Bad branding was one of the prominent themes of TTAC’s 2006 Ten Worst Automobiles Today (TWAT) awards. No fewer than four vehicles on the list were derided for their corrosive effect on their brand. Ahead of our ’07 rundown (so to speak), RF has thrown a spear at Lexus’ decision to launch a performance-oriented F-Series sub-brand. The publisher claims a hot shit Lexus derivative is bad branding on wheels. So will a Lexus’ F-Series eventually find a place in TTAC’s Hall of Shame, or is it simply a case of line extension done right?
Some thinkers claim that brand identification is a survival instinct. “Don’t eat the yellow frogs-– you’ll die” has become “Drive a Trabant and you won’t make it to work and your family will starve to death.” In that sense, branding is a learned response that’s passed down through the generations. “Like my pa and his pa before him, I am a Chevy man. Son, urinate on that Tundra.” Taking it a step further, branding can help an individual pass on his or her genes. “Yeah, but he drives a Super Bee!”
Ultimately, branding is so strong because humans need it. The human body, especially the brain, tends toward efficiency. It’s much more efficient to remember a single brand icon– which represents impressions of quality, value and prestige– than keeping track of the thousands of variables that constitute a car. Some might call this intellectual laziness. I disagree. Analyzing every jot of information from the world around us is immobilizing. Utilizing well-developed brand constructs is a frequently reliable shortcut that allows us to think and act quickly.
People get grouchy when companies mess with well-established brand constructs because it disrupts the efficiency of our thinking. We rebel when Ford produces a pickup under the Lincoln moniker because it screws with our notion that Lincoln should make big cushy luxury cars. Brand confusion results when a product is marketed that’s so different from our on-board expectations that it defies logical accommodation. The abominable LT forces us to rethink our inner definition of what “Lincoln” means.
If car buying were coldly logical, everyone would be driving the equivalent of a fleet car. Halo cars work because they strengthen emotional bonds that people develop for vibrant brands. People tend to cheer for the success of brands they love the same way they root for their favorite sports team. They feel vindicated when their team wins and are disgusted when they lose.
Is a “Chevy guy” more likely to buy a Monte Carlo just because Chevy makes the Corvette? Absolutely! Okay, not the Monte Carlo. But they are more likely to stay within the Chevy family if they can’t afford the Vette because they are more likely to believe that the same engineering goodness that goes into the 505hp LS7 engine somehow blessed the lump of iron under their own car’s hood.
But Lexus is a brand without automotive quintessence. It lacks history. Its styling cues hail from images associated with other automaker’s cars. An open cockpit wood-spoked Lexus never raced over grassy lanes through the English countryside. JFK never rode in the back of a Lexus. No revered designers named Enzo or Ferry ever worked for Lexus creating disruptive technology innovations that fundamentally redefined what a car is.
Lexus’ place in the mind of buyers is dependent on its archetype: Mercedes. Lexus is the sensible alternative to German luxury cars for one-third less money, with Toyota reliability. By itself, Lexus doesn’t exist in terms of definitive automotive performance or ride characteristics. So the company can safely extend its line following successful Teutonic templates– as long as it adheres to price point and reliability expectations.
By producing sportier cars, Toyota’s premium brand isn’t experimenting with a F-atal F-oray downmarket. The highway is littered with the bones of companies that made this mistake (Cadillac, Jaguar and even Mercedes). Neither is the circle-L making a play up market into exotic car pricing. Volkswagen illustrated the F-olly of that thinking. While I have not seen pricing on the F-Series, I expect is will be a F-raction of AMG; somewhere safely in the realm of one-half to two-thirds of the price of Stuttgart’s monster-engined luxobarges.
The first generation Lexus SC touring coupe has served as a performance-oriented placeholder in my mind for what kind of car the Lexus brand represents. There is no danger or dishonor in upping the performance level on this or any other Lexus-branded machine, provided it maintains the core values that brought Lexus the success it so richly deserves.
