Consumer Behaviour and Marketing Psychology Report

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INDIVIDUAL REPORT
Consumer Behaviour and Marketing Psychology

Table of Contents
EXECUTIVE SUMMARY...................................................................................................................3
OVERVIEW OF GOLF 110TSI...........................................................................................................4
CRITICAL ANALYSIS........................................................................................................................ 5
STRATEGIC RECOMMENDATIONS..................................................................................................9
REFERENCES.................................................................................................................................11
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EXECUTIVE SUMMARY
This assignment is prepared to develop an understanding as well as the application of different
concepts and theories of consumer behaviour in order to present a strategic recommendation.
A case scenario of Golf 110TSI Volkswagen is utilised in this report in order to critically analyse
the current marketing strategy and marketing communication mix of Volkswagen. It will
determine the alignment of current marketing focus with the consumer behavioural factors. At
last, three strategic recommendations are provided to the board of directors
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OVERVIEW OF GOLF 110TSI
Volkswagen Australia is a wholly owned subsidiary of automobile manufacturer based in
Germany Volkswagen AG. Approximately 200 people are employed by the Australian subsidiary
which is administered from its head office in New South Wales (Volkswagen, 2017). The
principal activities of the company include driving revenue from import as well as the
distribution of new as well as pre-owned cars, parts and accessories of all Volkswagen models
along with merchandise and finance options and car service centres.
Golf is a model that has three variants that are comfortline, highline and trendline with body
style hatchback and wagon. It has five doors. The price ranges between $25,000 and $37,000.
The engine size is 1.4 l with fuel consumption of 5.4 l per 100 km. it has 7 airbags for the safety
and security of the passengers. Its engine configuration is in-line with engine type piston. The
generic gear type is automatic with 7 gears (Volkswagen, 2019). The warranty in years from first
registration is 5 years with warranty anti-corrosion from first registration is 12 months.
Approximate running costs include fuel cost of $104 per 1000 km while fuel cost $95 per fill.
The power to weight ratio is 87.2.
It has 16-inch alloy wheels and has a high-resolution 8.0-inch colour touchscreen with Apple
CarPlay or android auto connectivity taking centre stage. It has a leather-wrapped steering
wheel vanity mirror lights and auto-off headlights and safety technology with autonomous
emergency braking (Volkswagen, 2019). It has standard equipment including power windows
and mirrors, keyless entry, manual air-conditioning, cruise control, cloth trim auto-off
headlights and leather-trimmed steering wheel as well as gearshift. It has power ranges
between 92 kW and 110 kW for all 1.4-litre turbo 4-cylinder models with torque going from 200
Nm to 250 Nm with no extra cost over the pre-facelift Mark 7 generation.
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CRITICAL ANALYSIS
CURRENT MARKETING STRATEGY
The current vision of Volkswagen is to be the leading provider of sustainable mobility across the
world. the strategy of Volkswagen for tomorrow's growth includes the launch of future
program TOGETHER- strategy 2025 focusing on dimensions such as excited customers, excellent
employer, competitive profitability and role model for safety, environment and integrity
(Volkswagen, 2017). The company focuses on the diverse needs of the customers as well as on
customised mobility solutions with the aim of exceeding the expectations of the customers and
generate maximum benefit for them.
The strategy by Volkswagen does not include concentration on just best products, best services
and most efficient solutions but also on outstanding image and flawless quality. The KPIs of the
strategy includes variable such as conquest rate, loyalty rate or conquest breakdown
(Volkswagen, 2017). The strategy is focused on exciting the present consumers along with
winning new customers in order to retain their loyalty for the long run (East et al., 2016). In
order to cater to the needs of the customer, the segmentation variables such as demographic,
psychographic and geographic are used by Volkswagen.
Differentiated targeting strategy is used by Volkswagen to offer specific products to specified
customer segments of different group brand. The sale and marketing strategy of Volkswagen
aimed at using the slogan “customer delight” to excite the customers on a whole new level. The
top priority is to sustain customer loyalty to the company’s brand and recommend their
products as well as services to others (Volkswagen, 2017). The company also value the
emotional connection to the company’s brand. Conquest rate, loyalty rate and net promoter
score are three strategic indicators to measure the success of retaining customers and winning
new ones.
MARKETING COMMUNICATION MIX
The aim of the marketing communication mix is to market the golf model grounded on the core
value of Volkswagen as it helps in influencing the attitude and behaviour of the customers.
