Korean car maker Hyundai’s tie-up with Edelman for pan-European support
highlights the escalating PR battle in an overcrowded and stagnant
European motor industry
At a time when Korean, Japanese and American car manufacturers are vying
aggressively for market share with indigenous European firms, there are
signs that PR agencies are set to benefit.
Edelman looks poised to help Hyundai Motor Europe boost its corporate
reputation across the continent. And this drive, along with the
activities of fellow Korean manufacturer Daewoo, highlights some
critical issues in motor industry PR - both in terms of marketing
communications and wider corporate issues. Despite Korean ambitions, the
European car sector is not expected to grow by more than two or three
per cent this year.
‘To all intents and purposes the market is stagnant,’ says Times
motoring correspondent Kevin Eason. ‘The market peaked in 1989 but still
hasn’t recovered from the recession.’ Nevertheless, more models are
being launched than ever before.
Paul Taaffe, Hill and Knowlton’s president and chief executive for
Europe, the Middle East and Africa says: ‘Companies are becoming
increasingly aggressive in promoting their cars. New technology means
manufacturers can produce new models in low volumes for niche markets.
The conventional definition of the marketplace is changing.’
Apart from the flood of new products, PR potential is boosted by a wave
of new editorial opportunities outside the specialist media. How are
Hyundai’s next major launch will be that of its first ever sports coupe
this autumn. UK PR manager Steve Kitson admits it will be a small volume
vehicle. Nevertheless it will be supported by a six-venue summer
roadshow and 120 UK journalists will be given a ‘ride and drive’
opportunity - a clear indication that the car industry, traditionally
renowned for its high PR spend, is losing none of its extravagance.
Kitson confirms that PR will play the lead role in the coupe launch
because small volumes rule out big ad campaigns.
At the same time, PR is becoming more targeted.
‘The better PRs are becoming far more scientific in their approach’ says
Michael Harvey, editor of Autocar, ‘They are learning to target
different media with tailored stories and broadening their scope to
include new media titles such as new lifestyle magazines.’
Last year Hyundai used Cameron Choat for a project to identify and reach
audiences which tend to avoid the standard motoring press. Kitson says
this approach will continue with the coupe launch, using men’s lifestyle
titles to target new, carefully defined consumer groups.
But while Hyundai, an exporter to the UK for 13 years, continues to
strive for a one per cent market share, newcomer Daewoo has achieved
close to this in just over a year.
Daewoo’s determination to eschew dealers and sell its cars directly to
the public with a three year warranty has shaken up the sector. PR
manager Mark Carberry claims its 1995 launch into the marketplace was
the most successful ever in terms of registrations.
He says: ‘We grew awareness from four per cent in April 1995 to 92 per
cent by the end of the year. With only two types of car we’ve created a
strong brand in a short period of time. Creative marketing and PR has
been a major factor.’
Last November Daewoo brought in Jackie Cooper PR with a brief to target
‘all the media they could’ to get the company’s customer service message
across. This included targeting women, the ‘grey’ market and disabled
Senior partner Jackie Cooper says: ‘Daewoo, with its emphasis on
breaking the mould of car selling, is a PR dream. We’ve been able to
take the advertising campaign forward and promote the service side,
reiterating the marriage between manufacturer and customer.’
Marketing communications aside, both Hyundai and Daewoo have recognised
that they cannot afford to ignore the long-term effect of their
corporate reputations on sales. Japanese competitor Nissan has long
realised the benefits of positioning itself as a British manufacturer to
cash in on car buyers’ nationalistic loyalty.
For Koreans this can be a problem. Last year Hyundai ran its
controversial ‘prejudice’ commercial which tried to counter a perceived
anti-Asian sentiment. Although Daewoo’s Carberry believes Hyundai’s
approach was brave, he thinks it confuses the car-buying decision -
which can be effectively influenced through advertising - and wider
issues that are better tackled through PR.
He recognises that, as major conglomerates based on the booming Pacific
Rim, the two companies’ European ambitions could be seen as Korean
Daewoo is currently developing a five-year communications plan likely to
feature the integration of its European corporate affairs while leaving
marketing communications in the hands of country managers.
Unlike Daewoo, Hyundai already has a centralised European office in
Frankfurt and Edelman’s brief suggests Hyundai’s own communications
plans are well underway.
Hyundai’s Kitson says: ‘While the national franchise operators already
swap ideas, we’re looking to co-ordinate more on a pan-European level
particularly in the area of corporate affairs.’
Big plans, big budgets. The PR opportunity for agencies and highly paid
in-house staff is clear. Yet Korean importers represent a mere fraction
of the market. Japanese ‘transplants’ Nissan and Toyota have equally
ambitious communications strategies.
And the traditional giants such as Ford, Vauxhall and BMW are unlikely
to take it lying down.