Daily users researching the Ford Explorer more than doubled on Jumpstart Automotive Group properties on July 26, the day of the Facebook unveiling, compared to the average daily usage for the month of July. The tactic proved successful in driving 104% more people to Explorer pages on that last Monday in July, and the aftereffects were compelling as well, as Explorer rounded out the week with successive daily improvements in usage (vs. the monthly average) of 66%, 25%, 13% and 8% by Friday.

Explorer’s growth in shopping and engagement during the Facebook reveal also led to Explorer capturing greater share of SUV shoppers by as much as 52% during the event, and 31% the day after. After trailing Jeep Grand Cherokee — which also recently launched a new design for 2011 — for most of July, Explorer soared ahead of it, and the rest of the competition, for the remainder of the month as shown in the chart below.

The type of growth in share Explorer enjoyed from its Facebook reveal bested improvements in share of shopping that manufacturers experienced the day after running one or more 30-second Super Bowl spots. When Jumpstart analyzed the post-game results of automotive advertisers in the 2010 Super Bowl, the average share of shopping growth was only 14%, less than a third of Explorer’s growth from its Facebook reveal.

While the cost associated with the Explorer reveal program on Facebook is unknown, it was likely nowhere near the cost of even one $2.5 million Super Bowl spot. This development demonstrates that while traditional media can be highly effective in driving consideration, a well-executed and deeply influential online program can shift intent with more immediacy.

It’s a cliché to say that times are changing, but it’s evident that this is a rapidly evolving industry when an auto manufacturer chooses a social media website to unveil a new design over the conventional outlets.

The Ford brand has officially separated itself from the pack. Through May 2010, Ford’s share of shopping on Jumpstart properties is now 10% greater than Chevrolet, helping to maintain its spot as the No. 1 shopped and researched brand. Ford earned the No. 1 position roughly midway through last year, but finished 2009 only 1% greater than Chevy. Ford has stretched its lead on Chevy by 10% and is 30% ahead of Toyota, a brand whose share of shopping has tumbled in 2010 mostly due to recent recall issues that have stymied the brand via the press.

When Jumpstart examined engagement activity for the five brands via its Brand Engagement Index, similar results were discovered. Ford’s engagement levels increased in 2010 to pull away from competitors Chevy and Chrysler. Chevy and Chrysler have each seen a steady decline in activity since Sept. ’09 of about 3% per month, and Honda has dropped 13% in engagement from Jan. through May 2010 vs. the same time last year. The index is calculated by measuring the overall usage and level of engagement with a brand’s content on Jumpstart’s properties.

The shopping patterns observed have also manifested into sales activity, with Ford enjoying 30% sales growth through May (vs. the same period last year). Vehicles like the Focus, Taurus and Fusion are challenging historic segment leaders, and F-Series is sailing past the competition with 35% sales growth through May.

The 2010 surge achieved by Ford reflects a continuous improvement in Ford brand perception and awareness, as well as the implementation of industry-leading technologies like Sync, and vehicle redesigns and refreshes that consumers find appealing.

This positive awareness and sales momentum will likely continue for the foreseeable future as well, since Ford’s red-hot Fiesta has yet to arrive in U.S. dealerships. The interest and buzz associated with Fiesta has been staggering, thanks to Ford’s plan to begin generating awareness of the vehicle 18 months prior to its availability to consumers via the Fiesta Movement. By putting this product in the hands of an influential and well-connected audience, this innovative campaign has not only driven awareness of the Fiesta, but has undoubtedly been instrumental in Ford’s brand success as well.

On Jumpstart’s properties, Fiesta has seen activity soar by 71% in May vs. its 2010 average, significantly ahead of segment leaders like Honda Fit, Chevy Cobalt and Toyota Yaris. Fiesta’s audience gains have also effortlessly surpassed other buzz-worthy upcoming launches including Nissan Leaf and Chevy Volt, with Leaf’s consideration down 36% and Volt’s remaining flat

At this trajectory, it will be interesting to see how consumers respond to Ford in the second half of 2010, as the brand looks to be positioned for tremendous growth this calendar year.

Final Thought: The difficulties experienced by some of the companies in this study is a reflection of the challenges that brands like Toyota, Chevrolet and Chrysler have experienced in recent memory. Toyota’s recall issues earlier this year cast a difficult shadow on a previously unshakable brand, which essentially speaks to a product issue. Chrysler and Chevrolet (via GM) are still struggling as a result of acceptance of government loans and subsequent bankruptcies last year, alluding to a perception issue.

