A couple of continents ago, I owned a coffee table book called “Quintessence.” Each glossy page featured a black and white product portrait: an Oreo cookie, a Steinway baby grand, a Timex watch, Bicycle playing cards, etc. The author posited that these instantly familiar products represent the essence of a thing in its purest and most concentrated form. The book didn’t contain a quintessential automobile, but I reckon a base Porsche 911 or a Jeep Wrangler would have made the grade. Not a Cayenne or a Compass. And therein lies a tale.
Let’s assume that most brands are built on a single, iconic product. When is it OK to extend the brand, to riff on the elements that made the original product such a success and create something new to increase profitability? The obvious answer: when sales of the original product go flat or, worse, flat line. The 911 may be THE Porsche, but sales of the venerable model have tanked more than once– to the point where the German automaker’s independence and survival were seriously threatened. Who can blame Porsche for developing 914’s, 928’s, 944’s, etc.?
Yes, but– the fact that all these models have come and gone is equally relevant. Despite the entrance of the astounding Boxster, the accomplished Cayenne and sublime Cayman, the 911 still gives the brand the luster and prestige that makes Porsche Porsche. When challenged about the development of the Cayenne or the Panamera four-door, the German automaker maintains that new products support the development of their “core” (i.e. quintessential) product. They have both the sales figures and the killer 911 to back them up.
Chrysler wields the same logic. When I spoke to a PR flack about the new Compass, he freely admitted that Jeep’s new “soft roader” wasn’t faithful to “the central brand proposition.” But hey, the new and improved Jeep Wrangler is! He invited me to share his belief that it was OK for DCX to sell a faux off-roader because the company still caters to Jeep customers who want “the real deal.” Jeep fanatics may argue the point, but this twin-track brand philosophy has become the de facto standard industry-wide.
The financial success of automotive brand extensions seems to make a mockery of the traditional counter: non-quintessential products are a short term fix that eventually erode the parent company’s profitability. After all, iconic models like the 911, Wrangler, BMW 3-Series, Mercedes SL, etc. still fly the flag for their manufacturers. And the companies behind these vehicles– and their non-core companions– are healthy and prosperous. And yet brand extensions are an insidious force, like a slowly leaking tire. They gradually waste precious resources where their corporate sponsors can’t see it: design, marketing and service.
Even if a new vehicle shares a platform and production facility with an existing product, it costs tens of millions of dollars to develop. As in Hollywood, the new product’s marketing and promotional costs are often just as high as the cost of design, assembly and distribution– especially when you figure-in the salaries of all the people generating the launch programs and support materials. Service equipment, parts inventories and training drain even more cash. And every new model adds another layer of corporate bureaucracy, which competes with existing fiefdoms, which slows down the whole organization.
More than that, new products take money away from the older core products. You only have to click on a manufacturer’s media site and see the small range of pathetic PR pictures for well-established models to realize that new vehicles get all the marketing bucks. The lack of investment in an automaker’s quintessential car or cars creates a vicious circle: less marketing = falling sales = less marketing = falling sales. The core products get neglected to death: Ford Taurus, Cadillac Fleetwood, Mercedes 190, Rolls Royce Corniche, the entire Oldsmobile line, Buick Park Avenue, etc.
Car companies lucky enough to make a quintessential product should be endlessly and relentlessly promoting them. Instead of building the Panamera, Porsche should get as many people as possible behind the wheel of a 911. There should be six 911’s in every press fleet in the country. Every Porsche dealership should have a selection of 911 loaner cars. By the same token, Jeep should create off-road courses at or near their dealerships and do everything it can to get people to assault them in a “proper” Jeep.
All of these marketing efforts would cost a fraction of the money required to launch a new model. By reaffirming in the public’s mind what makes a given automobile manufacturer great, they would also add to the appeal of any brand extensions flowing from the original, well-loved vehicle. Concentrating on your core vehicle is, in fact, the quintessential business strategy for long-term growth and sustained profitability.
Right on. The very concepts of a big Porsche, a cushy BMW, a road-locked Jeep, etc. are offensive to the brand loyalists that are so important to a brand’s survival.
Well written article Robert. And also something the big car makers should seriously take note of… But surely there is a golden line somewhere of when it just does not make sense to promote something anymore?
[as an aside there is no such thing as a Rolls Royce Cornice! It is a Corniche. The former is a bit of wall!!]
As long as necessary improvements are made (without screwing up the product's core appeal), a quintessential product never falls too far out of fashion. And if it does, it often comes screaming back when children who grew up with it return to their roots. I'm thinking Jello, Rolex Submariner, Camel cigarettes, Skippy Peanut Butter, Montblanc Meisterstuck, etc.
Corniche. Doh!
The last two paragraphs say it all. That marketing effort combined with continuous product improvement (updated style, latest safety features, etc) is what makes a long-term winner. The 911 embodies this belief, and has always been true to itself…with profits flowing in along the way. The Corvette is similar, but GM is no Porsche in the product nurturing department.
Heck, all Ford had to do was call the Fusion the 5th generation Taurus and their marketing efforts would dig into people’s minds faster and go farther with less resources.
After the debacle of New Coke, and the continuing example of P&G brand management you would expect this to be basic business 101. But, Chevy pretty much killed the Impala and just shrugged. They have had a couple of half hearted attempts to revive it but… It is interesting that both Ford and Chevy spend so much time and effort on their half ton pickups to maintain their brand/image through continual upgrades, but their car lines have to fend for themselves. Very strange. You would think that over the last 35 years Ford and Chevy would have moved heaven and earth to maintain the Galaxie and Impala lines as THE main family movers for mid-America, but instead they do weird things, like putting the Malibu name on the most un-Malibu type vehicle they could have possibly thought of short of slamming it on Renault or a Fiat. Is this stuff really that difficult? Help me!
“All of these marketing efforts would cost a fraction of the money required to launch a new model.” -It would probably also only generate a fraction of a fraction of increased sales.
