HYUNDAI’S EQUUS · The goals of our campaign are to increase awareness of Hyundai’s Equus, its...

HYUNDAI’S

EQUUSAdvertising Campaign Book

Jocelyn Allen, Katy Leuschner, Amanda Newby, Jeff Worrall, Nick Wynne

Equus Advertising Campaign Book

TABLE OF CONTENTS

Creative Brief . . . . . . . . . . . . . . . . . . . . . . . . 4Executive Summary . . . . . . . . . . . . . . . . . . . . 5Research . . . . . . . . . . . . . . . . . . . . . . . . . . . 6History of the Company . . . . . . . . . . . . . . . . . 7 Situational Analysis . . . . . . . . . . . . . . . . . . . . 8Goals and Objectives . . . . . . . . . . . . . . . . . . 10Markets/Segments/Publics . . . . . . . . . . . . . . . 11Problems/Opportunities . . . . . . . . . . . . . . . . 12Strategies . . . . . . . . . . . . . . . . . . . . . . . . . . 14Tactics/Media Buys . . . . . . . . . . . . . . . . . . . . 16Evaluation . . . . . . . . . . . . . . . . . . . . . . . . . . 17Budget . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18Appendices . . . . . . . . . . . . . . . . . . . . . . . . . 20

CREATIVE BRIEF

As the entry vehicle to Hyundai’s new high-end, full-size luxury line, the Equus is reaching for a market previously out of the company’s grasp. Currently, Hyundai is thought of as a dependable, trustworthy brand, but has never attempted to reach the high-end luxury market in the U.S. However, we hope that Hyundai’s positive image can lead to consumers trusting that it is capable of creating a worthy luxury vehicle.

From the survey we conducted, consumers gave us insight as to how Hyundai could improve its image as a luxury car manufacturer:

•“Hyundai...should be promoted in a more high-class, prestigious way.” -Meagan Evertson, age 20.

•“Hyundai’s marketing and ads must scream luxury.” -Jeff Coleman, age 20

•“Look, price, quality.” -Anthony Santaluccia, age 22

We need to update the use of social media in our campaign, compared to how it is currently being used. We will create an application that will be available for app devices and also installed in the iPad user manual, which will draw attention through its interaction-factor and will apply to information-seeking consumers. We will create a new commercial campaign idea using the slogan, “The Equus is coming,” embracing the translation of the word “equus” meaning “horse.” We want to include four new print ads; one focusing again on the name’s meaning with our slogan, “a horse for every stable,” one introducing the Equus with interior shots, one attributing Hyundai’s reliability with its 10-year/100,000 mile warranty to its new vehicle, as well as an ad embracing the high-end luxury of the new vehicle with the slogan, “lets take the long way home.”

We want to emphasize the reliability of Hyundai through an upgraded version capable of competing in the high-end luxury market.

EXECUTIVE SUMMARY

media and it will allow us to further interact with consumers and hear their feedback.

Hyundai has built a reputation over the years as being a trustworthy brand in the American market and we believe that this, along with the Equus’ features and comparably lower price to other luxury vehicles, provides an incentive for our target audience to accept the Equus in the high-end, full-size luxury vehicle market.

The goals of our campaign are to increase awareness of Hyundai’s Equus, its first high-end, full-size luxury vehicle; to change the attitude of our target audience so that they view the Equus as capable of competing with other luxury vehicles; and to generate a desire among consumers to acquire the Equus. Our target audience includes business professionals in the middle-upper class with a yearly income ranging from $100,000 to $125,000 who might also be considered innovators and thinkers of Generation X.

After conducting research, we are aware that the most difficult aspect of our campaign will be to change our consumers’ attitudes toward Hyundai and to have our target audience break away from brand loyalty toward other luxury vehicle brands. To tackle this, we created advertisements for traditional media as well as new media. We created newspaper, radio, billboard, and television ads, as well as a social media campaign, iPhone Application, and new social network pages. The new media tactics are important because we believe that the Innovators of our target audience will appreciate the use of new

RESEARCH

We wanted to research how consumers perceive Hyundai as an automotive brand currently, so that we could assess whether there was a definite need to change their attitudes.

