Perhaps the most recognized piece of information about Volkswagen is the recent emissions scandal that rocked the automaker’s decades of brand development. However, little is known about the company’s humble beginnings in 1904 when a design concept from an Austrian engineer Ferdinand Porsche was transformed into the World’s first affordable vehicle. Currently, the company remains under the management of the Porshe family. Wolfgang Porshe is the head of the family that owns the Volkswagen Group, a holding company that owns Volkswagen and its subsidiaries, including Audi, Skoda Auto, SEAT, Porshe, Lamborghini, Bugatti, and TRATON. Despite the current success, and expansion, in the 1930s, the German automotive industry only specialized in the design and manufacture of luxury vehicles. Owning a car was a preserve of the affluent demographic in society. This state of affairs subjected ordinary Germans to ownership of nothing beyond motorcycles.
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At the request of the former German dictator, Adolph Hitler, Ferdinand Porsche who owned a vehicle design company developed a basic vehicle capable of transporting two adults and three children at a record-setting speed of 62 miles per hour. The car would be available at the price of a motorcycle. Thus, a distinctive round shaped vehicle with a rear-mounted, air-cooled engine became a reality and marked the beginning of a successful family business empire.
Volkswagen experienced tumultuous times during the second World War on a scale that could have brought an end to the budding company. When the Second World War gained large-scale momentum in 1939, Volkswagen had only managed to develop a handful of vehicles and the company had to devise a survival mechanism. Shattering the enemy’s critical infrastructural assets became a notorious characteristic of most wartime generals, and Volkswagen became a victim of this strategy. The factory’s manufacturing plant was levelled through bombing, and the company had to survive by manufacturing vehicles for the British army. Subsequently, when the Second World War ended, Volkswagen put under the control of Britain. The resumption of business had a semblance of instantaneous success when by 1946 the company had sold more than 10,000 units of the vehicle. And after a decade, the company had sold more than a million cars.
International Expansion
The first international sale and exhibition of Volkswagen in the United States was in 1949. However, the first year marked a slow beginning for the company because of selling few units of the vehicle. This prompted a drive to restructure the approach of the company. Volkswagen took a radical move to contract a New York Based company to manage its advertising strategy to popularize the brand and win more sales for the company. The company contracted an advertising agency named Doyle Dane Bernbach (DDB). Under the supervision of CEO William Bernbach, the advertisers created a legendary advertisement campaign that marked the historical success of Volkswagen in the United States. The copywriters, Julian Koenig, and Helmut Krone developed the famous “Think Small advert ” for the company using the backdrop image of a tiny Beetle in a white plane space. The catchphrase “Maybe we got so big because we thought small” resonated with the US market of consumers and drove the scale of the company’s sales on an unprecedented level. Forty years after the success of the ad, Ad Age named it the best advert of the century.
While the Success of Volkswagen in the United States market gained legendary status, the company continued to expand its international presence by opening up new markets in Europe, Asia, South America, and Africa. Currently, the company’s manufacturing locations are spread throughout major global destinations such as Mexico, Canada, and Ireland while still maintaining familiy ties. Volkswagen adopted a double-marketing approach to drive sales in emerging markets.. In this strategy, the company engages multiple advertising agencies and pits them against each other. This way, the adverts will run concurrently, but the campaigns did not work together. Therefore, the company achieves a double advantage of developing a stronger international brand image and showcasing different aspects of its strengths to consumers.
Volkswagen also emphasizes on making its products readily available to consumers at the point of need. Currently, Volkswagen has about 44 production plants spread across the globe to cater to all its global markets. The automotive maker has been one of the most consistent vehicle manufacturers with high sales volumes in the automotive industry, competing against global giants such as Toyota.
Generally, Volkswagen has managed to achieve the current level of growth because of an aggressive marketing strategy and an ambitious expansion policy. The company has navigated the challenges of adverse business conditions in its decades of existence but managed to emerge successful and stronger through every obstacle. Embracing modern technology in the development of the vehicle has also adapted the company to the modern market. Finally, effective brand management is critical to developing a successful business regardless of the industry that the business belongs or its form of ownership.
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Bibliography
Hiott, A., 2012. Thinking Small: The Long, Strange Trip of the Volkswagen Beetle. Ballantine Books.
Blackwelder, B., Coleman, K., Colunga-Santoyo, S., Harrison, J.S. and Wozniak, D., 2016. The Volkswagen Scandal.
Jung, K., Chilton, K. and Valero, J.N., 2017. Uncovering stakeholders in public–private relations on social media: a case study of the 2015 Volkswagen scandal. Quality & Quantity, 51(3), pp.1113-1131.
Jung, K., Chilton, K. and Valero, J.N., 2017. Uncovering stakeholders in public–private relations on social media: a case study of the 2015 Volkswagen scandal. Quality & Quantity, 51(3), pp.1113-1131.
Blackwelder, B., Coleman, K., Colunga-Santoyo, S., Harrison, J.S. and Wozniak, D., 2016. The Volkswagen Scandal.
Couch, K., Dilts, K., Ferguson, R., Fisher, L., O’Malley, S. and Uhlending, S., 2017. Volkswagen Brand Audit.