An F-optioned Lexus will be just that: an option. It will not confuse or distract or disappoint the brand’s “core” followers if only because they won’t buy it. In short, the exceptional Supra failed as a Toyota. I welcome its reincarnation as a Lexus.
The F series will dilute the Lexus brand. Just like Coke tried to have too many brands “Diet Coke, Coke Zero, New coke and Classic coke”.
Just because the Germans do it (Mercedes with AMG, Audi with their S series and BMW with their M Series), doesn’t mean Lexus should do it. Lexus have succeeded in creating a superior luxurious car to the Germans complete with total reliability and quality, something which the German fell flat on their faces with. The Lexus brand turned the whole luxury car market on its head and gave the Germans a rocket up their leiderhosen to raise the bar. Even Lexus’ adverts give the image of understated but desirable. If you add loud and fast into the mix, they’re immiscible with Lexus’ current image. Look at most fast cars, BMW M series, Ferarris, Porsches, Lamboghini, etc. Would anyone class these brands as “understated”? Maybe Aston Martin, but the British invented “understatement”! (Ahem!) Anyway, the point is, “loud” and “fast” conjure a whole different image. There are few examples of where fast, luxurious and understated go toegther.
This may be a step too far for Lexus. They should create a new brand purely for performance cars. A whole new brand to take on the super car segement. If the whole adventure goes belly up, then, the Lexus brand won’t be tainted. Can you imagine the damage it would do to the brand? “Lexus. that company that tried to do a performance division and failed!”.
It’s important not to overstretch a brand. Because once it goes pliable, it’s difficult to get in back into shape without a major overhaul. Let Lexus be Lexus…..
Line extensions are ALWAYS a bad idea. Even when they’re not.
In the example above, Coca Cola increased the number of Coke brands exponentially. Market share ended-up slightly down.
Germans???
Kilts???
I must be missing something…
———————————
My major concern with Lexus taking this route is that Toyota has missed more often than it has hit with sports cars lately. The 2nd gen MR2 was fast-ish but too heavy and lacked the tossability of its predecessor. Let’s not even talk about the MR-S… The Supra was great, if a bit loafish compared to its contemporary, the Nissan 300ZX. And the Celica lost its way before Clinton was in the White House.
Now look at Lexus’ attempts at sporty. The original IS300 (nee Altezza) was a valiant effort because it unabashedly copied the BMW 3-series formula. Unfortunately, Infiniti has leapt WAAAAY past Lexus in the pursuit of that icon. The new IS stable is plenty powerful but lacks the communicative feel that a 3-series or G35 has. The GS series are a (bit of a) joke.
I don’t see Lexus effectively taking on BMW in the sportiness category, effectively taking on Merc/AMG in the power category (unless they go to forced induction), or effectively taking on Audi in the… whatever Audi’s niche is… category (AWD? Ergonomics? Crappy electrics? German-ness?)
I could be proven wrong, but I predict Lexus to forever be an also-ran in the sport luxury market.
Some perspective, when Lexus along with Infiniti were launched in the early 90’s it was the LS400 that captured everyone’s imagination. The Q45 was a distant also ran. At that time the IS250 was a disaster on wheels.
Lexus is a North American brand.
When they restyled the LS it ended out looking like an appliance. Wonderful car, very reliable with a loyal customer base, but an appliance.
Same for the ES300, nice car, very reliable, solid service experience, and a gussied up Camry.
The GS line which was supposed to be the performance version with the different look, never did what it was supposed or expected to do.
In the meantime Infiniti for the past few years has been doing a good job with the G35, Lexus is not as successful in this segment. The G35 is doing what the GS should have done a few years prior.
When the LS400 was launched Audi was still in the dumpster in North America. Now Audi has resurfaced if an LS460 is a cool ride, an A8 ia also a cool ride.
