Much, and I mean much, has been written about the General Motors crisis. Some claim it’s hopeless. Others say there’s a chance that things will work out in time. No one writes about the fact that success or failure will not revolve around the GM brand. (No one walks into a car dealership and asks for a GM car.) Their future depends on how well their remaining brands are positioned and how well each strategy is executed. In some ways it is a replay of Alfred Sloan’s eliminating a number of GM brands, and building a gigantic business around five brands that became a “car for every purse and purpose”. But that was then. What’s available in today’s highly saturated and wildly competitive automobile market?
First, what drives today’s most successful brands? In a word, it’s a word. The most powerful brands stand for a word or a concept. Toyota is about reliability. BMW is about drivability. Mercedes is about engineering. Volvo built a brand around safety. The problem with the GM brands was each lacked that simple differentiating idea. This was the result of each brand trying to be everything for everybody. What’s a Chevrolet? It’s big, small, expensive, cheap, truck, van or sports car.
So the task for the post bankrupt GM is to carefully figure out what their four remaining brands should be about. What is the differentiating strategy to pursue?
Interestingly, there are some obvious ideas on the table that they can move to preempt.
Let’s start at the bottom, Chevrolet. If you look at the numbers, Chevrolet has a chance to establish a leadership position. This is always a good strategy as people buy what other people buy. What’s a Chevrolet? It’s “America’s favorite American car”. Good value, variety and heritage can be the story.
Next up is Buick. Their first move is to stop making cheap Buicks. Don’t compete with Chevrolet. What you want to do is to compete with the cheap BMW’s, Mercedes and other luxury automobiles that are trying to go down in price to sell more vehicles. This sets up the concept that a Buick is about “quality without paying for status”. That could be a very powerful value story in a world that is buying less status.
Continuing up the ladder, we have Cadillac. This can never be a prestige car. The fancy imports dominate that category. What Cadillac can stand for is “Leading edge technology” in such things as engine performance, safety or electronics. Some people love to buy the latest thing.
Finally there is GMC. I’m not sure why they want to hang on to this brand but there is an idea they could use especially with the larger vehicles that use this nameplate. The concept is that of “Rugged reliability”. It comes out of their prior “professional grade” promotion of this brand only is a lot more meaningful. Of course they would have to deliver on that promise.
There you have it. Four brands well positioned in a tough marketplace. One could say that if they execute properly and stay focused on these concepts, they have a shot at success. If not? Well, let’s not drive there.
Stay tuned to Branding Strategy Insider. Tomorrow we have a special offer for GM management.
Update: Our offer for GM
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