Question

Market Research–Round 1: In the late 1950s, when Americans were trading in their old cars for new ones every year or two, American automobiles were getting bigger and bigger. The demand for ever-larger, more powerful V-8 engine cars seemed unstoppable. At least one American auto manufacturer, Ford, realized the trend could not continue indefinitely, and that at some point consumers would begin to prefer smaller cars again. The question was when that shift would occur—and how to be ready for it. At the time, Ford was concerned enough that it conducted market research on consumers to determine their preferences for the cars Ford would be producing in the next few years (designing a new model of car takes several years). By the early 1960s, Ford had determined through extensive personal interviews of consumers that demand was building for a “simple, compact, no-frills, fuel-efficient sedan.” Accordingly, Ford introduced the Ford Falcon, a compact new model with a relatively low price because of its having few options, a manual transmission, and a small engine size (good for fuel efficiency). By keeping the car styling plain, Ford also kept the cost of the car down. However, sales of the new Falcon were not very successful, so Ford once again conducted market research to understand why. Market Research–Round 2: This time, when interviewing consumers Ford did not ask “Describe the kind of new car you would look to buy,” as they had the first time. Instead, it asked the consumers to “Describe the kind of new car your next door neighbor would look to buy.” On the basis of their responses, Ford introduced yet another new model, the sporty-looking, 2-door Ford Mustang. [Historical note: The new Mustang was essentially the same car as the Falcon—just the body shape of the car was changed, little else.] The Mustang was very successful (it is still in production today). A few years later the Falcon was phased out of production. Today, the Falcon is widely regarded as a failure and the Mustang as a great success story. Question: (a) How would you explain what Ford’s error was when it conducted its first round of marketing research? (b) How did it correct that error in the second round?

Answer 1

ANS I in round 1 although Ford had conducted right marketing research but the error was that the product was not able to fulfill the consumer demand, they failed to identify and attacking a particular segment, it was just a car and not a great performing cost effective cars, it was a plain car with not many features having few options.they focus only on low price car,  another reason was data collection in marketing research in which lots of personal interview were taken but there was no proper evaluation and proper training and supervision was conducted to find the needs and desires of consumers , the sample collection was in error and it did not defines the right information needed , hence Ford falcon fails to attract consumer

ANS 2 in round 2 Mustang became successful as they now target the right consumers and try to identify their needs and wants, which concluded that car was also required which increases their status and prestige among their society, getting a sporty look car at low price fulfill their desire .and sample collection and data analysis proved to be worthy. Therefore Mustang is still in demand