to its high quality products and for making cars having exceptional power. The
aspirations of the company are to become a leading company amongst automobile industry
and to remain reputable as a premium brand in the market. The company invests a lot of
amount in technical and innovative advancements for the purpose of designing unique and
high quality cars. The models of cars range from A1 to A8, wherein, A8 is a full-size luxury
car along with SUVs and various other models. The company introduced Audi A7 in 2010,
which is an executive range of car with five-door liftback featuring sloping roofline with
sharply raked rear window along with integrated boot lid or Sportback and four frameless
doors (Mayer and Wickern, 2011). The loyal customer base of Audi is because of the majorly
popular products being delivered to the customers. The slogan of the company such as
‘Progress through Technology’ is used by the company for commercial advertisement of its
products in the market.
In this report, the target market of Audi A7 will be analyzed along with the marketing
messages and strategies used by the company to attract the target market.

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Marketing Mix
Product
The concept of Audi Sportback vehicle has been powered by 3 litres V6 TDI clean diesel
engine rated at 225 PS and 550 N.m. of torque. It structures a 7-speed S Tronic transmission,
Quattro permanent all-wheel drive system and five-link front suspension, electromechanical
steering, damping control shock absorbers, ceramic brake discs, front 6-piston monobloc
aluminium brake calipers, rear floating-caliper brakes along with 21-inch wheels.
Considering engine type, its capacity (cc) is 2,995 with a power of 5000-6400 rpm. It is also
available in 10 colours mostly with metallic body and paint finishes. For now, just two 2019
Audi A7 variants will be available in Australia fitted with mild-hybrid technology embedded
with a belt alternator starter and a 10 Ah lithium-ion battery (Williams, 2018). Overseas,
Audi A7 Sportback 45 TFSI 180kW with Premium plus package in Triton Blue shown. This
variant in Triton Blue exterior colour is due for arrival in Australia in 2019.
Price
Audi has a great impression in the minds of customers in the context of luxury cars, but it
utilizes premium price policy for the purpose of achieving brand image in the market (Zeng,
Dasgupta and Weinberg, 2016). Considering the highly competitive market, the pricing

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strategy of the company is based on the competitive pricing of the premium car makers in the
industry. Audit A7 arrive in local showroom with priced from $131,900 plus on on-road costs
Williams, 2018). The company also claims that more than $10,000 of extra value had been
placed in each A7 spec in addition with extra standard equipment and more technology. In
order to retain potential customers as well as to help the customers to buy products easily,
Audi Finance provides an innovative financial option to the customers. Audi has been
performing consistently price rise from time to time has been accredited to boost the Forex
rates.
Below, it is shown the Audi A7 prices going up and down with changed over time.
Source: (cargurus.com, 2019)
For the purpose of keeping the rationale of the price, innovative finance options by Audi
Finance has made the purchase for the customers highly attractive. In addition to it, to retain
existing customers, optional pricing strategy has been employed so that they can utilize
optional features available in various models of cars such as Audi Bang, navigation system,
sound system and optional accessories which are being purchased by the customers willingly.
The price variations in varying models of Audi depend upon geographical locations as well as

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economic conditions of different countries, for example, Audi A7 is expected to launch in
India with an estimated price of 90.50 lakh rupees while in US, the starting prices will be
$68000 (Dhabhar, 2017). It exhibits its premium pricing strategy or the skimming price for
different countries. The dealers and showrooms propose reimbursement plans that will permit
wide range of people to have easy accessibility to the brand.
Place
While international deliveries for the new Audi A7 with an expected public unveil perhaps at
the LA Auto show, expect the car to make it to various other countries next year. The special
guest at the Australian launch of the Audi A7 Sportback was Andreas Koglin. The new model
Audi 7 will be launched in many locations but the company targets new market seeking
prospective customers as a result of which, Audi is making investments in Asian market and
is continuously developing as well. Audi has recognized and has maintained its existence
through exclusive dealership network along with its after-sales service centres. The company
has utilized a channel of sources from producer to distributor, wholesaler, dealer and
customers as well (Saadi et al, 2013). Considering its strategy of innovative technology,
Audi 7 has superior technologies attaining customer satisfaction with an idea to become a
highly successful premium car at international level.
Promotion

