situation - angelfire s40 sost… · web viewword count : 2196 contents ... planning process 3....

Marketing Communications Assignment 1

David Pollard

Word Count: 2196

The Mystery of Dalarö

The Volvo S40 Advertising Campaign

SOSTAC Analysis

Volvo S40 campaign SOSTAC Analysis

Contents

Introduction 3Methodology 3

Marketing Communications Planning Process 3Situation Analysis - Where are we? Why are we here? 4Objectives - Where do we want to be? 4Strategy - How could we get there? 5Tactics - How will we get there? 5Action 5Control - Did we get there? 5

Volvo New S40 Campaign – SOSTAC 6Situation Analysis 6

Product and Organisation 6Market and Competition 7Customers 8

Objectives 9Precise Objectives of campaign 9

Strategy 10Tactics 11Action 13Control 14

Conclusion 15References 16Bibliography 17Appendices 1 19

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Introduction

On the 26th January 2004 Volvo launched a marketing communications campaign to support the launch of the new Volvo S40. In this report I will apply the SOSTAC analysis to their campaign to establish what there aims and objectives were and how successful the campaign was in meeting them.

Methodology

Marketing Communications Planning Process

There are many different approaches to formulate a marketing communications plan. However most will include similar aspects when compared to others. This is probably best demonstrated by David Pickton and Amanda Broderick in Integrated Marketing Communications as shown below in Table 1. It is important to remember when using planning tools, such as those that appear below, that it is not always best practice to complete each section in the order that they appear and that nothing should be fixed, no marketing communications plan will work if it not able to adapt quickly.

Table 1 A summary of Typical Planning Formats

All plans Cooper Smith et al. SOSTAC

J. Walter Thompson Advertising agency

RABOSTIC Typical Response

Situation Familiarise Situation Analysis

Where are we?Why are we Here?

Research and Analysis

Develop a situational analysisUnderstand the market and its influencersUnderstand competitorsIdentify problemsIdentify opportunities

Targets Who are we talking to?

Audience(s) identification

Determine who should be targeted for marketing communications

Resources Budgets and allocations

Decide how much resource is needed

Objectives What are we trying to achieve?

Objectives Where could we be? Objectives Set what needs to be achieved

Strategy How do we expect to achieve it?

Strategy How could we get there?

Strategy Develop message, media and marketing communications tacticsSchedule activities including plans to evaluate progress

Tactics Tactics Tactics Put the plan(s) into action

Implementation

Action Implementation Measure and track the effectiveness of the marketing communications

Evaluation and

Control

Control Are we getting there? Control

(David Pickton Et al. 2005)

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For the purpose of this assignment I will be using the SOSTAC approach as developed by Paul Smith et al. I have decided to use this approach as it is concise, and covers the main points without expanding each point too much. I believe that for my purpose this is a useful approach however other approaches may prove more effective in other situations.

Situation Analysis - Where are we? Why are we here?

The Situation analysis looks at all the factors that will affect marketing communications. This enables a truly affective campaign to take shape, as a campaign is not going to work well if a company doesn’t look at its product and ask themselves what it is saying to consumers. Or look at a competitor and assess what they are doing. The following areas should be analysed in the situation analysis.

Organisation Competitors consumers Market Product

Objectives - Where do we want to be?

It is important that objectives meet the SMARTT criteria, this being: Specific Measurable Achievable Realistic Relevant Targeted Timed

By ensuring objectives meet this criteria then an organisation will have clearly defined objectives and will be more likely to conduct a successful marketing communications campaign. There can be many different objectives an organisation may be trying to achieve, some of the most common include

Awareness Understanding Preference Attitude Action

Strategy - How could we get there?

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In this section an organisation can develop possible methods of marketing communications in order to reach their objectives. There are many different types of strategy, in many cases an organisation will use more than one strategy, and it is also quite likely that these will overlap as an organisation may apply certain elements of a number of strategy types to their campaign. Some of the most common strategies can be seen below.1. Push/pull2. Generic3. Unique selling proposition4. Brand-led5. Positioning/repositioningWho the target audience is and what type of advertising message is to be used (e.g. rational, emotional or moral) is also an important factor.

Tactics - How will we get there?

