Gm Saturn Case Study

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GM Saturn Case Study
Ron Rubinstein
Strategic Marketing Management course
NYU SCPS – Fall 2005
Key Issues
How (whether) to revive a faltering brand after impressive initial success in early 90s. How to regain competitive advantage after loss of momentum, and failure of initial business strategies to sustain long-term sales growth. How to penetrate wider demographics (younger, male) How (whether) to penetrate foreign market

Key findings: Environmental/General
Saturn developed by GM as a separate brand and independent subsidiary in the late ‘80s, to deal with shrinking domestic market share for passenger cars: •from 44% to 33% between '85 and '90

•42% of buyers didn't even consider buying GM
•Main competition were compact Japanese cars, due to perceived higher quality and value. Factory was established in Spring Hill, TN, to isolate from Detroit mentality Key strategy to ensure quality: maintain good labor/management relations through cooperation with UAW in all aspects of business.

Key findings: Product Strategy
Initial concept: Compact, high-quality cars:
•SC1, SC2 coupes
•SL1, SL2 sedans
Technology innovation, e.g. plastic bodies
Target Market:
•Demographics: baby boomers, college educated, 25-49
•Sell 80% to "Converts" (wouldn't otherwise buy GM)
Larger vehicles were added later:
•SW1, SW2 station wagons (1993)
•L-Series mid-size sedan and station-wagon (1999)
•VUE SUV (2001)
Key findings: Promotion Strategy
Unique, "folksy", "straight-talk", $100M+ consumer ad campaign, building a focused brand image, using themes such as: •Saturn employees' enthusiasm, and dedication to building cars "in a brand new way" with US can-do spirit. •Saturn buyers' lifestyles, playing up baby boomer themes of utility, value and safety. Brand focus strengthened by using model numbers (not names), and calling dealerships "Saturn of...
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