Right near my office at Phileo Damansara in Petaling Jaya, a luxury German auto manufacturer has two billboards advertising its top of the range luxury autos. One is a saloon and the other is an SUV. I like this particular SUV so much that if I was still putting posters up on my bedroom wall, the SUV would be front and centre.
This company also has a number of billboards at other locations around the city of Kuala Lumpur and in the suburbs featuring a smaller version of the SUV (for which there is a 1 year waiting list) and other versions of the saloon. It also spends a lot of money on print ads and recently advertised their top end coupe in a Malaysian daily and a Malaysian business weekly.
Cars in Malaysia are expensive as import duties can go as high as 300% for luxury vehicles. The full page full colour ad with standard automotive blurb also stated the price of over RM1,000,000 (US$333,000). At that price, there are probably no more than a handful of people in the country who can afford the car. Even if there are a 100 or even a 1,000 people in the country who can afford the car, full page ads in national newspapers are probably not the most cost effective channels to communicate with those people.
Now I’ve actually approached this particular organisation in the past to ask if we can come in a make a capabilities presentation. We didn’t get past the marketing manager who basically said that as sales were very good there was no point meeting us.
Judging by recent reports, the company is certainly doing well after the launch of new models in 2008. In fact, the company claims to have been Malaysia’s fastest growing luxury car brand in that year with sales up an impressive 102%. Moreover, sales continued to climb in the first 6 months of 2010 with sales up 66% over the same period in 2009. Impressive figures and the company now claims to have about 5% of the luxury market in Malaysia.
Anyway, seeing this billboard on a daily basis with the telephone number prominently displayed, was beginning to get on my nerves. So I decided to call the number. After all, if you advertise your products on a billboard and display your telephone number, one can only assume that you want prospects like me to call you.
And if a prospect calls that number you better have the processes and systems in place to ensure that the person receiving the call passes it on to the right department. And you better have the right processes and systems in place to ensure that the next person in the process does what they are supposed to do. In this particular case, call the prospect back. Especially when we’re talking about a luxury product.
So anyway, I called the number and asked for information about the top of the range SUV. The receptionist was very pleasant and explained that she would get someone from the sales department to call me back. I gave her my mobile number and waited for the call. That was last Thursday, today is Sunday and I still haven’t heard anything. Bear in mind this vehicle costs over RM500,000 (US$166,000).
Generally the point of billboards is to create awareness. A telephone number is there in the hope that the keen, desperate consumer who wants the product so much that he will take the time to record the number and follow through with a call. Of course most of us just ignore billboards and the messages on them. Indeed, it’s rare for a prospect to call. But there are always incoming calls that may just result in an easy sale to one person who may become a customer for life so if you don’t have those basic processes and systems in place to take the information and pass it on, what is the point of advertising?
Here are some more tips that will help this company improve its profitability, the most important metric for branding:
1) The era of the global ad buy is over. Different markets require different communications strategies. Whilst it may make sense to create awareness of a luxury product via national papers in relatively wealthy western markets, it is a waste of money in developing markets where the demand for luxury products is limited to only a few.
2) Brand building is about the long term. When you launch new products they will, if you are extremely lucky, fly off the shelves or out of the showroom. But this is the exception, not the rule. And anyway, this doesn’t mean that you can become complacent, sit back, put your feet up and relax. Your competition will soon catch up and your moment in the limelight will soon be over.
3) The whole point of mass market advertising such as billboards and newspaper ads is to create awareness with mass markets. That is why weekend copies of daily newspapers are full of ads for hypermarkets, supermarkets, discount stores, sales and so on. But luxury products require more than a mass market tactic to make a sale. If you must use these old fashioned tools, use them to develop a database of prospects so that you can qualify those prospects and invite them to your showroom if you think they have potential.
4) Many companies will have a system in place to act on incoming enquiries. But who is responsible for ensuring those enquiries are acted on? The system must also ensure incoming enquiries are reported to sales management so that they can follow up with the sales department.
5) Brands are built on offerings of economic, experiential and emotional value. That journey begins with the first contact. It doesn’t matter how much you spend on advertising, if you can’t deliver that value, prospects will go elsewhere.
Now I’m going to call BMW to get more information on the X5.
7 thoughts on “Build a brand with the basics”
Unfortunately , customer experience and “ownership” of the customer is something that is relatively untouched in Asia. Marketing is “ads and promotions” and has not moved much beyond that. Sad as the world moves towards deeper into the engagement and experience models – here it’s still basic. There is a massive opportunity for marketers to develop and have a larger impact on the organization as a whole. We continue to work within our organizations and with Clients.
Thanks for your comment and you’ve nailed it. And the irony is that most countries in Asia retain a very social element to their cultures and this should actually give Asian brands an advantage in a flat world where ongoing relationships with consumers on their terms are key to profitable brand building. Western and Asian companies that have invested in the experience and developed relationships with their consumers – Cathay Pacific, Singapore Airlines, Mandarin Oriental, Ascott, CIMB, HSBC, Honda, Mini, Jollibee, Bumrungrad Hospital and more are testament to this.
“the irony is that most countries in Asia retain a very social element to their cultures and this should actually give Asian brands an advantage in a flat world where ongoing relationships with consumers on their terms are key to profitable brand building.” can’t agree more on this.
On a side note, may I ask how you, or the client can differentiate who is advertising agency and who is not? As many new advertising/interactive agencies started claiming themselves with different titles like creative agency, or even brand agency.
Hi Chuan Choong
Unfortunately most organisations appoint an advertising agency based on the creative capabilities of the agency. Actually the perceived capabilities because many agencies sell based on previous efforts and recruit only if they win the account.
The first thing the client should do is understand that brand building is more than a creative exercise. They then need to sit down with the prospective agency/consultant and determine their ability to understand the issues faced by the organisation and their ability to offer more than creative capabilities. For instance the experience. Do they understand the importance of the experience and what do they propose/offer to identify if anything is wrong with the expereince and if there is something wrong, how would they improve the experience?
What about internal branding? What do they propose the organisation do to get personnel on brand? If they recommend an internal newsletter, throw them out.
Another area is retention. Brands aren’t built on the first sale, they are built on the 2nd, 3rd, 4th and so on sale. But most advertising is based on acquisition, not retention. What does the agency recommend in this area (if they suggest sending a birthday card every year throw them out!) and how would they implement the recommendation?
We’re talking about a company’s brand here. It is crazy that firms leave it to marketing managers who are hot wired to look to advertising agencies to determine the brand strategy for the company.
I think some brands have decided on a specific area to concentrate on for the experience – Singapore Airlines = in-air experience but does not stretch that experience beyond that (ref your article which I recently came across on SIA Suites). Banks have not really started to segment their customer base beyond – Private, Wealth and “Mass”. And even then these are very broad level segments. Having worked with brands in Asia and US – I would stay we are at min. a decade behind. Brands are defined from the “manufacturer” standpoint and much less so from the subsidiary / local market level – we “borrow loyalty” if you will.
I think you are right. And a lot of those firms don’t integrate their efforts and a lot of those responsible for segments such as private don’t share data with those from wealth or retail. And most definately, brands are defined by the manufacturer when they are really defined by the consumer.