Brand situation analysis

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Volvo Brand 4

Brand Situation Analysis — Volvo

Volvo Brand

Volvo is a multinational company that manufactures and distributes vehicles. Its headquarters are based in Gothenburg, Sweden. It was founded in April 1927 by Gustaf and Gabrielsson (Shirani, 2012). Volvo owes its strengths in the fact that it produces vehicles which are very secure but their brands are perceived by many as boring and unfashionable hence its weakness. It has external opportunities in relating well with China, hence can expand their business. Opportunities can be gotten from more financing from the Swedish government. Its threats come from competition from the many famous car brands like Toyota, Nissan, Mercedes and BMW. Mooney (2007) argues that this makes the demand for Volvo cars to be affected negatively therefore reducing the sales and the brand is therefore suffering a problem. Sometimes back, Volvo was regarded as the manufactures of the safest but most boring vehicles. Parents and guardians preferred Volvo for their inexperienced teenaged drivers to protect them. Shirani (2012) found that today, the company manufactures vehicles that are mid-range and poorly built. This is done with the motive of competing with vehicles such as BMW and Audi. In the meantime, Volvo is not viable and in 2010, it was offloaded to Chinese Geely motors for US $ 1.8 billion. Volvo’s current CEO, Stephene Odell, argues that there can be retrenchment of employees in the near future (Kelly & Jugenheimer, 2015). There is a high possibility of the Volvo to be bankrupt.

Current Campaign & Key Insight

The car manufactures are trying their best to save the current threat in the company. The CEO have had talks with the Swedish government with the aim of coming up with measures to save the situation. It is clear that there is a need for long term and well managed financing and credit opportunities (Kelly & Jugenheimer, 2015). This applies to both customers and the dealers of Volvo. Mooney (2007) says that, if the company is handled in the correct manner, there are chances of Volvo to become a major car seller in China, but if the situation is not correctly handled, it could fail to exist in five years. The current competition from more expensive cars such as BMWs and Audi gives Volvo a challenge. The manufacture of BMW for example, have become very rich and enjoy economies of scale due to selling their vehicles at a high price. Volvos safety features have began to have less appeal to customers making their current campaign not to bear fruits. The fact that Volvo has failed to peak during China’s boom, its chance during bust is more or less predictable. The future is uncertain.

Research methods to use

I would use surveys to assess the consumers of the brand and get the opinion on the brand and to know where to improve. These will involve using straightforward questionnaires to a sample group that will represent the whole target market (Kelly & Jugenheimer, 2015). It should happen in areas with many people so as to get a clear view of what most customers prefer. Focus groups can also be used in order to target the areas of weaknesses as well as the strengths of the company according to consumers. It should take place in neutral places to get balanced results. Such methods will help Volvo in identifying their areas of weakness in order to improve and meet the consumers’ expectations. Basically, if their weakness is identified, they will make what will please consumers thereby increasing their sales and making the company profitable (Mooney, 2007).

References

Kelley, L. D. & Jugenheimer, D. W. (2015). Advertising Account Planning: Planning and

Managing An Imc Campaign (3rd Ed.). New York. Routledge.

Mooney, A. (2007). Core competence, distinctive competence, and competitive advantage: What

is the difference? Journal of Education for Business, 83(2): 110-115.

Shirani, M. (2012). The Distribution Network of Volvo Cars Customer Service (VCCS).

Germany, Grin Verlag.