An Analysis of Ford's Marketing Strategies and Porter's Five Forces

This assignment involves analyzing Ford's marketing strategies and applying Porter's Five Forces to understand the competitive landscape of the automotive industry. The analysis includes an examination of Ford's marketing mix, including product, price, promotion, and place (4 Ps) as well as additional elements such as people, process, physical evidence, and performance (7 Ps). Additionally, it explores the five forces that shape competition in the industry, including threat of new entrants, bargaining power of suppliers, bargaining power of buyers, threat of substitute products, and competitive rivalry among existing competitors. The assignment also includes references to relevant studies and publications on marketing strategies and Porter's Five Forces.

FORD COMPANY
REPORT

Table of Contents
INTRODUCTION...........................................................................................................................3
Company overview.....................................................................................................................3
Competitive advantage................................................................................................................3
Marketing mix ............................................................................................................................5
RECOMMENDATIONS.................................................................................................................8
CONCLUSION................................................................................................................................8
REFERENCES ...............................................................................................................................9

INTRODUCTION
Ford Motor Company is an American multinational auto-maker and it has it's headquarter
situated in Dearborn, Michigan. The organisation is selling commercial and auto mobile vehicle
under the brand name of Ford. Under this report the organisation porter five force model have
been used in order to analyse the the organisation competitive environment. Along with it
marketing mix of the company is being also highlighted in order to hoe business influence
consumers to purchase their products. Later part of the report deals with recommendation that
can be adopted by business in order to maintain competitive advantage.
Company overview
Ford motor company was incorporated in the year 1919, it is a global automotive
company. The organisation's business currently involves designing, manufacturing servicing
and marketing of lines of ford trucks, cars and Lincoln luxury vehicle. The business operates in
four different segments such as central treasury operations, financial services, Ford smart
Mobility LLC and automotive. The business automotive segments includes sale of Ford and
Lincoln vehicle, accessories and parts all across the globe. In the financial service segment the
business provides vehicle related financing and leasing. Under the central treasury operations the
business is engagement in taking decision related with investment, risk management and it also
involves providing finance fro their automotive segment Where as the Ford smart Mobility LLC
is responsible to design, build and invest in emerging mobility services (Grant, 2016).

Source:Ford car market share in the United Kingdom (UK)
The above graph depicts that UK market share of Ford had a range between 9.31 and
14.91 percent. That shows that the organisation have consistently controlled a high portion in the
car segment of the UK car market. It has maintained as one of the leading car brands in the UK
(Ford car market share in the United Kingdom (UK) from January 2016 to January 2019)
Competitive advantage
Ford motor company is maintaining position of biggest auto mobile manufacturer across
the globe by continuously restructuring their strategies in order to address the issues in the
environment. The porter five force model was developed by Michael Porter in order to analyse
the external factors that effect the functioning of the organisation. Ford have to develop policies
and strategies in order to respond to these forces or factors which comprise in the external
environment of the automotive industry. The five force assists in identification of the external
Illustration 1: Ford car market share in the United Kingdom (UK)

factors and also examine their impact on the businesses (Wesseling, Faber and Hekkert, 2014).
The factors of Porter's five force model can be elaborated below-
(Source:Porter's Five Forces, 2018.)
 Competitive rivalry: It comprise of the current number of competitors that exist in the
marketplace. Ford faces tough competition in the auto mobile industry by the major
competitors such as Volkswagen, General motor and Toyota. Due to this competitor it is
difficult for the business to maintain their market share. As the company offers product
which comprises of high quality they are bale to respond to these competitive pressure
from the other competitors. in order to deals with such competition Ford have decide to
develop electric vehicle in order to address the current trends which focus on creating
environment friendly cars (Colmorn and Hülsmann, 2014).
 Threat of substitute products: Ford is facing a moderate level of threat from the
substitute products. The substitute products available in the industry comprises of
various mode of transportation such as bicycle and public transport and offer of other
manufacture related with alternative manes of travel and are a threat for the business. The
switching cost for the Ford product are moderate their customers can shift and prefer to
use substitute products but this cannot be done in case if they are still bound by their car
loans. In may cases these substitute have low performance in comparison with the Ford
products that is why organisations quality and deign can serve as an decisive factor in
Illustration 2: Porter's Five Forces

