MARKET FOCUS AUTOMOTIVE: Driving luxury sales - John N. Frank findsthat automakers are shifting to mainstream PR efforts to sell high-endmodels

When US auto sales for May were announced, the industry let out a collective groan: Sales fell 5%.

When US auto sales for May were announced, the industry let out a collective groan: Sales fell 5%.

But one segment of the market wasn't sighing. Luxury car sales were higher in May than they had been throughout the year, with brands such as BMW, Infiniti, and Acura reporting all-time record sales months.

Luxury sales came to a standstill after September 11. But since then, consumers are deciding that now is the time for luxury.

"We were really concerned after September 11, says Nancy Hubbel, national PR manager for Lexus. "But we saw a carpe diem attitude emerge, and I think the luxury market has benefited from that."

Consumer buying decisions have been helped by luxury brands offering more lower-priced models. Luxury carmakers have extended their brands into the $25,000-$30,000 price range, opening up the market to new buyers.

They've also moved into the SUV and light-truck categories, further broadening the definition of what constitutes a luxury vehicle.

Those moves have presented the PR challenge of maintaining brand identity and integrity for lower-priced luxury cars, SUVs, and light trucks. And as new consumer demographics are targeted, PR for luxury cars has taken on the jobs of differentiating one luxury brand from another, and of stepping up efforts to stand out in an increasingly cluttered market.

"It wouldn't make any sense for us to say we want to look just like Mercedes-Benz or BMW, says Steven Keyes, director of corporate communications with Audi of America.

To differentiate themselves, luxury carmakers are reaching out to the auto press and to lifestyle publications. They're also looking at opportunities such as movie tie-ins, special events, and cultural gatherings to expose their products to consumers and maintain those ever-important brand images.

Going the mainstream route

"You see luxury manufacturers starting to look more like mainstream producers in terms of how heavily they promote their products and how they promote their brands, says Paul Eisenstein, a longtime Detroit auto writer who runs TheCarConnection.com.

Mike Spencer, national PR manager with Acura, follows what he calls the "Chinese water torture approach to PR, putting out a constant stream of news releases on such topics as awards Acura wins. "We're making sure we're sending things to (auto writers) every chance we get, he says.

"If you're not top of mind, somebody else will be."

Acura wants to be known as a performance luxury brand, so Spencer focuses on performance issues in his releases. He also tries to make it as easy as possible for the media to get information about Acura, which is why he launched a simplified media website, Acuranews.com, last year.

This July, as Acura begins focusing on three new sports versions of existing models, Spencer plans to bring the new cars to racetracks to let journalists test them. He's also set up regional test drives to make it easier for local auto writers to see his products - a technique that's common among mass-market carmakers as well.

Bunny Richardson, assistant manager of media relations with BMW Manufacturing at the luxury carmaker's South Carolina plant, agrees. "You don't just tell your story when times are good, or when times are bad, she says.

"You do this consistently. You build those relationships with customers, with the media, and with consumers every single day."

BMW wants to be known for safety and performance. "We are a performance car, and part of that is safety, says Richardson. Brett Turner, an account exec with BMW Manufacturing's agency Jackson-Dawson Marketing Communications, notes that he stresses BMW achievements, like the safety performance of BMW's X5 in the annual Insurance Institute of America tests. "People want safety, and they want luxury. And if they come together, price doesn't really matter, says Turner.

Price does matter in the entry-level end of the luxury market, however.

Jaguar and Land Rover, two brands that are part of Ford's Premier Auto Group, have expanded into the entry-level luxury category in recent years, and adjusted their PR efforts accordingly, says Simon Sproule, VP of communications and marketing services for Aston Martin, Jaguar, and Land Rover. Jaguar brought its X-Type to America last year, priced in the $25,000-$40,000 range, a new price point for that nameplate. Land Rover has the $25,000 Freelander.

For the Land Rover Freelander, introduced last fall, Sproule turned to the auto press. "We needed to prove to the auto press that this was a genuine Land Rover, he explains. "The entry-level consumer in the luxury market is probably the toughest consumer in the market. The challenge for all premium brands as you expand them is expectations."

For the X-Type, "we had to broaden our consumer base. We needed to wake consumers up that we were in that segment, Sproule says. His first target, again, was the automotive media. Luxury buyers want hot products, and they look to the auto press to find out what's hot and what's worth buying.

"You have to make sure the auto press understands, Sproule says.

