Market Segmentation of Mercedes-Benz

Inevitably, all automobile enthusiasts have their preferences. Since the industry is highly competitive, the choice becomes more difficult whenever one is introduced to the driving world. However, one thing that for sure occurs is that people trust their family members, friends, or even social media users of various channels that suggest the best cars for them to pick. One of the ultimate best automobile companies is Mercedes-Benz. Their automobiles are renowned for their luxury, power, and construction standards. To satisfy consumer needs, the business offers a variety of models at various pricing points. Let’s discuss the company. 

Segmentation Strategy of Mercedes-Benz

To discuss the Mercedes-Benz segmentation strategy, we are going to take a look at the commercial below.

Well, what a horror story, right? 

This video is advertising the Mercedes-Benz E-Class W212. It simply shows a man driving through the freezy winter; thus, his attention is definitely enhanced.

Then we see the death character warning the guy that the end is near. However, right as danger is supposed to strike, the car’s breaks instantly do their magic.

Hence, as Death apologized in advance, the guy apologized for the latter’s failed mission.

The biggest hint here is that the character in this video gets the benefit of the doubt. All ends up well for him, even though there is a danger that things could go wrong.

And secondly, he is open to challenges. Even though he gets frightened when encountering Death, he keeps driving.

And with those hints, the Mercedes-Benz target segment is Balancers.

Lifestyle and values:

Balancers tend to be positive individuals who see the positive side of everything. 

This segment appreciates working and learning new things since it improves their quality of life. However, they regret doing it. They do not spend as much time with their families when working.

Even when they are with friends, Balancers feel guilty since it again takes time away from their families. 

It should be clear by now that Balancers value their family. They put in a lot of effort to support their family. Consequently, the need for work cannot be avoided. 

Balancers occasionally ignore new difficulties even when they are open to them. They desire to advance in their occupations. 

They are aware of the possible repercussions of their attitude toward their family. As a result, Balancers try to keep a healthy work-life balance.

This segment shines both as an individual contributor and as a part of a team. 

Balancers are always trying to improve the world. They enjoy giving to organizations that care about society. 

This segment places a lot of attention on relationships. Although they might be socially active when they are young, once they have children, they completely change. 

Balancers are devoted and maintain long-term, committed relationships.

Attitude towards shopping:

Ads need to be exciting and entertaining for this segment. 

When Balancers are knowledgeable enough to judge a new business as worthwhile, they purchase from them.

Balancers place the most incredible value on the products’ quality when they shop. Discounts and sales, however, are unquestionably advantageous.

Balancers are loyal clients who frequently stick with the companies they enjoy. 

On average, they go grocery shopping with family once a week. Because they prefer eating healthily, balancers benefit from food discounts. 

Other interesting facts: 

Balancers

• Mostly choose their hobbies to surround family time, such as outdoor activities
• Exercise a lot because they are prone to a healthy lifestyle
• Enjoy calming activities, such as reading books and watching movies
• Mostly consume traditional TV
• Utilize the internet frequently for multiple reasons 
• Have always to be informed about the things going on in the world 

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Positioning Plan of Mercedes-Benz

Mercedes-Benz was previously just a Daimler AG consumer-focused brand. In February 2022, when Daimler AG changed its name to Mercedes-Benz Group AG, it became a corporate brand. The company is “one of the world’s most successful automotive companies.” It establishes its strategic domain similarly to BMW, focusing on sustainable luxury and mobility while paying particular attention to the creation of electric vehicles and proprietary automotive software.

High-end consumers are the primary target market for the Mercedes-Benz consumer brand. It is promised that the best products will be made with the utmost accuracy and focus on the tiniest details. Mercedes is more focused on the opulent lifestyle for the top class, whereas BMW is more concerned with the optimum driving experience. Mercedes is strongly associated with comfort, whereas BMW is heavily connected with performance. 