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Source: (paultan.org, 2015)
The logo of the Audi is a major promotional content as four overlapping rings in its logo
automatically generates a brand image of the company in the minds of customers. The
company has participated in sponsorship of various sports projects such as Italian football
teams and cautiously picks these marketing opportunities to reveal its image in front of the
customers. It is having a permanent feature in Sony’s PlayStation Home through which, it
keeps itself in front of public without overdoing it. Audi spent close to an estimated $200
million each on national TV advertising during 2014 and the company also invested its $195
million on more national spots, across more networks and more TV shows (Muller, 2019).
Audi bought nearly 5,000 more national airings with a total of 19,725 spots. They also feature
Ricky Gervais and the Doberhuahua aired on nearly 2,500 shows. Along with television, print
media and internet banking, Audi has been engaged in getting the products endorsed by a
number of celebrities for better promotion of the products. Due to its premium trademark
image, the company does not believe in mass marketing and emphasize on nurturing its brand
image through note that high profile people prefers Audi cars and pull its specific target
market.
The current marketing approach that has been projected in 2010 and is supposed to continue
till 2020 and, it is based on three-tiered strategic approach that starts with the vision, mission
and goals of the company. The vision of Audi is its Premium Brand as its updated strategy
fastened sustainability and upgrading of products, procedures and innovation to offer
customers with amusing experiences as well as signifies economic, ecological and social
responsibilities. The new commercial on Audi A7Sportback “Midnight Edition” shows the
newest customizations that could be obtained from dealership. The Film titled “A
BEAUTIFUL WORLD” portrays the things to be offered by life along with delightful and
extravagant things surrounding success.

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Earlier to the new marketing strategy of the company, the goals of Audi for the purpose of
executing its mission statement had always been to attain financial potency, continuous
growth, to become worldwide luxury automobile industry leader, and to be a striking
employer all over the world. After the implementation of new corporate strategy, the
company has sustained existing goals and extended its objectives as well.
The majority ownership of Audi has been upon Volkswagen for more than four decades now.
In 2017, Audi has delivered 1.9 million cars, out of which, A3and A4 has been the most
popular car models with around 631,000 cars delivered during this period (forbes.com, 2019).
As per the list of Forbes’ Most Valuable Brands in the year 2018, the brand value of Audi is
$14.8 Billion with sales of $59.1 Billion. It has trolled Tesla with its billboard campaign
wherein, it called its upcoming electric SUV as ‘Musk-have’ in billboards all over the Berlin.
It is because the new vehicle named the e-Tron Quattro has planned to compete with Model
Y of Tesla. Similarly, in competing with a number of popular brands and to put forward
strong social message, Audi has delivered a powerful message related to equal pay for
women. In an advertisement titled “Daughter”, at the end of the ad, the message in bold says
“Audi of America is committed to equal pay for equal work. Progress is for everyone.” Not
just for advertisement and promotion purpose but also in actual, the brand took initiatives to
increase the number of female employees in the industry. Through this short video about
gender inequality, the brand has become able to raise awareness and to encourage its
customers in order to support the cause of the company.

