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Market analysis is a necessary part of planning a profitable business. Invest time in this crucial step now
and reap the rewards of a successful business. Before investing any money in our business, we must
gather information about our potential customers and the demand for of service. This information, or
market analysis, is a necessary part of planning a profitable business. Invest time in this crucial step
Knowing who our customer is, what we need, and where to find them is vitally important. Targeting the
right people is crucial for generating cash flow in the shortest time possible.
An examination of current market conditions tells us who our competitors are, the size and location of
the market, current competitor pricing and promotional strategies, and types of market niches which are
underdeveloped.
Positioning our product for greatest exposure, while creating an image of quality and value for our
3) Reduced Expenses
A leading cause of business failure is lack of capital - the business runs out of start-up funds before
becoming profitable. It's important to make every penny count. We reduce expenditures by trying to
predict outcomes before taking action. There is always a certain amount of risk with any business
Overview
Whether we are starting a new business or launching a new product, conducting a marketing analysis is
the first step in determining if there is a need or audience for your idea. Knowing the market's needs and
how it is currently serviced provides us with key information that is essential in developing our
product/service and marketing plan. Too often, businesses spend thousands of rupees launching a "new"
idea with a limited market because of competition. The owner is forced to reevaluate his strategy and
determine if there is room for another player. Although the quality of the product is critical, our
development of the best product on the market will not necessarily correlate with the most sales. Up to
50 percent of a product's price can be for marketing. The company who wins the marketing game
The marketing analysis process can be broken down into six steps:
6. Designing a plan.
Defining the problem is crucial to conducting a successful marketing analysis. This may require a great
deal of time but it is well worth the time and energy expended. Defining the objectives is crucial to a
successful marketing campaign. Many individuals waste valuable time performing good research on the
wrong problem.
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Many companies fail to understand the nature of the problem before trying to solve problems related to
sales. A classic example occurred in the soft drink industry when Coke and Pepsi, the two top soft drink
rivals increased the intensity of marketing efforts to battle for higher sales. At the same time, Dr
Pepper's revenues began to decline, a problem that was attributed to a weak promotional campaign.
Subsequently, the "Be a Pepper" slogan was instituted. Although the ads were a hit, revenues continued
An analysis of the situation is an informal survey of what information is available in the problem area.
The analysis will help define the problem and ascertain the need for additional information. This
process entails informal talks with informed people. Informed individuals can be others in the company
or outsiders with knowledge about the industry or product. In some instances, customers are contacted
to provide information.
When the marketing manager is unfamiliar with the situation, the analysis step is of primary
importance. It is important to understand the problem area - including the nature of the target market,
competition, the marketing mix and the external environment. Without this knowledge, costly mistakes
may result. An example of this problem would be a retailer who wants to survey his customers. A
research firm is hired to do in-store interviews. However, as an example, the contracted firm is not
aware that many of the stores are in the process of being renovated. As a result, the information
collected reveals the customer's focus on the appearance, noise level and difficulty finding items due to
Primary research is research that is proactively created for a specific purpose. Primary research may
include focus groups, qualitative surveys and phone interviews. This is information we collect our self.
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In contrast, secondary research is research that has already been conducted for other purposes. From it
valuable information can be taken. Secondary research can be found in libraries, online, through
periodicals, books, etc. The easiest and most efficient way of accessing this type of data is on the
Internet.
The next step requires gathering primary research and performing a formal research project. Many
approaches can be used to collect primary data. The purpose is for the research to identify what
customers think about some topic or behavior patterns. Research can be done in person or through a
survey. Questioning can be qualitative or quantitative. Another research option is to use observation of
Qualitative research utilizes open-ended questions to obtain in-depth answers. Closed-ended questions
requiring yes or no answers are avoided. The idea is to have people share their thoughts on a topic
Quantitative research differs from qualitative in that it gathers parametric statistical information, i.e.,
information with a number to it. Sample sizes are generally larger and more representative of the
market. From the statistics or data generated, conclusions can be drawn. Survey research is usually
quantitative in nature. It seeks structured responses, which can be summarized in numbers, like
Data analysis and interpretation is critical in analyzing the market. What does this information mean?
Can one use the data in a constructive way to define the problem and then establish a plan? In
quantitative research, this step most often involves statistics. In the marketplace one can find many
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It is impossible to collect data on every person in a select population; therefore samples are necessary.
A sample population is a part of the relevant population. How well the sample reflects the relevant
population dictates its validity. Results from a sample that is not representative will negatively impact
your marketing.
