Vespa Research Paper
I. Executive summary
The purpose of this research is to determine if there is demand for a Vespa scooter
dealership in the Bryan/College Station area. We believe that this college town could be a
profitable target market and we set to identify what could make a Vespa dealership
successful in our area. Using available secondary research and conducting interviews with
scooter dealers, we were able to discover criteria to compare to the Bryan/College Station
market.
In addition, we researched the overall Bryan/College Station area. This included secondary
research to determine demographics, target markets, trends, and more about the Vespa
image. We wanted a better understanding of who our consumer would be. Also, we
conducted a survey distributed to Bryan/College Station residents. This provided us with
local residents current opinions about Vespa and allowed us to either confirm or reject
whether there is a demand in the town.
Conducting research is a vital step in determining the success of opening a Vespa
dealership. After analyzing and reviewing the data, we have determined that there is not
demand for our dealership. We had not accounted for the students lack of interest and little
nostalgic appreciation of the Vespa name. Our survey revealed this information as well as
other negative associations with scooters. To create a profitable marketing opportunity, it
would be necessary to organize a massive marketing campaign to promote the image and
create demand.
II. Introduction
The Vespa, an Italian made scooter, was designed by Enrico Piaggio in 1946. The vehicle
was originally created with a focus on economic efficiency as well as elegance and
comfort. It was very different from the scooters of the time; its sleek, sophisticated style
resembled a wasp, which sparked the name Vespa, wasp in Italian. Vespa has lived on
from one generation to the next, subtly modifying its image each time. “The first Vespa
offered mobility to everyone. Then, it became the two-wheeler of the post war economic
boom. During the sixties and seventies, the vehicle became a symbol for the revolutionary
ideas of the time.” (www.vespa.com)
This European icon and mode of transportation debuted in the U.S. market in the 1950s
and was forced to leave the market in the 80s due to the stringent demands of the
Environmental Protection Agency. In 2000, the Vespa scooter re-entered the U.S. market
with endless possibilities. The popularity of Vespa in the US was a symbol of a changing
society that value freedom, fashion, and a unique flare.
After Vespas 15 year absence, the company believed their main market would be young
adults looking for cheap transportation when in reality their main consumers were aging
baby boomers who looked for nostalgic memories of their youth. Vespa has grown
tremendously in the U.S. market beginning in Western States such as California and is
rapidly expanding across the nation. Currently in Texas, there are four dealerships located
in the major hubs of Houston, Dallas, Austin, and San Antonio.
Our purpose for the research was to determine if there was a market opportunity for
opening a Vespa dealership in the Bryan/College Station area. We thought it was a viable
idea worth exploring to decide the potential of the market. We determined to distribute
surveys in addition to gathering secondary research to either confirm or reject our
hypothesis.
The Bryan/College Station area is expanding rapidly and primarily revolves around the
Texas A&M campus. The market consists of a majority of college students with short
distance travel needs. These students also have concerns with the lack of parking on
campus. A scooter would allow them to drive themselves to class and avoid buses in
addition to parking in motorcycle permit slots closer to buildings.
College students are often stereotyped as strapped for cash, which is often true. They are
on budgets and would possibly be interested in a gas saving mode of transportation. With
prices rising, more people are forced to search for alternatives. The Vespa was a fuel
efficient solution. As we examined the market, it seemed that the area was ideal for a
Vespa dealership.
We agreed to further explore the possibilities of the dealership. We collected relative
secondary data and designed a survey to discover opinions and beliefs.
The purpose of this research was to explore the following questions:
• Should we open a Vespa dealership?
• Does the Bryan/College Station market match the Vespa target market?
• Is there an interest in our product?
III. Research
We have chosen to answer our research questions using secondary data, surveys, and
phone interviews. They were a strategic and practical source in drawing conclusions.
Using this information we were able to determine that opening a Vespa dealership was not
a profitable opportunity for us.
A. Secondary Data
We utilized secondary research as a cost effective solution to researching the market. We
gathered information that we felt would be useful in answering our research questions on a
variety of topics including demographics, transportation trends, Vespas reentrance to the
market, Vespas target market, Vespas image, and how to open a Vespa dealership.
