Consumer Behaviour Assignment : Ferrari

We will cover the following activities for Ferrari: history of Ferrari,  Situational analysis, vision and mission statement, market analysis, SWOT and  PESTEL analysis, target market description, segmentation, target market decision-making process, decision-making process, social influences on buying behavior, and 4Ps of the marketing mix. psychological influences on buying behavior. You can also check "Value Propositions and Relationship in Ferrari".

Running Head: Consumer behaviour for Ferrari
Consumer Behavior
Market Analysis of Ferrari

Consumer behaviour for Ferrari
Table of Contents
Introduction...........................................................................................................................................2
Situational analysis................................................................................................................................3
History of Ferrari...............................................................................................................................3
Vision and mission statement............................................................................................................3
Market analysis..................................................................................................................................3
SWOT.................................................................................................................................................4
PESTEL...............................................................................................................................................4
Target market description.....................................................................................................................5
Segmentation....................................................................................................................................5
Target market decision making process................................................................................................5
Decision making process...................................................................................................................6
Social influences on buying behaviour..................................................................................................6
Family................................................................................................................................................7
Social class.........................................................................................................................................7
Psychological influences on buying behaviour......................................................................................7
Motivation.........................................................................................................................................7
Perception.........................................................................................................................................7
Personal factors influences on buying behaviour..................................................................................8
Personality.........................................................................................................................................8
Lifestyle.............................................................................................................................................8
Market strategy recommendations.......................................................................................................9
4Ps of marketing mix.........................................................................................................................9
Conclusion...........................................................................................................................................10
References...........................................................................................................................................10
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Consumer behaviour for Ferrari
Introduction
Consumer behaviour is the conduct of an individual and the manner they perceive the
product and what all measures it considers before making any measures. The report
concentrates on situational analysis to know the market condition and then target market is
focussed through segmentation. The decision making skills have been analysed by focussing
on the decision making process. The market strategies are also concentrated by discussion
over the social, psychological and personal factor that are likely to affect the decision making
of customer and influence their mind. Finally to study the entire market the 4Ps should be
learnt so as to reach the best decision.
The report argues on the market analysis and consumer behaviour in context of
Ferrari. For that the history of Ferrari has been discussed along with the vision and mission of
the company. The market share and the competitors of Ferrari have been quoted followed by
the swot and Pestel analysis. Thereafter the market segmentation is quoted and the decision
making of target market is done which explains the entire process. Afterwards the market
strategy has been elucidated which influence the decision making of the person; these factors
are social, psychological and personal factor. The final assessment is conducted by
researching over the marketing mix of Ferrari to take the final decision.
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Consumer behaviour for Ferrari
Situational analysis
History of Ferrari
The company Ferrari was initiated on 1947 and the first ever Ferrari appeared on the
entry point of Via Abetone Inferiore situated in Maranello. The product line of Ferrari is
Enzo Ferrari which was launched in Modena in the year 1898 and exhausted in 1988 (Ferrari,
2017a). Thereafter another inauguration of Ferrari was Scuderia Ferrari which was initiated
in Viale Trento Trieste located in Modena, Italy. Sergio Marchionne is the Chairman and
CEO of Ferrari and Piero Ferrari is the Vice Chairman of company (Ballaban, 2014).
Vision and mission statement
The vision of Ferrari is that it is the excellence developed by Italy which is the dream
car for many people in the world. It depicts the sporty nature and luxury. The mission that
company carries is that it signifies the Italian excellence and stay of the prime position on the
roads as well on tracks (Ferrari, 2017b).
Market analysis
Ferrari Corporation focuses on the team work and symbolises that human resource is
the precious resource and the motive of company is to rule on the world. The competitors of
Ferrari are Porsche, Lamborghini, Mercedes, McLaren and Aston Martin (Ound, 2012).
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Consumer behaviour for Ferrari
Figure 1 Market share of Ferrari and its competitors
(Source: Munoz, 2017).
The market strategy that Ferrari adopted is studying about social influence, psychological
aspects and influence of personal factor on the business.
SWOT
Strength
 Innovative and quality conscious.
 Uniqueness in design (Ferrari,
2017c).
 Focus on the customer satisfaction.
Weakness
 As it is the luxury product thus
production is low.
 Advance booking is needed and
customer has to wait for 18 months.
 Less resources and rising cost.
Opportunity
 Global economy is developing rapidly
thus increasing the purchasing power
of customers.
 Varieties available in market.
 Production could be increased.
Threat
 Environmental factors affect the
production.
 Huge competitors.
 Fluctuations in foreign economy.
PESTEL
Political
 Changes in environmental policies.
 Changes in global policies.
 Changes in the automobile sector.
Economic
 Issues of recession.
 Development in the branch countries.
