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Deep inside General Motors Corp. headquarters in Detroit, the marketing team studies a chart that tells them which brands of consumer products car shoppers equate with GM nameplates. Saturn does well, clustered near Panera Bread, a hot brand that evokes comfort and quality. On the other hand, Chevy, Buick, and Pontiac, three of GM's best-sellers, "are way too close to Burger King," says Paul Ballew, executive director for global market and industry analysis at GM.
Gaining consumers' respect is one of GM's biggest challenges. It can restructure the company. It can cut a new deal with labor. But if it can't convince people that it makes quality vehicles, the other initiatives won't pay off. Internal GMsurveys indicate that consumers think GM's vehicles are far less fuel efficient than Toyota Motor Corp.'s, yet GM has 23 models that get 30-plus miles per gallon--more than Toyota or Honda Motor Co. offer. And while J.D. Power & Associates Inc.'s quality rankings place Cadillac, Chevy, and GMC nearly on a par with Toyota and Honda, those numbers haven't translated into public trust. "Actual quality is so close, but reputation for quality is another issue,"says Jeff Zupancik, J.D. Power's director for retail research.
GM is making its most concerted effort ever to close what sales and marketing chief Mark R. LaNeve calls "the opinion gap." It hired a new ad agency, Deutsch LA, in the heart of GM's most hostile territory, southern California, to produce ads around its 100,000-mile warranty for new cars, quality gains, and the fuel economy of its models. It also wants Deutsch to figure out how GM might use Buick spokesman Tiger Woods to promote GMas a whole. Most important, GM is committed to building a more consistent image. Buick has had five ad campaigns since 2000, and Pontiac and Saturn have had four apiece.
To get a better read on consumers, GM is changing how it does research. It's targeting a segment many automakers ignore: the "total avoiders." A J.D. Power study concluded that 25% of buyers don't consider GM brands because of reliability concerns; for Toyota, that segment is just 4%. Ballew says the group avoiding GM is too big--and full of younger buyers. "We have to find a way to break through that barrier," he says, or suffer as older Buick, Cadillac, and Chevy buyers die off.
Deutsch and GM are relying more on one-on-one customer interviews to point the way. That's how GM learned that customers feel the new warranty is worth about $2,300--good news since GM is cutting rebates. But other interviews, like one with a young pickup buyer, highlight GM's challenge--he bought a Chevy truck purely because of the discounts. The brand meant nothing to him.
Eric Hirshberg, Deutsch's co-president and creative director, says the agency is crafting a "confident" image and discarding ads that seem defensive. The warranty ads aim to evoke a feeling of freedom and power by showing GMcars escaping traffic by flying over other cars. Agency co-president Mike Sheldon said they adopted a trick that's guiding the work: "We pretended it was Apple Computer."
GM is now launching a series of crossover SUVs that it has reason to be confident about. The Saturn Outlook, for one, has been widely praised by the auto press, and its fuel rating beats the Honda Pilot. "But if a consumer shops the two together now," says LaNeve, "We lose on brand image."
By David Kiley