It’s an unfortunate part of the business side of the car business that expansion is neccessary. It true for any business. Coke’s sales numbers don’t drop off, but if they don’t expand, the stock price takes a hit.
Looking specifically at Jeep, there aren’t enough “core” drivers to keep that company in business. With rising gas prices, people who liked the product, but weren’t off-roaders stopped buying the product. Jeep has the choice, make smaller, less robust cars, or fill the lots with great off-road vehicles no one is going to buy.
Only a very small-market manufacturer that has no desire to grow beyond their core can stay true to their identity and hope to survive.
Pullman made some of the best railroad cars in the world right until it dissppeared.
Well, I think the issue is one of borrowed interests with the goal of moving more units from a cost-shared platform…
That is to say: “Hey. Mr. Just Made It, driving your new ‘Ultimate Driving Machine, wouldn’t you like to see more and go anywhere your sports-active lifestyle desires? Wouldn’t you like to lord OVER all the other cars like your Explorer-driving peers – only in BMW fashion? Well, we have this X3 thing just for you. It says: mid-level executive, moving up and ready to take on anything.”
You know, we’re not selling cars, we’re selling self-esteem and personal brand identity.
Cowbell:
I disagree that you have to expand the brand to make money. Many executives head in that direction because they run out of energy/interest/belief in their existing product.
Has Porsche sold so many Boxsters that they’ve tapped-out the market and NEED another model and another market? I don’t think so.
BTW: When Coke fractured into all those products, their market share stayed the same but their costs rose.
I’m sorry. I wasn’t clear with the point I was trying to get across. Trying again:
Are the automotive types mad because Jeep is making the non-offroad Compass, or because the Compass is a crappy car?
I think a lot of people are getting an inconsitent brand identity confused with letting a good product wither on the tree.
I think it’s neccessary for Jeep to change with the times if they want to survive.
A quintessential product stands apart from the vagaries of fashion. The packaging may change (and it may not), but the product’s appeal is timeless.
Robert, I agree that a company doesn’t need to grow to make money. The problem is that growth is very, very important to investors. Executives at publicly held companies know this, and act accordingly. Of course they make bone-head decisions in many mis-guided efforts to expand.
“If we make money selling 2000 cars, we can make twice as much money selling 4000 cars.” That kind of thinking usually leads to killing the golden goose, but that’s how Wall Street tends to operate.
As for Jeep and Porsche, I think they are two very different beasts, based on their sizes and customer base. Last month Jeep sold 42,243 units and Porsche sold 2,397.
It would be great if jeep had stayed small, building what they build best, but it’s too late now. Over 80% of Jeep’s sales come from the Liberty, Grand Cherokee and Commander, most of which will never leave pavement (except of course when the Commander goes under water).
I have no way of knowing this, but I imagine that core Porsche’s driver accounts for well over 20% of their sales, so it’s is much, much easier for them to return to just building what they build best. It’s too late for Jeep to do that without it (and its entire group) going bankrupt. And I doubt the owners (shareholders) would willing let Jeep just throw in the towel so it could purify it’s brand image.
I have to disagree with the basic premise that expansion is not necessary. It is very necessary.
50 years ago when each brand had one, perhaps two different models (not just trim options), the market was pretty shallow as to meeting the customer’s needs. Once expansion brought small, medium, and large (i.e. Falcon, Fairlane, Galaxie), the market was better served. To maintain loyalty as needs change, we’ll get off-topic vehicles (like the Compass, which for the life of me I can’t understand how it passed the visual inspection & approval…..).
While I may not agree with some of the entries, I can’t blame the manufactorers for these attempts. Porsche? Why not a sporty small SUV or 4 door model?
To be a one-trick pony is to commit market suicide.
On the other hand, I think MB has really overdone it with the R, GL and a few other models……
Cowbell — interesting point.
To imitiate Farago — let’s look at Porsche. Specifically, the Cayenne.
In it’s base form it is a joke. An ugly, ugly joke. But, Porsche being Porsche, the Turbo versions of the Cayenne are very serious engineering statements.
While admittedly numb compared to anything else in the Porsche family garage, the handling and performance of those big brutes is startling. Coupled with the best off-road ability currently being sold to consumers (short of H1s and Unimogs) is mind bogggling.
So… that’s a tough call. The Cayenne made Porsche rich, the Turbo models are for real and the base model is a fork in the eye of anyone who has ever bought a Porsche…
With the Compass… it ain’t going to make Jeep rich, it will never blow anyone’s mind for any reason… and it is so ugly I’m angry.
Lose, lose I think they call that.
While I wouldn’t by a Compass, I understand Jeep’s desire to grow the brand. I am sure Jeep purist would refer to this as bastardization…and they would be right to a point.
To be more clear, if I want a premium beer, I buy Heineken. Have your tried Heineken Premium Light? Well, in my opinion it’s a big dispappointment in the taste category, but someone, somewhere wants it…maybe even likes it.
At the end of the day, if you want small SUV that climbs like a mountain goat – you walk past the Compass and head straight for the Rubicon. However, not everyone needs (or understands) those world-class capabilities. To reference CliffG’s comment regarding New Coke….perhaps the Compass is a Diet Jeep.
The automotive market is evolving and I think Jeep is trying to embrace that.
(shakin head and kicking rocks) Its a damn shame what GM did to the Impala.
"The lack of investment in an automaker’s quintessential car or cars creates a vicious circle: less marketing = falling sales = less marketing = falling sales. The core products get neglected to death: Ford Taurus, Cadillac Fleetwood, Mercedes 190, Rolls Royce Corniche, the entire Oldsmobile line, Buick Park Avenue, etc.
BMW has brilliantly grown while maintaining its core buyers. I cannot remember the last time I saw a commercial for BMW in Ohio…but the 3,5 and 7 series are everywhere. Praise about those wonderful driving machines travels fast from enthused buyers. I wonder what BMW spends on marketing?
BMW enjoys making cars and it shows in the performance and its core followers. Its not a Acamedes principle.
BMW wants to target a vibrant, younger, gas conscience audience with the 1 series. Im not sure its a good idea with Infiniti in the rear view mirror.
