Individual Case Study Analysis

Introduction: Individual Case Study Analysis

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The STP approach refers to a structural framework which helps the company in implementing marketing strategies. It is process through which a company distributes its consumers according to their profile in a range of variables. The report shed light on Volvo's mission with sustainability, brand positioning, targeting, competition and safety. In order to protect the environment and nowadays the changes in consumer behavior towards electric cars are increasing. So for that reason, the company is shifting its production method and bringing new innovations and technologies to produce according to the market trend. The report also reflects the market size in different countries and the feasibility of the company.

Questions

Q1. Presenting the main target segment of Volvo

According to the case study, the main segmentation criteria for Volvo cars are related to all four segmentation strategies. In accordance with geographic segmentation, Volvo Cars have set up their business on the basis of their customer's residence. The company has grouped its customers according to country, city, state, and town. Volvo mostly operates more in Europe as compared to America because it is a European company. Volvo's consumers reside in a wealthy community in a wealthy country and are young in age.

Volvo's demographic segmentation is distributed in relation to the education, income, age, and gender of its consumers. The demographic segmentation helped Volvo to create its consumer base. Volvo has different consumers at varied places according to age group, earnings and characteristics which define the people's preferences. Age is the most important factor in Volvo's business. Volvo's customers are from 25 to 50 years of age group. Talking about safety, reliability and comfort both females and males will prefer Volvo cars for their family.

Depending on the behaviour of the consumer is psychographic segmentation. It totally depends on the clients on how they spend their money and time on cars. Volvo has different car models based on the psychological condition of every customer (Stylidis, et al., 2020). Consumers are not only worried about them only but they are also worried about the environment also. Now consumers want those cars with zero carbon emissions so that less pollution into the atmosphere. Volvo cars are comfortable, produce less pollution, are affordable, modern, easy to drive, and relaxing.

Volvo's main target market is people who prefer safety and quality over price. For consumers who prefer performance vehicles, Volvo cars are best for them. Parents who give priority to their children's safety use to buy Volvo cars these days. Company's consumers are knowledgeable, well-educated, upper-class, middle-class and liberal. Drivers observe Volvo cars as the safest passenger vehicle which protects all of them from any disaster and hazard taking place during a journey (Svantesson and Broström, 2021). These cars are sometimes high-maintenance and are a bit pricey but drivers consider Volvo cars as works of art and their design as a well-made mechanism. Volvo's business is mostly in Europe and Europeans want Volvo to make car designs according to the European engineered feel rather than a design made according to Asia.

Q2. Assessing the extent to which segmentation and targeting strategies of Volvo are aligned with the feasibility criteria

The targeting and segmentation strategies of Volvo are aligned with its segmentation feasibility. In accordance with the case study, the market segments include measurable, actionable, safe, sustainable, and differentiable. In terms of safety, talking about today's era from my perspective Volvo's XC90 addresses road departures whenever turn accidental with the help of protection technology. XC90 is being recognized as the world's first run-off road protection technology car (Karab?y?k, 2022). The car also has energy-absorbing technology which enables a balance between the seat cushion and the seat while driving in the terrain area. According to the income group targeted who prefer cars that reflect their social status, lifestyle and those who prefer comfort ability and safety Volvo has defined meaning for both. In this way, the models of Volvo align with the demographic segmentation of its clients.

In terms of sustainability and innovation, the case study clearly reflects the measures taken by Volvo to produce green and electric-driven cars to protect the environment. With this innovation, the company is heading towards a differentiation strategy from its existing competition. Production of green vehicles will give Volvo a chance to stand apart from the competition and increase its market size. More and more number of consumers are shifting toward riding electric vehicles so Volvo's revenue will increase. In this way, Volvo is align with the psychographic segmentation in terms of the opinions, values and beliefs of its consumers.

In my opinion, Volvo Cars are quite accessible. Because it not only produces luxurious cars for upper-class people but also for middle-class people who can afford them easily is the pricing strategy. Parents feel safe and they can give these cars to their youngsters as the cars are safe and accessible to them and their kids. Volvo adopted some potential and identified targeting methods to attract its consumers in the distribution strategy. Also, the company used growth and capabilities objectives to increase its consumer base through its promotion strategies. In this way, the company segmentation to its feasibility criteria discussed in the case study reflects Volvo's methods and strategies it applied and obtained by trial and error.

Q3. How do you evaluate Volvo's positioning strategy in terms of its focus on safety?

