Describes the STP strategies of Jaguar Cars and its evolution

1. GOA INSTITUTE OF MANAGEMENT
Project Report
On
JAGUAR CARS
Submitted To:
Professor N. Meenakshi
Submitted by:
GROUP 5(Section A)
Gaurav Sharma (2015015)
Samyukta Paul (2015045)
Achyut Razdan (2015005)
Pranav Kakkar (2015035)
Milind Chauhan (2015025)
Sonia kerkar (2015055)

2. Introduction
Jaguar is a brand of Jaguar Land Rover which is owned by the Indian company Tata Motors since 2008.
Jaguar's business was founded under the name of Swallow Sidecar Company in 1922, originally making
motorcycle sidecars before developing bodies for passenger cars. Under S. S. Cars Limited, the business was
extended to complete cars. S. S. Cars was renamed as "Jaguar" in 1945. It merged with British Motor
Corporation in 1966,and then in 1968 it merged with Leyland Motor Corporation and became British Leyland,
itself to be nationalised in 1975.Jaguar was de-merged from British Leyland and then was acquired by Ford in
1990.
Jaguar has, in recent years, manufactured cars for the British Prime Minister.
Jaguar cars today are designed in Jaguar Land Rover's engineering centres located at Coventry and
Warwickshire, and are manufactured in Birmingham, The Company today employs over 10,000 employees.
Segmentation, targeting and positioning strategies of the brand in the
Indian market
Jaguar has always been in a leading position.It continues to occupy in spite of occasionalbudget constraints,the
position of being a product that provides ultimate customer satisfaction. The primary marketing objective of
Jaguar has been to strengthen its brand equity and achieve retailing mileage out of that.
Market segmentation involves dividing a broad target market into subsets of consumers, or countries who
have, or are perceived to have, common needs, interests, and priorities.
Targeting refers to choosing only those segments which seem attractive to the company and the company has
the capability to serve.
Jaguar uses the following bases for segmenting the consumer market and has targeted these segments
effectively by aiming at what customer from each of these segments look for.
1. Demographic Segmentation :
Demographic segmentation divides the markets based on variables such as age, gender, family
size, income, occupation, education, race and nationality.
Jaguar has done this segmentation based on factor such as age, gender and income.
Targeting:
Jaguar came out with Jaguar S-type which was targeted at the younger customer base.
The XE sports Sedan had a dual target, theyouth and women.
Jaguar’s XFR, XJL Super sport and XKR-S models are basically targeted at confident,
well-educated and intelligent individual who create businesses,technologies and lifestyles that
have an impact on our culture.
 The Jaguar XF series targeted the luxury car market (> Rs. 25 lakhs). This was for the high
net worth individuals in India.
Based on age, Jaguar has targeted the following groups, viz.

3. Successful professionals in the age group of 30-45 (singles and couples)
Executive families in the 40-50 age range (2+ children)
Aged individuals (couples aged above 50).
2. Psychographic Segmentation :
Psychographic segmentation is done based on lifestyle and personality traits.
Targeting:
With commercials like “Captured: Jaguar at play”, Jaguar tried to attract the confident,
powerful, independent individuals who love dynamism. The commercial used three of Jaguars
sports cars, viz. Jaguar’s XFR, XJL Super sport and XKR-S models to inflict upon the viewers
a sense of power and exhilaration when they sit behind the wheels.
 Jaguar’s luxury car range are targeted at those consumers who are successful,aristocrat and
have a status and lifestyle to maintain.
Brand Positioning
Positioning is a strategy that aims to make a brand occupy a distinct position, relative to the other competing
brands in customer’s minds.
The positioning strategy of Jaguar needs it to differentiate itself from its direct competitors, BMW, Audi, and
Mercedes in terms of performance, dependability and styling. All of its competitors being in the luxury car
brand range, Jaguar’s Point of Parity (PoP) lies in its constant appeal to the niche market of high net worth
individuals in the country and, its launch of expensive sports cars.
At the same time, Jaguar has managed to brand itself as truly different fromits competitors (PoD) by positioning
the brand as animate – seductive, emotional, unique, energetic and high performance – while posing the
question, “How alive are you?”The “Alive” campaign targets luxury consumers who are contemporary,
sophisticated and daring, and have a desire for authentic, independent brands. It also appeals to a more youthful
audience, while not alienating its current demographic.
Jaguar then launched a rebranding campaign with a new logo and a revamped brand image. In an attempt to
modernize the brand and appeal to a younger demographic, Jaguar introduced some elements into its logo
design that looks more 3-dimensional and introduces a chrome gradient effect.

