This Car Company Has Your Back

January 30, 2009 | blog | By Mike Sullivan

Amidst all the hand-wringing in the battered auto industry, there has emerged one shining example of a challenger brand that is turning defeat on its ear. You have no doubt heard about Hyundai’s ground-breaking “Hyundai Assurance” program, which lets buyers return their vehicles and walk away from their loan obligations should they lose their source of income in the first year of ownership. The company is promoting the program with a multimillion-dollar national ad campaign, and I’ll bet the publicity generated by the move matches the ad spend to date. It seems everybody has been talking about this “deal” for the past several weeks.

This is a brilliant example of challenger brand thinking, because it answers the central challenger brand marketer’s question: “How can we rewrite the rules of the game so we can win in the marketplace?”

Hyundai’s answer to that question is a winner, because it completely changes the relationship with customers in a way that is meaningful to them. The company says, “We’ve got your back,” in its campaign, and it surely does. When was the last time a car manufacturer could make a claim like that in an authentic way?

Apparently, the offer resonates with prospective car buyers. Since launching the program January 3, Hyundai has reported increased Web site traffic of 50 percent and a jump in purchase consideration of 15 percent. The idea has effectively allowed a brand with just 3.1 percent market share in the United States to assume thought leadership for the entire automotive category. Who else is offering prospective buyers anything innovative or compelling at all? Nobody.

The Hyundai Assurance concept further illustrates the idea-centric streak that is becoming something of a hallmark for the manufacturer. In 1998 when the company was struggling with weak sales performance based on poor quality perceptions, Hyundai changed the category landscape by introducing the first-ever 10-year/100,000-mile vehicle warranty, which it still calls “America’s Best Warranty.” It was a resounding success and helped spark the car maker’s dramatic turnaround.

Hyundai leadership is looking at the current economic malaise as an opportunity rather than a problem and fully expects to gain U.S. market share in 2009.

“We feel pretty good despite the difficult economy that we’re well positioned to continue to grow in North America,” David Zuchowski, vice president in charge of Hyundai’s U.S. sales, told Industry Week.

And why haven’t other manufacturers responded to the times the way Hyundai has? Some of them may be more focused on externally generated solutions, but one thing is certain: They simply aren’t thinking like challenger brands.

Difficult circumstances always present opportunities for clever thinkers to outsmart the competition by shaking up the status quo with stunning ideas. That’s what Hyundai has done, and we predict they’ll be a winner when the curtain closes on 2009


Mike Sullivan

President at LOOMIS, the country’s leading challenger brand advertising agency


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