The SC which is another wonderful car is in the same company as an XLR, for some reason an SL is still the car to get for that price. One gets the impression that Lexus gave up on the SC.
Lexus needs an halo car to bolster its image, to bolster its brand, to give it some life.
If Cadillac would have persisted a few more years with their LeMans effort, it might be Cadillac and Audi.
Call it what you want, Lexus needs to breathe some life and addtional passion into its brand. Nobody needs a luxury car to go from A to B. A Camry is the ideal appliance to go from A to B.
I’m with WCM on this one.
If Lexus can make their F-series feel special, then we are talking about a sensible brand extension. If however an F feels ordinary, then people in the know will put it down as a cynical money-making excercise.
Somebody said that really advanced technology feels like magic. The “magic effect” is what Apple tries to achieve with their products. (I know, mentioning Apple is groan-inducing).
Perhaps Abarth is a better example. This company used to tune mundane Fiat products and transform them into something that felt magically alive: snarly, agressive, soulful and communicative. The Abarth brand is being re-introduced right now; if they can still turn Fiats into animals then I welcome the brand/brand extension back. If however they just make stiffer-sprung Fiats then their business model is not sustainable.
AGR:
Nobody needs a luxury car to go from A to B.
Where else would they go? Seriously, I think you nailed it: A to B luxury car drivers ARE Lexus. Or, as our Jay Shoemaker said, they’re for people who don’t like to drive.
Why fight/change that?
Lexus’ F series is the natural, obvious and appropriate evolution of the brand. Keep in mind 35 years ago there were no (factory) AMG’s, M series, or RS’s. Mercedes, BMW and Audi all found success in expanding their brand to encompass a full range of upscale clients, including those looking for performance/image. People are intelligent enough to grasp the idea of a premium marque having a reasonable range of vehicles to satisfy those looking for economy (typical Audi A4 buyer in Europe, with a 4 cyl TDI), luxury (an A6 or A8), or all out performance (RS). The same applies to Mercedes and BMW.
What Lexus has succeeded in doing is establishing the brand as a source of super-reliable, well engineered vehicles that includes modest semi-luxury vehicles (ES), hybrids, sport tourers, CUV/SUV’s and all-out luxury sedans. Lexus is much more than the LS, and the brand is now so securely established, it’s ready for further enhancement and expansion.
The profits from the AMG/M/RS type models are huge, and Lexus management would be foolish to not pursue them. Lexus risks loosing custumers with rising incomes who can’t move up the food chain to an F series.
Call me practical (or just too poor growing up), but I never believed in the concept of the halo car for the average buyer. If there’s empirical evidence out there, I’d love to see it.
Realistically, it might work in reverse. It certainly would for me if it’s Toyota. As we all have an eye toward quality, one might conclude (circa 1993) that since the family Camrys and Previas were well built, so too will the Supras and MR2s.
I think that might be the case here with the Lexus.
RF,
The mantra in the automotive business is to increase sales. If its a correct strategy or not is a another discussion, but they all want to increase sales in a saturated North American market.
Lexus sales are doing quite well so far this year, and your argument is why change this combination that generates good results. Especially in the luxury car business, it works well, build good cars, take car of your customers, nurture the brand, and incrementally increase the sales.
Is the Lexus “performance garage” going to appeal to the current Lexus customer, probably not. Will the Lexus “performance garage” appeal to a new customer segment, perhaps.
Will the line extension dilute the brand, or open new venues for the existing brand. If Lexus takes a few of their models and extends them either in the performance or personalisation direction they stand to gain brand awareness, brand recognition.
Should Lexus abide by a proven and well rehersed status quo, or should Lexus be subtlely disruptive with a line extension?
Is F the appropriate nomenclarure, ideally in North America one would want to stay away from F and pick another letter.
I have a slightly different take on this. I think we’re in a phase when a huge number of uninformed consumers seem content with brand extension. Beyond the cars they want the products of partnerships and lifestyle effects, the t-shirts and the caps. The golf club discounts et al.
