Dramatic changes in the auto industry are fueling efforts by suppliers to build consumer brand identity. Automakers are no longer specifying every part in every car down to the smallest bolt. Today, their credo is to simplify. That means outsourcing more parts work. At the same time as they're simplifying production, however, automakers are trying to do more niche marketing of their cars and trucks to various consumer groups.
How do they do it? By using parts with consumer brand identity, such as DVD players, car interiors, brakes and other equipment.
Building parts' brand identity is 'the linchpin between two contradictory trends in the industry. It's mass production, but niche marketing,' says Michael Schmall, managing partner with Farmington Hills, MI-based The Planning Edge, which recently conducted a study of consumer attitudes toward parts branding. What Schmall's study found is that consumers' auto-buying decisions can be influenced by branded auto parts.
'The value is in the consumer deriving value from a given brand being wedded to a specific model,' explains Jim Nader, market assessment manager with CSM Worldwide, which conducted the study with The Planning Edge.
Consumers aren't yet going into dealer showrooms demanding a specific stereo or specific brakes. But they are saying their buying decisions can be influenced by the presence of certain branded parts.
'Branded audio is one area where it definitely works,' notes Frederick Zosel, president of Detroit-based PR Associates.
Variety of approaches
Other parts makers are hoping it will work for them as well. They're using a variety of PR approaches to build their brand identity:
- Targeting the traditional auto press. Getting car enthusiasts excited about specific brands is seen as a necessary first step for reaching the broader consumer audience.
- Using special event PR, such as unveiling new products at auto shows.
- Co-branding their products with recognized consumer brands. Johnson Controls, for example, has unveiled an in-car child activity center that also carries the Lego name. Lego is also doing PR for the product. It is reported that Visteon Automotive Systems, a major parts maker that will be spun off by Ford, plans to co-brand with Nintendo.
- Targeting the parts after market. Companies such as Bosch have built their brand reputations in the replacement parts arena and now are using PR to extend their reach into the primary automaker market.
'Those who want a brand are ultimately going to have to become consumer products companies,' notes Michael Hedge, president of Southfield, MI-based Hedge & Co. 'It's going to be quite a few years for most companies before their brands are recognized in any way by consumers.'
Suppliers not accustomed to the cost of building consumer brands will turn to PR because of its cost effectiveness relative to consumer advertising.
PR 'needs to provide the strategy of what they're doing,' says Tom Eisbrenner, VP at Troy, MI-based Eisbrenner PR. 'The biggest challenge suppliers really have is defining what their brand is. That's really where PR needs to step in.'
At Johnson Controls, PR is used to target branding messages to various publics, says Dave Roznowski, PR manager in the auto systems group. 'You need to create that consumer awareness.'
For its new PlaySeat, Johnson Controls decided to launch the product with PR, doing no advertising. A rollout of the Lego co-branded product at the annual Detroit auto show in January garnered major coverage from the likes of CNN, MSNBC, and the auto trade press. Lego then followed up with its own rollout at the New York toy show, doubling the exposure for the product.
'What (Johnson Controls) did with Lego is quite ingenious,' says Dave Versical, managing editor of Automotive News, a major industry trade publication.
Johnson has been targeting new products at consumers for some time. Back in 1985, when it unveiled its HomeLink, a transceiver that can open garage doors or gate locks and turn on lights, it 'took work to get automakers to use the name' in their vehicles, says Roznowski. Johnson got garage door opener makers to put the HomeLink name on their products, saying they were HomeLink compatible, to build consumer awareness of the product and used that to break down automaker resistance to using the brand name. This year, HomeLink will be available on 97 different car models.
Automakers traditionally haven't wanted to put a lot of other brand names on their cars. That attitude is likely to change if parts makers can convince the auto giants that including a part's brand name will mean more consumer appeal and thus more sales.
But automakers are far from being of one mind on the issue. 'I'm sure that there are some very interesting battles going on' over whether carmakers should include parts' brand names on their products, says Auto News' Versical.
Suppliers in the mix
Eisbrenner expects supplier information to appear in literature about new models rather than on the cars and trucks themselves. He notes that more and more supplier information is being included in press kits for new models and says automakers are encouraging that. 'The supplier name is going to appear in the marketing mix,' he says.
Eisbrenner's firm has done extensive work with Bosch, helping it build its brand image in the aftermarket with involvement at racing events, auto shows and through exposure on the Web, for example. Bosch, which makes such things as brakes, is an example of a supplier building a brand identity for parts that consumers don't necessarily see when they're car shopping. Items that relate to safety, such as brakes and air bags, are unseen but high profile in consumer minds, and thus are ripe for branding.
Will PR succeed in building auto-parts brand awareness? Hedge thinks it could be three to seven years before the results are in. But one thing seems certain?with automakers changing how they do business, parts makers are going to have to do the same. To stand out, they need higher profiles than they had in the past. Creating consumer demand for their products is the way to build those profiles. Advertising alone won't get the job done; it's too massive and sustained an undertaking. PR will have to play a major, if not the lead, role.