Posts Tagged ‘Chrysler’

On the cusp of……slipping the needle in.

Monday, December 9th, 2013

Last week the auto industry reported US sales and what a great report it was!  Just scan the headlines:

“Out of the Doldrums, Automakers Post Strong U.S. Sales.”  –New York Times 12/3/13

“Brisk Demand Lifts Car Sales”  –Wall Street Journal 12/4/13

“Auto Sales for November Hit Fastest Pace in Almost Seven Years…Industry Bullish on Growth”    –AdAge 12/3/13

“Industry rides toward 2014 on a high” Automotive News 12/3/13

“Strong US sales boost Detroit Three Car Makers”Financial Times 12/3/13

Just this morning Automotive News reported:

“Likely from Santa: Soaring SAAR for December, big ’14”

So the march out of the recession continues for the auto industry, some forecasters are even predicting that in 2014 the industry could retail 17MM units again.  Forgive me, but I find these predictions a bit unsettling. I’ve seen the boom and bust of cycle of the industry a few times and each time we go through it, I quietly say to myself, “Ok now we’ve learned our lesson.”

It was just a few years ago that the country was thrown into the worst recession most of us can remember. Auto industry sales collapsed to 10.4MM units in 2009 and Chrysler and GM went through bankruptcy. Bankruptcy gave the domestic manufacturers an historic opportunity to rid themselves of excess production capacity and correct one of the industry’s long term bugaboos, we were simply making more cars than people wanted to buy.  Too much production led to inflated inventories which in turn led to marketing that relied heavily on incentives and made price virtually the only criterium for purchase. We taught consumers to ‘buy the deal.’ Promotions are a necessary part of any business and there will always be times when incentives need to be used, but using incentives became the SOP of the industry (particularly the domestics) and made it impossible for anyone to make money.

For the last couple of years, with the recession just behind us, the industry has shown restraint. Production and inventories were kept under tight control, fewer incentives were used and low and behold, margins increased! This has been great for the industry and things are really on firmer footing than anytime in recent memory.

But, will the industry become a victim of its own success……again?! (more…)

Super Bowl XLV–Will the auto industry carry the day?

Wednesday, January 26th, 2011

Last year, I asked the same question and I think the answer was “no.”

Audi’s terrific A3 TDI commercial led the automotive pack, ranked 6th of 65 by USAToday but all the others were also-rans. Here’s how the automotive participants ranked in last year’s advertising beauty contest:

A dismal showing by the auto industry.  Despite being one of the highest interest product categories with some often fantastic products, we seem to be unable to captivate the Super Bowl audience.

To be clear, getting highly ranked in USAToday’s poll has nothing to do with judging a TV commercial’s effectiveness, it simply is a measure of a panel of consumers’ reactions and “how much they liked each ad.”  But it is without question, ‘the game within the game.’  As a Super Bowl advertiser you spend $3MM or so for 30 seconds and the chance to get noticed and liked. It’s an opportunity to get tongues around the world wagging about your ad, your brand and maybe even your products.

But to make that happen, you have to do something amazing. (more…)

2011 Jeep Grand Cherokee: “Imagined, drawn, carved, stamped, hewn and forged here in America.” Sort of.

Monday, July 12th, 2010

Jeep is introducing the 2011 Grand Cherokee and it seems it is quite a vehicle:

“The newest generation of Jeep’s iconic luxury SUV can still rock-crawl with the best of them, but it looks a whole lot nicer doing it, both inside and out.”  AutoWeek  7/5/10

The new advertising is impressive and seeks to re-invigorate some distinctly American values:

Let’s face it, as Americans we are feeling a little down.  The worst recession in generations is a big part of the problem.  Nagging unemployment, a recovery that is sputtering and concern over the looming deficit are not helping.

So I think Jeep’s strategy of appealing to values we all hold dear makes some sense. What American isn’t proud of our heritage as a “nation of builders, craftsmen, men and women for whom straight stitches and clean welds are a matter of pride.”  We built the railroads, invented the airplane, built the Empire State Building, and created the original Jeep.

The idea that “the things that make us American are the things we make” strikes an emotional cord.  A cord that makes us feel proud, and right now a little pride would help.  The Jeep Grand Cherokee is something we can all be proud of because it was “imagined, drawn, carved, stamped, hewn and forged here in America.”

Powerful stuff, beautifully executed, leaves the viewer saying “yeah, bring it on.”

Only two things bother me about this commercial. (more…)

Super Bowl XLIV: Which automotive manufacturer got it done?

Monday, February 8th, 2010

The sentimental favorites won the Super Bowl…at least the football game part.

Generally speaking I thought the advertising game within the game was just OK, not great.  Within the automotive segment, six manufacturers stepped up for the Super Bowl:

As I said in an earlier post, the tough part about advertising in the Super Bowl is that while the football game is the primary draw, the advertising contest comes in a close second.  As an advertiser you have to be willing to do work that will stand out and entertain because the very next day the “results” of the ad contest will be published in USAToday.

I always watch the Super Bowl hoping that one or more of the automobile manufacturers will break out of the category mold and amaze us.  Here’s my take on the automotive commercials, from best to worst:   (more…)

Looking for a new agency partner? 8 critical things auto manufacturers should consider.

Tuesday, September 15th, 2009

bw_200x42

The following article first appeared in BusinessWeek’s “Brand New Day” blog on September 7, 2009

Volkswagen has announced that it is looking for a new advertising/communications partner.  Chrysler has just announced that they are considering non-roster agencies for projects.  Bob Lutz at GM has said that the agencies for the remaining GM brands have six months to demonstrate that they have the chops to remain part of GM’s stable of agencies.  A rash of car companies re-evaluating their agency partners.

So what should these companies, or for that matter any automotive manufacturer, look for in an agency?

The next five years are going to be the most competitive in a generation.  The “new normal” annual sales volume for the US will be 14-16MM units, nowhere near the 18MM the market achieved a few years ago, let alone the 20MM+ some forecasters anticipated.   The “new normal” is a mature market where the fight for share will be intense, the risk of commoditization ever present and the winners will be those companies who recognize that the only thing standing between them and commodity status is terrific product and a carefully crafted brand reputation.

The “winners” will be those companies with clearly differentiated brands.  Those companies that make establishing and/or nurturing their brands a priority will see their share of market grow, those who focus only on retail will be treated like commodities.  Automobile manufacturers do need agencies that can manage the retail side of the business but more than ever they need to take brand building seriously.

So here are some suggestions on what to look for in an agency:

1. An agency must demonstrate the ability to build a brand over the long term. Look for relationships and case histories that span years not months.  Look for strategic consistency that is grounded in a deep understanding of the client and its customers.  Make sure that knowledge turns into core values that form the bedrock of the brand’s communications.  Look for the “red thread” that holds all the work together.  Ask 2nd and 3rd level questions about the company and its brand.

(more…)