GROUP 8B

Porsche Marketing

Report

Segments and 4Ps

Shubnit Aurora, Kudzanayi Goromonzi, Kristie Nicol, Heather Streeton,Shubnit Aurora, Kudzanayi Goromonzi, Kristie Nicol, Heather Streeton,

Mehdi MehrabaniMehdi Mehrabani

November 23, 2009

MKTG 317 L08

Janus Barzilay

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Table of Contents

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Part A - Product Strategy

Through a diverse set of products, Porsche has successfully built a strong brand

in the global automotive industry (Brandz 2009). While originally opening as an

engineering and consulting firm in 1931, Ferdinand Porsche has since built an

automotive empire with just twenty four models as of 2009 (Porsche 2009e).

The table provided in the Appendix C illustrates Porsche’s product mix,

focusing specifically on the three product lines that we feel best represent the

Porsche brand. These three product lines are sport utility vehicles (SUV’s), sports

cars, and sedans. This product mix represents how Porsche is following a limited

line strategy whereby they are targeting a market niche interested in sporty

luxurious high-class vehicles (See Appendix D for Porsche Perceptual Map). This

has allowed Porsche to focus on small segments, directing their efforts towards

specific consumers that are interested in the features that Porsche vehicles offer

(Charlebois et al. 2009a; Dietz 2007).

However, in 2002 Porsche used a diversification strategy to enter a new sector

in the automotive industry by coming out with their SUV line: the Porsche

Cayenne (Barzilay 2009a; Scott 2002). This line currently offers six different

models that differ mainly in engine capabilities and a few interior design changes:

engine size, speed, leather, and colour (See Appendix C for Porsche Product Mix)

(Porsche 2009b).

The Porsche Panamera is the newest addition to the product mix. With a front

engine and a rear wheel drive, the “four-door four-seat luxury Panamera sedan”

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was introduced to the North American market on October 17th, 2009 (Kurylko

2007; Porsche 2009k). The Panamera line combines the speed and capabilities

shared amongst Porsche’s sports car line with the size and space of a traditional

sedan (Elliott 2009). With introduction of the Panamera, Porsche has diversified

their product mix to hedge risk in the current economic environment and to keep

up with the changing trends that the Porsche culture demands (Barzilay 2009a;

Kiley 2009).

The sports car line has and always will be the hallmark product for Porsche.

This line can be further broken down into three unique vehicles types: Porsche

911, Porsche Boxster, and the Porsche Cayman. The Porsche 911 line has been

one of the most influential and profitable vehicles in the product mix since its

introduction in 1964 (Frere 1992; Porsche 2009e). These models are offered with

“two types of carriages (Coupé, Cabrio), two types of engines (rear end/4-wheel

drive) and four performance variation (Carrera, Carrera S, Turbo, Turbo S)”

(Dietz 2007). Furthermore, in 1996 Porsche extended their sports car line with

the introduction of the Boxster in order to reach a wider segment in the

automobile industry (Porsche 2009e). With a lower price tag, the Boxster became

a more affordable Porsche vehicle in the Porsche automobile market without

sacrificing the features and the performance associated with the other models.

Interestingly, the 911 model has 36% of parts in common with the Boxster

allowing Porsche to benefit from economies of scale (Choi 1994). In 2006, Porsche

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introduced the “derivative model” of the Boxster in the form of a coupe: the

Porsche Cayman (Dietz 2007).

The remainder of this report will focus on the Porsche 911 Turbo. We have

chosen this model due to the importance it has had to the Porsche brand since its

introduction in 1974 (Porsche 2009e). It is said that the Porsche 911 Turbo is part

of the “core business” and an important representation of the Porsche soul (Choi

1994). This model can be purchased in both coupe and convertible versions

(James 2009). For comparison reasons, we have decided to use the coupe version

of the 911 Turbo. Consumers deciding to purchase a 911 Turbo understand that

the high price is justified by the quality and technical features of the vehicle.

More importantly, the large price tag is said to be offset by the feeling one gets

each time they step on the throttle (Callaway 2008). In addition, the 911 Turbo

has proven to be stable even during an economic crisis. After the stock price was

cut almost in half after the 9-11 attacks, Porsche 911 sales grew by 23% from the

year earlier, followed by a corresponding increase in stock price (Meredith 2002).

The Porsche 911 Turbo’s high price tag and limited production has established

it as a specialty product. Since its introduction thirty-five years ago, there has

been only seven generations of this model (Youtube 2009). With only twelve

Porsche dealerships within the Canadian borders, customers have to search

extensively to find a potential dealership that will carry the new 2010 Porsche

Turbo (See Appendix E for Porsche Dealerships in Canada). The limited quantity

of the 911 Turbo in Canada adds to the status of the model perceived by

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consumers (Okonkwo 2009). Even though there is low supply of the 911 Turbo in

Canada, consumers of this model are reluctant to accept any substitutes. This is a

common characteristic of a specialty product (Lamb et al. 2009b).

