The General Motors Corporation emerged in 1931 as a leader in the US Auto industry. GM represents brands such as Cadillac, Chevrolet, GMC, Pontiac, and Hummer among others. In earlier decades, GM was responsible for introducing the world to iconic cars like the Camaro, the Corvette, the Seville, the Firebird, and most recently, the Escalade. The problem with these cars is that although they are beautiful, they do not appeal to consumers that are feeling the effects of the economic and environmental problems that we face in our current world. GM’s lack of focus on engine efficiency and keeping customers coming back has finally, after years of inattention to market focus and overall poor management, has finally sent GM into a much publicized and very controversial bankruptcy. Innovative and dependable car manufactures like Honda and Toyota have been taking a large portion of their US market share for many years and the bankruptcy is only adding to this long standing trend. The service, reputation, and quality of GM’s cars in recent years have declined forcing loyal US buyers to take their business elsewhere.
The bankruptcy was actually pre-packaged with history-making US Government involvement including the forced resignation of the CEO. The new CEO claims that GM has gained a new focus on “customers, cars, and culture” as clear priorities of their new philosophy and market focus. Notably, the word “customers” is mentioned first. To many Americans a new car is a luxury but it is still a car buyer’s market as the auto industry is extremely competitive involving both domestic and global competitors. GM needs to compete with both domestic and foreign car companies who have shifted the paradigm back to originally making the customer happy by providing reliable, cost effective and technologically innovative features and designs. Dependable older model cars still on the road today usually are not GM vehicles. The GM cars that are now priceless collectibles were manufactured in a time where early mass production was still balanced with quality and pride in craftsmanship. When a corporation is too large and poorly managed, they forget about the cornerstones that allowed the business to flourish. GM focused too much on wheeling and dealing in the car show room than making the best cars available. Combine this with poorly negotiated labor contracts that pay wages and benefits that are 50% higher and you have the makings of disaster. It’s like a GM salesman saying “Yeah, our cars are not as reliable but they cost more” … not a very appetizing value proposition. All this happened while others emerging in the industry were foreseeing the needs of today and were eager to advertise how they were plainly more reliable, were less expensive to own (lower price) and less expensive to run (higher gas mileage). Honda and Toyota have long marketed their cars and trucks centered on dependability, high residual value, and durability that keep money in their customers’ pockets.
The stereotype of GM is that of big powerful cars, big powerful gas guzzling engines, and lack luster interiors. Most car ads are based on gas efficiency as well as the design and comfortable interiors in even their lower end cars. In the past, GM advertising has used celebrities in their commercials to remind consumers of the old sentiment about riding in a “Cadillac” or “Chevy”. GM had a big advantage over leading foreign car companies; they are an original American car manufacturer. In general, most people favor this and using this argument in a commercial like they recently have will prove successful. However, Americans will only buy the cars that perform, prove to be dependable and provide a superior overall ownership experience.
Marketing counts! Word of mouth is a major factor in all buying decisions and buying your new car is no exception. The closest thing to word of mouth is the internet. Other car companies like Honda have had successful viral marketing campaigns by posting their cool commercials on YouTube. Honda’s focal point is on communicating eco-conscious models that are affordable for everyone. To engage a younger generation and re-introduce their brand, GM will need to use internet marketing effectively including viral marketing, PPC, Social Media, and even email marketing announcing sales and personal offer invitations to their existing customers. Reaching their existing customers on a personal level will make them feel exclusive and willing to do business again. Facebook would be a good tool to keep customers engaged and aware of the new changes for GM. Car Dealers are also going to have to clean up their act. They need to stop being about deal making and hard closing techniques. Your local dealer will need to become a valuable source of ongoing information using the social media, email marketing and search engine marketing. By doing these things they can be less about “getting you into something today” and more about establishing a trusting relationship and someone who can be relied upon when the time does come to get that new vehicle.
With their hoped-for new focus on customers, cars, and culture, GM could be headed in the right direction. They already have outlined their main priorities. Going forward, we will see how they use internet marketing and what the impact will be for their sales in the upcoming years.
The New Marketing Focus of General Motors
The bankruptcy was actually pre-packaged with history-making US Government involvement including the forced resignation of the CEO. The new CEO claims that GM has gained a new focus on “customers, cars, and culture” as clear priorities of their new philosophy and market focus. Notably, the word “customers” is mentioned first. To many Americans a new car is a luxury but it is still a car buyer’s market as the auto industry is extremely competitive involving both domestic and global competitors. GM needs to compete with both domestic and foreign car companies who have shifted the paradigm back to originally making the customer happy by providing reliable, cost effective and technologically innovative features and designs. Dependable older model cars still on the road today usually are not GM vehicles. The GM cars that are now priceless collectibles were manufactured in a time where early mass production was still balanced with quality and pride in craftsmanship. When a corporation is too large and poorly managed, they forget about the cornerstones that allowed the business to flourish. GM focused too much on wheeling and dealing in the car show room than making the best cars available. Combine this with poorly negotiated labor contracts that pay wages and benefits that are 50% higher and you have the makings of disaster. It’s like a GM salesman saying “Yeah, our cars are not as reliable but they cost more” … not a very appetizing value proposition. All this happened while others emerging in the industry were foreseeing the needs of today and were eager to advertise how they were plainly more reliable, were less expensive to own (lower price) and less expensive to run (higher gas mileage). Honda and Toyota have long marketed their cars and trucks centered on dependability, high residual value, and durability that keep money in their customers’ pockets.
The stereotype of GM is that of big powerful cars, big powerful gas guzzling engines, and lack luster interiors. Most car ads are based on gas efficiency as well as the design and comfortable interiors in even their lower end cars. In the past, GM advertising has used celebrities in their commercials to remind consumers of the old sentiment about riding in a “Cadillac” or “Chevy”. GM had a big advantage over leading foreign car companies; they are an original American car manufacturer. In general, most people favor this and using this argument in a commercial like they recently have will prove successful. However, Americans will only buy the cars that perform, prove to be dependable and provide a superior overall ownership experience.
Marketing counts! Word of mouth is a major factor in all buying decisions and buying your new car is no exception. The closest thing to word of mouth is the internet. Other car companies like Honda have had successful viral marketing campaigns by posting their cool commercials on YouTube. Honda’s focal point is on communicating eco-conscious models that are affordable for everyone. To engage a younger generation and re-introduce their brand, GM will need to use internet marketing effectively including viral marketing, PPC, Social Media, and even email marketing announcing sales and personal offer invitations to their existing customers. Reaching their existing customers on a personal level will make them feel exclusive and willing to do business again. Facebook would be a good tool to keep customers engaged and aware of the new changes for GM. Car Dealers are also going to have to clean up their act. They need to stop being about deal making and hard closing techniques. Your local dealer will need to become a valuable source of ongoing information using the social media, email marketing and search engine marketing. By doing these things they can be less about “getting you into something today” and more about establishing a trusting relationship and someone who can be relied upon when the time does come to get that new vehicle.
With their hoped-for new focus on customers, cars, and culture, GM could be headed in the right direction. They already have outlined their main priorities. Going forward, we will see how they use internet marketing and what the impact will be for their sales in the upcoming years.