Strike up the brand!

All manufacturers whose neglect of their brands is reflected in low loyalty figures must now be looking to their promotional plans. If the predators are out and about, so are the victims.

Both Fiat and Saab have committed publicly to ongoing and expensive model plans, and both have made it clear that the brand message as a self-propelled free-standing concept will be forcefully projected to support dealers in doing the necessary.

Faced with mounting competition in Europe and missed 2001 volume and profit targets, Fiat subjected 6,000 dealers from 25 countries to an intensive enthusiasm-boosting summer seminar in Milan which cost €5m – as much as a major new car launch. The theme: the “value of the brands”; the purpose: to gear up to sell large quantities of a total of 19 new models – Fiat, Alfa Romeo and Lancia – involving a total development cost of €14 billion, to be launched by the end of 2005. Fiat Auto is spending €1,250m on marketing in Europe in 2001/2002 and is committed to “a marketing development and image strategy that will enable us to attain our goal of selling three million vehicles within the next three years while enjoying sound profitability”, then CEO Roberto Testore told his audience.

It is not just mainstream product that is looking for expansion in an over-supplied market by way of a brand boost. Stung by surveys which put public awareness of the Saab brand well below that of German rivals, and on the brink of a programme to produce one new model a year for the next six years – including dramatic departures from its worthy-middle executive market position – the Swedish carmaker is mounting a long-term multi-level global campaign to boost its name and logo and assume its status as GM’s premier European brand.

“Under a new ‘Saab Unlimited’ banner, the company will establish Brand Centres and City Centre Sites in prominent locations..”

Under a new “Saab Unlimited” banner, the company will establish Brand Centres and City Centre Sites in prominent locations, while dealers will become “Unlimited Partners” with a new showroom approach whereby “hosts” will lead customers through a series of zones emphasising Saab history and philosophy as well as technical expertise and model offerings. “Brand awareness is one of the key challenges,” says Gary Axon, product strategy and communication manager with Saab Great Britain. “When they were asked which premier automotive brands came most readily to mind, 60 per cent of people we surveyed quoted BMW but only 30 per cent put Saab on their list.

“We are at half the level of awareness enjoyed by some of our German friends. As we prepare for the changes represented by our forthcoming new models, we are simply not as front-of-mind with our audience as we would like to be.”

Increasingly a model expansion programme must be paralleled by, or preceded by, plans to expand the desirability of the brand in principle and in practice.

Fiat Auto’s Testore put it this way: “Behind this marketing project of ours lies the great effort the entire company is making to respond to the demands from a world that is constantly changing around us – in the pace at which innovations take place, in market trends, in the intensity of the competition. The whole situation has been speeded up by the internet, and the vast amount of knowledge that potential customers can acquire about us and our competitors.”

Four elements make up the industrial plan: product innovation promoting strong identity, image and value; globalisation typified by success for the second-generation Brazil produced Palio and its potential in eastern markets; the industrial alliance with GM which would be “a cornerstone of structural competitiveness”; and leadership in the new world of integration between product, service, information and communication.

But this plan has to be matched in the public domain, and dealers from 1,015 Fiat, 765 Alfa and 400 Lancia outlets were put through a conference complex set up in a film studio in three waves over a six day period to remind them of brand values.

Separate environments concentrated on each brand. Day one gave them an in-depth briefing on Fiat Auto strategies and expectations. Day two immersed them in the business plans in which they were expected to participate, covering the “brand experience”, product management, local marketing and customer loyalty.

“They were encouraged to think ‘out of the box’ – to look outside the automotive industry for inspiration. “

They were encouraged to think “out of the box” – to look outside the automotive industry for inspiration. The mass-market successes of Nike, Coca Cola, Swatch, GAP and particularly IKEA were held up as examples for Fiat. Gucci was proposed as a model for Alfa Romeo, and Ferragamo for Lancia.

Fiat was “always a young brand giving people their first car and the most important brand because it’s through Fiat that most customers become acquainted with us”, Fiat Auto marketing and commercial director Juan Jose Diaz Ruiz told them. The group intended to retain leadership in small cars, but the balance would shift to greater emphasis on the C segment with nine launches in three years, starting with Stilo, because “Peugeot and Renault have a better balanced mix than Fiat”. “It’s not the great luxury brands but the daily products that become part of our lives and create strength,” said Diaz Ruiz. “Fiat must see a regeneration, a rebirth. We are going to have to move the mix upwards to give us more profitability.”

