Lousy Marketing -- Not Lousy Cars -- Killed Detroit
Long before the CEOs of the Big Three hopped aboard their private jets, they presided over the biggest marketing failure in American history.
Many miles ago, long before Detroit started losing billions a month, it lost something even more important: its roadmap to the American unconscious.
So while we've heard all the arguments for the impending demise, it's high time we took Detroit's slow-motion suicide for what it is: a marketing failure, probably the biggest one in history. It takes years of monumental incompetence to squander the biggest, deepest love affair the American consumer has ever had.
I wasn't surprised when Detroit's million-dollar men cranked up their corporate jets on Friday, popping warm nuts while strategizing about how to land some cold cash.
That 360-horsepower blunder--which may very well have sealed the fate of the Big Three--capped off decades of marketing incompetence.
Car companies have so many levels of creative approval that even a crash dummy would have trouble surviving the process.
The image destruction started when their brands began to exhibit the worst kind of corporatist behavior, summoning up dark memories of the tobacco industry. They battled against every safety initiative, starting with mandatory seat belts. They tried to beat back higher CAFE standards. They lobbied against electric cars and alternative fuel.
As consumers were increasingly making purchase decisions based on the practices of the company behind the product, the domestic auto industry became a loathsome choice.
Detroit's bad actions hurt it with a huge part of the market--the more than 30 million people in Richard Florida's "Creative Class" who work with ideas, live in urban areas, and are more progressive. Even the more traditional consumers who stuck with American cars felt abandoned.
The jerks running the companies didn't help. Your CEO is a marketing statement, and in an era of visionary leaders celebrated by the media--other than Lee Iacocca, who retired in 1979--the guys running the show were overcompensated, colorless zeroes.
From 1974 through 2000, GM was piloted by Tom Murphy, Roger Smith, Bob Stempel, and John Smith, failures whose names are recalled only as poster guys for deck-chair rearrangement.
As these weak-kneed leaders came under pressure for their practices and products, they turned psychologically inward. It all culminated with Michael Moore's Roger and Me in 1989, a national display of corporate paranoia. An industry whose birthright was independence came to represent villainous bureaucracy.
And in a colossal marketing mistake that scraped away any chance for individuality, Detroit's legions of PR firms continued to let its brands be bundled as the Big Three. Can you imagine Apple permitting itself to be bundled with Dell and HP this way?
Ironically, though, as its reputation plummeted, Detroit's cars actually improved. The Detroit Free Press notes that Consumer Reports recently found that "Ford's reliability is now on par with good Japanese automakers." And J.D. Power ranked Buick, Cadillac, Chevrolet, Ford, GMC, Mercury, Pontiac, and Lincoln brands' overall quality as high or higher than that of Acura, Audi, BMW, Honda, Nissan, and Volvo.
This is an epic advertising failure, attributable to Detroit's stubbornness and arrogance. The Big Three kept working with a small group of the biggest and most boring ad agencies, refusing, until recently, to work with anyone who didn't have car experience. Leo Burnett has worked with GM since the 1930s; J. Walter Thompson has worked with Ford for more than 60 years.
I've worked in advertising for a while--thankfully, never on a car account. And I will tell you that it's well-known in the industry that working with Detroit is torture. The Big Three's demand for mediocrity is legendary. They have formulaic rules--the "running shot" of the car has to be a certain length in every commercial--and they have so many levels of creative approval that even a crash dummy would have trouble surviving the process intact.
That's why, even though GM, Ford, and Chrysler spend more than $6 billion a year in advertising, it's tough to conjure up a single memorable spot. Their uninspiring advertising speaks to an America that barely exists anymore. We're more diverse, more urban, more media savvy. We appreciate irony and obliqueness, we demand that our sensibilities be respected and indulged. Detroit insults us.
Take this 2008 commercial for the Dodge Grand Caravan. (The way Detroit names its cars--with all the originality of meeting rooms at a Westin--is another story.) Here, some reluctant participants at a family reunion are transformed in a beatific bunch by a ride in the Caravan. (Not exactly the imagination worthy of a bailout.)
Detroit should have sought the best talent in the world. It needed to open up to smaller, independent agencies that are the idea factories for the industry. And it should have commissioned film directors, not car hacks, to direct its spots. It happens in Europe all the time. Turn Judd Apatow, Spike Lee, Spike Jonze, and Michael Gondry loose and see what happens.
I've also believed that smart marketing could have turned Detroit's union hurt into an emotional benefit. It's absolutely amazing to me that for decades, Detroit took the heat for paying decent wages and providing health care and pensions. Hey, isn't that what big companies are supposed to do? Hasn't Wal-Mart been pilloried for precisely the opposite?
Imagine if Detroit had created compelling advertising that showed its workers living the American dream, and had gotten the UAW to pitch in? The sweet stroke of marketing would have made everyone who drives a domestic car feel virtuous, ennobled. Think how much credit Starbucks gets for paying its coffee growers a few measly cents extra.
