Ford Ka in France
1) Evaluation of Ford’s strategy in the small car market in France
New Product Development. Approaches to New Product Development (NPD) can be divided into innovative strategies, and customer-responsive strategies. Innovative strategies results in a higher degree of (actual and often perceived) newness but involve higher R&D costs and risk. Customer-responsive strategies allow to cut development costs and time-to-launch; however, it might be difficult to achieve a differentiated position in a competitive market.
Ford’s approach was that of a Reactor. It observed that it needed a new product to address new customer needs. However, instead of applying information on customer needs in the process of developing a new car, the customer perspective only emerged in the search of a target market. The customers’ opinion was polarized.
Non-consideration of customer needs in the process of NPD results in a challenging positioning task. Physical products speak through their attributes to the customer – something that happens independent of positioning and advertising efforts. The success of positioning depends on how well the tangible attributes match with intangible benefits that the company wants its product to have. Ford attempted to create a car “that was out of the ordinary” for an “educated customer who is self-confident and rejects the commonplace”. Since customer research was conducted after product design the question is how Ford could know what the desired target customer wanted. The engineer might have had his thoughts about the realization but his ideas do not necessarily reflect those of future buyers. The highly successful Twingo might have been an influencing source in the development. The fact remains that the car was developed without a target customer in mind. That might be the reason why, despite its innovative styling attributes, Ford Ka could not alter consumer perceptions of what a small car can offer to the extent the Renault Twingo did.
Cost
New Product Development. Approaches to New Product Development (NPD) can be divided into innovative strategies, and customer-responsive strategies. Innovative strategies results in a higher degree of (actual and often perceived) newness but involve higher R&D costs and risk. Customer-responsive strategies allow to cut development costs and time-to-launch; however, it might be difficult to achieve a differentiated position in a competitive market.
Ford’s approach was that of a Reactor. It observed that it needed a new product to address new customer needs. However, instead of applying information on customer needs in the process of developing a new car, the customer perspective only emerged in the search of a target market. The customers’ opinion was polarized.
Non-consideration of customer needs in the process of NPD results in a challenging positioning task. Physical products speak through their attributes to the customer – something that happens independent of positioning and advertising efforts. The success of positioning depends on how well the tangible attributes match with intangible benefits that the company wants its product to have. Ford attempted to create a car “that was out of the ordinary” for an “educated customer who is self-confident and rejects the commonplace”. Since customer research was conducted after product design the question is how Ford could know what the desired target customer wanted. The engineer might have had his thoughts about the realization but his ideas do not necessarily reflect those of future buyers. The highly successful Twingo might have been an influencing source in the development. The fact remains that the car was developed without a target customer in mind. That might be the reason why, despite its innovative styling attributes, Ford Ka could not alter consumer perceptions of what a small car can offer to the extent the Renault Twingo did.
Cost