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Final Marketing Plan

MKTG 489

Elspeth McGlocklin
Colton Miller
Jachan DeVol
Sean Cohen
MKTG 389

Executive Summary:
This report was commissioned to examine the industry, the potential, and the methods
for success for Alfa Romeo upon their reintroduction to the United States after a twenty-three
year absence. After extensive research Torque Consulting has developed a 12-month pulsing
Marketing Plan to achieve a goal of market share growth.
With a narrowly defined sub-segment Experiential Purists, we are able to create a
targeted product value proposition and marketing strategies it ensure it efficiently achieves our
intended audiences. For drivers who are seeking a pure driving experience, the Alfa Romeo 4c
provides more value than the corresponding Porsche and Chevrolet models by offering a
product that features the most race car like metrics, filling a hole in the minds of our subsegment, and communicating it through breakaway and hostile branding techniques via print,
digital, and personal sales channels. This results in a differentiation advantage, with qualitative
features that are difficult to replicate. The ultimate goal for reentering the US market is to grow
and capture market share. Our timetable and measurable objective for the 2015 year is to sell
1,000 vehicles (see images below), which is the first year production limit. Given this key
performance target, a market share of 4.3% must be earned with an approximate 2015
Marketing/Advertising budget of $605,000.00.

*Alfa Romeo

Alfa Introduction
Alfa Romeo began in 1910 as a result of the acquisition of shares in Societ Italiana
Automobili Darra by Cavalier Ugo Stella1. Societ Italiana Automobili Darra was an Italian sports
car maker and thus is responsible for the Italian racing origins of the firm. Alfa Romeo turned
heads again when its Spider Duetto was featured in the 1966 film The Graduate where it was
driven by famous actor Dustin Hoffman2. From its humble beginnings Alfa has grown to be
internationally renown for stylish and innovative automobiles characterized "...by the pure
Italian style of sporting coupes, combining pleasure with elegant, seductive styling" 3.
Furthermore, the firm aims to ...offer all the driving satisfaction of a top-performing coupe
without compromising comfort or practicality...4.
After being sold to Fiat in 19875 Alfa has struggled to find its niche within the Sports Car
market and failed to capitalize on its rich racing history in creating points of differentiation. The
firm is steered by innovative CEO Harald Wester and a staff of 2,900 in Italy. Plus, Alfa is also
heavily influenced by Brand Director Sergio Cravero. Cravero has been vital to separating the
brand from perceptions of poor quality and underperformance. To combat these perceptions
Alfa depended on Skunkworks6, a research and experimentation lab created by Fiat/Chrysler,
where they could reengineer their vehicles with their roots in mind. The recent US relaunch was
largely made possible by the Skunkworks Lab, which helped the firm reinvigorate their current
offerings and innovate new ones. Notably, Wester is also CEO of Maserati, another Fiat
Subsidiary. This appears to be the reason Alfa Romeo has been able to easily gain access to
Maserati Dealerships for expedited distribution with its recent relaunch into the United States 7.
This launch comes after an approximately 20-year absence from the American Automobile
Industry, specifically sport car segment, due to costly regulatory compliance issues. The firm
1

"Alfa Romeo: Car History & Museum | Alfa Romeo USA.". N.p., n.d. Web. 07 July 2015.
Ebhardt, Tommaso. "Fiat Finally Tries To Tune Up Alfa Romeo." Business Week 4373 (2014): 26-27. Business
Source Complete. Web. 7 July 2015.
3
"Beauty That's More Than Skin-Deep." Finance Week (2005): 48-50. Business Source Complete. Web. 7 July 2015.
4
Ibid.
5
"Alfa Romeo: How Badly Does VW Want It?." Black Book - Fiat Spa & Fiat Industrial: Divide & Conquer (2011):
201-209. Business Source Complete. Web. 7 July 2015.
6
"Investor Day: Alfa Romeo." (n.d.): n. pag. FCA Group (Fiat Chrysler). Web. 9 July 2015.
7
Ciferri, Luca, and Larry P. Vellequette. "Will Alfa Romeo 4C Bypass Fiat Stores?." Automotive News 88.6588
(2013): 3-24. Business Source Complete. Web. 7 July 2015.
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currently has annual revenues between $800-899.9 Million8 with about 68,000 vehicles sold
internationally last year.

