Case 4 TABH, INC., Automotive Consulting

Case 4 TABH, INC., Automotive Consulting
(Download the data sets for this case from www.cengage.com/
marketing/zikmund or request them from your instructor.) TABH
Consulting specializes in research for automobile dealers in the
United States, Canada, Mexico, and Europe. Although much of
their work is done on a custom basis with customers such as dealerships
and dealership networks selling all major makes of automobiles,
they also produce a monthly “white paper” that is sold via their
Web site. This off-the-shelf research is purchased by other research
firms and by companies within the auto industry itself. This month,
they would like to produce a white paper analyzing the viability of
college students attending schools located in small college towns as a
potentially underserved market segment.
TABH management assigns a junior analyst named Michel
Gonzalez to the project. Lacking time for a more comprehensive
study, Michel decides to contact the traffic department at Cal Poly
University in Pomona, California, and at University of Central Missouri
in Warrensburg, Missouri. Michel wishes to obtain data from
the students’ automobile parking registration records. Although both
schools are willing to provide anonymous data records for a limited
number of students, Cal Poly offers Michel a chance to visit during
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Comprehensive Cases 637
the registration period, which just happens to be the following week.
As a result, not only can Michel get data from students’ registration
forms, but she can obtain a small amount of primary data by intercepting
students near the registration window. In return, Michel is
asked to purchase a booth at the Cal Poly career fair.
As a result, Michel obtains some basic information from students.
The information results in a small data set consisting of the
following observations for 100 undergraduate college students in
Pomona, California:
Variable Description
Sex Student’s sex dummy coded with 1 = female and 0 = male
Color Color of a student’s car as listed on the registration form
Major Student’s major field of study (Business, Liberal Arts (LA), or Engineering (ENG))
Grade Student’s grade record reported as the mode (A, B, or C)
Finance Whether the student financed the registered car or paid for it with cash, coded 0 = cash payment and 1 = financed
Residence Whether the student lives on campus or commutes to school, coded 0 = commute and 1 = on campus
Animal Michel asks each student to quickly draw a cartoon about the type of car they would like to purchase. Students are told to depict
the car as an animal in the cartoon. Although Michel expects to interpret these cartoons more deeply when time allows, the initial
coding specifies what type of animal was drawn by each respondent. When Michel was unsure of what animal was drawn, a second
researcher was conferred with to determine what animal was depicted. Some students depicted the car as a dog, some as a cat, and
some as a mule.
The purpose of the white paper is to offer car dealers considering
new locations a comparison of the profile of a small town university
with the primary market segments for their particular automobile. For
instance, a company specializing in small pickup trucks appeals to a different
market segment than does a company specializing in two-door
economy sedans. Many small towns currently do not have dealerships,
particularly beyond the “Big 3.” Although TABH cannot predict with
certainty who may purchase the white paper, it particularly wants to
appeal to companies with high sales growth in the United States, such as
Kia (http://www.kia.com), Hyundai (http://www.hyundai-motor.com), and
potentially European auto dealerships currently without significant U.S.
distribution, such as Smart (http://www.smart.com), among others. TABH
also hopes the white paper may eventually lead to a customized project
for one of these companies. Thus, the general research question is:
What are the automobile market segment characteristics of students attending
U.S. universities in small towns?
This question can be broken down into a series of more specific
questions:
• What segments can be identifi ed based on identifi able characteristics
of students?
• How do diff erent segments view a car?
• What types of automobiles would be most in demand?
Questions:
1. What types of tests can be performed using the data that may at
least indirectly address the primary research question?
2. What do you think the primary conclusions of the white paper
will be based on the data provided?
3. Assuming a small college town lacked an auto dealership
(beyond Ford, GM, and Chrysler), what two companies should
be most interested in this type of location? Use the Internet
if necessary to perform some cursory research on different car
companies.
4. What are the weaknesses in basing decisions on this type of
research?
5. Are there key issues that may diminish the usefulness of this
research?
6. What kinds of themes might emerge from the cartoon drawings?
7. Are there any ethical dilemmas presented in this case?