In addition to sampling and validity issues, marketing managers must make sure the data supports the
conclusions drawn. This is the interpretation step. Despite use of the correct statistical tool and accurate
calculations, the interpretation could be wrong. Example of Data Misinterpretation: In a survey, parents
were asked to rank five infant car seats for ease of use. They were to rank the seats in order from "most
preferred" to "least preferred." One car seat was ranked first by slightly more respondents than any
other car seat. The researchers reported that it was the most liked car seat by parents with infants. They
failed to report that 70 percent of the respondents preferred that particular car seat least. So, the first-
ranked car seat was most preferred by only 30 percent of the parents.
In this step, the research results are used to make marketing decisions. The findings should be applied in
marketing planning. If the research doesn't provide the information necessary to make these decisions,
the company, whether small or large, has wasted its time, money and manpower on unnecessary data.
6. Marketing Plan
This six-step process of market analysis is critical in designing a marketing plan that is tailored to your
specific product or service. The process can be extremely helpful in disclosing a significant but
previously unrecognized problem. By finding and focusing on the real problem, the researcher and
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A marketing plan shows the specifics of how you will market or attempt to sell your product or service.
To reiterate the purpose of this discussion, the marketing plan is to provide us with guidance in
analyzing your market. Various resources and software packages are available to enhance our marketing
Automotive industry
The automotive industry designs, develops, manufactures, markets, and sells the world's motor
vehicles. The automotive industry is one of the most important economic sectors by revenue.
The term automotive industry usually does not include industries dedicated to automobiles after
delivery to the customer, such as repair shops and motor fuel filling stations.
The Automobile industry in the Republic of India is the seventh largest in the world with an annual
production of over 11 million vehicles and exports of about 1.5 million. In 2009, India emerged as
Asia's fourth largest exporter of automobiles, behind Japan, South Korea and Thailand. By 2050, the
country is expected to top the world in car volumes with approximately 611 million vehicles on the
nation's roads. A major chunk of India's car manufacturing industry is based in and around the city of
Chennai and hence it is known as "Detroit of India". Chennai accounts for 60 per cent of the country's
automotive exports.
Volkswagen India
Volkswagen India Private Limited is a subsidiary of Volkswagen Group Sales India Private Limited
that assembles, manufactures and distributes Volkswagen vehicles in India. It was established in 2007.
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Manufacturing Facilities
Volkswagen India Private Limited operates a manufacturing plant in Chakan which is capable of
producing 110,000 vehicles per annum. The plant is also shared by Skoda Auto India Private Limited
Manufactured/Assembled Locally
• Volkswagen Polo
• Volkswagen Jetta
• Volkswagen Passat
• Volkswagen Vento
Imported
• Volkswagen Beetle
• Volkswagen Phaeton
• Volkswagen Touareg
Volkswagen, one of the largest car manufacturers in Europe, is betting big on India with its small car
portfolio. Though India contributes a mere 0.3% to the global sales of Volkswagen group, the company
is planning to increase its market share in the country by 8 to 10% in the next four-to-six years.
Volkswagen Beetle
The Volkswagen Beetle, also known as the Volkswagen Type 1, was an economy car produced by the
German auto maker Volkswagen (VW) from 1938 until 2003 with over 21 million manufactured in its
air-cooled, rear-engine, rear wheel drive configuration. Its platform ultimately gave rise to successful
variants, including the Volkswagen Karmann Ghia and the Volkswagen Type 2 van.
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In the 1950s, it was more comfortable and powerful than most European small cars, having been
designed for sustained high speed on the Autobahn, and ultimately became the longest-running and
most-produced automobile of a single design. It remained a top seller in the US, even as rear-wheel
drive conventional subcompacts were refined, and eventually replaced by front-wheel drive models —
owing much of its success to high build quality and innovative advertising.
New Beetle
design studio, the concept car was based on the platform of the Volkswagen Polo. Strong public
reaction convinced the company to develop a production version which was launched as the New Beetle
New Beetles are manufactured at Volkswagen Group's Puebla, Mexico assembly plant where the last
A classic
Volkswagens are famed for their traditional quality and the New Beetle is naturally no exception all
materials used is carefully tested and has outstanding workmanship. The body is galvanized giving
reliable protection against rust. The high-strength panels on the New Beetle are given additional
stability at specific points which achieves a very high level of torsional rigidity. The precision fit of
Self assured
Yes, we know it’s a small car. But when it comes to safety, the New Beetle gives you a feeling of
security the moment you are seated inside. With ESP, ABS and other safety features in tow, the New
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Beetle comprises of a comprehensive active safety package, making it one of the safest vehicles in its
class. We have also equipped the New Beetle with a passive safety package that gives you the greatest
possible protection. The carefully matched restraint system, consisting of four airbags and a 3-point
inertia reel seat belt system at front and rear, is also part of the standard equipment. Go ahead and enjoy
the drive.