 Variation in foreign exchange.
Social
 High remittance of CO2.
 Lack of renewable resources.
Technological
 Developing advanced technology.
 Increasing patent.
Ecological
 Climate concerns have been paid.
 Environment friendly practices.
Legal
 Changes in legal policies.
 Customer safety.
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Consumer behaviour for Ferrari
 Standard emission of fuel.
Target market description
Segmentation
Segmentation focuses on various aspects that influence the buying decision of the
customer. The segmentation is divided in four elements that are geographical, demographical,
psychographic and behavioural. Geographical area involves the region which is focussed for
attracting customers and where more luxury crowd turns up. Demographical segmentation
includes the age, gender, income status, psychological and physical aspect of the customer.
Then is the psychographic aspect which includes the lifestyle and purchasing power of
customers. The behavioural aspect focuses on the study of stimuli and emotions of the
person; it is related to feelings, love and compassion towards the product (Zoller, 2017).
Geographical
The worldwide area has been covered. It is
spread all over the world at the posh location
where the rich crowd gets collected.
Demographical
Target age section is young population above
30 specifically men with huge income
(Ferrari, 2017d).
Psychographic
It involves the group of enthusiastic and
energetic people who mostly belong to the
urban areas. The lifestyle of people who
aspire for Ferrari is lavish and luxury and
who believes in show off within the society.
Behavioural
The premier customers are there who are
loyal towards the company.
Target market decision making process
The company has chosen the niche market and targeted lavishness. The target market
of Ferrari is rich customers who are conscious about status and seek importance. This
segmented area also decides to enjoy the similar service in area of two wheelers as well that
includes the motorbike which might come up as the style statement for youngsters.
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Consumer behaviour for Ferrari
Decision making process
Step 1: Problem recognition
First of all the need is analysed as to what customer aspire for. In case of Ferrari the
customer rests at the self-esteem position where the only thing that matters is self-efficiency
and status in the society and carrying this view the search has to be made.
Step 2: Information search
When mind makeup has been done search in context of Ferrari is made. The quality,
costing, eco-friendly concerns are focussed along with the customers and expert review.
Step 3: Evaluation
After collecting the required information in context of the luxury cars and comparing
it with the competitors the entire analysis is made. The data is measured and reviews gathered
are studied thoroughly to arrive at final decision.
Step 4: Purchase
At last when the features, costing, quality, reviews and life span of product is
analysed and evaluation process have been accomplished successfully the final purchases are
made and for the concern of status, quality and position in world Ferrari becomes the choice
of customers.
Step 5: Post purchase evaluation
The post purchase evaluation is the feedback that is received from the customer after
availing the services. At this point the positive and negative impacts are noted down and
satisfaction level of known. Measures are taken by the company to solve the issues that most
of the customer faced (NAP, 2017)
Social influences on buying behaviour
The external factors highly influence the decision making process of the person.
These forces change the need and perspective of the customer to make purchases. Such
factors establish the competition in the market and render the chance to entrepreneurs to
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Consumer behaviour for Ferrari
establish their business and target the niche market (Smith, 2016). The 2 external attributes
that socially affect the decision making of the person are: family and society.
Family
Family involves the core family, friends and relatives that highly influence the
decision and choice of the customer. Every person has the different view and perceives things
in entirely different manner. This is likely to influence the decision of the person as various
alternatives are suggested to them and they chose one best out of it (Dahl, 2013).
Social class
The impact of society on the decision making is another crucial aspect. The social
aspect involves family as well as the status and mindset of the society which quotes the
marital status, career of the customer. How much the pocket does allows and cost of
maintenance charges should also be kept in mind while making purchases (Solomon, 2014).
Psychological influences on buying behaviour
Psychology is the mindset of customers that helps in increasing the interest in
purchasing the product to fulfil the unmet needs. The psychological aspects constitutes of
motivation, perception, learning, attitude and beliefs.
Motivation
It could be better understood with the help of Maslow’s hierarchy. The person who
needs the basic amenities gets satisfied at the initial level only. In context of the brand Ferrari
and its product car the motivational level is to gain something that depicts the status and
living standard of the person. As per the current situation customer stands on the second last
stage of Maslow’s need hierarchy which states the self-esteemed position in the society. They
are not for the basic needs, these kinds of things are just to establish the standard and set up a
higher position in the society (Vainikka, 2015).
Perception
The perception is the mind set and image that the person carries regarding the product
they are planning to purchase. The perception helps in setting the brand positioning as well.
Considering the purchase of Ferrari the name itself says it all that the person need something
stylish, luxury and sporty. The perception constitutes of selecting the purchase, organising the
collected information and thereafter interpreting the information to reach the final decision.