I agree with Robert to to an extent. But just as some have failed and neglected their core products others have succeeded. Maybe you should post a couple of those companies?
I agree.
Some mfg’s have the determination to march on with succesive models eventually resulting in a winner. But sometimes the sequel does not quite fill the shoes err tires of the original or previous generation… Much determination and persistance is required to keep on working on a model generation after generation. Today it seems that there are too many attempts at one of sales like the vw new beetle or PT cruiser… its cute for a while but there is no long term.
The Neon was an established nameplate which could have been improved upon but DCX opted to nix it for the small caliber twins. Not so much persistance or determination… a neon 5 door would have done the job just fine imo… but I’m sure the marketers would have said it wouldn’t have sold.
I’m one of those superficial status symbol types that takes a considerable amount of pride talking about my expensive automobile at cocktail parties and business shindigs.
However, It never fails deflate my ego when someone agrees with me that BMW makes great cars, only to discover that they’re driving an X3.
Thanks Johnny Canada
“I’m one of those superficial status symbol types that takes a considerable amount of pride talking about my expensive automobile at cocktail parties and business shindigs.
However, It never fails deflate my ego when someone agrees with me that BMW makes great cars, only to discover that they’re driving an X3. ”
That was the best inside laugh I’ve had all day.
Buying a new car when you have to do it can be very pressing if you don’t have the time to shop around. But if your dealership had the sense to put you in some different “future cars” as loaners, you would know exactly what you wanted – and what to avoid.
At the risk of repeating myself, brand extensions are almost always a short term tonic. But they contain within them the seeds of a brand’s destruction.
Since my dad bought home a used 1960 STRATO CHIEF [canadian pontiac]
I have been a PONTIAC man.Firebird,Grand Prix,Grand Am,G.T.O yeah! thats a PONTIAC.But a Transport,a Montana or heaven save us an AZTEC,no way never be a PONTIAC, not in my mind.
Farago has it backwards. If the line extensions are profitable, they aren’t starving the classic, they’re providing resources to support it. There’s also the potential benefit of cutting unit costs by increasing volume, thereby making the classic more profitable and enabling the manufacturer to keep improving it.
I’m also dubious of the notion of watering down the brand. To serial 911 spendthrifts like myself, the 911 IS the brand. I’m grateful that Porsche has found a way to remain consistantly profitable over time through a balanced lineup, if only because it means they can keep making 911’s. And I haven’t seen any evidence that Cayenne or Boxter have somehow taken development manna out of the 911’s mouth ; my 997 is improved in every way over its 996 predecessor. In fact, a little more parts commonality would be appreciated-why does the apparently identical radio/display/whosits in the Cayenne support Bluetooth and satellite radio while the 911 remains incommunicado?
I’m not a Jeep guy but it seems to me that you’re either a Wrangler wrangler or you’re not, and everything else in the showroom is likely irrelevent. Likewise, I’ve shopped Corvettes and had no problem with abutting Aveos or salesman attired in warring shades of plaid. If the Vette had held up as a driver, that would have sufficed. After all, it’s a classic.
And there you have it, once again: the standard justification for brand extensions.
Forget Porsche and Jeep. I've already pointed out that their core models are still quintessentially quitessential, and their business hale and hearty.
The argument against brand extensions is solely concerned with long term effects. If you can't look forwards to see the dangers, look backwards.
What about Cadillac? Didn't badly badge-engineered brand extensions seal their fate? Will their rep ever recover? Surely they would've been better off building and selling one or two luxobarges worthy of wearing the nameplate that once adorned the V16. CTS, STS, DTS, XLR, Escalade. Which is the brand's core vehicle? Which of these will still be around in 20 years?
And what about Hummer?
Now that the H1 is dead, who on earth cares about the H2?
Why do the other Hummer Models even exist?
RF’s central point is undeniable, Jeep needs to make products that are extensions of the essence that is Jeep, to spend vast sums of money to rebadge a Caliber is a waste of money and talent. It does not “extend” the brand, it diliutes. Harley Davidson does not build sport bikes, it leaves that to its’ subsidiary Buell, and Jeep should leave “soft-roaders” to Dodge. Perhaps Honda can get away with building everything, but its’ big cruisers have to sell for $10k less than Harley’s to move them out the door. However the CBR1000 Fireblade is fabulous, and that is what Honda’s reputation is based on (and trust me, Honda doesn’t screw around with that “CBR” identification). Jeep should not make everything, even if DCX wants to. If you are lucky enough to have an iconic brand, don’t FUBAR.
Home brewer…
My apologies to Mr. Lieberman regarding my example of Heineken as a premium beer….
Home brewers are tough to please! Feel free to send me a sample of your art for my future site…The Truth about Ales!
I have seen BMW advertising in Ohio – its always for certified pre-owned though. Almost never for new cars.
Suprisingly I am seeing just as many 7-series as 3-series now.
RF’s point is is kind of valid but in industry, especially the automotive you need to grow and expand so you can’t rely on one vehicle. Jeeps core customers are too small to support the company as is, and so has a limited market. Rakinyo1 has summed it up with an expansion that has allowed a company to grow successfully, where has the danger been for this company RF i see none? Land Rover is another company that took reputation and new niche opportunity to carry on and expand successfully, their market for the original Land Rover/then Defender couldn’t support the company as the world grew and evolved so they had to adapt. And theres the key word, as in nature you evolve and adapt or die, just as in the business world as so many companies have done. Maybe you should buy some new books RF?
When are we having a Chrysler Death Watch? Quite soon if they followed your thinking of one vehicle, one brand one big world.
I wonder what was wrong with the 911 in the first place that caused them to start building 914s 928s and the other shootoffs. Sure, maybe they just made new models to impress investors, but what if your quintessential product is something that doesn’t have everlasting appeal? Maybe that means it never was a quintessential product in the first place?
Maybe some brands’ quintessential product isn’t a physical product at all. What if your brand sells a quintessential trendiness or a quintessential user perception? In that case, constantly changing your models would be allowed or even required in order to keep your quintessence (quintessentialness? quintelssentialality?).