Marketing Goals and Objectives


Goal: By reentering the US market, Alfa Romeo will find more customers to buy their product
thus capturing a larger slice of the market share in the industry they identify with. In order to
achieve our goal, we must earn approximately 4.3% of the market share.
Objective: Our key performance target intended towards helping us achieve our goal is to sell
1,000 vehicles in 2015.
The table below provides data from United States sales of vehicle make and models that
construct our defined industry. The absence of certain makes or models such as Lotus or Audi
TT is due to the minimal amount of units sold in the US this past year (120 units sold by Lotus,
14 Audi TT units) having no impact on our intended market share. For the sake of this project,
we will assume this goal is for the 2015 year, and since the May 2015 year-to-date was the
most relevant and accurate number we could track down, we will assume the data to the 2014
year9.

Vehicle

May 2015 YTD

May 2014 YTD

% Change

May
2014
3,328

% change

3.2%

May
2015
3,514

Chevrolet Corvette

15,500

15,021

BMW Z4

967

1,099

-12.0%

78

108

-27.8%

Porsche Cayman

1,376

1,562

-11.9%

304

312

-2.6%

Mercedes-Benz SLClass

1,898

2,173

-12.7%

420

458

-8.3%

Porsche Boxster

1,245

1,772

-29.7%

307

411

-25.3%

Mazda MX-5 Miata

2,214

2,251

-1.6%

449

530

-15.3%

Total

23,200

5.6%

1000 = Alfa Romeo production limit, 2015 units sold goal


23,200 = Relative industry vehicle unit sales of last year
1000/23,200 = .043 = 4.3%
Market leader = 15,500 units sold Relative Marker Share (goal) = 6.5%

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9

"Company Profile: Fiat Auto Alfa Romeo." Corporate Affiliations. LexisNexis, n.d. Web. 7 July 2015.
"GOOD CAR BAD CAR." May 2015 YTD U.S. Vehicle Sales Rankings. N.p., n.d. Web. 28 July 2015.

Segmentation
We have conduct indirect segmentation in order to group our potential customers based on
common needs, benefit sought, and identifiers. Below are our three segments based on our 3cirlce findings:

Experiential Purists
The Experiential Purists are looking to engage in an
unparalleled driving experience that is unlike
Everyday
Experiential
anything they have ever experienced before. They
Driver
Purist
are looking to be transported back to the first time
they got behind the wheel and felt the immersive
thrill of that first drive. The driving experience will
Mr.
allow them to feel the endorphin rush of the
Materialistic
technologically advanced, exquisitely designed, and
racing infused 4C Coupe. The 4C is designed to flawlessly
interact with the road and the driver, giving them a pure driving
experience that results in an emotional high which they are seeking. These individuals can be
identified by their risk taking tendencies, attraction to the rush of an adventure, and admiration
for state of the art technologies. Additionally, they are extremely competitive and enjoy the
intoxicating essence of the ride. They evaluate their consideration set of vehicles based on their
technical specifications, performance, and reputation. The Experiential Purist is less likely to be
as concerned about the interior, accessories, or add-ons because those factors only detract
from the purity of the driving for car and driver.
Segment Value Proposition:
For Experiential Purists Alfa Romeo offers an unparalleled driving experience that will be
reminiscent of the adrenaline rush of the first time you drove a car. Prepare to feel as one
with this machine.
Need Transportation Everyday Drivers
Everyday Drivers seek a stylish, yet economical driving option that transports them from point
A to point B. They can be identified by living in Urban or Residential areas where public
transportation is unavailable, or socially unacceptable amongst their social class. Furthermore,
they earn an above average income with the ability to be selective about their purchases, which
enables them to buy a luxury vehicle, such as an Alfa Romeo, but they havent considered it