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Contrary form the current marketing strategy, it is more effective in attracting customers’ inner
self resulting in an impact of their purchase decision (Kass, 2018). Advertising through
Television and print media create greater appeal towards the golf model as the psychographic
profile of the target market value trusted and familiar brands. Also, online advertising includes
SEO which can be used to direct the online traffic towards the website of Volkswagen and
maximise the advertising coverage cost-efficiency.
Social media forms interactive marketing that serves as engagement tools as well as creates
two-way communication to stimulate the customers' interest and drive the golf awareness by
building an emotional connection between consumers and Golf model. Sales forces and
company dealer involve in personal selling addresses customers' uncertainty so as to stimulate
the decision to purchase a golf model (Schlegelmilch, 2016). It helps in building effective
personal experience by creating desire brand image as well as influence purchase decision.
Public relations develop the golf towards the desired positioning in the market whereas
building a good market relationship.
ALIGNMENT OF CONSUMER BEHAVIOURAL FACTORS AND CURRENT MARKETING FOCUS OF
VOLKSWAGEN
The data analysis from the survey in the previous assessment identified the purpose of
purchasing the car and different factors taken into account in selecting the car. It is essential
for the marketers of company Volkswagen to identify and understand the requirements and
needs of prospective customers (Wang& Wanjek, 2018). According to Freudian Model of
Human Behaviour, the psychological forces that shape the behaviour of the customers remain
unconscious which means that individuals may not be able to fully understand their own
motivations. The company Volkswagen prepare an effective marketing mix in order to satisfy
the needs and wants of potential customers by understanding the laddering technique.
Laddering technique is a market research technique that can be used by marketers of
Volkswagen to collect information about the needs and motives of the consumers (Arli &
Tjiptono, 2018). It helps the marketers of Volkswagen to the reactions of consumers to the
overall strategy of the marketing mix. According to Maslow's theory, the marketers of
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Volkswagen golf must find the best solution of persistent needs as well as problems tackled by
the consumers in order to provide the right product at the right moment to the market (Simkin
et al., 2018).
The factors that are majorly concerned by consumers ranges from most important to least
important that are safety, make, price, look, features, running costs and endurance or reliability
which are the most basic psychological and physiological needs are provided by Volkswagen
golf to consumer (Homburg et al., 2017). These factors act as satisfiers and ensure the likeliness
of the consumer to purchase Volkswagens’ Golf 110TSI. Self-esteem is majorly associated with
owning a car and may also fulfil the other needs that are belongingness to other individuals
with the car in society.
The marketers of Volkswagen ensure that the satisfaction of consumers’ needs as it helps in
creating motives to purchase through motivators such as cost, quality and efficiency of cars
being purchased (Price et al., 2015).
According to Marshallian Economic Model, income will be spent by the individual buyers on the
products that offer the greatest satisfaction which depending on their taste, needs and relative
prices of products. As it is observed that price is one of the concerning factors of the customers
while buying the car. The common denominator of psychological needs is money which is used
by Marshall where the equation and comparison of the needs are considered in terms of costs.
The people who undertook are survey preferred safety while buying a family car and others
preferred price and make for buying a work car (Homburg et al., 2017).
The choices to buy the product are impacted by economics and it has the power to change the
choice of the customers in product purchase which is affordable. The people with low-income
range compare reliability and endurance while the people with high-income range majorly
focuses on look, features and make of car.
The role of reference groups is very critical in achieving the personal goal as well as the mutual
goals of the reference group members as per the Veblenian social-psychological model (Price et
al., 2015). The first reference group is a primary or regular group which includes family, Friends
and co-workers. These are the people who make a big influence on the decision making of the
car. A second reference group is a secondary group such as car reviews and company website
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for consultation before purchasing a car. The lifestyle and buying behaviour of the consumers
is determined by the present group memberships
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STRATEGIC RECOMMENDATIONS
One of the strategy recommendations is to focus on a product that is Volkswagen golf.
Volkswagen golf model has different variants with body style which gives the chance to
prospective consumers to select the car from different size and varied technologies based on
the required specifications.it is recommended to marketers of Volkswagen golf to define the
specifics as well as quality of consumer care services along with the exceptional quality of
Volkswagen golf cars to get higher chance of returning customers (Ramanathan et al., 2017).
The products designs and features of golf care model must be highlighted to satisfy the
consumers and also give choice to tailor-make the cars.
This helps in gaining a competitive advantage over other products in other automotive
companies. Security assurance must be highlighted as it offers 7 airbags by Volkswagen golf;
also warranties in years of 5 years are available for consumers when buying the cars. Cost-
effectiveness in buying a sustainable item can be used by the Volkswagen Company for
attracting consumers (Ramanathan et al., 2017).
