Flying Car
Question
| You have been approached by the makers of the Personal Flying Car. The Personal Flying Car is an innovative product that allows private individuals to transport themselves via this new technology. This product has not yet been developed. The executive team is awaiting your expertise and direction before developing the prototype. You have been tasked with the following: Provide a detailed profile of the potential target market including demographics, psychographics, geographics & behavioralistic segments. Develop a PEST analysis. Develop a SWOT analysis. Identify the direct & indirect competitors of the Personal Flying Car and provide background on each (price points, features, strengths, weaknesses, etc.). Forecast at least 3 potential problem areas/activities that could hinder market penetration. The makers of the Personal Flying Car are quite demanding and are requiring that your company submit a detailed written report by their deadline in order to be considered for this marketing project. |
Answer
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Contents
Profile of the Potential Target Market. 2
Direct and Indirect Competitors of the Personal Flying Car. 5
Three Problematic Areas That Could Hinder Market Penetration. 6
Introduction
The aim of this report is to provide insight and expertise on the development of the prototype for a flying car. The report is divided into five areas. The first one provides a profile of the potential target market. The second part contains details on Political, Economic, Social, and Technological (PEST) analysis. The third section offers an analysis of the business venture in terms of Strengths, Weaknesses, Opportunities, and Threats (SWOT). The fourth part of this report provides information on direct and indirect competitors of the personal flying car. Lastly, the report identifies three problematic areas that could hinder market penetration.
Profile of the Potential Target Market
The idea of a flying car has been fronted for a long time but it is yet to become a reality in terms of entry into mass production (Tucker, 2008). However, it is expected that it may enter into mass production in the foreseeable future. The most important element of this car is its versatility. For example, some prototypes are designed to transform themselves from a motorcar to a plane in just 30 seconds. This element of versatility makes the car ideal for different demographics for different reasons. For example, it is expected to become an instant all-time favorite of humanitarian agencies once it enters mass production. In terms of the behavioristic segment, the car will become the most preferred tool for making a fashion-cum-class statement by young, flamboyant tycoons and young adults from rich backgrounds.
Psychographic factors will also have a massive influence on the decisions that the design engineers, manufacturers, and marketers of the flying car will make regarding its target market. Another important target market is government. Administrative and law enforcement agencies at all levels of government will find this car an invaluable asset in their operations because of its efficiency. A typical flying car can carry up to 1000 pounds of cargo, reach road and air speeds of 65 and 115 miles per hour respectively, and cover a maximum distance of about 400 miles when fully fueled (Ibtimes.com (2011). These characteristics make the flying car an ideal utility tool for reaching out to government facilities in far-flung areas as well as facilitating rapid response to emergencies.
In terms of geographical aspects of the target market, the manufacturing company should primarily focus on the consumer and corporate segments of advanced economies. The cost of producing the car is relatively high, in most cases more than four times that of the average car. This means that the target market should be concentrated first and foremost on the most advanced countries, where a relatively higher percentage of the population is wealthy. In developing countries, focus should be exclusively on government agencies, whose procurement officers may consider the flying car the most expedient choice to take the place of an expensive helicopter or fixed-wing airplane.
PEST Analysis
Political Factors
The development of the flying car has greatly benefited from political support. For example, in the United States, the government has declared its support for the actualization of the idea and has even awarded a contract to a defense company for the development of a flight system that will be used to operate the flying car. Political support will also be required in the enactment of laws and regulations that will govern how the cars will be flying into and out of ordinary airports.
Economic Factors
Economic factors will influence the success of the idea of a flying car. Advanced economies are better placed to afford the new technology required to produce such a car. In contrast, poor countries may not afford to set up production and assembly facilities for this car. Similarly, many consumers from richer countries may afford to buy the car, yet most rich people in the developing world may consider the car an unaffordable luxury.
Social Factors
Companies that produce this car must navigate the complex issue of social acceptability of the new technology. For over a century, people across the world have gotten used to the idea of a motor car and the dichotomy between vehicles and airplanes. The introduction of a flying car will alter this dichotomy, leading to inevitable resistance. This kind of attitude is likely to manifest itself mainly in conservative societies. Thus, the companies will need to develop ingenious marketing strategies that emphasize the utilitarian need for such a type of vehicle with a view to demystify it.
Technological Factors
Both car and airplane technologies will need to be examined in terms of their influence on the success of the flying car project. For example, developers will need to keep making changes in order to ensure that the car meets both road-system and aviation standards. Since the car will depend heavily on technological systems of airports, it will need to be equipped with relevant technological tools for compatibility reasons. The technology to be relied on for both road and airport use must be efficient enough to avoid jeopardizing safety.
SWOT Analysis
The main strengths in this business are versatility and efficiency. Another strength is that flying cars offer a relatively cheap means of transport and ownership compared to helicopters and airplanes. The main weakness is production challenges. Moreover, flying-car companies will face the need to improve technological and regulatory systems on a regular basis. Incompatibility between air and road systems will also pose a major challenge. Additionally, the companies will have to deal with the rigors and setbacks of breaking new ground in road and air transport. Lastly, it will take quite some time for companies to break even and get on the path of profitability.
The flying car business brings into perspective two major opportunities. The first one is the possibility of venturing into uncharted territory. Companies that will succeed in this quest will emerge as market leaders in this new industry. The second opportunity is that companies will have the potential to capitalize on the anticipated widespread acceptability of the idea of a flying car in the long run, thereby emerging as multibillion businesses with numerous competitive advantages and massive control over target markets. The main threat is opposition from established corporate interests in both airline and automobile industries. Another threat arises from the high-risk investment involved, which is compounded by the potential for a major backlash in the event of a highly publicized mishap or accident.
Direct and Indirect Competitors of the Personal Flying Car
The personal flying car will face direct competition from light fixed-wing aircraft, helicopters, and personal cars. In the case of helicopters and fixed-wing aircraft, competition will manifest itself in the realm of reliability, durability, and sheer acceptability. Companies that make helicopters and other aircraft have already established stable tried-and-tested business models, yet none is yet to be developed for the personal flying car. For personal cars, competition will be presented on the realm of price points; ordinary personal cars are much cheaper to produce, operate, and maintain compared to flying cars. At price points ranging between $200,000 and 240,000, a typical flying car is expected to cost more than three times a mid-range luxury car (Ibtimes.com (2011). In the case of short distances, the flying car will face indirect competition from large passenger and cargo aircraft. Many target customers will have to make a choice between buying a flying car and flying luxury class in an airliner.
Three Problematic Areas That Could Hinder Market Penetration
Forecast on future challenges shows that three potential problems are likely to hinder market penetration. The first problem is social resistance to change or negative perception of the flying car. The second problem is incompatibility between road and airport systems. The last problem is the arduous process of developing an ideal business model (Casadesus-Masanell & Ricart, 2011).
Conclusion
The idea of a flying car is both executable and potentially lucrative. However, it is also extremely challenging because it involves treading into uncharted ground in the world of business. Before the flying car project commences, the company needs to develop and execute a consumer research program aimed at assessing the acceptability of the flying car in target market. Once mass production commences, a marketing strategy that stresses on utilitarian aspects of the innovation should be launched. Lastly, the company must develop an ideal business model that is both realistic and sustainable.
References
Casadesus-Masanell, R. & Ricart, J. (2011). How to Design a Winning business Model. Harvard Business Review.
Ibtimes.com (2011). Flying cars set to hit market by 2012. International Business Times, February, 7, 2011: Online.
Tucker, P. (2008). Vision: The Flying Car; Up, Up, and Away. The Futurist, 42(5), 18-24.
