Driving the FuturePositioning your brand to create desire in the new automotive reality

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In the 20th century the automobile represented self-expression at its most powerful – our dreams and desires given form in sheet metal. Few possessions represented our aspirations in the way our cars did.So what’s changed?

Brandview

The data in this piece is drawn from BrandView, Lippincott’s

unique approach to measuring and evaluating brands. Now

in its fourth year, this ongoing study is fielded online among

30,000 consumers across four continents. BrandView

quantifies leading indicators of brand success such as Story

Power, Experience Power and Brand Momentum to uncover

the fundamental drivers of brand and business success.

Story Power measures the resonance of the brand idea in

the market overall, while Experience Power measures the

brand’s connection with its users and customers.

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Within every industry, we have found leading brands find a way of differentiating

themselves through compelling stories, signature experiences, or both. Looking to the

fastest-growing markets in the 21st century, cars are often still thought of as potent

symbols of self-expression. They convey status, success and freedom where people still

want the car they drive to make a strong personal statement. However in most developed

markets, car-makers now face the challenge of delivering sustainable, flexible, economical

urban mobility while simultaneously finding new ways to be exciting and desirable.

The move from ‘ownership’ to ‘usership’, particularly among Generation Y, is fundamentally

changing what people need and want from a car. In fact, this is probably the most

significant shift the automotive industry has seen for over a century. The longing for pride

of ownership, demonstrated through the mechanical and the tactile, is becoming more

about the intangible and the virtual – how product, service and software come together to

deliver the experience beyond the vehicle. In a world where cars can interact with their

environment like never before, they are becoming just one piece of a more integrated

lifestyle and mobility system. From charging stations to telematics systems and in-car apps,

car-makers will increasingly need to create brand experiences across new and unfamiliar

touchpoints that fundamentally change the way the car fits into people’s lives.

Over the past decade we have also witnessed the seemingly unstoppable growth of the

premium car-makers. In their attempts to wow increasingly diverse global customers,

people can now drive an incredibly extensive range of vehicles from the likes of BMW, Audi,

Mercedes-Benz and Lexus: from performance SUVs to ultra-compacts, and everything in

between. However this level of variety risks diluting a brand’s core positioning to the point

where it is pulled far away from the essence of what made it so appealing and distinctive in

the first place. With markets like China rapidly catching up with the US in terms of volume,

interpreting and refining the DNA that makes these brands special – in a way that depends

less on the product, and that sustains both authenticity and vitality – will be essential for

any premium brand.

The global automotive industry is changing, and fast. New markets, customers, technology and competitors are forcing car-makers to take a fresh look at how they create relevance and desire. So what will it take to be a leading automotive brand in the future?

‘Look at me...’

S e n S e P e r S P e c t i v e 4

‘...think about me’

As we witness a new order emerging, some brands are positioned for success better than others. Consumers have a clear idea about which brands have their best days ahead, and which are remnants of the past. We call this Brand Momentum, and it is fueled by customer expectations for the future – illuminating those brands that excite people most.

In the US and China, German premium brands are

consistently seen as having the highest Brand Momentum.

People recognise that these brands have relevance and

desirability today, as well as ambition and aspiration for

the future. However, their challenge is to better

differentiate themselves from their direct competitors –

to be more distinctive, and emphasise their individual

character and uniqueness.

In China, without exception, domestic brands are in the

lower half of this ratio. In many ways this is surprising,

given how far these car-makers have come in a relatively

short time. However, their most significant barrier to

winning in China, and being competitive globally, is the

need to be recognized as authentic. These brands need to

have a genuine story – one that gives people a reason to

believe in the brand as well as the product.

In the US too, with notable exceptions such as Ford and

Chevrolet, domestic brands are behind in this metric. They

have failed to keep up with consumer expectations and

now need to consider how to regain relevance again,

particularly in the eyes of increasingly valuable Generation Y

customers. Their challenge is to better align their brand

personalities to the traits that younger generations value

and get excited about.

The Japanese have not yet come close to the Germans in

driving Brand Momentum in China. Yet as a stark contrast,

in the US Japanese car-makers are not only among those

brands considered to have their best days ahead, they are

also leaders in customer experience. These brands

understand how to deliver service that makes people feel

great. Their opportunity now is to build on this foundation

to create even more immersive brand experiences, while

striving to match German brand cachet.

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Brand momentum - china

2

10:1 1:10 Ratio of Best days ahead : Best days behind

Middle of the pack

Leading Lagging

10:1 1:10 Ratio of Best days ahead : Best days behind

Middle of the pack

Leading Lagging

Brand momentum - US

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In the future, which onewill I love?

In the future, which one will I love?

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actions to prepare for the future

Based on our experience of working with many of

the world’s leading car-makers and insights drawn

from our BrandView research, we believe that

building tomorrow’s leading automotive brands

will mean acting on four key imperatives.

4

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Allowing you to achieve greatness

Being strong and serving as a leader

Giving you freedom to explore and discover

Audi BMW Mercedes Lexus Infiniti

be distinctive...

