Fiat Stilo

Problem Statement:

Fiat wants to re-launch their brand image in Spain, which has been highly damaged during the last decade. Fiat Auto Espana must come up with a marketing plan for the FIAT STILO model that enables them to gain position in the current market.

Situation Analysis: The facts below and others are also summarized in a SWOT analysis in Exhibit 1.

Company (PSI)

• Bad perception.

• Loss of market share.

• Management conflict.

o Sales wants to improve market share first and then improve profitability little by little.

o Marketing wants to improve profitability first and then market share.

• Changes happening.

o Dealerships are an example.

• Have been unsuccessful in trying to improve brand image.

• Large company, resources available.

• HQ based in Italy.

• Experienced company.

Customers

• Perception: Low quality, Small Vehicles.

• Market moving to mid segment.

• Buyers demand more features.

• 80% of buyers in the C segment are male.

• Generally middle class.

• Mainly 2 vehicles per household.

• Commonly live in cities.

• Use vehicles to go to work.

Competitors

• Aggressive marketing campaigns.

• Golf & Peugeot = High value.

• Weaknesses:

o Features.

o Design.

• Strengths:

o Price.

o Prestige.

o Technology.

Context:

• Company unable to improve brand image, hence loss of market share for the past years.

• Brand image in Europe more prestigious than in Spain.

• Segment C estimated to keep growing.

Alternatives:

Option One: Attack the male market.

This strategy focuses on the 80% of the market in segment C, that belongs to male buyers. It is also important for this strategy to sub-segment into 3-door car buyers, and 5-door car buyers.

PROS CONS

• Give a customer what they desire.

• Customer based marketing.

• Segmentation, not Mass marketing.

• Product differentiation.

• Largest part of segment C. • High competition.

• Low buying power.

• Offers little change.

Option Two: Attack the female market.

Create a marketing campaign focused on the female market. They currently represent 20% of the market share, which means that their needs are not being satisfied. There will be a sub-segmentation to differentiate the 3 and 5-door car buyers.

PROS CONS

• Attack an unattended market.

• Satisfy the customer’s needs.

• Customer based marketing.

• Segmentation, not mass marketing.

• Less competition.

• Product differentiation.

• High buying power for customers.

• Not influenced by past Fiat experience. • Women might not be interest in a larger share of segment C.

• Forgetting about the male market (current majority of buyers).

• Might not be cost efficient.

• Risky