The 911 Turbo has undergone some modifications over the past years that have

affected its quality, functionality and style. In regards to its quality, the latest 911

Turbo model’s durability have improved, as seen by its longer-lasting oil-change

intervals, self-adjusting valves and belts, and longer periods between required

vehicle servicing (Porsche 2009g). Furthermore, the added aluminium doors on

the model has lightened its overall weight; enhancing its quality (Porsche 2009h).

Along with the above modifications, there has been an increase in horsepower

than the earlier model as well as improvements in functionality through

convenient gearshift paddles in the steering wheel (James 2009; PR Newswire

2009). Environmentally, the new model is considered one of the cleanest types in

its class. This has been achieved through lower fuel consumption and lower CO2

emissions of 18% compared to its predecessors (PR Newswire 2009).

The physical attributes of the 911 Turbo have not changed significantly in its

thirty-five year history. However, some features have been improved to keep in

tune with changing times and consumer preferences. For instance, the titanium

painted slats for the air intake has added to the sophisticated look of the vehicle

(Porsche 2009j). The “LED daytime running lights as part of a lightly revised

front bumper and new LED tail-lights” have added to the exotic look of the

911 Turbo (James 2009).

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Part B – Pricing

Traditionally Porsche has used the prestige pricing approach to the general

automotive industry. This has been done in order to convey an impression of high

quality and prestige with the associated vehicle (Pass et al. 2005). The underlying

assumption is that products with low prices are inferior to competitive products

that are sold at higher prices (Encyclopedia 2006). Alternatively, higher priced

products are perceived to have superior brand quality, which is reflected in the

upscale Porsche performance vehicle (Charlebois et al. 2009b)

However, Porsche used a different approach for the 2010 911 Turbo. They have

followed a penetration pricing strategy by setting the 2010 911 Turbo price lower

than comparable sports vehicles (see Appendix F for 2010 Porsche 911 Turbo

Specific’s vs. Competitors). Given the maturity of the 911 Turbo, Porsche is not

using penetration pricing as a means of launching a new product against an

established rival as is sometimes considered traditional (Wilson 2005). Instead,

this pricing strategy is likely being used to gain a larger market share, boost

sales, and increase brand recognition in the automotive industry. Consumers are

able to acquire the 911 Turbo, which is similar in functionality and brand equity

to competitors while spending considerably less. In addition, “penetration pricing

does not mean lower profit per unit,” however “to reach the break-even point, it

requires a high volume of sales” (Lamb et al. 2009i). This strategy is a great way

for Porsche to attract additional buyers to the market and tends to discourage

competition (Lamb et al. 2009i).

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The penetration pricing strategy is risky to implement and could prove

disastrous for a prestige brand like Porsche. With the adoption of a penetration

pricing strategy, Porsche can involuntarily destroy the 911 Turbo’s image by

making it seem inferior relative to its higher-priced competitors. This may offset

the relationships with their current upscale buyers (Lamb et al. 2009i).

The choice of competitors of the Porsche 911 Turbo is based on functionality,

brand recognition, and price range. Characteristics of vehicle functionality were

selected based on engine size, horsepower, and 0-100km/h times. Engine size of

the comparable vehicles needed to be in the range of 3.8 to 5.5 liters and with

more than 450 horsepower.

Porsche AG has been chosen as the third “most valuable automotive brand” of

2009 (Brandz 2009). This title has allowed Porsche AG to compete in the luxury

automotive sector, and still be recognized as valuable brand in the broad

automotive industry. Therefore, comparable vehicles need to closely parallel the

sporty, luxurious perception that is associated with the Porsche brand. Lastly,

competing vehicles need to be within the range of $150,000 to $210,000.

Based on the above criterion, there are three main competitors to the 911

Turbo. This includes the 2010 Lamborghini Gallardo LP560, 2010 Aston Martin

DB9 Coupe, and Audi R8 (Csere 2009). By referring to Appendix F, the

functionality criteria needed for comparison were met by all selected competitors.

Furthermore, all three competitors are well established and are well known

brands (MSN Autos 2009).

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After analyzing the price of the selected vehicle, it appears as though Porsche

has responded to their main competitors with lower pricing. The Porsche 911

Turbo has an MSRP of $165,300 CAD, which is $30,000 cheaper than the average

price of our selected competitors, $195,331 (see Appendix F for Porsche 911

Turbo Specific’s vs. Competitors). In fact, the Porsche 911 Turbo is the least

expensive in relation to the selected competitors. The lower pricing might be

because Porsche Cars Canada Ltd. decided to reduce their vehicle pricing by

almost 12% (Swanson 2007). Porsche expresses in its 911 Turbo promotional

video how this model provides more for less, and therefore optimizes the

relationship between cost and benefit (Porsche 2009j).

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Part C – Place (make references to figure 1.1 for distribution channels)

Canadian Automotive Distribution Channels

The three main distribution channels that occur within the Canadian

automotive industry: (1) Business-to-Consumers (2) Business-to-Business (3) and

Business-to-Government. However, the retailer distribution channel is the most

commonly used method within the Canadian automotive industry (Lamb et al.

