Ravi Ranjan Kumar

Reg. No. – 1521026

VOLKSWAGEN INDIA CASE STUDY ANALYSIS
1. Conduct a critical analysis of Volkswagen India’s digital strategy
Ans: - India is a very important market for various automobile manufacturers whether Indian or
foreign. According to a study by Booz & Company, the Indian Automobile industry will
overtake the European market and is slated to become the world’s fourth largest by 2015 and will
be selling almost 6 million units annually by 2020. This speaks of the interest shown by
International brands in the Indian market as they are struggling in mature markets to sell their
automobiles. Here, I am going to take up the case of Volkswagen India regarding their social
media practice, what they are doing right or wrong.

FACEBOOK
Volkswagen has grown its facebook fan page organically to a community nearing the count of
25,000. As far as wall communication is concerned, they are engaging with their fans in a
responsible manner by replying to their queries, appreciating the feedback, running the contests
etc.Volkswagen fan page has 25000 members and their engagement is significantly high whether
announcing the new release of its models, replying to the queries, running contests and
appreciating feedbacks. The Facebook page has over 29 lakh likes and same number of people
follow it .the key disadvantage of the Facebook page of Volkswagen India is that there is very
less participation from the company when there is negative feedback from the customers. The
company does not take effort to clarify or rectify the problems faced by the customers.
TWITTER
Volkswagen's Twitter presence is not that great as when contrasted with its Facebook page yet
they are doing estimable employment over yonder by being very intuitive with their supporters
and retweeting the positive tweets. They likewise attempt to take care of the issues confronted by
their supporters identified with the vehicles claimed by them, which is a decent practice.
Another great practice i saw is that they have recognized the proprietors of Volkswagen vehicles
on twitter and have added them to the separate arrangements of various vehicles. They utilize
these rundowns to monitor their clients and sporadically educate them about any new activities
or offers. The key issue with the twitter record of Volkswagen would be less devotees contrasted
with the Facebook and they don't most loved any positive tweets which can be utilized as tributes
which can be utilized to draw in clients.

YOUTUBE
As far as YouTube channel is concerned the company uses its YouTube channel to post new
videos of the product launches, new advertisements and the channel has a substantial number of
views and likes but they have very less subscribed viewers. The company must provide
incentives to the viewers in order to increase the subscribed users.
They should take a cue from YouTube channel of Volkswagen International who have total
views of more than 57 million till date! They should cross promote the videos of their dedicated
channel on other online platforms and should provide some incentives for people to subscribe to
their channel.

LINKEDIN

Volkswagen India has optimally utilized its LinkedIn page. Since company pages is a new
feature from LinkedIn, very few companies have actually have taken advantage of it &
Volkswagen is one of those. They have listed 7 of their vehicles on LinkedIn so far they have got
2772 recommendations till the time.

SPECIAL CAMPAIGNS
Volkswagen also started two campaigns at different times in India. ‘Innovations for
Everyone’ was launched in 2010 while another campaign ‘Think Blue’ was launched recently in
2011. Both these campaigns were launched with much fanfare as an integrated marketing
campaign across all the online & offline channels which created a lot of buzz for them.People
submit their ideas on the dedicated sites of these campaigns & they get voted for their innovation
by other participants and the person with highest number of votes is declared the winner. Some
of these ideas are passed on to the product team to study their feasibility of being introduced
among the upcoming vehicles.
1. Conduct an environmental, competitive and situation analysis for
Volkswagen in the current market scenario. Please conduct thorough
research and include references for this question.

Ans: - India is world’s seventh largest passenger market and is growing at a faster rate and was
said to overcome Germany, Brazil and Russia in 2015 despite Germany, Brazil and Russia
undergoing recession and geopolitical tensions in these countries India’s bid to enter the top-
four-passenger-vehicle-markets bracket in the next couple of years looked weak due to lower
than expected economic growth and modest gains in the country’s automotive industry. The
automotive industry has seen a drop of 6% in the passenger vehicle volumes in the year 2014, the
country has seen a gradual increase in the volume of passenger cars sold in the year 2015 mainly
due to the macro economic factors such as stable government at the centre, increased focus on
the policies on investments from foreign companies in India. The government policies such as
reduction of excise duty from 12% to 8% on small cars ,24% from 30% on sports utility vehicles,
24% from 27% on large cars and 20% from 24% on mid-sized cars .The penetration of vehicles
in India is still low at 18 per 1000 individuals.

The key players in the market are Maruti Suzuki which is the market leader in the Indian market
which started its production in 1984 and has wide variety of cars in different segments in the
market ranging from low cost small cars to sports utility vehicles. It is followed by Hyundai
which entered Indian markets in 1994, followed by Honda, Volkswagen, Fiat, Ford, Mahindra
and Tata which cater to the India customers with cars which are in the range of 5 to 10
Lakhs .the luxury car segment is dominated by Audi, BMW, Lamborghini which cater to the
high end customers.

Volkswagen entered the Indian market in 2010 alongside the auxiliaries, for example, Skoda can
acquire just 4% of the piece of the overall industry. The organization in the current past has seen
fall in deals up to 20 %. In India, neighbourhood producer Maruti Suzuki and outside automakers
Hyundai and Honda control more than 70% of the traveller vehicle volumes. The mastery by
modest bunch automakers is for the most part because of the extensive prevalence of section
level compacts, which oblige first-time purchasers.
Almost one in two new cars sold is an entry-level compact, boosted by government incentives
such as lower excise taxes for smaller cars and price-sensitivity of the lesser affluent customers.
Volkswagen has positioned itself as a relatively premium brand, and thus doesn’t compete in this
high growth segment. Moreover, Volkswagen’s sedan offerings such as Skoda Octavia and
Superb and Volkswagen Vento haven’t been able to compete strongly with models such as
Maruti Swift Dzire and Honda Amaze. With high growth for entry-level compact cars, and
strong brand recognition of Maruti, Hyundai and Honda, which have vast dealership networks
across India.