According to the research done by me, I noticed that Volvo is obsessed with the safety it provides to its consumers. Volvo's positioning and brand strategy are comprised of many things like car design, models, affordability etc. and safety is one of them. In the 1960s Volvo's major focus was too aware its consumers wear seat belts while driving the car. Volvo was ahead of any other car brand in terms of safety. The company already knew that at some point in time, the people would take safety as a serious issue while driving onto the road.

The company has taken safety as its priority in brand positioning in my view. An innovation done by the company that got a patent was the introduction of three-point seat belts in cars in the year 1958 (Jonsson and Vahlne, 2021). Volvo also shared this technology with other companies so that they could also produce such safe cars for their consumers. This action shows Volvo's conviction and authenticity in my opinion. In the year 1990, Volvo introduced side airbags and airbags in the cars. In 2012, the Volvo model V40 got a Euro NCAP collision test and was recognized as the safest car in 2012.

According to a Car Safety Research Report by Thatcham Laboratory, 2023, studied by me since 2002 the XC90 car model has been considered to be the safest car in the UK and not a single person has faced any disaster or accident with this car model. The model has features like enabling parents to lock their children's gates through child lock so that their children are safe. In 2017, with the introduction of the XC40 model, Volvo proved again that the safety of its consumers is its first priority. Volvo worked hard to prove themselves for safety against its competition. With this Volvo received five-star ratings among its consumers which helped the company win the Car of the Year prize from Europe car of the year award and also the Euro NCAP tests. In this way, Volvo maintained its positioning in the market with safety.

Q4. Defining STP strategies could Volvo implement, particularly in terms of ensuring future growth and competitiveness?

Volvo has always tried to make its customers happy. According to the demographic and psychographic segmentation, in the upcoming period, the company should segment its customers on the basis of social status, age, income, lifestyle and values. Moreover, in the near future, Volvo will bring new models for both these categories of people. Those models will give comfort, and luxury, and will increase the social status with its innovative design. In this way, Volvo will increase its sales in the future and will remain ahead of the competition. These aspects clearly exhibits that by offering innovative models to the upper-income class people Volvo can gain competitive edge and increases profitability as well.

By the year 2020, not even a single person will be killed or face an accident if he/she driving a Volvo car in terms of safety and security. By 2025, the company is aiming to spend at least one week of quality check time for its cars in terms of connectivity and technology. As per the need of the environment, the company is aiming to produce 50 per cent of its vehicles electric by the year 2025 which will impact the environment in a positive manner. Also, Volvo Cars' vision is to lower carbon emissions by 40 per cent in future according to a report published by Volvo Group Statistics & Facts, 2023. With an aim to create a distinct image in the minds of customers, Volvo will position itself on the basis of sustainability and quality. By highlighting these aspects in advertisements firm would become able to attract a large number of customers.

The targeting strategy involves the upper class and middle class and youngsters who like innovation and technology for them the company is designing their upcoming models in a fully autonomous way that will be fully electric by the next decade (Bergquist and Näsman, 2023). Implementing these strategies will help the company to increase its consumer base and consumer relationships. Volvo is offering a safe, sustainable and easy way to its customers.

Conclusion

In conclusion, Volvo Cars have emerged as a great leader in the market of car production. With the best innovation, technology, accessibility, and actions the company has been significantly growing. The biggest measure of Volvo cars to produce electric vehicles will give immense growth to the company in future.

References

Books and Journals

• Bergquist, A.K. and Näsman, M., 2023. Safe before green! The greening of Volvo Cars in the 1970s–1990s. Enterprise & Society. 24(1). pp.59-89.
• Jonsson, A. and Vahlne, J.E., 2021. Complexity offering opportunity: Mutual learning between Zhejiang Geely Holding Group and Volvo Cars in the post?acquisition process. Global Strategy Journal.
• Karab?y?k, H.Ç., 2022. Communicating Images: A Discussion on the Positioning Strategy of Volvo Cars and the Model SS (Super Safe) Recommendation. In Sales Management for Improved Organizational Competitiveness and Performance (pp. 303-319). IGI Global.
• Stylidis, K., Al-Saidi, E., Erinjery, A.T., Lindkvist, L., Wickman, C. and Söderberg, R., 2020. Design of the top tether component for the premium car market segment: Case study of Volvo Cars. Procedia CIRP. 91. pp.146-151.
• Svantesson, R. and Broström, M., 2021. Distribution strategy of Volvo Cars last-mile logistics with direct to end-consumer sales.

Online

• Car safety research report by Thatcham Laboratory. 2023 online available through <https://www.thatcham.org/>
• Volvo Group Statistics & Facts. 2023 online available through <https://www.volvogroup.com/en/about-us.html>