Marketing Strategy FOR Ducati PDF

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MARKETING STRATEGY FOR DUCATI MARKETING MANAGEMENT EIB 10803

NAME: MUHAMMAD HAZIQ AIMAN BIN ROSLAN ID NUMBER: 62212219295 CLASS: M10 LECTURER NAME: MOHD FARID SHAHSUDIN SUBMITION DATE: 19 AUGUST 2019

TABLE OF CONTENT

ABSTRACT ……………………………………………..………….…………………...3 1.0 INTRODUCTION ABOUT DUCATI………………………...……………………..4 1.1 BACKGROUND FOUNDER OF DUCATI………………………………...……..5 2.0 PRODUCT OF DUCATI……………………………………………..………………6 2.1 PRICE OF DUCATI…………………………………….…………………………7 2.2 PLACE OF DUCATI………………………………………………………………8 2.3 PROMOTION OF DUCATI……………………………………………………….9 2.4 MOTOCYCLE DESIGNS OF DUCATI…………………….……………………10 3.0 CONCLUSION……………………………………………………………………….11

ABSTRACT

Marketing strategy of Ducati analyses the brand and company which covers 4Ps (Product, Price, Place, Promotion) and explains the Ducati marketing strategy. The Ducati elaborates the pricing, advertising & distribution strategies used by the company. Ducati is an Italian motorcycle manufacturer known for sport bikes and street bikes using L-Twin engines. The Ducati company was founded in 1926 in the northern Italian town of Bologna, but motorcycles were not being produced in the Borgo Panigale plant, with the firm producing radio equipment. The company’s Italian holdings were decimated during World War II bombings and like other famous European marques, Ducati rose out of the ashes to its current stature. Ducati motorcycle production began post-war first as motors attached to bicycles. In the early '50s the firm was producing stand-along motor scooters, but by the end of the decade Ducati was making its name in the racing world. Much credit for its racing ascension is given by Ducati to engineer Fabio Taglioni, who developed Ducati’s desmodromic valve system. Taglioni’s work included the creation of many successful Ducati Singles as well as the Ducati 250 Twin raced by English legend Mike Hailwood. The ‘60s and ‘70s saw racing success for Ducati, building the Italian firm’s prestige as a racing marque. Racing highlights include: a 1972 win by Paul Smart in the Imola 200 with a desmodromic 750 Twin and the 1978 Isle of Man TT triumph of Mike Hailwood, who came out of retirement to race the 900cc Supersport Twin. Ducati was purchased in 1983 by the Castiglioni family and merged with the Cagiva Group. Again the marque found success on the racetrack, with further progression of its Twin-powered sportbike platform in the form of its 851 and 916 Superbikes. Highlights of the Castiglioni years include the introduction of its wildly popular Monster line – a naked street bike designed by Argentine designer Miguel Galluzzi. Economic woes saw Ducati ownership change hands in the mid-'90s to the American investment firm of Texas Pacific Group. The Superbike and Monster lines continued, with Ducati finding even more racing success in the World Superbike Series at the hands of Carl Fogarty. Troy Bayliss, Neil Hodgson and James Toseland extended Ducati’s dominance in the World Superbike Series into the new millennium. Ducati also pushed ahead into Grand Prix, with the V-Four Desmosedici leading its MotoGP effort. The 2003 entry paid dividends in 2007, when Australian Casey Stoner claimed the GP title. Off the track, Ducati expanded its sales line. The Ducati 916 evolved to the controversially-styled 999, then the 1098 and now the current 1198. A high-spec 1098R is Ducati’s Superbike racer, sporting production traction control. Ducati’s middleweight sportbike bumped up from the 749 to the 848. But the most impressive Ducati sportbike remains the Desmosedici RR, a production version of the firm’s GP racer.