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Consumer behaviour for Ferrari
Also the decision of the customer is highly influenced by the people around them (Rahman,
2015). Ferrari is the name that reflects comfort and lavishness, also to some people car is the
statement of style while some consider it as a four wheeler that makes transportation easy for
the long distance. Thus, along with need the attitude towards the product should also be
defined in a clear manner so that retention might be achieved which at last lead to customer
loyalty.
Personal factors influences on buying behaviour
Another crucial element that affects the decision making of the customer is personal
factor that involves lifestyle, economic status, occupation, personality, age and self-esteem.
In order to purchase the car the first thing that matters is what the age of the customer is, is he
eligible to drive or not. Also the occupation of the person depends upon the decision making,
by occupation it is meant about the designation of the employee. The top level manager of
large organisation who has high pay scale might agree over Ferrari while other low level
manager would settle at ford or Polo Vento. Therefore, only the need or desire to achieve
something is not necessary for that better designation, personality, adequate age and the
equivalent purchasing power is highly needed (Farah & Fawaz, 2016). The two basic factors
have been discussed as under:
Personality
Every person has the different personality and way of thinking. The personality of the
person changes with the change in age, time, qualification, income and other personal
reasons. The personality is the mash up of likings-disliking, habits, attitude towards the thing,
way of perception and other multiple things. For the sake to make purchase decision in
context of buying Ferrari the overall personality of person has to be analysed. The economic
condition, ego, attitude towards Ferrari, thoughts in relation to the car, is this just a car of the
status symbol and various other factors matters in constructing a personality and making the
buying decision (Gil, Dwivedi & Johnson, 2017).
Lifestyle
Lifestyle depicts the way a person carries out his/her life. The ambitions, level of
spending, perception towards certain things and importance of getting luxury items and many
more factors together form a lifestyle of the person. Also the lifestyle depends upon the
society from where the person belongs. If a person is multi-millennium but the society where
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Consumer behaviour for Ferrari
he/she resides focuses more on investing the fund rather than rotating it in the market and
fulfilling the luxurious desire than the thoughts of the person also catches the same direction
where the person stays, if they do the things of their mind then there are chances that they
might face the criticism (Atwal & Williams, 2017).
Market strategy recommendations
4Ps of marketing mix
Product
 From the societal point of view it is
symbol of luxury.
 From the psychological point of view
it is fastest moving leading sports car.
 From personal perspective it is the
efforts and lavishness that one
deserves after attaining certain
designation (Liu, Li, Chen &
Balachander, 2017).
Price
 Society measures the richness with
the increasing cost of the car.
 Psychologically the vintage car costs
$175,000 and the budget has to be set
accordingly.
 Personally along with the cost of car
the maintenance cost should also be
added before making purchases.
Place
 The distribution channels in all the
three factors remain the same.
 The outlets of Ferrari are established
in 52 countries and still it is planning
to expand in the targeted countries.
Promotion
 The promotions also do not differ
socially, psychologically and
personally, only the perception
changes.
 Merchandising option is used to
promote the product.
 The goodwill is the best way to
promote things as the name says it all.
 Certain companies even take
licensing permission to promote their
product by connecting it to Ferrari so
as to depict the quality (Haseeb,
2016).
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Consumer behaviour for Ferrari
Conclusion
Hence, the conclusion could be drawn that consumer behaviour is the vast topic that
has to study specifically and then also the seller could not predict the buyer’s decision as it is
highly fluctuating. There are various factors that affect the decision making of the person.
The report is in context of purchasing Ferrari and for that first of all situational analysis has to
be done which includes the background, vision, mission, swot and pestle analyst is to study
the entire market situation. Thereafter the target market could be investigated which discusses
the segmentation of the product. The effect of target market on the decision making which
explains the decision making process that a customer undergoes. Along with this the market
strategy that affects the decision making are also analysed which includes social influences,
psychological influences and lastly the personal impact has been discussed. To finalise the
marketing strategy and understand the buying behaviour 4Ps of the marketing are
investigated as well for developing the clear market knowledge.
References
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In Advances in Luxury Brand Management (pp. 43-57). Palgrave Macmillan, Cham.
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<https://jalopnik.com/who-will-control-ferrari-now-1652197657>.
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Farah, M. F., & Fawaz, R. S. (2016). A Comparison of the Influence of Personal and Cultural
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Gulf. Contemporary Management Research, 12(2), 139.
Ferrari. (2017a). Look back to the beginning. Viewed on 19th November 2017.
<http://auto.ferrari.com/en_EN/ongoing-heritage/company/history/>.
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Consumer behaviour for Ferrari
Ferrari. (2017b). Ferrari DNA. Viewed on 19th November 2017.
<http://corporate.ferrari.com/en/about-us/ferrari-dna>.
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