4. The primary message of the campaign was Jaguar is ALIVE. It is a car not so much manufactured as is created.
The campaign was designed to capitalize on the existing emotional pull of Jaguar’s vehicles.
Evolution of STP strategies
Jaguar was launched in India in 2008 after it was bought by Tata Motors from Ford. In 2008 there were few
models to offer to Indian customers because of the price. As being a foreign brand all the cars were imported to
India due to which a hefty excise and customs were levied thus making them in the reach of few people.
Initially they were segmented and targeted for the following classes
 Rich businessmen and industrialist
 Top executives of big firm
It was positioned as top end luxury and premium car brand with class and elegance.
In 2010 they sold 884 cars including corporate order. With these sales they weren’t gone reach anywhere , thus
they change in strategy.
From the following points we can see the shift in these strategies
 They started assembling and manufacture of cars here in India which gave them respite from hefty
excise and duty, thus making their car cheaper and competitive
 Introduction of new models XE which is targeted to young executives, small businessmen thus
expanding their reach
 They kind of shed their luxury corporate image with introduction of sport car model Jaguar F type to
tap the population which love sports car
 Penetration in tier two towns like Aurangabad, Ludhiana etc. through which they increased their
Sales
Due to these changes their market share increased

5. Influence of environmental factors in shaping the STP strategies
For any business to grow and prosper, managers of the business must be able to anticipate, recognize and deal
with change in the internal and external environment. Environmental analysis is a tool to identify all the external
and internal factors that can affect the organization’s working.
PEST analysis is the most effective tool to anticipate the impact of the environmental factors. This tool provides
a holistic picture of the situation. It strategizes on the basis of Political, Economic, Social Cultural and
Technological factors.
Impacts of Political Factor
 Support for globalization- Political parties are
motivating for globalization
 Strong reputation and trust- New vehicle buyers
choose dealer based on reputation
 Low import duty
 Government golden share in the company- Designed
to prevent takeovers
Impacts of Economic Factors
 Highly trained and low cost work force
 Competitive labor cost model
 Highly mobile work force
 Economic developments have led to major upturn in
demand for luxury cars
 Oil prices and interest rates reduced
Impacts on Social Factors
 High uniqueness factor
Market Share in
2010
Other cars
Jaguar
Market Share in 2014
Other
Jaguar

6.  Moving towards Eco-friendly cars- Introduction of Jaguar XJ-e
 Technological awareness increases demand
 Promoting engineering career
Impacts of Technological Factors
 Technological diversification- Aerospace Industry
 Advanced production process
 Match new technologies- Intelligent self-learning cars
 User can study all intricacies online
 Strong R & D facilities- Collaboration with Intel
 Strong tie up- Chery Automobile Company, Universities
Other Factor Influencing the Strategy
Impacts of Demographic Factors
 Increasing High-Net-Worth Individuals- Grew at 20.8% to 1,53,000
 Target Audience- Male/Female between 30-50
 Trend for newer brands and higher environment friendliness
The PEST analysis proves that Jaguar has a very external environment.
Analysis of the attractiveness of the luxury car industry with respect to
Jaguar
Suppliers’ bargaining power: between low and medium
 The balance of power between supplier and car manufacturer in the luxury car industry is normally tilted in
favor of the car manufacturer, since the suppliers are numerous and often small-medium in size, while car
manufacturing companies are much larger and globalized.
 In the luxury segment such as Jaguar’s, suppliers are less weak, since luxury cars require exclusive materials
and manufactured parts of high quality (such as real leather and real wood interiors, high-technology devices
for entertainment) which only a smaller number of suppliers are able to deliver. This makes the switching
costs for luxury car manufacturers greater than those of mass market manufacturers. Also to be considered is
International sourcing, which is less of a threat, stemming from the need to preserve the image of excellence
and prestige which can restrict the ability to purchase parts fromfirms located in emerging countries.
 Thus, power of supplier in the luxury car industry can be rated as fair. Jaguar acquires most of its parts and
assemblies from foreign suppliers such as Autoliv BKI Spain,the world’s largest automotive safety supplier
(airbags, seat belts, and passive and active safety systems), Continental Automotive Systems Slovakia (brake
callipers), Brembo Poland (break discs) ZF Lemforder UK (assemblies, suspension, driveshaft, brake
assemblies etc.) amongst others.
Customers’ bargaining power: medium-high

