Chevrolet: 100 Years of Product Innovation
Marketing Strategy Case Analysis
Megan Byas
November 21, 2014
Advance Marketing Strategy

Introduction: Chevrolet It is not uncommon nowadays in our business industry for products and services to be created merely out of competition with an existing product or service. In the historical case of
Chevrolet, they were one of the original companies to be created out of competition in 1911 against Ford Motor Company. Ousted by his initially founded company, William Durant made
Chevrolet his primary focus in soon creating different vehicle models. The brand named after a top racer, Louis Chevrolet, soon became one of GM’s most popular brands. Before the Great Depression, Chevrolet sold one­third of America’s cars, and positioned itself as cutting­edge, equipping vehicles with innovative technologies and forming joint ventures with other competitors. Chevrolet has over the last 100 years expanded its vehicle portfolio to tailor to numerous consumer markets, and transitioned from an American icon into a worldwide brand known for quality and durability.

SWOT Analysis

Strengths: company such as Chevrolet with a history of automaking for over a 100
A
years logically would have numerous strengths within the company. The company would not continue to exist and be as dominant in the motor vehicle industry if it did not have more strengths than any other aspects. Some of the strengths involved with Chevrolet begins with the fact that the company is over 100 years old. The tradition and history of the brand is something that can be closely related and tied to families and life experiences of the consumers. Also, the fact that the company is American made company, one of three existing today, is a strength for the company. Chevrolet has a high brand loyalty because of its outlasting existence, and focus on high quality and durability. Therefore, the company also has a high brand equity that makes it hard for the company to experience occasional hardships from lack of purchases from consumers. Diversification with the vehicle product portfolio is also a key asset and competitive advantage that Chevrolet has over a lot of its current competitors. Finally, the last two main strengths that Chevrolet maintains currently is event sponsoring and planned product obsolescence. Theses two main marketing concepts are what keeps Chevrolet relevant after so many years.

Weaknesses: Chevrolet is definitely a strong brand, there are always flaws and faults
While
that are to be acknowledged. For instance, the various discontinued and recalled vehicles regarding safety issues and poor quality, have occasionally given Chevrolet bad publicity.
Another weakness was the failure of Chevrolet attempting to transition its brand’s name. Chevrolet wanted to eliminate the word “Chevy,” to avoid any confusion for the consumers looking to purchase vehicles from Chevrolet. While the concept was solid, the idea was bad overall and left alone to be called whatever consumers felt comfortable calling the brand. Ultimately, none of these weaknesses top the GM’s bankruptcy and bailout of 2008. Even though it was not Chevrolet who needed the bailout, there alliance and association with GM, put them at a disadvantage. Opportunities:
Chevrolet undoubtedly does a good job at seeking opportunities to grow and stay relevant as a company with the various trends throughout the years. Currently, technology is being used now more than ever by numerous consumers, and modifications for better technologically advanced vehicles are being designed. This is a great opportunity for Chevrolet and in fact they are currently ahead of the competition somewhat: “ the nearer term, vehicle
In
connectivity has big brand implications, especially at Chevrolet, which will launch 4G LTE connectivity in some 30 models” (“Audi, Chevy and Lincoln Plan to Boost Ad Spending in
2015” ­ AdAge). Sociocultural trends are another great avenue of opportunities for Chevrolet to grow as a company and stay relevant. Chevrolet should choose to stay developing the best possible eco­friendly vehicles with the best gas mileage, because soon that will become more and more of a trend. They began with the electric and hybrid vehicles, but that is just a small sample from their overall portfolio of vehicles. In futuristic terms, people are becoming more environmentally friendly and still would prefer to save on gas as much as possible. Economically, with gas prices being lowered over the past few months to a year, the purchasing of trucks may increase again as they did after gas prices dropped under $4 a gallon.
According to USA Today, “Chevrolet and GMC likely will spend more marketing money and energy on its full­size pickups and SUVs this year. In March, Chrysler's Ram pickup outsold
Chevrolet Silverado for the first time that anyone in the automotive industry can remember”
(“GM Stick with Marketing Plan Despite Recall”). With Chevrolet’s SUVs being outsold for the first time and gas prices constantly lowering, they should now have more of an incentive to push to sale more full­size pickups and SUVs.

Threats: the very beginning of the establishment of the company, Ford Motor Company
From
has been one of the key threats to Chevrolet’s success. Competing in the same industry for the same market of consumers, makes every marketing strategy move that more precise. Ford has a slightly longer history of existence than Chevy, with also a slightly higher accreditation as an
American automaking brand. Their family branding approach makes them even stronger with the attachment of consumers to their Ford brand. Another threat (and weakness) of the company, is their alliance and association with GM.
Chevrolet’s attachment to GM has Chevy suffering unintended consequences. For example, the
2008 bankruptcy and bailout was not only a bad look for GM but Chevrolet as well. And now another bad unintended consequence has happened to Chevrolet through their association with
GM.

GM earlier 2014 has had to recall 2.6 million small cars for defective ignition switches.
Information from the AdAge article suggests that Chevrolet is not handling the crisis as effectively as they should, “ very public nature of the recalls, including the 2.6 million small
The
cars recalled for defective ignition switches that are now linked to at least 21 deaths, and widespread coverage of the company's handling of the crisis, has meant Chevrolet has not had to devote significant resources to countering the publicity” (“Audi, Chevy and Lincoln Plan to
Boost Ad Spending in 2015” ­ AdAge)
.

