Questions:

1. What are the various market targets for the New Beetle available to Volkswagen? Describe each both demographically and psychographically. What are the pros and cons of each option? What are the appeals of the New Beetle to each group?

There are two main target audiences for the New Beetle - baby boomers and younger generation (18- to 34- years-old). The customers were demographically diverse like gender, life cycle, occupation or education etc. but share some common psychographic characteristics.

Demographically: The baby boomer had family and children and stable job. The younger generation was single or married without children, having unique and active lifestyles.
Psychographically: he baby boomer had strong emotional connection with Beetle and young people saw Beetle as a representative of their personality. They both appreciated an inspiring design and German engineering.

For baby boomers,
Pros:
1. They had strong emotional tie with the old Beetle. The new Beetle was considered as reminds of cherished memories and made them nostalgia. 2. They had been working for many years, so that they could afford the price of at least $15,200. 3. Print advertising could reach baby boomer most cost-effectively.
Cons:
Since baby boomers were having a family, they probably preferred larger car like SUV or minivan.

For younger generation,
Pros:
1. They thought Beetle is fun and had the connection with Beetle such as personality or dream. 2. They liked the design of the car.
Cons:
The price is not affordable.

For both baby boomers and younger generation
Pros:
We could reach a larger audience.
Cons:
The cost of advertising would be high.

2. What positioning (marketing approach) options are available to Volkswagen for each of the target markets? Describe each. What are the risks and opportunities of each? How would you differentiate each from competition?

For baby boomers, positioning option would be “indulging in nostalgia”. The new Beetle would remind the baby boomers of their history of owning the old Beetle. The opportunity was that baby boomer could afford the car, whereas the risk was taht they might prefer a larger car. They did not have strong emotional tie with Japanese car or other luxury German car.
For younger generation, positioning option would be “personal car”. Young people were more focusing on their feelings. They want to show their personality. The opportunity was that the unique design attracted young people, whereas the risk was that they might not afford the car. They could be seen as people with personality and drive German car with a relatively low price.

3. Which target market(s) do you recommend for Volkswagen? What positioning should they use?

In my opinion, for small car like new Beetle, we should focus on the target market of younger generation. There was no practicality for baby boomers unless they had strong emotional connection with old Beetle and were rich enough to afford a second car. However, for younger generation, they might not afford BMW or other luxury German cars, but they might want new Beetle for economical reason and to show their personality. Therefore, the new Beetle might be their first car ever and it would be the starting point of accepting the brand of Volkswagen for long-term consideration. To solve the problem of affordability, we could offer financial services for young people, so that they could drive their dream car with an affordable down payment.

We should use the “personal car” as the positioning option. Because we could attract young people who had active lifestyles as well as reminding baby boomers of their passionate, crazy and rebellious youths.