We surveyed a wide range of people and asked them to rate eight different car brands based on their perceived luxuriousness. A variety of other questions were asked, like which manufacturer they rated the lowest and why, as well as how that manufacturer could improve its position to consumers.

As evidenced by our forty-five respondents, Hyundai is viewed by consumers as the least luxurious brand out of the options provided on our survey, which were mostly higher-end vehicles. Buick followed as the second least luxurious, then Cadillac, Lexus, Jaguar, BMW, Audi, and Mercedes Benz was found to be the most luxurious.

Our conclusion from the forty-five respondents was as expected, that Hyundai is not currently viewed as a luxurious brand by consumers. Introducing a luxury vehicle will require changing this attitude, and

we received feedback from our respondents on how they currently view Hyundai:

•“They’re known for being less luxury and more for everyone--affordable.” -Meagan Evertson, age 20. •“They seem to focus on price and value more so than luxury.” -Glenn Leuschner, age 52.

•“When I think Hyundai I don’t think of them as a luxury car.” - Mary Gresham, age 43

•“Hyundai is low in price and luxury.” -Sara Ilenko, age 22

HISTORY OF THE COMPANY

The company was founded in South Korea in 1947 as a construction and engineering company by Chung Ju-yung. Then, the Hyundai Motor Company was established in 1967. In 1968 the company released the Cortina, its first model, in cooperation with Ford Motor Company, and also released the Hyundai Excel as their first car sold in the U.S. The company released the first model with all of its own technology in 1988, the midsize Sonata. Ten years later, the Hyundai Motor Company bought Kia Motors. As of 2009, the Hyundai Kia Automotive Group is the world’s fourth largest automaker. Hyundai operates the world’s largest integrated manufacturing facility which annually produces approximately 1.6 million units. The vehicles are sold in 193 countries, with around 6,000 dealerships worldwide, that collectively employ approximately 75,000 people.

Hyundai’s first car, the Cortina, could be sold in Canada but not in the United States due to emissions standards. The Excel was initially well-received, however the Hyundai reputation for great quality was damaged from the effects of cost-cutting. Because the vehicle caused sales to dramatically decrease,

Hyundai responded with the Hyundai challenge, a 10-year or 100,000 mile powertrain warranty. They began to focus on the long-term research of their vehicles, concentrating on quality, design, and manufacturing. In 2004 J.D. Power and Associates conducted an Initial Quality Survey and determined that Hyundai and Honda tied for second, only behind Toyota in their category. Their reputation continued to bloom in 2006 when the company placed third overall behind Porsche and Lexus in J.D. Power and Associates’ Initial Quality Survey, but in 2007 the ranking fell to twelfth, and in 2009 jumped to the Highest Ranked Non-Premium Nameplate.

SITUATIONAL ANALYSIS

Hyundai is a respectable car company that originated in South Korea but has been selling cars to U.S. consumers since 1986. Safety, design, and quality have continued to be their main focus, and they are frequently praised for their standard safety equipment. The Hyundai logo not only represents the first letter of the brand’s name, but also symbolizes two people--the company and the consumer--shaking hands. Believing in their commitment to constituents, Hyundai’s promise of a 10-year/100,000-mile warranty on every car remains intact to this day. Overall, Hyundai is viewed as a reliable, affordable brand that focuses on the integrity of their vehicles. Hyundai has decided to expand their position in the automotive market by introducing a more high-end line of vehicle to extend the familiarity and promise of quality in their handshake to a wider audience. To reach this audience Hyundai has just released their new luxury line with the Equus, a high-end vehicle at a more affordable cost. Other brands that have successfully made the crossover from standard vehicles to luxury include Honda with the Acura, Toyota with the Lexus, and Nissan with the

Infinity. However Hyundai has designed the Equus to compete with high-end full-size luxury cars like the BMW 7 Series, Mecedes-Benz S-Class, Lexus LS, the Jaguar XJ, the Audi A8, the Cadillac STS, and the Porsce Panamera.

Current CampaignThe current Equus campaign has been growing over the course of our creative stages, now including a few television commercials that advertise the convenience of the “Pickup and Drop-off Maintenance” and the relevancy of the iPad user manual. They also have a print ad and a Facebook page that is not well maintained, along with an Equus webpage through the Hyundai website.

