Questioning Our Brand Strategy?

[TuffG929]

Christopher Barger
Director, GM Global Communications Technology

We couldn't help but notice a letter to the editor in yesterday's USA Today questioning our brand strategy and suggesting that GM might be better off with fewer brands.
We respect the author's opinion, and we certainly don't mean to single him out... but we would like to address his concern. We'd actually argue that in today’s highly competitive, highly fragmented car market, a strong portfolio of brands is critical. A typical brand today sells only about 250,000 units a year, and some of the hottest new brands like Mini, HUMMER and Scion sell way less than that. A fast-changing brandscape like this offers lots of challenges — and opportunities.
We think that as GM continues to improve its products and sharpen its brands, our portfolio of eight brands can be a competitive advantage — if we can keep each brand sharply focused and stocked with strong products. GM’s global operations help here. For example, sharing products with Opel will give Saturn new vehicles perfectly suited for import fans, while our new global rear drive program, headquartered in Australia, will soon provide Chevy and Pontiac with exciting new performance cars.
It's also important that we work with our dealers to build strong retail channels. As Buick, Pontiac and GMC come together in the same showroom, we are eliminating overlapping products and sharpening all three brands. The customer gets a showroom full of great products, and the dealer gets enough...

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[goblue]

Outlook, Acadia, Enclave, and now...Traverse, not to mention 9-6 and a Cadillac version that could be coming.

Lets go back in time a few years...

Uplander, Montana, Relay, and Terazza
or
Trailblazer, Envoy, 9-7, Ranier and (Bravada)
or
Intrigue, Regal, Grand Prix, Lumina

To me, all these groups are equally similar - sounds like empty rhetoric to me.

Enclave should have been avail with an Ultra V8 at launch and a leather wrapped dash, and the GMC needed a standard V8 with a 6K towing capacity and integral ramp. Anyone catch that the Audi Q7 can tow 6K? And Saturn's version should have been a minivan. Chevy's version should be available with traditional or sliding doors. Thats differentiation.

[63cat]

I think everybody realizes (except for some writers or Buick & Pontiac haters who live with their parents) that dropping a brand would hurt GM terribly. Sales would be lost, and never be recouped. It would send a message that GM is giving up, and GM would lose even more customers.

It sounds like Buick, Caddy and Chevy have bright futures with new products coming: the Camaro, Velite, CTS coupe, etc. Pontiac needs to be cleaned up: Torrent should be a Buick or GMC, and bring back real names.

[mkaresh]

I've always been for better using the brands they have, not dropping brands.

I think the B-P-GMC strategy is brilliant. But the Lambda execution within this strategy isn't the best. I suspect that the Acadia was approved before the channels were combined.

And GMC isn't making a whole lot of sense just yet. Look at the Acadia. Is it the sportiest Lambda? The truckiest Lambda? Seems a bit of both. Is GMC about upscale trucks? Or sporty trucks? I know where Buick's going and where Pontiac's going. I guess GMC is the truck counterpart to both Buick luxury and Buick sportiness. But then when both Buick and GMC have vehicles off the same platform...

[CADILLACSIXTEEN]

I agree... when it comes to the Lambdas, it does get a little cloudy with the overlapping and the direction of each.

But this Lambda project was taken on right in the mix of the of the whole "turn around plan", so if the Lambdas are an example of the worst execution of overlap we'll see due to it being partly developed in the "GM dark-ages", I'LL SURE AS H*LL TAKE IT!!!!!!!!!!!!!!!!!!!

because if this is what GM is capable of with limited resources, the future looks great as they get more and more back on their feet!!!!

[E. Haskell]

As long we don't have a G5/Cobalt rebadge....

I'd say 99.9% of people would never mistake a Enclave for an Acadia.

[momolos]

I mean what is wrong with the Lamda CUV?
None look alike except the sides of the Acadia and the Outlook. And just the doors really. Even the third glass on the side is different between the Acadia and the Outlook. And the interiors are totaly different. Now the Enxlave looks nothing like either of those trucks...Period!
We have to wait and see what the Checy version will look like.
But I like all three versions right now a lot.
I am glad that Chevy is getting one also b/c they need a larger than NOX CUV.
I mean in my opinion Chevy needs to be in every single segment in the industry. If Toyota and Nissan keep the 4Runner and Pathfinder Chevy better update the Trailblazer also. Just a new body and interior on the same platform.
I don't want Chevy to give up on any segments to Toyota....they already have with minivans and in my book that is already one segment too many!

[rsbaker]

Originally Posted by mkaresh

I've always been for better using the brands they have, not dropping brands.

I think the B-P-GMC strategy is brilliant. But the Lambda execution within this strategy isn't the best. I suspect that the Acadia was approved before the channels were combined.

