Sunday, November 30, 2008

The Ultimate Build & Price Machine

BMW has developed, jointly with Microsoft, a new build & price configurator that allows potential customers to drag and drop vehicle choices using a large iPhone like touch screen. There is one screen that acts like a canvas, similar to the film Minority Report, and a second screen that displays the configured vehicle in an emotional way through video and rich photographic content. It's a pretty nice implementation, though it is not portable; however, components could be used to improve online build & price implementations - particularly the emotional content when the vehicle is fully configured. Imagine having a vehicle, exactly like the one you just built, driving along the autobahn. more.

Tuesday, November 25, 2008

Fueling Sales: Beyond MPG Numbers

The race to prove one’s superiority is on in 2008 and is sure to continue into 2009, even as gasoline prices fall significantly. The idea that $4 gas is possible is in the mind of the consumer and it has changed the perspective on what is important in the purchasing decision. Fuel economy is now even with safety and quality when it comes to leading factors when buying a car.

So now that fuel economy is a major influencer, how are the automakers responding to this change? Product changes take years in manufacturing leaving marketing with the brunt of this task. You have to sell the products that simply exist. There is no silver bullet to improve fuel economy in a matter months.

One issue becomes obvious very quickly, most non-hybrid cars have similar fuel economy numbers, provided they are the same class of engine (4, 6 or 8 cylinder.) A lineup of 4-cylinder sedans have pretty much the same mpg numbers within 1-3 mpg, leaving marketers with little competitive advantage in the mpg distinction. A couple ways companies have dealt with this dilemma are as follows.

One approach is to show dominance by using miles superiority on a tank of gas. The new Chevy Traverse launch site does this using a PowerPoint graphic. The Traverse gets consumers another 60 miles in driving range before a refuel when compared to its competitors, yet it has the same fuel economy as the Ford Flex and Toyota Highlander. How does it do this? Through the magic of a bigger fuel tank. Never in my wildest dreams did I think the size of a fuel tank would be used to show a competitive advantage in fuel economy. To hell with logic, Chevy just bolted on a bigger tank to the frame. Advantage Traverse! Or something like that.

Chevy isn’t alone in this approach. In the UK, the Smart car competes with several small compact fuel sippers and decided to use driving range as a differentiator for the ForTwo model. Fortunately, Smart uses a more whimsical approach by letting the site visitor choose the correct answer of how far the Smart can travel. They even bring in a bagpipe player to celebrate the news.

Another approach is Honda’s Fit online game experience. This one is really odd. The concept here is to show the Honda Fit as a “a hero of fuel efficiency” by pitting it against the “Fuelivors”. Fuelivors are represented as big, old, inefficient American cars. Though this isn’t a challenge against a Chrysler Sebring, Chevy Cobalt, or Ford Focus. No that would be a fairly even match; instead, Honda brings us back to 1960 American big cars, complete with fins and giant grilles. Too bad online games weren’t around during the 1970s gas crisis as the Honda Fit game would’ve been a perfect fit.

There really hasn’t been a great approach yet to differentiate on fuel economy, unless of course you are a hybrid – the Prius hybrid. In the non-hybrid category, there may be some opportunity to find a way to extend fuel economy beyond just mpg numbers. Besides fighting 1960 Impalas or having a larger fuel tank, product is what gives you a competitive advantage in fuel economy, marketing less so.

Giant Red Bow Sales to Nosedive this Christmas

Automotive advertising is definitely going to decrease in the coming months and possibly years. One of the changes happening in Christmas 2008 is a decrease of the buy a car for your loved one Christmas ads, most commonly associated with Lexus. The big red bow car ads will be replaced by less ostentatious messaging.

Honda will be extending their TV spots with online media placements that will donate $1 to charity for every registration on their site. It's the softer, community approach that will be more common this year than the overtly festive approach of prior holiday sales events.

With sales numbers way down across the industry, Honda's strategy of getting hand-raisers to communicate to via a charitable gift enticement could be a good way to obtain leads as the economy recovers.

This is disappointing news as I was hoping Santa would bring me a new car for Christmas (I always ask, never receive.) Oh well, it's a time to be thankful for what you have, not what you want. Maybe I'll just ask for some new micro-fiber towels to wash what I own. more.

Thursday, November 20, 2008

Some of My Work Debuted Yesterday

It's a great time to work with Ford, Lincoln and Mercury. This is a time of new distinctive design and high fuel economy vehicles as Ford adjusts to the changing market. That's why it was an exciting day yesterday when three vehicles I worked on debuted at the LA Auto Show, followed by three vehicle reveal websites. Two major launches included the new Ford Fusion + Fusion Hybrid and the Lincoln MKZ. We also developed some content to reveal the new Mercury Milan & Milan Hybrid. All the distraction of the industry aside, these are some solid products with major updates to their interiors, improved fuel economy, and the addition of a couple hybrid sedans.

