Land Rover North America, Inc.

Topics: Four-wheel drive, Land Rover, Jeep Pages: 10 (3823 words) Published: September 18, 2007

Statement of the Problems

Taking into account the role of Discovery vis-а-vis other models in the Land Rover line, the brand's strengths and weaknesses versus formidable U.S. competitors, and potential differences in target audience perceptions of brand and category equity in the United States versus the United Kingdom, which of the three following positioning options should be introduced for the new $30,000 Land Rover Discovery:

The Definitive Family 4X4
The Evolved Land Rover or
The More Affordable Range Rover

How should Land Rover North America, Inc. (LRNA) allocate its marketing funds across LRNA brands? What should the elements of the marketing mix be recognizing the positioning decision that is recommended? What should be recommended for the company's proposed retailing strategy and experience marketing initiatives? How can LRNA successfully and profitably introduce the Discovery into the U.S. and meet or exceed its objectives?

Situation Analysis

U.S. sales of cars and light trucks totaled 15298538 units in 1993 with SUVs comprising 8 percent of the total or 1,402,558 units. Cars comprised 56 percent of the market in 1993 or 8,517,859 units with light trucks at 36 percent of the total or 5,378,121 units. SUVs are contained within the light truck category and are categorized into three categories, mini, compact and full-size, with the compact category being the largest group at 1,040,704 units or 74.2 percent of the total in 1993.


The industry as a whole is growing by 9.0 percent from 14050855 units in 1992 to 15298538 units in 1993. This growth is primarily due to the 15.5 percent growth of light trucks from 4,655,043 units in 1992 to 5,378,121 units in 1993 and within this category the 18.6 percent growth of SUVs from 1,182,699 units in 1992 to 1,402,558 units in 1993.

Technological Changes

Emissions, Fuel efficiency, Alternative power sources, Safety, Navigation devices, Legal/Regulatory Issues, Emissions, Fuel economy standards, Safety such as bumpers, seat belts and airbags, Brand and trademark development protection, Tariffs and taxes, Content of ads and commercials.

Competitive Analysis

The top three competitors, Jeep, Ford, and Chevrolet, comprise 73.6 percent of the total SUV market:

Jeep, with its two Cherokee and Grand Cherokee vehicles, lead the compact SUV category sales at 338,007 units or 32.5 percent of the total. After adding in the Jeep Wrangler, Jeep unit sales in 1993 totaled 403,655 units or 28.8 percent of the total SUV market. The Jeep Grand Cherokee had the highest ad recall of 46 percent and an overall opinion at 80 percent, tied with the Ford Explorer, when compared to major SUV brands. In 1994 Jeep spent $105.3 million in advertising with a $67.8 million advertising budget supporting the Grand Cherokee and $37.5 million behind the Cherokee. Ford's most popular SUV was the Explorer with sales in 1993 of 302,201 units, which comprised a 29.0 percent market share of the compact SUV category. With the addition of the Ford Bronco in the full-size category with sales of 29,729 units, Ford sales of all SUVs totaled 331,930 for a 23.7 percent market share of the SUV category. The Ford Explorer had the highest brand awareness at 92 percent, overall opinion tied with the Jeep Grand Cherokee at 80 percent, and the highest likelihood to purchase at 81 percent when compared to major SUV brands. The advertising budget for the Ford Explorer was $24 million in 1994 backed by a $1 billion corporate advertising campaign. Chevrolet SUV sales in 1993 totaled 295,740 for a 21.1 percent market share of the SUV category with the Chevrolet S-10 Blazer in the compact category and Chevrolet Suburban, Tahoe and Blazer in the full-size category. The advertising for Chevrolet's SUV brands totaled $71 million.

SUV Manufacturer 1993Compact SUV Unit Share 1993Total SUV Unit Share 1994Advertising...
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