Currently, the Equus website is extremely well done. It is interactive and designed for high resolution screens, powerful computers, and high speed internet connections. This tells us that they are targeting the type of people who have these capabilities: middle-to-upper class.

With regards to social media, Hyundai has a Twitter account with currently 11,166 followers; however, they do not tweet particularly frequently nor is the account verified. Also the Hyundai Twitter does not talk about the Equus but it does talk about the Sonata and Elantra. Hyundai does have a Facebook

SITUATIONAL ANALYSIS cont.

account with 144,523 likes where they post videos, talk about their company overview, mission, and websites and ask people to post pictures of their Hyundai vehicles. One of the four websites they have listed is www.hyundaiequus.com along with one of their “like” buttons being their Hyundai Equus Facebook page. The Hyundai Equus Facebook page has 1,574 “likes” and a place for consumers to talk to Hyundai representatives about the Equus. Neither Hyundai nor Equus have a blog. However, some magazines, including Car and Driver and Road and Track, have blogged about the Equus.

They have created a social media contest for Hyundai in general, but nothing specifically for the Equus.

GOALS AND OBJECTIVES

Objectives1. To make 70% of employed professionals who have a yearly income of $100,000-$125,000 aware of Hyundai’s new high-end, full-size luxury vehicle, the Equus, within seven months.

2. To change 30% of American consumers’ attitude/perspective of Hyundai as a bargain brand to considering it a mainstream automaker with a quality luxury line within a year.

3. To generate a desire to buy within the target audience so that 30% of the target audience visits a dealership or talks to a representativewithin one year.

Goals1. To increase awareness of the Equus as Hyundai’s first high-end, full-size luxury executive vehicle.

2. To change consumers’ attitude so that they view Hyundai as capable of having a competitive luxury line.

3. To generate desire for the Equus, or at least more information about it.

MARKETS/SEGMENTS/PUBLICS

Our target audience includes doctors, lawyers, business people, and employed professionals in the middle-upper and upper class with an income of $100,000 to $125,000. Ideally, they are willing to bet on the “underdog” by backing away from established brand names and moving toward a new luxury brand at a lower price. The target audience includes innovators of Generation X that have high self-esteem and take charge, as well as other successful, sophisticated individuals. The audience also consists of net newsers that rely on the internet for their news, read magazines, and are likely to engage in social networking.

PROBLEMS/OPPORTUNITIES

An undeniable obstacle Hyundai faces is that people do not currently view it as a luxury brand. Consumers often have strong brand associations, particularly when it comes to automotive vehicles, so we cannot underestimate the task of changing consumers’ attitudes.

Even if consumers admittedly view the Equus positively, they might not be as willing to purchase one since it would carry the Hyundai logo. In fact, Hyundai even debated not including the unmistakable “H” logo on their new luxury line. Ultimately, though, they placed an Equus logo on the front of the car and a Hyundai logo on the back.

Luxury sedans typically display their powertrain in their namesake. The Lexus LS460 uses this common system: LS is the series and 460 denotes the car’s 4.6 litre engine. Hyundai opted out of this, removing the VS460 badge that the early prototypes wore. This might deter some consumers from fully accepting the Equus as a member of the premium sedan group.Another problem that Equus faces is the fact that there is already an established company with the

same name. This company is Equus Products, Inc. and they are a prime manufacturer of diagnostic and scan tools, test equipment, gauges and tachometers for the automotive aftermarket. This may pose legal issues in the future.

Opportunity exists in the fact that Hyundai has already established itself as a trustworthy brand in the American consumer market. Because of this, we already have general consumer support and people will be more prone to believing that the Equus will uphold the high quality standards of their other vehicles.

Because of the current economy, many consumers might be less willing to splurge on a high-end luxury vehicle. To our advantage, the Equus is priced at around $58,000 for the Signature and $65,000 for the Ultimate, which is not as high as our competitors’ prices in the luxury vehicle market. In fact, the Lexus’ limo-style rear seating is a $13,200 extra cost, while the Equus Ultimate includes this seating arrangement, with only the cost of the $5,000 upgrade from the Signature. The range of prices for

high-end luxury full-sized vehicles is from $60,000 to $100,000, so the Equus is definitely on the lower end of the price spectrum and therefore one of the more affordable vehicles within this category.