1.0 INTRODUCTION ABOUT DUCATI

Ducati New Logo Start From 2008-Present

Parallelly a small firm SIATA (Società Italiana per Applicazioni Tecniche Auto-Aviatorie) based out of Turin was developing small pushrod engines, ready-made to be mounted on bicycles. Post Italy’s liberation in 1944, SIATA started selling the ready-made engines (they called it the Cucciolo, Italian for puppy). The first batch of customers for this little Cucciolo engines where bicycle owners/enthusiasts who wanted to give this new product a try. It took some time for automobile entrepreneurs to buy into the product. Soon motorized bicycles were up for sale. In 1950, after more than 200,000 Cucciolos had been sold, in collaboration with SIATA, the Ducati firm finally offered its own Cucciolo-based motorcycle. This first Ducati motorcycle was a 48 cc bike weighing 98 pounds (44 kg), with a top speed of 40 mph (64 km/h), and had a 15 mm carburetor (0.59-inch) giving just under 200 mpg-US (1.2 L/100 km; 240 mpg-imp). Ducati soon dropped the Cucciolo name in favor of “55M” and “65TL”. By now, the Italian motorcycle market was gearing towards larger motorcycles. However, Ducati remained true to their philosophy of making small engines introduced their 65TS motor scooter in the 1952 Milan auto show. This piece of design and engineering was described as “an interesting machine”. However, it didn’t make a dent in the mass market as only a few thousand were made before the model ceased production. This debacle in the 1950s led to Ducati being split into two entities Ducati Meccanica SpA and Ducati Elettronica, in acknowledgment of its diverging motorcycle and electronics product lines. Ducati Elettronica became Ducati Energia SpA in the eighties. Dr. Giuseppe Montano took over as head of Ducati Meccanica SpA and the Borgo Panigale factory was modernized with government assistance. By 1954, Ducati Meccanica SpA had increased production to 120 bikes a day.

1.1 BACKGROUND FOUNDER OF DUCATI

Ducati Old Logo start from 1997-2008

Since 1926, Ducati has been owned by a number of groups and companies. 1926–1950 – Ducati family 1950–1967 – Government Istituto per la Ricostruzione Industriale (IRI) management 1967–1978 – Government EFIM management (control over day-to-day factory operations) 1967–1973 – Headed By Giuseppe Montano 1973–1978 – Headed by Cristiano de Eccher 1978–1985 – VM Group 1985–1996 – Cagiva Group 1996–2005 – Texas-Pacific Group (US-based) ownership and going public Headed by CEO Federico Minoli, 1996–2001; returning for 2003–2007 2005–2008 – Investindustrial Holdings S.p.A. 2008–2012 – Performance Motorcycles S.p.A. An investment vehicle formed by Investindustrial Holdings, BS Investimenti and Hospitals of Ontario Pension Plan 19 July 2012 – present – Automobili Lamborghini S.p.A. AUDI AG acquired 100% of the voting rights of Ducati Motor Holding S.p.A. via Audi's Automobili Lamborghini S.p.A. subsidiary. From the 1960s to the 1990s, the Spanish company MotoTrans licensed Ducati engines and produced motorcycles that, although they incorporated subtle differences, were clearly Ducati-derived. MotoTrans's most notable machine was the 250 cc 24 Horas (Spanish for "24 hours").

2.0 PRODUCT OF DUCATI

Ducati is a global manufacturer of sports bikes, which are known for their speed and performance. At the time of inception Ducati uses to produce radio components like vacuum tubes, condensers, and other various components and after that, the company came up with a cycle with an engine having an overall weight of 44kgs, which was the first ever motorcycle produced by the company. They tried their hands in four-stroke scooters named cruiser, but it was not successful. Since then the company started with high-end manufacturing motorcycles as a part of their marketing mix product strategy. Now, Ducati offers eight products in its product line that are Diavel, Xdiavel, Hypermotard, Monster Multistrada, Panigale, Supersport, and Scrambler. The description of some of the bikes are as follows: Diavel: This model has three varieties that are standard Diavel, Diavel Carbon, and Diavel Diesel. The various features of this category are: Power- 112 kW, Torque- 123Nm, Seat Height-770mm, Safety- ABS, DTC Monster: It has a huge product depth in this product line. It consists of six models in total with different power, torque and seat height. For example Monster 797+ Power-54kW, Torque- 67Nm, Seat Height- 805m, Safety- ABS The company provides various lifestyle products, accessories associated with bikes and having the logo and design of Ducati.

