Mercedes Benz and Its Current Marketing Strategy

Mercedes-Benz is profitable inside its market niche, but its market share has been eroding because of competition from European businesses as well as from Japanese companies. Mercedes-Benz has recently faced powerful competition from Lexus and Infinity, that are luxury car brands marketed by Toyota and Nissan through a separate dealer network in the companies' traditional vehicle offerings. These cars, which compete with Mercedes-Benz lower-end vehicles are priced lower than Mercedes-Benz products, but provide strong perceived significance for ones dollar. The result is that Mercedes-Benz has had to reconsider its advertising and marketing strategy and find new ways to expand its industry share given this new and successful competition.

In a surprising move, Mercedes-Benz announced in late 1993 that it would begin making a sports utility vehicle, the very first this kind of addition for the company's merchandise line. The vehicle will be made during the United States, the very first item by Mercedes-Benz to not be imported. The business expects to create 60,000 units at its Alabama plant commencing in 1997, and will export a number of these vehicles to the company's traditional European as well as other markets.

The sport utility vehicle, as yet unnamed, will continue the company's commitment to product cycles of at least eight years. Such lengthy cycles are perceived by the business as offering much better safety, high quality and technical features, and assist maintain.

 

This segmentation means that the company can continue to use the varieties of media (print and television) that it has utilized from the past, but it is going to now be purchasing in various vehicles inside individuals groups. For example, Mercedes-Benz may discover that sports programs on television provide a powerful marketing base, as will sports magazines. Though the vehicle will appeal to conventional Mercedes-Benz buyers, it will also appeal to shoppers who would not otherwise be interested in Mercedes-Benz. As being a result, the company should use periodicals and programs that it has not employed during the past in order to achieve the broadest relevant audience.

Mercedes-Benz is targeting buyers during the 25-40 year-old range, and anticipates that its modern dealer network should be in a position to adequately address the needs of these buyers. Look for conducted by the company reveals that 90 percent of Mercedes-Benz clients already very own similar vehicles, and that most of the pay for of Mercedes-Benz items are a couple of and three car households. Being a result, the company is going to be pursuing people customers who are replacing sport-utility vehicles instead of people who are creating the invest in decision for your first time.

Mercedes-Benz also plays down the idea that it sells German cars. Its vehicles are built in 47 countries, although the sport utility factory in Alabama may be the first American plant. The business believes in promotion "German engineering," an notion that may be put across in its promotional material, rather than in "German cars." The sports utility vehicle is expected to have 70 percent American components, which creates it much more American than German in terms of its materials, but the business will position it as German-engineered, building on a company's status in that area.

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