Tag Archives: automobiles

2019 NCAA Championship Games Bring in Revenue

Ah, there is nothing like spring. The days get longer, the weather warmer, and the hoops get a workout!

March is madness indeed when the NCAA basketball tournament games get underway. Instead of working (or studying) fans stealthily watch games at work, home, on TVs, computers, and phones. Brackets get filled out, hopes rise; and then inevitably, hearts get broken. While not the largest total viewership of any sporting event, nonetheless the Men’s NCAA championship game draws a large audience – and with it, a lot of advertisement and promotion. This year’s championship game between Texas Tech and University of Virginia drew 19.6 million viewers (according to Nielsen), a 23% increase from last year’s game.

As far as advertising revenue, the tournament brought in an estimated $933 million to CBS and Turner (according to iSpot.tv). Of that total, $114 million (12%) was spent on ads during the championship game alone. Cost for 30 seconds of air time range around $1.4 million. Who were the biggest spenders?

  • AT&T Wireless – $68.0 million
  • Buick – $42.5 million
  • Geico – $36.4 million
  • Capital One – $31.6 million
  • Progressive – $27.9 million

These numbers are just for TV commercials. Now add in additional revenue for sponsorships, signage, events, and more!

How did your bracket do?

Group Activities and Discussion Questions:

  1. Discuss the importance of clearly defining a target market.
  2. Poll students: Who watched the NCAA men’s basketball games? How much did they watch? On what devices?
  3. What ads can they recall seeing?
  4. Show a highlight video of the final game: https://youtu.be/cm3OA8NRib4
  5. For the NCAA games, who is the target market? Is there a secondary target market?
  6. Divide students into teams and have each team develop a profile of a target market for NCAA games. Include demographics, psychographics, behaviors, values, attitudes, etc.
  7. Based on the target market profile, what makes this event unique for these viewers and advertisers?

Source: Jerde, S. (9 April 2010). NCAA championship game averages 19.6 million viewers. Ad Week.

Leave a comment

Filed under Classroom Activities

Tesla Shifts Retail Strategy, Then Shifts Again

Tesla, Tesla, Tesla… It’s so much fun to track this company. Not only are the products innovative and exciting to follow, it is also a marketing case study in nearly constant motion.

Case in point: At the end of February the company announced it would be closing its retail stores in order to cut costs and lower the pricing of the Model 3 to make it more affordable (at a starting price of $35,000). Tesla believes that car buyers will increasingly rely on on-line ordering instead of physical stores. Tesla stated that in North America, a customer can buy a Tesla on their phone in approximately a minute. Which begs the question, just because customers can do this, will they do it?

However, two weeks later, Tesla reversed its strategy and stated it would instead keep most of its 378 retail stores and would instead raise prices of cars by 3%, excluding the Model 3 cars. Tesla hoped to cut costs by closing stores, but landlords, customers, car dealers, and lawmakers protested the closings. The stores will still function as a showroom and location for test-drives, but sales will still be done online.

Where do you want to stop for your next car?

Group Activities and Discussion Questions:

  1. Discuss the distribution model used by Tesla and compare it to the distribution model used by other automotive manufacturers.
  2. Here is an interesting video on why Tesla cars cost so much: https://www.wsj.com/video/the-secret-to-why-a-tesla-costs-so-much-hint-batteries/65F3A21D-0837-4DA6-B739-612124815603.html (Hint – it’s the batteries.)
  3. Poll students: How many would buy a car online instead of at a dealer/store?
  4. What are advantages and disadvantages of buying cars online only?
  5. Why has Tesla disrupted the traditional automotive sales model?
  6. Will other automotive companies follow the Tesla model?

Source: Wall Street Journal, New York Times, Assoc. Press, other news sources

Leave a comment

Filed under Classroom Activities

What Women Want (from Cars)

It’s an age-old question: What do women want? While the answers to this question could fill a set of encyclopedias, let’s limit the question somewhat and just discuss what ‘cars’ women want. Last year, Edmunds.com researched this topic and came up with a list of cars that almost no women drive. Can you guess which car was at the top of the list? It’s a sports car, very pricey, very fast, and starts with “L” ….

Yep, you guessed it. Number one on the list was Lamborghini with male owners accounting for 93% of the buyers (tied with McLaren also at 93%), Ferrari at 92%, Maserati at 84%, and Tesla at 83%. Indeed, 90% of ALL sports car buyers are men. Although men seem to prefer loud, fast, impractical cars, this is a problem for automotive manufacturers as women play a significant role in roughly 85% of all car purchases.

So, what cars do women buy? Overwhelmingly, women prefer cars that are affordable with good fuel economy – and these tend to be mostly from Korean automakers such as Kia and Hyundai, along with Japanese automakers Nissan and Mitsubishi. These findings are based on automotive research company iSeeCars.com which analyzed 54 million car sales and more than 500,000 consumer inquires over a nearly three-year period.

The average price of the top 10 cars preferred by women is $14,870 compared to the average price of cars on the top 10 list preferred by men at $49,224. Let’s compare.

The top five cars women want:

Rank Car Ave. Price Inquiries by Women
1 Hyundai Tucson $16,722 66.2%
2 Nissan Versa $12,144 64.0%
3 VW Beetle $18,179 63.9%
4 Kia Forte $13,730 62.8%
5 Ford Fiesta $13,237 62.8%

 

The top five cars men want:

Rank Car Ave. Price Inquiries by Mean
1 Nissan GT-R *40,450 99.1%
2 BMW Me $35,763 92.2%
3 Porsche Cayman $43,303 91.9%
4 Porsche 911 $65,081 91.5%
5 Lexus GS 350 %33,004 91.3%

 

There are no overlaps on the top ten list. Lest we think this is an inconsequential difference, consider the size of the automotive industry. There isn’t any car company that wouldn’t like to increase the size, and diversity, of its customer base.

Think about it – what do women want?

Group Activities and Discussion Questions:

  1. Ask students about their car preferences.
  2. Divide the class by gender. Ask women what cars they think the men will prefer, and what cars they prefer. Ask men what cars they think the women will prefer, and what cars they prefer. Why these choices.
  3. Ask the women to list the factors they look for when buying a car. Ask the men the same question. Compare the findings on the board.
  4. Still in gender-based teams, have the teams examine the marketing mix of the top companies, and adjust the mix to attract the opposite gender.
  5. Debrief the exercise.

Source:  Ad Week, Edmunds.com, Market Watch, iSeeCars.com

 

Leave a comment

Filed under Classroom Activities