I agree! If they had this decision to make again it is clear that Acadian should have been a Chevrolet. The only argument for Acadian being a GMC would be that GM wanted a lower cost version that wouldn't require Buick to sell stripped down versions of the Enclave. With the GMC Acaidian. Buick is able to sell and Enclave with and air of exclusivity.

[boblutzfan]

Originally Posted by E. Haskell

As long we don't have a G5/Cobalt rebadge....

I'd say 99.9% of people would never mistake a Enclave for an Acadia.

Agreed. I don't understand why so many people must bitch about this. The Acadia and Enclave share different exterior sheetmetal and dramatically different interiors. Yes they are off the same platform - but as you say the average consumer will not tell the difference.

And for those that say the Lambda program is the same as GM's failed minivan program - remember that the minivan program did not fail because too many brands had rebadged versions. It failed because the vans were uncompetitive and didn't have the key features that the market demands - primarily fold into the floor seats. Look at Chrysler/Dodge. The vans are nearly identical and have been for 24 years yet they have always led the industry in sales. They lead because of the combination of features the market wants and the pricing they offer.

GM's minivans sucked. They were too narrow, didn't have fold flat into the floor seating and were uncomfortable compared to the class leaders.

The Lambda's don't suffer from being inferior to other CUVs. They have class leading power trains, a class leading innovative interior, great styling and are in a segment that is growing at break neck speed.

So drop the comparisons to the horrible GM minivans. GM has an excellent CUV that is proving with growing sales each month - that the market likes them infinitely better than the horrid minivans they sold in years past.

[boblutzfan]

Originally Posted by rsbaker

I agree! If they had this decision to make again it is clear that Acadian should have been a Chevrolet. The only argument for Acadian being a GMC would be that GM wanted a lower cost version that wouldn't require Buick to sell stripped down versions of the Enclave. With the GMC Acaidian. Buick is able to sell and Enclave with and air of exclusivity.

The GMC Acadia is selling like hotcakes. Having it and the Enclave in the same show room will work just fine - they appeal to different markets.

[mgescuro]

We think that as GM continues to improve its products and sharpen its brands, our portfolio of eight brands can be a competitive advantage — if we can keep each brand sharply focused and stocked with strong products.

IF GM continues to sharpen its products....
IF GM continues to differentiate between the brands....
IF GM can begin changing perceptions....
IF GM can upgrade the dealership experience...
IF GM will quit building cars just for the sake of building cars....

THen yes, 8 brands can be a competitive advantage.

However, 4 Lambdas? 2 of which are almost nearly rebadges? Equinox/Torrent? Cobalt/G5? Malibu/G6/Aura? The reversion of the Cadillac renaissance? 5 Buicks? No SLS or Park Avenue? Inconsistent interiors across the board?

Sorry GM. You're talking the talk, but you have yet attempted to walk the walk in my book. The brand strategy is correct. The execution is flawed.

[KingElvis]

The Acadia overlap might be an exception to the rule. I think we'll see generally less overlap as the years wear on.

[windvale]

Yeah, right. GM needs Chevy, and Saturn, oh - and Buick...and also Pontiac. RIGHT !

Dream on. If you went out on the street and asked regular folks to name a car that Honda makes - they'd say "Accord" in like 2 seconds. Ask those same people to name a car Buick makes...they might struggle and then come up with "Century" or something.

GM needs to focus on promoting a core of cars. A broad portfolio of car/truck options is a great idea, but do it under just two or three brands.

[throwback]

Originally Posted by mgescuro

IF GM continues to sharpen its products....
IF GM continues to differentiate between the brands....
IF GM can begin changing perceptions....
IF GM can upgrade the dealership experience...
IF GM will quit building cars just for the sake of building cars....

THen yes, 8 brands can be a competitive advantage.

However, 4 Lambdas? 2 of which are almost nearly rebadges? Equinox/Torrent? Cobalt/G5? Malibu/G6/Aura? The reversion of the Cadillac renaissance? 5 Buicks? No SLS or Park Avenue? Inconsistent interiors across the board?

Sorry GM. You're talking the talk, but you have yet attempted to walk the walk in my book. The brand strategy is correct. The execution is flawed.

Exactly! In theory all of their brands "could" be an asset. When has the current GM management shown the ability to manage their brands well? It's always about "wait until..." with GM. How about just doing it and then thumping your chest after?

[ericmvest]

Current conventional wisdom is that General Motors has too many brands. For decades the conventional wisdom was that General Motors' brand structure was a competitive advantage. Ford introduced the Mercury and Edsel brands and Chrysler introduced the Plymouth and DeSoto brands to address General Motors' band structure. I think General Motors brands can be a competitive advantage if managed correctly. Each brand should have a distinct, sharp image. Since General Motors has merged Pontiac, Buick, and GMC Truck into one dealership body, each of these brands should have the freedom to go after a focused market without the pressure of having to sustain the dealership body by themselves. General Motors' Pontiac, Buick, GMC Truck strategy has great potential.