A Cadillac for Five-Hundred Dollars?
Topic Introduction to Marketing
Key Words Lifetime value of a customer, brand extension, brand equity, relationship marketing, targeting
InfoTrac Reference A134661378
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News Story 

So you're young, and all the savings you have to your name are being gobbled up by college tuition and the occasional pizza date with that sexy, famous supermodel…er, your first available classmate. What does a world-class luxury automaker have to do with your stressed-out, penny-pinching existence? Nothing, you say? Think again.

In an attempt to introduce younger consumers to the award-wining performance and style that have made its vehicles famous, General Motors Corp. has licensed its Cadillac luxury car brand and logo to Kent International Inc., the manufacturer behind Cadillac Bicycles, a new line of mid- to high-end bikes that sell for between $500 and $1,900. Developed by a team of bicycle enthusiasts and industry veterans, Cadillac Bicycles combine traditional as well as innovative bicycle designs made from the finest materials and craftsmanship, giving riders an unparalleled cycling experience.

For college students and other young people for whom money is scarce, owning a Cadillac XLR or Escalade SUV may be many years down the road. In the meantime, Cadillac wants such consumers to own a Cadillac bicycle--for leisure, racing, or off-road fun. The hope is that new riders hooked on the Cadillac cycling experience will someday trade in their two-wheel mountain bikes for four-wheel luxury cars.

Questions
1.

Do you think this new line of Cadillac-branded bicycles will help General Motors make long-lasting connections with consumers? Why or why not?

2.

What might be an effective way for Cadillac Bicycles to advertise and promote its line of high-performance bicycles to target customers?

Source "Cadillac appeals to cycling enthusiasts," PR Week (US), August 1, 2005 p04.
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