Brand Equity Analysis of AUDI

BRAND EQUITY ANALYSIS OF AUDI 

1. Audi

1.1. Audi AG

Audi AG is a German automobile manufacturer, designs, engineers, manufactures and distributes automobiles. Audi oversees worldwide operations from its headquarters in Ingolstadt, Bavaria, Germany. Audi-branded vehicles are produced in nine production facilities worldwide.

Audi has been a majority owned (99.55%) subsidiary of Volkswagen Group since 1966, following a phased purchase of AUDI AG's predecessor, Auto Union, from Daimler-Benz. Volkswagen relaunched the Audi brand with the 1965 introduction of the Audi F103 series.

The company name is based on the surname of the founder, August Horch. "Horch", meaning "listen", becomes "Audi" when translated into Latin. The four rings of the Audi logo each represent one of four car companies that banded together to create Audi's predecessor company, Auto Union. Audi's slogan is Vorsprung durch Technik, meaning "Advancement through Technology". Recently in the United States, Audi has updated the slogan to "Truth in Engineering". Audi is part of the "German Big 3" luxury automakers, along with BMW and Mercedes-Benz, which are the three best-selling luxury automakers in the world.

1.2. Vision: “Audi – the premium brand”

The Audi Group first unveiled its Strategy 2020 in 2010, then refined it in the following year. The cornerstones of this strategy remain unchanged and place the emphasis on sustainable, continuous corporate success. The aim is to equip Audi for the challenges of the future along its pathway to becoming the leading premium brand, and to delight customers worldwide. The issues and measures were further substantiated in 2012 and adjusted to reflect the prevailing economic and business environment. In particular, questions about growing environmental awareness, the future availability of fossil fuels, ongoing urbanization and increasing digitalization and connectivity play an important role in this context.

1.3. Mission: “We delight customers worldwide”

The Audi brand has placed evoking customer delight worldwide at the very heart of its strategy, as the key component of its mission. The brand values sportiness, progressiveness and sophistication are convincingly embodied by the products of the Audi brand. In addition to supplying technologically advanced, innovative automobiles, it aims to generate customer delight in a wide variety of other ways. The Audi brand has defined its understanding of customer delight in greater detail in the following four areas of action, which it examines, formulates and substantiates as part of an ongoing process:

We define innovation

We create experiences

We live responsibility

We shape Audi

1.4. Global image leader

A strong brand and a positive image are key success factors for a premium manufacturer. They pave the way for lasting corporate success. Our goal is therefore to keep steadily improving both our image position and our attractive product range, while binding customers emotionally to the Audi brand.

A large number of national and international awards in the 2012 fiscal year again served to confirm the positive image and public enthusiasm for the brand with the four rings.

2. Target Market of Audi

Profile: 

Ages between 25-60

Mostly male customers

Over 500.000 $ income 

Professional drivers:

These people need strictly performance. They need the most bang of the back.

3. SWOT Analysis of Audi

3.1. Strength

Available in both petrol and diesel variants with a huge product portfolio

Wide range to cars to choose from starting from Hatchback to Luxury SUVs

Equipped with superior features like parking sensors, LED illuminated interiors, Air bags, traction control and much more

Elegant styling of both interiors & exteriors

Latest technology like Quattro and FSI provide refined and efficient engine performance

Well established brand which helps in the brand recall

Has approximately 50,000 employees worldwide

The brand has actively been involved in motorsport and sponsorship of many sporting and premium events

3.2. Weakness

High maintenance & handling cost

Limited presence in emerging markets where some other brands have taken over the market

3.3. Opportunity

Expanding automobile market and available space

Opportunity to leverage brand recall and acquire newer customers

Expansion of product portfolio by entering into low cost cars

Increasing manufacturing capability to meet increasing demand generated through advertising

3.4. Threats

Increasing fuel costs

Competition from other big automobile giants

Product innovations and frugal engineering by competitors

Limitations due to government policies in entering foreign markets

4. Marketing Mix of Audi

4.1. Product

Audi produce only high-tech, modern, high quality cars. Audi has slogan “Truth of engineering”, what means all goods of this company must be on high level of all area technologies such as ecology, safety, comfortable and economy. Really, Audi’s cars comply with the slogan.  