What Ford has demonstrated in these findings is that it requires a combination of good product, sound marketing – and some competitors with communication challenges – to enjoy this type of separation in the marketplace.

When lives are lost due to defective products, consumers panic and have no qualms about simply washing their hands of a brand all together. They possess that power and will wield it any time it’s necessary. Just ask Ford Explorer circa 2000, Tylenol circa 1982, or Trans World Airlines (1996).

Through Jumpstart Automotive Group’s in-market shopping and influencer sites, we’re seeing this overpowering effect on Toyota occur immediately. We analyzed the transgressions of the Toyota brand over the past few days, uncovering some intriguing points of interest. Over 1,000 responses were tallied to reveal that the Toyota brand is currently in need of serious life support, with in-market consumers swiftly shying away from considering a Toyota vehicle.

The results of a recent poll of Jumpstart’s automotive site visitors indicated the following:

• 51% indicated that Toyota’s issues have changed their perception of the brand, leading them to eliminate Toyota from their consideration set for their next vehicle purchase
• 33% said they still may consider Toyota if they decide to delay their vehicle purchase
• 16% will still consider Toyota and believe the automaker will get through this period successfully

Toyota’s shopping activity has also fallen in the past week by 11% on Jumpstart properties, indicating waning interest in the typically stellar brand.

For Toyota’s marketing leaders and crisis managers, the work needs to start quickly and with complete transparency. History has proven time and again that honesty is the best policy in winning back disenchanted consumers. This is a country that wholeheartedly believes in second chances — professional athletes (see Michael Vick, Kobe Bryant), and even brands like Tylenol and Explorer have surged ahead after public thrashing. We listen to apologies and applaud honesty. We forgive, we forget, we move on.

For the near term, however, Toyota will inevitably lose market share to its competitors (already reportedly down 16% in January year-over-year, when direct competitors were ahead). Previously loyal Toyota/Lexus owners will begin to explore other options (Polk recently ranked Toyota No. 1 in Overall Manufacturer Loyalty for 2009). Toyota’s largest challenge will be winning back the defectors, and the amount of time and marketing dollars that it takes will likely be costly.

Who will win over the disgruntled Toyota customer?

We asked consumers on Jumpstart properties who indicated they’ve eliminated Toyota from their consideration set. The results overwhelmingly favored the domestic auto companies — over 80% of the respondents named a Ford, Chrysler or GM brand.

• 48% indicated that Chevrolet tops their list to replace Toyota for their next vehicle purchase.
• 17% Ford and 14% Chrysler
• Hyundai was next with a promising 12% and Honda with 7%

This data provides some interesting perspective about the mindset of U.S. car shoppers. It seems they’ve been waiting for a reason to support the domestic auto brands and experience what these brands have to offer.

It looks as if this Toyota debacle will present its competition an opportunity greater than any incentive, clunker program or savvy marketing campaign. In fact the Detroit Three, as well as Hyundai, is offering thousands in incentives for Toyota owners looking to buy a new car.

In the spirit of the Super Bowl, Toyota has committed a turnover, and after a long, drawn out period of playing nothing but defense, the domestics are now on the offensive.

It seems all of the old and tired approaches to incentive programs simply continue to resurface without much innovation. Employee pricing, cash back, and financing incentives are old news. When everyone’s doing it — and in 2009, everyone was doing it – to the consumer it translates to white noise.

In 2009 Hyundai broke through that clutter with its Assurance Program, which promised the consumer the ability to return their vehicle if they lost their job. It resonated with consumers and was extremely timely — and most importantly, out of the box. The copycats followed but none enjoyed the impact that Hyundai felt from this ground-breaking approach.

The Cash-for-Clunkers program also proved that trading in your old car — typically a nerve-wracking process that rarely makes anyone happy with the end result — can be a good experience when structured the right way and positioned as motivation to purchase a new car.

I’ve been thinking about incentives for 2010, in the hopes that OEMs won’t continue to repurpose the worn out slogans and overused enticements. One of the greatest hurdles that the larger automotive companies are struggling with is loyalty. According to a Sept. 2009 study by ChangeWave Research, only 28 percent of Chrysler owners plan on buying another Chrysler vehicle, the lowest among all OEMs. Some of the surprises also at the bottom of the list include Mercedes and Volkswagen, while GM is in the middle of the pack at 53 percent. Toyota and Honda maintain the most loyal owners at 71 and 69 percent, respectively.