“The best or nothing” has been Mercedes-Benz’s brand motto for many years. The company takes part in several initiatives that promote associations with an extravagant lifestyle and reinforce this positioning. Consider the company’s involvement in high-fashion events, “Mercedes Me” magazine, or “She’s Mercedes” – a website dedicated to empowering women — as examples.

The premium German manufacturer Mercedes-Benz announced that it had developed a new strategy plan designed to focus on profitable growth with its future models and aim at leadership for the company’s electric drive and car software.

They want to design the world’s most coveted automobiles. Utilizing its advantages as a luxury brand will enable them to improve its product portfolio mix and placement while raising its financial value. 

They realize the full potential of their distinctive sub-brands, including AMG®, Maybach, G, and EQ, according to Ola Källenius. The latter is the Chairman of the Board of Management of Daimler AG and Mercedes Benz AG.

In reaction to Mercedes-Benz’s announcement of a new strategy, Källenius made the following claim. With this new approach, they are making it clear that they are dedicated to fully electrifying their product range. They are determined to make the company carbon-neutral, aligning with their Ambition 2039 aim.

The company’s top priorities are thinking and acting like a premium brand. This part can sound confusing because Mercedes-Benz is already recognized as a luxury brand. However, this strategy requires a more aggressive drive toward luxury in their products, client interactions, and digital technology.

The automaker’s comprehensive strategy revamp includes the product lineup, brand marketing, and sales network. These components are intended to provide what the company describes as a luxurious experience that is “electric, software-driven, and sustainable.”

The company will then focus on enhancing and redefining its marketing strategy. This entails prioritizing balancing volume, pricing, and channel mix to assure more substantial contribution margins from Mercedes-Benz’s current and future portfolios. 

The premium brand will focus its resources and money on the markets and market segments it believes will produce the highest revenue to assert higher profitability further.

Mercedes-Benz is currently the most valuable luxury brand globally, according to Interbrand, a marketing firm with headquarters in New York, and they want to keep it that way. The new strategy uses their “extraordinary” sub-brands, such as AMG®, Maybach, G, and EQ, to do this and ensure that these vehicles perform to their full potential.

Starting with AMG’s ambitions for high-performance electrification, which will begin by 2021, the company aims to step it up. It also collaborates with Formula 1, whose reach will increase the following year, to support its position as a high-performance sub-brand.

The Mercedes Maybach almost-limousine will then double in size to appeal to potential buyers worldwide by hopping on the electric train. The legendary G-Class will follow suit. 

Finally, under the EQ brand, the firm will provide its consumers with cutting-edge, high-tech automobiles with electric designs.

Along with striving to boost sales and performance with its revamped selection, the company is committed to creating lasting relationships with its clients. 

Mercedes-Benz will work to quickly increase repeat business, customer loyalty, and recurring revenue. 

These sources of revenue will mostly come from subscription services, Over-the-Air (OTA) upgrades, and service and part sales. By 2025, the Mercedes Benz fleet will have 20 million fully linked vehicles, so the growing connected car market will offer up-and-coming revenue opportunities. The automaker made this statement in a press release.

It should be clear now that Mercedes is actively promoting electric vehicles. The manufacturer wants to dominate the EV industry through “ambitious product development targets and the accelerated introduction of cutting-edge technology.” 

As part of its “Electric First” strategy, the company stated that four new EVs would be built on its next large-car Electric Vehicle Architecture or EVA. This lineup will include the much anticipated EQS sedan, EQS, EQE, EQS SUV, and the EQE SUV.

By the start of 2025, even more, electric vehicle types will be added to the Mercedes Benz Modular Architecture, a new platform.

In addition to finishing the necessary preparations for the company’s future and moving quickly to an electric portfolio, the German manufacturer wants to increase its profitability and cash flow. The corporation claims that “2020’s events have confirmed that the break-even point is too high for the company and, with the transformational challenges ahead, further actions will be required.” Because of this, “Mercedes Benz will take significant new steps to reduce the cost base and improve the industrial footprint up to 2025.”