I guess it comes down to really understanding your brand. Is Porsche the company that sells you tight handling quick exotic coupes, or is it a brand that sells you cars that make you feel trendier and more knowledgable than the guy in the Corvette? You old-timey car guys would pick the first choice, “Porsche makes 911s”, and you would be right. Ah there’s the problem – what Porsche is doing is not just making a buck on a half-baked product, they are trying to change their quintessential product from a car to an idea (aka a “central brand proposition”).
Most of these long standing car companies have physically quintessential cars or trucks. They all think a quintessential idea would be more profitable. Quintessential products can’t really be changed though, that’s the whole point…
Boston Tea Party,
The reason Jeep is in trouble is because they killed the Cherokee (which was still selling 120,000 untis per year up until the axe) and tried to replace it with the cute but fat Liberty.
In other words, the Compass is just a decontented Liberty.
They should have brought back the Cherokee.
Maybe next decade.
Mr. Farago,
The way you paint this arguement is that you have a choice or extending the brand or building you core vehicles.
I believe that is a false choice. I think the arguement is that brand extension can be good as long as other vehicles aren’t neglected.
It all comes down to good product. Cadillac was making stupid decisions even when it wasn’t branching out. Back when it was pretty much just the Seville, Deville, and Eldardo, they still managed to screw up (especially the El Darado in the 80s). If anything, branching out is the only thing that saved Cadillac from death.
Sports cars have yet to go out of style. Good for Porsche.
Land Yachts did go out of style.
It’s easy to keep your core in shape when times are good. It’s more important to do it when times are bad.
Jonny L,
Isn’t this about the Wrangler though? and call me Johnny foreigner but isn’t the Cherokee still out there even in the guise of a Laredo or whatever its called. Just been modernised and as with all vehicle models its grown up a bit?
Jeeps problem is more to do with a clustered product line with too much overlap and pricing, but then if they only had 1 or 2 products they wouldnt be here. All swings and roundabouts.
Re: Cowbell
“I think the arguement is that brand extension can be good as long as other vehicles aren’t neglected. ”
Yes well I think they should sell their cars for infinity x 10 dollars and build them for a cost of $0. In reality though there are tight budgets.
You may be right about Cadillac though. If you screw up bad enough you might eventually branch out in a circle and accidentally build a car that matches your original brand quitessence.
As always, excellent article. Brand extension is good, necessary and potentially very profitably if it meets two criteria:
1. It is well executed. Following the Jeep example, the only virtue of the Compass is that it gets better gas mileage than any of the other Jeeps. In every other respect it fails in execution: on-road performance, off-road performance, looks, etc.
2. It does not confuse the brand image. Can someone tell me whether Chevy stands for economical cars or high-end sports cars? Is Cadillac a luxury car line or a truck manufacturer? The brand image should mean something. Porsche = exceptional on-road and track performance. Jeep = exceptional off-road & severe weather capability. I would not mind the Compass if it were a well executed alternative to the Subaru Outback, Audi Quattro wagons, or Volvo XC70. There are plenty of rugged sporting types that never wish to leave pavement that live in the Snow Belt or ski resort regions for Jeep to have preserved its X-Games image. Instead it is a being marketed as the Urban Jeep. Confusion.
WCM, #2:
yeah following my earlier formula I would say Jeep is confusing us by trying to change their quintessential brand image from “we make great off road jeeps and cherokees” to “we make products with a more stylish rugged appearance than most of our competitors, with a mid-range value/price point”
I won’t be surprised when I hear plans for a new (first?) Jeep sedan with a more rugged appearance than the Sebring, kind of like a DCX “Outback Sedan”. They will follw that up with a line of stylish outdoor gear and rugged outdoor capable portable electronics – the Jeep Tent, jPod, jBook etc.
Jonny L & BostonTeaParty,
The Cherokee is alive and well. Outside of the US the Liberty (KJ platform) is known as the Cherokee.
It is porky but there is a blossoming and vital aftermarket for Liberty modifications as there was (is) for the original Chrokee. Check the Liberty Owners site for examples of some of the serious off-roading that KJ owners are doing: KJ Lost
Furthermore, it is hardly a failure. Last time I checked it was still the best selling SUV in its class. No brand confusion. Generally well executed.
This is why I like what Toyota did. Make up a new brand (eg Scion) and keep it focused.
Jeep’s mother company SHOULD expand into new markets. But it has better brands to do so. If Jeep needs money from other segments, that money can come from Dodge. Porsche didn’t have that option, so it was easier to justify its froglike financial savior.
The ultimate quintessential brand is perhaps the VW Beetle. The old Beetle. They were practical, frugal, and easy to repair, and they certainly made a statement. They were commonly thought of as “ugly,” but they were not. After I started photographing cars, I realized that Beetles had more artistic integrity than most cars. If they’d kept making them, but made them safer, etc., to meet today’s market, they might still be making them.
Ironically, the New Beetle is the opposite: a totally impractical fashion statement.
Anyway, I’m in strong agreement with the thesis of this article.
William C.
It sells well, but nothing like how the Cherokee sold.
And it is ugly and fat next to the much svelter Cherokee.
I guess I dont have a problem with extending the brand. I do believe there is a huge gap definition between extending a core vehicle and badge engineering. Some put a negative spin on it while others apply a “quintessential” positive spin.
Ferrari will introduce a new entry level automobile to replace the modina. Bentley introduced the Continental GTC. If either company ever decided to further extend these vehicles down to a paupers range over the next 20 years I would not give a crap. As long as it is a quality vehicle who cares!
Lexus flagships run just as well as their entry models. Hell Camry is the best selling vehicle in its segment for 9 years running. All ran by the same little company behind the green curtain marked “OZ”.
Sure there are perils Robert, but there is also safety. And lets not forget in the auto industry or in any business both are profitable because of core followers. Even Jim Jones had a cult following that worshipped the ground he walked on.
