Part 1: Jeep Compass Proposal
Chrysler, which is the maker of the Jeep Compass, is an international automaker of which the main brands are Jeep, Ram SRT, Fiat, Mopar and Dodge. The company has been mostly owned by Italian manufacturer, Fiat, since 2009. Prior to that year, Fiat owned approximately 20 per cent of Chrysler. In 2012, Fiat eventually became the owner of approximately 62 per cent of Chrysler.
Chrysler`s Jeep Compass was introduced to the market in 2007 as a compact crossover SUV. While the vehicle also comes in a 4×4 version, it is most widely recognized as a Jeep model that is most appropriate for the city. The vehicle is relatively low to the ground than the typical Jeep vehicle, so it is less capable of maneuvering on off road terrain. However, terrain that isn`t too difficult to navigate while off road is fair game.
The Jeep Compass is considered one of the lower priced SUVs on the market. It is priced at about $20,000 new. The price fluctuates depending on the features that are added. The vehicle has options including leather seating, automatic transmission, four-wheel drive and power windows, for example. Each of these features adds approximately $400 to the face value of the vehicle.
The Jeep is sold either online by placing an order through a Jeep dealership, or by visiting a car dealership. Like any vehicle at a car dealership, the vehicle can be test driven before a purchase is made. Jeep dealers are riddled throughout North America.
Jeep Compass`s are often promoted during TV commercials. The product has targeted people living in cities who are relatively young and active. The commercials depict the vehicle being driven both in the city and it off road terrain. The cargo space is often featured in advertisements, along with families who are camping or doing another outdoor activity.
The Jeep brand has a line of sport utility vehicles, off-road vehicles and pickup trucks. The company has recently focused on vehicles that are more targeted at city dwellers who like the cargo space and look of the Jeep. These models include the Compass and Patriot.
The Jeep Compass is considered a compact SUV that is suitable for some outdoor recreation such as camping, but also for driving around the city.
The Jeep Compass’s direct competitor is the Ford Explorer. The Explorer came out around the same time as the Compass, in 2007, and this vehicle has many of the same features of the Compass. The relative look is the same, and when I was visiting dealerships and inspecting the Jeep Compass, I noticed that this model was almost always compared to the Jeep. The price of the Explorer is roughly $5,000 more than the price for the Compass.
Why the brand`s market position needs to be improved.
Jeep Compasses haven`t received the type of ratings that the Jeep brand is known for. The company has steadily tried to address features that critics say were lacking, such as safety. The safety feature that was added in 2009 was airbags from back seats and side door panels, in addition to the already installed steering wheel and passenger airbags. However, there has been some criticism over sights. For example, the portion of the vehicle between the windshield and the doors is quite bulky and can create a blind spot. The Compass hasn’t sold as much as the Explorer. In the most recent year’s stats, 2011, the Explorer sold 135,179, (2011 Ford, 2012), while the Compass sold 47,709, (Chrysler, 2012). While the sales of the Compass have increased, it could improve its sales over the Explorer by adjusting its communications strategy to include a greater emphasis in targeting city dwellers, as there is a higher percentage of people in the city over those in the country to whom Jeep has targeted more efficiently in the past. The Compass is the link between Jeep and metropolitan areas. Additionally, the company can link the rich Jeep history with its current products.
Part 2. Brand Audit
1. What is the core proposition of the brand?
Jeep intends to attract business from people who want to have a vehicle that is reliable and looks good. The brand has been around since 1941 and was first implemented as a wartime vehicle, which gave it the reputation of being a reliable product. The company has moved away from its rugged nature more recently and is targeting its product not only to those who want to take it off road, but also to those who live in the city. The company’s core proposition is to be a go-to source for people wanting reliability and style. This has driven the company to much success and acclaim among Jeep enthusiasts. The value proposition puts its price in the competitive category. It wants to provide an original vehicle that is of excellent quality, (Lawton, N.D.).
