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A Tale of Two Cars

A Tale of Two Cars
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People's car, The Mouse, The Frog, The Beetle, The Nano: What's in a name? A great deal, according to the behavioural perspective. These names conjure up images of specific types of cars, and each one of these names has a story to tell about the car itself and the people driving it. Both these car names are symbolic of where they have come from, how they were developed, and how they failed. And both these cars are indicative of the importance of marketing in the success of a new product (the new 'people's car') and the marketing downfalls of a new, very different product. Let's take a look at each of these cars individually and find out what makes them tick (or rather what doesn't!)...

Peoples' Car: Volkswagen Beetle

Volkswagen was founded in 1937 by Adolf Hitler and his close friend Heinrich Himmler in an effort to create a German "people's car" that would be manufactured efficiently at a low cost. To achieve this goal, Hitler placed a series of strict restrictions on the engineering design of the automobile to prevent outside engineers from adding or taking away any features that would increase the production costs of the vehicle. Unfortunately this resulted in a poor quality product that suffered constant mechanical problems throughout its life.

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The Volkswagen Beetle is one of the most recognisable cars in the world. Its distinctive shape has graced magazine covers and television advertisements for decades. When the first production model was released in 1938, it was an overnight sensation and a commercial success. But the initial success was short-lived. World War II broke out soon after the Beetles were released into the market. As a result, sales plummeted as Germany invaded other countries and began producing its own cars. After the war, the Beetle became a prized commodity among German consumers, who had experienced first-hand how dangerous and unreliable foreign cars were during the war. With the threat of war no longer looming over them, Germans were willing to buy a car from a German company once again, and they flocked to VW dealerships in droves to purchase the new Beetles. Sales skyrocketed again, and the Beetle became the best-selling car in Germany for many years. This post-war resurgence in the market only came to an end with the oil crisis of the 1970s. The price of gasoline soared, and the German economy suffered as a result. Once again, sales were slow, and sales began dropping off rapidly in the early 80s.

Production of the Beetle continued but sales continued to decline until the company was forced to discontinue production of the Beetle in 2003 due to declining demand and the fact that the cars were no longer being produced with modern safety features such as airbags. Although it has become less popular over the years, it still remains one of the most iconic cars in the world.

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A People’s Car – Tata Nano: Initial Buzz Turned into Firestorm and Fluctuating Sales

The Nano was a car that was supposed to reflect the aspirations of Indian people and change the way Indians commuted. It was marketed as a 'people’s car' that would revolutionize the way people moved in the country. The company showcased the car as a symbol of social and economic progress that was necessary for the success of the country. The car was supposed to be affordable to an average middle class family and make it easier for them to own a vehicle. However, the reality was quite different from what the company portrayed it to be.The reality was that the people were not really interested in buying a Nano because it was not well suited to their needs.

There were a number of reasons for this failure including the delay in production, high fuel consumption, poor safety features, poor quality of the interiors and low customer acceptance. As a result of the poor sales of the Nano, the company incurred significant losses and had to scrap the entire project. Despite all this, the Nano captured the imagination of people in India and is still considered a landmark event in the Indian automobile industry.

Consumer Choices affect Social Perceptions - Beetle vs Nano

The consumer choice of automobile influences how society perceives the person driving the vehicle. This is evident in how people reacted to the Nano when they found out that it was a ‘people’s car’ designed for the common man. The emphasis on the lower price of Nano backfired because it weakened the social image of the owner, who was considered rich enough to afford a car but not wealthy enough to be able to afford a quality car. Thus, resulting in reduced purchase intentions.

The image of the average Nano driver was different from the image of the typical owner of a Beetle. In the case of the Beetle, the driver was considered to be aspirational. In contrast, the person who drove a Nano was considered to be he could not afford to buy a car of better quality. This resulted in a lower social image and reduced purchase intentions of the customers.

These differences in social perceptions were due to the fact that consumers choose cars that suit their lifestyle and according to market research this was why most people in India were not interested in buying a Nano. The company had been successful in portraying the car as the people’s choice but the reality of the situation was quite different.