Fiat needed a multi-segment and multichannel approach in the dealer network as well as in manufacturing, said Diaz Ruiz, with local marketing plans split according to types of customer (the company car customer was a pillar of the sales plan) and clearly focused arguments and services. Customers would have a great freedom to change their minds – they might add a sunroof to the specification within two weeks of delivery, and order a different colour up to one week before.

Alfa Romeo would relaunch GTA versions of all its models as part of the brand relaunch, Diaz Ruiz announced. Alfa sales were booming, but the mission of the marque was to accelerate this growth and use the opportunity to “bring in a new generation of dynamic young and trendy customers looking for maximum lifestyle”.

A “robust” Alfa brand marketing plan envisaged premium positioning covering all the elite sporting niches, with brand values of beauty and sensuality, expressiveness, strength and contemporariness appealing to the under- 40s and as much to female as to male executives. Local marketing would include long test drives “to give customers a physical relationship with the car and link the tangible with emotion and beauty – a quick spin round the block is not enough”.

Alfa brand loyalty was up to 70 per cent in some countries and this was the target for the global market, Diaz Ruiz said. Alfa was now sold in 80 countries and the overall objective was to double Alfa sales worldwide by 2008. By that same year Fiat Auto wanted to sell 300,000 Lancias annually, 40 per cent of them outside Italy, with a brand mission to make Lancia an international point of reference for luxury cars (there are no current plans to reintroduce Lancia in Britain, according to Fiat Auto UK managing director Jim Blades, though it could happen “when the time is right”).

Saab’s approach has crystallised beyond great statements of intent. Dealers know exactly what is needed of them, and what the company is doing at brand level. At the new Unlimited Partners dealer premises, changes will “go further than a new modular showroom layout”, says Gary Axon.

“There will be five zones through which customers pass. We’re creating an experience during which they get to understand the essence of our brand and can peruse the entire Saab range simply and in comfort.

“We’re being very radical about our new approach, which changes the way we interact with customers on the ground. Salesmen will not be located in the showrooms. A host will greet customers and map out a route so that their specific needs can be met.”

The dealer campaign will work in concert with strictly non-retail Brand Centres and City Centre Sites located where large numbers of the public pass in order to “achieve brand presence where it matters, right where our customers are, on the street, at the heart of the metropolitan areas as they go shopping and go to work”, according to Axon.

Brand Centres – “an experience rather than a retail environment” – have been established at airport concourses at Gothenburg’s Landvetter airport, London’s Heathrow Terminal 2 and Birmingham International’s Eurohub. A score more will be set up at other world airports during the next three years including Paris Charles de Gaulle, Frankfurt, New York JFK, Tokyo Narita and Sydney. Over the same period 100 City Centre Sites will be established in prominent locations “where you wouldn’t expect to find a car showroom or anything to do with a car”, according to Axon. A blueprint site opened in Berlin’s Kurfuerstendamm in April will be followed next year by a similar centre in London’s Piccadilly and by other upmarket locations in Frankfurt, Paris, Milan, Barcelona and Stockholm.

The parallel sea-change is Saab’s imminent model revolution. The powerful new 9-5 saloons and estates incorporate 1,265 specific changes, but their style is straight out of the Trollhattan wardrobe. That may not be the case with the next 9-3, while plans include a two-seater based on the 9X seen at Frankfurt, and a sport/utility. In these segments Saab cannot rely on its traditional customers.

“Saab must also contemplate its responsibility for marketing Cadillac in Europe from January, with the launch of the CTS in May.”

Saab must also contemplate its responsibility for marketing Cadillac in Europe from January, with the launch of the CTS in May. Saab will initially handle CTS in major city centres, but with the addition of the sport-utility Vizon concept seen at Detroit and due to reach the market in 2003, dealerships in rural areas may also take on the US marque.

Saab believes it could be selling 2,000 Cadillacs a year in Germany, 1,000 in Switzerland, and 500 in both Swedish and UK markets by mid-decade. That can hardly happen if the Saab brand image itself is less than powerful.