Branding Suicide - The Big 3 and Family Sedans

By [http://ezinearticles.com/?expert=Ian_Heller]Ian Heller

GM, Ford and Chrysler are struggling with some serious problems due to real and perceived reliability issues, unit labor costs and their obsession with building gas guzzling cars. Those are complex issues involving union contracts, management decisions, government regulations, and consumer perceptions of quality. The Big Three can fairly claim that not all of the associated problems are their fault.

But branding decisions are another story and Detroit has committed a series of bone-headed mistakes that were easily avoidable and clearly the automakers' fault. Some of the most glaring mistakes are in the family sedan category - among the most important models for several manufacturers due to their high sales volumes. The Toyota Camry and the Honda Accord, for example, were the 3rd and 5th best selling vehicles in the US in 2008, with unit sales of 411,000 and 351,000 respectively.

The American automakers have really messed up in this category. Consider Buick, for example. Buick currently makes a couple of models that are very highly regarded in the automotive press for their quality, fit and finish, nice interiors and sophisticated drivetrains. The problem is, most consumers have never heard of these models because Buick created new brand names for them--the "Lucerne" and the "Lacrosse." Why create new names? My guess is that the branding "experts" at Buick or elsewhere in GM decided that Buick's old car nameplates were too "dated" and had too much negative brand equity. So, instead of using names long associated with Buick, like the Park Avenue, the LeSabre or the Century, they changed to new brand new names for the updated models.

Problem #1: GM doesn't have the cash to launch new models properly, so the vast majority of consumers are unaware of the new nameplates.

Problem #2: The Buick Century and LeSabre recently won awards for reliability from JD Power - accompanied by the message that these models are no longer in production. Ouch.

And yet these models actually are still in production - they just have new names. The Lucerne is a replacement both for the Park Avenue and the LeSabre while the LaCrosse replaces the Century. How many car buyers know that or will do the research to find out? Not many, so the PR effect of the JD Powers awards is nullified.

Ford isn't any better. At one time, the Ford Taurus was the best-selling car in America. Ford didn't invest in the model and it became uncompetitive with the class leaders, the Honda Accord and the Toyota Camry. Instead of investing to rehabilitate the brand, Ford killed it off and renamed its successor, the "Fusion."

The Fusion is a great car; it's well-engineered, safe, well-appointed and very well-built. The problem for Ford is that it has very low brand awareness because the name is new to the market and, like Buick, Ford doesn't have the money to advertise it sufficiently.

At about the same time they introduced the Fusion, Ford also introduced a new, larger car, which it chose to call the "500," a moniker it used on a series of vehicles from the 50's to the early 70's. This is also a good car and one of the safest vehicles on the road. Again, Ford didn't have the money to build awareness for the 500 and there's no "halo effect" from a 40 year recycled brand name, so sales were awful.

To address this dilemma, Ford chose the curious route of renaming the 500 the "Taurus," even though it's in a different class of automobile than the old Taurus ever was (the new one is a lot bigger). The Fusion - which was the actual replacement for the old Taurus - keeps its name. So, if you are familiar with the historical "Taurus," the new one doesn't match your mind's image of it. If you are looking for the latest Ford vehicle that competes with the Accord and the Camry, then you want a Fusion - a model about which you probably know very little.

Buyers seeking a family sedan don't have to expend any energy figuring out what Toyota or Honda models are intended for them - nearly everyone knows about the Camry and Accord. If you want to find the equivalents from the Big 3, you get to choose from the Fusion (not well known), the Buick LaCrosse (unknown) the Chrysler Sebring (a name best known for its convertible, two-door model, not the four door sedan) or the Chevy Malibu (better known but relatively unsupported with advertising).

Just based on brand naming strategy, guess who's winning the family sedan wars?

I mentioned at the top of this post that the Camry and Accord were the third and fifth best-selling models in the US in 2008. Curious about the models that round out the top 5? The best selling vehicle of all was the venerable Ford F150 pickup truck, followed by its direct competitor, the Chevy Silverado. Fourth place went to the Honda Civic, meaning all five top spots went to nameplates that have been around for several decades.

Armed with that knowledge, what could have possibly compelled the Big 3 to kill off their family sedan nameplates? I think it was "branding suicide," and illustrates just one more way Detroit has dug itself into a very deep hole indeed.

This article is also available at http://realresultsmarketing.com/2008/12/branding-suicide-the-big-3-and-family-sedans/

Ian G. Heller is the founder and senior partner at Real Results Marketing, Inc. With senior executive experience at companies like GE Capital and Grainger, CEO experience at a private-equity owned firm and countless consulting engagements, Ian brings a realistic and bottom-line focus to marketing and strategic planning. Please visit http://www.RealResultsMarketing.com for engaging videos and articles on marketing, strategic planning, leadership and more.

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