The numbers overwhelm all sanity. The TV sends the same “lifestyle” messages and when the magazines and newspapers one reads in the barber shop or hotel lobby lend credibility to the money making machines the market gets scewed – just look at the Prius effect with all those singly occupied vehicles now filling the HOV lanes. Look at BMW making SAVs or Coupes on stilts. The consumers only say no when disaster happens or they feel cheated – flipping Explorers or lousy trannies in GMs.
I think the uninformed consumer lving out his or her life in an ultimately quarter-by-quarter low attention span society is accepting of line extension because they have an ill formed understanding of brands in the first place.
If the F is ok’ish people will buy it and then swear that it defines the segment. Those in the know will despair. Legacy and marque value seem to me at its lowest ebb.
P.
Owner of BMW 3 (I like bends) and Lexus RX (driven by my wife – i hate being that high up)
Looking at it as a consumer…
I really liked the second-gen Lexus LS400, while simultaneously recognizing it as not exactly my kind of car. It was rationally sized, scrupulously detailed, reasonably economical, and effortless to drive. It was, in short, a reasonable alternative to the Teutonic duo.
Lexus’s subsequent efforts have really seemed to wander — the dowdy SC430, the overweight LS430, and the thoroughly ponderous LS460 (which seems like a Japanese reincarnation of the mid-90s Benz S-class in all the wrong ways). The first IS flailed in the general direction of the 3-series and missed. I remain unsure at whom the GS is aimed (except at people who want an LS, but can’t go quite so high on price). It seems like they’re trying to be all things to all people, and thus ending up as none of them — I can’t think of any of their cars I’d buy if I had the money.
I like the looks of the current IS; I think it’s very sharp, and definitely superior in styling to the current 3-series or new C-class. Unfortunately, it has nothing to back the racy looks — it’s too heavy for the base engine, it’s laden down with heavy-handed electronics that I don’t want, and it’s not any good to drive. It’s hopelessly compromised by the demands of the sport-luxury sedan class and the imperatives of the Lexus brand.
The F does not help the cause. The F has more power, but is even heavier and less efficient. It will cost a whopping amount more, I have no doubt, pushing it past the point I would consider spending on a car like that. It may or may not be any better to drive.
Rather than build a enjoyable ‘near-luxury’ sport sedan, the F strikes me as a belt-and-braces attempt to rectify the flaws of the basic concept. It reminds me of the mid-80s Buick turbos — nice engine, shame about the car, and what was a Buick, again? I look to Lexus/Toyota for rationalism, and it is notably absent.
The result is that if I’m shopping in that category I’m more likely to end up with an Acura TSX, not because it’s faster or even prettier, but because it just seems to make more sense.
It will all depend on how good the F series cars are. Let’s imagine the cars turn out to be legitimate BMW M killers. The best performance sedans in years. What then? Will anyone care about brand? No, they queue up for miles to get one. End of story. It’s only if they suck, or are mediocre that we’ll be able to discuss brand dilution, brand evolution, magic-making and such.
So if Toyota wanted to make an upscale performance car what should they do? Should they create another division?
Brand extension is not evil or bad. Successful brand extension are the sign of a healthy, well maintained brand – one that isn’t so narrow and recalcitrant that the public cannot even accept logical and prudent improvements and diversifications.
The public rebelled against New Coke failed because when it was rolled out, because the company took away the original formula Coke at the same time.
Coke Zero is failing because it sucks.
Neither product failed because as a result of brand line extension, per se. Furthermore, the Coke brand has survived and remains strong.
Without brand extension, Diet Coke wouldn’t exist. Hundreds of millions of people would agree that Diet Coke is a good thing.
I have a confession to make! At the beginning, I did write my opinion (Very first post) as a joke rebuttal just to tease everyone! ;O) But the more I wrote the more I thought “You know what? There could be a basis for an argument, here!”.