4.2. Price

Audi’s cars have average price in the market, but this is the case of balance between price and quality. For example, Mercedes-Benz’s cars are much more expensive than Audi’s cars, but they have the same quality. I think the price of Audi’s cars oriented on middle-class and target audiences are men, because Audi’s cars are brutal.

4.3. Promotion

Clearly, the best way for promotion cars is racing, because everybody want to have race car in everyday life, especially men feel a lack in adrenaline. And racing is the best way to show customers that your car better, faster etc. Also, Audi promote their cars in films, for choice in films, which have many pursuit and racing. The last type of Audi’s cars promotion is advertising in men’s magazines.

4.4. Place

Audi has many show-rooms in a different areas of big cities. 

5. Strategies and Positioning of Audi

In a challenging market environment, the Audi brand set a new deliveries record in 2013 in handing over more than 1.45 million vehicles to customers. This positive development is primarily attributable to the attractive, diverse product range, which was again continuously revitalized and broadened in the period under review. Alongside the new Audi A3, which made its debut in the past fiscal year, the Audi brand added models such as the A1 Sportback and the sporty S6, S7 Sportback and S8 to its product range. 

The Company intends to increase deliveries of the Audi brand to 2.0 million vehicles by 2020. To that end it will maintain its product initiative and further increase its market shares in a large number of sales markets. The Audi Group is consequently adding to the number of its dealer and service outlets worldwide. The Audi Group’s worldwide production network is also undergoing steady expansion. Besides a new car production line, which is currently being built at Győr (Hungary), Audi is stepping up its presence with the construction of a new plant in Foshan (China) and the building of a new production location in San José Chiapa, Central Mexico.

A strong brand and a positive image are key success factors for a premium manufacturer. They pave the way for lasting corporate success. Our goal is therefore to keep steadily improving both our image position and our attractive product range, while binding customers emotionally to the Audi brand. A large number of national and international awards in the 2013 fiscal year again served to confirm the positive image and public enthusiasm for the brand with the four rings.

In order to realize its strategy of becoming the leading premium brand worldwide, the Audi Group is reliant on the expertise and commitment of the best and most highly qualified employees. Especially in light of its continuing international expansion and global presence, it is therefore exceptionally important for our Company to be perceived as an attractive employer worldwide. 

The Audi Group therefore offers its employees a challenging working environment with a wide range of opportunities to develop, as well as attractive, commensurate pay coupled with high job security. To assure a consistently high level of employee satisfaction, we regularly conduct internal employee surveys.

The Audi Group’s high attractiveness as an employer is moreover confirmed by a large number of external surveys conducted both nationally and internationally.




6. Brand Loyalty
Audi saw its brand loyalty, measured as the amount of repeat customers, grow by 4.9

percent in 2013. That's enough to beat the improvement of not just every luxury brand, but every carmaker in the world. The overall brand loyalty title went to Toyota, topping GM for the first time in nine years.

“Maintaining a solid loyal customer base is not easy, but it is essential to survive in today’s competitive environment,” said Stephen Polk, chairman, president and CEO of  R. L. Polk & Co. The truth of that statement is borne out in Audi's year-end sales totals, down just 5.7 percent against 2012.

7. Brand Awareness

Audi create sponsorship with automobile races and brands, TV shows, video games and movies. In addition conduct many advertisement projects. 

8. Perceived Quality

Audi is widely regarded as a premium brand and commands a premium price in the market. Audi products compete with other premium brands such as BMW, Mercedes-Benz and Jaguar. There are several factors that have allowed Audi to make this transition from mainstream to premium. One significant factor is their focus and investment in perceived quality.

Sources:

• http://www.audi.com/com/brand/en/company/investor_relations/audi_at_a_glance/corporate_strategy.html
• http://www.perceptualquality.com/audi-a3-perceived-quality/
• http://www.cbsnews.com/news/audi-builds-brand-awareness-as-it-plays-sales-catch-up-with-bmw/
• http://www.motorauthority.com/news/1041657_audi-awarded-for-most-improved-brand-loyalty
• http://andreybogomolov.wordpress.com/2012/11/10/audi-4ps/
• http://www.mbaskool.com/brandguide/automobiles/4884-audi.html

Thanks,

Serhat Oz