He held a driving event for auto writers last summer to show off the new X-Type. But because he was trying to expand Jaguar's traditional consumer base, he also pitched lifestyle and fashion publications. A charity fashion event was held in Hollywood last year, along with fashion events in New York and Miami. Now, nine out of 10 X-Type buyers are new to Jaguar, and Jaguar sales were up 33% in May compared with the same month last year.

Racing to be seen

An offshoot of going after lifestyle publications is placement of luxury brands in movies and at key locations where the luxury buyer goes. Jaguars, Land Rovers, and Aston Martins (the third brand in the Premier group), will all be seen in the next James Bond movie, Sproule notes. Jaguars will also be in the new Austin Powers movie opening next month.

Lexus fell into a PR bonanza when Steven Spielberg asked the company to design and build a futuristic car for the movie Minority Report, starring Tom Cruise. Lexus is showing the car, which is supposed to be a 2054 model, at auto shows and press screenings of the movie throughout June.

Cadillac, which has been trying to revamp its image to attract a new generation of buyers, will be in the new Matrix sequel coming out next year, says Jeffery Kuhlman, director of communications with Cadillac.

But movies aren't the only place luxury carmakers want their products seen. Joe Molina, founder of JMPR Public Relations in Woodland, CA, has done PR for brands such as Lamborghini, Bentley, and Shelby for years, and recalls letting celebrity chef Wolfgang Puck drive a Bentley just for the prestige he added to the brand. Leaving upscale cars parked outside Puck's Spago is also part of creating that special image, he says. "You don't publicize a Lamborghini like a Kia, Molina insists. "It's not about transportation. You don't need these cars, you want them."

Audi has aligned itself with the performing arts, sponsoring the San Diego and Los Angeles operas, where it regularly has cars on display.

It also sponsors the Dallas and Atlanta symphonies, as well as an opera night at Carnegie Hall. Such events are in keeping with an image of "progressive luxury that Audi is trying to promote, Keyes says. So are such upscale sporting events as sculling, polo, tennis, and fundraisers in Aspen - all of which Audi is involved with.

Cadillac is in the midst of a six-city tour for its CTS EXT, bringing cars to LA, New York, Chicago, Dallas, Miami, and Atlanta, and placing them at events and hot restaurants, says Kuhlman. The Miami event was held at a newly redesigned showroom where future models were on display to emphasize Cadillac's push to to appeal to a new audience, as Cadillac has been plagued with the image of the "old luxury car - once popular, but now outdated. To get away from that, it's been pushing new designs, and plans to introduce five new models by May 2003.

"The thing that's going to be the most unique about Cadillac is style and design, says Kuhlman. While other luxury makers bring out lower-priced models, Cadillac is talking about more expensive cars, such as a model selling for $75,000-$80,000, to stress its newfound cachet. "We want to broaden the appeal of Cadillac across generations, Kuhlman says.

Cadillac also counts on letting reporters test new cars. "We're trying to give people the opportunity to experience the brand rather than shouting about it."

Agrees JMPR's Molina, "It's not about hype. This is too sophisticated a market. The best thing is to let writers touch and feel the cars."

In the current economy, that's meant becoming aware of the realities of news organizations that have been hit by ad slumps, and don't have the travel budgets they once did. Cadillac held East Coast and West Coast media events for its CTS this year, for example, to cut down on travel time and expense for reporters. Cadillac is also making its top executives available to reporters more than in the past. Other automakers are also taking reporter budget issues into account, scheduling more regional events, and combining test drives for different models.

But while budgets are an issue for reporters, they're not for luxury car buyers. And as long as that's true, PR will continue to push upscale cars to a waiting market.

Luxury cars outpace the rest

While the US auto market had been holding up better than expected early this year, sales slowed in May. The Big Three producers saw an average 6% drop. Among the big boys, only DaimlerChrysler saw sales increase, recording a 4% jump for the second consecutive month.

But while the mainstream auto market softened, sales of luxury cars continued to rise. The divergence doesn't surprise auto experts.

Several luxury makers such as Land Rover have new models they introduced last year, and others are bringing new products to their showrooms this year. While the tech wreck might have hurt the buying power of some technology once-millionaires, old money can still shop for luxury today, and new products spur such shopping.

"The luxury market is very sensitive to new product. It's what's hot that sells, says Simon Sproule, VP of communications and marketing services for Aston Martin, Jaguar, and Land Rover. Jeffrey Kuhlman, director of communications with Cadillac, agrees. "Luxury cars don't always follow the economic times. There's a lot of excitement in the category now because there's a lot of new product out there."

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