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Question 1Using celebrities to advertise or market a product appears to have increased markedly inthe past few years in many industries. Explain TWO (2) benefits of using celebrities inMorgan's communication strategy.(6 Marks)
Question 1
Using celebrities to advertise or market a product appears to have increased markedly in
the past few years in many industries. Explain TWO (2) benefits of using celebrities in
Morgan's communication strategy.
(6 Marks)
Morgan Motor Company: can the British retro sports car brand still be successful after 100 years? The once proud British car industry has all but vanished. However, there is one famous producer left in the UK: the Morgan Motor Company. It is the oldest privately held car company in the world and today the company is still 100 per cent family owned. The company was founded in 1909 by H.F.S. Morgan and was run by him until 1959. Peter Morgan, the son of H.F.S., ran the company until a few years before his death in 2003. The company is currently run by Charles Morgan, Peter's son. Morgan is based in Malvern Link, in Worcestershire, and employs 163 people. All the cars are assembled by hand and the waiting list is one to two years, although it has been as high as 10 years in the past. Business is strong, despite the economic slowdown. In 1997 Morgan made 480 cars; 14 years later, in 2011, the figure was 700. Morgan Says that one day it may make as many as 900-1,000 cars a year, but only if that can be done the Morgan way and what a totally unique and utterly inimitable way to make sports cars that is! In 2011 the estimated revenue was around £25 million. The operating profits were £320,000 in 2011, compared with £665,000 in 2009. The company employs 160 people, of whom 130 are production floor employees. Morgan history The first Morgan design was, of course, the famous Three-wheeler. H.F.S. Morgan designed a fun car, the Morgan runabout, for people with little money but with a sense of adventure. The car was a great success and in the 1920s the Morgan factory in Malvern was making 2,500-3,000 cars a year, with a smaller number being built under licensee in France under the Darmont Morgan brand. Nevertheless, each year production always sold out in advance, as customers were desperate for small cars at this time. Morgan Three-wheeler sales declined and by 1935 there were only 300 new orders. The reason for this was the arrival of mass-produced popular cars from Ford, Morris and Austin at a similar price but offering more features for the money. H.F.S. Morgan had to come up with a new design. He did this in 1936 and announced the Morgan Four, a light sports car with four wheels and a four- cylinder Coventry Climax engine. From the start, the Morgan Four made its name in competition and finished well at Le Mans in 1938 and 1939. In 1962 Morgan won the two-liter class at Le Mans. A production Morgan beat the specially modified Porsche and Lotus racing cars and then drove home: the car averaged 98 mph for the 24-hour race. Following the race, the Morgan plus Four Super sports was launched as a factory model so that customers could buy a Le Mans class winner. Morgan's cars became regular winners in production sports car races across the US. At this time the Morgan Motor Company was one of the first companies to benefit from celebrity endorsement-Ralph Lauren, Brigitte Bardot and David Bailey all drove Morgans in the 1960s. In 1989 a visit was made by businessman Sir John Harvey Jones and makers of the BBC program Troubleshooter. Sir John criticized the company's strategy of having a long waiting list and making every- thing by hand in such a labor-intensive way. Morgan is probably the only car company that still makes cars the way they were made in the early 1900s-building them on a wooden frame and crafting them mainly by hand. Sir John did not really understand Morgan's market. Coachbuilding (by wood) and a waiting list are strengths, not weaknesses, of the business. Coach- building the cockpit area produces a light, strong cabin that is durable and the waiting list maintains second-hand prices. There was much humor over the "Sir John Hardly Knows T-shirts that subsequently appeared at Morgan Sports Car Club meetings. 3