2009c). All the distribution channels start with car part manufacturers, who are

normally located near automakers’ assembly plants to ensure that the process of

producing vehicle is as efficient and productive as possible (Autos & Auto Parts

2009). Since automakers do not carry all the parts required for their motor

vehicle, they require reliable suppliers and transporters to guarantee that

deliveries will arrive on schedule. Transportation methods such as rail carriers

play a major role in these supply chains. This is because they facilitate the just-in-

time deliveries and additional services such as “quality inspection and installation

of optional equipment” that car manufacturers favour due to the associated

reduced costs (Service Industries and Capital Projects Branch 2000).

When the vehicles are completely assembled, they are sold and shipped to

franchised dealerships, government bodies or private customers within Canada.

The dealerships are independent businesses that are free to set their own vehicle

prices. However, they must assume all the risks of reselling the vehicles they buy

(Autos & Auto Parts 2009). These dealerships act as retailers, primarily

responsible for the sales and distribution channel for automobiles in Canada (First

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Research 2009). Once the car is assembled, they can be distributed through

various channels. Most vehicles are manufactured, sold to dealerships, who then

sell them to final customers. The Internet has become a popular shopping venue

used by many automotive dealers. Search engines such as Autotrader.com,

personal selling, and used car dealerships allow consumers to simplify their

purchases by allowing them to pick up their pre-determined vehicles from the

dealerships (First Research 2009). In other instances, vehicles are sold as

businesses products to firms that use them in their business process. For

example, when company cars are bought to be used as rentals. The distribution

models illustrated on page 8 shows numerous outlets consumers have for

purchasing automobiles.

The Porsche Dealership

All the Porsches sold in Canada are produced in Stuttgart, Germany, with the

exception of the Porsche Cayenne and Panamera, which are produced in Leipzig,

Germany. Therefore, dealerships have to import vehicles from Germany when

they restock their inventory. The Porsche Cars Canada Ltd. has 12 dealerships

across Canada that have been placed in well-populated cities such as Calgary,

Toronto, and Vancouver (Porsche 2009l). The locations of the dealerships are

beneficial due to their host cities’ continual economic growth, and larger

percentages of individuals with high socioeconomic status (Statistics Canada

2009a). They are often located in busy commercialized areas because of the high

traffic flow and the tendency to draw in customers with a higher socioeconomic

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status (Muller 2006). Moreover, these dealerships are destination stores since

potential consumers purposely seek out their products. However, because

Porsche dealerships are located in densely populated areas, it is typical for them

to be surrounded by a large amount of automobile competition (Muller 2006). The

dealerships have addressed this drawback by using freestanding locations, which

imply that they are located in separate detached buildings (Lamb et al. 2009e).

Calgary’s Porsche dealership is located on MacLeod Trail as a freestanding

structure; this gives the dealership the advantage of having superior visibility and

accessibility in comparison to a strip mall surrounding. Each Porsche dealership

is a franchise, which means that the individual dealerships have been granted the

right to sell Porsche products (Autos & Auto Parts 2009).

All of the Porsche dealerships across Canada are trying to differentiate

themselves from their competitors by offering a larger product line. Porsche

offers a selection of 30 different kinds of automobiles within their product line,

giving customers the range from two-seater sports cars to five-seat passenger

SUVs.

Calgary Porsche Dealership Assessment

A stores image is key to any retailer’s success (Steenkamp 1991). The main

element of a store’s image is based on the atmosphere and the overall impression

conveyed by the store (Lamb et al. 2009e). When visiting the Calgary Porsche

dealership, we found its size to be unexpectedly small in comparison to other car

dealerships; however, the store’s visual factors quickly caught our interest.

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Despite its size, they managed to have five automobiles on display. The

dealership itself created a mood of warmth with the abundance of daylight from

their floor to ceiling windows. Their white and silver interior created a sense of

cleanliness, and the smell of new leather gave an overwhelming feeling of luxury.

The luxurious surrounding helped maintain the prestigious brand name and image

Porsche is trying to achieve. The fixtures had a consistent modern theme with

chrome lighting and a matching mantelpiece with desks made of light coloured

wood. Model characteristics can help target a market according to their income,

age, and sex (First Research 2009). Porsche uses their modern characteristics to

their advantage by using them to attract their target market of male baby

boomers. Our interaction with a Porsche employee was brief, however, during

our encounter we noticed he was a generation X male, had a professional

appearance, and was very knowledgeable about the Porsche market and products.

The sales personnel allow their customers to sit in and test any of the models they

want, in order to fulfill a fantasy. The salespeople are playing on the customers’

“fantasy adventure” by allowing them to get a small piece of what they desire,

homing in on the current trend stating that “with age the roads untaken become

more desirable” (Popcorn 2009b). All of these elements contributed to the overall

impression of the Porsche dealership, which we believe conveyed an overall

luxuriant yet, welcoming atmosphere.