A car is more than a bundle of functional benefits. The transition from a two- wheeler to a Four-wheeler vehicle is an essential milestone for the burgeoning middle class in India. Some admire the new car while others envy the owner's transition up the social ladder. A consumer with low income would be constrained by a smaller budget but within that small budget, he or she seeks to maximise the social benefits of owning a car. In terms of social signalling, buying a Nano was not very different from buying a two-wheeler. One cannot hope to move up the social ladder by acquiring a car that has become famous as a poor person's car.

In the case of Beetle cars, people often thought of them as symbols. Owning a Beetle allowed the owner to demonstrate his or her social status and attract the attention of others. As a result, people valued Beetles much more than they did Nano's. However, by the end of the 20th century, as the middle class expanded and more people were able to afford cars, the popularity of the Beetle began to decline. This was primarily due to the rise of inexpensive foreign imports and better quality cars.

Advertising Exposure Shapes Norms and Values: Case of Volkswagen Beetle and Tata Nano in India

We are exposed to a tonne of advertisements and commercials every day through publications, television, the internet, and billboards. Naturally, they might change how we feel and think about the marketed products, which might then affect the decisions and actions we take. It can trigger behavioural change towards a brand or product. Most advertisers are aware of the power of advertising to influence consumers’ preferences in their favour, but in most cases, this is accomplished through appeals to positive emotions rather than to negative ones. Negative emotions such as anger, fear, disgust and guilt often evoke strong reactions in consumers and hence have the potential to result in a backlash if overused. This is because negative emotions are usually associated with unpleasant experiences and are therefore considered aversive or unpleasant to experience. On the other hand, positive emotion is pleasant to experience and therefore is likely to be ignored if not reinforced by advertising.

Given their different designs and varying features, we can say that it is unlikely that the two brands would have received similar levels of consumer preference in the absence of any advertising or marketing activity. This is because the consumers were exposed to different advertisements regarding both brands and the impact of these advertisements on consumer preferences differed greatly for both brands. In the case of the Tata Nano, most of the advertisements were aimed at convincing potential customers that the cars were good value for money and that they offered good fuel efficiency. The primary objective of the advertisements was to promote sales rather than establish any specific brand image for the brand. This meant that the purpose of the advertisements was different in the case of the Nano than it was in the case of the Volkswagen Beetle. For instance, while many of the advertisements for the Volkswagen Beetle featured innovative imagery, the advertisements for the Tata Nano focused mostly on promoting the car as a reliable and affordable means of transport for the common man. In short, it can be said that the advertisements for the two cars were aimed at very different target audiences and so the messages conveyed to them were also very different. This not only impacted on consumer perceptions and preferences, but it also meant that the relative success of both brands were strongly influenced by the manner in which they were marketed. This highlights the importance of effective marketing strategies for any company that wants to promote its products to consumers.

One of the primary challenges for both the Tata Nano and the Volkswagen Beetle was to establish a strong presence in their respective markets and establish a name for themselves among the customers. Both companies relied heavily on advertising and marketing campaigns to promote their products and attract new customers. Both companies also faced the challenge of developing innovative advertising campaigns that would help them differentiate their products from those of their competitors. Nano used negative advertising to appeal to the Indian middle class against perceived social ills associated with poverty, low-quality cars, and weak personal image. For instance, advertising for the "Khushiyon ki Chabi" (English: Key to Happiness) campaign appeared on well-known television networks. The campaign portrayed Nano as a car for the lower middle class, particularly families for whom owning a car was a dream, in to emphasise the idea that owning a car may help improve one's social position, and hence one's self-esteem and personal image. In contrast, the Volkswagen Beetle focused its efforts on showcasing the vehicle's unique design through various well-designed and engaging commercials.

Thus, while both the companies followed similar strategies for promoting their products, their choice of marketing strategy reflected the nature of their brands. Nano sought to build strong emotional bonds with its consumers through negative advertising while Volkswagen focussed on building a strong brand image for itself in the market by positioning the Beetle as a fun and stylish vehicle. While Beetle succeeded in establishing itself as a highly desirable product, it failed to create a value perception in the mind of the consumer. On the other hand, Nano managed to establish a value perception in the minds of its potential customers but failed to build a desirable brand image in the minds of its target audience.

It can therefore be said that the distinctive branding strategies adopted by the two companies played a crucial role in establishing them as market leaders in the entry-level segment. However, their inability to build a strong and loyal customer base resulted in the decline of their respective market shares in the long run.

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