Specifically for General Motors and Chrysler, going through bankruptcy and dissolving vehicle brands has and will continue to have negative effects on their ability to entice return customers. Through well thought out and unique incentive programs, these brands might be able to gain back some of their lost ground.

GM could explore an incentive idea that spurs greater loyalty and gives them the ability to re-engage potentially disgruntled consumers through a valuable trade-in program. Similar to Cash-for-Clunkers, here’s an example of how it could work for GM:

• For owners of current or orphaned GM brands (Pontiac, Saturn, Saab, Hummer), GM could offer a guaranteed minimum trade-in amount, with a scale of these dollar figures based on the year of the trade-in vehicle. This would allow GM to continue to reinforce its guarantee on quality that it has been preaching through the current 60-day money back guarantee program, and would promote the fact that they’re serious about winning back disappointed customers and owners of former GM brands that have either been sold off or had their doors shut. Current GM owners are ripe for the picking from competitors, making a sound incentive strategy ever more important in 2010.

Chrysler has a perception gap it needs to fill, and while a similar loyalty program might be effective, Chrysler may be better suited to employ a conquest-driven format that encourages non-Chrysler owners to try them out. For example:

• For owners of competing vehicle models (these can be specified by Chrysler), guarantee a minimum trade-in amount if they purchase a new Chrysler vehicle, with dollar amounts also scaled by the year of the trade-in. This demonstrates Chrysler’s confidence in its own vehicles and a mechanism to capture new buyers who may not have considered Chrysler in the past. Ultimately this leads to winning back market share that Chrysler has lost in a big way in 2009.

Once again, the end goal of all incentives is the same — sell more cars by creating the perception that the cost is being discounted. If in that process a manufacturer is able to improve opinion of its brand, capture greater market share, or win back disgruntled or disenchanted customers, the rewards — as we’ve seen with Hyundai — can be abundant.

Have you experienced or heard about other incentive programs that are ground breaking and effective? If so, I’d love to hear about it.

Consumer confidence improved slightly in November and has held steady at around 50 after plummeting to below 30 in May. Reported unemployment declined slightly to 10% from 10.2%. Industry analysts are forecasting growth in volume and ad spending for 2010. For some, LA was the stage to tell a great story, for others LA confirmed continuing difficulties, and for some it was a non-event. They didn’t even bother to show.

The Winners

Hyundai stormed the show and was clearly the star. Building on the momentum achieved in 2009, they introduced the new Sonata mid-sized sedan and new Tucson crossover utility vehicle. Styling, interior packaging, fit and finish, and feature content were simply outstanding for both products. They’ve achieved industry leading fuel economy and are committed to building on their leadership position. Expect them to be the industry success story in 2010.

Audi was brilliant. Their product, presentation, and presence dominated the show. With more new product arriving in 2010, they will achieve additional share gains in the coming year.

Ford continued to separate itself from the other domestic brands and is re-establishing itself as an industry leader. They have a sound plan and are executing against that plan with great consistency. Fiesta was the star of this show. The marketing pre-launch has been a breath of fresh air, building the foundation for a hugely successful market introduction. The executive team at Ford is doing a magnificent job of polishing the Blue Oval. Ford is the American car company.

The Losers

Chrysler. Although they upgraded their show presence from last year, their display still lacked luster, resembling a parking lot that did very little to drive consideration of their products. They clearly struggle with brand separation, their products aren’t the strongest in their respective segments, and they aren’t telling any compelling stories. As a result, their sales are down 25% (for November) in an industry that is now stabilizing. It is going to be a struggle for Sergio Marchionne to manage cash flow and/or revenue until new technology and new product arrive.

General Motors. First they fired their CEO the day before he was scheduled to give the keynote address. Next, they hastily flew their Vice-Chairman and most compelling evangelist back to Detroit. At the show, they spent a ridiculous amount of time talking about their inventive, socially hip approach to color naming and left everybody wondering about their products. Although they have better product than they have ever had, in some cases fully competitive with segment leaders, they continue to lose the significant marketing and PR battles. Taxpayers may never be repaid.

