Marketing Citroen Ds in Australia

Citroen DS3 is a small car that is marketed by the French automaker Citroen. The DS3 was originally launched in 2010. It comes in two main variants, the regular DS3 and the Cabrio. The car is in the supermini class, wherein it competes with the likes of the Mini Cooper, the Smart Fortwo and other very small passenger cars. This paper will examine the marketing of the DS3, with particular reference to the Australian context. The marketing will include the 4Ps of price, promotion, place, and product.

The analysis will also determine the target market and market segmentation for this car. The core value proposition and other key marketing elements will be discussed as well. The analysis will be based on the marketing materials provided by the company online, with analysis rooted in marketing theory. Brief Overview The automobile industry uses extensive segmentation of its products. Most companies in the industry operate globally, and typically will offer vehicles in most segments of the market.

The segments are based on the type of vehicle, but each vehicle type will typically appeal to a portion of the overall automobile market. In that sense, the product is designed specifically to appeal to certain consumers. Because of this, the ideal situation for the manufacturer is that the target market's characteristics will not differ much around the world, so that the product can fit the broadest possible segment.

For example, if Citroen sells the DS3 around the world, ideally the target customer in Australia, North America and Europe will have roughly the same characteristics, so that the design of the car remains appealing across countries and continents. In some cases, automakers will not market a given vehicle in a particular country if the market characteristics do not fit the vehicle's design and features. There are some themes in automobile marketing that are relatively universal, and provide the framework for understanding the marketing of a product like the DS3.

The first is that there is only ever a limited amount of customization available on a given vehicle. This is in part why there are so many product segments within the private consumer automobile market. The cost of developing a vehicle is very high, as are the fixed costs associated with automobile manufacturing. Thus, a high degree of product standardization is necessary in order take advantages of economies of scale in production.

Standardization makes for some challenges in meeting consumer needs, but it supports the ability of companies to offer vehicles at prices middle-class consumers can afford. Another generic feature of automobile marketing is that cars are typically sold through dealer networks. There are few exceptions to the rule. Dealers are often franchised, and sell only the vehicles of one company, or a stable of related companies. Citroen being a smaller manufacturer, it may need to share dealers in certain smaller markets, rather than having its down dealers.

The dealers are responsible for the sales of the vehicles, but the manufacturer is ultimately responsible for the other elements of marketing, including the product, setting the base price, all of the promotion and determining what markets in which to sell the vehicle. The manufacturer will therefore need to have a strong sense of the target market, even if the manufacturer is not the final seller of the vehicle. Market Segmentation and Target Market The first point of segmentation in by geography.

Citroen markets the DS3 in a number of different countries, and this report will focus on Australia. Within Australia, the marketing of the DS3 is governed by the location of the dealer network for Citroen. The dealers in a given territory should seek to sell to that entire area. Citroen typically markets nationwide, or at the very least focused on the large cities, which contain most of the Australian population. The second point of segmentation is by demographics. Demographic features include age, race, gender and other such characteristics.

Typically, the category will have an appeal with a certain demographic profile, and then the vehicles within that category will seek to differentiate slightly within that demographic. The supermini category is targeted towards a younger, urban demographic. Buyers are typically in their 20s or 30s. They are educated, live in cities or possibly inner suburbs. The ad copy highlights values that are important to the younger car buyer.

Consider the following copy from the DS3 web page: "DS 3 gives you impressive freedom of expression through elegant design, advanced technology and a huge range of personalised options. Each DS 3 is unique and you can design yours to suit your individual style." Key words in this text include 'freedom of expression' and 'individual style.' A massive produced vehicle is can never really be an expression of individualism, but the text conveys these values for a couple of reasons.

This is positioned as a first vehicle, or at least a first new vehicle for the buyer, so it will give the buyer some freedom of mobility that they never had before. The younger buyer views a car as an expression to the world of who they are, just as their clothes, their phone, and other consumption choices do.