This is where an organisation will decide on a strategy looked at previously and factor in the following variables: Media selection: Effectiveness, Efficiency, Economy Inter-media decisions Intra-media decisions Primary/secondary decisions Timing Budgeting

Action

This involves implementing the marketing communications plan, and making sure that all elements run smoothly and on time.

Control - Did we get there?

This section analyses the effectiveness of individual aspects of the campaign as well as the overall effectiveness. For example: How was the campaign measured? (Advertising & brand recall etc?) Did the communication meet its objectives? Did it follow the timing plan? Did it stay within budget?This is very important for future promotions and campaigns, as something valuable is likely to be learnt whether the marketing communications achieved its objectives or not.

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Volvo New S40 Campaign – SOSTAC

Situation Analysis

Product and Organisation

Volvo was previously thought of as a maker of safe and practical cars. This was due to a heavy focus on the safety of their vehicles in past promotional campaigns. This shows that they have a strong brand image and if asked many people would still say that Volvo cars main strength is safety, even though tests showed up that the old S40 was not the safest car in its class (large family cars). Even with the new S40 they are at the same level as other car models such as the Peugeot 407 and the Renault Laguna (See Appendices 1 for full details). This means that safety is no longer a unique selling point for Volvo and it is therefore important to redefine Volvo cars before they lose the competitive advantage. In short Volvo can no longer sustain a competitive position using safety as a key feature of Volvo as this has become an expected feature in premium cars and can no longer be used as an augmented element in a sales strategy. Volvos global advertising director, Tim Ellis, who spoke at the Cannes international Advertising Festival, has been quoted as saying:

“Volvo is about Safety. In all our markets Volvo is known for safety. And that’s a good thing and not such a good thing, because if you take a look at the set

of values that drive people to buy a premium car, safety is in there, but its way down the list. It’s great and people want safe cars, but it’s become a point of

entry for Premium Cars” (Veldre, Danielle. 2004)

Volvo sold 415,000 cars Worldwide in 120 countries in 2003; this is an increase of 2.2% from 2003. Below Table 2 shows the sales of Volvos top ten regional markets, these make up over a third of all Volvo sales. With 6 of the 10 top markets losing sales it is clear that Volvo needed a European campaign to boost sales.

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Table 2 Volvo Sales 2003

Volvo Sales In Ten Biggest MarketsCountry 2003 +/- 2002

USA 134,620 +22%Sweden 47,928 -1.5%

Great Britain 39,135 -3.7%Germany 30,285 -26.2%

Italy 18,416 +1.6%Netherlands 16,204 -6.2%

Japan 14,755 -3.2%Spain 14,034 +2.0%

Canada 10,750 +13.9%Belgium 9,426 -10.5%TOTAL 335,533

(Volvo Car Corp… 2004)

Market and Competition

The new Volvo S40 costs around £15,000 - £24,000 and is classified by European New Car Assessment Programme (ENCAP) as a Large Family car. Other cars included in this classification can be seen in Table 3 below. Although this is not a market based segmentation it does show a number of car models that the Volvo S40 are in competition with at a broad level when people are considering buying a large family car. However Volvo classes themselves as a premium car, with the market leaders in the premium car market being BMW and Mercedes. Out of this list in Table 3 the competition for a large premium family car is likely to be:

Audi A4 (£18-28k) BMW 3- (£Series 19-30k) Jaguar X-type (£19-31K) Mercedes C-class (£21-26k)

Saab 9-3 (£16-24k) Volvo S40 (£15-24k) Volvo S60 (£19-34k)

Table 3 - Large Family Car Market

Large Family CarsAudi A4 Peugeot 407

BMW 3-series Proton ImpianCitroën C5 Renault Laguna

Citröen Xantia Rover 600Ford Mondeo Rover 75Honda Accord Saab 9-3

Hyundai Elantra Skoda OctaviaJaguar X-Type Skoda Superb

Mazda 6 Subaru Legacy OutbackMercedes C-class Toyota AvensisMitsubishi Carisma Toyota Prius

Nissan Primera Volkswagen Passat

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http://www.euroncap.com/content/safety_ratings/details.php?id1=3&id2=92













Opel/Vauxhall Signum Volvo S40Opel/Vauxhall Vectra Volvo S60

Peugeot 406Source: ENCAP

Customers

In the article “Safe, Sure, but Sexy? Yes!” Danielle Veldre quotes Tim Ellis as saying that Volvo has “a loyal base of S40 owners, but there aged about 85” although this is probably a comment that was not backed up with any statistics, the point he is making is that the customer base is old, and they need to target a new market if they are to survive. Initial research to identify its consumers and weak brand attributes revealed that

“Volvo remained strong on safety but was weak in highly motivated areas, such as “proud to own”, a significant motivation for potential purchasers.

