Saturn: an Image Makeover

Saturn: An Image Makeover

Synopsis

This case chronicles the successful history of Saturn as a company narrowly focused on a single line of compact cars. Some attempts the company has made to differentiate into other market segments have not exactly been successful. In most recent years, Saturn’s financial performance has suffered. However, executives at GM are intent on changing that. Saturn is poised to launch an entirely new vehicle lineup, including a compact, a mid-sized sport sedan, an eight-passenger crossover SUV, a hybrid SUV, and a two-seat roadster. A $3 billion investment in Saturn clearly illustrates the confidence that GM has in its newest division, especially given that it is one of the smallest GM brands. GM hopes to take sales from 215,000 in 2005 to 500,000 by 2010.

With all the new models, some question whether Saturn will maintain its image as the United States’ lone “Asian” brand and a socially responsible company. Some industry insiders are confused about the segment that Saturn is trying to target.

Discussion Questions

1. Using the full spectrum of segmentation variables, describe how GM has segmented the automobile market.

Given the information in the case, this may be challenging. Students will have to call upon their external perceptions to create a more complete profile of the “old” Saturn’s customer profile. They are likely to come up with general conclusions rather than specific. But a profile should emerge, nonetheless.

Here are some suggestions:

Demographic:

• Age—younger than the average GM buyer. Most typically college age on through early 40s.

• Gender—fairly evenly split.

• Family life cycle—young marrieds with and without children are certainly among Saturn’s early target market. However, young to middle-age singles are also prevalent. Some customers may exist in other categories (the image of an SL1 being towed behind a motor home with a retired...