A bit about me first…
Being a 2002 Subaru Forester who loves marketing is tough if you ask me…. and you can, because I am one.
Many people think my views will be biased (they’re not) and being a car rarely allows me attend marketing conventions. However, I’ve travelled the roads for a while now and have plenty of insights to share.
Why are Segmenting, Targeting and Positioning important?
For people to buy your cars and have experiences that they want to share and repeat in the future, manufacturers must understand their purpose and what their objectives are. They also need to recognise what customers want and how to satisfy them. Segmenting, targeting and positioning (STP) are key steps in connecting customers with products, so let’s discuss them in the Subaru context.
Segmenting the market for Subaru drivers
I’d love everyone to drive Subarus but that’s unrealistic, so segmentation is used to determine the most attractive customer sets. Segmentation involves breaking customers into groups who may differ in their response to the marketing mix or 4P’s (price, promotion, product and price) (Iacobucci, 2014). The most basic segmentation methods include by age, gender, geographic location, family life stage and income.
However, relying solely on these forms of segmentation would keep my interior light on at night. It’s risky to assume that people of the same age, family life stage or geographical location will share the same preferences. I mean, you won’t sell many outdoor swimming pools in Tasmania (unless you include bonus full-length wetsuits) but that’s an extreme example.
Effective segmentation strategies also account for psychological factors, including the wants and needs of customers, environmental and economic views, preferences for safety or for new technology. The availability of deep customer data sets also allows for mindset segmentation, enabling marketers to factor in human insights and modern digital behaviours of customers, meaning firms can now segment markets with more sophistication than ever before.
Companies must also ensure that their marketing strategy fits with their corporate strategy and is both achievable and profitable. Subaru’s mission is clear: to achieve prominence by providing customers “Enjoyment and Peace of Mind” and focussing on key products and markets to steadily grow its sales and customer base.
Targeting the “Do-ers”
Subaru primarily focuses on younger singles or couples in urban areas. They have children or may be planning to have them soon and they tend to value safety, freedom and frugality. They want reliable cars to get out and about with their dogs, their kids or both. Subaru labels them “Do-ers” and offers vehicles like the Forrester for young families or the Levorg for the young singles seeking more street performance.
Take a look at the video below featuring the “Do’ers” doing outdoor things and loving life, while paying tribute to Subaru’s heritage and focus on quality.
Warning: this video contains dogs, kids and fun times, so if you’re allergic to any of these things, please skip the video and keep reading.
Positioning Subaru in the race for customers
An effective position statement frames the firm’s target customers, competitors and why the brand is better (Iacobucci, 2014) and here’s Subaru’s position statement:
Subaru has positively and succinctly referenced its cars and its customer’s wants and values. It’s underpinned by Subaru’s promotion of innovation, performance, safety, technology and outstanding value but there’s no direct mention of competitors and that may be to retain focus on Subaru.
As the perceptual map below illustrates, Subaru’s market position differs by model type and accounting for its sales growth over the past 25 years, customers are responding well to the strategy.
Steady growth, but what else is Subaru “Do-ing” well?
Research from Roy Morgan in 2015 indicated that 96% of drivers are satisfied with their Subaru and in 2010, Subaru had the highest vehicle brand loyalty rate amongst Australian motorists at 63.1%.
Source: Roy Morgan Research
Therefore, Subaru drivers are likely to keep buying Subaru’s but a focus on steadily growing the customer base must remain.
What could Subaru “Do” better?
I see many people driving other cars. Motorists without dogs and kids or even older drivers might think Subarus aren’t for them, so have Subaru drivers been stereotyped? The world’s ageing population provides real opportunities in markets where the number of 65-84 year-olds will increase significantly by 2042, making this an attractive customer segment with healthy incomes and plans for adventure if their kids (and dogs) leave home.
Subaru also faces strong competition from established manufacturers and rising stars such as Kia, who offer a market-leading 7 year warranty and Mitsubishi who, like Subaru, are marketing to fun-loving parents.
A closing statement before I run out of petrol: if Subaru is to remain well-placed towards achieving its growth objectives, it must keep rethinking it’s product development and marketing strategies to attract and satisfy customers who will keep buying cars like me.
I’ll leave you to look at a photo some “Do-ers” with sparklers on a beach while you think about that.
- Iacobucci, D. (2014) Marketing Management (MM), 4th Edition, South-Western, Cenage Learning, Mason.
Author: Matthew Smith – 210631019