How a heritage car brand analyzed its supply and demand mechanism to win back its position and improve its market ranking?

A much sought-after heritage car brand had been seeing low sales with its ranking and reliability rating dipping with every passing year. The company authorities felt the pressure to bounce back with a clear strategy regarding the current and future market trends. They reached out to Research Nester consultants to devise a comprehensive and structured plan of action to incorporate a distinct supply and demand analysis approach for growth and profitability.

An overview:

The car brand was highly popular in the 70s and 80s, being known for quick and nimble city cars.

However, with the invasion of new automobiles, advancements in technology, and changing tastes and preferences of consumers, the sales and market position of the brand started to go downhill.

In 2015, there was an immediate recall of a particular model of the car brand owing to its faulty power steering.

After that, the company stuck to its guns, without much acceptance of the changing market trends, and positioned itself in the heritage category.

The stagnating resources, declining sales, and subpar reliability ratings finally became instrumental in making the company stakeholders rethink their strategy to push the brand toward prosperous growth.

Research Nester services were deployed to enter the realm of the company’s infrastructure and accordingly strategize the supply and demand

The Story

The car company had been in the business for close to a century. It had once upon a time recorded considerable sales and was also the most widely bought small car in the mid-70s and early ’80s. The ease to drive, affordability, and reliability were the factors that worked for its popularity. But as new automakers entered the market with high-end innovations and technological advancements, the sales of the company saw a decline. With the turn of the century, the company tried to keep pace with the evolving market trends. However, in 2015, the power steering of a particular model of the car company was found to have some critical issues. The wiring beneath the steering column was found faulty and increased the risk of accidents. Monitoring the scenario, there was an immediate recall of all the cars of the model before the year. The company gradually lost its growth momentum and was taken as a heritage car. The market position slowly was ignored considering the limited functionality with dwindling sales and a falling reputation. The company authorities sought the services of RNPL to work out a strategy for facilitating a proper demand-supply analysis to promote car sales and eventually a strong market position.

The Solution:

The major issue with the company’s reduced market value was its unsophisticated technology and low product functionality. The automotive industry being highly competitive and dynamic, the brand needed to keep pace with the evolving mobility trends, changing consumer preferences, and rapid technological advancements. As observed by Research Nester analysts, the strength of the brand was the sturdy build of its cars, although the component quality could do with some improvement in efficiency. Keeping the present situation, the company needed to focus on the current and emerging trends and accordingly re-strategize its business processes. Apart from that, the brand also needed to concentrate on its targeted population, the average middle class, and upper middle class. RNPL consultants suggested the following strategies to balance supply and demand equilibrium-

Evaluating manufacturing capabilities and capacity to meet the market demand according to available resources.
Focusing on supply chain management while also analyzing the efficiency and resilience of its logistic processes.
In-depth research on market trends and mobility preferences of consumers.
Investing in research and development and implementing advanced technology and features in its cars.
Analyzing the competitive landscape with respect to their product offerings, marketing techniques, pricing strategies, and customer satisfaction levels.
Adopting automotive innovations such as electrification, connectivity, and autonomous driving.
Identifying emerging mobility concepts such as ride-sharing, car-sharing, mobility-as-a-service, etc.

The brand incorporated the above suggestions and accordingly remodeled its product development strategy. It started to focus on providing sustainable mobility in its cars. It renewed its product portfolio which included the introduction of an EV model. The marketing strategy was developed to focus on the legacy of sturdy cars along with technologically advanced and reliable components. The company’s pricing strategies, discounts, and incentives stimulated a growing demand for its cars. The sales started looking upward as the company climbed the market ratings.

Results

The growth had been significantly halted since the recall of the particular model of the car company. The sales in 2014 were 4.8 million units. In 2015, the year of recall, the total number of units of cars sold was 12000. This figure improved a bit for a short period in 2016-17, but gradually went down further in the coming years. In 2019, the sales recorded were just 7800 units. This is when the company authorities decided to go for professional help. Research Nester was brought into the realm to analyze the current situation and devise a strategy to facilitate prosperous and sustainable growth. With the incorporation of the expert advice offered by RNPL analysts, the company optimized its supply and demand patterns which paved the way to successful growth. The sales finally touched 7.5 million units in 2022 and have since then never seen a drop in the growth percentage.

How a heritage car brand analyzed its supply and demand mechanism to win back its position and improve its market ranking?

An overview:

The Story

The Solution:

Results

Contact Us

Vishnu Nair

Let Us Hear About Your Requirements:

Subscribe to Our Newsletters