Nissan. It’s hard to call either Nissan or Infiniti a loser when they didn’t even bother to show. The LA show attracts an audience of leading industry journalists and approximately one million paying automotive enthusiasts and car shoppers. It’s one of the only places an auto maker can display their brands and products in a completely controlled environment. Even if you don’t have new product to share, it’s hard to understand why you wouldn’t take advantage of the opportunity to tell your story and present your products. This was the perfect opportunity to show potential customers the new Nissan Leaf and demonstrate leadership in electric technology. It was the perfect opportunity to show the stunning new Infiniti M37, squarely aimed at the Southern California luxury market. Missed opportunity.

John Noble, one of the more famous Doyle Dane Bernbach Creative Directors used to tell a joke that made account weasels wince.

According to John, a woman went in to see the same judge for the third time in what appeared to be a very short period. The Judge looked at her and demanded why she kept clogging up his calendar.

The woman replied: “Well, your honor, my first husband was an older man, and by the time he got interested, I was asleep.”

“My second husband was a younger man, and by the time I got interested, he was asleep.”

“Well.” demanded the judge, “what’s wrong with the third man?”

“Your honor,” replied the woman, “my third husband is in advertising. He just sits on the foot of the bed all night long telling me how good it is going to be.”

Unfortunately, John was less than half wrong…then and still.

Marketing is a Team Sport

Marketing is a team sport. If it is going to work, it needs to touch anyone and everyone who comes in contact with the customer, from the lady who makes the payments to the guy who sweeps the floors.

The marketing group needs to provide the agency with something it can talk about.
And everybody needs to understand that absent profitable sales, there will be no budget. But far too often, a client in desperate need of a positive sales bump is offered reorganizations and rehashing of old ads and strategies. Maybe even a creative director asking, “Do we really need this ad?”

It is usually up to the account weasel who has responsibility for everything that happens with the client, but authority over none of the people working on the clients business, to come up with a fix.

Since the account weasel is asking the agency to do work… this is called spending money… and everybody else, from senior management to the traffic department, doesn’t want to do more work, the result is perfectly predictable:
The agency introduces the client to their “Great New” account manager who will fix the client’s problems with the snap of his fingers while the rest of the agency remains un-annoyed by client requests for new work.

When the client figures out that his agency’s management is more interested in its own numbers than his, and is therefore cutting staff in advance of his budget reductions, rather than investing in him and their relationship as they would if it were a new business opportunity, he generally calls a review. This is what remains of the old white shoe advertising behavior we grew up with. Review is a polite way of saying; “You’re fired.”

The new agencies sniffing after the client’s account are still expected to invest between $250 thousand and half a million bucks to “pitch” the business. But clients are increasingly unwilling to help even the winning agency recoup the costs of pitching the business…and many don’t bother.

Good People Not Necessary

The Business of “New Business” is now dominated by consultants analyzing media costs and creative fees, and advising “you really don’t need good people.” The impact of the creative campaign has become a secondary consideration, as is the chemistry between the agency and client operatives who are supposed to produce advertising that will give the client an edge, and the agency new business opportunities.

(Chiat/Day promised Lee Clow would be directly involved in the Nissan business knowing full well they had already promised 500% of Lee’s time to other accounts. When Hyundai complained about the 25% of his time Carl Spielvogel had promised to the account, Carl explained that the Hyundai allocation was not composed of his “regular time,” but the “overtime” he dedicated to the Hyundai business.)

If all of this sounds insane, it is. Why an agency would refuse to invest additional creative resources to a long-term client fighting for survival… or why a client would hire a new agency who will insist that their product first needs to be “repositioned” with a series of multi-million dollar ads that may or may not include any reference to the product, and then should be given a year of on the job experience is beyond logic.

Blame it on the agency culture developing across the world. Half of what used to be agency income is now devoted to paying down the debt agencies owe to the fat old men who founded the joint.

The Cost of Eyeballs

The funny thing about all of this is that media distribution is one of the few markets that are actually working.

The cost of eyeballs is pretty much a constant. For every medium that gains a hundred thousand of same, somebody somewhere else loses them. The winner raises his prices, the loser lowers his, and all is right with the universe…so let us not speak badly of our media generation; let us not speak well of it either; let us not speak of it at all.

What we seem to be doing is forcing traditional media to compete with the CPMs or Click Throughs, or whatever is achieved by digital media.
As a result, we are pitching new business with Internet viewer costs while assuming the impact of a digital ad is the same as the impact of more traditional-based media advertising.

