Driving
the Future
Positioning your brand to create
desire in the new automotive reality
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?
The Lippincott Brand Study
The data in this piece is drawn from the Lippincott Brand
Study, a 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.
The Lippincott Brand Study 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.
S e n s e P e r sp e c t i v e
2
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?
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.
‘Look at me...’
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.
S e n s e P e r sp e c t i v e
3
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.
‘...Think about me’
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
S e n s e P e r sp e c t i v e
4
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.
Brand momentum - US
Leading
Lagging
Middle of the pack
1:10
10:1
Ratio of Best days ahead : Best days behind
Brand momentum - China
Leading
Lagging
Middle of the pack
1:10
10:1
Ratio of Best days ahead : Best days behind
2
S e n s e P e r sp e c t i v e
5
thefuture,
future,
InInthe
whichone
one
which
willI Ilove?
love?
will
S e n s e P e r sp e c t i v e
6
4
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 the Lippincott Brand Study research, we believe that
building tomorrow’s leading automotive brands
will mean acting on four key imperatives.
S e n s e P e r sp e c t i v e
7
be distinctive...
By defining the characteristics that
make the brand truly unique, and why
they matter to people
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.
S e n s e P e r sp e c t i v e
8
Composition of brand personalities - US
Premium brands in the US have a very similar personality profile
Allowing you to achieve greatness
Giving you
freedom to
explore and
discover
Being strong and serving as a leader
Audi
BMW
Mercedes
Lexus
Infiniti
Composition of brand personalities - China
Premium brands in China have profiles linked to national provenance
Allowing you to achieve greatness
Giving you
freedom to
explore and
discover
Being strong and serving as a leader
Audi
BMW
Mercedes
Lexus
Infiniti
be authentic...
By being true to the essence of what
makes the brand special, while staying
relevant and vital
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.
Authenticity vs. Loved - China
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.
Story vs. Experience
In China, people love the brand they find to be highly authentic
BMW achieves a remarkably consistent performance across markets
Industry average: 106
140
180
120
Loved
Experience power
100
80
60
0
20
40
60
80
100
120
140
Experience power
220
Industry average: 106
160
160
TRIBAL
LEGENDS
140
100
60
20
20
160
UNATTACHED
60
Authenticity
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.
S e n s e P e r sp e c t i v e
9
STORY TELLERS
100
140
180
220
Story Power
Composition of brand personalities
BMW flexes its supporting brand characteristics across markets
Allowing you to achieve greatness
Being strong
and serving
as a leader
Sense of
wonder
Letting you indulge
US
China
UK
Brazil
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.
S e n s e P e r sp e c t i v e
10
Composition of brand personalities
Hyundai over indexes on traits relevant to Generation Y
versus US domestic brands
Helping make life more fun
Helping you
experience a
sense of
wonder
Challenging
convention
Letting you be who you are at heart
Chrysler
Dodge
Chevrolet
GMC
Hyundai
Composition of brand personalities
VW has a differentiated personality profile between generations
Helping make life more fun
Helping you
experience a
sense of
wonder
Challenging
convention
Letting you be who you are at heart
Under 35
Over 35
be immersive...
By creating compelling, seamless
experiences that deliver the brand
beyond the vehicle
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
Value brand ranking - US
“This is a brand I love”
160
RANK
RANK
1. Lexus
1. Lexus
2. Toyota
3. Nissan
140
4. Chevrolet
7. Ford
8. Chrysler
100
Traffic
Management
Remote
Services
9. Dodge
10. GMC
80
80
Japanese brands
S e n s e P e r sp e c t i v e
Car Sharing
Services
6. Chevrolet
8. Infiniti
10. GMC
American brands
3. Toyota
7. Dodge
9. Chrysler
Economy
Maximization
5. Infiniti
120
6. Ford
2. Honda
Intelligent
Route
Planning
4. Nissan
5. Honda
100
New touchpoints are becoming core to the experience
“This brand makes me feel great”
160
120
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.
New digital ecosystem
Japanese brands lead domestic brands in the value market
140
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.
11
Congestion
Avoidance
Public
Transport
Integration
Driving the future
In the new automotive reality, a renewed focus on brand
building will be key to being both relevant and desired.
Being distinctive
Being relevant
will protect brands from the need to compete on
increasingly narrow functional and performance differences
will allow brands to sustain excitement and loyalty
across different customer groups, driving long-term
brand advocacy
Being authentic
will give brands the consistent foundation from
which to adapt credibly to multiple geographic and
demographic markets
Being immersive
will stretch the brand into new propositions, value-added
services and emerging parts of the mobility value chain
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.
Questions to ask:
•A
re 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?
• 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?
•A
re 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?
• Can you translate your brand into experiences beyond
the vehicle, embracing new and emerging physical and
digital environments?
About Lippincott
author
Lippincott 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 Stuart
Partner, Brand Strategy
dylan.stuart@lippincott.com
www.lippincott.com
© 2013 Lippincott, a division of Oliver Wyman, Inc.
NEW YORK • BOSTON • SAN FRANCISCO • LONDON • PARIS • HONG KONG • SÃO PAULO • TOKYO