Until about seven years ago, Subaru was trying to be all things to all people. Then, as George Muller, Subaru of America's president, explained, the wholly owned subsidiary of Fuji Heavy Industries Ltd. revisited its reason for being in the market.
'We realized that we needed to specialize,' Muller said. 'We needed to be different, to add value. For us, the answer rested in our all-wheel-drive capability.'
The results speak for themselves:
U.S. sales have grown for seven straight years.
Sales of all-wheel drive vehicles have tripled in the past six years (the company no longer offers two-wheel-drive vehicles).
Subaru sold 156,806 vehicles in the United States in 1999, its best performance ever.
But the sales success doesn't mean that the cash coffers are overflowing.
Subaru's annual marketing budget is estimated at $60 million to $80 million - not a lot for an automaker. That doesn't buy a lot of national exposure. Promotions must, therefore, be finely focused.
'We don't market to a demographic. We market to a lifestyle,' said Bill Cyphers, Subaru's U.S. vice president of marketing. That lifestyle is an active one.
'We target such magazines as Backpacker,' said Cyphers, 'in addition to publications that cater to cross-country skiing (and) kayaking, as well as publications that generally cater to an active lifestyle.'
Tie-ins with active lifestyles are not new for Subaru. The company was the official sponsor of the U.S. ski team in the mid-1970s. Today, Subaru sponsors the 'Master the Mountain' program, designed to teach safety to recreational skiers or mountain bikers.
Subaru enjoys a relationship with the Ski Patrol, a nonprofit organization that provides medical assistance in emergency situations.
'Through the Ski Patrol program, we make available over 3,000 cars to professional ski instructors and patrols. Plus, there is a special purchase incentive for Ski Patrol members. For every vehicle purchased by patrol members, Subaru will make an undisclosed financial contribution back to the Ski Patrol,' Cyphers said.
Subaru has teamed up with the Panoz Racing School in Braselton, Ga., to offer ad-vanced and performance driving courses to the public. The Subaru/Panoz Performance Driving School at the Road Atlanta race course uses Subaru vehicles exclusively, and provides classroom and on-track training in active safety and performance handling.
For Subaru, this provides an ideal opportunity to enhance brand awareness, while extolling the safety and performance benefits of all-wheel drive.
On the heels of its best sales year ever, Subaru is not about to make wholesale changes to its marketing program, although some tweaking always is in order.
'We will continue using Paul Hogan (of Crocodile Dundee fame) to help promote Subaru's active lifestyle image,' Cyphers said. 'The core message will stay the same, but we are revising it slightly.' The new campaign will debut this month.
Subaru has introduced all-new Legacy and Outback model lines and a new Impreza 2.5 RS sedan for the 2000 model year. A new Forester also is on the way. Does this mean it's time for Subaru to diversify once again? Not likely.
As Muller explained, Subaru will 'concentrate on niche marketing and stick with our core strengths: 26 years of all-wheel-drive in America.'