Demographics:
The City of College Station as its name suggests is a college town. It is mostly dominated
by over 44,500 students attending Texas A&M, the nations fifth largest institution and
more than 14,000 at Blinn Community College. Because of this, it is of no surprise that
according to statistics from 2004, 47% of the population is aged between 18 and 24.
While the population is very young, some may jump with haste to the conclusion that this
is a liberal and trendy area. With street names such as George Bush Drive, this is hardly
the case. According to the Princeton Review, Texas A&M is the top 15 most conservative
University in the nation. With few public transportation options available, College Station
has a high car ownership. The following summarizes this:
In addition, it is also found that 76.8% of the total population drives alone to work or class.
http://www.cstx.gov/home/index.asp?page=397
www.princetonreview.com/mba/research/profiles/generalinfo.asp?
listening=1011088<ID=2
Competition:
Currently in the Bryan/College Station and Texas A&M market, Vespas transportation
competitors consist of automobiles, motorcycles and other motor scooters. In comparison
to automobiles, Vespa receives 100% more miles per gallon than the average car, SUV,
truck, and wagon (Fig. 1). When comparing price, Vespa is the cheapest option with the
prices ranging from $3000 to $4500, while the price of automobiles is much higher. The
typical car has many benefits that the Vespa does not provide, such as multiple passenger
capability, higher safety ratings, weather coverage, as well as numerous outlets for
purchase. When comparing Vespa to motorcycles, the US Department of Transportation
states that the average motorcycle receives 50.1 miles per gallon while the Vespa receives
over 60. The average price of a motorcycle is significantly greater because of the wide
range of options. Other motor scooters have similar statistics as the Vespa with the fuel
efficiency being very high. There are also electric scooters that require no gas. There is a
wide range of price for the scooters and a buyer has the ability to purchase them at a
substantially low price or a very excessive one. The outlets for automobile purchase are
very high in the Bryan/College Station area. Motorcycle dealerships are scarce with only
nine outlets offering this mode of transportation but the variety of options is very high
ranging from Harley Davison to Honda to Suzuki. In 2002, the Indian dealership here in
town closed after finding that the market did not support their store. Currently there are
four establishments in the B/CS area that sell competing brand motor scooters but in
addition to the scooter they sell a variety of other vehicles such as 4-wheelers, gators,
motorcycles, and jet skis. Like the Indian dealership, M&M Powersports has closed their
doors within the past year due to lack of a market for their product. There is currently no
outlet for Vespa purchase in the B/CS area.
Figure 1
Legend
1 : Vespa 4 : SUV
2 : Truck 5 : Car
3 : Wagon
www.autobytel.com
www.scootertronics.com
US Department of Transportation, Bureau of Travel Statistics
http://www.ridetowork.org/docs/2005_trans_faq.pdf
www.areawide.dirxion.com
Transportation Trends:
• Honda, Harley-Davidson and even Vespa link MPG to sales
o Sales of scooters, which get between 45-75 mpg, are up 65% from 2004; U.S. scooter
sales have gone from 12,000 in 1997 to 96,000 last year.
o Vespa will launch a campaign this month touting its scooters as solutions to traffic and
soaring gas prices. The effort, via The Ad Store, New York, includes ads that read,
“Relieves gas pains,” “Dont be a gas-hole” and “We have one word for crazy gas prices:
Ciao.” Vespa nearly tripled its sales in September 2005 versus September 2004, per
Federico Musi, vp-marketing.
• Vespa: 15 year absence from U.S. market
The company is beginning an advertising push for its new motor scooters that targets
congested urban areas and frustrated drivers. Motor scooters, long a favorite mode of
transportation in Europe and Latin America, have been growing in popularity in the United
States, according to the Motorcycle Industry Council. Sales of motor scooters in the United
States have risen from 12,000 in 1997 to 69,000 last year.
• Turismo Bellissimo
American scooter sales have risen more than 500 percent in the past five years, as car and