2. What do the stakeholders think about the brand?
The price of the Jeep varies greatly depending on the model. The Jeep Wrangler costs in the low $30,000’s, while the Jeep Compass costs nearly $20,000. This gives the brand a wide range of appeal. People view it as a vehicle that is practical for the city, but also capable in the country. This provides a perfect hybrid for city dwellers who also want to go on a camping trip, for example. The towing capacity is another major feature, and it is one that will increase the price. The 4×4 models have a better ability to tow. While the Compass can add 4×4 if requested by the purchaser, it doesn’t come standard. However, it does with the Wrangler. The Jeep brand has developed a loyal following of people who have commended its reliability.
3. What activities is the direct competition involved in that influence your brand, such as offering new brand extensions, promotions, co-operative advertising, sponsorship, etc.?
Ford is much more active than Jeep in advertising. This has caused Ford to sell many more models of its Explorer than Jeep has of its Compass. Also, while the vehicle is priced higher, it also has many more discounts. Jeep is offering a lot of cash back on its products right now. With the Compass, Jeep is offering $1,750 consumer cash/bonus cash or $52 per week at 4.49 per cent financing with $0 down payment, (Manufacturers, 2012). At Ford, they are taking a more aggressive approach, which they can do because the vehicle is priced higher. They are offering 0 per cent financing and up to $7,000 in manufacturer’s rebates, (Any Terrain, 2012).
4. Provide information on the following points in the brand audit:
1. Brand’s positioning
Jeep has consistently positioned itself as a leader in the off road vehicle category. It is one of the first off road vehicles on the market, as it came out in 1941. It has since transformed into offering a wide range of products that appeal to people of various demographics.
2. Brand’s differentiation points
Jeep differentiates itself from the competition by having a link with a long history of performance. The brand hits home with many Americans because it was a wartime vehicle. It then branched out from there. There is no other brand on the market that can lay such a claim to being an important part of wars. This is a huge hit in the United States.
3. Brand’s relevance
Jeep is meeting the demand of tens of thousands of drivers who want off road capabilities. Not only do they appeal to the off roaders, but also to city people looking to get around in the metropolitan area.
4. Brand’s identity
The company’s brand identity can be seen clearly in the style of advertisements it has. The dealerships wants to appeal to as many people as possible, and so it features ads that strike a chord with various ages and lifestyles.
5. Brand’s relationships
Jeep aims to get people to stay with the company for life. This is why it has so many models that appeal to people of all ages. After purchasing a Jeep, the company will send new promotions every several months, unless you cancel these. This keeps people thinking about buying a Jeep. They will also offer for you to trade your old vehicle in for a new one. They say in these advertisements that they have a shortage of the particular model and that is why they are offering such a high price for the trade in. These mail advertisements are likely lying, but it maintains a relationship with the customers.
6. Brand’s target market segments
The brand is targeting people of virtually all demographics. However, they are most actively seeking customers that are relatively young and who have a modest-to-high income. The prices reflect the income that the customer would need in order to buy the product, and this usually ranges from the high teens to the low $30,000s.
5. What areas would you as a marketer need to focus on to improve the brand’s performance and equity?
Jeep needs to establish itself over the competition. Ford has an extremely active advertising campaign, with a massive budget. This is hard for Jeep to penetrate, but the company could put more effort into advertising so that sales of its Compass can improve over sales of the Explorer. Unlike Ford, Jeep has the ability to strike a wartime nostalgic chord with consumers.
As mentioned, there aren’t many companies that can say they were a part of the army in previous wars as far back as World War II. Commercials about the history of Jeep could remind people of its authentically American appeal. This campaign would also have bearings in Canada, because it shows how tough the vehicles actually are. I’ve seen similar advertising used by companies that have a long history, including by Ford. These commercials highlight the past achievements and then introduce a new product. This could be extremely effective for Jeep and the Compass, as Chrysler tries to draw a connection between the history of the vehicle and what it can do for purchasers now.
“2011 Ford Brand Sales up 17 Percent for the Year in U.S.” (2012). Ford News.
“Chrysler Group LLC U.S. Sales Summary Thru December 2011.” (2012). Chrysler.
Lawton, T. (N.D.) Assembling Your Business Model. Thomas Lawton.