GFerg

Rebuilding Excitement
Despite new products, marketing efforts, Pontiac still struggling to regain sizzle
By DALE BUSS | AUTOMOTIVE NEWS
AutoWeek | Published 05/15/06, 8:12 am et





"Revive Pontiac" has been on General Motors' to-do list for decades. Even as other GM brands became nondescript and the company's market share tumbled, GM executives insisted they could build excitement around Pontiac again, as they did in the muscle-car era of the 1960s.

Pontiac is enjoying a rebirth of its products, its marketing, its brand image and its showroom sizzle. For now, though, those gains have yet to show up in sales figures.

The brand has created buzz-building tie-ins with properties ranging from Google to Oprah Winfrey's TV show. Surveys indicate that Pontiac is appearing on more young consumers' shopping lists.

"It hasn't been the coolest thing to have a Pontiac in your driveway for a while," says Pontiac Marketing Director Mark-Hans Richer. "Our job is to re-establish that feeling."

Richer, 39, is a Milwaukee native who attended his high school prom in a 1957 Ford Thunderbird. He grew up appreciating the Midwestern roots of Pontiac's success. Yet he insists that rebuilding the brand requires more than appeals to nostalgia.

"It would have been far easier for us just to be retro and do what the '60s Pontiac was," Richer says. "But people forget that back then, Pontiac was a very progressive brand. So we're trying to move it into a new space and still be true to what we've been."
'Social acceptance'

Pontiac's strategy is based on "creating social acceptance" for the brand, Richer says. That starts with offering exciting vehicles such as the Solstice roadster, which is available in limited quantities but creates a halo. Pontiac also is banking heavily on the sporty G6 sedan, which just became available in a convertible, and the Torrent crossover.

Besides new vehicles, Richer is pursuing what he calls "product fusion": aligning Pontiac with other popular brands.

Winfrey's giveaway of 276 G6s to her studio audience in 2004 was the first gambit. Pontiac vehicles have been written into plot lines of the reality TV shows "Survivor" and "The Apprentice."

Its TV commercials have invited viewers to "Google Pontiac," boosting online searches for the brand. This year, as in 2005, Pontiac is co-sponsoring a concert tour with the Virgin record label. The British label selects the music for Pontiac spots.And while Pontiac makes effective use of traditional media, the brand's Web site is gaining kudos. J.D. Power and Associates ranks Pontiac.com among the three most useful new-vehicle shopping sites, largely because it is easy to navigate.

Because of the brand's revival, built on new products and new marketing, Pontiac's showroom traffic is up about 20 percent compared with a year ago, according to CNW Marketing Research Inc. of Bandon, Ore.

"That's actually an incredible increase," says CNW President Art Spinella. "While they have some new products, for the most part they're a mainstream brand."

Younger customers

About 40 percent more women are entering Pontiac showrooms this year, CNW says. The average age of Pontiac shoppers has dropped to 41 this year from 54 last year, Spinella says.

But Pontiac's U.S. sales continue to slip. Through the first four months of 2006, sales were down 7.5 percent over the year-ago period. The 437,806 vehicles Pontiac sold last year were down from 474,179 in 2004.

Some guardians of the brand remain skeptical.

"GM doesn't have enough time, money or smarts to reinvent Pontiac," says Jim Wangers, a retired GM executive who helped create Pontiac's muscle-car era. "They've got to recapture what the brand was."

Other critics say GM has undercut all its brands over the past few years by emphasizing price discounts to move vehicles. GM Chairman Rick Wagoner vows to break the company's addiction to incentives.

Richer says he welcomes the challenge. Soon after he joined GM about nine years ago, he developed the "Professional Grade" brand positioning that helped turn GMC around.

"Cars are an incredible category with incredible opportunity," Richer says. "And I really believe Pontiac is one of the best opportunities out there."

mmarshall

Well....that right there is part of the problem. Toyota made the same mistake with the MR2, BMW did with the first Z3's, and Saturn is, unfortunately, doing the same thing with the Sky, even though the Sky generally sells at list. None of these cars....and neither were the first Porsche Boxsters as well......were or are being built in the quantities they should be to meet demand.

You've GOT to build the cars people WANT, and then MAKE THEM AVAILABLE, not just put an arbitrary figure on them and say " well, we're going to build just 5000 of them, allocate one or two a month to selected dealerships, and let the market scramble for them. No.... .....THAT is not the way to gain....and keep...new customers.

People want Solstices, so...... BUILD them. Provide the supply to meet the demand. That will not only save auto industry jobs but add to them as well. And then SELL these cars at reasonable prices without outrageous $4000 and $5000 markups

I now know where auto marketers belong on the evolutionary scale. If WE evolved from monkeys, then MONKEYS evolved from auto marketers. That is about the intelligence level of some of them.

I know, guys...I'm venting, but this subject, like the one about auto firms covering up prototype cars with taps and bras necessitating " spy shots " is one that really gets my goat.

ff_

GM needs to find a happy medium. Their normal practice is to flood dealers with countless examples of any one model. "You want a red Tahoe? Excellent, because we have 42 red Tahoes on the lot." This kills resale, and also reduces customer urgency to buy, as well as makes them think twice about selecting something that's so common. If they can build products that people actually want to buy, and offer just enough of them and in a variety of colors and package levels, I think that's the key.

I believe that GM is finally realizing that designing vehicles primarily for the rental fleet market, rather than the consumer market, was a big mistake.

CHIS350

Exactly


Chrysler is offering HEMIs to anybody that wants one, and look how many you see on the road!

mmarshall

OK...42 of one type of vehicles may not necessarily be good for resale, but what good is resale value to an auto manufacturer? GM itself profits nothing if someone pays top dollar for a USED vehicle....that money goes either to the dealership's used-car department or to a private individual, or, in some cases, a rental-car-firm. In fact , high residual values in some cases can actually hurt a dealership, because lease rates are based on the projected 2-4 year depreciation of the vehicle. The more a used vehicle is worth, the less the lease rates will be.

Now..as far as a customer selecting something that is " common " ....what difference does it make if the vehicle is " common " or not if he / she wants it and it is the best vehicle for them? Hey......all the MORE reason to have them in stock on dealers' lots whan it comes shopping time. The less hassle a potential customer has to go through, the more likely they will STAY a customer.
And consider this: 42 vehicles of one type is not necessarily a whole lot. In the Washington, DC area where I live ( the second-largest new-car market in the country ) a large Honda or Toyota dealer will move that many ( or more ) Accords and Camrys IN ONE DAY, especially on a big holiday sales weekend. Camrys and Accords ( trust me ) sell in unbelievable numbers. Why?....simple. They are both excellent products, people want them, and dealers have them IN STOCK. You can't sell what you don't have.

ff_

One of the things that has always helped Honda sales (and Lexus, and..) is producing vehicles that consistently hold their value well. It's a lot easier to sell cars that do. What intelligent buyer doesn't take that into account when choosing a vehicle?

Conversely, how often do you see a Ford or GM commercial that doesn't use rebates, low interest rates, and deep discounts to sell? That's all they have.