Tagged 'assurance'

Hyundai stands firm with the little guy in timely transition messaging

As we’ve noted, a couple of recent commercials are tapping into today’s populist sentiment. Hyundai does a good job of this in a recent spot for the popular Assurance Program, hammering home its commitment to the little guy. While “the dust has started to settle, and some indicators are up—especially for the big guys,” Hyundai understands that many people are still anxious. So it’s sticking with its Assurance Program, reassuring viewers that “The economy hasn’t really turned around for any of us until it turns around for all of us.”

An Ad Age article, “Now’s the Time to Reset Marketing for Post-Recession,” cites this spot as an example of messaging that “bridge[s] from recession to recovery.” But a real recovery isn’t likely to happen soon—as we noted in our 10 trends for the year ahead, consumer spending in 2010 will look very much as it did last year, with people continuing to exercise restraint until they see more clear and dependable signs of stability. By addressing the current sense of instability—and the resulting anxiety—head on, Hyundai offers yet another example of smart marketing in a downturn.

Toyota recall likely to boost consumer anxiety about brands

toyota-logoThe global recall of Toyota vehicles over a gas pedal problem is a case that will be interesting to watch over the coming weeks. How will consumers respond to a deeply trusted brand with a long history of success like Toyota suddenly failing on the public stage? Whether we like it or not, the rhythm of our lives is deeply linked to the brands we patronize. And if a brand as trusted as Toyota can fail its customers, who knows what’s next? It’s enough to make people anxious about brands. Especially given that faith in corporate institutions is already weak, with huge, seemingly solid financial brands having collapsed (e.g., Lehman Brothers) or come close (e.g., Merrill Lynch).

Some Americans have already taken action on their own through www.toyotarecall.org, an unofficial portal for all things on the recall. Toyota, your move.

Photo Credit: diongillard

In the Philippines, banks target shoppers still searching for stability

In a recession year, what a surprise it was last month to see a modest Filipino family hauling a big box containing their new widescreen TV. Before they rushed off to do more shopping, in answer to my query they said the purchase was “thanks to the credit cards—their offers are better this month!” bdo-credit-card

Off I went to the appliance store to investigate. What I found is that banks were offering extended payment like never before. Credit cards from Citibank and BDO (Banco de Oro) touted “Buy now, pay in 2010” and “Pay much later” schemes. Surely a big help to the Filipino family with a primary breadwinner still working abroad and perhaps a little late coming home for Christmas. Or families still feeling unstable because a member lost a well-paying job in 2009.
And banks know that in December, along with splurging on food for their family, the typical Filipino family loves TV Christmas specials and soap operas, now amplified for some in wide-screen splendor.

Photo Credit: www.bancodeoro.com

Gap takes assurance plan to the mall with Sprize

sprize1Assurances and guarantees were a dominant theme in marketing during this difficult year, helping to assuage consumer anxiety about spending. It kicked off with Hyundai’s widely copied Assurance Program. By late summer, GM was offering a “60-day satisfaction guarantee” (“If you don’t absolutely love your new vehicle, we’ll take it back”). In the online-travel category, Orbitz now offers both a “Price Assurance” program (if another customer books the same flight/hotel for less, Orbitz refunds you the difference) and a Low Price Guarantee (find a lower online fare for the same booking and Orbitz refunds the difference and gives you a $50 coupon). Competitor sites are doing likewise.

Now Gap is experimenting with putting this idea in the mall. Its Sprize program, so far only operating in the Vancouver area, has shoppers register for a Sprize card, which they show whenever they buy a Gap item; if the item’s price drops within 45 days, the difference is credited to the card. That credit is redeemable for up to a year.

This seems like a smart response to what’s become a sticky problem for retailers, which have been forced to slash prices this year, in effect training today’s value-conscious shoppers to wait for sales and offers (coupons, etc.). Since Gap’s refund is in the form of a credit, a good percentage of shoppers will likely spend extra once they’re back in the store or forget to redeem it at all. It will be interesting to see whether Sprize provides enough incentive to get bargain hunters to buy now and hope for discounts later.

Photo Credit: www.mysprize.com

India’s Kotak Life Insurance tries to ease parental anxieties

There was a time when life insurance communication was quite somber, evoking fear about what might happen to your loved ones once you die or suffer an unexpected injury or illness. Once insurance plans came linked with investment in India, however, the sector transformed. People could see money returned even if their policy expired. There are now innumerable players offering investment-linked insurance, and the field is heavily cluttered.

The gears have shifted accordingly in communication, which now features vibrant, upbeat imagery—illustrating freedom from tension because your loved ones are secure just in case. The latest effort from Kotak Life Insurance, an established player, adopts a somewhat different approach. Its new brand positioning is “Faidey ka insurance” (insurance that’s financially rewarding), appealing to the rational rather than the emotional side and approaching insurance the same way as any other investment product. (This is backed by the fact that Kotak is also a well-known investment player with expertise in research and capital markets.)