Another strategic recommendation is to determine the price of the car. The entire marketing
strategy of Volkswagen needs to determine price balances as it depends on the economic
situation, competitors pricing, company considerations, profit projection, production costs and
demand of golfs cars. Discounts and allowances can be given to the consumers to own cars at
lower prices. It can also be recommended to Volkswagen to allow the consumer to purchase
the golf model of Volkswagen by pay instalments while considering the payment periods which
are placed in relation to hire purchase rates and payment rates (Helm et al., 2016).
It should focus on the effectiveness of the channels of distribution enabling the movement of
cars from manufacturing plants to the market. Either of zero level, one-level or two-level of
channels of production must be adapted to deliver the cars to the customers (Nguyen et al.,
2018). It is recommended that information must be given to consumers by dealers and retailers
using sales promotions through commission for sales, discount offers, test drives, gifts and
special offers.
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Effective promotions must be focused by Volkswagen to ensure the brand awareness and brand
image of Volkswagen Golf. The target customers can be persuaded by advertising through non-
personal presentation such as television to buy the Volkswagen Golf. A large number of
customers can be targeted by using videos and pictures on the online community (Nguyen et
al., 2018). Different social media platforms and sites must be used in order to reach a large
number of people in a limited given time. Using social media for promotion is economic for
advertisement as compared to other media. An Official space can be provided by Volkswagen
website in order to place any offers to acquire information for customers.
Favourable publicity can be obtained by the public relation managers through socially
responsible activities to reach a good number of target markets. It is essential to use direct
marketing in order to communicate about the product to the target market (Helm et al., 2016).
Major focus can be given to face-to-face communication among marketers and potential
consumers. Although it is time-consuming as well as expensive method, it is one of the most
effective methods for marketing the product.
The market and marketing strategies are driven by the needs, wants and expectations of the
customers. The purchasing decision of the customer can be influenced by pricing, product, and
place and promotions, therefore it is essential for the marketers of the company such as
Volkswagen to understand the needs and behaviours of the customers and make changes in
their marketing strategy (Nguyen et al., 2018). This helps them achieve increased sales and
access to a large customer base.
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REFERENCES
1. Arli, D. I., & Tjiptono, F. (2018). Consumer ethics, religiosity, and consumer social
responsibility: are they related?. Social Responsibility Journal, 14(2), 302-320.
2. East, R., Singh, J., Wright, M., & Vanhuele, M. (2016). Consumer behaviour: Applications
in marketing. Sage.
3. Helm, S. V., Renk, U., & Mishra, A. (2016). Exploring the impact of employees’ self-
concept, brand identification and brand pride on brand citizenship behaviors. European
Journal of Marketing, 50(1/2), 58-77.
4. Homburg, C., Jozić, D., & Kuehnl, C. (2017). Customer experience management: toward
implementing an evolving marketing concept. Journal of the Academy of Marketing
Science, 45(3), 377-401.
5. Kass, B. (2018). Book Review: Consumer Behavior.
6. Nguyen, D. H., de Leeuw, S., & Dullaert, W. E. (2018). Consumer behaviour and order
fulfilment in online retailing: A systematic review. International Journal of Management
Reviews, 20(2), 255-276.
7. Price, R. A., Wrigley, C., & Straker, K. (2015). Not just what they want, but why they
want it: Traditional market research to deep customer insights. Qualitative Market
Research: An International Journal, 18(2), 230-248.
8. Ramanathan, U., Subramanian, N., & Parrott, G. (2017). Role of social media in retail
network operations and marketing to enhance customer satisfaction. International
Journal of Operations & Production Management, 37(1), 105-123.
9. Schlegelmilch, B. B. (2016). The Future of Global Marketing Strategy. In Global
Marketing Strategy (pp. 221-249). Springer, Cham.
10. Simkin, L., Japutra, A., & Ekinci, Y. (2018). Positive and negative behaviours resulting
from brand attachment: The moderating effects of attachment styles. Journal of
Marketing, 52(5/6).
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11. Wang, Y., & Wanjek, L. (2018). How to fix a lie? The formation of Volkswagen’s post-
crisis reputation among the German public. Corporate Reputation Review, 21(2), 84-
100.
12. Volkswagen, (2017). ANNUAL REPORT 2017 SHAPING THE TRANSFORMATION
TOGETHER Sales and Marketing (Online) available at
https://annualreport2017.volkswagenag.com/group-management-report/sustainable-
value-enhancement/sales-and-marketing.html Accessed on 4th June 2019
13. Volkswagen, (2019). Choose your variant for: Golf (Online) available at
https://www.volkswagen.com.au/app/configurator/vw-au/en/golf/30316?page=trim
Accessed on 4th June 2019
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