Segmentation
Geographic Segmentation
Geographic market segmentation involves Rivian R1S targeting its customers based on their locations. The company has been producing first-class electric cars that help it beat companies like Tesla in the market. The efficiency and effectiveness of Rivian R1S products have made it gain completion in both the US and other developed countries such as the UK, Australia, and Japan. Therefore, based on the geographic market segmentation, Rivian can do domestic supply with the USA and do exports to other developed nations such as the UK, Japan, and Australia.
Demographic Segmentation
Rivian R1S should also focus on using a demographic market segmentation approach to identify its audience for the R1S vehicle. The vehicles being produced by Rivian are expensive and with high standards. The company has invested in making new brands based on the new technology. The expensive and luxurious R1S vehicles make the company target people with a steady flow of income. The age bracket for this market segment is made up of people aged between 45 and 55 years.
Levels of Segmentation
Mass Marketing
Rivian’s main product is R1S, a prime brand in the automotive industry. Mass marketing can be defined as the strategy whereby the company ignores market segment differences and appeals to the market with one offer. With reference to the market segmentation of Rivian, some common features comprise people with a high level of income, high social class, and who live luxurious lives (Kotler et al., 2016). Despite having different market segments for the Rivian R1S, it could be essential to focus on providing one product to the market at a go.
Single Segment Specialization
Single-segment concentration is done when the company selects a single segment to concentrate on and sell its product. In this case, Rivian can focus on the market segment of people with high incomes who live luxurious lives. The study shows that it took Rivian more than ten years to develop the R1S model. The R1S model is designed for family people who use it to go on trips. It will be a waste of resources if Rivian starts to target different market segments, which may, in the end, not buy the product.
The Detailed Product Life Cycle Stage for Electric Vehicles
The product lifecycle for electric vehicles has five stages: product development, introduction to the market, growth, maturity, and product decline. At the development stage, the company researches the market demand and evaluates its capabilities to determine whether it can meet the customers’ needs (Kotler et al., 2016). At this stage, intensive research is conducted to establish the presence of the customers and how to get resources.
Introduction
The new electric car model is introduced to the market at the introduction stage. At this point, the product prices are relatively low and fair to attract more customers. There is no proper positioning as the company tries to conduct market segmentation based on the level of income, geography, and behaviors of the customers. However, promotions are done through advertisements to attract more customers.
Growth
After introducing new electric cars to the market, the growth stage manifests with a rapid increase in sales. The prices of electric cars are then standardized to ensure that the company generates profits to the company (Kotler et al., 2016). At this stage, the electric car’s brand image, for example, R1S, starts to go global through product development and advertisements. Possible distribution channels and positions are determined through market segmentation, such as geography, behaviors, psychology, and demographics.
Maturity
The new electric car brand reaches a maturity level when it has created a brand image for the company in the market. This is the stage where the brand controls the price, as the customers cannot dictate it. The company gains more competitive power than its rivals by having a good brand in society. At the maturity stage, the brand for the electric cars will have a specific market segment loyal to the company’s products.
Decline
Due to new entrants into the market, the electric car will be subjected to stiff competition, hence its decline. The competitors will come in with superior brands, forcing the existing company to reduce its prices. Most of the profitable outlets for the brand stop promoting the company, reducing profits and sales. However, there is a need for a minimal level of product promotion to retain the remaining few customers.
Innovative Characteristics
Relative Advantage
Relative advantage is one factor that will help Rivian’s company grow. There is a need for the company to undertake a series of innovations on the existing product and come out with a new electric car that is superior to R1S (Connor et al., 2019). There is the risk of other companies coming up with more classic brands than R1S. Therefore, to maintain a good brand image in the industry, Rivian will have to rebrand its product to gain a large market share.
Compatibility
The technology used by the company to innovate the new product should be compatible with the existing brand. Rivian should ensure that its innovations on the brand are consistent with the current product to the extent that the new generation can apply it (Kotler et al., 2016). A more compatible new automobile for Rivian will give the users a good time when transitioning to the new model (Connor et al., 2019b). Furthermore, the engineers will also be able to produce excellent designs without struggling.
References
Connor, A. M., Tsafnat, G., Thomas, J., Glasziou, P., Gilbert, S. B., & Hutton, B. (2019). A question of trust: can we build an evidence base to gain trust in systematic review automation technologies? Systematic Reviews, 8(1). Web.
Kotler, P., Keller, K., Columbus, B., New, I., San, Y., Cape, F., Dubai, T., Madrid, L., Munich, M., Montreal, P., Delhi, T., Sao, M., Sydney, P., Kong, H., Singapore, S., & Tokyo, T. (2016). A FRAMEWORK FOR MARKETING MANAGEMENT Sixth Edition Global Edition Introduction to Marketing Management 25. Web.