Volkswagen has significantly lowered to market share to 7-8% by 2018 from previously
estimated 20% in 2010 when they entered the market from the current market share of 4 % by
accelerating its penetration in the country as part of the strategy they plan to launch a new
product every year which started by launching a face lifted model of its Vento model. It has tried
to protect its relatively premium brand image by entering high growth end segments such as
SUVs and compact sedans as the sales of compact sedans have rose by 55% as bulk of the
customers how customers are looking to trade-in their smaller cars for larger sedans and
Crossovers such as Ford Eco sport, Hyundai Creta due to increase in wealth and economic
conditions of the middle class population

Volkswagen in order to improve competitiveness has decided to invest around $250 million
throughout the decade to increase local content sourcing and production to introduce new models
according to the taste of Indian customers by increasing local source contents in its model from
65% to 90%. Volkswagen aims to expand its production base in India, starting with building
engines and gearboxes in the country itself.

Competitive Advantage towards Volkswagen Competitors.

 Expansion of Product Portfolio
 Service Options
 Expansion of Dealer Network
 Customer Connection
Volkswagen strategy for 2018
  Volkswagen intends to deploy intelligent innovations and technologies to become a
world leader in customer satisfaction and quality.
 The goal is to increase unit sales to more than 10 million vehicles a year.
 Volkswagen aims to be the most attractive employer in the automotive industry by 2018.
3. Was the initial Volkswagen social media campaign successful? Why?
Ans: - No the initial Volkswagen social media campaign was not successful as mentioned
earlier Volkswagen had employed a 5 point strategy of promoting the products mainly through
Facebook, Twitter, LinkedIn, YouTube and special campaigns which are mainly focused on
customer interactions and introducing new products .It was a portal for the customers to ask
queries and give feedback to the customers. The campaign has not yielded significant dividends
for company as it struggles to keep a dismal 4% market share in the Indian market .When
Volkswagen had started its operations in India it had predicted a market share of 20% by 2018
due less response from the customers the company had to reduce its growth forecast from 20% to
8% in the year 2018.

The objectives Volkswagen media campaign was Ace the Race campaign is to take the
Volkswagen brand deeper into the public consciousness making the brand image even stronger.
And to do that, the brand has decided to test the creative potential of people by challenging them
to engage the brand with their SLR cameras and click some stunning pictures.

Volkswagen has primarily used Facebook as a social media channel to generate a buzz around
the contest, which, ashinted above, involves clicking photographs of VW cars, its showrooms,
the logo, vintage cars, or anything involving the brand (see the image below), and share it online
after clicking on the participate button on the contest tab on the brand’s Facebook page.
The contest, which has started on 17th July, is scheduled to end on 9th September, and the
winners will be chosen by Volkswagen India, with the top 5 of receiving an opportunity each to
cover the Polo R Cup live in New Delhi, and create a portfolio of 20 images to submit to the
jury. The jury will then choose a winner for the grand prize. The grand prize winner will get an
all-expense paid trip to cover the Sirocco Cup live in Europe and be featured on the Volkswagen
2014 calendar.
To promote the posts, the brand has used its cover image (see the first image below) along with
frequent (but well-spaced) posts on Facebook and Twitter (see the second and the third images,
respectively), which has created a good-level of buzz among its fans and followers. You can get
an inkling of it in the posts shared below.
Conclusion:- Overall, Volkswagen’s Ace the Race is a nicely executed contest, which has
generated a good amount of buzz. The decibel level of conversation around the contest and the
brand in general is fairly high, which will will help VW in strengthening its brand.
4. In relation to above questions would the same campaign have been
successful in today’s market? Why or Why not?
Ans:- The campaign that Volkswagen focused was on the social media sites such as
Facebook ,Twitter,LinkdIn and YouTube it also had conducted campaigns such as ‘Innovation
for Everyone’ and Think Blue which was started in order to improve the customer interaction
and market penetration of the brand in to the customer.Volkwagen is seen as a premium brand
range and hence was not able to connect with the middle class population in India which
constitute the majority of the population and also less outreach by the company in addressing the
requirements and complaints of the customers .this has led to the company to descale its market
share from 20% to 8% in the year ,so I believe that the current campaigns have not helped the
company to achieve the desired results.
5. Present a short digital and social media strategy for Volkswagen’s product
range - set a clear and precise goal, and explain in detail how you would go
about in creating a successful integrated online and offline marketing strategy
to achieve the same
Ans: - The digital and the social media strategy that the Volkswagen needs to come up would
be aggressive campaign both in online and offline medium which needs to focus on improving
its brand image which is currently seen as a premium brand .The company need to retain its
‘Innovation for Everyone’ and Think Blue which takes feedbacks from the customers in order to
improve the performance of the products from Volkswagen.
The organization need to react to the quires and inputs that they get from the customers, increase
the quantity of administration focuses that is said to be the fundamental issue that the clients the
individuals who brought Volkswagen are confronting as the administration focuses are
accessible in urban communities which make it hard to keep up the autos which they have
brought. The organization needs to dispatch new section of autos which obliges the working
class populace of India where the real piece of market is at the value scope of 5 to 10 lakhs .the
online networking pages of the organization must be more intuitive with the clients with center
in enhancing the clients encounter.