Will your ad spending be up or down in 2001, compared with 2000? By what percentage?
Our advertising spending nationally, including the participation of our metropolitan dealer advertising associations (MDAAs) will increase almost 10 percent over last year. Ad spending from 1999 to 2000 was up 20 percent.
It is important to note that this is not just driven by Mitsubishi Motor Sales of America as a distributor. It reflects a significant increase in the participation of our retail partners in MDAAs, which helps increase funding for Mitsubishi advertising. We have 168 MDAAs, and 98 percent of sales go through these dealers. Only a few dealers do not belong to an association.
We collect money from invoices and give it back to the associations. They choose how to spend it. We use one agency - Deutsch - and have one voice.
What media mix do you expect for 2001? How does that compare with 2000?
For 2001 our mix includes about 60 percent network TV, 20 percent cable/syndication, 5 percent print, 10 percent local newspaper, and 5 percent for adjustments among these categories due to changing market requirements during the year.
The percentages are about the same as for 2000. We use television because it increases our reach. People have to see our product. The car is the star. We don't use sports events on television. Deutsch research suggests we need to pinpoint people who have a propensity to buy Japanese cars.
Is the Internet still a good marketing tool for you? How will you use it in 2001?
Mitsubishi customers rank among the industry's highest users of the Internet. Hits on our Web site have more than doubled in the past year. We've been averaging 200,000 a month; they've gone as high as 280,000 for a month.
The Internet is an increasingly important marketing tool for us. In early December, our Retail Marketing Council and National Advisory Board approved plans for a new initiative that we will unveil in February at the NADA meeting in Las Vegas. It will cover several major components of our overall Internet marketing strategy. There are actually two initiatives that will affect both our site and e-commerce.
When it comes to the Internet, we want our dealers to be in charge of selling. We are developing a process for customers wherein when they eventually go to the dealership, they can transfer the research they've done and won't have to start back at square one with the salesperson. In the next three months we hope to have all our dealers linked to an active site.
How do you expect rebates and incentives to affect your marketing budget in 2001?
Fortunately, due to an improved product line, increasing brand awareness and more positive brand reputation, our incentive spending on a per-unit basis has decreased over the past three years. We are not currently planning to increase our incentive spending in 2001; however, we recognize the importance of remaining competitive in a market that is showing signs of softening consumer spending. We will keep our dealers competitive.
What is the biggest launch you have coming up for 2001? When will it be?
We will be launching a totally new compact sedan this July. It's a replacement for the Mirage, but larger and more powerful, with a 2.0-liter engine. We will introduce it as a 2002 model either in Chicago at the auto show or in New York. We have licensed the name and are not releasing that yet. We will keep the Mirage coupe. This is a bread-and-butter market segment that we need to be in.
We plan to launch a new product each year for the next five years here in the U.S., and this new sedan is the first of those new product launches.
What is your major marketing challenge for 2001?
Continuing to build brand awareness in an exceptionally competitive market. Research indicates that our numbers have gone from 44 percent awareness in 1997 to from 50 to 53 percent awareness in 2000.