The Citroen is a niche vehicle, as the brand is relatively small, so the DS3 offers a unique value proposition to the young buyer as a cool car that their friends maybe do not have. The buyer is also likely to have some post-secondary education, in that he or she is able to buy a new car. This is someone who is starting to establish his or her identity as an adult, and the car is part of that.

The DS3 buyer is therefore starting in the workplace and building a career. This person probably travelled overseas during gap year as well, and has some experience in the world. The small size of the car makes it most appealing to urban dwellers, people who need a car for things like getting to the beach, but who also value fuel efficiency and ease of parking in their urban environment. The third method of segmenting the market is by psychographic. Psychographics help to understand the customer.

The customer is a young, urban Australian with an education, starting a career and earning a salary typical of his or her generation. The car is gender neutral in terms of its positioning. Australians of any race, if they otherwise fit the demographic, are targeted for the DS3. The psychographic characteristics of this demographic are value on independence, on expressing oneself through their choice of vehicle.

The brand is also positioned as a creative alternative, to differentiate itself from an otherwise "vanilla" category, and in that way to appeal to millennials more effectively. Their ads for this vehicle have been likened to Apple in terms of their marketing approach (Kay, 2013). The company is seeking consumers who value creativity and modernity, as evidenced by the endline "Creative Technologie," a call to people who value creativity, and who inhabit a world where creativity is a key value.

The focus on technology -- their ads feature ample visuals of the product -- is also a call to the millennial generation, consumers who were raised with technology and for whom technology is a critical element in their world. Citroen's approach is aligned with the values of its demographic, in particular the educated, urban millennial.

This consumer is also worldly, and this high degree of worldliness and interconnectivity means that consumers in this market are relatively the same in terms of their demographic and psychographic composition around the world -- and indeed these are people who travel and live around the world. This fits with the distinctiveness for which the Citroen brand has historically been known (Meiners, 2014). Product The DS brand is a supermini, which appeals to younger, urban consumers as a first new vehicle, something that gives them greater independence and freedom.

Style is a key feature of the vehicle. Citroen has historically had a quirky sense of style (Meiners, 2014), and the DS represents a return to that after years of mimicking German and Japanese style innovations (Key, 2013). The DS is small, which allows it to come in at a price point to appeal to this market, but the styling attracts specifically an urban, younger consumer. This consumer does not have children (yet), so a small car is appropriate.

The styling is unique, which should appeal to the creative, technology-obsessed segment of the broader demographic. The product has won praise for its ability to meet the needs of this market, through its emphasis on styling. Where style is important, reliability is less important. This is not a car that is going to be driven for long distances daily, and a market that prefers style is not concerned with how the car's reliability will hold up in the long run.

As a new brand, there is limited data available about its reliability anyway, and this is not a key message in the advertising. To further appeal to this market, the car has a higher level of customisation than many others in its class. This emphasises the individuality dimension of the marketing by offering superior customisation. The customisation is interesting from a product perspective, because it means that the customer is not likely to drive away with a car once the purchase decision is made.

This raises some interesting challenges on the manufacturing side. Typically, an auto will be produced with a range of popular options, but that is only viable when the dealers are obligated to hold a large inventory, and when there are only a handful of options. The more options with regards to customisation, the more complicated the manufacturing process will be. Citroen does not have a factory in Australia, but rather its closest are in China.

Some DS models are produced in Shenzhen but the remainder would be sent from France, which could have a substantial lead time for an Australian consumer, remedied only by dealers carrying substantial inventory. Nevertheless, whatever logistical challenges there are on the back end, this is one of the major selling points for the product. Placement Ads are targeted at younger consumers, and seek to meet those consumers where they are -- in cities and online. The vehicles themselves are sold through Citroen's network of dealers.

In Australia, Citroen has its own dealers, and these are located throughout the country, even in some of the smaller cities (Coffs Harbour, Townsville, etc.), which allows the company to target quite broadly for its products. The company has produced a brochure that can be ordered online to provide more information. The marketing has also been done through some more traditional channels.