In a New Beetle, you enjoy the comfort and convenience afforded by an exclusive standard
specification. Right from the 116PS (85 KW) engine version, it includes electrically adjustable and
heated door mirrors, power steering, colour-keyed door mirror housings, door handles and bumpers and,
As Indian automotive industry is one of the major growing Industries in the world. With the
impact of globalization, there are many new players in the Indian auto industry. As the Volkswagen
launched its Beetle in India, which is mid-sized luxury car priced quite high. So the research was
carried out to have a market analysis regarding the new Beetle in Indian Market.
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CHAPTER IV
RESEARCH METHODOLOGY
Research Problem
Research Design
Research Design is exploratory and descriptive which helps me to explore and describe the
market potential and market factors to be considered for New Beetle by Volkswagen.
Sampling Design
The study aimed to survey 15 samples from Delhi. Samples consist of the customer or prospects.
Data Collection:
Both primary and secondary data have been collected for meeting the objectives of the current
study.
For the purpose of the collection of the primary data, personal interview of the respondents
was conducted. An unbiased, undisguised structured questionnaire was prepared which was
administered to the respondent for the purpose of getting the information. With the reference of certain
previously carried studies, certain statements for getting out the customer perception were formulated
For the purpose of secondary data, secondary sources of information like magazines, newspapers,
journals; studies conducted in past etc. have been referred. The main sources of secondary data in the
study
1. Magazines
2. Websites
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Analysis Techniques
The questionnaire is having the alternative choices. Questions having alternative choices have
The scope of the study is limited to the customers visiting to the Maruti & Tata Showroom in
Delhi.
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CHAPTER V
Analysis and Interpretation: Majority of the respondents are using the brand Maruti Suzuki followed
by Hundai. Data shows that majority of customers prefer to buy cars of Maruti Suzuki, because it is the
most popular, famous brand in Indian Automobile Industry. The interpretation can be made that most of
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Analysis and Interpretation: Results shows that mostly the customers prefer the B segment cars
followed by A segment. This shows the demand structure and preference of Indian car buyer which is
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Analysis and Interpretation: The customer can afford 5-10 lac for buying a car, which is mostly for
the B segment cars. So interpretation can be made that the mid segment cars are mostly preferred as
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Analysis and Interpretation: Efficiency is the most important factor that is considered while
purchasing a car. Next important factor is comfort. As India is a developing country, mostly people
prefer to purchase fuel efficient cars. That’s why Diesel cars are preferred in Indian market.
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Analysis and Interpretation: Majority of the respondents prefer to buy foreign car brands. Reason
may be interpreted as the availability of the foreign car manufactures in India. There is no doubt that
mostly the car brands belong to abroad, but now they manufacture and assemble their product according
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Analysis and Interpretation: Majority of the respondents know about the Volkswagen Beetle. Reason
behind that Volkswagen is global brand and the goodwill of that brand is very high in market.
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Analysis and Interpretation: Majority of the respondents Least interested to purchase Volkswagen
Beetel.Major reason behind that, In Indian market; it stands in B segment while the cost of Beetle
stands in D segment. The cost of Beetle is very high in context to Indian market.
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CHAPTER VI
SWOT ANALYSIS
Strengths
It stands apart from all other cars on the road - Volkswagen Chairman Ferdinand Piece is even
amazed at the car’s appeal. “It is different, and it makes you feel different, “he said. “It’s like a
magnet”. It’s curved outline, rounded fenders and oversized lights separate it from the other vehicles on
the road. The biggest-selling car design in history gets even better - It’s cute and trendy, more
comfortable than its predecessor and there are a whole lot more luxuries and new technologies crammed
into this nostalgic Beetle. The New Beetle’s safety surpasses the rest - The 1998 model of the New
Beetle is the safest small car that has been tested by the Insurance Institute for Highway Safety.