7.  The power of buyers in the luxury car industry is also quite fair. Customers have a significant amount of
power, mainly due to the choice of large variety of luxury brands and product, and because of the presence of
substitutes. Customers can choose from many different brands and car models, with widely differing
performance, quality, appearance, pricing, additional features. This allows the customer to freely choose the
product that best fits her preferences, status and lifestyle. The Internet has improved customers’ access to
information about the characteristics of car models, and to the experience and reviews of past users and
experts. That forces premium car makers to improve continuously quality in order to not fail to meet the high
expectations of customers and also to not fall behind competitors’ innovations and improvements.
 Once a customer has purchased a car, there are moderate switching costs to change to another, since the
current car’s value will have to be reduced when it is sold in the used car market or returned to the car dealer.
Brand loyalty in the luxury car segment is higher than for lower-end cars, since customers tend to develop a
closer emotional relationship between their self-image and their car and brand (provided that the expectations
are being met).
 Another favorable factor for car companies is that the size of buyers and of their individual orders are small,
since most of the customers buy only one car every some years, reducing the significance of the behavior of an
individual customer.
 The presence of many substitutes to luxury cars enhances significantly the bargaining power of potential
customers. Customers likely become more cost conscious and switch to less glamorous but cheaper and more
efficient “normal” cars and thus may choose to use any of a wide range of transportation devices instead of
luxury cars.
Threat of substitutes: medium-high
 Luxury cars fulfill basically two needs for customers: provide a means of transportation, and assert the
privileged status of their owner. The first need can be fulfilled by a variety of other products, such as other
types of cars, motorbikes, bicycles, public transportation systems, planes. The most recognizable substitutes
for the luxury cars from Jaguar are either cars rolled out by Audi, BMW and Mercedes -Benz or higher-end
cars from ultra-luxury brands (Rolls Royce, Ferrari, Bentley, Lamborghini), or at the other end of the
spectrum, less expensive cars from non-luxury brands (Ford, Toyota, General Motors, Fiat).
 Higher-end brands can exert additional pressure by introducing some car models with lower-than-usual prices
or special discounts to allure customers with lower incomes than their traditional customer base. At the same
time, technological progress allows non-luxury car makers to include in their cars more and more of the
features and amenities initially reserved to luxury cars (for instance driving-assisting systems and touch
screens), forcing luxury brands to innovate at a fast pace to keep the appropriate level of differentiation and
superiority.
 Another major threat to car manufacturers’ sales is the presence of the used cars markets.
Premium brands of motorbikes such as Ducati and Harley-Davidson could be considered suitable substitutes
for luxury cars as both a transportation device and a status symbol.

8. Threat of new entrants: between low and medium
 The luxury car industry is protected by significant barriers to entry and thus the threat of new entrants is
relatively low. One of the most significant barriers comprises the brand equityenjoyed by most established
brands. The repute of the brand is extremely important to customers; luxury brands such as Jaguar, Mercedes -
Benz, BMW and Audi have a long and magnificent history to boast about, and the companies work hard to
preserve the association between them and other symbols of individuality and of top-notch quality and
performance.
 Although several Asian companies have developed new luxury brands to compete with the traditional
European and American brands, it is extremely difficult for challengers to match the prestige of brands with
years of history.
 Another challenging barrier to entry is the huge initial investment required to enter car markets in general.
Large amounts of capital are required to set up manufacturing facilities and invest in R&D, among other large
expenses. This also creates large sunk costs and makes it hard to achieve economies of scale. The capital
requirements are one of the main reasons why new luxury brands have been produced by companies which
were already present in the market as large car manufacturers (Toyota’s Lexus and Nissan’s Infiniti) and not
by new, free-standing, companies.
 Other protective factors include the high degree of product differentiation and of competition in the industry,
which make it less attractive.
Competition between established firms: high
 Competitive rivalry in the luxury car segment is extremely high as Luxury car concentration in the industry is
not very high in the advanced markets, and a variety of very different brands with different origins and tactics
compete. The rivalry between companies is rather intense, especially with Jaguar in the Indian market mainly
due to the presence of the three global leaders: Audi, BMW and Mercedes-Benz. These three companies
compete hard to attain not only market leadership in all the major markets, but also to be recognized as the top
luxury brand in customers’ perception not only in India but every country across the world. The ascent of
Jaguar from “outsider” to “significant challenger” to Audi, BMW and Mercedes Benz has further contributed
to make rivalry even harsher. Further to this, the competition has extended from the advanced markets to the
emerging markets, where each company hopes get a privileged grip to take advantage of the future growth of
middle classes.
 Jaguar explicitly recognizes each of the three companies as competitors, and their public statements and
advertising and promotional campaigns make provocative comparison between the cars as to performance and
innovativeness. Technological innovation is one field of fierce competition, as each of the companies claimto
be technological leader in the industry. Competition on pricing is also intensified.
 In addition to the old competitions between market leaders, there are also challenges posed by the new luxury
brands developed by the large successfulAsian car manufacturers such as Hyundai, Honda, Toyota and Nissan
which are challenging the Western brands including Jaguar in their home markets by developing new brands
and offering customers cars with lower prices and better fuel efficiency.

