GM Saturn Case Study
Strategic Marketing Management course
NYU SCPS Fall 2005
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
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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