Ford Ka Case

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1. What is your opinion of Ford’s strategy (up to and including the development of the Ka) in the small car market in France? i) Ford made its presence in small segment car (less than 390 cms) with its Ford Fiesta model which was one of the top 5 selling cars in small segment in France and top 3 in Europe. ii) With market getting highly segment and competitors’ move to come up with models as per requirement of highly fragment segment made Ford to decide to come up with new model to target emerging segment Trend-B market. iii) Renault was the first to move to target this emerging segment with Twingo model, which took every one with surprise and it was well accepted by the segment. They offered more forcing competitors to offer more than basic transportation. To respond to this competition Ford decided to come with Ford-Ka model to compete in the same segment as Twingo iv) In response to develop the car quickly with low turn over time and development cost, Ford decided to manufacture Ka with the chassis of old Fiesta model, which proved economical but hindered the technical innovation. v) Twingo had changed perception of people to what to expect from a small car, so Ford even though challenged to be a spacious car, it was not perceived by consumers, according to whom Ka was just spacious in look from exteriors but not interiors. vi) Ford’s Ka could not communicate strongly the message to the target consumer. Consumers were confused with the positioning of the car. Due to lack of strong communication message it lead to a distorted perception of Ford Ka’s image in consumers’ mind. vii) Ford also went back to sell older version of Fiesta in the segment of small cars when it could not catch up with the increasing demands of highly fragmented consumer base and with competition catching up competitors were providing more for value of money of consumer. Ford was a bit late to react to this and hence lacked to capitalize in the segmented market. viii) From the case it is relevant ford was never firm with decision, they were always in Yes-No situation, which cost them a lot as they were never made firm move to capitalize the segment market. This set of approach also led ford to make hasty and wrong decisions.

2. What were some of the major car-buying dimensions that emerged from the psychographics study? The data are provided in the Ford Ka Psychographics file posted on TLE. Perform a factor analysis on the answers to Questions 2, 10, 5, 12, 39, 40, 46, 48, 54, 57, and 58 and interpret the results. Include labels for the factors that emerge.

* After performing factor analysis on the given set of questions we analyzed that 76% of the psychographics data is covered by top 4 components. After analyzing the four factors, the following conclusions can be made * The first factor can be categorized as ‘fashion/trendy’. It shows that design, image and looks of the car are important. * The second factor can be categorized as ‘Compact/Size’. It depicts that size of the car is one of the important factor. * The third factor can be categorized as ‘Individualistic/Character’. It shows that car is taken as symbol of character to depict independence/freedom. * The fourth factor can be classified as ‘Economic/Reliability’. It shows economic car which is reliable plays an important role in factoring the given data. * After performing rotation factor analysis the results were very similar showing same trend. 3. Based on the psychographics data, are there distinct attitudinal segments? Perform a cluster analysis on the attitudinal response data (Questions 1 through 62 in the data file) and interpret the results. Limit your analysis to solutions with four clusters. Provide your own names and brief descriptions for any clusters that emerge. * After running cluster analysis with 4 clusters we can see in the result there are definitely distinct attitudinal segments according to the...
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