Case Study : Porsche Guarding the Old While Bringing in the New

Porsche (pronounced Porsh-uh) is a unique company. It has always been a niche brand that makes cars for a small and distinctive segment of automobile buyers. In 2009, Porsche sold only 27,717 cars in the five models it sells in the United States. Honda sold about 10 times that many Accords alone. But Porsche owners are as rare as their vehicles. For that reason, top managers at Porsche spend a great deal of time thinking about customers. They want to know who their customers are, what they think, and how they feel. They want to know why they buy a Porsche rather then a Jaguar, a Ferrari, or a big Mercedes coupe. These are challenging questions to answer; even Porsche owners themselves don?t know exactly what motivates their buying. But given Porsche?s low volume and the increasingly fragmented auto market, it is imperative that management understands its customers and what gets their motors running



THE PROFILE OF A PORSCHE OWNER
Porsche was founded in 1931 by Ferdinand Porsche, the man credited for designing the original Volkswagen Beetle?Adolf Hitler?s ?people?s car? and one of the most successful car designs of all time. For most of its first two decades, the company built Volkswagen Beetles for German citizens and tanks and Beetles for the military. As Porsche AG began to sell cars under its own nameplate in the 1950s and 1960s, a few constants developed. The company sold very few models, creating an image of exclusivity. Those models had a rounded, bubble shape that had its roots in the original Beetle but evolved into something more Porsche-like with the world famous 356 and 911 models. Finally, Porsche?s automobiles featured air-cooled four- and six-cylinder ?boxer? motors (cylinders in an opposed configuration) in the rear of the car. This gave the cars a unique and often dangerous characteristic?a tendency for the rear end to swing out when cornering hard. That?s one of the reasons that Porsche owners were drawn to them. They were challenging to drive, which kept most people away.
Since its early days, Porsche has appealed to a very narrow segment of financially successful people. These are achievers who see themselves as entrepreneurial, even if they work for a corporation. They set very high goals for themselves and then work doggedly to meet them. And they expect no less from the clothes they wear, the restaurants they go to, or the cars they drive. These individuals see themselves not as a part of the regular world but as exceptions to it. They buy Porsches because the car mirrors their self-image; it stands for the things owners like to see in themselves and their lives.
Most of us buy what Porsche executives call utility vehicles.
That is, we buy cars primarily to go to work, transport children, and run errands. Because we use our cars to accomplish these daily tasks, we base buying decisions on features such as price, size, fuel economy, and other practical considerations. But Porsche is more than a utility car. Its owners see it as a car to be enjoyed, not just used. Most Porsche buyers are not moved by information but by feelings. A Porsche is like a piece of clothing?something the owner ?wears? and is seen in. They develop a personal relationship with their cars, one that has more to do with the way the car sounds, vibrates, and feels, rather than the how many cup holders it has or how much cargo it can hold in the trunk. They admire their Porsche because it is a competent performance machine without being flashy or phony.
People buy Porsches because they enjoy driving. If all they needed was something to get them from point A to point B, they could find something much less expensive. And while many Porsche owners are car enthusiasts, some of them are not. One successful businesswoman and owner of a high-end Porsche said, ?When I drive this car to the high school to pick up my daughter, I end up with five youngsters in the car. If I drive any other car, I can?t even find her; she doesn?t want to come home.?


FROM NICHE TO NUMEROUS
For its first few decades, Porsche AG lived by the philosophy of Ferry Porsche, Ferdinand?s son. Ferry created the Porsche 356 because no one else made a car like he wanted.