Twitter
Andrew Davidson 
Susan Menke 
Susan Wolfe 
Daniel Hayes 
Lisa Hronek 
Chris Zagorski Posts Tagged ‘Auto’
Auto news: Mercury out, Lincoln to be American luxury brand
It was announced in early June that Ford plans to discontinue the Mercury brand at the end of this year.
To those in the auto industry, this is not surprising news as Ford has alluded to its desire to concentrate on its more popular brands. It also shouldn’t be surprising since the Mercury brand currently accounts for less than a 1% market share in the US.
As part of Ford’s refocus, the company announced plans to expand the Lincoln lineup over the next four years.
Ford appears to be adopting the strategy used by both Chrysler and GM by aligning quality/status more with brand than with make or model.
I think the idea is that Lincoln would represent the luxury brand of the Ford Motor Company. Currently there are around 1,700 Mercury/Lincoln dealers in the United States (which will likely turn into Lincoln dealers soon).
Do you think the Lincoln brand, with an expanded lineup, can compete with the likes of Cadillac to be the king of American-made luxury cars?
Battle to be first electric car “sparking” hot
In all of my excitement to report about Nissan’s March 30, 2010 press release on the all-new Nissan Leaf, I totally overlooked an announcement from General Motors. On the eve of the 2010 New York Auto Show (the same day Nissan issued its press release), General Motors announced that the new 2011 Chevy Volt would be available on showroom floors in November 2010. How could I have not blogged about this at the same time?
For those of you who don’t know, the Chevy Volt is also an electric car that, according the company’s website, can create its own electricity. When fully charged (accomplished by plugging the car in overnight), the car can run 40 miles on pure electricity. After about 40 miles, a “range-extending gas generator” kicks in, which recharges the battery and adds up to 300 drivable miles on a single tank of gas. The ability to have a car re-generate energy will be a strong selling point in why consumers should pick the Volt over the Nissan Leaf. A jump start on sales won’t hurt either.
So I have to ask: who has been holding out to be a part of the first generation of electric car owners?
Toyota brand still strong as sales zoom into the fast lane
Just seven months after a global recall of roughly 8.5 million vehicles, Toyota is enjoying increased car and truck sales. At the end of March, sales were expected to be 30-35% higher than they were last year. In the first ten days alone, sales surged a whopping 40% compared to early March 2009. Various incentives previously unheard of from Toyota, coupled with their effective catering to loyal customers have helped the company bounce back quicker than expected.
Some notable incentives include:
• Zero-percent financing for the first five years on its top-selling models
• The introduction of the “Toyota Auto Care Premium Package” that includes oil changes and other maintenance services for free over two years for the purchase or lease of any new vehicle
• Cash rebates ranging from $500 to $3,000 depending on the vehicle
Toyota made all the right moves to regain customer confidence and attract first-time buyers. The company admitted fault and was openly communicative with the press. They then made restitution with the aforementioned incentives to quickly resolve a crisis that might have left other competitors in dire straits. A crisis that could’ve ruined the Toyota brand and image seems to have only made the company stronger.
Auto insurance direct mail strategy: Progressive on hiatus
Progressive has all but stopped acquisition mailing. In 2009, they sent 90% fewer offers than in 2008. So far this year, Mintel Comperemedia has only tracked one auto insurance piece from Progressive. It was a card mailed by Florida Insurance Specialists to clients with a homeowner’s policy and offered a discount for Progressive auto insurance.
Progressive’s strategy to stop using direct mail is the opposite of GEICO, State Farm and Allstate, all of which have increased efforts. These auto insurance leaders have either maintained high mail volumes or increased mailings since last year.
GEICO, the largest auto insurance mailer, sends a letter as its top offer. Interestingly, it is not branded with any of the characters GEICO has developed. It does, however, have a call-to-action header: “Do not discard this letter without first visiting geico.com.”
Allstate and State Farm are next after GEICO. Each sends letters that feature a quote card, a box showing savings over the competition, and an agent’s phone number.
Maybe the reason Progressive has stopped mailing is because it is enamored with the overwhelming success of Flo and the Insurance Superstore campaign. But State Farm, Allstate and GEICO seem to be increasing direct mail alongside successful campaigns in other media.
How long will Progressive maintain reduced direct mail as part of its marketing strategy? Please contact me if you’re interested in exploring this idea further (DHayes@Mintel.com).