Question

QUESTION 2
In spite of challenging conditions that had an impact on new vehicle sales, 2012 saw yet
another record being set for the Malaysian auto industry as the Total Industry Volume (TIV)
finished off at 627,753 units. This was a 4.6% increases (27,630 units) over 2011’s TIV
which now becomes the second highest in the history of Malaysian new vehicles sales.

2 a. In the light of the above scenario, explain THREE (3) appropriate bases of
segmentation that international car manufacturers such as BMW, Volkswagen and
Lexus segment the Malaysian car buyers.

2 b. How should they go about the segmentation process?

2 c. Select and justify the most suitable positioning strategy that you would suggest for a
South Korean car manufacturer as a new competitor entering the Malaysian car
market with the long term goal of market dominance.

Answer 1

1st Basis:

The international companies should segment the market based on the customer preference and car models buying trend, whether they are going for luxury or economy cars. This will allow them to work on the budget of cars, and roll out their designs in the favourable price rangel.

2nd Basis:

The international companies should study the local competitors in terms of their working style and marketing strategies. This will allow the international companies to segment their customers in more depth and understand their behaviour and emotions towards the selection patterns.

3rd Basis:

Thirdly, the international companies should study government policies that might have changed in 2012, including taxes and benefits, which could be impacting the sale of locally manufactured cars. This would help the international companies segment not just the customers but also the competitors to work on their own perfectly fit strategy.

2.a) The international companies should segment the market in two phases. In the first phase they should analyse the customers to study their buying patterns and reason for choice. And in the second phase the companies should study the competitors to analyse their price ranges and marketing strategies.

Moreover, if a South Korean car manufacturer enters Malaysian market they should go for economy cars, as in malaysia there is lot of local work, and both males and females work in high proportion for which they use their own vehicles which are cheap and can be used in daily life just for commuting, rather than using it for Luxury.