before. Everyday Drivers need to convey a sense of affluence to their peers, but are solely
looking to transport themselves and not a family, which creates one less evaluation criteria.
Additionally, they are likely to own another vehicle in which they do the majority of their
recreational activities (Camping, Road Trips, etc.) or transporting multiple passengers in
another vehicle such as a Sedan or SUV. This is currently a non-consumer of our offering, but
given the right conditions they could be persuaded by our unique offering as long as they could
be shown the benefits they stand to gain should they join team Alfa.
Segment Value Proposition:
Reimagine your commute with the technologically advanced; fuel efficient, and luxuriously
designed Alfa Romeo. Upgrade your drive to work to an exhilarating experience unlike ever
before.
Desire Status Symbol Mr. Materialistic
Mr. Materialistic is extremely concerned with the social self and the image the project to
others. Notably, being materialistic, self-focused, and constantly seeking the newest
innovations can identify them. They are likely to flaunt their possessions in the Cities and Urban
Area they reside in to gain external validation by their peers. Psychologically they feel a need to
outwardly express their achievements or possessions because of an inward insecurity or life
dissatisfaction. Their other purchases are often flashy, such as jewelry or fashion pieces, convey
a sense of affluence (such as multiple cars or home-ownership), and enjoy their membership to
social groups (such as car clubs or sports league) that further convey their accumulation of
wealth. They are extrinsically motivated to satisfy these unmet needs through acquisition of
goods especially when the goods are portrayed as social status signals in marketing and
advertising efforts.
Segment Value Proposition:
For Mr. Materialist the purchase of an Alfa Romeo offers a unique status symbol to signal their
social affluence, appreciation of emerging technologies, and to their peers .

Targeting:
The specific segment we are going to target is the Experiential Purist. Alfa Romeo has long been
a prestigious brand, steaming from their accomplishments in competitive racing on the world
stage. This close connection with their racing heritage resonates with Experiential Purists
specifically. The general car market is extremely competitive and the sports car sub-segment of
that is just about as competitive. In order to focus our targeting and marketing efforts we
established the sub-segment or 2-Seat Luxury Sports Coupes as the jumping-in-point into the
US market. The relationship between 2-Seat Luxury Sport Coupes and the Entertainment
Seeking drivers is strong. Going forward, we believe that Alfa Romeo should target the
Experiential Purists, who are looking to engage in an unparalleled driving experience that is
unlike anything that the competition is putting out. These passionate drivers are constantly
looking for the purest and most engaging entertainment out of a car and Alfa Romeo is in the
best position to fulfill that desire and longing. If you step back and boil down the sports car
market until you get to its most fundamental elements you will find engaging driving,
uninterrupted technology, and beautiful design. If one of these three are missing then the car
will be flawed and unappealing to Experiential Purists who are finding their joy and
entertainment from an uninterrupted, engaging and thrilling driving experience.

Positioning:
We will be employing a Strategy-Niche, Small-Market positioning to reach the Experiential
Purists in the most efficient, cost-effective ways.
For the purist of drivers, Alfa Romeo provides the most engaging and entertaining driving
experience in the two seat, luxury sports cars. We will focus exclusively on the emotional
appeal this sub-segment seeks, rather than irrelevant metrics such as 0-60MPH, performance,
and safety ratings. Flipping these typical negatives into positives for this segment is leveraging
Alfa Romeo Core Competencies and Competitive Advantage.
However, it holds true that metrics determine behavior. However what happens when a new
players enters a market, and creates its own metrics to behave by? Alfa Romeo has positioned
itself not beside its obvious product competitors, but by racing supercars that thrill seeking
drivers have always unrealistically aspired to own, filling this whole minds of our sub-segment
rather than following the market leader. The most relevant metrics that the assumed industry
measures are Horsepower, Top Speed, and 0-60. Among these metrics the Alfa Romeo 4c
places last against its top two competitors (Porsche Cayman, Chevy Corvette)10. Alfa rather
10

Alfa Romeo 4C - Car and Driver." Alfa Romeo 4C Reviews. N.p., n.d. Web. 23 July 2015.

focuses on metrics that make for both a breakaway and hostile positioning strategy. Some
quantitative, and some qualitative, Motor Trend explains The 4cs bullet points are an
enthusiasts dream list. These bullet points consist of a curb weight under 2500 pounds, a twin
clutch transmission (same as Ferrari), a high power to weight ratio, no steering assist, and
embracing the sound of the turbocharger, which most automakers cover up. As any sports fan
would understand, what makes it onto the stats sheet isnt always what wins you the game.
Focusing on qualitative advantages is extremely difficult to replicate directly and simultaneously
contribute to both our positioning strategy as well as differentiation strategy for maximum
success. Below are a few examples of social listening that revealed a similar sentiment amongst
this segment:
You dont buy this to get from one place to the other Motor Trend
You think of ways to extend your route home Motor Trend
Its an Italian car with soul not an emotionless computer made by ze Germans -anonymous
No steering assist, manual rack. If you spend a lot of time in cars with steering assist, you
forget the joy that a manual rack can bring to the equation