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Target Market & Strategies (Psychographics or
Behavioral)
Audi A7 target market is men aged 35 and over and who like practical car and love driving
with a powerful car. With various innovative online campaigns, the company engage and
interact with the targeted audience across variety of channels. Audi Group has continuously
been one of the successful car makers in category of premium as well as supercar segments.
In addition to it, the sales auxiliaries of the company supply cars of other Volkswagen brands
to clients. The company has sustained its victorious progress and growth consistently in spite
of demanding environment in the market. Being a premium automobile company, it values
technology and considers its target market in a similar manner.
Audi has segmented its target market for luxury and cozy cars on the basis of psychographic
as well as behavioural factors. The company has targeted its customers from upper classes,
professionals as well as executives from wealthy backgrounds considering Audi to be
affordable for them. In addition, customers from well-off families can appreciate the
technological advancement and innovation in products in the form of newer models being
delivered by Audi. As the car models of Audi are known for their attractive designs and high
quality materials, the expensive cars could easily be affordable by the company (van Tuijl
and Carvalho, 2014). The strong and positive brand image of Audi is the key to success for
the premium car maker company. The young buyers are also targeted by the company
because they are said to be driving crazy. The car emphasizes on design and style of the cars
instead of speed of its cars because youngsters also prefer technologically advanced features
in cars and uniqueness in design of cars. The company has positioned itself as providing well-
engineered stylish cars as per its tagline which is ‘Vorsprungdurch Technik’ in German, and
it refers to ‘Lead by Technology’.
Audi has a noteworthy competitive benefit over its competitors BMW as well as Mercedes-
Benz due to global purchasing power of Volkswagen being used by the company. It has
brought alliance not only of six huge brands but also includes local procurement
organizations of Volkswagen in Mexico, Brazil, China and South Africa. It has employed
dedicated as well as passionate people from all across the world, who are making efforts
continuously to make it a premium automobile company worldwide. Among various models

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of Audi, A1, A5, Q5 and TT series car models are in huge demand despite facing extreme
competition in the market from other premium car makers such as from BMW and Mercedes
(Hertrich and Mayrhofer, 2016). Q3 and Q7 are also in great demand because of their unique
features but A3, A7 and A8 are almost out of this competition because competitors are
already providing better models in lesser costs comparatively. Audi makes its flagship
vehicles readily available to customers by distributing its products through authorized and
efficient distributors. The company is dedicated to continuing investing in creating more and
more flagship stores in order to enhance customer experience. Simultaneously, the company
is also emphasizing on expanding the number of authorized dealers for its unique and
expensive models (Bohnsack, Pinkse and Kolk, 2014). By increasing the number of
distributors and dealers all across the world, Audi will efficiently approach its target market
across the globe. The major factor in distribution strategy of the company is the location of
stores, which require huge area for display showrooms for various models of cars and high-
class locality as well. Due to the involvement of such a huge investment, the margins of the
dealers are also high. However, it costs much to the company but profits arising due to
increasing sale among target segments overpower it.
The main reason, because of which customers remain associated with Audi, is the strong
brand name and positive image of the company. They believe that it is a reliable company
and they can rely on its products. Due to this reason, the brand loyalty of the company is
growing day by day which itself is more than enough to keep the competition high for other
competitors worldwide. The promotional strategies of Audi involve sponsorships with
automobile races and brands, television shows, movies and video games along with various
advertisement projects, which have increased the brand value of the company in the eyes of
the customers.
Considering its business expansion strategy, Audi is also seeking opportunities in Asian
market, which will be new for the company and is also developing rapidly in the automobile
industry (Ramakrishan, 2015). The newly emerging markets of Asia particularly India and
China are considered to be as huge opportunities for Audi. The sale of cars in both these
countries are increasing because these countries are getting wealthier day by day and are
more discerning and are preferring high-class brands such as Audi, BMW and Mercedes-
Benz. The potential market for Audi is providing them with the opportunities to be a leader in
the automobile industry. Another reason for Audi to select India and China as its target
market to expand their automobile industry is the population of these countries, which can