Finally, Detroit's marketing failure extends all the way to your neighborhood: the dealership network. The retail industry knows that to survive, it needs to amp up the experience and add entertainment. But car dealerships look like post-apocalyptic empty shells that survived a neutron bomb.
Why didn't Detroit push its fat and rich dealers to leverage the power of architecture and hire Frank Gehry to create a new paradigm? Think about the branding statement that would be.
The services leave something to be desired, too, falling alarmingly short of what you get in comparable imported dealerships. Quick example: I checked the hours of my local Buick and VW dealers. Buick's service department is closed on Saturday; how thoughtful of them. VW is open on Saturday, and also opens earlier and closes later during the week.
Seems like a basic marketing equation to me: If you're not going to be there for your customer, your customers won't be there for you.
Adam Hanft is a decoder of the consumer culture and our branded planet. He blogs for The Huffington Post and FastCompany.com, and has been published extensively, including in The Wall Street Journal, Slate, Civilization, Radar, and the back-page column for Inc. He has appeared on CNN, the Today show, and many other media outlets. He is also the co-author of Dictionary of the Future. Adam also decodes the culture as founder and CEO of the marketing and branding firm Hanft Raboy.
This piece appeared in the Daily Beast on November 24th, 2008.
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I just downloaded the new Ford Fusion/Hybrid commercial. It gave NO "buy me " message. Worse, there was little to no information as to why I might want one.
But there was a lot of computer generated zoom in and out shots with 3-D rotational graphics. The was no information about the power plant outside of... "under 47 mph, the engine never(?) runs. Over 47 mph, the engine runs and you get up to 41 mpg."'
As an old retired ad man... art and creative directors, I find Ford's latest commercial appalling. The feature highlighted the most was the speedometer?! You fools NEED to go out of business.
You are completely wrong if you think Detroit's problems would be resolved by better marketing. That is only lipstick on the pig... It is not simply HOW they advertise; it is WHAT they have to advertise. I don't care if Spike Lee or the ghost of Alfred Hitchcock directs a commercial showing an SUV Hybrid boastfully getting 18 miles to a gallon, Detroit misses the mark. Show me a crappy, boring commercial of an SUV electric hybrid that gets 200 miles per charge, and I'll buy the car and Detroit will on the right track. The problem IS the glitzy, snappy ads that make the crappy cars look desirable, People are not stupid. You got it backwards.
RIGHT ON ! MARKETING WAS INDEED THE FAILURE. YOU OMITTED THE BASIC REASON FOR THE FAILURE. THE TRADITION OF GM FROM THE VERY BEGINNING WAS TO SELECT A CEO FROM EITHER MARKETING OR MANUFACTURING, tHE FIRST FINANCIAL MAN ELEVATED TO THIS POSITION WAS TOM MURPHY. SINCE THAT TIME EVERY CEO CAME FROM THE STAID RANKS OF CPA'S. EVER SINCE THAT FATEFUL APPOINTMENT AND THE SUCCEEDING ARMY OF ACCOUNTANTS GM'S MARKET SHARE HAS DECLINED, TO LOSE MARKET SHARE TO A BUNCH OF JAPANESE BOXES ON WHEELS COULD ONLY BE ACCOMPLISHED BY ACCOUNTANTS
On the third line of your post I can see a lowercase "t", so you are not stuck in some "caps lock" universe. Why type you entire message in capital letters ? It's not only more difficult to read, but as you surely must know, capitals is considered rude because it's the internet equivalent of SHOUTING !
In this world of greed and lobbying, doesn't anyone believe that some $$ changed hands between the oil industry and detroit?? I'm sure this happened, yet I've never heard anyone mention this as a possibility! Why else would american auto makers make these gas-guzzling junks (sorry, quality is lacking) all these years??
Better marketing WILL NOT SELL THEIR CRAP. . . . Me, my family, and everyone I know HATE
Detroit cars. Back in the 50's when foreign was not all that common - we all owned Detroit cars.
If you made the mistake of trying to drive one past 30 months, then your monthly repair bills were HIGHER THAN YOUR PAYMENT. Not to mention all the time in the shop.
Detroit made crap with a short shelf life ON PURPOSE so we were forced to keep buying a new product just to stay out of the repair shop.
When Japan began giving us great cars, THAT DIDN'T FALL APART BEFORE IT WAS PAID FOR
we all bought them as fast as possible, and been doing it ever since. I will never own a Detroit
car - - - no matter what.
Their reputation is not poor marketing skills
- - - - - - IT'S FREAKING POOR DESIGN AND MANUFACTURING SKILLS.
Very well said.
Seems there is a "best before" date on American autos. Japanese or German may cost more but in the long run you actually save money, not even talking about wasted time and frustration when the car is in repair.
"They battled against every safety initiative, starting with mandatory seat belts. They tried to beat back higher CAFE standards. They lobbied against electric cars and alternative fuel."