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Part D – Promotion – Integrated Communications Plan

Target Audience

The Deep Pocket Boomers are white collared male adults aged 45 to 60. Over

the years, they have attained a high status within their working environment and

have become “workaholics”. Specific to Calgary, their work locations are

therefore, within the core downtown area. With the core downtown as the main

area of work, position titles held by the DPB’s would be executive positions in

firms such as EnCana Corporation and Deloitte & Touché LLP. In view of their

professional nature of their jobs, they have located themselves in the wealthy

neighborhoods such as Upper Mount Royal (Prizm 2009c).

With over 25 years of working hard and long hours in the labour force, the

DPB have obtained annual family income of greater than $242,000 (Prizm 2009c).

The many years spent saving and working hard have lead to substantial savings

for the DPB. In addition, they have recently entered the empty nest stage allowing

for more quality time spent for themselves and with their significant other

(Euromonitor International 2009a). With age and physical features becoming a

concern, healthy living and taking part in outdoor physical activities have become

priority in staving off age for this target audience (Euromonitor International

2009a).

As mentioned earlier, the DPB have had to work hard which had resulted in

giving up majority of their youth to obtain their current status. Therefore, the

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DPB value a sports car that will provide convenience, quality and greater service.

Thus, the DPB can regain some of the lost youth years by benefiting from the

thrill, luxury and status of a high-end sports car. In context to the current

economic condition, the buying rate for the DPB has been prolonged, however the

usage rate 23,000 km per year for vehicle weighing less than 4.5 tonnes

(Statistics Canada 2009b).

Communication Objectives

Since its origins in 1931, Porsche has developed a reputation for producing

high-quality vehicles and providing exceptional customer service, while

maintaining a luxurious image. Our integrated marketing communications (IMC)

plan is designed to draw attention to these aspects of Porsche, in relation to our

targeted audience-- the DPBs. In order to reach the DPB, it is imperative that we

recognize that most of the Porsche models have reached their maturity stage

within their product life cycles. Therefore, the appropriate objective of this IMC

plan is to ‘remind’ our target audience of the benefits of driving a Porsche vehicle.

A reminding approach assumes that the target market has already been

persuaded of the advantages of driving Porsche vehicles. Therefore, it places

emphasis on the need to keep the Porsche brand in the minds of the DPB

(Charlebois et al. 200c) and helps to encourage those who have already formed a

preference for their cars to buy one. This objective will facilitate Porsche’s focus

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on increasing their market share within the competitive Canadian automotive

industry. In addition, by reminding the target segment of Porsche’s attributes,

potential buyers will be motivated to switch from a competing brand (Charlebois

et al. 2009c). We hope that our IMC plan will encourage test drives, which will in

turn remind the DPB of the excitement that is associated with driving a luxury

sports car. Lastly, this approach will aim to build customer loyalty among

existing owners of Porsche vehicles, convincing them to remain with the brand

when replacing their current Porsche. Communication with existing Porsche

drivers would have to be maintained on an ongoing basis to reinforce the

attachment they have to their cars (Charlebois et al. 2009c). By reminding the

DPB of the quality, customer service, and luxury provided by Porsche, we hope to

increase market share, while maintaining the loyalty of their existing customers.

Communication Strategy

Our group has opted for the asymmetric strategy approach, which entails only

promoting the positive characteristics of the 911 Turbo model. The highly

competitive nature of the automotive industry allows little room for negative

publicity to be associated with a car brand. Any indication of the shortcomings to

buying a luxury vehicle could significantly harm brand equity, which is what

luxury car manufacturers such as Porsche rely heavily on to promote their

vehicles. Therefore, we cannot take the risk of using the symmetric strategy

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whereby we would highlight both the positive and negative aspects of the Porsche

911 Turbo model.

Furthermore, in an effort to create demand for Porsche vehicles, we have also

decided that a “pull strategy” should be utilized to communicate effectively with

the DPB. Porsche Cars Canada Ltd. (PCL) who would use various promotional

techniques to attract customers to their local dealerships will instigate our

communication strategy. In relation to Porsche, the demand would move up the

distribution channel and result in the following process: (1) Consumers would

demand vehicles from their local Porsche dealerships (2) The dealerships would

then demand vehicles from Porsche Cars Canada Ltd. (3) Lastly, PCL would order

the vehicles on behalf of the dealerships from the headquarters in Germany

We have chosen a pull marketing strategy because it would allow PCL to

ensure that the message promoted to the DPB is consistent. The promotional

methods used for this purpose will be outlined in the following sections of this

report.

In order to create the means for receiving feedback about the Porsche 911

Turbo, we also recommend utilizing a two-way strategy. Since the target market

is relatively small, it would be easier for Porsche to keep track of their potential

customers. Porsche can make use of an online website specifically tailored to the

marketing campaign. We recommend a website with the name

www.drivefastfeelyoung.com that will allow Porsche to keep track of visitors and

monitor the interest visitors (see Appendix I for Creative Execution).

