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The New Beetle Harvard Case Study Solution

Decent Essays

“The New Beetle” (HBS) Case Study Analysis
This case study discusses the history of Volkswagen (VW) in America and in particular the launch and relaunch of one of the most successful VW models, the Beetle. 1. Why would positioning the New Beetle be considered Mission Impossible? Volkswagen (VW) started their business in the US in 1949 with the very successful Type 1 or as it was know, Beetle. In the 80’s, due to several reasons from legislation to Japanese competition, VW had to stop its production. In 1994, began the idea of re-launching the once brand’s icon. But this time, the New Beetle was envisioned at first as “the bug of the new millennium”, aligning the tradition and nostalgia of the past with the new technological advances and …show more content…

Having identified this ambiguity, how would the marketing team position the New Beetle? Would it be as a revival of the Old Beetle, focusing on heritage and emotions it brought but bringing the concern of the perceived image of ‘toy car’ due to its past reputation as people’s car or would it be positioned as a real, drivable car focusing on drivability, uniqueness and in line with the strategy of approach, invitation and drive 4 experience . Moreover, should they include it in the “Drivers Wanted” campaign? Some defended that New Beetle was aligned with the campaign’s value proposition, others were of the opinion it should be positioned on a different campaign, leveraging on tradition and past it had with the Old Beetle. There was also the issue of the possible cannibalization of Passat, which was released a few months before. Concerning price, it was set at $15,200 in the small-size category, which ranged between $11,000 and $18,000, putting it at the high-end. This was an issue because it would bring a broader competitive set (customers could consider the upper categories, where was Golf), and was inconsistent with the image of affordability. Also, setting a price too low would send the message of low quality and also lead to dealer concern due to small profit margins and eventually, some defection. Finally, there was also a decision to be made about media. With only 25% of

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