What exactly makes anybody think that all of a sudden these people can become a force for progress and leadership despite a 40 year history of the above? They are the prime enabler of the neocon foreign policy philosophy - which is simply that American must secure the flow of oil from the Middle East by military means and establish a permanent military presence in the Middle East to do so. Without the big three auto companies actions - making the giant SUV the centerpiece product of their line, killing alternative fuel vehicle development, perpetuating the narrative that alternative fueled vehicles are for environmental whackos and not for "regular americans" - there could be no neocons, no 9/11, no Iraq war. And now we are to rescue them because they write up a 40 page business plan saying now they're on our side this week?
On a personal note, I own 2 cars - a Jeep and and an Acura. I could have written a book with all the free time I've spent in service department waiting rooms waiting for part replacement and repair on the Jeep. Defective mirrors, bumpers rusting and falling off, air conditioning failed twice, 4 wheel drive system replaced, defrosters replaced front and back, heating system stopped working, etc. etc. The Acura? 60,000 miles so far and nothing but
Oh, please! The crappy cars they designed and manufactured helped quite a bit in the demise of Detroit. I owned a Dodge Neon for two years in the late 90's. I traded it in halfway through the loan for a foreign car even though it hiked my payment. I was tired of breaking down miles from home and shelling out 500 bucks for repairs every other month. That was the first and last American car I'll ever own.
The Japanese and Germans beat the crap out of Americans in design, innovation, quality, and supplying demand. While the Big 3 were pushing Expeditions and Hummers, Toyota and Honda kept chugging along with their high mileage compacts and reliable sedans. They gave us hybrids while Detroit gave us, bigger SUVs and fought CAFE standards.
A marketing campaign is not going to fix this. You'd never see the CEO's in Japan or Germany begging for money from their governing bodies after flying in on private jets. If they fail, they don't get bonuses or handouts, they get fired. No, Detroit has to grow up and change, only then will it have a chance.
As I've said before, a few years back I came up with a business plan that wouldn't "save" any or all of the big three, it would surpass their wildest dreams. They are masters of snatching defeat from the jaws of victory. Hell, any of you automakers ever read this, I'm still here, and I know it will work because it's worked before. They have all of the tools needed to surprise the car buying audience. They have the willpower, the brand recognizition, but they have not a clue. This is not the 1960's. I drive by a Chevy poster proclaiming "now getting 34mpg" while I get 40mpg in a GM product... from 1990!! (Saturn SL1)
We used to live a few kilometers from the Nissan assembly plant near Zama, Japan. We would see truck after truck bringing components to the immaculate facility. Once we followed one of these trucks back to the component manufacturer. Huge clouds of smoke were drifting out the doors and oily pollution ran in an open ditch. The scene was straight from the early days of the industrial revolution.
Another thing we noticed was that the Japanese wrecking yards were stacked with cars that appeared to be in great shape. The Japanese government and automakers have colluded to make it economically infeasible for the Japanese consumer to keep a car more than 5 years old. Each year the mandatory inspection fees rise until it's cheaper to get a new vehicle.
"Each year the mandatory inspection fees rise until it's cheaper to get a new vehicle."
What evidence do you base this upon? That statement would seem to be countered by this evidence.
The average age of a car in Japan has risen to 6.77 years from 5.05 years over the past decade, the Japan Automobile Manufacturers Assn. says.
http://www
I don't suppose you work for GM do you?
Yes all this is true, but it is also the cars. Nothing for customers under 50. The design are abominations. Inexpensive means cheap materials and sloppy fit an finish. You would think they would have learned what tradition and formula did to the British and and motorcycle industries in the 70's. It made them ultimately extinct except for the logos. Though their marketing has been more effective as a "lifestyle" fashion. Harley-Davidson is going down the same road. A one design product with no appeal to the younger consumer. How can any CEO ignore the next generation of customers?
"To a man with a hammer, all problems look like nails".
The blogger's advertising-centric point of view seems to have blinded him to the broader strategic blunders of Detroit.
Lousy Marketing -- Not Lousy Cars -- Killed Detroit??
Well, Detroit should hire ad-man Karl Rove who sold us a LEMON GWBush --TWICE!!
Bad marketing, lousy cars. No reason it can't be both.
Lousy cars that broke after 5 years..I loved my beatle..Wh
This piece completely misses the point. With attractive product, marketing becomes sexy. This is not a chicken/egg thing. The best marketing in the world cannot, in the modern automotive world, make a significant difference.
Then there's also the issue of long-term inept management, primarily decades' worth at GM, and the disaster that was Daimler leadership at Chrysler. Ford may actually be competently managed at present, but the disaster that Jac Nasser wrought is simply awful, with Ford still paying for it.
So once the companies get past these two hurdles -- which I am not hopeful about -- then one can worry about marketing.
That said, if GM wants to give me a free Malibu or Aura as some sort of marketing tool, I will accept one.
Trust me........
tm
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