Lexus DO have a valuable brand built through organic growth and hard work and, more amazingly, built in such little time (20 years!). So it’d be such a shame to see that brand diluted and stand for nothing (SAAB, anyone?). But then another thought occurred to me, we the patrons at TTAC, are at fault.
Think about it, we’re so used to disappointment in the car industry (Detroit showing utter ineptitude, market cars which bear no relation to the concept version, cars which are loved, consigned to the history books by some MBA, new technologies panned because it may force other manufacturers to re-evaluate their powertrains (hybrids vs diesels vs petrol), car makers crying about a “perception gap” but doing nothing to kill it, big corporations crushing the life out of quirky brands, etc) that when someone like Toyota/Lexus want to expand their brand, we treat it with derision and call it a bad idea, forgetting one crucial fact.
Toyota/Lexus have rarely, if at all, put a foot wrong. Everytime they enter a new market, they do their research well, study the competitors’ products, wonder how they can improve them and work out a way to make the product profitable without compromising their industry leading quality and reliability. And if they do make a mistake, they don’t whine about it like a bunch of girls and blame extraneous forces (i.e housing market, artificially weak currencies) they go back to the drawing board and work out where they went wrong.
We’ve become so cynical here that can’t give Toyota/Lexus the notion that they may pull it off.
So really there were 2 points to that fake post.
1. to see the other side
and
2. to show how cynical we’ve become.
But I still love TTAC! Go TTAC! Woo hoo! ;O)
And without brand extension, Ford would never have introduced the Mustang and Honda would not be making cars.
Is F the appropriate nomenclarure, ideally in North America one would want to stay away from F and pick another letter.
Because of the associations with failing grades and unlawful carnal knowledge?
Bah, this concern is overrated. Having an F-Seriese hasn’t hurt Ford any in the North American market.
They should have put the sporty cars as Toyotas, a brand which has some of the heritage (2000GT, MR2, Supra). The first IS would have done so much better $5000 cheaper, a bit less leather, and called a Toyota. The current IS is beautiful, but too soft to be competitive.
People want their soft, floaty Lexus cars, my dad loves them although I feel nauseatingly carsick in them. Not everyone has to make a luxury sports sedan, it is okay to just make a luxury sedan and not compromise. The LS460 is ridiculously well-made and I believe superior to the S-class, but not as sporty, so driving enthusiasts will never care for it (although why an enthusiast would ever buy an S-class over a Maserati QP is a mystery).
Toyota should focus on these things:
1. A new AE86 under the Scion brand. Drop the Scion tC and the Celica from the lineup. Lots of aftermarket TRD parts.
2. A roadster based on the same platform right in between the 350Z and Miata.
3. The IS needs a bit more tuning and aggression. Use the F-branding (although I preferred L-tuned)
4. A new Toyota Supra/2000GT successor. After fixing the IS, use its RWD platform for a FR coupe and but it right inbetween the 350Z and the upcoming GT-R.
5. A new SC is needed. That category is pretty weak with the 6-series being ugly, the new XK being outdated and the SL being expensive. Use the new Supra platform, add a retracting hardtop and just soften it slightly. Give it IS styling instead of the beached whale style of the current one.
Brand extension is not evil or bad. Successful brand extension are the sign of a healthy, well maintained brand – one that isn’t so narrow and recalcitrant that the public cannot even accept logical and prudent improvements and diversifications.
Agreed. If brand extension was such a bad thing, then Toyota would be limiting its offerings to Corollas and Coronas. Fortunately for TMC, it knew better, and has extended its brand quite nicely to become a full-line automaker.
If anything, GM should serve as a cautionary tale for the hazards of excessive branding. The Sloan progressive branding strategy made sense back in the 30’s when automakers carried limited product lines and it was possible to differentiate fairly easily by making a few relatively minor tweaks. But as automakers evolved to become full-line producers, the brands were bound to overlap, and by the 70’s were already well on the path to becoming obsolete.