Volvo needed to evoke such pride in consumers, in order to compete with market leaders Mercedes and BMW.”

(Veldre, Danielle. 2004)

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Objectives

Volvo produces high quality cars and felt that they could compete with the luxury car manufacturers such as BMW and Mercedes on a quality aspect rather than safety, despite the Volvo S40 coming out as a safer car.Volvo’s main objective was to attempt to change people’s perception of Volvo cars, starting with the new S40. To Volvo it was vital that people viewed there car as a realistic alternative to premium brands such as BMW, Mercedes and Audi. Otherwise Volvo European sales would slowly decline which would put a pressure on other markets. Volvo had to push people’s attitude and perception of Volvo to that of a more desirable product. In short Tim Ellis descried the campaign as “a conquest Strategy”. Volvo decided that this campaign had to be different. Using as much media as they could afford would not help them gain sales, as there competitors had larger budgets and could match any TV and press coverage that Volvo could produce. It is not un-realistic to assume that Volvo can change consumer’s perceived image of their cars. It has been done before within the industry, the most recent of which is probably Skoda pushing their brand as one of an affordable quality car.

Precise Objectives of campaign Change peoples perception of Volvo, in order to compete with market

leaders Increase awareness in target group of 19-44 year olds Increase “Proud to Own” response in questionnaires, making Volvo a

desirable brand Increase Dealership visits Increase website activity

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Strategy

For Volvo the main purpose of the marketing communications is to reposition them selves as a premium brand that people are proud to own. To do this there are various strategies available to them, as listed in the Methodology section.Volvo needs to use a pull strategy to create demand and/or interest in the S40. In this case this would be more successful than a push strategy as the dealerships are mostly owned by Volvo anyway, so the distribution channels will not be much of a problem, and the main focus is to create a long term increase in sales. Looking at a wider picture push strategy of sorts may well be required to target internal audiences such as the sales force at dealerships, as they need to be informed as to what is happening so they are able to handle the demand if the marketing communications campaign is successful.

There are a number of options available to Volvo.

1. Use television advert as the main focus of the campaign in a novel way, hoping that people will take in the advert; this could then be backed up by print adverts and Press releases.

2. Use an advert to gain initial attention of the target audience, and then leave them with little information and the website address so that they become curious and will actively seek more information. Create a unique web site and press articles online as well as in newspapers and magazines. Creating a hyped up campaign will get everyone talking about the advert.

3. Use lots of banner advertising on car enthusiast and general interest web sites to promote the new S40, then rely heavily on Word of mouth to increase awareness

4. Use a viral marketing campaign e.g. making a funny or intriguing video advert and then distribute it via email to people. This type of campaign can be very effective as people will pass on the email to their peers, giving a very large audience. By doing this people will hopefully go to the website for more information.

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Tactics

By directing consumers to the website out of curiosity about the television advert, Volvo was able to implement a more interactive marketing communications plan. This would see very high results, compared to using television as the message delivery method.

Inter-media and Intra-media decisions

Volvo decided to use a wide range of Medias for the whole campaign. This included:

Television advertising Interactive Television PR releases Internet micro site Internet Pop ups Magazine adverts Online articles

The media types were all used in a very different style to other campaigns with the television advertising taking a back seat and the internet micro site actually being the primary media. However the Television advert still played a huge role in the campaign. It was aired on terrestrial channels and in prime time viewing and was used to create initial awareness and encourage consumers to log on to the web site to find answers, opening up the possibility of a more interactive communication. The advert also enabled viewers with digital television to view much of the content that would appear online, such as an extended documentary that supposedly uncovered ‘The Mystery of Dalarö’.

Budgeting

It is not known how much Volvo spent on this campaign; however it would be logical to assume that with the effective use of the internet, and using television as a secondary media that it would have cost them less than most car manufacturers marketing communications campaigns.

“Ellis says Volvo spent 18% less than on this campaign than for its previous sedan launch, and the performance of the S40 campaign “blew it away”.

