Branding strategies

Renault

First, let’s take a look to Renault sub-Brands.

Motorsports

The automaker Renault gained notoriety by the impressive winning results obtained while participating in its city to city race in the early 20th century.  By 1975 and after years and continuous success, the company decided to create its own sporting event and division named “Renault Sports”.  It was born  after the merging of “Alpine Sports” and “Gordini 1” and since this inception, Renault Sport sponsored various sporting events such as F1 racing and Rallies.

On 2011, the brand is refocusing on the better development or improving of engines for the F1 series. It’s one of the reason why Renault name is synonym with the of World Manufacturer’s Championship title won by Red Bull in 2010, 2011, 2012 and 2013 — In fact, the entire fleet of Red Bull vehicles uses Renault engines.

Further, the entire fleet of new Formula E championship vehicles are also made of Renault vehicles. This new championship focuses on harnessing powers of electric engines rather than the original internal combustion engines.

Dacia

One of the most remarkable strategies of Renault was the creation of Dacia. Financial figures shows the importance of brand for the company : 30% of the overall sales generated by the company is due to this subsidiary.  Dacia produces ‘low price range’ vehicles that can easily satisfy the needs and wants of general consumers found in developing countries.

New project

Future projects by Renault include the launching of  sports car and luxury sub-brands. The Bloomberg website reports that the automaker main goal with this strategy is of counteract the the multi-brand structure of Volkswagen Group.  In fact, Volkswagen owns several luxury brands like Porsche, Bugatti and Lamborghini.

The merging with the Japanese automaker “Nissan” has proved useful for the Asian car maker. With the tandem work by the two companies, Nissan developed a strategy that ultimately led to the launching of “Infinity”, a premium sub-brand brand that has brought wonderful results for the company. The main objective behind this creation was gaining a stronghold in the premium automotive segment.

Further, in the 1960’s, the company and Alpine had signed a partnership which allow Renault to sell the Alpine brand in its own dealership. However, poor results forced Renault to slowly fade the partnership in the 90’s. Business opportunities and economic events made Renault to re-think their strategies and nowadays, are once again, looking to re-launch the Alpine brand. The new thinking behind this change is that Alpine will re- positioned as prestigious brand for the company and thus hoping to contribute to development of the portfolio of Renault-Nissan.

Another development  of Renault is the launch of “Initial Paris”, a sub-brand for premium vehicles segment with company badge. The lineup was introduced in Frankfurt auto expo 2013 and is currently in development for several car platforms. The special edition of Renault Clio was recently introduced, bringing the “Initial Paris” cars to market. The strategy marks attempt of Renault to shift upwards in the market, possibly gaining new niches in premium segments.

Volkswagen

Motorsports

Recently Volkswagen brand clinches its second consecutive World Rally Championship. With its Polo R WRC driven by Sebastien Ogier, the German automaker won ten out of the thirteen races of the World Rally championship. It’s the second consecutive title for Volkswagen in this competition.

Sub-Brands

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By looking the assortment of brands in its portfolio,  we can observe that the Volkswagen group is comprise of several consumer car brands. With this multi-brand structure the company has a great share of the car market. However, many of the brands that form part of this portfolio are luxurious brands (Bentley, Lamborghini, Porsche…). That this mean that the German automaker doesn’t have a budget brand like Dacia for Renault? If it is so, it will really be a shame for a company like Volkswagen. It is well known that the entry level price tags on cars are performing with fabulous results in terms of sales around the world.

To address this ‘glitch’, Volkswagen is planning to launch its own and new low-cost car destined to the Chinese market. With a starting price tag of 6000€” the German is planning to build these cars in China or India, where partnerships already existing. The company boss, Dr Heinz-Jakob Neusser, mentioned that decision will be taken in the next one year and if the answer is yes, the plan will take at least 3 years. Originally this new brand won’t carry the VW logo, but that could change.

Another strategic plan of Volkswagen is the re-positioning of the Beetle model in a sub-brand category. Due to excellent sales results (120, 000 cars in 2013), the automaker is seeing it like a perfect opportunity to profit of the ‘cult’ image associated with this particular model. So, the plan is to further develop the Beetle (VW Bully = family car, Beetle Coupe = Sportive car)

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edited by Roman Ayala

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