| Consumer Markets and Consumer Buyer Behavior 163

Chapter 5 | Consumer Markets and Consumer Buyer Behavior 163

threw more sand in Porsche’s tank. By 1990, Porsche sales had Although some Porsche traditionalists would never be caught plummeted, and the company flirted with bankruptcy.

dead driving a front engine Porsche that has more than two doors, Porsche insists that two trends will sustain these new models. First,

RETURN TO ITS ROOTS?

a category of Porsche buyers has moved into life stages that have But Porsche wasn’t going down without a fight. It quickly recog-

them facing inescapable needs; they need to haul more people nized the error of its ways and halted production of the entry-level

and stuff. This not only applies to certain regular Porsche buyers, models. It rebuilt its damaged image by revamping its higher-end

but Porsche is again seeing buyers enter its dealerships that oth- model lines with more race-bred technology. In an effort to regain

erwise wouldn’t have. Only this time, the price points of the new rapport with customers, Porsche once again targeted the high end

vehicles are drawing only the well heeled, allowing Porsche to of the market in both price and performance. It set modest sales

maintain its exclusivity. These buyers also seem to fit the achiever goals and decided that moderate growth with higher margins

profile of regular Porsche buyers.

would be more profitable in the long term. Thus, the company set The second trend is the growth of emerging economies. out to make one less Porsche than the public demanded. Accord-

Whereas the United States has long been the world’s biggest con- ing to one executive, “We’re not looking for volume; we’re

sumer of Porsches, the company expects China to become its searching for exclusivity.”

biggest customer before too long. Twenty years ago, the United Porsche’s efforts had the desired effect. By the late 1990s, the

States accounted for about 50 percent of Porsche’s worldwide brand was once again favored by the same type of achiever who

sales. Now, it accounts for only about 26 percent. In China, many had so deeply loved the car for decades. The cars were once again

people who can afford to buy a car as expensive as a Porsche also exclusive. And the company was once again profitable. But by the

hire a chauffeur. The Cayenne and the Panamera are perfect for early 2000s, Porsche management was again asking itself a famil-

those who want to be driven around in style but who may also iar question: To have a sustainable future, could Porsche rely on only

want to make a quick getaway if necessary. the Porsche faithful? According to then CEO Wendelin Wiedeking,

The most recent economic downturn has brought down the “For Porsche to remain independent, it can’t be dependent on the

sales of just about every maker of premium automobiles. When most fickle segment in the market. We don’t want to become just

times are tough, buying a car like a Porsche is the ultimate de-

a marketing department of some giant. We have to make sure ferrable purchase. But as this downturn turns back up, Porsche is we’re profitable enough to pay for future development ourselves.”

better poised than it has ever been to meet the needs of its cus- So in 2002, Porsche did the unthinkable. It became one of the

tomer base. It is also in better shape than ever to maintain its last car companies to jump into the insatiable sport utility vehicle

brand image with the Porsche faithful and with others as well. (SUV) market. At roughly 5,000 pounds, the new Porsche

Sure, understanding Porsche buyers is still a difficult task. But a Cayenne was heavier than anything that Porsche had ever made,

former CEO of Porsche summed it up this way: “If you really want with the exception of some prototype tanks it made during WWII.

to understand our customers, you have to understand the phrase, Once again, the new model featured an engine up front. And it

‘If I were going to be a car, I’d be a Porsche.’” was the first Porsche to ever be equipped with seatbelts for five.

As news spread about the car’s development, howls could be

Questions for Discussion

heard from Porsche’s customer base. But this time, Porsche did not seem too concerned that the loy-

1. Analyze the buyer decision process of a traditional Porsche alists would be put off. Could it be that the company had already

customer.

forgotten what happened the last time it deviated from the mold?

2. Contrast the traditional Porsche customer decision process to After driving one of the first Cayenne’s off the assembly line, one

the decision process for a Cayenne or a Panamera customer. journalist stated, “A day at the wheel of the 444 horsepower

3. Which concepts from the chapter explain why Porsche sold so Cayenne Turbo leaves two overwhelming impressions. First, the

many lower-priced models in the 1970s and 1980s? Cayenne doesn’t behave or feel like an SUV, and second, it drives

4. Explain how both positive and negative attitudes toward a two-and-a-half ton beast that could accelerate to 60 miles per

like a Porsche.” This was no entry-level car. Porsche had created a

brand like Porsche develop. How might Porsche change hour in just over five seconds, corner like it was on rails, and hit

consumer attitudes toward the brand? 165 miles per hour, all while coddling five adults in sumptuous

5. What role does the Porsche brand play in the self-concept of leather seats with almost no wind noise from the outside world.

its buyers?

On top of that, it could keep up with a Land Rover when the pave- ment ended. Indeed, Porsche had created the Porsche of SUVs.