(Veldre, Danielle. 2004)

For Volvo this was not so much a choice but a necessity, if they were to launch a huge campaign simply focused on getting more air time than their competitors then they would fail.

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"We compete with the other premium automotive brands and they have at least 6% more money than we do to spend on media so we have to find new

ways."(Volvocars.com)

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Action

On the 26th January Volvo launched ''The Mystery of Dalarö'' campaign with a TV advert stating that 32 people in the small town of Dalarö all bought a new Volvo S40 on the same day. If viewers wanted more information they had to go interactive (“press red”) or go online. This enabled consumers to view a documentary about the mystery. The TV advertising ended on the 14 th March, with the whole campaign ending on the 31st March. The campaign was launched in the UK, Ireland, Spain, Belgium, Netherlands, France, Luxembourg and Switzerland. However this is all just one part of the campaign. Volvo then made a spoof website claiming to be from the director of the advert, Carlos Soto, when in fact the documentary maker is academy award winning director Spike Jonze. The website claims that the documentary is a fake. This caused many articles to be written arguing the integrity of the documentary, which was of course the aim of this element of the campaign.

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Control

The whole campaign proved a huge success, as shown below by the quotes collected from different articles about the campaign. 64% of the 96,000 UK visitors have watched the full Dalarö documentary online (The Truth behind…, 2004) with a “75% click-through” on the pop up for Carlos Soto’s Website (Volvocars.com, 2004) and the European Volvo web site has one million visits during the campaign. Over 1,500 people in the UK have requested more details on the new S40 from the site with 6,200 people in the UK requesting a copy of the Dalarö DVD from the site.435,000 digital viewers of the ad opted to view the documentary via interactive TV. (Volvocars.com, 2004)

In regards to the “proud to own statement conducted at the beginning of the campaign this increased

“And according to a Millward Brown study in the UK, there was a 44% increase in the “proud to own” Volvo brand attribute and 166% in the

“attractive styling element” attribute”(Danielle Veldre, 2004)

This study also highlighted many other positive affects of the campaign:

“A tracking study by Millward Brown Precis shows a steep rise in recognition of Volvo advertising since the Mystery of Dalarö and Volvo's core age group (17-44 year-olds) reported a high level of positive engagement for both S40

and V50 ads. During the campaign Volvo had a higher recognition than competitors including BMW, Mercedes and Saab.”

(Volvocars.com, 2004)

In terms of dealership footfall traffic increased by “more than 700% in the first week” and “stabilised at more than 400% in the fifth week” (Danielle Veldre, 2004) this is a huge success, and is probably a better success than Volvo had estimated, exceeded its objectives.

As far as I know the budget was kept to and was smaller than the usual budget for a new car launch.

Ellis says Volvo spent 18% less than on this campaign than for its previous sedan launch, and the performance of the S40 campaign “blew it away”.

(Danielle Veldre, 2004)

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Conclusion

The success for Volvo is down to the strength of the campaign as a whole, however one key factor in what was ultimately an online campaign was the TV advert. Without this creating the initial mystery and intrigue, the campaign would not have been as successful, and it is an example of a truly integrated marketing campaign.Many companies now use the internet and digital Medias, but few truly embrace it as part of the integrated marketing communications plan in the way in which Volvo have with this campaign.

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References

Halliday, Jean, (2004) Volvo goes viral with Web 'mockumentary', Automotive News; 3/29/2004, Vol. 78 Issue 6086, p73, 1/6p, 1c

Pickton, David; Broderick, Amanda. (2005) Integrated Marketing Communications, Second Edition, Pearson Education Limited, England.

Smith, Paul; Berry, Chris; Pulford, Alan. (1997) Strategic Marketing Communications. London: Kogan Page

Unknown Author (2004) Volvocars.com, Brand strategy, November issue

Unknown Author, Volvo Car Corporation 2004 Pocket guide (2004) available at www.media.volvocars.com last visited 30th January 2005

Unknown author, ''The Mystery of Dalarö'' - Volvo Documentary - Fiction! (2004) Stephen Bells website http://www.stephenbell.net/archive/2004_03_01_archive.htm last visited 30th January 2005

Unknown Author, The Truth behind the Mystery of Dalarö (2004) Volvo Owners club, Press Release, March 25 2004, http://www.volvoclub.org.uk/press/releases/250304.htm last visited 30th January 2004

Veldre, Danielle (2004) Safe, Sure, but sexy? Yes!, B&T, 25 June 2004

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http://www.volvoclub.org.uk/press/releases/250304.htm

http://www.stephenbell.net/archive/2004_03_01_archive.htm

http://www.media.volvocars.com/


Bibliography

Adcock, Dennis; Halbourg, Al; Ross Caroline (2001) Marketing Principles &

Practice, Fourth Edition, Pearson Education Limited, England.