Last, Mercedes-Benz wants to aim for a return on sales (RoS) level in the mid to high single-digit range by 2025 despite difficult marketing conditions. In reality, the firm hopes to achieve a double-digit profit in a favorable market environment.

The foundation of their new strategy is their highly motivated and competent personnel. Everyone at Mercedes Benz is dedicated to achieving their objectives. They will design the world’s most sought-after automobiles. That is what they want to achieve and offer to their customers. 

There will be a giant leap in technology. Mercedes-Benz will develop more wisely, change its industrial footprint, and invest where they stand to profit. 

The Mercedes-Benz Marketing Mix

Before getting into it, let us understand the marketing mix. The latter discusses a company’s product, price, place, and promotion strategies. As you might notice, all those begin with the letter “P”; hence, marketing specialists also refer to the marketing mix as the 4Ps strategy.

Now, let us look at them one by one.

Product: 

One of the best premium vehicle manufacturers in the world is Mercedes-Benz. Mercedes’ product portfolio is one of its most vital features. As part of its marketing mix product strategy, Mercedes-Benz provides a variety of passenger automobiles, light commercial vehicles, and heavy equipment vehicles. 

However, the luxury vehicle market, including sedans, SUVs, and sports cars, will have the broadest range of its products. The new generation section includes the A, B, and CLA models. The E-class, C-class, and S-class are available in the sedan. Mercedes-Benz manufactures a variety of cabriolets and roadsters in addition to the SUVs GLA, GLE, GLC, and GLS.

Additionally, the Mercedes Maybach S Class is the height of luxury in and of itself. Mercedes may be pleased with their vehicles because they offer the best luxury, technology, and design. Two of the best technologies on the market are 4matic and BlueTEC. Mercedes also deals with used and brand-new vehicles through its Mercedes Benz Certified portfolio. By 2022, the business wants to push electric and hybrid automobiles with an expenditure of $11 billion.

Price:

A premier manufacturer of premium vehicles is Mercedes Benz. Its pricing is always on the higher side due to its position in the luxury market and the desire of its target clientele for quality over quantity.

Prices range from $30,000 to $100,000 and are more outstanding on the foreign market, where Mercedes Benz offers many items. It makes considerable investments in expensive materials because it primarily targets the demand for luxury automobiles. 

Mercedes-Benz’s pricing strategy for its marketing mix is premium pricing in light of its attributes and the market.

Place:

Vehicles made by Mercedes-Benz are sold all over the world. Mercedes offers services in a wide range of nations across the globe thanks to its dealerships and service centers. The major markets are China, the Asia-Pacific area, Europe, Germany, North America, and others. The company’s widespread presence demonstrates the success of Mercedes Benz’s positioning and distribution strategy within the marketing mix. 

The largest towns and metropolises on earth are home to hundreds of Mercedes dealerships. Asia, North America, South America, Africa, Europe, and other continents are just a few places where it operates facilities and plants.

Germany, South Africa, India, France, Brazil, the United States, and Hungary all have Mercedes factories.

Promotion:

Mercedes Benz has always made aggressive self-promotion. All media outlets, including TV, print, the web, billboards, etc., are utilized by Mercedes-Benz as part of its marketing mix promotional strategy. Because Mercedes served the elite market, it did not see the need for the typical kinds of advertising. 

Mercedes’ marketing strategy has always been focused on its products, technology, etc. Still, as times and customer attitudes have evolved, it has also turned to online marketing, social media presence, print media, etc., to enhance connection with customers worldwide. 

Through a range of customer-focused initiatives, including the Mercedes Trophy, an international amateur golf competition in which golfers worldwide participate, Mercedes has also raised brand recognition.

It also provides a variety of drives, like the Luxe Drive and the International Driving Platform, allowing auto aficionados to steer Mercedes vehicles through challenging terrain. 

And with that being said, please remember to stop by our main website as we constantly develop new content regarding well-known companies to analyze their marketing strategies.