The Value Proposition of the Volkswagen Company Essay - 1

The Value Proposition of the Volkswagen Company - Essay Example This is the strategic initiative taken by the company Volkswagen to target customers (Global Strategy for Volkswagen, 2010). The company has historically bathe sed the organization on the basis of differentiation as its strategy. They bought the same product in differentiated form for a niche audience. After the global economic crisis, the company has started focusing on cost leadership so that they can provide the customer with the same product at a better price. This is done keeping in mind the economic scenario across the globe. Analysts have considered this to be a move whereby the company will hamper its brand image which is the company’s biggest asset. The management of the company believes they are not playing with the brand image they are just focusing on streamlining some costs so that they can focus the saved money on enhancing brand image and various other promotional activities for the brand Volkswagen (Volkswagen Strategies, n.d.). Brand image is the biggest asset for the company and has created what Volkswagen is today. For any normal car buyer, Volkswagen is not into the consideration state. The company’s biggest strength is its brand image which has created by forming an emotional bonding with the youth of the world. Customers of Volkswagen are brand loyal because of the perceived image of the brand. It is the emotional bonding and association with the brand which results in repeat sales from the customers. This is why relationship marketing becomes so important for Volkswagen. The whole framework of the company is based on relationship marketing (Alkhafaji, 1995). Right Relationship with right Customers-Brand Image The objective at Volkswagen has always been on having the right relationship with the right customer segment.