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Is brand equity really the driver behind the relative success of one of two identical cars sold in the US market-place, or are there deeper issues relating to marketing strategy and the antecedents of branding? The author examines the fate of the Toyota Corolla and Chevrolet Prizm and compares it to Senator Button's plan of Australia in the late 1990s, during which the Australian big five were forced to rely on badge engineering to distinguish their products. He concludes that some automobile brands have matured into extendable attitudes conducive to their survival while others remain fixed in narrow, product-reliant niches. A recent McKinsey Quarterly discussed the fate of two identical cars in the United States market-place: the Toyota Corolla and the Chevrolet Prizm.[1] The two vehicles are comparably priced, receive high marks from Consumer Reports, are built at the same plant in California, 'Yet the Prizm requires up to $750 more in buyer incentives to support its sales. Even so, only one-quarter as many Prizms are sold, and their trade-in value depreciates much more quickly.'[2] The authors then say that relationship and emotional benefits are more the driver and that automakers should move toward brand-based strategies to help sales. They go on to say that strong brands do not have to attract as many prospects and convert them to sales. Solutions included various brand exposition activities such as festivals to build loyalty and brand equity and targeting high-potential segments. Common identities, or rather, easily identifi-able ranges, capture more consumers, they believe. However, this ignores that Toyota itself, because of the way Japanese companies design cars (it is individual product line-based in the home market, not range-based), does not offer as coherent a range as Mercedes-Benz, the most successful converter of prospects to sales. So how can successful Toyota-which at the time of the study offered very disparate-looking Echo, Corolla, Camry and Avalon sedans-be reconciled with successful Mercedes-Benz? The Corolla and Prizm are good places to start in examining brands, but the author feels that while the conclusion is correct and that the study's recommendations are acceptable, there are far deeper issues at play. Additionally, the driver for these benefits outlined by the McKinsey Quarterly must come far earlier than at the exposition stages and need to be incorporated into a brand-based product-development strategy. In short, without determining the brand attitude, no festival-or any brand exposition event-can compensate. Identity first, branding second.[3]
Footnotes: [1]. Chatterjee, Jauchius, Kaas and Satpathy: 'Revving up auto branding', McKinsey Quarterly, no. 1, 2002 [2]. Ibid. [3]. With the terms as defined by Olins: The New Guide to Identity. Aldershot: Gower 1995 and cited in Yan: 'Online branding: an antipodean experience', in Kim, Ling, Lee and Park (eds.): Human Society and the Internet. Berlin: Springer 2001, pp. 185-202.
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