The objective is to raise awareness about the product, to spur interest and also to convey a few key aspects about the message, in particular to ensure that the target market has an opportunity to see the car's styling, which the company feels is a critical feature. The focal point for the DS marketing is on urban areas, no doubt because this is where most Australians live anyway, but also because the major media markets are where the target market for this vehicle live.

Price Price is another key element of the four Ps of marketing (MindTools, 2015). The price for the DS vehicles is dependent on the customisation elements that the customer chooses. The lowest starting price for the DS3 is $30,990 RRP (recommended retail price) and the full driveaway price for a relatively loaded is $40,768 in Sydney. This price point is in line with the target market. The consumer is young, so the price cannot be too high, but the customisation allows the customer to set his or her price.

The target market is generally willing to pay more for style, and also is educated and has started a career. Thus, pricing in the $30-40,000 range is not too steep for a young, urban Australian with a stable income. The pricing makes the vehicle attractive, and is roughly in line with competing vehicles, many of which also emphasize some element of style. The high degree of customisation is responsible for the high degree of swing in the price between the base price and the highest possible price.

Most consumers are expected to avail themselves of at least some of the options, which should put the average price in around the mid-30s. The different features should have a reasonable margin, as they will be purchased after the final purchase decision on the car has been made, and thus the buyer should have a lower degree of price sensitivity with respect to these optional items.

From the perspective of Citroen, this tactic should be effective because the price can end up 33% higher, with that third coming in a higher mark-up form. Promotion The emphasis on style, visuals and urban themes is evidence in the marketing for the DS brand. Modernity is another key theme, along with creativity. The promotional material illustrates the sense that the target market places significant value on these aspects, and can be grabbed by superior visuals.

The visual sense is intended to pique interest in the product, leading the prospective buyer to investigate further. The copy details are focused on the DS, and seldom if ever mention the competition. This approach highlights that Citroen wants the car to sell itself, and perhaps sees the consumer as less interested in shopping around.

The consumer may well do comparisons, but as first-time buyers they are more concerned with having a new car than they are about doing the sort of intensive comparisons that older, more experienced car buyers might do. The promotional themes are attuned specifically to the psychographic elements of the target market. In particular, the marketing is worldly in the sense that often the themes are not Australia-specific at all.

This is again a classic Citroen approach, to be a little bit iconoclastic in terms of how they are selling the car, and seeking a slightly different market from their competitors. Part of that is the nature of the category, which is inherently urban and young-skewing. Value Proposition The core value proposition is an important element in marketing. By communicating the value proposition to the customer, the company conveys what the product will deliver in terms of benefits. For the customer, the value proposition is about utility.

The vehicle costs a certain amount, and it needs to justify that cost with utility. So for the DS3, the utility has to be sufficient to justify the purchase of that vehicle over the purchase of any other vehicle, new or used. There are a lot of alternatives in the world, so the value proposition needs to be fairly compelling. The value proposition for the DS3 aligns with the themes of creativity, independence and freedom that are conveyed in the marketing promotions.

The creativity aspect is part of the brand identity for Citroen, one that is explicitly expressed in the endline of "creative technologie." The company's quirky design sense is one of the aspects that sets it apart from the competition, and they play this aspect up in their marketing. The DS3 is specifically marketed to a target audience that sees a vehicle, as with other consumables, as an outward expression of self; to this audience, the choice of vehicle says something about them.

The DS3 therefore has the unique styling that appeals to this target market. The ability to convey to one's friends and family that they think outside the box and have a high level of individuality is one of the core values that the DS3, through the product dimension of the marketing mix, conveys. The other aspects of individuality and freedom are also core values that the DS3 delivers. Again, these are product attributes, but the focal point of the marketing.

On one hand, there is nothing unique about the DS3 with respect to delivering an enhanced level of freedom to its market -- any car can do that. What is unique is that the DS3 is specifically positioned for young people, as their first new car.

As someone's first new car, it might also be a first vehicle, but there is a greater sense of freedom that is conveyed -- the freedom core value is meaningful to this customer in a way that it might not be for most car buyers. The core value of independence is something that is conveyed by both the attributes that support the other values. Independence can mean the freedom aspect -- a car gives.