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provide them with huge labour source with cheaper cost of production as compared to other
European countries. The living standards of people are becoming high and the demand for
luxury cars is increasing day by day among the target segments of the company.
Focus of involvement
By contrast on Audi A7, it includes high involvement decisions includes a higher risk to
consumers if they fail are complex, or have high price tags. Audi A7 is not purchased often
but are relevant and significant to the buyer. In this, buyer do not engage in routine response
behaviour while buying high-involvement product. Instead, they engage in what called
extended problem solving in relation to Audi A7 features such as products, prices, and
warranties.
Recommendations/Conclusion
Taking an in-depth look into the marketing and promotional strategies of the company, it has
been realized that Audi is making no stone unturned in marketing and promoting its products.
A7 has created a benchmark in terms of innovation and technology. Additionally, it is
searching for new target markets to expand its business in new countries as well. For the
digital campaign and promotion of Audi A7, the company needs to give their business to
some digital marketing agency that helps the company in various ways such as making
interactive relations with the customers and reach to the social media users in a cost-effective
way. The internet, television, social sites and other promotional sources should be utilized
effectively for the purpose of promoting A7 brand because it is not in much demand as
compared to other known models of the Audi. As customers are becoming more concerned
about CSR responsibilities by companies and prefer such companies over others, Audi should
strategize to relate the marketing and promotion strategies of Audi A7 to this aspect in order
to attract customers. The cost-cutting strategy or some specific additional features in the
model might most probably enhance the demand of this model in the market.
Considering all, Audi A7 success is connected with its potential promotional strategy and
optimum target market strategy. In addition, the company can expand with more of their
products to the Asia market due to high economic potential and availability of resources.

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References
audi.com (2018) Four rings – four brands [ONLINE] Available from:
https://www.audi.com/en/company/history/four-brands-four-rings.html [Accessed
09/05/2019].
Bohnsack, R., Pinkse, J. and Kolk, A. (2014) Business models for sustainable technologies:
Exploring business model evolution in the case of electric vehicles. Research Policy, 43(2),
pp.284-300.
cargurus.com. (2019) Audi A7 Price Trends [ONLINE] Available from:
https://www.cargurus.com/Cars/price-trends/Audi-A7-d2113 [Accessed 09/05/2019].
Dhabhar, C. (2017) All-New 2018 Audi A7 Sportback Unveiled [ONLINE] Available from:
https://auto.ndtv.com/news/all-new-2018-audi-a7-sportback-unveiled-1764846/ [Accessed
09/05/2019].
forbes.com/ (2019) #37 Audi [ONLINE] Available from:
https://www.forbes.com/companies/audi/#366441894725 [Accessed 09/05/2019].
Hertrich, S. and Mayrhofer, U. (2016) Audi and the Chinese Market: A Success Story.
In Market Entry in China (pp. 37-44). Cham: Springer.
Mayer, W. and Wickern, G. (2011) The new Audi A6/A7 family-aerodynamic development
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Mechanical Systems, 4(2011-01-0175), pp.197-206.
Muller, S. (2019) Audi Takes Advertising Lead from BMW in Advance of Luxury Brand
Battle [ONLINE] Available from: https://laurenfix.com/article/audi-takes-advertising-lead-
bmw-advance-luxury-brand-battle/ [Accessed 09/05/2019].
paultan.org. (2015) Audi [ONLINE] Available from: https://paultan.org/2015/03/14/audi-a6-
a7-a8l-ad/audi-a6-a7-a8/ [Accessed 09/05/2019].
Ramakrishan, A. (2015) India is ‘a strategic market for Audi’ [ONLINE] Available from:
https://www.thehindubusinessline.com/news/india-is-a-strategic-market-for-audi/
article7024806.ece [Accessed 09/05/2019].

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Saadi, M., Wattisuttikulkij, L., Zhao, Y. and Sangwongngam, P. (2013) Visible light
communication: opportunities, challenges and channel models. International Journal of
Electronics & Informatics, 2(1), pp.1-11.
van Tuijl, E. and Carvalho, L. (2014) Knowledge sourcing, knowledge bases, and the spatial
organisation of car design. Environment and Planning a, 46(8), pp.1966-1982.
Williams, J. (2018) 2019 AUDI A7 AUSTRALIAN PRICING AND SPECIFICATIONS
REVEALED [ONLINE] Available from: https://www.chasingcars.com.au/2019-audi-a7-
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Zeng, X., Dasgupta, S. and Weinberg, C.B. (2016) The competitive implications of a “no-
haggle” pricing strategy when others negotiate: Findings from a natural
experiment. International Journal of Research in Marketing, 33(4), pp.907-923.