How Saturn went from unique to just another one of the crowd

The task facing Saturn marketers today is a tough one: raise awareness and consideration while virtually starting over with a repositioned brand, price point and entirely different products. And hope that your parent doesn't shut you down.

"The No. 1 challenge at the national level for Saturn is to raise brand awareness of 'The New Saturn,' quote-unquote," said Dave Koziara, advertising manager of the Saturn unit of General Motors Corp.

The old Saturn was conceived in 1983 as a project to create a new line of innovative U.S.-made cars. The Saturn subsidiary would be "A Different Kind of Company," as Saturn's first ad agency, Hal Riney & Partners, San Francisco, described the automaker. It would be an import-fighter and customer-centric with no-haggle pricing.

Saturns initially had unique features like ding-proof plastic body panels. Mike Lazarus, a former Saturn dealer who was in on the ground-floor planning for the brand, said the original idea was even more far-out. He said consumers would be able to change colors after they bought their Saturn by purchasing different color panels. Ultimately, GM dropped the idea of changing colors and limited the plastic panels to the doors. What goes around comes around, though, as Smart USA is currently making a splash as it rolls out the Smart ForTwo with body panels that swap out.

Early advertising from Riney focused heavily on the traits of Saturn buyers, and maintaining a relationship with the owner was key.

GM opened a dedicated factory for Saturn in the one-stoplight town of Spring Hill, Tenn., and Saturn broke new ground in event marketing by inviting Saturn owners to two very popular "homecomings" in which tens of thousands converged on Spring Hill. The events generated additional, folksy, feel-good advertising. Before Saturn, no one had ever confused an auto factory with "home," but that's how Saturn came across, even for people who'd never been to Spring Hill.

"Saturn did nothing less than reinvent how people bought cars. It was truly visionary," said Mr. Lazarus, who eventually sold his four Saturn locations on Long Island.

"People usually chose the [Saturn] brand because of the experience and not so much for the products," said Jesse Toprak, executive director-industry analysis for Edmunds.com.

The first Saturn cars rolled off the assembly line in 1990, and unit sales peaked in 1994 at 286,003, according to Automotive News. By 2001, however, Saturn's independence from its parent had diminished. The marketing, sales and engineering operations were consolidated into GM, and with other brands to support, GM starved Saturn for new products. The S-Series, Saturn's initial small-car line, had no sibling brands till 1999. Those loyal Saturn owners had nothing to trade up to.

"The no-haggle, stress-free sales experience was for consumers who hated the traditional way of buying cars. This created a problem, because this segment is a very limited base," Mr. Toprak said. "People grow and change, their needs grow and change, people make more money ... if you don't have the right product, the right experience can only take you so far."

The internet also came along, providing much greater transparency for new-car prices across the auto industry. That eroded the value of Saturn's unique selling proposition, the no-negotiation sales experience, Mr. Toprak said. "A lot of consumers came to a very favorable understanding of what a fair price is. It's not that important anymore that you don't have to haggle," he said.

By 2007, Saturn unit sales had fallen to 240,091, Saturn was on its third agency and the GM import-fighter has hardly vanquished the enemy, to the point that some auto critics are now expressing doubts about Saturn's future under GM.

Time to "Rethink." That's the Saturn tagline that debuted last year via Deutsch, Los Angeles, which took over the account without a review in January 2007. The advertising is mostly product-focused. Variations on the theme include "Rethink Sensible" for a fuel economy message and "Rethink Fast Lane" for the Outlook midsize crossover; the latter refers to the fact that the eight-passenger Outlook can carry a car pool in the modern-day fast lane—the high-occupancy-vehicle lane. "Rethink American," backing the Saturn brand, was used briefly and dropped.

With all that rethinking going on, the list of what has stayed the same throughout Saturn's history is short but significant. Saturn has stuck with no-haggle pricing, low-pressure selling and kid-glove customer handling. Those practices have kept Saturn at or near the top of customer-satisfaction surveys for dealer sales and service, especially compared with other nonluxury brands.

Fundamentally, when it was launched Saturn really was "A Different Kind of Company. A Different Kind of Car." That Riney campaign came to be recognized as a classic, distancing Saturn from its cold, corporate giant of a parent. Most people still associate that warm, friendly image with Saturn, even though Riney lost the account in 2002 to Goodby, Silverstein & Partners, San Francisco.

Goodby's 2002 "Sheet Metal" campaign continued to put the spotlight on the consumer, this time to the point of erasing all vehicles. Brilliantly choreographed commercials showed people on foot but acting as if they were behind the wheel, for example backing out of driveways and stopping at traffic lights. "When we design cars, we don't see sheet metal," the voice-over said. "We see the people who may someday drive them. ... It's different in a Saturn."

Saturn continues to target the import shoppers who wouldn't normally consider a domestic brand. That was its original mission, conceived when Saturn was still mostly a gleam in the eye of the late Roger Smith, then GM CEO.

"Saturn's role within GM is still much the same as it has been since its inception, and that is to bring in conquest buyers, what we call 'progressive-minded import intenders.' If it's not—if it's not getting a different kind of customer than maybe is attracted by Chevrolet or Pontiac—then why put the money into Saturn?" Mr. Koziara said.

Saturn got a vote of confidence of sorts in the latest shake-up in GM's distribution channels. Earlier this year, GM grouped together Buick-Pontiac-GMC and Cadillac-Saab-Hummer as its preferred dealership pairings. GM left Chevrolet and Saturn as the sole standalone franchises in the U.S. market, and Saturn kept its exclusive U.S. dealer network. That means Saturn dealers can't have any other franchise at the same facility.

To a large extent, the grinding realities of the auto industry brought Saturn down to earth. Saturn survived as basically a single small-car maker for almost a decade. But by 2005, Saturn was entering new vehicle segments in hopes of extending its appeal. Originally conceived as an import-fighter, Saturn also now offers some imports like the Saturn Astra, a version of the Opel Astra hatchback built in Belgium. The next-generation Saturn Aura will be kin to the next-generation Opel Insignia. And the Saturn Vue compact crossover is made in Mexico.

To save money, the entire Saturn product lineup is now shared with other GM brands and built virtually around the world. Beneath the skin, the Saturn Outlook crossover is related to the Buick Enclave and the GMC Acadia, and the Saturn Aura sedan is related to the Chevy Malibu. The Saturn Sky roadster is a fraternal twin of the Pontiac Solstice.

The new products also have meant higher prices from a marketer that shoppers often thought of as an entry-level brand. Saturn has added more models in bigger and more upscale product segments, like the Sky convertible (new in 2006) and Outlook (2007). The average Saturn transaction price was only $17,036 for all of 2004, vs. $23,234 in the first half of 2008, according to the Power Information Network. The average Outlook is $32,477 this year, PIN data show.

"We started out with a car with plastic panels, a really inexpensive college-kid car," Mr. Koziara said. "That's what we used to be."

"The job we have is to reacquaint people with the brand. That's why 'Rethink' is focused largely on product," he said. "Because that's where people's perception lags reality the most."

The risk to Saturn is that all these changes will turn off its loyal customers by becoming "just another GM brand." Offsetting that are the cost savings to GM from sharing products, a wider product lineup with more choices for consumers, and the fact that Saturn dealerships still offer no-haggle pricing and good customer handling.

Armed with an entirely new lineup in the last couple years, Saturn is essentially starting over. The fact that Saturn is still aimed at import intenders keeps the operation key to GM's future success.

"I don't see GM getting rid of Saturn," Mr. Toprak said. "It's still seen as important."