terms of selecting a substitute. The ford have always focussed on providing quality in
their product which have helped them to get a edge over other substitute products.
Therefore the threat of substitute is moderate (Stringham, Miller and Clark, 2015).
 Bargaining power of supplier: Suppliers have moderate level of influence on Ford
motor company. Supplier who are supplying raw material to auto-mobile companies have
to offer a competitive price to the buyers in order to ensure a their long term agreement
with buyers. Along with it buyer do not have control on pricing as supplier can back out
from the agreement and they can further associate with other competitors. The large scale
organisation can be benefited by reducing the bargaining power of supplier but the
amount of supplier in the market can effect and strength the position of suppliers in the
industry. Which results in moderate level of bargaining power of suppliers (Gadde,
2014).
 Bargaining power of Buyers: As the business is offering their product to customers all
across the globe. The buyers can have influence on the company's price to some extent
which in turn will effect the profitability of the organisation. Due to the moderate level of
bargaining power of customers the company is able to make changes in their price
decisions but they cannot introduce a significant rise in their price as they have to
maintain vehicle demand in the market (Sun and Liang, 2014).
 Threat of New entry: It involves the emerging business that tent to join the industry.
The company faces a low level of threat of new entry as entering in auto mobile industry
involve high barriers that is because of the high amount of capital investment that will be
required to purchase auto parts and in managing the production lines. As the ford already
have a global presence and invested a significant amount in order to keep their product
supply smooth. New entrant not be able to find it easy to match the effectiveness unless
they manages to acquire capital in order to reduce the entry barriers (Shalender and
Singh, 2015).
Marketing mix
Marketing mix depict a group of marketing variables that the business uses in
combination and controls in order to produce the desired responses in their target market. It is a
key tools which comprises of different elements that Ford uses in order to influence the demand
for their product offering. The elements of Ford marketing mix can be further elaborated below-

Illustration 3: THE MARKETING MIX
\
(Source: THE MARKETING MIX. MARKETING THEORIES – THE MARKETING MIX –
FROM 4 PS TO 7 PS, 2019)
 Product- Ford offers variety of product and services all across the globe their main
product line involves selling products such as trucks, buses, tractors, automotive parts,
vehicle financing and Financial services. They are highly popular in the market for their
auto mobiles such as sedans. The Ford motor credit company is Ford's subsidiary which
is involved in offering financial services to their customers. The company also provide
vehicle leasing to their corporate clients. They focus on maintaining quality in their
product and services in order to maintain their customer base (Paul, 2018).
 Price: The business uses a varied pricing strategy which is focussed on maintaining their
competitive position in the market along with catering the different customers segments.
As the company is selling their products all across the globe they have a large customer
base. In order to maintain the customer base they tent to provide furl efficient and
average price vehicle in order to cater the customers along with it they provide luxury
cars as well in order to cater higher end consumers. They have produced Lincoln vehicle

in order to attract customer who desires luxury product and product with latest
technology (Shank and Lyberger, 2014).
 Promotion: Ford spends high amount in promoting their product and services. The brand
uses modes such as auto shows in order to showcase its product to customers. It has also
been suing different channels such as digital and traditional channels in order to
showcase their product and services. Which involves using television advertising and
print adverting and also involves innovative channels such as online advertisement and
social media . As the current market is highly competitive and competitors have been
adopting various promotional tools in order to gain more market share effective use of
promotional tolls are helping the organization to retain their position in the market (Paley,
2017).
 Place: Ford is selling its' product ans services to customers all across the globe. It sold
approx 6.607,000 at wholesale in the global market. The company sues distributors and
dealership in order to sell their product in the market place. In 2017 the number of
dealership range approx 11,428 and the range of Ford dealership was approx 10,345. The
wholesale represent the product that are being sold to their dealers. Whereas the retail
sells depicts the product that have been sold to customers by wholesaler and dealers.
They have designed their Ford and Lincoln stores in order to provide complete customer
experience to their customers. They have designed their stores in a way so that they can
provide stop solution to all their problems related to maintenance and repairs (Ford
Motors Marketing Mix. 2018).
 People- A business success depend upon their workforce as they are responsible to
perform and achieve organisational goals and objectives. Ford invest in providing
training and development programme to their employees which comprise of company
looking into their employees nurturing skills and talent and then enabling training and
development programme in order to enhance their current skills as this will help them to
impart new skills into their workforce which will help the business to perform better in
the market place.
 Process- This element involves flow of different activities which results in delivery of
services to customers. Ford sells their product through dealers customer can locate dealer
near them by using online modes. Then the sale take place in one of their dealership

