Posted by: Ihlwan Moon on February 5, 2010
Hyundai Motor made a splash in the auto industry with an aggressive marketing blitz last year. Taking advantage of Korea’s weak currency, Hyundai brought out a string of promotional packages, including its “Assurance Program” allowing buyers to return their cars and cancel their loans without hurting their credit ratings, if they lost their jobs. Now it is stepping up its sales pitch just as its admired and toughest rival Toyota, is suffering from one of the worst public relations crises in industry history.
The Korean automaker will burst into action with the Feb. 7 Super Bowl in America. It is due to run eight multi-million-dollar commercials on CBS, broadcaster of the 2010 Super Bowl, before, during and after the widely viewed game. The aim: to kick off its 2010 $160 million campaign promoting its completely re-engineered Sonata family sedan. The Sonata, which is being built in Alabama, will compete with Toyota’s top-selling Camry, Honda’s Accord and Ford’s Fusion.
Hyundai’s strategy of spending big during an industry slump has delivered results. Hyundai’s 2009 sales in the U.S. rose 8.3% to 435,000 vehicles; that was the biggest gain among major carmakers, even as industry demand plunged 21%. The Korean company’s net profit doubled to a record $2.5 billion last year when its global market share rose to 5.2% from 4.3% in 2008.
Hyundai is determined to keep up the momentum with the cash it earned. Marketing outlays by Hyundai headquarters in Seoul rose 23% to $1.25 billion in 2009. (Overall spending is higher, but its overseas subsidiaries don’t reveal details). Chaz Lee, managing director in charge of Hyundai’s overseas marketing, says his company is increasing marketing expenditure this year to help meet its target to increase its global share to 5.4%, but doesn’t give details.
The focus of this year’s Super Bowl ads is on its improving quality. One commercial that will run during the game proclaims that Hyundai’s paint quality is better than that of the Mercedes-Benz CLS 550. The other features famed Minnesota Vikings quarterback Brett Favre whose well-known tendency for changing his mind about retiring from football is used to promote Hyundai’s 10-year warranty. In a scene showing Favre undecided about whether to retire after winning an MVP award in the 2020 football season, the ad says: “But we can assure you that your Hyundai will still be covered by America’s best warranty” even then.