Again, there’s no branding conflict whatsoever. Lexus’ brand can be distilled into two words: Dependable luxury. If the cars are dependable and luxurious, then they will support the brand; if they lack in one or both categories, then they will compromise it and should be avoided.
The benefits of the halo come from the opportunities provided for product positioning (having a few tiers of each vehicle nameplate, as not one size fits all) and because the performance/power product will feed the zeal of “evangelist” fanboy tastemakers who will help to spread the gospel to the undecided.
If the halo was so ineffectual, why do the successful automakers such as BMW all employ this strategy? I can’t honestly believe that they’re all idiots and haven’t given this some thought. After all, they do it for a living, and they do it well.
Point of order:
A “brand extension” is not the same as a model or product extension.
For example, Porsche can sell any number of sports cars without extending its brand. Ford can sell any number of economy cars and not extend its brand.
The Cayenne is a brand extension. The Ford GT is a brand extension. The Lexus F-Series is a brand extension.
Every Toyota enthusiast in the world wants a Toyota Supra to come out even if they are in no position to buy one. No one is waiting for a Lexus F-Mseriesamgblack. Why is the hell would they go ahead with this? Is there a Lexus F1 team? Lexus ever win anyWRC Championships? If Toyota has any of their hard won credibility in sports car left, it’s under the Toyota badge, not the SUV your pampered wife drives to work badge.
I get the sense here that the folks who are resisting the concept of the F-series are the ones who are loathe to see Lexus as anything but safe, reliable, and boring transportation. The fact of the matter is, though, Lexus *has* this great quality control and reliability *already*. Anything else it chooses to build into its cars (be it sport, power, etc.) is value *added*.
Just as Jaguar has tried to go from frumpy to more youthful and energetic with its designs and performance, Lexus has nothing to lose from cranking up the fun-to-drive quotient. Citizen Driver still has his normal Lexus, and he can still be King in the LS460h. Meanwhile, the prudent sport driver will have to start thinking twice before committing to the hassles of German auto maintenance.
As products that will obviously be produced in smaller quantities than the main line, the F-series will remain a niche in the near term. As a customer, though, I can only see good things coming from the technology trickle-down and the experience in vehicle handling dynamics the F-series will provide…
A “brand extension” is not the same as a model or product extension.
If the Lexus brand can be distilled as Dependable Luxury, then how would building another dependable luxury car possibly harm the brand?
I would emphasize that Lexus needs to build highly reliable cars on a consistent basis. Their last barrier to dominance in the US market is the lack of sex appeal of its vehicles, that intangible in-the-seat feeling that makes driving a BMW more fun than driving a Buick.
If the cars do that, then it actually enhances the brand, because it shows them to be more capable than they are today. If the halo car is outstanding, then it provides more prestige and assurances that the lesser ones are, too.
Whoa – Lexus isn’t great at everything is currently does.
The Lexus ES is not “great”.
…and as pointed out in the podcast, Lexus may struggle to produce a reliable high performance car. It’s not easy.
KatiePuckrik, you are the devil’s advocate!
What happened to the IS coupe and convertible?
I thought Lexus was comitted to pacing the 3-series with the IS line?
Bad Branding: If Lexus introduces a less expensive hot-rod boy-racer in an attempt to attract a young F-ast and F-urious demographic. The change is too far away from its Luxury core value.
Good Branding: If Lexus mimics Mercedes AMG, the same way they mimicked Merc’s luxo-barges, by doing it for less money and with greater reliability. This is a logical extension of its Budget Luxury core values.
I still think a “red badge” Lexus is a bad idea. Is it a dependable luxury car, or a dependable luxury performance car? It’s both. Ok, that’s a clear consistant message.