location. This help the consumer to book appointment and they can also take test drive of
the vehicle that they want to purchase and the finally buying it from dealers.
 Physical evidence- This element involves ambience which is surrounding of where the
exchange of goods or services is going to take place. Ford have designed their stores in
such a way that they provide one stop solution to all the customers problems such as
problems related to repairs and maintenance (Naik and Peters, 2015). They have
established their stores in different locations across the globe so that customers can by
their product and service easily.
RECOMMENDATIONS
It is suggested that the company produces more of hybrid and electric cars because the
society is focusing on adoption of eco-friendly cars and in order to please the society the
organisation have to fulfil the needs and wants of customers so that they can increase their
satisfaction level and can also increase customer base. It will also help them to influence
customers on large scale as electric cars will help them to reduce their vehicle impact on the
environment and by making customer realise the same they will be able to attract larger number
of audience. whereas hybrid cars runs cleaner and has better gas mileage this advantage can be
highlighted to customers in order to influence their buying behaviour.
CONCLUSION
From the above report it can be concluded that Ford Motor company is an automotive
organisation that deals in selling products such as trucks, buses and cars. There are various other
competitors that are giving tough competition to the organisation such as Volkswagen and
General motor. In order to compete in the market they have designed there marketing mix in an
efficient manner so that they can influence their customer. Further, they can focus more on the
production of hybrid and electric cars in order to influence the behaviour of customer to a higher
extent.

REFERENCES
Books and journal
Armstrong and et. al.,2014. Principles of marketing. Pearson Australia.
Colmorn, R. and Hülsmann, M., 2014. Strategic perspectives for electric mobility: some
considerations about the automotive industry. In Evolutionary Paths Towards the
Mobility Patterns of the Future (pp. 155-168). Springer, Berlin, Heidelberg.
Gadde, L.E., 2014. Strategizing at the Boundaries of Firms. IMP Journal.8(3).
Grant, R.M., 2016. Contemporary strategy analysis: Text and cases edition. John Wiley & Sons.
Majaro, S., 2014. Marketing in Perspective (RLE Marketing). Routledge.
Naik, P.A. and Peters, K., 2015. True synergy for real effects: How to control integrated
marketing successfully. GfK Marketing Intelligence Review.7(1). pp.34-41.
Paley, N., 2017. How to Develop a Strategic Marketing Plan: A step-by-step guide. Routledge.
Paul, J., 2018. Toward a'masstige'theory and strategy for marketing. European Journal of
International Management.12(5-6). pp.722-745.
Shalender, K. and Singh, N., 2015. Marketing flexibility: Significance and implications for
automobile industry. Global Journal of Flexible Systems Management.16(3). pp.251-
262.
Shank, M.D. and Lyberger, M.R., 2014. Sports marketing: A strategic perspective. Routledge.
Stringham, E.P., Miller, J.K. and Clark, J.R., 2015. Overcoming barriers to entry in an
established industry: Tesla Motors. California Management Review.57(4). pp.85-103.
Sun, S.L. and Liang, H., 2014. Morphing: The linkage of inward private equity and outward
ventures. Thunderbird International Business Review.56(5). pp.421-438.
Wesseling, J.H., Faber, J. and Hekkert, M.P., 2014. How competitive forces sustain electric
vehicle development. Technological Forecasting and Social Change.81. pp.154-164.
Online-
Ford Motors Marketing Mix. 2018. [Online] Available through:<https://notesmatic.com/ford-
motors-marketing-mix/>.
THE MARKETING MIX. MARKETING THEORIES – THE MARKETING MIX – FROM 4 PS
TO 7 PS. 2019. [Online]. Available Through:
<https://www.professionalacademy.com/blogs-and-advice/marketing-theories---the-
marketing-mix---from-4-p-s-to-7-p-s>.
Porter's Five Forces. 2018. [Online] Available Through:
<https://www.strategicmanagementinsight.com/tools/porters-five-forces.html>.
Ford car market share in the United Kingdom (UK) from January 2016 to January. 2019.
[Online] Available through : <https://www.statista.com/statistics/300423/ford-car-
market-share-in-the-united-kingdom/>.