Case Study:KIA    

Creating value through the marketing mix

The KIA Motors Corporation, based in South Korea, has 12 manufacturing and assembly plants and subsidiaries in 165 countries around the world. Globally the Hyundai KIA Group is now the fourth largest car company in the world. Kia Motors UK has more than 166 dealerships. It also has plans to grow the network to support the increasing demand. Kia is a relatively new entrant to the UK car market. However, it has become more well known in recent years. Kia does not have the same level of brand heritage in the UK as it does elsewhere in the world. Kia aims to overcome this through its massive ambition and plans for growth in the European market.

Process of planning at the very top of an organization. Senior managers determine the long term aims of the organization. An aim for Kia is to become a major player in the UK car market. A process of research through which customer needs are identified then follows planning. A business then has to establish processes that enable it to satisfy these needs. Kia wants to bring a fresh, fun and dynamic approach to the UK car market. Its marketing strategy supports its objectives with a focus on increasing brand awareness. It aims to emphasize the great design and quality of Kia's products, while still offering competitive prices.Kia-sportageThe marketing mix comprises of the 4Ps and is a useful way of summarizing the marketing strategy of an organization. Every organization will have a unique marketing mix. Organizations need to create a unique mix of:

• the right product, sold at the right price, in the right place, using the most suitable promotion

For example, the marketing mix for Kia is based around:

• product - good design and quality alongside a high level of customer service, Kia's unique selling point is its 7-year warranty
• price - competitive prices provide an advantage over competitors
• place - with 166 dealerships there is a large and expanding number of outlets
• promotion - this includes a new sponsorship in cricket and long-term partnerships in football and tennis.

Promotion is about communicating with customers and potential customers. It has a number of purposes, for example:

• to increase awareness - such as the range of vehicles Kia offers
• to raise brand recognition - this is important in an industry with over 30 major players in the UK
• to increase demand - thereby helping to meet the objective of growth in the UK
• to improve brand perception - promotion communicates the fun approach of the Kia brand
• to highlight the superiority of the product - e.g. the high quality and great design of Kia cars.

AIDA

The acronym AIDA is useful when developing a promotional mix. Promotion activities help to:

There are a number of approaches to promotion that are open to organizations. Above-the-line promotions use mass media methods. This type of promotion focuses on advertising to a large audience. It includes print, online media, television and cinema advertising.

As the fourth largest car company in the world, Kia is a big brand. It offers a range of products targeted at different market segments.kia-piccanto Above-the-line activities include adverts in the press. They also produce online banner advertisements, place advertisements on billboards and use their website to meet the needs of their consumers. Recent TV advertising campaigns have included the 'small yet mighty' cat for the new Picanto and the 'future proof' Kia cee'd, emphasizing the 7 year warranty. TV advertising has also been used to relay the message that Kia is an official FIFA partner.

Making a message memorable to a large audience is not always easy. It is difficult to tailor a promotion to a specific group of consumers through above-the-line promotions. This is because a mass audience with different tastes and needs views it. Above-the-line promotion is also very expensive.

Answer the following questions:

Question 1:

The first four steps in the marketing process involve building customer relationships. The final step involves capturing value in return.

a. Describe what is meant by customer relationship management?

b. What are the different relationship levels companies can build with customers?

c. In respect to customer relationship management concept and referring to the case above, explain what did KIA focus on in order to retain and gain its customers loyalty?

Word count: 300 words

Question 2:

Given the global nature of KIA'soperations;

a. Describe the main micro-environmental forces that affect the company's ability to serve its customers. Elaborate your answer by extracting examples from the case.

b. What is the marketing strategy adopted by KIA to compete with other brands offering similar products? Justify your answer by referring to the case above.

c. How KIA highlight the superiority of the product.

Word count: 400 words

Question 3:

The marketing mix is the set of controllable, tactical marketing tools that the firm blends to produce the response it wants in the target market.    

a. Explain how KIA managed to balance its marketing mix strategy. How did it manage each of the marketing mix components? The students should begin by explaining the marketing mix component while referring to BE200 material and then apply it to the case.

b. Discuss how KIA succeeded in differentiating and positioning its products for maximum competitive advantage in the marketplace?

c. Compare and contrast undifferentiated, differentiated and concentrated targeting strategies. Which strategy do you think is the best?

Word count: 500 words

Grades deduction for:

TMA Presentation:

Up to 5 marks should be deducted for poor presentation or poor organization of the TMA outline and discussion or TMA presented without PT3.

Proper referencing:

Referencing should be both in-text referencing, plus a list of references at the end using Harvard style. Up to 5 marks should be deducted for poor referencing.

Use of E-Library:

A minimum use of 2 articles from AOU e-library is required to support the discussions. Up to 5 marks should be deducted for no use or poor use ofe-library.

Word count:

The answers should be within the specified word count. A deviation of 10% is acceptable; if more, a deduction up to 5 marks will be applied.

Arab Open University Definitions of cheating and plagiarism

Plagiarism means copying from internet, from unreferenced sources, from other students' TMAs or any other source.  Penalties for plagiarism range from failure in the TMA or the course, to expulsion from the university.

According to the Arab Open University By-laws, "the following acts represent cases of cheating and plagiarism:

• Verbatim copying of printed material and submitting them as part of TMAs without proper academic acknowledgement and documentation.
• Verbatim copying of material from the Internet, including tables and graphics.
• Copying other students' notes or reports.
• Using paid or unpaid material prepared for the student by individuals or firms.
• Utilization of, or proceeding to utilize, contraband materials or devices in examinations."

Penalty on plagiarism: The following is the standard plagiarism penalty applied across branches as per Article 11 of the university by-laws was revisited and modified to be more explicit with regard to plagiarism on TMAs. Penalties include the following:

1) Awarding of zero for a TMA wherein more than 20% of the content is plagiarized.

2) Documentation of warning in student record.

3) Failure in the course to dismissal from the University.

4) All University programs are required to apply penalties that are consistent with the University by laws.