The big news in automotive marketing this week was that Joel Ewanick is leaving Hyundai and going to head up marketing at Nissan. Hyundai won 2009 marketer of the year under Ewanick’s leadership and the company implemented the breakthrough Hyundai Assurance Program.
The Hyundai Assurance Program was a stroke of brilliance at a time when the economy and the auto industry were in a tailspin. It basically gave consumers a no risk way to purchase a vehicle. If you bought a Hyundai and subsequently lost your job, you could return the car, no questions asked. Truly brilliant and it propelled Hyundai through the recession and out the other end. Hyundai’s 2009 sales grew 8% and its share of market was up 1.1 points. This performance earned it elite status as one of only three automobile brands (Kia & Subaru were the others) to increase volume in 2009, while the industry overall declined 21%*.
The Hyundai Assurance Program was an unqualified success in a tough marketing climate. But now what?
Hyundai has a big challenge in front of it. How do you take what was basically a tactic and turn it into a long-term brand equity. The Hyundai Assurance Program gave consumers exactly what they needed when they felt threatened and vulnerable. As the the economy recovers and confidence returns, the Hyundai Assurance Program will lose some of its allure. If you’re not worried about being fired, then you really don’t need the program. Recognizing this, Hyundai extended the Assurance Program basically saying that we’re not out of the woods yet:
Pretty good job of recognizing that this “tactic” needs to be adjusted, but it’s still a just a tactic, a promotion.
Hyundai has done a great job designing, engineering and building quality products. They also have priced them very competitively in the market place. Hyundai has been building a nice business based on terrific quality products at fair prices. Quality products and pricing are the foundation stones of a powerful automotive brand, but the folks at Hyundai are not quite there yet. I think that what they do with the goodwill generated by the Hyundai Assurance Program will determine if they build Hyundai into a brand that occupies a special place in consumers’ minds.
This latest commercial hints at where the brand could go. Imagine if Hyundai could be the automobile brand that “always has your back.” Great products at fair prices and a company that’s looking out for you. There’s a powerful brand promise.
The hard part will be keeping that promise and making delivery against it part of the fabric of the company and its dealers rather than just a promotional offer. If they can do it, Hyundai will become an extraordinary automotive brand that has gone beyond product quality and price to forge an emotional connection with their customers. This emotional connection will differentiate Hyundai and give it remarkable leverage versus Toyota and Nissan. Getting the Assurance Program done was a critical first step, but what Hyundai does next will be telling.
* Sales figures sourced from Automotive News’ Data Center
Tags: advertising, Branding, Hyundai, Kia, marketing, Strategy, subaru
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I think Joel faces a very similar issue at Nissan as at Hyundai. Nissan needs to forge an emotional connection that will differentiate the brand from Toyota, Hyundai, etc. In a way Hyundai was closer to getting that done than Nissan is. Big challenge, but Joel is a talented fellow.
Cameron: Great insights, even better read. What do you think about E-wanick’s exit ??
Cam:
I think you’re onto something with Hyundai becoming the brand that always has your back. They already have the assurance program and an industry-leading warranty. The question becomes, how does this manifest itself in the product, service and other areas of the ownership experience?
Maybe they become the champion of the little guy and develop a special leasing program for small business owners – the men and women who lost their jobs in this economy and decided to start something on their own. They could sponsor the underdog of the week in college basketball. Develop a trade-in program where high mileage, low value models are donated to people who need a car.
Funny thing is, this isn’t too different from the position we carved out for Chevy Trucks in the late ’90s with the “Lean on me” and “Like a rock” campaigns. Unfortunately those manifested themselves only in advertising programs and weren’t used to drive product, promotions, or other facets of the brand.