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Communication Tactics

One of the goals of our IMC is to promote the “fun and pleasure” of driving a

Porsche 911 Turbo (Lamb et al 2009g). We want to give them a sense of

reclaiming their youth by driving a 911 Turbo. The most appropriate way of doing

so would be to appeal to the DPB’s sense of adventure; playing on their drive for

excitement and satisfaction. We also want to appeal to their “vanity and egotism”

by encouraging a sense of pride and ownership in owning a car of quality, style

and prestige (Lamb et al 2009g). The Porsche 911 Turbo is a car of pure luxury,

which is something we don’t want our target segment to forget. By playing to the

DPB’s ego and highlighting the prestige of the car, we hope to encourage those

driven by self-image to purchase the 911 Turbo. We want the DPBs to start

believing that if they want to buy luxury, they should buy a Porsche 911 Turbo. By

doing so, we will also be able to enhance and maintain the prestige of the Porsche

brand.

We would like to fuse two execution styles to promote the Porsche 911 Turbo.

The first style would focus on how well the 911 Turbo fits the lifestyle of the DPB

(Lamb et al 2009 h). The 911 Turbo would be shown as a car meant for a man no

longer constrained by the demands of his family, and as a car that could cater to

DPB’s freedom to go wherever he would like and do whatever he would want. The

second execution style would focus on creating a fantasy for the DPB’s that would

be built around the use of the 911 Turbo (Lamb et al 2009h). The style would let

the DPBs fantasize about the thrill and freedom the 911 Turbo, allowing them feel

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as if they could travel anywhere, from inner city streets to long country roads

with unadulterated speeds. The emphasis would be placed on the speed, luxury,

excitement and quality of the Porsche 911 Turbo.

Communication Mix

Our proposed IMC will combine various aspects of the promotional mix in

order to best market the 911 Turbo to the DPB market. This promotional mix will

emphasize the importance of personal selling, and will include advertising and

sales promotion. While various mediums are utilized in the IMC, all will

consistently reflect the superior quality, reliability, and luxury that the Porsche

911 Turbo offers to its customers.

Due to the expensive nature of the 911 Turbo, the decision-making process

entails a higher involvement from Porsche’s potential clients. These clients will

need to be assured that the high price paid for the 911 Turbo is a true reflection

of the quality, reliability and luxury of the model. Therefore, personal selling will

become a key factor, as it would allow Porsche to provide its potential clients with

extensive information through the interaction with Porsche’s knowledgeable sales

personnel. Moreover, clients associate social risks when buying a luxury vehicle.

This adds to the importance of personal selling in the purchasing process as it

guides client in making the right decisions.

The stage in the product life cycle (PLC) is another factor considered in the

commercial mix. As this is Porsche’s seventh generation of the 911 Turbo, we can

assume that this model is in the maturity stage of its PLC. At this stage, it is best

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to develop an advertising campaign that will focus on reminding consumers of the

key aspects of the 911 Turbo: quality, reliability, and luxury. We intend to

integrate these highlighted aspects into a new marketing campaign designed to

reach the DPBs using a new slogan: Drive Fast. Feel Young. In addition, Porsche

should focus on using sales promotions to increase their market share in the

luxury automotive industry. We propose a sales promotion that would entail a

roundtrip flight to Stuttgart, Germany. Details of this promotion will be provided

in the creative execution.

The final factor affecting the Porsche’s commercial mix is the funds available

for promotional efforts. Through the recent acquisition by Volkswagen, Porsche

has gained access to a larger pool of funds that in turn will allow Porsche to

optimize various promotional elements outlined in this report (Associated Press

2009). Although this is the case, it is recommended that Porsche should initially

use less expensive promotional elements such as advertising to draw in

customers. The promotional elements with higher “cost per contact” will then be

used at a later stage to produce sales. These expensive elements include personal

selling and sales promotion.

Creative Execution

We have used the AIDA model as a basis to accomplish four communication

objectives; attention, interest, desires and action. As mentioned in the

communications mix, we recommend that Porsche uses three elements to

promote the 2010 911 Turbo; advertising, sales promotion and personal selling

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(see Appendix I for Creative Execution Timeline). We propose that Porsche issue

out a press release prior to the execution of these elements (see Appendix J for

Press Release).

Advertising

The initial element of our marketing campaign is aimed to promote the

Porsche 911 Turbo towards the DBPs and consists of two types of advertising

mediums: printed mediums and internet advertising. More specifically, the

mediums selected are newspapers, magazines, and Internet advertising. These

mediums will be used to draw attention and create interest within the DPBs

segment by drawing attention towards the 2010 911 Turbo.

Printed Mediums

In order to reach the DPBs, our group is proposing an illustration that would

be presented in a static format. In the image, the original 1974 Porsche 911

Turbo is seen entering a mountainside tunnel at a high speed and exiting as a

2010 Porsche 911 Turbo. The image will mainly consist of a high definition

greyscale colour scheme, with the exception of the new model, which would be a

dark green representing freshness and wealth (Color Wheel Pro 2008). Below the

original and new model, the captions “Drive Fast” and “Feel Young” would be

printed respectively. The described image would be used throughout the different

printed mediums.