Marketing Strategy: Then & Now

Then: the beginning, Chevrolet positioned itself strongly as a theme of “quality
In
vehicle with deep roots in America’s past. Priding themselves on the traditional representation of the sporty car brand, Chevrolet has made great strides over the years. Firmly entrenching the brand as a key part of the American culture, Chevrolet has made many attempts to associate with
American sporting events. For example, Chevrolet sponsored the All­American Soap Box Derby for a decade. In addition to sponsoring events, Chevrolet also sponsored drivers with their vehicles for racing circuits such as NASCAR. Another subcategory Chevrolet used along with the American theme was patriotism in its promotional aspects. Taglines with the phrases “America’s Best Seller,” “America’s Best Buy,” and “Like a
Rock,” were all famous for reminding consumers about Chevy’s great history as an American leader for automaking. This was perhaps the biggest aspect of Chevrolet’s branding as a company in the United States. However, when it came to Chevrolet as a leading automaker overseas, four values represented the company to their foreign consumers: durability, value, practicability, and friendliness. Many of their various taglines surrounding these values create

strong brand cohesiveness. Although Chevrolet has adopted more of a global brand strategy, it still customizes its branding to appeal to certain markets. Now:
Currently, Chevrolet is making plans to launch new vehicles and continue advertising and promoting their brand to consumers. Despite the recall at the beginning of the
2014 year, according to Chevrolet’s marketing leaders,“...the automaker is not spending more on advertising or incentives than previously budgeted and isn't likely to change that strategy” (“GM
Stick with Marketing Plan Despite Recall”­ USA Today). The plan is to focus on the product and not the publicity of trying to defend themselves as a company. Therefore, there will not be a recall ad and instead there will be just ads showing new products introduced recently. As stated before, Chevrolet is looking to spend more marketing money and energy on its full­size pickups and SUVs this year. On the other side, Chevrolet is using the NFL Superbowl in hopes to boost not only national but global awareness with its ads. Chevrolet continues to also sponsor sports with “
Chevrolet's jersey sponsorship with English soccer club Manchester
United...will put the Chevrolet bowtie logo in front of the club's worldwide fan base of some 700 million people..” (“Audi, Chevy and Lincoln Plan to Boost Ad Spending in 2015” ­ AdAge)
.
Chevrolet’s current marketing innovations regarding technology with 4G LTE in its vehicles also proves that Chevrolet plans to remain relevant with consumer wants and needs.

The GMC Problem Chevrolet’s biggest problem is in fact it’s biggest company supporter, GMC. GM is the starting point for Chevrolet, yet it has been not once but twice in a position that jeopardizes the equity of the Chevrolet brand. GMC is the problem for Chevrolet because of their bad publicity regarding the 2008 bailout and 2014 recall crisis thus far. As mentioned before, Chevrolet’s association and alliance with GMC causes them to have a bad reputation at times, even with
Chevrolet’s freedom to stand on its own as a brand. In the case of GM, the company’s bankruptcy and subsequent bailout had the ability to contaminate its four brands of vehicles, in spite of their individual merits. Therefore, Chevrolet has to figure out how they are going to deal with the bad publicity domino effect that falls upon them every time GM fails.

Recommendations Even with a company as successful as Chevrolet, there is always room for improvement.
Tactical modifications that can be made to enhance the Chevrolet brand’s equity to remain substantial while in alliance with GM could be examples of: brand decisions to enhance self­image and product loyalty, increasing brand value from recognition and preference to brand

insistence for their products, and focusing slightly on marketing strategies for ethical and social responsibility if they continue to be a part of GM. Chevrolet is a high quality brand nonetheless, however, they focus on American vehicle tradition where they could take a step back and focus on the consumer. If Chevrolet would reposition a few of their vehicles to show how it would enhance the self­image of the consumer driving a sporty yet luxurious car, there is a possibility they will get great feedback in sales.
Consumers currently are looking for mass customization products that can be used on every level of purchasing decisions. Therefore, it would a smart move for Chevrolet to focus on the consumer even more as the “person behind the car” (“man behind the mask”), while still including valuable information about the car itself. In turn, efforts such as enhancing self­image will directly influence product and brand loyalty when the consumer realizes the importance of the consumer to the brand. Secondly, Chevrolet could increase the brand value of their products to make them less of a recognition and preferred products, and more of the insisted products. Chevrolet understands and for years know that they are not the only successful American automaking company in the
United States. They should want to strive to be not only the top choice but the “only” choice to many consumers. Third and last recommendation involves Chevrolet immersing themselves more in the ethical and social responsibility when it comes to GM. If they chose to continue being with GM then they will have to step up and defend themselves against bad publicity when something goes wrong. Even to some extent, help defend GM as well if the situation is needed.

Conclusion Overall, Chevrolet is a really good company with what seems like really good values and tradition to base its foundation. However, the same thing that can be a benefactor to Chevrolet by being in business with GM can be its downfall. The best thing for Chevrolet to do in the future is to better learn how to handle and acknowledge the problems faced with GM. For if they are as great as they appear to be, plan to continue hearing about them in the next half of a century embarking on more innovative initiatives.