Long term, Toyota’s FJ40(original version) has already quintessentially mastered core extending for over 20 years…40series 60 series and 80 series.
C’mon Robert.
GM mocked the same foreseen magic tricks at another birthday party. Surprisingly only the Escalade came out the “King of Bling”. Cant blame them for trying. And so what if they are not selling anymore or are horribly badged. Just cut your work force by closing a couple of plants or lay-off a few thousand workers. Let the dealers do what they do best. Deal the crap off the lot until contract time 2006. Its all profit, you build it for 10grand and sell it for 50. Rabid Rick has every reason to make the golden rules. Even if/when GM dies.
re: “Instead of building the Panamera, Porsche should get as many people as possible behind the wheel of a 911.”
an interesting point-of-view, robert, but how do you square it with the fact that the boxster actually ‘saved porsche’ by enabling it to remain an independent automobile manufacturer – with a new, highly desirable product offering – rather than become a prime candidate for acquisition?
in this instance, porsche’s quintessential 911 was simply incapable of generating sufficient sales numbers required to keep the company solvent, regardless of all the evolutionary enhancements it has benefitted from over the last 40 years.
The old cherokee was a great example of properly extending a brand…the new compass is not. Why is it that building a pure statement and a car that appeals to a wider, it’s-only-an-appliance crowd have to be mutually exclusive? The Cherokee was not only a legendary vehicle, purchased by the likes of salty mountain men who came down out of the Rockies once every couple of months. It was also a terrific, reliable, everyday, grocery-getting wagon with handsome styling and a tastefully understated promise of its truely heroic capability. Sure, many thousands were sold as 4×2’s in the southeast, and many have never seen anything more than a grassy meadow at a labor day BBQ, but the core vehicle screams vision and purpose.
It’s fine to grow a brand, but that’s different then trying to pedal a platform to the public that has no discernable capability by which it seperates itself from other vehicles (good-gas-mileage is not a capability). That is simply trying to grow somebody’s business case for a particular vehicle architecture. Proper growth of a brand would go something like this-
VISION – Lets take the Jeep values of true rugged off-road capability to a b- segment type vehicle
DEVELOPMENT – Lets spec out a vehicle which has A,B and C capabilities and then find an acceptable platform/architecture that meets those specs or investigate the possibilities of developing a new platform, with these maximum capabilities, which then might trickle down into other, less iconic brands.
PRODUCTION – Finally we have a b-segment car which adheres to the Jeep values of best-in-class capabilities while providing a world class platform from which other brands can also benefit.
What Cowbell describes as brand growth, is really a misnomer. It is all too often from the justification of a short sighted business case that these forgettable cars make it into the marketplace, and may even sell well for a time, but in the end succumb to their precisely measured mediocrity as little more than 2 ton commodities. For less specific brands this may not impact the overall image as much, but if your reputation is built on delivering a certain unique capability why not try to be on message every time.
Jonny,
So true about the Liberty’s weight. I guess Renault’s influence on Jeep was not a complete failure. It is my understanding that it was the Renault wizards that engineered excess weight out of the old Cherokee (XJ) platform. However, I ride to lunch each day with a friend that owns a 2000 Cherokee. Compared to the Liberty, it a rattle-trap tin can. That is to say that the Liberty has such a great interior and ride quality, but XJ was really that bad and needed to go. Did it require 800 lbs to accomplish this? IFS is heavier than the solid front axle it replaced, but… 800 lbs? Please.
If Porsche had focused strictly on the 911 we wouldn’t have the Cayman. The consensus seems to be that the babygator is a better sports car than the 911 and with a few more ponies it would render the 911 obsolete. I call that progress.
William — agreed — still , there was something… soulful about the Cherokee (I owned a ’98 and a 2000) that the Liberty completely abandoned.
Plus, that straight-6 was one hell of an engine.
And again, the design of the Cherokee is one of the very best of all time, especially the ’96 remake.
Jonny,
Agreed.
carlisimo:
September 19th, 2006 at 5:17 pm
This is why I like what Toyota did. Make up a new brand (eg Scion) and keep it focused.
Jeep’s mother company SHOULD expand into new markets. But it has better brands to do so. If Jeep needs money from other segments, that money can come from Dodge. Porsche didn’t have that option, so it was easier to justify its froglike financial savior.
I agree completely. And yeah, now that you mention it, the Cayenne really does look like a frog, although not in a good way. (The mid-70s AMC Matador was a much better looking, if not quite so sleek frog.)
Robert,
I agree with the premise. Hell, if you want brand extension look no further than my personal (and moderately stylish) ride, a 1973 Jeep Commando (nee Jeepster). Willys built the original in the late 40s to complement the agrarian bent of the Universal/Station Wagon/Pickup lineup back then and its sales then were dismal. Kaiser took a stab at putting the roadster body on a CJ-6 in the mid 60s with moderate success against the IH Scout, then AMC bought the company. Mr. Lieberman’s beloved I6 necessitated a longer snout and brought the hideous “bullnose” version that sits in my driveway.
In its final year, 1973 (sigh) they built about 1,900 of them and despite the parts-sharing economies, made no money on the venture. The brand wasn’t diluted then despite the terrible reviews. It just faded away.
The concept was sound, I think. A go-anywhere, but mildly stylish, runabout. The gentleman rancher’s goin’ to town car. Compass may embodied the right idea, but the execution leaves about 900 things to be desired.
Y’know that new four door Wrangler? Put a new suit of clothes on it and we’ll talk.
Whether or not a maker has a quintessential car, the key is having an identity that the public can latch onto. Boxter fits for Porsche, no problem. Cayenne makes money, but risks diluting the identity. Same with Panamerica, which from the shots I’ve seen resembles a Datsun 280zx 2+2.
Look at Subaru. They were always about reliable, affordable, all-wheel drive boring vehicles. They branched out into reliable, affordable, all-wheel drive giant-killers like the WRX, STI and Legacy GT, and it fit in perfectly with their identity.