9.  The presence of significant sunk costs is a barrier to exit which causes even companies in loss to stay in the
market, thus increasing the degree of competition in the industry.
A Complementary 6th Force:
 The complementary segment in the luxury car industry is relatively significant as this factor provides for a
dynamic component to the 5 forces frame work. This factor allows the industry players to acknowledge their
interdependencies. A complementary product in this context would be anything related to usage of the luxury
car and would include and not be limited to fuel, tires and services such as insurance, loans etc. When a
manufacturer has total control over these services or goods, it imparts to hima significant advantage over his
competitors and the complementary goods only provide for added value, apart from achieving added power
over supplier and consumer all at once. This helps to minimize competition and provides for a clear advantage
to the manufacturer. For example: Tata’s Financial Services as a complementary that can assist/provide for
Jaguar’s sales in India.
To conclude, the luxury cars industry is moderately attractive considering the relatively low suppliers’ buying
power and threat of new entrants alone; but taking into account the high buyers’ bargaining power, the high
threat of substitutes and the intense degree of competition between the top companies, the overall profile of
industry is rather unattractive.
Understanding consumer behaviour
Luxury cars like jaguar are preferred by HN1 (high Net worth individuals).These individuals want to
differentiate themselves from the crowd and project themselves as the high social status individuals. High social
status from perceived brand image of Jaguar is the most common driving factor of its segments. Jaguar has
presence in terms of their showrooms and its dealer outlets only in the very premium urban areas of India.
Jaguar cars are financially confined for many people, and therefore seen as “true status symbol” or a “symbol of
sheer success”.
Factors that influences Consumer Behaviour
 Socio-cultural Factors
Customers of Jaguar have high sense of prestige and status wherever it travels. Jaguar cars are not for masses at
all rather it focuses it on the classes. The exclusivity and uniqueness of jaguar influence the brand conscious
consumer. Marketers of Jaguar have tapped on the status-symbol potential of the brand “jaguar”.
 Personal Factors
Occupation and economic circumstances of the customers influences consumption patterns. The purchasing
power of Indians is in an increasing trend. Increase in disposable income of the consumers has influence the
buying behaviour of the consumers. Also, Brand personality of Jaguar: upper-class, exclusive, classy,
sophisticated, also attracts the consumers with the same personality. Lifestyle preferences of the Indian

10. consumers have changed with the shift of consumer attitude towards from affordability to quality, pleasure and
design which has suddenly accelerated business in luxury car segments.
 Motivation and perception
The brand Jaguar fulfils the esteem needs and Self-actualization needs in the Maslow’s Hierarchy of Needs.
Jaguar’s Super luxury cars have become as the status symbol and a matter of esteem. Consumers of jaguar like
to flaunt their cars as their prized possession. The frequent use of jaguar cars stimulates the perception of an
“ultra luxury life” the consumers gain from their possession. Jaguar‘s “unique driving experience” is one of the
consumer’s motivation factor.
A Brand Awareness consumer centric campaign ALIVE was launched to tap on the Indian luxury car segments.
The Brand awareness of jaguar was low when it came to India. So, company decided to launch a consumer-
centric campaign – “How Alive are you?” to establish the “Jaguarness”of its products.
Product Life Cycle
GLOBAL TREND
Swallow Sidecar company launched its first product ‘motorcycle sidecars’ in 1922. In the following years it
started expanding its business by producing complete carsfor passengers. In 1931, the famous S.S models were
launched and in 1935, the name Jaguar was adopted by the company and S.S model were renamed as S.S
Jaguars.

11. After 1950’s we saw a further surge in the company’s growth rate and the strengthening of the market share.
Lyons and his senior engineers, decided to come up with a product which was stylish and had real performance.
Only a handful of themwere supposed to be built. The XK 120 which was built on this thought process stole the
1948 motor show. This growth continued till 1960’s but Jaguar lost its independence as it got merger British
Motor Company to form British Motor (holdings) Limited. Within no time, it was realized the combination was
poor with too many financial difficulties.
Over the next few years, insufficient capital was the major reason for Jaguar to not come with a new product. In
July 1984, Jaguar was listed as a separate company on the stock market to track its own record. The main
problems faced by jaguar at this time was quality control, lagging delivery schedules and poor productivity
In 1980’s, Ford bought Jaguar and over 20 years spent about 10 billion dollars to keep the brand floating in the
market. Jaguar reported loss year after year which ended in 2008 when Tata Motors came into the picture.
INDIAN TREND
In case of JLR India, the product was launched in 2009 entering the introduction phase of a new product. Within
two years we see a regular growth of the product. The products haven’t reached the maturity level as it will be
too early to come to that conclusion. That is why our product life cycle only shows first two phases of PLC.
In 2014, we see a small drop in the sales as it was due to the discontinuation of Freelander and some issues in
the manufacturing plant in Pune. Looking at the trend in India, It is expected to grow at higher pace and with the
launch of XE model in the upcoming year, it will be able to take on AUDI, BMW and Mercedes lower end
models.
Sales

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