SMART CAR CASE
What is Smart’s competitive advantage? Its brand image?
The Smart Car, made by DaimlerChrysler, offers a cost focus and focused differentiation. It brand image is very narrowly focused. Smart appeals to single people (or families with no children), who primarily do city driving and want a no frills automobile that is economical and eco-friendly. Some advantages that Smart brings to the table are as follows. First, the vehicle has an exceptional look that appeal to those who want to be unique. Next, this very small, but roomy vehicle makes city driving and tight parking easier. Subsequently, crash testing and safety experts consider Smart as an extremely safe vehicle. Moreover, its models are very fuel efficient at 35 mpg on average. In addition, this automobile’s low exhaust emissions earned an Ultra Low Emission Vehicle (ULEV) classification. Finally, the vehicle is very economical and cost friendly.
Assess the U.S. market potential for the Smart. Do you think the car will be a success? Why or why not?
Smart Car is economical, unique, and eco-friendly. Generation Y (Gen Y) is a target market, which should be pursued because Gen Y’s, those born from 1977 to 1994 (1980-1995, depending on who you ask), is demographically too large to ignore. In 2009, the US Millennials made up 25% of the population, which already exceeds the size of the Baby Boomers’ buying power, spending over $200 billion, annually. In addition, from a behavioral sense, the Gen Ys are seen as more frequent purchasers, even for vehicles. This is due to their technical shrewdness and their brand conscious ways. If Smart continues with their current strategy, they will not be a success in the U.S. market. First, one of the major reasons that DaimlerChrysler moved into the U.S. market was out of desperation, since they were not as successful in the European market as they wanted, being rated in the bottom five in 2006. With all of the bad publicity, Gen Ys were...
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