Look at Saab. They had an identity, have abandoned it in pursuit of increased unit sales, and now rely on huge cashback offers and lease incentives to move product. Anything on a scale ranging from abandoning your identity, too much identity dilution, to maybe even one really horribly laughable product (see Cadillac Cimmaron), will spell big trouble.
I agree with Jonny about the Cherokee, the last incarnation was terrific. Suprisingly quick with an indestructable engine. In fact, the Cherokee really became an icon almost on par with the Wrangler.
The Liberty was an attempt to have the best of both worlds: Cherokee-like performance with an exterior that was more akin to the Wrangler. Unfortunately, Chrysler fell a little short in that department, and that elusive magic was lost. Not to say that the Liberty is bad; it isn’t, but that it isn’t the same icon that the Cherokee was.
There are valid points to both arguments about extending a brand. It usually needs to be done at some point, but doing it right (like Porsche) is an art that not all companies grasp (like GM has done so often).
That horrid thing that Chevy calls an Impala is an abomination on wheels!
Lotta great points here.
It’s the nature of business that some companies feel they have to have a product for every conceivable niche or segment. That’s why we have stuff like the Cayenne/Touareg, X3/X5, M-series Mercs, the Escalanche, and the Navigator. All a waste of metal, in my mind, and a costly distraction from the core business of each manufacturer.
These me-too vehicles all go out the door less on their merits as good products than they do on the image the brand carries in the market. The brand extension may help maintain market share but at what cost over time? At some point the extension can become brand dilution, at which point a BMW (for example) can become as ordinary as a Chevy. And a Mercedes as common as any Chrylser.
Profits come from selling more of something that people want while controlling costs. Only the bean counters really know whether the huge investment required to launch these models can be justified by sales. In most cases I bet it cannot. But gee, the extra sales meant a company only lost 0.1 point of share last quarter. Please. Does anyone else see a little too much focus on quarterly performance, and far too little on long term growth and stability?
I see a time coming when we have a lot fewer brands to choose from and little that’s unique as the remaining automakers continue to try to appeal to everybody.
With your argument RF how do you see Toyotas expansion to participate in every market, just as most major manufacturers do? you have to be everywhere to get anywhere.
Noley,
The good thing about design is that it won’t be like politics trying to not upset anyone who may vote by saying the wrong thing, design knows people are getting savvy and wanting their own design statement, people are getting more and more design literate these days and especially in the future. I see designs being more unique less bland and at long last more emotional. Something that will be better for the consumer everywhere. There may well be fewer brands, i see fewer major companies, more mergers, but this will make designs stronger.
The question of whether or not a company should delve into brand extension is probably dependent on how quintessential and profitable their core vehicles are. If a brand is healthy at its core, why not innovate and try to capture another market, as long as the new products support the brand identity and put cash back into core model development.
Look at VW in the ’60s. They had the bug (type1) and the bus (type2), but when they came out with their larger rear-engine models types 3 and 4, they were far too quirky and inferior to capitalize on the market. However, profits from the overwhelming success of the bug allowed VW to purchase Auto Union, giving them front-engine FWD engineering, which in the long run, saved VW from oblivion.
In today’s auto market, the high cost of product development and shortened-model cycles means that brand extension is a risky venture. For the past two decades, Ford, GM and DCX have allowed their core vehicles to languish, with declining profits to match. They must refocus brands that lack quintessential cars (ie: Cadillac). Now is not the time for vehicles like the Compass.
Speaking of “quintessential” vehicles, am I the only one who kind of likes the 4-door wrangler pictured at the top of this article? I’ve always loved jeeps but the drawback for me has been that they’re too small for passengers and cargo.
For those pining away for the Cherokee, could this be the real replacement for it (as opposed to the Liberty, which I think is just ugly and silly looking.)
Minor trivia question: What was the last 4-door convertible sold in the US? Wasn’t it the mid-60’s Lincoln Continental Suicide Door model? a 4-door convertible – I’m intrigued.
As leery as I am of American brands, that Wrangler Unlimited looks a lot better to me than the porky Toyota FJ Cruiser.
I wonder if it would be possible to slip the Liberty’s CRD into the Wrangler Unlimited….
There used to be 3 networks, 5 Hollywood blockbusters per summer, 2 colas, etc. Now there is a channel just on food, 40 seat movie theaters to accomodate dozens of smaller films, 10 Coke brands. Doesn’t the line extension feed the need for accelerated news and newness? Or perhaps you could say the line extension created this need, though technology has helped to unleash human gratification on all levels, including cars. Now that the situation is here, how do you put the genie back in? Or, as you’ve suggested, do you enact line extensions only with the quintessence (which is a good Squeeze song, by the way) that got you here.
“The argument against brand extensions is solely concerned with long term effects.” -RF
This is the heart of the argument. Recognizing that brand extension can devalue a brand in the long-term is the important point here. There have been many ways the brand extensions can benefit and hurt a brand.
Take GM, for instance. They are a huge company, the sell volume not bespoke, durability not quality, need-it-for-work instead of gotta-have-it passion. So why have they ignored the primary niches that serve customers of such qualities like mid-sized sedans, new b-class vehicles, minivans, and the like? They have taken valuable resources to develope vehicle like the HHR which will never sell enough to support vehicles such as the SSR or the Solstace/Sky. When Toyota’s 3 brand’s sales surpases GM’s 8 they will do it on the backs of just a handful of core models that serve the basic vehicle market. Sure Toyota makes some small-movers like the Lexus SC430, but they can afford to venture into a new market because they have a strong foundation.
Some people have posited that the extension can support the core, but it SHOULD never be that way. Brand extensions should leverage brand equity, not fuel it. Atleast not for the biggest 7 or so car companies.
I’m really sorry I sold my Cherokee when I moved to Europe. I would sell my current car to buy oneinn a heartbeat if Chrysler… oh well. It was the original “crossover” and yet the real deal at the same time. If in fact they were selling 120,000 of them when they retired the model, that is truly mind-boggling. The Liberty is not a replacement for the Cherokee no matter what they call it. The Liberty has compact written all over it, down to the short seat bottoms. The old-school angular shape of the Cherokee was very functional for interior room as well. It seems impossible to get the Cherokee back without rounded fenders and modern design cues. I guess reliability hurt their sales more than anything. Something I’ve heard hasn’t changed with the Liberty.