2.1 PRICE OF DUCATI

Below is the pricing strategy in Ducati marketing strategy: Ducati is a premium motorcycle brand offering powerful and high-performance bikes. The pricing strategy in its marketing mix is dependent upon the product as well as the valueadded services. Since Ducati is a renowned international brand, it has to consider all the factors before deciding the price of any product. Ducati is not only known for its premium and high-end bikes but also for its quality and services. The price of Ducati’s bike is a little bit on the higher side as compared to its competitors such as Suzuki and Honda. The company follows premium and value-added pricing policies. Since Ducati offers premium bikes, customers from all around the world purchase it because of the quality bikes it offers, and Ducati’s bikes are considered a status or symbol for upper-middle class and upper-class customers. Its sales have been increasing day by day across the world; this shows that customers are looking for a perfect match between quality and looks that is provided by Ducati. In addition, prices for Ducati are much lower than those of other leading brands internationally and in Malaysia, Ducati also has much superior technological and safety strengths than other high-powered motorcycle brands. It also contributes to the community considering buying products from the Ducati brand because of the low price of other brands and the high level of safety and technology for their motorcycles. This has made the Ducati brand more prominent in Malaysia and internationally.

2.2 PLACE OF DUCATI

Ducati is present all over the world covering most of the countries. Japan, Europe, UK and the US are the primary markets for its products. It has subsidiaries in various countries which help the company in building the strong distribution network. The firm has strategized its distribution network by having a strong alliance with dealers and distributors. Later the company opened its chain of outlets to show the visibilities across the world and started providing world-class service to its customers. They opened many service centers to fulfil the after-sales services to the customers. Ducati has positioned itself very well in the market by providing robust infrastructure and distribution network that includes dealership programme. Dealership programme is the most effective platform which consists of forty outlets exclusive for its products and the company also provides the proper training of the employee.

Ducati's placement in Malaysia has had a huge impact on Malaysians because of its trusted brand and has given their buyers satisfaction with the strength and durability of their goods. It has also given them great promotions and on a large scale by the way they provide Ducati vehicles to anyone who heads the Ducati brand of motorcycle clubs. In addition, Ducati has also taken Malaysian artists as Ambassadors for their products as for example Zizan Razak has been Ambassador for Ducati products for Panigale.

2.3 PROMOTION OF DUCATI

The promotional and advertising strategy in the Ducati marketing strategy is as follows: Ducati has a confident and robust image among the target segments. It has been associated with many promotional activities over the years. The promotional activities include both offline and online campaigns. In offline promotions, the company uses to come up with various advertisements and commercials that define the brand value of the company and help in the propagation of its products to the maximum benefits for the company. The company launched many YouTube ads to gain the focus of the youth, and for direct interaction with the customers, it has a Facebook page. Ducati is associated with various sports events and competitions such as AMA Superbike Championships, Manufacturer World Championship, MotoGP, etc. Ducati has its team named Ducati Corse which is the racing team department that participates in mentioned above racing competitions. For example, In 2007, Ducati won MotoGP World Championship for both manufacturer and rider. So, the association of the company with all these events positions the products as rough and racing bikes among the target segments. This concludes the Ducati marketing mix.

2.4 MOTOCYCLE DESIGNS OF DUCATI

Ducati is best known for high-performance motorcycles characterized by largecapacity four-stroke, 90° V-twin engines, with a desmodromic valve design.Ducati refers to this configuration as L-twin because one cylinder is vertical while the other is horizontal, making it look like a letter "L". Modern Ducatis remain among the dominant performance motorcycles available today partly because of the desmodromic valve design, which is nearing its 50th year of use. Desmodromic valves are closed with a separate, dedicated cam lobe and lifter instead of the conventional valve springs used in most internal combustion engines in consumer vehicles. This allows the cams to have a more radical profile, thus opening and closing the valves more quickly without the risk of valve-float, which causes a loss of power that is likely when using a "passive" closing mechanism under the same conditions. While most other manufacturers use wet clutches (with the spinning parts bathed in oil)Ducati previously used multiplate dry clutches in many of their motorcycles. The dry clutch eliminates the power loss from oil viscosity drag on the engine, even though the engagement may not be as smooth as the oil-bath versions, but the clutch plates can wear more rapidly. Ducati has converted to wet clutches across their current product lines. Ducati also extensively uses a trellis frame, although Ducati's MotoGP project broke with this tradition by introducing a revolutionary carbon fibre frame for the Ducati Desmosedici GP9.

3.0 CONCLUSION

In conclusion, we can see that marketing strategies for Ducati have had a great impact on Malaysians because of their strong product development and they have also produced durable and affordable products. Ducati has also produced high-powered motorcycle designs that are of interest to all users of this high powered motorcycle. Thus we can see that every motorcycle design has its own dynamic design and futuristic. Ducati has also manufactured high quality products and technology and safety features for each of their motorcycles and this gives consumers the opportunity to choose their products as the leading brand in purchasing a powerful motorcycle....