Auto sales may be flat, but automakers are selling more brand-related merchandise - everything from T-shirts to golf bags.
Such merchandise can extend a brand's reach and generate a lot of money. The companies are reluctant to divulge sales figures, but Jeep alone sells and licenses more than $200 million worth of merchandise annually.
Porsche Cars North America Inc. is developing a more extensive catalog than the current 87-page edition, which includes a $4,000 mountain bike.
This fall, the automaker will begin mailing catalogs several times a year to Porsche owners and prospective buyers. Porsche dealers already sell Porsche-emblazoned products.
'There really are two purposes,' said John Crowe, vice president of parts and service for Porsche. 'One is profit; the other is brand expansion.'
This fall Mercedes-Benz will launch the CLK320 coupe, the E320 station wagon and the ML320 sport-utility. Each vehicle will have an assortment of custom designed wearables and automotive accessories.
Mercedes sells accessories through its dealers, who offer items ranging from T-shirts to bathrobes.
Mercedes also has a retail catalog that it mails twice a year. The summer/fall edition highlights the SLK roadster. Customers can buy SLK sunglasses, wrist watches and luggage designed to fit the SLK's trunk.
When Mercedes offered a toll-free phone number and mailed 500,000 catalogs to owners, prospects and enthusiasts about a year ago, sales doubled at its dealerships.
'We mailed so many catalogs that we created this awareness,' said Steve Beaty, product manager for accessories at Mercedes-Benz of North America Inc. 'A lot of people didn't even know that we had these products.'
According to Jay Houghton, director of marketing for A.T. Kearney Inc., an automotive consulting firm in Southfield, Mich., 'Mercedes-Benz's image for quality and craftsmanship is so strong that its name will enhance the value of whatever you put it on.'
Mass market automakers sell merchandise, too.
Chrysler Corp.'s 'Great Cars. Great Trucks.' exhibit at the Mall of America in Minneapolis has an adjoining shop that sells caps, leather jackets, sweaters and other wearables for its brands.
Dodge Ram wearables are hot items, said Christine MacKenzie, Chrysler's manager of business planning and strategy.'People are proud of that truck.'
As more manufacturers initiate relationship marketing campaigns, programs to create bonds between buyer and seller that go beyond vehicles, they sell goods that reflect customers' lifestyles.
Porsche Design of Austria, for example, designs and sells high-end goods, such as $300 sunglasses and $1,000 briefcases, in about a half dozen boutiques in the United States.
Although Mercedes still sells mugs, key chains and beach towels, its catalog now features leather golf bags and a $1,200 paper sculpture of a 300SL gull-wing coupe.
Porsche plans to offer a racing mountain bike that will be more expensive than the $4,000 model it now sells.
In keeping with Jeep's rugged image, it licenses a boom box - a combination compact disc player, tape player and radio - whose bottom simulates a tire tread. It also will float.
Jeep has been licensing its trademark on products for about 10 years. 'We've created a program that has given Jeep worldwide distribution (of licensed goods),' said Lou Bitonti, merchandising manager for Jeep.
Jeep wants to get its name before upscale consumers and enhance the brand. Chrysler's sport-utility division licenses watches, shirts, toys, sunglasses and outdoor gear.
Bitonti said his division gets a 'substantial amount' of the $200 million of Jeep merchandise sold annually.