We intend to place advertisements of the 911 Turbo in the financial sections of

the newspapers. These newspapers would be national publications such as Global

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Mail and National Post. The reason behind advertising the 911 Turbo in the

financial sections is that it would allow Porsche to differentiate itself from its

competitors that are usually found within the automotives sections of newspapers.

We would also recommend a similar approach for magazines whereby Porsche

would promote the 911 Turbo in magazines such as Maclean’s and Forbes.

Placing advertisements in these types of magazines would again work to

differentiate the Porsche brand from other car manufacturers.

Internet Advertising

This age of the Internet has provided marketers with another opportunity to

reach customers in innovative ways. In regards to consumption time, the Internet

ranks third highest among the various media channels in Canada, only falling

behind television and radio (Charlebois et al 2009d). Our group intends to use a

30-second video commercial, such as the one we have created, as an introduction

to the Porsche 911 Turbo webpage with an option to skip the video. This

commercial would also be available on Porsche’s YouTube page, which currently

hosts over 4,000 subscribers with videos of reviews and advertisements (YouTube

2008). This gives Porsche more influence in its representation of its brand online

by being able to monitor the videos posted about its cars.

Sales Promotion

As a sales promotion, we recommend that Porsche gives away two round trip

tickets to Stuttgart, Germany upon a sale of a 2010 Porsche 911 Turbo. These will

be designated British Airways Premium Economy flight tickets, which will take

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the clients from their closest international airport to Stuttgart. In Germany, the

customers will receive a complimentary tour of the Porsche manufacturing plant,

and the Porsche museum. They will also have the opportunity to view their brand

new 911 Turbo directly from the factory. In addition, this would allow them to

have a chance to personalize some aspects of their vehicle. For example, they

could have their family name engraved into their steering wheel. This promotional

offer would specifically attract the DPB, as members of this segment are coming

into a higher level of disposable income, which allows them to pursue their

interest in traveling. This sales promotion is supportive of personal selling

because it gives the sales personnel one more tactic to entice the consumer to

purchase a 911 Turbo.

Personal Selling

Personal selling is most effective when the number of potential customers is

relatively small, because the seller can cater to the psychographics of each

individual. By understanding the mindset of the DPBs, Porsche’s sales team will

be able to create a more relationship-based approach to reaching this target

market. The relationship-based approach would be a preferred method when

compared to the traditional persuasive personal selling methods in the luxury

automotive category (Lamb et al. 2009f).

In pursuing the personal selling approach, our team recommends that the sales

personnel of Canadian Porsche dealerships should strongly encourage their

visitors to test-drive the 911 Turbo to create interest in that specific model.

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Furthermore, the employees should also provide their customers with

comparisons between the 911 Turbo and its competitors. When they do this, they

should highlight the reasons why their customers should purchase the 911 Turbo

rather than a competing luxury sport car; creating a preference for the Porsche

brand. When it is evident that the client is showing interest in purchasing the 911

Turbo, the Porsche salesperson could then inform them that there is a sales

promotion that is directly associated with the purchase of a 911 Turbo. As

mentioned earlier, this promotion consists of a round trip to Stuttgart, Germany,

to visit the Porsche facilities. Should this these techniques prove to be successful

it could lead clients to feel as though they are a part of Porsche’s legendary,

thereby increasing brand loyalty.

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Overview of Existing Porsche 911 Turbo Video Commercial

One of the vital forms of communicating to the consumer market for Porsche

is through its promotional videos for its cars. These videos can be found on the

company’s website, and also, on the company’s official channel on YouTube

(Youtube 2008). One of the videos on Porsche’s YouTube channel is labeled “911

Turbo – Personality”. This video captures and focuses on the various features of

the Porsche 911 Turbo, which include the new qualities that have been added to

the triumphant pre-existing traits. In the confines of a three minute and forty-two

second period, this video, with the aid of a variety of camera shots from different

angles, is successful in triggering pizzazz in the minds of the viewers to drive this

car. The video adds a unique persona to the vehicle, which would attract a

potential consumer.

Porsche, through this video, is targeting males in their forties, who are

pocketing a high level of income. This is evident through the footage of a man

depicting the aforementioned characteristics driving the Porsche 911 Turbo in the

video. Furthermore, these men have to be technology savvy, as the video

demonstrates an inbuilt Global Positioning System (GPS) and convenient outlets

for devices such as iPods and other mp3 players.

The communication objective of this video is to inform its viewers about the

characteristics of the Porsche 911 Turbo, as mentioned above. It also reminds

previous owners of the sports car about the standard of quality and design that

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Porsche boasts by mentioning the features the vehicle has maintained from past

models.

Regarding the evaluation element of advertising, Porsche is able to track

responses to this video through their YouTube channel. Subscribed viewers can

write comments, provide ratings, and add the video to their favourites. Therefore,

through these measures, Porsche can assess the success of their advertising.

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Modern World Marketing Co. 30-second video

The 30 second promotional video for the Porsche 911 Turbo that we have

created is focused on our target audience using a mixture of elegant and action

snapshots of the vehicle (Porsche 2009a). The background music chosen begins

with a light melody and compliments the still shots of the vehicle. The music then

picks up to become more exhilarating and the pictures follow this same premise.