Brassington, Frances; and Pettitt, Stephen; (2003) Principles of Marketing,

Third Edition, Pearson Education Limited, England.

Kotler, P.; Armstrong, G.; Saunders, J. and Wong, V. (1999), Principles of

Marketing, Second Edition Edition, Prentice-Hall

Maddox, K. (2004) Online advertising will grow in 2005, Vol. 89, Issue 15

Varey, J. Richard. (2002) Marketing Communication: Principles and Practice,

Routledge, London.

Yeshin, T. (1998) Integrated Marketing Communications: The holistic

approach, pg171, Butterworth Heinemann, Oxford.

Halliday, Jean, (2004) Volvo goes viral with Web 'mockumentary', Automotive News; 3/29/2004, Vol. 78 Issue 6086, p73, 1/6p, 1c

Pickton, David; Broderick, Amanda. (2005) Integrated Marketing Communications, Second Edition, Pearson Education Limited, England.

Smith, Paul; Berry, Chris; Pulford, Alan. (1997) Strategic Marketing Communications. London: Kogan Page

Unknown Author (2004) Volvocars.com, Brand strategy, November issue

Unknown Author, Volvo Car Corporation 2004 Pocket guide (2004) available at www.media.volvocars.com last visited 30th January 2005

Unknown author, ''The Mystery of Dalarö'' - Volvo Documentary - Fiction! (2004) Stephen Bells website http://www.stephenbell.net/archive/2004_03_01_archive.htm last visited 30th January 2005

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http://www.stephenbell.net/archive/2004_03_01_archive.htm

http://www.media.volvocars.com/


Unknown Author, The Truth behind the Mystery of Dalarö (2004) Volvo Owners club, Press Release, March 25 2004, http://www.volvoclub.org.uk/press/releases/250304.htm last visited 30th January 2004

Veldre, Danielle (2004) Safe, Sure, but sexy? Yes!, B&T, 25 June 2004

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http://www.volvoclub.org.uk/press/releases/250304.htm


Appendices 1= Test and rating procedure applied up to 31 December 2001

= More stringent test and rating procedure adopted for cars tested from 1 January 2002.

NOTE: Because of the changes to the pedestrian testing and rating procedure, a blue star result cannot be compared with a green star result.

Large Family CarsModel Year Front and Side

Impact RatingPedestrian Test Rating

Child Protection Rating

Audi A4 2001

Audi A4 1997

BMW 3-series 2000/2001

BMW 3-series 1997

Citroën C5 2004

Citroën C5 2001

Citröen Xantia 1997

Ford Mondeo 2002

Ford Mondeo 2002

Ford Mondeo 1997

Honda Accord 2003

Honda Accord 1.8i LS 1999

Hyundai Elantra 2001

Jaguar X-Type 2002

Mazda 6 2003

Mercedes C-class 2001

Mercedes C-class 1997

Mercedes-Benz C-Class

2001/2002

Mitsubishi Carisma 2001

Nissan Primera 2003

Nissan Primera 1997

Opel/Vauxhall Signum 2003

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Opel/Vauxhall Vectra 2002



Peugeot 406 2001

Peugeot 406 1997

Peugeot 407 2004

Proton Impian 2002

Renault Laguna 2003

Renault Laguna 2001

Renault Laguna 1997

Rover 600 1997

Rover 75 2000, 2001

Saab 9-3 2003

Saab 9-3 1999

Saab 9-3 Convertible 2004

Saab 900 1997

Skoda Octavia 2004

Skoda Octavia 2001

Skoda Superb 2003

Subaru Legacy Outback

2003

Toyota Avensis 2003

Toyota Avensis 1998

Toyota Prius 2004

Volkswagen Passat 2001

Volkswagen Passat 1997

Volvo S40 2004

Volvo S40 1997

Volvo S60 2001

Source: http://www.euroncap.com/content/safety_ratings/ratings.php?id1=3

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