Internet Advertising Still a Mystery

This is an industry that sells itself on the basis of its ability to move awareness and impressions North. But the cost of Internet ads is still not understood and can’t be measured in any way that does client-marketers any good.

In the mean time, we are undercutting the income of traditional media to the point where they can no longer afford to hire the editorial staff that brings in the readers that we, as advertisers, want to buy.
So we wind up spending more money to get the same impact even at cheaper prices.

I understand that this is a new world, and just because I’m writing on the Internet doesn’t mean I know what I’m talking about. But advertising impact, like most things, tends to follow a normal distribution pattern: 10% of the work is extraordinary; 10 % of the work is just awful; and 80% of the work is just there.

Academics have crunched these numbers to the point where they can demonstrate by facts and figures that a 1% increase in creative performance is 20 times as efficient as a 1% increase in media spending.

The problem is nobody quite knows how to measure creative performance, at least before the fact. And almost by definition, creative impact involves a fresh look at how to say what you want the consumer to hear.

No client ever got fired for doing exactly the same thing as everybody else.
Missing from the equation are respect and trust; two virtues our agency selection process seems to attempt to intentionally eliminate, along with the magic of creativity.

A Good Meeting — and the Genie

There is a story of a copywriter, an art director, and an account weasel huddling in an Upper East Side bar, decorated with ferns and recently reproduced seventeenth century sea-going brass.

They had just survived what we in the business call a “good meeting.”
Drinks were served. Note pads were spread out on the table, when a Genie sprang out of the (real, antique) lamp the copywriter had been fondling at the table. An enraged Genie appeared, and struggling to pull a fern fond from his exhaust port, looked at the three advertising weasels muttering, “Jesus, not another Upper East Side Fern Bar,” caught their eyes, and announced that the rules had changed. They would get one wish each, and he would be gone. Staring at the copy writer he demanded,

“What do you want?”

The copy guy responded; “I want to go to the Florida Keys and write the next great American novel.”

“Is that all?” The Genie snapped his fingers, and the copy man was gone.

“And what do you want?” Now glaring at the Art Director.

Without missing a beat the Art Director announced he wanted to go to Paris to lead the direction of the next great art movement.

“That all?” said the Genie. Snapping his fingers again, the Art Director was gone.

Finally, the Genie looked at the account weasel and demanded, “And what do you want?”

The account weasel looked around the booth, around the bar, down at his notes, and finally back at the Genie.

“I’ll tell you what I want,” said the account weasel, “I want those two asses back here right now.”

The story is closer to client perceptions of the agency business that many might care to think.

Jimmy Sanfalippo, head of Marketer of the Year Hyundai’s in house advertising agency attributes his success to “Clarity at the top and talent in the ranks.”

Until agencies can figure out how to create a similar respectful and trusting relationship with their clients…one in which the client knows we are dedicated to solving her problems…we will remain sitting on the end of the bed, telling her how good things are going to be.

But now hybrid cars are officially out of futuristic mode and more mainstream than ever. They no longer only come in two sizes – small or boxy. Hybrid technology is present in anything from a Civic to an Escalade, as automakers slowly begin to recognize that people want efficiency and cargo space. Jumpstart Automotive Group’s traffic trends also tell a more vivid story about the influx of hybrid interest.

Demand for hybrids has grown rampantly this year, in some cases upwards of 150% when comparing the first half of the year to the second half on Jumpstart’s properties. Ford Escape Hybrid watched interest boom in the second half of the year by a 156% clip, along with Honda Civic Hybrid (+131%), Toyota Prius (91%), Mercury Mariner Hybrid (+45%), Ford Fusion Hybrid (+40%), and even the now defunct Saturn Vue Hybrid (+92%).

The most recent growth period took place in October, once all of the Cash-for-Clunkers hype fizzled. The average growth of the aforementioned vehicles in Oct. was 38% when compared to the second quarter, with Prius and Civic Hybrid enjoying 46% and 36% boosts, respectively.

Brands like Toyota, Honda and Ford are paving the way with hybrid marketing that’s meant to educate and focus on the product, and not on an incentive or financing promotion. And they’re investing a lot more in this education process in 2009. Media spending on hybrid-specific messaging has nearly doubled through August when compared to the same time period last year, according to TNS’s AdSpender report, with Toyota, Honda, Ford and Chevrolet contributing the largest share.

