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OnStar Jeff Schoenle CSR 631 November 4, 2008 Topics • OnStar ▫ Company Overview ▫ Technology ▫ Product Services • Consumer Behavior Theories ▫ Theory ▫ Marketing Strategies • Conclusion Company Overview • Owned and operated by • Formed in 1995 through General Motors Corporation partnership between GM, ▫ OnStar services are optional Hughes Electronics Corp., and on approximately 50 different Electronic Data Systems GM vehicles ▫ Companies worked together Chevy, Buick, Pontiac, GMC, in designing software and Hummer, Saab, Cadillac, hardware in order to bring Saturn the OnStar service online • Paired with Verizon Wireless cellular service ▫ Can tie in OnStar service to your wireless plan Technology • Works with GPS and cellular • Three Button System communication technology ▫ White button on left controls • Cellular antenna is located in hands-free calls vehicle If You Need To Make An ▫ Sends signal to OnStar Center Important Phone Call ▫ Can talk with representative ▫ Blue button in middle at center 24/7/365 via connects you with an OnStar microphone located in cabin representative • GPS determines location of the ▫ Red button on right signals vehicle to aid in response an emergency Product Services • Vehicle Diagnostics • Crisis Assist ▫ Monthly reports on your ▫ Can help you in case of poor vehicle’s diagnostics weather or natural disaster ▫ Reports available on demand • Stolen Vehicle Assistance • Turn-By-Turn Navigation ▫ Can help locate your vehicle if ▫ Voice-guided directions from stolen one location to a destination ▫ Stolen Vehicle Slowdown • Automatic Airbag Deployment Technology Response • Remote Door Unlock ▫ Representative will try to ▫ Locking keys in your car contact you in vehicle if • Roadside Assistance airbags deploy ▫ Flat tire, out of gas, blown • Emergency Services engine – NO PROBLEM! ▫ Can notify emergency • Accident Assist services if accident occurs ▫ For fender benders Product Services (cont.) • Ride Assist • Virtual Advisor ▫ Can help you find a ride if you ▫ Local traffic and weather, are unable to drive stock updates ▫ If This Looks Like You • Driving Directions • Information/Convenience ▫ Connect with a real person Services for directions to your ▫ Hotel or restaurant destination recommendations • Remote Horn and Lights ▫ Locate your vehicle if you forgot where you parked it Marketing Strategies • Target Market • Impacts of Consumer ▫ Car owners/buyers or Behavioral Traits prospective car ▫ Want to feel secure owners/buyers ▫ Want to feel like part of ▫ On-the-go population community Families ▫ Want to feel important Working adults ▫ Want to feel like they are Sales reps receiving more value than ▫ Travel enthusiasts they are giving up Those taking long or Cost/Benefit basis frequent trips Marketing Strategies • Possible New Markets • Reduce Cost ▫ Small businesses ▫ Price currently set at Pizza/Food delivery $18.95/month or $199/year Package Delivery Services ▫ Affordability Possibly work with computer ▫ Luxury Item companies to develop ▫ Economic Troubles transitional software for these businesses ▫ Other Car Companies Currently only available on GM vehicles Sell services to competitors Consumer Behavior Theory • Consumer Value • Interactive ▫ Consumer value is defined as ▫ Involves an interaction between an interactive relativistic the consumer and the product preference experience (Hilliard • Relativistic 1950) ▫ Consumer value is comparative, ▫ These four aspects are personal, and situational interrelated ▫ “It was nice, but just wasn’t for me. I suppose it would be good for ▫ Each aspect can influence the people who get in accidents or get others lost easily or have car problems, but it wasn’t for me and wasn’t worth the price.” – Shelley Poznic (Portage, IN) • Preference ▫ Consumers have preferences based on value judgments • Experience ▫ Consumer value resides in the consumption experience Consumer Value • Extrinsic vs. Intrinsic • Active vs. Reactive ▫ Receive value from ▫ A physical or mental consumption results, interaction with the object or achievement of goals product ▫ Receive value from the act of ▫ Responding to something consuming done or caused by the object • Self-Oriented vs. Other- or product Oriented ▫ Value the consumption for the benefit it gives to yourself ▫ Value the consumption for the benefit it gives to another party What Do You Think? • What category (categories) do you believe OnStar will fit into? My Thoughts • Efficiency • Excellence ▫ Convenient one touch ▫ Can give you hotel and buttons restaurant recommendations ▫ Hands free dialing ▫ Search for quality ▫ Directions to get you where • Spirituality you need to go quicker ▫ Stolen Vehicle Slowdown ▫ Notices about traffic and ▫ Emergency Assist weather Feeling of safety and ▫ Diagnostic checks on vehicle security for family or other condition passengers Conclusions • OnStar is classic example of the aspects of consumer value • May also be viewed using consumer choice theory ▫ Against competitors or similar products (TomTom) Sources • Information about OnStar can • Information pertaining to be found at the OnStar website Consumer Value was found in or on the General Motors the article “Consumer Value: A website Framework for Analysis and Research”; Morris B. Holbrook, 1999.