Generally, car-makers are nearing parity in delivering quality,

safety and reliability. For most mass market and premium

brands, sources of product distinctiveness are becoming

ever narrower as components, architectures and platforms

become increasingly shared. While some variety in surface

design and ‘components of feeling’ can still be maintained,

it will be more important than ever to protect and enhance

brand and design distinctiveness to ensure people still see

and feel what makes the brand unique.

In the US, premium German and Japanese car-makers

are seen as distinctive compared to the overall market.

However, this is not the case within their own peer group.

Looking at their brand personalities, we find that all index

highest on similar traits. Today, none of these brands

choose to express an interpretation of ‘premium’ that

breaks the mold or offers a distinctive and compelling

point of view.

For both premium leaders and up-and-coming challengers,

there is a clear opportunity to move away from the

premium clichés of the past and stand for something more

distinctive. Now is the time to reinterpret and redefine what

‘premium’ means to customers – connecting to the traits

that will drive excitement and desire in the future.

In China, we see a similar story to the US for premium

car-makers overall, but here national provenance appears

to be especially relevant as a source of distinctiveness, with

Japanese and German brands seen as having quite distinct

and consistent personality profiles. The Japanese personality

profile indexes higher on ‘indulgence’, ‘freedom’ and

‘discovery’, while the Germans are associated more with

‘greatness’ and ‘leadership’. This implies there is an

opportunity to build distinctiveness beyond national

provenance, to build a brand personality that relies less

on where the brand is from and more on why it’s special.

composition of brand personalities - US

Premium brands in the US have a very similar personality profile

Audi BMW Mercedes Lexus Infiniti

Allowing you to achieve greatness

Being strong and serving as a leader

Giving you freedom to explore and discover

composition of brand personalities - china

Premium brands in China have profiles linked to national provenance

By defining the characteristics that make the brand truly unique, and why they matter to people

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be authentic...

In the future, brands will have far less control over how

they are presented to customers. This means the core brand

idea needs to be powerful and coherent whether you’re in

Nanjing, Nuremberg or North Dakota. This core authenticity,

which remains constant over time, can then be complemented

by a supporting set of attributes that are varied across

markets to drive vitality, excitement and freshness.

However BMW successfully tailors the supporting

personality elements of the brand to different markets,

while keeping its core personality consistent. By sustaining

this powerfully authentic core idea that is complemented

by flexible attributes, BMW ensures the personality of the

brand can be nuanced effectively in response to local

market needs.

So far, the failure of Chinese car brands to build authenticity

has limited their performance at home and denied them

the credibility to enter new markets. They tend not to be

loved by consumers because they lack a powerful,

compelling core idea for people to connect with. Building

this authenticity requires the brand to express a genuine

idea that is both relevant and desired; one that can be

understood and experienced in a way that makes people

want to invite the brand into their lives.

On the flip side, for brands that have a strong core idea, the

test is to ensure it can be flexed to appeal in different markets

without losing authenticity. Of all the global car-makers, our

study shows the one that demonstrates this principle best is

BMW. By anchoring itself to a powerfully authentic core

idea, the brand achieves consistently high levels of Story

Power and Experience Power right across the globe.

Experien

ce po

wer 60

80

100

120

140

160 160

0 20 40 60 80 100 120 140 160

Ind

ustry averag

e: 106

Industry average: 106

Love

d

Authenticity

Authenticity vs. Loved - china

In China, people love the brand they find to be highly authentic

20

60

100

140

180

220

20 60 100 140 180 220

TRIBAL

Exp

erie

nce

po

wer

Story Power

UNATTACHED

LEGENDS

STORY TELLERS

BMW achieves a remarkably consistent performance across markets

Story vs. experience

composition of brand personalities

Allowing you to achieve greatness

Sense of wonder

Letting you indulge

Being strong and serving as a leader

US China UK Brazil

BMW flexes its supporting brand characteristics across markets

By being true to the essence of what makes the brand special, while staying relevant and vital

S e n S e P e r S P e c t i v e 1 0

Helping make life more fun

Challenging convention

Letting you be who you are at heart

Helping you experience a sense of wonder

Chrysler Dodge Chevrolet GMC Hyundai

be relevant...

By connecting to the things people care about and by embodying the traits that people find exciting

Generation Y will represent over 30% of global car buyers

by 2015 and have values that are very different to previous

generations. Functional factors are no longer variables,

reliability is assumed and comfort is expected. They look

instead to brands that align to a specific and more

emotional set of needs, traits and values. Brands that are

unable to create relevance in this way face the prospect of

competing on an ever-narrowing set of functional factors,

restricting their chances of ever creating a true emotional

connection to these customers.

Looking at the personality traits most aligned to the values

of Generation Y, contrasting profiles emerge for many

US domestic brands compared with challenger brands

like Hyundai, which successfully appeals to younger

audiences with a compelling mix of technology, design

and value for money.

We see that Hyundai indexes highly on the characteristics

relevant to Generation Y, particularly around ‘fun’ and

‘challenging convention’. The US domestic brands can

certainly learn from the Hyundai profile having fought hard

to be desired by an increasingly design and technology savvy

customer. For brands such as Chrysler, Dodge, Chevrolet and

GMC, becoming better aligned to Generation Y will be their

greatest challenge if they are to compete successfully in the

future, laying the foundations for long-term brand loyalty.

