DAVE GUILFORD

Farley's smart to value Ford's heritage

Efforts to move brands upscale can backfire

Dave Guilford is news editor at Automotive News.
Every time I hear Jim Farley's take on the Ford brand, I marvel at how rare it is among automotive marketing people.

Farley is Ford Motor's chief of marketing and communications. In his view, the Ford brand's mission is to be populist, democratizing technology by bringing it to mainstream buyers at a reasonable price.

That may sound like common sense, but it's uncommon among marketing executives for midmarket brands such as Ford.

More often, marketers seem eager to shed a middle-market heritage and — here's the dreaded phrase — take a brand upscale.

The list of brands that have tried this recently includes Saturn, Hyundai, Volkswagen and Subaru. It hasn't worked terribly well. Volkswagen and Subaru backed away from the goal after finding their core buyers resistant, although VW seems to be taking a second run at it. Saturn and Hyundai have only just begun to experience what they're up against.

The allure of aiming upmarket is easy to understand. Perhaps your company makes solid, everyday vehicles. Perhaps you can cite data to prove that the quality of your vehicles is as good as that of premium brands. Perhaps your margins are being crunched by the weak dollar.

So why not throw some leather and an arena-worthy sound system into the cars? Surely you could harvest that extra $5,000 per car that the posh brands get.

Actually, you probably can't — at least not easily or quickly.

To marketing exec Jim Farley, the writer says, the Ford brand has a populist mission, bringing technology to mainstream buyers at a reasonable price.

BMW envy

I think of the urge to take a volume brand upscale as BMW envy. It illustrates a life-is-not-fair law of automotive marketing: Everyone wants to be BMW, but not everyone gets to be BMW.

Discussion of brand images lends itself to hot air. Sometimes when listening to marketing types talk about brand DNA, psychographics and the like, I half-expect someone to divine the future from the entrails of a chicken.

But despite the dubious jargon, one marketing truth is real: Brand images are powerful. They're sticky. They're like that piece of tape that you can't get off your fingers. And that's true whether the image is one that you shrewdly constructed over decades or one that you just sort of slid into.

Once a brand's identity gets fixed in the public's mind, it is extremely hard to dislodge. Smart, appealing advertising doesn't seem to do it. Building better cars probably will, but even that doesn't work quickly. Brand images move in terms of decades or generations.

It's revealing that people still say "this is not your father's" bourbon or lawn mower or whatever, forgetting — perhaps never knowing — that the original advertising tag line was "not your father's Oldsmobile."

Think about that. The ad campaign was meant to move a brand image — and we all know what happened to Oldsmobile.

You can't just snap your fingers or do one cool car or one memorable ad campaign and change a brand image.

A former marketing person for an Asian automaker once told me that Honda and Toyota spent a decade patiently stretching the Accord and Camry up to the $28,000 range for high-end models.

Phaeton's failure

By contrast, VW found out that its Phaeton, at a $68,655 base price, was too expensive for its loyalists. Meanwhile, buyers who could afford the Phaeton didn't want a VW logo on the grille. That VW had put together a very credible car was irrelevant.

It makes you wonder about the marketplace reception for a loaded Saturn Outlook that breaks the $40,000 barrier or a $30,000 Hyundai Genesis. The leap isn't as big as VW's, but those vehicles still stretch the boundaries of the brand.

That's a dicey proposition.

When stretched too far, the boundaries of a brand tend to snap back into place. As tempting as premium pricing may be, if your business has been selling moderately priced cars to people of moderate means, that's likely to continue to be your business for some time.

That's why Farley is wise to work within Ford's identity rather than talk about glitzing up the brand and jacking up the sticker price.

You can reach Dave Guilford at dguilford@crain.com

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