The messaging for hybrid vehicles is distinctly more feature-oriented than most incentive and price-driven car ads seen today, helping differentiate these products and draw attention to the car and its benefits. Toyota has identified so well with fuel efficiency by successfully weaving the green message into nearly every campaign it puts out. Honda’s approach to hybrid, as has typically been the case for its campaigns, is a very upbeat message with plenty of animation, color and feel-good music. On the flip side, Ford’s hybrid spots have ranged from very business-like, focusing on MPG and being “the most fuel efficient,” while also promoting the human element through its recently launched The Ford Story.

Some of the more memorable hybrid creative executions from this year include:

• Toyota Prius: The Third-generation Prius TV spot waxes poetically on the “Harmony between man, nature and machine.” What’s effective about this campaign is its consistent messaging through television, print and digital, along with its aesthetically pleasing color scheme and product-focused message. The digital ads maintain a similar look and feel while touting the 50 mpg rating as its payoff.
• The Ford Story: Ford’s “The Ford Story” campaign brings numerous consumer testimonials to life in the form of video spots. There’s also a suite of these spots that are geared specifically toward green stories that consumers are telling. These spots are engaging, touching and very effective at delivering a testimonial in a tasteful and authentic manner.
• Honda Insight: Honda’s approach was to create a comfort level around hybrids and bring them to the mainstream in terms of design and price. One of the ads declares: “The hybrid for everyone is here. The Insight, designed and priced for us all.” It’s right in line with Honda’s successful high spirits messaging style, with the song “We are all in this together” as the backdrop.
• Ford Fusion Hybrid: The Fusion Hybrid campaign across all media is effective because it is simple, direct and poignant. The tag states: “Save 700 miles on a single tank … the most fuel efficient midsize sedan in America.” The payoff is the miles (translation: dollars) saved with a hybrid, not the cash back or financing dollars touted.

The numbers don’t lie — hybrid is no longer hype. “Green” is no longer just a buzz word but a way of life. It has consumers thinking harder about their decisions, and it has more of them researching to understand as much as they can about fuel efficiency, carbon footprint, and the environment they’re ultimately leaving behind for their children.

Despite the current difficult automotive environment, OEMs are doing an admirable job educating consumers about hybrids by bridging the gaps between people and technology.

It’s not hard to figure out why. For many people, this week starts the countdown to the holidays and New Year’s—the time when last year’s problems get swept away, and one gets the chance to breathe deeply and shake off the miserable fugue that has rocked the foundation of this normally optimistic country.

During Thanksgiving people set aside time to think about what happened, and why, and take a few moments to make sense of the world swirling around them. It is a uniquely American holiday. It represents the spirit of a hopeful people who, by planning or by chance, have landed in a new place, and decided it is HERE that things will be better. It is HERE that things will be different.

Inevitably, this leads to a listing of what makes us hopeful. A list of things that validate the decisions of the past, and things that improve our outlook for tomorrow. And so, it is here in this semi-regular blog that I also feel compelled to tell you what I’m thankful for.

I am thankful that General Motors and Chrysler moved as quickly as they did through bankruptcy. The thought of two-thirds of the American car industry in bankruptcy (representative of a languishing manufacturing sector in general) was hugely depressing. Their fast and clean emergence from Chapter 11 and, for GM at least, improving forecasts is a win that bolsters many of us and keeps us rooting for the underdog.

I am thankful that Ford was able to avoid bankruptcy altogether. Sometimes luck leads the way, and Ford was plain lucky to have tackled its debt issues before the commercial credit doors swung shut. Coupled with some important vehicles that were hitting dealerships at the right time, Ford was able to emerge as a leader in the most difficult financial environment since the Second World War. Having a domestic manufacturer be part of what is right in our economy was a huge benefit when everything else was looking so bleak.

I am thankful that all of the economic meltdown is forcing so many companies to re-think how they do things. Massive challenges bring clarity of need, and creativity of approach. As a country of innovators, it is in times like these that our best shines through.

I am thankful to work for a company where disruptive change is sought out and embraced, where transparency and clarity are watchwords, and where “need-to-know-only” is largely absent. Companies like Jumpstart Auto Group attract the bold and the thoughtful, and invite them to apply their greatest energies to change what needs changing, and to better what others might think is fine. Through these people, our industry will remain exciting and strong.

