"Saturn Case Study"

Essay by smalldaddy October 2006

download word file, 10 pages 5.0

Situational Analysis

Saturn was created as an independent subsidiary of General Motors in order to face the rising competition in the American small car market from the Japanese companies. It was GM's first new car division since Chevrolet. This "clean sheet" approach was intended to match the Japanese car manufactures in terms of efficient manufacturing practices and employee involvement in the process. In addition to this, Saturn also aimed to develop better relationships with the dealers and the United Auto Workers Union (UAW). This new principle of management and UAW partnership would enable transparency and effective decision making.

Roger Smith and the Saturn team focused on providing a lot more than just functional value with Saturn. Apart from being technologically superior to the existing American cars in the segment and on par with the Japanese versions, it was designed to offer the amenities and styling of an expensive car at a lower price.

The built-in value proposition would be value as perceived by its buyers.

The timing of Saturn's launch also gave it a fillip, as the economy was coming out of a recession, when 'value' was considered to be everything by the American consumers and the need for an all-American car to be pitted against foreign makes, especially the Japanese was widely felt.

Saturn's value pyramid is given in exhibit 1 which highlights the value proposition it offers and the emotional connect that it maintains with the consumers.

Exhibit 2 shows the various factors that affect brand equity according to Aaker and it is clearly visible that Saturn scores high on all these parameters.

The characteristics unique to Saturn can be classified under the Customer, Competitor, Company and Context fields, as follows:


Saturn laid the most stress on customer satisfaction. They focused on the customer as an individual...