Porsche Cayenne Case Study Essay

1669 WordsFeb 19, 20137 Pages
Porsche: The Cayenne Launch – During the more then 60 years that Porsche has been producing automobiles they have implemented a variety of design changes and launched many new models -- some drastic, others small. These changes have all been based on the brand’s firm ideals of high performance, fine craftsmanship and a high level of engineering, With the launch of the Cayenne SUV, Porsche experienced an immense challenge in connecting its brand image and identity with the new offering, while maintaining brand legacy. As with any well-established brand there was an entrenched community of customers who participated in ongoing conversations about Porsche and the brand’s meaning. These online communities of loyal customers, such as…show more content…
Observing the market showed that competitors such as BMW and Mercedes-Benz were already leveraging their luxury brand identities across a broad variety of categories and Porsche wanted to do this as well. Porsche estimated that they would only need to sell 10,000 units priced at between $100,000 -$120,000 each and by building 20,000 SUV’s each year they could increase their overall profits by as much as 50%. Porsche was willing to make the large financial commitment necessary to develop the Cayenne because they were confident in their strategy that an SUV which corresponded with the brand’s high technical and visual standards would allow for large potential growth in sales, turnover and earnings areas. Research and development for the Cayenne would cost over $400 million, and a partnership with Volkswagen who would be responsible for the plant and majority of production, helped to weight the inherent financial risk involved. Although the SUV market was highly saturated, Porsche was not worried about the Cayenne being redundant as it would be obviously distinguished from its competitors – while other manufacturer’s were producing vehicles focused on practicality that could go off road but also carry groceries, the Cayenne would be a fun car, going faster, handling better and being more comfortable then its competitors. The company set out to offer an SUV that would be fun

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