Please help with the comparison of Rolex Watches vs. Timex Watches with the following question.
(1) Describe each company's target market. Do NOT include definitions of target market or segmentation.
2) How does the choice of target market influence the company's pricing and promotion (from what you know so far)?
(3) Now imagine one of the companies you chose wants to introduce a new target market. For instance, suppose Hilton or Four Seasons wanted to offer a budget option for the target market sought by Motel 6. How would this strategy affect consumer perceptions?
(4) Do you think these customers will be influenced by changes in the economy? Why or why not? [Here you need to be logical. That's all.]
(5) Do you think these customers are influenced by social environment? For instance, do people buy these products or services in response to peer pressure? Keeping up with the Joneses (a/k/a aspirational reference groups)? Why or why not?
(6) Do product brand and store name play a role in the purchase decision? I.e., Do they buy a Coach bag because it's a Coach? or would they buy the same bag at Wal-Mart if it appeared to be the same? Would they prefer to buy this bag at a Saks Fifth Ave rather than at Joe's Discount Shop? Why do you think so?
(7) Do you think this target market shops for bargains? Or do they actually seem ready to pay a higher price? Why do you think so?
Remember the "why" is more important than the "what."
Karamchandani, Ashish, Kubzansky, Mike and Lalwani, Nishant (2011), Is The Bottom Of The Pyramid Really For You? Harvard Business Review; Mar2011, Vol. 89 Issue 3, p107-111, http://search.ebscohost.com/login.aspx?direct=true&db=bth&AN=58558717&site=ehost-live
Stevenson, Betsey. 2010. "So You Think You're Middle Class" New York Times Dec 22. http://www.nytimes.com/roomfordebate/2010/12/22/what-does-middle-class-mean-today/aspirations-not-current-income
Anonymous (2006). Wal-Mart: Is There A Downside To Going Upscale? Knowledge & Wharton. June 14. http://knowledge.wharton.upenn.edu/article.cfm?articleid=1499
How a fertilizer company used segmentation to grow profits substantially. http://www.youtube.com/watch?v=laTzwz08M94
Thanks in advance for you assistances
Running Head: TARGET MARKETS FOR ROLEX WATCHES AND TIMEX WATCHES
Comparing Target Markets for Rolex Watches and Timex Watches
Target Markets for Rolex Watches and Timex Watches
Rolex Watches, a prominent Swiss watch brand all over the world, is often esteemed for the salient high quality of the watches clearly reflected in its pricing which range from thousands of dollars to hundreds of thousands of dollars. The target markets for the Rolex Watches therefore are high end rich clientele. It is associated with clientele who want prestige and status and is symbolic of rich celebrities (Watches, 2006; Temporal Brand Consulting, 2004). This implies that the target market of Rolex includes individuals both male and females who desire luxury and self actualization and express this through watches, rather than through other luxury products such as artwork or BMW. The design, pricing, quality, features among others of the Rolex watch are made with the upper class wealthy and prestigious individuals in mind (USP, 2007), people who would want to own the watch as a master piece rather than a time telling device.
Timex Watches targets a market segment with people who desire stylish, inexpensive and durable watches. It targets the people in the population irrespective of class or social status who want to own affordable, stylish and durable watches (Timex, 2011). And so where as Timex Watches targets consumers who want to buy watches for the value of time telling and other stylish features, Rolex Watches target consumers who want to buy luxury and do so through watches.
How the choice of target market influence the company's pricing and promotion
The choice of target market clearly influences how a company promotes and charges for its products. Rolex Watches targets customers who want luxury rather than timepieces. This implies that this target market only considers a commodity a luxury if it is not easy to acquire, if it is expensive and if it brings about prestige. The positioning of Rolex as a prestigious watch implies that it also has to priced highly for the target market to see any value in the piece. Unlike Timex watches which are found in various stores that can easily be accessed by various customers, Rolex Watches are only found in High end jewelry stores or even in stand alone Rolex Stores (Grandy, 2010). They also advertise in high end consumer magazines and in televisions in a manner that exudes pride, luxury and success. The pricing and promotion methods used in this case as so as not to erode the value placed on the watch by its target customers. Developing a view synonymous with prestige and status in the consumers' mind, Rolex is able to translate this into premium pricing for its products.
If Rolex wanted to introduce a new target market
If Rolex wanted to introduce a new target market that competes directly with Timex in providing consumers with durable, affordable and stylish watches, this would greatly negatively affect consumers' perception regarding the Rolex brand. Such a strategy would erode and dilute the image of the brand in the eyes of the original target market and would therefore not appeal to ...
Rolex watches versus Timex watches comparisons are examined. How the choice of target markets influences the company's pricing and promotions are examined.