Toyota Camry Hybrid Price Sensitivity Analysis

Market context analysis:

1. Ad of a product priced high in its category: Toyota Camry Hybrid

2. Category: Family/mid-sized cars.

3. Prices:

* 2007 Toyota Camry Hybrid: $26,200

* Toyota Camry (non-hybrid): $18,270 - $27,820 - avg: $23,045

4. Main competition in US (according to Wikipedia.com, prices according to Edmunds.com):

* Hyundai Sonata: $17,195 - $18,445 - avg: $17,820

* Mazda 6: $18,930 - $27,800 - avg: $23,365

* Saturn Aura: $19,945 - $23,945 - avg: $21,945

* Nissan Altima: $17,950 - $28,400 - avg: $23,175

* Ford Fusion: $17,295 - $22,730 - avg: $20,012.5

* Chevy Malibu: $17,155 - $23,410 - avg: $20,282.5

* Mitsubishi Galant: $19,899 - $26,999 - avg: $23,449

* Total average for the category: $21,636

Price sensitivity factors analysis

1. Unique value effect

There main value emphasized throughout this ad is the fact that it's a hybrid car, with all advantages thereof: cleaner exhaust, contributing to personal (though not stated clearly) and national economy. Although Toyota is not the only hybrid car manufactured (there are others by Honda and Ford), this ad doesn't mention it and presents it as a unique value inherent to Toyota Camry. The fact that a hybrid car is not a widespread phenomenon boosts the influence of this factor. We rank its influence as high (decreasing PS).

2. Substitute awareness effect

It's difficult to compare car prices and benefits just when reading this add, though most of the information is readily available for those interested, on the internet, for example. Because of this we rank the influence as low (increasing PS).

3. Difficult comparison effect

Although it might seem otherwise, comparing value for money of different cars is not trivial at best. Although there are several major factors used in comparison (such as engine capacity, horsepower, physical size), there are plenty of secondary characteristics (ranging from turning circle and engine torque to the model of the internal GPS device and MP3 player) which may be important for some. In our opinion, the influence of this fact is underestimated, and thus some hard-to-compare characteristics are missing from this ad, leaving only the hybrid nature of this car. Though it's a clear advantage in comparison to the competition, information about any car model can be obtained very easily. We rank influence of this factor as average (decreasing PS).

4. Total expenditure effect

Toyota Camry is mainly a family car, and only one such car will be usually bought per family. Also, the personal fuel economy is not emphasized here at all, so this factor has low influence here (contributing to low PS).

5. End-benefit effect

The main end-benefit effect present in this ad is somewhat skewed. Instead of emphasizing personal benefits of buying a hybrid car (such as fuel economy), the more altruistic "heal the world" reasons are presented. The bottom line message of this ad clearly states: "buy this car, and you will be blessed, as a good soul, caring about the future of our planet and about the US economy." This approach may be effective in certain contexts,