Honda CR-V

Honda is planning to launch its new CR-V model in Europe later this year/early next with a campaign reported to be worth £25m. The latest marketing for this car in the US saw an advert aired during January’s Superbowl, featuring Matthew Brotherick in reference to the hugely loved 1986 film ‘Ferris Bueller’s Day Off’. Take a peak:

Honda CR-V : Ferris Bueller's Day Off

(I personally love the not-so-subtle nod to the cars Japanese background during his karaoke performance.) However, it doesn’t look like an easy drive for the brands intentions, especially in the UK:

“Honda is currently fighting to gain share from its rivals in Europe. In 2011, the Japanese marque suffered a 20 per cent year-on-year drop in UK new car sales, according to the Society of Motor Manufacturers and Traders, with market share falling to 2.6 per cent, placing it behind Nissan, Toyota, Hyundai and Kia.” Campaignlive.co.uk

But can Hondas UK struggle really be down to tougher competition? Not entirely. The sales figures for new cars are evidence of the recession still causing impact. However, it is forecasted that by the end of this year, the statistics should show slight improvement reaching 82% of the level reached in 2006 pre-recession. So Honda is coming in at the right time to try and make the right impression as the market slowly picks up.

Getting a new car is a big deal. The consumer buying process shows a level high involvement; there are lots of elements to take into consideration in order to make their purchase decision. Price, size, fuel, safety, carbon foot print and style are to name a few of the attributes of buying a car.

Honda declared an investment in 2011 to increased job roles by 500 at its Swindon based site due to the increased production forecasts of this year. The site produces both cars and engines for the civic, CR-V and Jazz models. In 2011 the CR-V achieved 11,225 new car registrations coming only second in its category of multipurpose 4x4/SUV, to the Land Rover Freelander.

The key facts facing Honda:

1. Slow recovery of the UK economy having a lingering affect on the industry, but can hope that the improvement within the market continues.

2. Consumer behaviour of trading up – like bank accounts, your best customers are your existing ones. Honda could see better success targeting current owners of the Civic or Jazz rather than running a campaign aimed at converting alternative brand owners.

3. The UK is showing a trend whereby the number of people per household is increasing. This may be a challenge for the CR-V considering its unfitting size to the need of smaller cars.

4. SUV’s and 4x4’s are on the rise on UK roads as Mintel reveals the consumer need to be different from the average saloon driver.

5. Consumers still prefer used cars to buying new.

6. Alternative transportation is no longer a competitive substitute, but can be considered something far more direct. With thanks to the UK fuel prices rising this year and upcoming tax increases on the august horizon – driving is burning many holes in many pockets.

So who should they target? I believe sticking to the current consumer base is a solid move for Honda considering the saturation of the industry in a slow improving economy. Getting people to trade up is supported by the notion of consumers being interested in 4x4 models. In the UK the most new cars registered are in the South East, restrict this to the more suburban areas where this car would be more practical and there is a rough base for targeting the campaign.

What do they need? Consumers currently need to make financially smart decisions. If trading up gets them a better deal, then we’ve reached a win-win here. In addition to price, safety often tops the lists of car purchase decisions. Honda really should capitalise on their safety specs; collision mitigation braking system, adaptive cruise control, active front lighting system and vehicle stability assistance. It may be worth bearing in mind that the Land Rover Freelander has no focus on safety in any of its specs and features.

What do they want? Ok, something that Land Rover does do very well is appeal to the desires and imagination of consumers (Been Anywhere Intersting Lately?). Driving is an act of freedom and should be enjoyable. If Honda can translate the cheeky and liberating tone given in its US campaign, to something equally fitting to the UK market then it’s on track to turning heads and hopefully translating into sales.

Looking at their past campaigns, I have no doubt Honda will let anything less than impressive go ahead, but they’ve set their own bar quite high. I look forward to the next Honda 'wow'.

The Impossible Dream

The Cog

Honda Chior

RBS: Rectification Being Served or Reputation Badly Soured?

The recent crisis left the majority of customers without updated balances for up to a week, and some are still waiting. With the whole fiasco down to a technological glitch part of you has to admit these things just happen. We all know that modern society relies so heavily on technology and with that there is always a risk. However true this is, The RBS Group had to take a more professional and active stance, and so far they've done everything by the book:

Notify customers of issue – check. Fix the problem as fast as possible – check for NatWest and RSB customers. Send out apologetic statement and texts with updates for remaining customers – check. Keep banks open for longer to deal with back log – check. Extend customer support to mitigate outstanding problems – check. Communicate updates regularly – check.

Credit where credit is due, their communications has been regular, clear and concise. But, let’s take a moment to really comprehend what’s happened here. A brand dedicated to providing a financial service has been unable to grant its customers with their personal finances. No matter how well they’ve coped with the issue, the time it’s taken has given customers plenty of time to reconsider their loyalty.

The brand declares their three overriding goals as:

1. Serve customers well,

2. Restore RBS to a sustainable and conservative risk profile,

3. Rebuild sustainable value for all share holders.

As the brand itself states these three strategic goals as inter-dependant, it’s clear that this recent issue is a firm road block for improving the reputation. With shares of The RBS Group falling today by over 4%, it’s clear that its reputation has taken a huge blow. It goes to show that where people’s personal finance is at hand, fixing the problem and “sorry” might not be enough.

Take away the Net Assets from capitalisation and whatever is left is the intangible value - a brands reputation. The problem for brands is that it takes a long time to build up a solid reputation among customers, supplies, media and partners, but only a few seconds to completely demolish it. Maybe it’s too early to say now exactly how damaging this incident has been for The RBS Group, but it will be interesting to see in the next few days how many people have taken their accounts to competing banks. Watch this space.