However, while Generation Y is too big to ignore, it is still

far from being the whole market. How can you appeal to

the demands of younger customers while continuing to

serve the established market? VW is one brand that has

successfully nuanced its personality profile across generations.

Generation Y sees VW as a brand that is more about ‘fun’

and ‘wonder’, while for older generations the brand

appeals for being about ‘challenging convention’ and

‘being who you are at heart’. This divide allows VW to

target different messages at these groups through both

product positioning and segmented marketing – driving

a remarkable breadth of brand appeal in the process.

composition of brand personalities

Hyundai over indexes on traits relevant to Generation Y versus US domestic brands

VW has a differentiated personality profile between generations

Helping make life more fun

Challenging convention

Letting you be who you are at heart

Helping you experience a sense of wonder

Under 35 Over 35

composition of brand personalities

S e n S e P e r S P e c t i v e 1 1

be immersive...

By creating compelling, seamless experiences that deliver the brand beyond the vehicle

New touchpoints are becoming core to the experience

Economy Maximization

Remote Services

Congestion Avoidance

Intelligent Route

Planning

Public Transport

Integration

Traffic Management

Car Sharing Services

new digital ecosystem

80

100

120

140

160

80

100

120

140

160

1.

RANK

2.

3.

4.

5.

6.

7.

8.

9.

10.

Lexus

Honda

Toyota

Nissan

Infiniti

Chevrolet

Ford

Chrysler

Dodge

GMC

1.

RANK

2.

3.

4.

5.

6.

7.

8.

9.

10.

Lexus

Toyota

Nissan

Chevrolet

Honda

Ford

Dodge

Infiniti

Chrysler

GMC

“This is a brand I love” “This brand makes me feel great”

American brands Japanese brands

value brand ranking - US

Japanese brands lead domestic brands in the value market

For most automotive brands, the experience delivered

beyond the car remains remarkably generic; failing to be

as rich or immersive as that delivered by the vehicles

themselves. Generally this results in an over-reliance on

product and engineering differentiation.

Excluding the premium European car-makers and looking

towards the mass market in the US, it is Japanese brands

such as Lexus, Toyota, Honda and Nissan that have a

significant lead on US domestic brands for being loved

and making customers feel great. This is a true testament

to how much the service experience beyond the car counts

in the minds of customers. Japanese brands are loved for

being service leaders, with Lexus in particular putting

quality of service at the core of its ownership experience.

However, to stay at the top, service will need to become a

far more powerful tool for driving brand engagement. This

will need to start with dealerships becoming a significantly

more powerful touchpoint, delivering immersion into the

brand in the same way retail innovators such as Apple, Lego

and Nespresso have achieved. The automotive leaders of

tomorrow will transform their showrooms into exciting

brand experiences that mix brand theatre and immersion

with integrated sales and service.

The digital environment is also becoming an essential and

inseparable part of the automotive brand experience. In

fact, telematics are already one of the key drivers of vehicle

choice for younger buyers. As digital services become more

connected and independent of the car, the opportunity will

be to take control of new brand touchpoints that extend

the entire brand experience. The challenge will be to

maintain the integrity of the experience while integrating

branded and third-party services in a way that represents a

seamless, engaging alliance between user and brand.

Driving the future

In the new automotive reality, a renewed focus on brand building will be key to being both relevant and desired.

As you think about how to align your brand effectively to this new reality, the path to success begins with a realistic appraisal of your current position and future aspirations.

Being distinctive will protect brands from the need to compete on

increasingly narrow functional and performance differences

Being authentic will give brands the consistent foundation from

which to adapt credibly to multiple geographic and

demographic markets

Being relevant will allow brands to sustain excitement and loyalty

across different customer groups, driving long-term

brand advocacy

Being immersive will stretch the brand into new propositions, value-added

services and emerging parts of the mobility value chain

Questions to ask:

• Are you able to discover and then harness your

most powerful, differentiated sources of brand

distinctiveness? Do you know which traits are

most relevant, both now and in the future?

• Are you able to define and express an authentic brand

idea that combines a powerful, compelling core with

the adaptability and agility to flex across markets?

• Is your brand able to connect with Generation Y

customers in a way that makes them excited to invite

your brand into their lives? Are you able to flex your

brand to appeal across generations?

• Can you translate your brand into experiences beyond

the vehicle, embracing new and emerging physical and

digital environments?

© 2013 Lippincott, a division of Oliver Wyman, Inc.

www.lippincott.com

ABoUt LiPPincottLippincott is a leading brand strategy and design firm. We uniquely

combine business-based strategic thinking and creative excellence

to solve the most complex challenges facing corporations today.

As pioneers of corporate identity 70 years ago, we have been

behind some of the world’s most iconic brands and partner with

today’s leaders as they shape their brands for the future.

Dylan StuartPartner, Brand Strategydylan.stuart@lippincott.com

AUthor

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