Since this is some of my work, I'll just let it speak for itself as I really cannot get into much about the strategic decisions without divulging proprietary information, so my apologies. I do think there is some beautiful work but I did learn a few things that I look forward to improving as we look to the Detroit Auto Show in January and what's to come then.

Saturday, November 15, 2008

Advocacy Marketing… Begging for Billions

It is an ugly time in the automotive industry. So bad, that even the beloved Toyota is down 23% last month. A lot is changing in the U.S. (and global) economy and it is hitting the Big Three (GM, Ford and Chrysler) and international automakers hard. Unfortunately, like the U.S. consumer, the Big Three are highly leveraged and spending more than they bring in. The financial crisis is hurting U.S. automakers two fold: in higher lending rates as they borrow to keep operations going and secondly in the ability of customers to get credit approval. One of the big issues that is exacerbating the sales decline in automotive is the new lending standards forcing many borderline or less-than-perfect borrowers out of the market. The whole lending industry is in a giant stalemate as banks continue to suffer large write-downs of bad debt when just a year ago they were lending hundreds of thousands of dollars to anyone with a pulse, forget proving you had an income or could rub two nickels together. So, here we are in one of the worst global financial crisises since the Great Depression.

The Big Three are currently pushing the public for a government bailout between $25-$50 billion. This is suppose to buy the automakers sometime while the banks eventually relax their lending standards; thereby, allowing more buyers into the market. Buying time will not quickly turn Hummers into Priuses; instead, this is about giving the industry cash to continue operations in an environment that has stopped lending to firms with bad balance sheets, and yes all three U.S. automakers have some pretty dismal balance sheets.

Without going much more into what the situation is from an economic or political perspective, I want to look at what the Big Three are doing from a marketing perspective. Instead of our usual topic of selling products, GM and Chrysler are doing advocacy marketing through two online efforts: GM Facts and Fiction, Chrysler’s Corporate Blog and Grab Democracy By the Horns.

Chrysler’s Blog

Chrysler has started posting some of their corporate blog content on YouTube and they maintain a blog off of their Chrysler Listens website. The videos advocating support for a government bailout are almost laughable. Autoblog chastised Chysler for “breaking out the handycam” as the videos reek of amateur corporate training video quality. The voiceover and pictures of Washington DC, a flag in a factory, and random ‘action shots’ inside corporate headquarters I’m sure is something the employees of Chrysler were forced to watch. Really, who would watch this unless someone was paying you? (Oh wait, I watched them and no one is paying me right now… hmmm better rerun my MSN Time Valuation Calculator.) Unfortunately, the Chrysler advocacy videos probably won’t budge the political debate in the Big Three’s direction. Then again maybe I’m wrong, maybe Chrysler’s low budget approach just makes you feel sorry for them. Yeah, I’m right. It does nothing.

The new effort is a bit more consumer friendly, Grab Democracy By the Horns. Really? Grab Democracy by the Horns? Are we supposed to wrestle democracy down to the ground with a lasso and tell it to fork over some of those billions? Worst Website Name Award aside, the site is a bit more advocacy friendly than the Chrysler corporate blog. Unfortunately, it must be a work in-progress as several of the links are not working. For example, apparently no one has "Shared Your Story." Supposedly, people are to share their woes of being a private equity fund and the pain of a bad investment in the auto industry.

GM Facts and Fiction

I have to admit I love it when GM creates new websites to stay engaged with consumers and brand advocates, like they have done with their Fastlane Blog, or when they have tried to redefine the energy debate with their GM Next website.

GM is out on the Internet trying to actively define issues and GM Facts and Fiction is no exception. The homepage of the site calls visitors to action with their “Mobilize Now” and “Get the Word Out” action links. The Mobilize Now section actually categorizes a user’s own advocacy by the type of person they are. For instance, if you are a retiree, you get a custom letter to send to your congressperson. Employees, suppliers, dealers, and my personal favorite “Concerned Americans” all have form letters or phone statements prepared by GM to show support for a bailout.

The site also provides several Myth and Fact statements and a Learn More About the Crisis page that links out to several articles, polls, et cetera that show third-party data and information about the auto industry’s current situation and how a bailout would help America, not just GM. It is an interesting approach and one that is significantly better than the corporate video route Chrysler is taking. GM feels it can best educate it’s advocates through knowledge and defense against some of the “myths” it feels are currently clouding the debate. Much like any political discussion, GM is using Facts and Fiction as a tool to improve advocacy by improving the insight of those supporting the bailout or by convincing those on the fence that the bailout is a good thing for all Americans.

Social Media

There is even a social networking angle that popped up on my Facebook profile this evening. Someone from Digitas (GM’s digital agency of record) started a Cause group called “Support the US Economy by Supporting the US Auto Industry”. Most of us who have joined are there for self-interest, I’m sure. It is, however, an interesting way to get the word out across social networks and may even drive some traffic to GM Facts and Fiction, which is prominently featured on the Facebook Cause page.

What About Ford?

