The average Israeli consumer wants "a lot of car for a little money". The term "a lot" refers to clear, concrete physical characteristics; the larger the car, the more horsepower and accessories, the higher its value in the eyes of the Israeli consumer.
Thus, the Israeli market clearly and traditionally prefers four-door models with a separate trunk. These are considered more prestigious in Israel than the five-door models of the same cars.
This is opposed to the current marketing trend in Europe, whose most prominent characteristic is the growth of the market for the urban mini-car. These are very compact models of 3.5 m in length or less, designed for up to four passengers.
In their 90s incarnation, the urban mini-cars target a very different population. The target population, as defined by the marketers, is characterized by high social and environmental awareness, sophistication, and above-average income. The motivation for the acquisition is not savings, but the desire for rapid travel ability in the city, image and fashion benefits.
These mini-cars are not inexpensive. At the price of a mini-car like the Renault Twingo, for instance, one can purchase the basic model of a Renault Cleo, larger and more spacious than the Twingo.
The marketing strategy currently in use by automobile manufacturers is positioning these cars on the value-for-price approach of fashion products such as clothing and perfumes. Choosing this line is not coincidental. In both cases, there is a strong emphasis on the psychological and emotional benefits of the product, instead of its direct physical benefits.
For instance, Renault markets the Twingo along with fashion shows and concerts in France. The company also occasionally approaches well-known fashion houses, which lend their names to special limited editions of the car. Ford, for instance, intends to launch the KA, its new mini-car, with a limited choice of colours. Each new colour added will be a sort of "addition to the collection" and be given special exposure, similar to the launch of a new perfume.
Mercedes has taken the most extreme approach, collaborating with fashion watch manufacturer Swatch in developing its future mini-car. The two companies’ joint car will be characterized by modular features which will allow psychedelic colour combinations, similar to Swatch wristwatches.
Such marketing tactics do well with the European target population. In 1995, 540,000 automobiles in the mini-car market were sold, and this market sector is estimated at 1.2 billion by the year 2000.
In Israel, in contrast, the story is entirely different. Renault’s Twingo, the only representative of the fashionable mini-car category in Israel, has so far received a rather chilly reception. In the past two years, 600 cars were sold, compared to the 25,000 compact cars sold such as the Renault Cleo and the Fiat Punto.
This data led Ford’s importers, for instance, to decide not to import the KA, currently extremely successful in Europe. Fiat also has decided, for these reasons, that there is no potential market to justify import of the Lancia Epsilon.