Also, the Equus’ Tau motor can run off of Regular and Premium gas, great for obtaining lower gas prices in a fuel-driven economy. It has also won Ward’s Ten Best Engines for three years running.

Consumers who enjoy technological innovation might appreciate and be impressed with the fact that Hyundai is giving an iPad to every person who purchases an Equus, with the owner’s manual already programmed on it.

Hyundai’s cars are manufactured in South Korea, which gives us an advantage over Toyota, Suzuki, Subaru, Mitsuoka, Nissan, Honda, Isuzu, Mitsubishi, Mazda, and Daihatsu due to the Japanese earthquake on March 13, 2011. We do not have to worry about getting cars or car parts whereas some of our competitors are dealing with the effects of this crisis.

Problem StatementOur main issue is that consumers do not view Hyundai as a producer of a luxury vehicle, and that strong brand loyalty exists for those companies that have already established themselves as luxury vehicle producers. If we are unable to change the attitude toward Hyundai, it is unlikely that the Equus will become successful or find a niche in the luxury vehicle market.

PROBLEMS/OPPORTUNITIES cont.

STRATEGIES

Marketing StrategyConsidering our target audience of business professionals who might also be considered innovators and thinkers of Generation X, we will want to place ads traditionally through television, print, and radio. However, since the majority of this audience is business-savvy and receives news from the Internet in addition to traditional media, we also want to create a presence on social media sites.

Advertising StrategyThrough our advertising, we want our target audience to notice that Hyundai has come out with their first high-end luxury vehicle, to feel that Hyundai is a worthy competitor in this market, and to desire more information about the Equus and ultimately purchase the vehicle. Our strengths include price, reliable reputation, and key features. Our weaknesses revolve around the fact that Hyundai has never produced a high-end luxury vehicle in the past. The external opportunities and threats we face are detailed in the previous Problems/Opportunities section (pg. 10-11).

Creative StrategyThe Equus has many attractive features and key benefits for us to use in the creative department.

Along with an impressive motor under the sleek hood, the Equus features a seventeen speaker Lexicon Logic audio system powered by a thirteen channel digital amplifier rated at 608 watts. The system eclipses the number of speakers in both the BMW Seven Series and the Mercedes-Benz S class. It promises to deliver distortion free audio from a variety of sources, including HD radio, satellite radio, iPod, and USB inputs. Along with the top shelf audio system, the Equus is also equipped with a premium navigation system with an eight inch screen controlled by a master knob like the ones that BMW and Audi feature.

Undoubtedly one of the most impressive and unique features of the Equus is the executive style rear seat in the Ultimate model. It features two separate heated and cooled luxury seats with electronically adjustable head rests. The first class seat, located behind the front passenger’s seat, reclines with a

STRATEGIES cont.

fold out leg rest and also has an electronic massage feature. The center console features a small refrigerator and an independent control panel for climate control and entertainment control on the fold-up eight inch monitor.

Some other highlights include nine air bags, rear wheel drive for true performance, and a six speed ZF transmission identical to that of BMW and Porsche. The Equus also comes equipped with continuous damping control and an electronic air suspension for ultimate ride continuity and quality. The air suspension is a costly upgrade on the main competitor, the Lexus LS460.

In addition, the Equus has an impressive Vehicle Stability Management System to keep the driver and passengers safe and comfortable. This incorporates an electronic parking brake, smart cruise control, seat belt tensioning system, instrument warning panel lights, and audio alerts for lane departure.

We will hightlight all these impressive features in our advertisements to cause our constituents to have the

impression that the Equus is capable of competing with other high-end luxury vehicles. To apply to our Generation X target audience, we want to present direct information about the vehicle’s features.

Media StrategyOur market includes: doctors, business people, the middle-upper class, upper class, employed professionals and business professionals with an income of approximately $100,000 to $125,000. Ideally, our audience is more likely to bet on the “underdog.” We have allocated $40 million to help us best meet our objectives, which is half of the budget used in Hyundai’s Genesis campaign. In order to capture our target audience we will use television, print, radio and Internet media vehicles. The specific television networks we will advertise on are ABC, CBS, NBC, FOX, ESPN 2, the SPEED network, and during golf tournaments. We are advertising on these networks to reach our target audience and the advertising will span for six months.