Weaknesses
It’s not an SUV - Americans are showing a strong trend toward purchasing Sport Utility vehicles
rather than conventional sedans. A Gallup Pole recently asked 1,003 adults: Which of the following best
Although recent purchase trends put sedans in the lead, projected trends are saying that Americans are
leaning toward SUVs. The survey showed that 51 percent of people planning on purchasing within the
next year are more likely to purchase and SUV compared to 39 percent purchasing a new vehicle more
than a year from now. Also an indicator, three out of four SUV owners say their next vehicle will also
be an SUV4. The Volkswagen New Beetle is termed a “small sedan.” Looking at its competing models
(which will be discussed later) I would tend to put the New Beetle in the ‘small car’ category which
shows very little market favor. Brand loyalties favor American vehicles - The preference for American
vehicles is more than three times higher than that of European vehicles. 78 percent of people surveyed
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in a Gallup Pole said that they would definitely or probably consider buying an American vehicle while
Opportunities
The New Beetle has a global appeal - Americans aren’t the only ones who love this car. There is much
opportunity for growth internationally. Japan is predicted to have the Potential to be the second-largest
New Beetle market. There is also hope that Beetle mania will spread across all of Asia.
Capitalize on nostalgic cravings - The old Bug was the biggest-selling car design in History. Baby
boomers loved their groovy cars as young adults and today’s young adults are looking to rediscover the
age that passed. As we approach the next millennium there has never been a better time to capitalize on
the nostalgia Americans are craving. The Beetle is a strong representation of the past and may find itself
Threats
Can trendy stay alive? - Will the New Beetle survive as long as its predecessor? We see many trends
come and go. Does the New Beetle have what it takes to survive?
Can the Beetle be duplicated? - Would another car company trying to duplicate succeed? If the
success of the New Beetle continues there will be other car makers wanting to hop a ride on the
bandwagon. Could the New Beetle survive if another company could produce more cars of similar
attributes faster?
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Will history deter some drivers? - The first Beetles were manufactured in Wolfsburg, Germany, at a
plant built by the Nazis. Although the war is long since over, there are still many people who will treat
the Volkswagen Beetle with the same prejudice and distaste they feel for the actions of the Nazis.
Market Segmentation
The New Beetle is unique from other cars in that its market is huge. The range of interest for the
automobiles is from 16-year-olds to 65-year-olds.The car appeals to drivers of many social classes.
From college students to CEOs the Beetle has found its way into garages of all classes. What do all of
these consumers have in common? Simple, they’re tired of driving the same old pod-like cars and the
Target Markets
Volkswagen executives refuse to be pinned down on the New Beetle’s target market saying only that it
is designed for “optimists.” Yet it’s clearly aiming wide. While many of the ads sport jokes targeted at
the previous Beetle generation, others are aimed squarely at Gen-X. Edmund’s web page on automobile
reviews identifies the target buyer as “men, women, young people or people who are simply young at
heart.” The New Beetle is marketed as classic, classy, unique, and economical. It’s for the kind of
person who likes to have fun, appear fun, and stand apart from a crowd.
Competitor Analysis
Volkswagen’s top competitors (as a company) are Ford, General Motors and Toyota. All of these
companies are very successful in the American market and provide strong competition for VW which
has been struggling in this marketplace in past years. The primary competitors for the Volkswagen New
Beetle are the Honda Civic, Fiat, Hyundai. All are included in the same approximate price range and are
comparable for size, safety features and options. Different tests rate one above another on many aspects
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but tend to vary depending on the researchers. The safety of the New Beetle does consistently rate
higher than the competing models. Volkswagen competes with a lot of worthy contenders in the
automobile industry. Everyone has their own spin on value, style and economy and changes in the
There are a lot of cars on the road these days and increasing numbers of accidents so safety is important
as a social responsibility for auto makers. The New Beetle is keeping up to today’s standards and far
surpasses its predecessor on safety features. Energy-absorbing crush zones, pre-tensioning safety belts,
daytime running lights, antilock breaks, dual airbags, and optional side airbags for front-seat passengers
top the list of safety features. The Beetle also scores excellent in the bumper crash-test. New for 2000
are a brake-wear indicator, improved theft protection, and an optional cold-weather package. The New
Beetle also does its part for our society by being economical and efficient. Volkswagen offers a Turbo
Direct Injection diesel engine that gets 48 miles per gallon on the highway. On the environmental side,
the New Beetle is equipped with a CFC-free air-conditioning system. Legally, the Volkswagen is
responsible for doing its part to meet legal requirements in different states.