Finally, because we should all be working to live, and not living to work, I am thankful for a wonderful family, fantastic friends, and stout good health. May your Thanksgiving be a celebration of life and loved ones as well.

Happy Thanksgiving, friends.

The ability to maintain this success will now appear to be Hyundai’s largest challenge. Staying the course can be difficult when confidence is high. Missteps most commonly occur for a rising car company due to overconfidence. Oftentimes success is blinding.

Upstart manufacturers have been plagued by overconfidence over the history of the industry. A prime example is the Volkswagen brand. It delivered on the promise of reliable, affordable, fun-to-drive vehicles for many years in America. But in 2002, corporate ego got the best of VW when it introduced the Phaeton, a high-end luxury sedan with a $70,000-$80,000 price tag attached to it. It failed miserably in the market and took resources away from the core products that were highly successful for VW. VW has since learned from its mistakes and recovered nicely, but it paid handsomely for the mishap that was Phaeton.

In a similar effort that could also be destined for futility, Hyundai will bring the Equus to market in 2011. (Meaning they’ll begin promotion in 2010). Equus is a high-end luxury sedan with a $50,000-plus price tag, representing a complete departure from the product suite that Hyundai possesses today. The Equus is meant to be in direct competition with Lexus LS, Mercedes S-Class and BMW 7-Series. This appears to be a huge leap of faith considering the average price of a Hyundai is below $30,000, and the average price of a Lexus, BMW or Mercedes is north of $60,000. It all sounds very Phaeton-esque. And while VW recovered from the Phaeton debacle, one can ill-afford billion-dollar mistakes in a 10-million unit auto economy.

Frequently when car companies, or any company, find a formula for success, they begin to believe that the formula is impenetrable. Instead of building on the momentum they’ve created, the Equus could ultimately become a distraction for Hyundai and take away from the positive developments of 2009. Can the Equus ultimately deliver on stealing market share away from dominant luxury brands and avoid the fateful path of Phaeton? We’ll find out in the next 12-24 months.

Hyundai is rolling while most others are at a standstill. Hyundai also has a very bright future ahead if they are able to stay the course — building quality vehicles and continuing to market successful programs that are consumer-friendly. The hope from this fan of smart automotive marketing is that overconfidence won’t blight the path ahead for Hyundai.

The question asked was in regards to Toyota’s stance on direct sales to consumers from the OEM. Mr. Lentz’ response was “We make cars… We don’t know how to sell them.” The dealer network is clearly a necessity in Mr. Lentz’ opinion, as he seemed to imply that Toyota relies heavily on their dealers’ relationships with (and understanding of) consumers.

Having worked for many years for an OEM, I am certainly aware that this may have been a simple way of avoiding the “stringent franchisee agreement laws” discussion. However, I think the bigger issue here is the typical OEM belief that the dealer (as the single point of customer contact) knows the consumer best. It is this point that I need to address.

Consumers have forever been hesitant to trust or rely on a dealer in regards to most sales and service issues. There seems to be a long standing sentiment that dealers are just out to make a sale, and are constantly looking for ways to swindle consumers out of their hard earned money. And while there are certainly good dealers out there providing consistently fair pricing and great service, the perception has become reality for most Americans. This lack of trust makes it hard to believe that the relationship is one in which any credible two-way conversation is occurring. So, how is it that any dealer “knows” the consumer best?

Working in the digital automotive space now, I have been exposed to a number of sources where in-market automotive shoppers are researching, and discussing the automotive purchase process. It is clear to me that to truly understand the consumer; you need to have credible conversations with them. These conversations are probably not happening at the dealership level, nor are they happening at the OEM level. Third-party automotive sites, Facebook updates, Twitter post, and auto blogs are the places where consumers are sharing their true feelings, and it is here that OEM’s and dealers can truly learn about their consumers and get a better understanding of how to sell cars. Even better, this technology allows for more than just eavesdropping, it allows for engagement.

During his speech, Mr. Lentz, in reference to the alternative fuel and emissions discussion, said that “The Future is in innovation and harmony.” I think that is a fantastic quote that can applied to the automotive business in general. Since consumers are already discussing all of the automotive product and sales issues in on-line forums, future successes will be driven by brands and dealerships that “innovate” ways into these discussions “harmoniously”.