In between some of the snapshots are enticing quotes found from reviews on the

911 turbo and the Porsche brand itself. These quotes add to the overall feeling of

the commercial and follow the theme we have been trying to portray to our target

audience. In conclusion, the commercial was made to look elegant, professional,

and simple to attract the deep pocket boomers.

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Appendix C – Porsche Product Mix Table

Source: Porsche 2009d

Appendix D – Porsche Perceptual Mapping

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Sport SUV’s Sport Cars Sedans

Cayenne 911 Carrera S Panamera S

Cayenne S Transsyberia

911 Carrera Cabriolet Panamera 4S

Cayenne GTS 911 Carrera S Cabriolet Panamera Turbo

Cayenne GTS PD Edition 3

911 Carrera 4S

Cayenne Turbo 911 Carrera 4 Cabriolet

Cayenne Turbo S 911 4S Cabriolet

911 Targa 4

911 Targa 4S

911 Turbo

Boxster

Boxster S

Boxster Spyder

Cayman

Cayman S

Product Line Width

Pro

du

ct

Lin

e D

ep

th

Source: Dietz 2007

Appendix E - Porsche Dealerships in Canada

Provinces Cities Address

Alberta Edmonton 17820 Stony Plain Road

Calgary 5512 Macleod Trail South

British Columbia

Vancouver 1718 West 3rd Avenue

Victoria 3329 Douglas Street

Manitoba Winnipeg 660 Pembina Highway

Nova Scotia Halifax 3367 Kempt Road

Ontario Toronto 265 Front Street East

Woodbridge 101 Auto Park Circle

Ottawa 611 Montreal Road

Quebec Laval 2455 Boulevard Chomedy

Saint-Laurent 3535 Ch De La Cote-De-Liesse

Charlesbourg 7777 Boul. Henri Bourassa

Source: Porsche 2009c

Appendix F – 2010 Porsche 911 Turbo Specific’s vs. Competitors

2010 Audi R8 5.2Yahoo Auto 2010 The Globe and Mail Automobile Magazine

MSRP $184,500 MSRP $184,500 MSRP $184,500

Engine 5.2 liter V10

Engine ‘””””” Engine ‘”””””

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Horsepower 525 hp Horsepower ‘””””” Horsepower ‘”””””

Max Speed 316 km/h Max Speed ‘””””” Max Speed ‘”””””

Source: Yahoo! Canada Co. 2009c; The Globe and Mail 2009c; Audi 2009c

2010 Aston Martin DB9 Coupe Yahoo Auto 2010 The Globe and Mail Automobile Magazine

MSRP $203,495 MSRP $203,495 MSRP $187,070

Engine 5.9 liter V12

Engine ‘””””” Engine ‘”””””

Horsepower 470 hp Horsepower ‘””””” Horsepower ‘”””””

Max Speed 306 km/h Max Speed ‘””””” Max Speed ‘”””””

Source: Yahoo! Canada Co. 2009b; The Globe and Mail 2009b; Automobile

Magazine 2009b

2010 Lamborghini Gallardo LP560-4Yahoo Auto 2010 The Globe and Mail Automobile Magazine

MSRP $198,000 MSRP $198,000 MSRP $198,000

Engine 5.2 liter V10

Engine ‘””””” Engine ‘”””””

Horsepower 560 hp Horsepower ‘””””” Horsepower ‘”””””

Max Speed 323 km/h Max Speed ‘””””” Max Speed ‘”””””

Source: Yahoo! Canada Co. 2009a; The Globe and Mail 2009c; Automobile

Magazine 2009a

2010 Porsche Turbo CoupeYahoo Auto The Globe and Mail Dealership

MSRP $165,300 MSRP $165,300 MSRP $165,300

Engine 3.8 liter Twin Turbo

Engine ‘””””” Engine ‘”””””

Horsepower 500 hp Horsepower ‘””””” Horsepower ‘”””””

Max Speed 312 kph Max Speed ‘””””” Max Speed ‘”””””

Source: Yahoo! Canada Co. 2009d; The Globe and Mail 2009d; Porsche 2009d

2010 Competitors  Brand Name Vehicle Name Price (MSRP)

Lamborghini Gallardo LP560 $ 198,000

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Aston Martin DB9 Coupe $ 203,495Audi R8 $ 184,500

Average $ 195,331Max $ 203,495Min $ 184,500

Porsche   911 Turbo $ $165,300

Comparable competitor vehicles chosen based on functionality, brand recognition and price similarity to the Porsche 911 TurboSource: Yahoo! Canada Co. 2009a; Yahoo! Canada Co. 2009b; Yahoo!

Canada Co. 2009c; Yahoo!