TACTICS/MEDIA BUYS

We plan to advertise on major television networks that apply to our target audience: ABC, CBS, NBC, FOX, ESPN 2, SPEED, and GOLF. Along with television advertisements, we will place print ads in specific car magazines like Motor Trend, Automobile, Car and Driver, Luxury Auto, and Road and Track.

For awareness, we will position twelve billboards near Hyundai dealerships in twelve major cities across the nation: New York, Los Angeles, Chicago, Houston, Phoenix, Philadelphia, San Diego, Dallas, Washington D.C., Detroit, San Francisco, and Jacksonville. These locations were chosen based on population, rank, and wealth. We will also have a radio commercial and air it approximately twelve times during rush hour near local Hyundai dealerships.

In order to attract our net newsers we will incorporate the Internet and social media websites.The Equus Twitter page will include a month long competition titled “Spend a Week with Equus.” Consumers are instructed to tweet their favorite feature of the Equus along with a specific tag (#spndaweekwithequus) in order to enter to win an

Equus and a chauffeur for a week along with an iPad2 with 3G capability. Only one submission per person will be counted and there will be five winners selected through a random generator. We believe this competition will generate awareness and expose constituents to the features of the vehicle. Also, we anticipate that it will generate an interest in the vehicle through word of mouth marketing. The Twitter page will also include frequent updates of “#spotted” Equi being driven and will link to a Twitpic photo account with a feed detailing features of the vehicle.

The Equus page on Facebook will be a fan page that people can “like” and subsequently receive updates and facts about the vehicles and how the luxury line is growing. This is a pull tactic since only the people who are interested in the Equus will seek to join its Facebook page. It will also allow for two-way communication since we will be able to receive feedback from consumers on Facebook and give responses. The page will feature a photo gallery of the Signature and the Ultimate vehicles and all their features, as well as links to the Twitter, Twitpic, and Blogger pages.

EVALUATION

Overall•We will want to compare quarterly and year-end sales of the Equus before and after our campaign.

•Conduct a general survery to gauge the awareness of the Equus on the high-end vehicle market.

•Conduct a separate survey aimed at our target audience to assess if their perception toward Hyundai has changed.

•When an Equus is purchased, we will keep a record of how the consumer heard of the Equus, so that we can assess which methods were most effective.

•Because our Blogger account is powered by Google, we should measure our search engine optimization to see if it has improved.

ImplementationNumber of viewers of our television ad, number of listeners of our radio ad, number of magazines bought that contained our print ads, number of people who have subscribed to our blog, number of followers/friends on our social media sites.

ImpactNumber of people who can recall our ads, amount of interactive conversation taking place between Hyundai representatives and interested consumers, overall sentiment of online conversations about Hyundai’s Equus, any change in sentiment of these conversations during the course of our campaign.

BUDGET

WebNewspaperRadio (aired 10x’s in 748 locations)Billboards (x’s 12)Social Media CampaigniPhone App

Magazines for 6 MonthsAutomobileCar & DriverMotor TrendRoad & TrackLuxury Auto

TV for 6 MonthsABCCBSNBCFOXESPN 2SPEEDGOLF

3,0002,000224,40025,00042,0305,520

1,9503,9001,9503,9001,950

9,678,0001,382,0006,654,0002,490,0001,936,0001,936,0001,521,400

39,997,00039,995,00039,770,60039,745,60039,703,57039,698,050

39,696,10039,692,20039,690,25039,686,35039,684,400

30,006,40028,624,40021,970,40019,480,40017,544,40015,608,40014,087,000

Cost Remaining BudgetStarting Budget: $40 million

Production Costs1 TV ad3 Magaize ads1 Radio ad1 Billboard ad

Salary (22,600 x’s 5)

22,6003,0005081,500

113,000

14,064,40014,061,40014,060,89214,059,392

$13,946,392Remaining Budget

BUDGET cont.

HYUNDAI’S EQUUS · The goals of our campaign are to increase awareness of Hyundai’s Equus, its...

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