Marketing Implementation
In order to accomplish the marketing goal of selling 1,000 units of the 4c coupe by the
end of 2015 Alfa Romeo will utilize in-store, selective print advertising, digital and social
channels to reach the Experiential Purists. These channels will efficiently deliver advertising
messages and promote the announcing of Alfa Romeos US reentry. Alfa Romeos
communication strategy will utilize a 12-month pulsing media strategy beginning as of January
of 2015. Alfa Romeo will sponsor a number of events during this 12-month period, including:

Track Day (specifically San Diego market)

Top Gear Show Special

Youtube Channel

Website and Inbound Marketing (Push Strategy)

Auto Shows across the country in regionally acclaimed

These events will bring forth the Experiential Purist community to have them truly know this
product from the ground up. Each event will display the specs of this track ready car that
delivers pure performance to the public. We will hold a Track day event once a month in a
different state across the country. This will help with word of mouth and give our car a supercar
appearance that the public will love and desire. With these in-person events we will also
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showcase the 4c coupe in print. Although print is a declining industry, we would like to put
some of our budget towards it to capture the most of our target market as possible. We
recognize that some of the identifiers of our segment correlate with Demographics such as age,
gender, and media habits we have decided to target Magazines such as:
Forbes,
Times,
Motor-Trend
These channels will bring in the most Gross Rating points when it comes to reach and
frequency of viewing of our segment, which is the ultimate goal of our Plan. Our strategy is to
ensure that our advertisements are four-colored full-page ads that are found on the back cover
of the magazines. This space was specifically selected because this is the most viewed page in
Magazines, besides the cover. Ultimately, these magazines will highlight the specifications that
aren't noticed or obvious when driving the car. Such as the: Carbon fiber hub, exhaust system,
brake system, and weight of the vehicle making this channel ideal for these specifications.
Additionally, below we have allocated a budget for the variety of marketing activities. Based on
extensive Marketing Research of the New Car Industry we have identified that on average 1.1%
of Total Revenues are allocated to Advertising Expenditures. Alfa Romeo will produce, and
hopes to sell, a total volume of 1,000 in 2015. On average the cost of each vehicle is $55,000,
therefore Total Revenue is approximately $55 million, which results in a $605,000.00
Marketing/Advertising budget. According to the National Automobile Dealers Association
$616.00 in advertising costs is spent per vehicle, which is the basis for our forecasts.

Activity

Percentage of Overall Marketing &


Advertising Spend

Total Spend

Digital Advertising/Marketing

23.6%

$142,780

Print Media

10.4%

$62,920

Promotional Events

66%

$399,300

*IBIS World/ National Automobile Dealers Association

Evaluation and control


We will use several metrics to evaluate the success of our marketing plan. We will measure a
variety of external metrics, listed below, to evaluate whether or not our sales and market share
goals were achieved. Monitoring Alfa Romeos market share amongst Experiential Purists, and
the general car seekers, will indicate whether our marketing plan is targeting the right
individuals, and make necessary adjustments in a timely fashion. The market share for Alfa
Romeo as a company is hoping to reach 4.3% of the market by the end of 2015 given a budget
of $605,000.00. Below are the metrics we will use to measure our success:
External:
Net Sales
Net Promoter Score
Market Share
Relative Market Share to Porsche
Customer Satisfaction
Customer Retention
Internal: Irrelevant
Evaluation will happen quarterly to ensure we can keep monitoring progress to ensure goal
achievement. It is essential Alfa Romeo hold them accountable to ensure their market share
goals are achieved. With the events that Alfa Romeo will be holding, the company is able to see
the increase in brand recognition through the public. Ultimately these metrics will help Alfa
Romeo key in on niche market of Experiential Purists that we are trying to target.

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