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Appendix G - Transactional and Logistical Functions

Types of Function

Description

Transactional Function

Contacting and promoting – contacting potential customers, promoting products, and soliciting orders

Negotiating – Determining how many G&S to buy and sell, type of transportation to use, when to deliver, and method and timing of payment

Risk Taking – Assuming the risk of owning inventory

Logistical Functions

Physically distributing – Transporting and sorting goods to overcome temporal and spatial discrepancies

Storing – Maintaining inventories and protecting goods

Sorting – Overcoming discrepancies of quantity and assortment by

Sorting out – Breaking down a heterogeneous supply into homogenous stocks

Accumulating – Combining similar stocks into a larger homogenous supply

Allocating – Breaking a homogenous supply into smaller and smaller lots (“Breaking Bulks”)

Assorting – Combining products into collections or assortments that buyers want available at one place

Facilitating Function

Researching – Gathering information about other channel members and consumers

Financing – Extending credit and other financial services to facilitate the flow of goods through the channel to the final consumer

Source: Lamb et al. 2009f

Appendix H: Population of Census Metropolitan Areas (CMAs)

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Provinces Cities Population

Alberta Edmonton 1,182,400

Calgary 1,124,200

British Columbia

Vancouver 2,271,200

Ontario Toronto 5,531,300

Ottawa 1,198,700

Quebec Montreal 3,750,500

Source: Statistics Canada 2009d

Appendix I: Creative Execution Timeline

Month/Date Type Description BenefitsDecember 1st, 2009

Press Release 2010 911 Turbo, Launch date of Model, Price

December 9th, 2009

Launch of Website: www.drivefastfeelyoung.com

Presents commercial for the first time and outlines up to date information on the 2010 911 Turbo Model. Allows visitors to comment on the website

This advertising medium will allow Porsche to gauge the interest of the DPBs segment

December 15th, 2009

Maclean’s & Forbes Canada weekly magazine

The initial release of the 2010 911 Turbo marketing image. Will also describe the free flight promotion upon purchase of the vehicle

Will focus on targeting the DPBs and visually expressed the meaning of “Drive Fast. Feel Young” slogans

December 24th, 2009 and other week

Calgary Global & Mail and National Post

Periodically posting the marketing image in the Financial section in Newspapers. Will describe the free flight promotion upon purchase of the vehicle

Will allow the Porsche communication mix to attract the DPBs’ that have not been introduced to the marketing image.

April – September (6 months)

Personal Selling These months will be the high season for the purchase of sports cars. During these months, Porsche Dealership Personnel need to create an image of

Can result in high sales and greater revenue. Increase in brand loyalty

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Quality, Luxury and Reliability in the mindset of potential Porsche Clients. Sales personnel will use the Flight promotion to create sales.

Media Costs:1. Maclean’s weekly magazine (one time) = $32 600.002. The Globe and Mail (National one time) ½ page, Black + 1-Colour =

$8204.00Source: Charlebois et al. 2009d

Appendix J – Press Release

MARKETING 317 L08 Marketing 317 L08Haskayne School of BusinessUniversity of CalgaryModern World Marketing CoPhone (403) 220-2120Fax (403) 220-2121

Contact: Modern World Marketing CoPhone: (403) 220-2120

FOR IMMEDIATE RELEASE4 P.M. EDT, November 23, 2009

New Porsche 2010 911 Turbo coming to CanadaNew Porsche 2010 911 Turbo coming to Canada

PORSCHE CANADA IS GETTING READY TO LAUNCH ITS NATIONAL MARKETING CAMPAIGN FOR THE 2010 911 TURBO

CALGARY, AB, NOVEMBER 23, 2009: ---Porsche Canada Ltd. will debut its 2010 911 Turbo in all dealerships across Canada on January, 2009. The seventh-generation of the 911 Turbo comes more advanced, sleek and more horsepower

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driven than ever before. With new titanium coated slats, leather trimmed seats and many other improvements; the new 911 Turbo has so much more to offer Porsche lovers.

Porsche is scheduled to launch a website on December 1, 2009 that will present the new 911 Turbo slogan, “Drive Fast. Feel Young”. The corporation will introduce the remainder of its marketing campaign beginning in the middle of December. This will include a giveaway of two Premium Economy roundtrip tickets to Stuttgart, Germany, when a person buys the 911 Turbo.

The new generation offers a 3.8L twin-turbo engine with 500 horsepower. In addition, with new technological advancements in the automotive industry and the ever-growing environmental trend, Porsche has worked to release a sports luxury vehicle that meets consumers’ demands. The 911 Turbo uses significantly less fuel and, when compared to its competitors, it has reduced its CO2 emissions by 18 percent.

The 911 Turbo model allows drivers to experience the latest technologies. Some of these innovations include the optional three-spoke steering wheel with gearshift paddles, which provide users with a convenient alternative to the traditional way of driving. With a new variable torque distribution technology, the 911 Turbo allocates its power between the rear wheels, allowing drivers to be more accurate and responsive when taking their Turbo for a ride. The new 911 Turbo is the thrilling yet elegant escape. Whether it is a trip to the countryside or a night on the town, the 911 Turbo is the ultimate adventure. Drive Fast. Feel Young.

Pricing for the new 2010 Porsche 911 Turbo starts $165,300 CDN. Please see your local Porsche dealership for more details.

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