THis just makes GMs decision to drop the H1, no matter how few they sell, rigodamnediculous.
I am kind of mixed on this issue. I’ll talk about Jeep, since I don’t want to pretend I know much about Porsche.
-Car brands and models are now more about prestige and personal identity than anything. Would I have a Jeep of any kind? No. But someone else might. Someone who doesn’t need a trail-rated four wheel drive monster off-road vehicle. And they want something that’s completely enclosed. But they’d like to have a Jeep. So they get a Compass. Now this person can tell everyone that they have a Jeep. I think that’s the people that Jeep is trying to appeal to with this vehicle and the Patriot.
-Are they expanding the brand? Yes. Does this new vehicle suck to purists? Yes. But Jeep is trying to reach a larger audience. Since most purist “core buyers” take care of their cars, how often are they going to come buy a new vehicle? Yes, they’ll come back to the same company, but how often? Every 3-5 years? 5-7? Sure there are exceptions, but you’re trying to draw in new people.
DOUBLECHILLI:
Subaru came into the US market in ’70 with an all new “large” (for Subaru) basic body design that would be eventually used on the 4×4 Wagon in ’77. Through the 80’s you could get front drive boxer engine Subarus. They also tried a funky wedge shaped front drive coupe (another outside-the box gamble ((except it didn’t work)) in the late 80’s.
It wasn’t until the 1990s that Subaru had the idea to make the whole lineup 4×4.
Not only was it not “always about” 4×4 cars, the so called “brand essence” we think of today about Subaru did not exist at all in 1976 – not only that, it was only the wagon and the short lived “brat” that were 4×4 for many years after ’77. The “essence” was actually not there from the beginning – they stumbled onto it by doing just what Robert Farago seems to criticize here: experimentation.
Why can’t we just admit that sometimes carmakers try something new and it works – even comes to represent “core brand identity” and sometimes it sorta kinda comes off fair to middling, and sometimes it bombs?
The T-Bird was nothing more than a Corvette rip-off, yet it kicked the Corvette all around in sales – and even though it was already a roaring success compared to its only important rival, in ’58 Ford “ruined” it with a back seat – then it made so much money in the ’60s it let them play with mid engine toys in France and Italy.
For about 15 years the “core identity” of Chrysler was that they only made big cars (“No ‘junior’ editions!” the ads said proudly) – then they built the intermediate Cordoba (actually called “the first small Chrysler” with subcompact rear legroom, which was antithetical to everything about Chrysler ’till then) and it absolutely killed in the marketplace – there well might not even be a Chrysler without the Cordoba to bouy it in the crisis years of the late ’70s.
Johnny Lieberman:
If the ’84 Cherokee was Jeep’s ‘core idendity’ or epitomized Jeepness, how about the Wagoneer? They literally didn’t change anything but the engine, interior and grille for an astounding 25 years.
In fact the original Jeep Cherokee was the ultimate “ME TOO!” truck. It was a slapdash two door version of the Wagoneer that was ‘ruined’ with tape stripes, wheel flares and white spoke wheels in order to compete with the flashy Blazer and “Macho” tapestripe Ramcharger, which were cleaning the Wagoneer’s clock in sales.
Robert Farago:
In investment, arguably the most important rule to keep in mind is diversification. Haven’t GM and Ford been haraunged, even by you in the past summer for failing to ‘diversify’ their truck reliant product line? It would seem by offering lots of different kinds of vehicles, an auto company would be protected against the fickle fates of fashion as well as financial and political stormy seas
The fact is that cars are a form of fashion and fashion changes.
I understand the mission of TTAC is to, on some level, second guess the decisions of veteran captains of industry. I enjoy doing it myself and love to see others do it. But in this case, I honestly think the entire premise of chaining shareholders, management and labor to a “core brand essence” and stolidly resisting changing tastes is laughably naive.
In the above mentioned case of the ’63 Kaiser Wagoneer, observers were up in arms that Jeep was daring to try to foist a ridiculous concept on a naive public. Original print ads showed a tuxedo-ed man and fur coat-ed woman exiting the Wagoneer in front of an opera house. That was literally 180 degrees away from the rancher/hunter ‘hardcore’ “core brand essence” of Jeep.
What would rich people ever do with a 4×4 when there were plenty of Cadillacs to go around? Why would you market a vehicle that’s supposed to get muddy with a luxury interior that would be ruined by muddy boots? Now even Cadillac is doing the same thing (and making a mint doing it)?
MADNESS I say.
KingE, you say yourself that Subaru came into the US market in 1970, so we’re not dealing with a long history here. And even though they had FWD vehicles mixed in, Subaru offered AWD/4WD non-trucks when that was rare to non-existent. That was their defining identity, hence the big sales in New England and the US Ski Team advertisements. You say they went all AWD in the 90s, and it’s now 2006 and how many other makers have joined them? My point is still valid, but I’ll modify it slightly to meet your objection: Subaru’s identity, since they developed an identity, is as a maker of reliable, affordable, all-wheel drive vehicles. They recently expanded that from all boring vehicles to some awesome performance cars, but they stayed true to their identity. It’s one thing to experiment when you have no strong identity. Once you have one, any deviation risks dilution, period.
BTW, the ’63 Kaiser Wagoneer example you gave was an advertising angle, not a product shift. It was still a 4WD truck, it was just marketed differently.
Boston Tea Party–
You note: The good thing about design is that it won’t be like politics trying to not upset anyone who may vote by saying the wrong thing, design knows people are getting savvy and wanting their own design statement, people are getting more and more design literate these days and especially in the future. I see designs being more unique less bland and at long last more emotional. Something that will be better for the consumer everywhere. There may well be fewer brands, i see fewer major companies, more mergers, but this will make designs stronger.
