Monthly Archives: April 2015

The Slowest Selling Cars

File

Last month we wrote about the top cars as ranked by independent testing organization, Consumer Reports. Among the company’s top picks based on road tests, crash tests, and reliability were Tesla Model S, Subaru Impreza, Chevrolet Impala, Toyota Highlander, and Honda Odyssey. This month, let’s look at the cars that it appears no one (or at least very few) want to buy.

According to data from Kelley Blue Book, the average amount of time a car is on a dealer’s lot is 71 days, with some models selling in fewer than 15 days and other waiting 120+ days to sell. Which cars sold the slowest in 2014?

  1. Honda Insight, 170.7 days, units sold 3,965 ($18,725)
  2. Nissan GT-R, 169.9 days, units sold 1,436 ($101,770)
  3. Cadillac ELR, 158.6 days, units sold 1,310 ($75,000)
  4. Infiniti Q60, 158.3 days, units sold 7,740 ($40,950)
  5. Buick Verano, 144.7 days , units sold 43,743 ($23,380)
  6. Cadillac XTS, 144.6 days, units sold 24,335 ($44,660)
  7. FIAT 500L, 140.1 days, units sold 12,413 ($19,195)
  8. Volvo XC90, 139.5 days, units sold 3,952 ($48,900)
  9. Kia Cadenza, 138.8 days, units sold 9,267 ($35,100)
  10. Cadillac ATS, 138.1, units sold 29,890 ($33,215)

High turnover does not necessarily mean that a car is absolutely popular or unpopular, but instead implies that it was popular or unpopular relative to the expectations of the manufacturer. For example, while there were more than 43,000 Buick Veranos sold last year, Buick probably anticipated higher demand, thus overstocking which resulted in an average of 144 days to turn the car.

Group Activities and Discussion Questions:

  1. Discuss the issues associated with sales forecasting and manufacturing.
  2. Before showing the video or discussing the slowest selling cars, poll students about the reasons why cars might sell slower than average.
  3. Show video: http://www.usatoday.com/story/money/cars/2015/04/11/cars-americans-dont-buy/25602781/
  4. Divide students into teams. Assign each team one of the cars to research. Have them find out prices, number sold, locations for best sales, competitors, etc.
  5. Next, have students develop recommendations to lower the average days it takes to sell a model.

 

Source: Kelley Blue Book, USA Today, Manufacturing Business Technology

 

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Car Insurance Shopping via Google

Car

The wait is finally over – Google announced its intension to sell auto insurance online in the U.S. (Google has already been selling online auto insurance for more than two years in Britain.) Google’s new Web site, a search engine for insurance quotes, is the newest entry into the field of comparison shopping sites that sell products and services using side-by-side comparisons.

According to Google, the new service will start in California and then later roll-out to additional states. As the traffic builds, the company will also introduce ratings, reviews, and local agent support for insurance providers with agent networks. When a customer buys using Google’s site, Google will collect a referral fee from the insurer.

Google has acquired state licenses (needed to sell insurance) in a large number of states, and has formed partnerships with other online insurance agencies such as CoverHound. Insurance sold online allow customers to buy directly from insurers, cutting out the fees paid to agents.

Group Activities and Discussion Questions:

  1. Discuss the differences of marketing products versus services. Discuss key aspects necessary for success when marketing services (the 4 Is).
  2. Bring up Google’s insurance Web site: https://www.google.com/compare/autoinsurance/form?p=home
  3. Also show a similar service from CoverHound: http://coverhound.com/
  4. Divide students into teams. Have each team develop an environmental scan for the new service: social trends, technological forces, regulatory and laws, competitive analysis, and economic forces.
  5. Discuss how insurance agents can adapt to the new online sales model.

Source: New York Times, Google, other news sources

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Big Mac Décor for the Home

Dog

Branding is an incredibly valuable part of a company’s portfolio. Companies strive to get logos and products placed in unexpected places. While we are now used to seeing brands promoted in movies and television shows, companies have to do more surprising placements to get our attention. Enter McDonald’s “lifestyle collection” of Big Mac- themed items available for purchase online.

Big Mac is the most popular hamburger in Sweden, and McDonald’s sponsors the Swedish Alpine and Cross Country Ski Team. As part of the sponsorship, thermal underwear carrying Big Mac icons was produced for the team members. Now, the collection has been expanded to include such items as Big Mac wallpaper, Big Mac sheets, Big Mac raincoat, Big Mac Wellington boots, and a Big Mac dog coat.

No word yet on what seeing the Big Mac picture everywhere does to one’s appetite for burgers.

Group Activities and Discussion Questions:

  1. Discuss product placement and branding.
  2. Divide students into teams. Have each team list the product placements they can remember.
  3. Show the Big Mac Shop Web site:

http://bigmacshop.se/

  1. Divide students into teams and assign each team an iconic brand. Have the team develop a series of products using the brand, logo, or product image.
  2. Have each team present its product set, and then have the class vote on which products best represent the brand and have the opportunity to increase awareness or sales.

Source: Ad Age Daily

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