Crain News Service
Subaru of America Inc.'s marketing philosophy has changed since the car marketer last advertised during the Super Bowl - back in 1993, when it spent roughly $2.3 million for 1.5 minutes.
'I'd rather have strong (event marketing) programs that enhance the image of the brand than 90 seconds on the Super Bowl,' said Tim Mahoney, marketing director.
Subaru, in fact, has increased its events and sponsorship programs since 1993. The niche brand now spends slightly more than $2.3 million annually on events and sponsorships, at least double what it spent five years ago when its only sponsorship was of the U.S. Ski Team.
Subaru is representative of an auto industry trend that has been building in recent years. Car marketers increasingly are taking their vehicles to their prospects instead of waiting for the prospects to come to dealerships.
'In the old days, we waited for them to come to us,' said Bud Liebler, senior vice president of marketing at DaimlerChrysler Corp. 'We want to turn that process around and put our products where our customers are. You'll continue to see these kinds of events.'
Five years ago, he said, the Chrysler, Dodge, Jeep and Plymouth brands spent about 2 percent of their advertising budgets in nontraditional media, which include events and the Internet. The four brands have now quintupled that ratio, allocating more than 10 percent of their respective annual ad budgets to nontraditional media.
The four brands spent $1.3 billion in measured media in 1997, according to Competitive Media Reporting.
While they are widely acknowledged to be growing, event marketing expenditures are difficult to track. The IEG Sponsorship Report compiles tallies for sponsorships, defined as when marketers are approached by outside parties and pay to be involved. Events, however, are considered separately, because marketers sometimes create their own.
Lance Helgeson, managing editor of the IEG Sponsorship Report, said auto sponsorships and events are related closely because both aim to connect with consumers outside showrooms.
Helgeson said the five biggest auto spenders for sponsorships are General Motors, $110 million annually; Chrysler, Dodge, Jeep and Plymouth brands, $60 million; Ford Motor Co., $38 million to $40 million; Toyota Motor Sales U.S.A. Inc., $10 million to $15 million; and Nissan North America Inc., $13 million.
Event marketing has grown significantly in this decade, said Gordon Wangers, managing partner of Automotive Marketing Consultants, which handles vehicle testing and manages events. In the late 1980s, he had difficulties convincing car marketers to go beyond sponsoring golf tournaments. 'Now, event marketing is an accepted line item in their marketing budgets,' Wangers said.
The events also have become more oriented to attract more customer participation, he added.
And that can be crucial to a sale. Customers are five times more likely to buy a vehicle they test drive than just see in a showroom, said Art Spinella, a vice president at CNW Marketing/Research.
Toyota's Lexus Division will kick off a test-drive tour in eight major markets in late March called 'Taste of Lexus.' The weekend programs, produced in-house, will offer owners and prospects the chance to test drive the entire Lexus line - as well as competitive vehicles. Lexus hopes to have 2,000 attendees per weekend.
'We're trying to focus on the customer and get in a little closer touch with them,' said Mike Slagter, corporate marketing manager of Lexus. 'We want to update people on our products and competitive pro-ducts and the philosophy of Lexus.'
Slagter described the program as a major undertaking, on which Lexus is spending 'a lot of money.' He declined to give specifics.
An event with competitive vehicles was considered heresy before Lexus' first event in the category in 1991, Wangers said. The events, he said, 'are much more expensive on a head-count basis than advertising, but more efficient' since the marketers know more about the prospects.
Last fall, GM rolled out a similar road show offering test drives in three cities that included competitors' cars and trucks. GM spent more than $1 million on that program, Auto Show in Motion.
'This is a conquest program,' said Philip Guarascio, vice president and general manager of GM marketing and advertising in North America. 'We don't expect to immediately get a customer who hasn't bought a GM in 10 years. It may take us three years to measure the success of this.'
To reach out to active consumers who match Subaru's profile, the company is involved in a co-promotion with ski maker Head for women's ski clinics in 11 markets. Subaru will visit three cities in 1999 with women's mountain bike clinics.
Also in 1999, Subaru will double to four its Outback Rendezvous weekends of camping, canoeing and fishing for owners and prospects. Subaru invites current owners and owners of competitive models to its events and tracks sales from the mailing lists.
'We are getting some residual sales' from the events, said Subaru's Mahoney. 'We're building goodwill and camaraderie. It's very touchy-feely on the marketing side.'