So where is Ford in the Big Three advocacy play? They have decided to opt out and focus on future product as evidenced by this recent article in The Detroit News. Ford is trying to play this one under the radar. They definitely want aid and some reports have said they have maybe 7 months of cash to burn through before having the same issue as GM, but Alan Mullaly wants to show that Ford is a healthy company and just wants aid as a matter of fairness if his cross-town rivals get any help, i.e. why should GM and Chrysler get any competitive advantage through lower lending rates or cash availability.

In Closing

Advocacy marketing, when three giants of U.S. industry are seeking billions in government aid, is not an easy thing to sell to a citizenry that is seeing historical foreclosure rates, rising personal bankruptcies, and a very shaky job market in just about every industry. This leaves a lot of Americans with the question: Why GM, Chrysler, and Ford? Why not the company I work for or own? What makes their need for stability and survivability any greater than mine? Unfortunately, that question never gets directly addressed by GM’s or Chrysler’s advocacy websites. Why? Because the reality is a lot of jobs are unstable today and a lot of businesses would love some government aid in a time of dire need. The good news for the Big Three is that the debate is falling more and more in their favor with some recent polls suggesting there is support for a Big Three bailout. Now if only congress and a lame duck President can come to some agreement before GM starts bouncing checks next month…

Thursday, November 6, 2008

When Your "Best Side" Is Under the Hood... You're Ugly

There have been numerous debates about how to properly advertise a car. Some of the most infamous include Infiniti's debut campaign that never showed a vehicle or when Range Rover took a "risk" showing a vehicle caked with mud, at a time when every vehicle was always shown as if it just rolled off the showroom. But I have never seen an advertisement that shows only the engine cover as its beauty shot. Enter the Kia Sorento. While reading the NY Times this evening, I noticed a rather puzzling shot of an engine block cover to the right of the article. Having removed an engine cover or two in my past, I knew what it was. But I doubt most people do, since very few of us open the hood of our cars.

There is no call to action or no message surrounding the engine cover image. Instead, just a price and the vehicle's name. I wonder if many people would even know it was an advertisement for a car? On rollover, a message about the vehicle's horsepower is given. But is this for a car, truck, SUV, or crossover??? I doubt the click through rate on this ad is very high. It is being advertised in an upper funnel spot, outside of an automotive context, with an image that resembles the chest plate of some futuristic robot or some really expensive lawn mower.

When advertising outside of an in-market automotive context, it is best to engage and interest the consumer, but to do so in a way that communicates who you are or gets them interested in what you are saying. A stale image of an engine cover with no engaging copy is the worst thing you can do. Kia has a compelling, low-price 5 passenger SUV in the Sorento that could be much better communicated to a large audience. It's a value product in an financially conscious time, so sell it on it's merits as a good buy without giving anything up (like moving to a small car for example.) Performance is not the Sorento's segment advantage or the care of most 5-passenger SUV consumers: value, versatility, and roominess are. So promote it in a way that interests a larger audience.

Maybe when the Kia Soul gets released will Kia finally show a vehicle from outside its engine bay.

Wednesday, November 5, 2008

Consonants HGTV and GMC Team Up for Some Nice Content Integration

Reaching your consumers through natural pathing is a goal of all advertisers. If there is one mantra I have come to use in online marketing that’s go to where your customers already are. There are many examples of advertisers, across industries, trying to build their own Facebook, their own Snapfish, or their own YouTube. There are also a lot of ideas out there right now trying to gain inclusion in people’s social networks. While all of this is important to evaluate when developing an online brand experience, one of the better ideas in online media has seemed to lost its cache and that is online content integration. I finally came across a good example from a recent email marketing newsletter sent to me by GMC.

GMC Trade Secrets on AOL Living brings together useful consumer content relevant to the passion points of its potential customers. The execution also brings in some HGTV celebrities: Eric Stromer, Kelly Edwards, and Curtis Stone. The AOL Living section provides some rich DIY content that was developed custom for this site and not just a repurpose of content. My favorite was “Fix Driveway Stains” a nice integration of automotive relevancy and homeowner tip that currently has over 800,000 views.

Some nice touches include the “Get Weekly Updates from the GMC Pros” email hand-raiser. GMC requests some information about vehicles people would be interested in, plus timeframe when they may be in-market, but it also lets the user Skip the form and just sign up for the Pros' email content. GMC is respectful that all of the visitors may not be interested in the vehicles so the Skip button is prominent.

The site also includes an Ask the Pros section under every video. Unfortunately, like a lot of content sites like this the replies to questions asked are non-existent. People left a lot of questions on the site but it seemed only about 1 in every 8 had a response; though, the response was typically from another user of the site, not the Pro.

Overall the site really meets the homeowner, do-it-yourselfer at a level that is worthy of their time. Even with all of the GMC ad banners on top and along the margins, the site features the Pro content without overly pushing GMC in an obnoxious way. Sure there is some quick pre-roll of the Pros driving a GMC vehicle before a video tip is given but at least it uses the Pro in the pre-roll and isn’t a 15 second GMC ad.