Sources: Christoph Rauwald, “Porsche Raises Outlook,” Wall Street Last year, Porsche upped the ante one more time. It unveiled

Journal, June 18, 2010, accessed at http://online.wsj.com/article/ another large vehicle. But this time, it was a low-slung, five-door

SB10001424052748704122904575314062459444270.htm; Jonathan luxury sedan. The Porsche faithful and the automotive press again

Welsh, “Porsche Relies Increasingly on Sales in China,” Wall Street Journal, gasped in disbelief. But by the time the Panamera hit the pave-

April 2, 2010, accessed at http://blogs.wsj.com/drivers-seat/2010/04/02/ ment, Porsche had proven once again that Porsche customers porsche-relies-increasingly-on-sales-in-china/; David Gumpert, “Porsche on Nichemanship,” Harvard Business Review, March/April 1986,

could have their cake and eat it to. The Panamera is almost as big pp. 98–106; Peter Robinson, “Porsche Cayenne—Driving Impression,” Car as the Cayenne but can move four adults down the road at speeds

and Driver, January 2003, accessed at www.caranddriver.com; Jens Mein- of up to 188 miles per hour and accelerate from a standstill to

ers, “2010 Porsche Panamera S/4S/Turbo—First Drive Review,” Car and

60 miles per hour in four seconds flat. Driver, June 2009, accessed at www.caranddriver.com.

Part 1: Defining Marketing and the Marketing Process (Chapters 1–2) Part 2: Understanding the Marketplace and Consumers (Chapters 3–6) Part 3: Designing a Customer-Driven Strategy and Mix (Chapters 7–17) Part 4: Extending Marketing (Chapters 18–20)

6 studied final consumer buying to-business marketing is a way of life at Boeing. All of the aerospace

Business Markets and Business Buyer Behavior

Chapter Preview We begin by looking at another American icon—Boeing. Business-

In the previous chapter, you

behavior and factors that influence it. In this chapter, we’ll do the same giant’s more than $60 billion of annual revenues come from large or- for business customers—those that buy goods and services for use in

ganizational buyers—commercial airlines, air-freight carriers, and gov- producing their own products and services or for resale to others. As

ernment and military buyers. Selling airplanes to large organizational when selling to final buyers, firms marketing to business customers must

buyers is a lot different from selling cars or cameras to final consumers. build profitable relationships with business customers by creating supe-

And the stakes are significantly higher.

rior customer value.

Boeing: Selling to Businesses—The Stakes Are Much, Much Higher

M car ads, talking with friends or salespeople to get their advice, world’s first jumbo jet. Boeing military aircraft include massive

ost times, buying a new car is an involved and ing. “The word big does not begin to describe Boeing,” says one time-consuming process. Before committing to

analyst. As the world’s commercial aviation leader, Boeing’s spend $15,000 or more, you spend lots of time

12,000 planes dominate the skies. Its small but popular 737 is the searching the Internet for information, watching

workhorse for many airlines, and its giant, two-level 747 was the

and visiting dealer lots to check out competing models and take cargo planes and tankers, Chinook and other helicopters, and test drives. New cars are expensive, and you expect to live with

the F-22, the nation’s newest, fastest, and most-expensive mili- your decision for several years. So you want to get it right.

tary fighter. Boeing even operates the space shuttle and the in- Now assume that you are a member of the aircraft purchas-

ternational space station, and it is working on the next ing team at All Nippon Airways (ANA), Japan’s second-largest

generation of space vehicles to replace NASA’s shuttle fleet. airline. Your team is charged with making recommendations for

At a general level, selling commercial aircraft to large busi- the purchase of 50 new airplanes for the company’s fleet, at a to-

ness customers is like selling cars to final consumers. It requires tal cost of more than $5 billion. All of a sudden, by comparison,

a deep-down understanding of customer needs and a customer- your new car purchase decision looks pretty simple. The differ-

driven marketing strategy that delivers superior customer ence, of course, is that new airplanes aren’t lined up in dealer-

value. But that’s where the similarities end. Boeing sells to only ship showrooms. You can’t go down to the lot to kick the tires

a relatively small number of very large buyers worldwide. It has and test-fly a new plane. And there are a lot more dollars at stake.

only three major commercial airline competitors: Airbus, Lock- In this case, before shelling out more than $150 million per

heed Martin, and Northrup Grumman. And buying a batch of plane, ANA’s high-level buying team completed an arduous

jetliners involves dozens or even hundreds of decision makers evaluation of its own needs and available aircraft offerings. You

from all levels of the buying organization, and layer upon layer can just imagine the research, evaluation, and debate that went

of subtle and not-so-subtle buying influences. Moreover, into making such a multibillion dollar buying decision. ANA fi-

whereas it might be disappointing when a car buyer chooses a nally announced that it would buy 50 Boeing 787 Dreamliners.

competing brand, losing a single sale to a large business cus- More recently, the company announced that it would also buy

tomer can cost Boeing billions of dollars in lost business. five Boeing 777s and five 767s, worth another $2 billion.

It takes more than fast talk and a warm smile to sell expen- Those are mind-blowing figures by almost any standard—

sive high-tech aircraft. Before any sale, a team of Boeing com- $5 billion; $2 billion. But it’s kind of business as usual for Boe-

pany specialists—sales and design engineers, financial analysts,