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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Product, product, product!
Hype ain't the product.
You're an ad man, so you see everything through that lens. But most people see Detroit's failure as one of product, not advertising.
A really great car wouldn't need a great pitch. And a lousy car can't be saved with one. Americans wanted ifferent, Big 3 kept on giving the same. Now they will fail. Oldest story in the world.
Adam, this is nonsense. And it reeks of what every agency "creative" tells clients to excuse his or her excesses and forays into nonsense, on the client's dime, of course. "Yes, we do have to do that shot in the South of France! The light on the California coastline .just isn't right."
Detroit is screwed for one reason only; it built lousy cars. They were poorly constructed, unreliable, and their makers refused to deal with the inevitability of higher gas prices. The latter issue opened the public mind to trying Japanese brands, and what they found, they liked. The battle was lost in the 1970s and 80s. We've just been witnessing Detroit's long, slow retreat since.
The products are way better now, but a perception gap still exists that domestics are not as good as the imports and there may not be time to close it.
And you know what? Winning an Addy or a Cleo won't make that happen any faster.
You are wrong. Detroit's cars are lousy, all right. They lose money on cars, thousands of dollars per. That's lousy! How in the world are they going to make a profit on economy cars when their fixed costs are so tremendous? It is going to get worse for their bottom line. They did not crank out Hummers just because they were a crass company. Their light trucks were the profitable part of their business.
GM is doomed. This is certainly a calamity for Detroit, but Detroit was a one-horse town for far too long. Detroit needs a Marshall Plan to keep it viable, like building passenger trains and practical vehicles instead of land yachts.
You may have a point about the advertising, but it is a moot point.
The lure and pressure of "big oil" killed Detroit. Period and end of discussion
In the late 80's GM launched the Saturn mark. In its 3rd year my wife and I bought a Saturn SW2. What a car. Far superior to the Subaru that it replaced. In '05 we wanted to replace it due to the high miles. We wanted a high mileage car. A hybrid. Where was the Saturn Ion Hybrid? We would have bought it in a heartbeat. But nooo, GM had made Saturn a SUV car company. We bought a Honda Civic hybrid. We still have the Saturn. Still fast, economical (31-34), reasonably reliable with 171,000 mi. They abdicated the innovation and engineering to Japan. They spent their design money on lobbyists. What a sorry outfit. I feel for the line workers.
ditto. as our sw2 aged, we started looking at a replacement. unfortunately, saturn no longer made the sw2 or anything like it. we could go for the vue, but it was bigger and lower mpg - exactly the opposite of what the sw2 was. saturn walked away from its customers by embracing suv-madness.
"Detroit" was never interested in smaller, fuel-efficient cars because there was a HUGE of cohort of "Murkans" for whom the image of DOMINANCE was paramount. Accordingly, without--at least, initially--much serious competition, the domestic car industry continued to play a miopic game.....
Why Ford and GM couldn't, at least, import the better of their European, small cars to satisfy that market segment is likely down to some obtuse calculation of profitabil
The issue of perceived quality has to be addressed in greater depth. While Detroit has recently improved their initial quality ratings, it may be a case of "too little, too late." Additionally, initial quality and durability are two different measurements of quality; the former is relatively meaningless if the damned thing ages poorly. The American automobile now has the reputation of being poorly designed, and made of mediocre materials. Poor components assembled well is NOT perceived as high-quality.
Finally, the American approach to manufacturing in general emphasizes style over substance, marketing over fitness of purpose. Until they quit trying to snow the rubes, they will not win over educated buyers.
"too little, too late."
EXACTLY!
In the imbecilic words of W, "Fool me once, shame on..on..yo
Ypur ideas about Us branded cars are so 1980s
there is no question that quality, safety and emissions have been improving over the years
and as the automotive press, consumer reports and the quality agencies are finally begrudinlgy admitting after being so long in the tank for the foreign brands that yes US cars are every bit as good as the japanese, and better than most europeans
Obviously you know little about the auto industry - they ALL share the same supply base - the materials and copmonest come from many of the same suppliers regardless of brand
Car commercials are the most painful of all commercials to watch.
Typical.
While Detroit could have used some marketing help -- like having some person of interest have "their" car or something like that, I think it's both style and content. It's sure not the unions. Where were they in terms of standards on safety and mileage and such? They trailed the Japanese, the Swedes and the Germans. Didn't they "kill" the electric car? When the world shifted to small cars like you see in Europe, Detroit opted to specialize in behemouths -- where was the foresight? They wanted tough guy cowboy spots, not smart. GM's "on start" was the first move I thought struck a good note. My first car was a used Pontiac but since then it's been Japanese (one Toyota, one Subaru). I've not been sorry. If/when an American company makes a nice looking car that's safe and practical, I'll consider it. They didn't so I didn't.
Volvo is owned by Ford BTW
Toyotas product mix relies heavily on trucks, SUVs and larger cars - this is not somehting unique to detroit
even "green" car company Subaru recently increased the size and weight of its popular Forester, and worsened its mpg in the process
The auto press frequently criticises the japanese brands for bland styling and lackluster performance
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