It would be nice if you’re right. But I’m not sure people are anywhere nearly as design-savvy as you give them credit for, and beauty remains always in the eye of the beholder. And people who are style conscious will still buy whatever is trendy just because it is in vogue.
Just because a desgin is different doesn’t necessarily make it better. (Think Pontiac Aztek, Toyota FJ, or the Jeeplets maligned in this and other threads on TTAC). What makes for a quintescent or timeless design is a whole topic in itself. Some aspects of design are subjective and individual, others are quite objective and have to do with rules of angles, proportions, shapes and sizes that don’t really change all that much over time. They allow for lots of variety, but still can result in generally good design.
KingElvis writes: The T-Bird was nothing more than a Corvette rip-off, yet it kicked the Corvette all around in sales –
The original T-bird was as quintessentially Ford as you could get. All the proper styling cues were there. So of course it “kicked the Corvette all around…”
The T-Bird was nothing more than a Corvette rip-off, yet it kicked the Corvette all around in sales – and even though it was already a roaring success compared to its only important rival, in ‘58 Ford “ruined†it with a back seat – then it made so much money in the ’60s it let them play with mid engine toys in France and Italy.
Those early to mid-’60s T-birds were still pretty quintessentially Ford, and wonderful pieces of styling. I suppose they could be called brand extenders. But they did a damn good job of it. And the growing US economy could support them. Maybe the problem today is that so much of the brand extension is done so badly. And maybe part of it is that some companies, such as GM, have extended their brands so far that they don’t exist anymore. The name, Chevrolet, which meant so much to me in childhood, and still does when I think back on those cars, means nothing today. Same w/ most of the other US cars, and even Chrysler doesn’t mean nearly as much as it did back then.
>>>I understand the mission of TTAC is to, on some level, second guess the decisions of veteran captains of industry. I enjoy doing it myself and love to see others do it. But in this case, I honestly think the entire premise of chaining shareholders, management and labor to a “core brand essence†and stolidly resisting changing tastes is laughably naive.
You can change style while still keeping brand essence. The Big 3 did this in the ’50s and ’60s. The concept Camaro and the concept Nomad are quintessentially Chevy.
In 1955 Chevy ruined its “essence” as a sober, thrifty, economical, but high quality vehicle by offering a flashy, relatively expensive V8 car with air conditioning, power windows and seat.
In 1932 Ford ruined its “essence” as the Model T and A (sounds dirty) maker of super cheap economy cars by offering a stylish V8 car.
In 1935 Buick ruined its “essence” as a “fine car” maker (practically a technical term then, but basically a synonym for a big luxury car) by introducing the relatively small, value priced “Special”
Couldn’t we go on like this forever?
Also, if we have a laundry list of exceptions, the argument becomes so diluted it’s not even worth making.
The T bird example is a perfect instance of a maker going out of its alleged comfort zone (at the time, many within Ford were convinced it was folly) – if the Compass is the example in Jeep’s case – and it just happened to work.
There aren’t too many timeless Bic lighter type iconic cars like the Jeep CJ2a or VW Beatle out there. They are an extremely rare exception to the rule, not the rule.
I have no love for the Compass – I think it’s awful. Similarly, when Willys offered the Jeepster, it was just dumb – all the bad points about a Jeep with no four wheel drive and big white walls – it failed.
But the Wagoneer was another thing altogether. Unlike the pickup and wagon versions of the Jeep (built on a larger chassis than the CJs), it didn’t have the flat, separate fenders and iconic grille. It wasn’t aimed at the regular Jeep audience. Kasier/Jeep called it a station wagon, it was offered as a luxury/4×4, which at the time was a complete oxymoron, and it did great.
doublechili:
If you ask NHTSA and the EPA, they say the Compass is a “light truck” and it’s a 4×4 too; a 4×4 truck ‘like’ the Wagoneer, which is ‘like’ a CJ2a.
Subaru happened on to a new identity, and they could only do it by being willing to experiment and take some risks. The 4×4 wagon of ’77 had nothing to do with the tiny commuter boxes they had been building in Japan.
KingE: You should add that the other significant difference in the original Wagoneer was that it was, I believe, the first SUV marketed in the US with an automatic transmission. That fact alone set it apart from its competition (Land Rover, Land Cruiser, Dodge Town Wagon, Chevy/GMC Suburban, etc.)
Experimentation is good and all, but some manufacturers are going at it like they were in San Francisco, in the late 60’s. The Cayenne is the perfect example of a cynical marketing excercise which ends up squandering the brand’s identity. I don’t care if they were about to be bought out by Lada or something, a company that is known for building some of the best sports cars in the world shouldn’t make the immediate step to selling the complete antithesis of everything they stand for (no matter how fantastic it is at doing just about everything). If Porsche had to expand to make money, the better step would’ve been a sedan of some kind, ideally to take on BMW (if they really wanted to keep up the brand identity, make that sedan rear-engined).
Likewise, the Compass would be an easier pill to swallow if Jeep would at least pretend they gave a damn about how it was offroad.
“The core products get neglected to death: Ford Taurus, Cadillac Fleetwood, Mercedes 190…” What Mercedes 190 are you talking about there? The original way-back-in-the-Stone-Age one, or the more recent one from the 1980’s (and prob’ly early ’90’s)?
‘Coz if it’s the latter one, it’s alive and well. They just changed its name. Hey, where’d ya think the C-Class came from?
Martin Albright:
In ’66 they offered the “Super Wagoneer” which had a 327 and auto standard, along with lots of chrome and faux ‘mag’ wheelcovers, so in some ways, they were even onto the idea of peformance type SUV 30 years ahead of schedule.
Considered a rather large vehicle for the day, it’s funny that the current ‘compact’ Liberty outweighs it.
Final thought: it seems the ‘essence’ defenders are perhaps looking into a rearview mirror and, I daresay, fetishising the past.
I agree with Farago that platform/model proliferation can get WAY out of hand, and that constantly changing names might actually cost more than its worth, but I still believe that if makers get into a ‘rut’ and are always looking backward, they’ll be swallowed up by more dynamic makers.