The TV commercial features a Kotak agent in a living room, discussing child insurance plans with a family; as he talks about parents wanting their kids to take up various professions, the child here turns into an astronaut, doctor, cricketer and rock star. The agent notes that a child’s career path can’t be guaranteed and neither can the returns of a regular insurance plan. He describes how Kotak’s Child Plans ensure better returns, which helps parents finance the child’s education. The agent leaves with a piece of friendly advice: that a child must be given room to make his own career choice.

Desperation play pays off for GM

I’d written earlier that GM’s satisfaction guarantee was an act of desperation, something a car company would do when it had few, if any, other options. Desperation move or not, early results show it’s working, with GM’s sales up 5 percent in October in an overall flat market. All four of GM’s surviving brands were up for the month.

It wasn’t just the guarantee: GM hit the airways hard, heavily pushing the “May the Best Car Win” theme, with Chevrolet the primary focus. And incentives were up substantially, especially for Chevrolet, and the trade-in data suggests it’s overwhelmingly GM buyers coming back for another.

But none of that matters right now. Market share was up, and GM is hinting that November will be strong as well. GM needed a big month, and some good news, and got both. The guarantee seems to be what got the ball rolling, so it has to be judged a success so far. Sometimes desperation plays pay off.

gm-may-the-best-car-winPhoto Credit: www.gm.com

Little-known financial brand leverages Wall Street disenchantment

Sun Life

Once admired for their financial acumen, well-known brands like Citi, Morgan Stanley and Goldman Sachs (and, to a lesser extent, any of the hundreds of firms that took federal bailout funds) now have a vibe of wanton recklessness, if not outright criminality.

Sun Life Financial sees an opportunity in this. As its president recently stated: “Sun Life has a 144-year-old record of financial security, over 20 million customers worldwide, and excellent financial strength ratings, yet U.S. consumers are not familiar with our brand.”

A new campaign, “Get to Know Sun Life,” focuses on the fact that Sun Life has never needed a bailout and emphasizes its long, strong track record of consistent returns. Perfect timing on this: Some people will never again trust the big Wall Street firms, so a company that can offer a clear, safe alternative will get fresh consideration.

Photo Credit: www.sunlife.com

Can GM’s money-back guarantee get it on car buyers’ radar? Not likely

General Motors knew a post-bankruptcy world would not be a friendly place, but August’s 20 percent drop in a month when the auto industry was slightly up—dealers were swamped with Cash for Clunkers deals—was an eye-opener. Something must be done to stop the bleeding, and getting on new-car buyers’ shopping lists is critical.

GM’s warranties are already better than average, however, and cash incentives have lost their potency. So GM has no more aces up its sleeve … except a money-back guarantee! New chairman Ed Whitacre explains that the “new GM” is so confident in its products that buyers can drive them for 60 days, then bring them back if they don’t love them. The tagline is “Let the best car win.”

If only it were that simple. The problem is that it’s not about the “best car” anymore, it’s about everything to do with GM’s historical baggage, recent design disasters, long-established brand images, perceived quality, record losses, bankruptcy, tax-funded bailouts, layoffs, euthanized brands, dealership closings, “car czars,” the federal government, etc. A 60-day guarantee can’t undo any of that.

The question many new-car buyers will be asking isn’t “Does GM have the best cars?” it’s “Do I want to be associated with GM in any way?” I don’t think any guarantee will change that answer for the vast majority.

Mexican tourism tries its own assurance plan to ease worries over swine flu

3100670174_73d49f9f7bHit by the double whammy of the economic downturn and the N1H1 flu outbreak, hotels chains in Cancun came up with an innovative idea: the flu-free guarantee campaign. Guests who have symptoms within 14 days of their departure and can produce the blood tests to prove it will get a free vacation a year for three consecutive years.

Desperate times call for desperate measures: Consider that in May, 80 percent of cruises and hotel reservations were canceled in Mexico; Mexican airports reported a 50 percent drop in traffic. Tourism here employs more than 2 million people and accounts for about 8 percent of the economy. Foreign tourism earned Mexico $13.3 billion last year. Mexico’s tourism minister has estimated that the swine flu could cost the economy around $2.3 billion.

In times of uncertainty, people want safety and guarantee. In this case, the uncertainty concerns not only their finances but their health—and this guarantee works on both levels. It seems to be working: Hotels that are part of this expect to see 90 percent occupancy.

Photo: Hugo Cadavez

Suzuki follows Hyundai’s lead with free gas

untitled2OK, Hyundai, I’ll see your offer of gasoline locked in at $1.49 and raise you: Free gas for the summer for buyers of the SX4!

Known in the U.S. primarily as a maker of SUVs, Suzuki has been hit hard by this downturn and consumers’ shift to smaller cars: So far, sales this year are down more than 50 percent.

So along comes free gasoline, assuaging a concern of many: the possibility of spiraling fuel costs. The memory of last year’s spike lingers, and prices have recently started to climb again. Buyers can thus rest assured that if prices skyrocket, they’ll be protected for 90 whole days! Evidently this is targeted at those buyers who live in the moment, never planning as far ahead as September.

Suzuki is desperate, and it shows. Hyundai’s offer is part of a coherent, comprehensive plan. Suzuki’s is a cry for help.