Distribution/Place Characteristics
The automobile industry is unique from other industries in that many people chose to order vehicles to
their specifications and are willing to wait months for them to arrive. This has been stretched even
farther with the New Beetle. During, and even before, the introduction of the Beetle people put their
names on waiting lists to purchase the car. Some dealerships had waiting lists of over 100 names long
even before the cars were released on the market. People who wanted a silver one would take blue just
to get one. Since then availability has increased although their limited output and the constant demand
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Promotion Characteristics
Historically the Volkswagen Beetle has had one of the greatest ad campaigns in history. The November
12, 1999 issue of the Portland Business Journal states that “The ad, and the work of the ad agency
behind it, changed the very nature of advertising— from the way it’s created to what you see as a
consumer today.” The truth behind the Bug was that it was never meant to be a massive seller. The
company hoped to sell 50,000 New Beetles in 1998 but ended up selling about 74,000. They put the car
on the market to draw attention to the entire line of automobiles that Volkswagen offers. It certainly
a 59 percent increase in sales since the New Beetle’s arrival. People are drawn into the show room to
look at the beetle and stop to take a look at the other models. The excitement the Beetle created spread
among the brand. Volkswagen is using nostalgia to market the New Beetle. The company is investing
$560 million in the advertising campaign for the car putting the spark back into the life of their
company. The new advertisements, much like the old, are very simple. One ad from the 1060s featured
a small picture of the car with the headline “Think small.” Text highlighted the advantages of driving
the small Beetle versus a big car. Overall their ads conveyed a message of frugality and sensibility.
Today’s ads maintain the same simple format but incorporate some more modern techniques such as
original music that is created just for the Volkswagen ads. Lance Mike. Jensen of Arnold
Communications, the advertising firm responsible for the New Beetle’s latest campaign, explains
“People like to feel they’re not of the herd. If a song comes on the air that they know but other people
Price Characteristics
The New Beetle is the most expensive small sedan in America today, but Volkswagen expects a
new generation to discover the bug and be willing to pay for it. The company can still afford this higher
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The New Beetles are manufactured in Mexico in a plant that has a 100,000 – a - year capacity
The car was introduced in Europe but didn’t catch on as well as it did in the United States. In
Europe the Volkswagen Golf is still preferred over the New Beetle although one source stated that the
company may try to introduce a less expensive model of the New Beetle to the European market to see
if it will do better.
Volkswagen Group Japan KK began accepting orders for the Volkswagen new Beetle in June of
1999. The Japanese unit of Volkswagen (originally based out of Germany) is based in Toyohashi, Aichi
Prefecture. This manufacturing group offers two models of the New Beetle with left-hand-drive.
Pending the success of its introduction in Japan, the company plans to branch across Asia.
Internet Opportunities
Volkswagen has the opportunity to follow other car manufacturers in providing its customers the
ability to research vehicle options and order a personalized car over the Internet. Personalizing service
is always good for a company and the more ways for consumers to buy, the better.
Volkswagen does have several web sites that give information about the New Beetle. Everything
from pricing and dealership locations to customer testimonials are available through the web. Due to its
popularity it also receives mention on numerous other sites and I have found it involved in numerous
GM and Ford recently announced their plans to greatly increase the amount of business activity
they conduct on the Internet. It appears that this strategy will help to increase their efficiency and
profitability as well as cutting down their costs by working online with suppliers instead of using face-
to-face encounters. If their strategy works as planned, Volkswagen would do well to follow suite in
capitalizing on the services of the Internet for bettering their business to business activities.
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4. Efficiency of the car is the most important factor when purchase is made.
5. People prefer the foreign car brands because their availability in Indian market.
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Conclusion
The research was carried out regarding the analysis to know the perception of middle class consumer
regarding Volkswagen Beetle in the Indian market. Both the primary and secondary data was collected
for this purpose. By going with the primary data analysis and the SWOT analysis, It can be concluded
that though the Beetle is having its own USPs but it can not do well in the Indian market. First of all the
prize factor is the reason for it. A customer can have a D segment car by paying the same amount as he
is supposed to pay for Beetle. Though it is attractive in nature, but being small sized and lack of inner
space make it lower as we compare it to other cars in this price. So these factors must be kept in mind
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Bibliography
Articles
1. Odgen, Mike. “Top ad campaign of century? VW Beetle, of course.” Portland Business Journal
2. Cisterna, Fred. “Driving music: Volkswagen uses a mix of existing and original tunes to get
Websites
1. http://www.volkswagen.co.in/in/en/products/Beetle.html
2. http://www.netmba.com/marketing/market/analysis/
3. www.angelfire.com/.../New%20Beetle%20Market%20Analysis.pdf
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ANNEXURE
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QUESTIONNAIRE
Dear Sir / Mam, this data collected is just for the research purpose and would not be used for
any other purpose.
Name ………………………………………………..…
Age ……….…
Gender: Male Female
Occupation……………………………………………….
A segment B segment
C segment D segment
2- 5 Lacs 5- 10 Lacs
Safety Efficiency
Comfort Brand
Yes No
Can’t say
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Yes No
Yes No
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