Will my standard Lexus ride harshly the way performance cars do? Am I buying a dependable luxury sport sedan, or a dependable luxury barge? I’m already confused and uncertain, and the F isn’t even here yet.
To me, Lexus is what Cadillac would be if Caddy had learned how to make dependable cars. It’s a soft ride, boulevard cruiser. It’s a luxury appliance. Bringing performance into the picture just muddies the immage. I don’t expect a Lexus to outrun a Corvette, or a Mustang, or a SRT8 Super Bee. So what happens when I plunk down the extra cash for the “red badge” version (throwing in a bit of Bently history here) and I get my *ss kicked by an F-ing Dodge?
I agree with RF. Lexus needs to stick to it’s knitting.
I have stated before that I feel MB has significantly deminished the cache and value of the AMG name by putting the badge on just about everything for sale in a MB dealership today. To me the breaking point came when MB had the gaul to market such silly vehicles as the G55, ML55, RL63. Once these vehicles came to market I lost all faith in AMG. It is apparent that AMG is nothing more than a marketing tool for the current exec at MB.
Today AMG is simply nothing more than a corporate engine and some suspension bits that MB liberally installs across the line. The C63 get the same engine as the S63, which in turn makes the s63 less special (so what it make a few more horses in the S). OK, MB does install a body kit of questionable appeal.
AMG used to be the MB equivalent of Alpina for BMW.
The mission of AMG today is so far from its roots that for the people that have followed AMG products since the 1970s the new cars are sorry poser jokes that appear to be marketed at the same type of uninformed driver that will buy a Lexus (if it is the fashion statement of the day).
My point is a AMG Hammer onthe late 80s was as exotic as a Contach on the street. An E63 today is just that an E63, you dont give it a second look. To make matter worse MB will sell you an AMG look-a-like for each “real” AMG product they offer.
What is ironic is that the cache value of the entire Benz line is less than it was 10 years ago before AMG became an “in-house” division of AMG. MB today reminds me of the waning superstar that is losing his edge and is trying to hide that fact behind a bunch of flashy trash (you gotta love all those glued-on chome pieces) .
BMW on the other hand has maintained a more serious and focused approach to their M-line. You have your choice of an M3, M5, or M6. As it has been for the last 20 years. I respect BMW for NOT marketing an M7. Their reasoning being that a car of this sized doe snot fit in with the M mission.
Unlike MB BMW has continuiously maintained a very good relationship with it factory approved independent tuner house, Alpina while build-up its own M-line. In Europe at least this had lead to a health level of friendly competition between Aplina and the factory M series cars. this synergy has benefitted both BMW and Alpina.
Wow, Robert I think I might be getting your point here! MB, IMO has been headed down hill since it has embraced “performance” over high quality. While they have been attempting to move into BMW feeding pen they have not hurt BMW one bit but have done enormous damage to their own brand. BMW has continued to grow even with a performance oriented MB invading their tradional territory.
Lexus on the other hand has invaded MB turf, successfully established a beachhead and is moving inland at a rapid pace. Lexus is benefitting big time from MB’s major mistakes of lately. They are doing great today and like MB 15 years ago NO ONE IS ASKING FOR A PERFORMANCE SUB-BRAND from Lexus. Now I guess you can tell by my previous post that I am a Lexus fan, but Robert might right on point here for a number of reason;
1. The first product the IS-F is downright ugly! The looks might be a major turn-off for the current Lexus crowd myself included.
2. Folks ahve been asking Lexus for better suspension tuning for a number of years now. Lexus has yet to deliver on this, but are ready to push ahead with a full out performance sub-brand????? Maybe Lexus should start by offering a decent sport susupension package that will prove to the skeptics that Toyota/Lexus has the goods.
3. As mentioned before Lexus has not achived its goals with the new IS in its quest to be a true BMW 3 series fighter. Infiniti has done much better with the G35 and is getting all the press. The IS is nice but it the world of auto-enthuseist it is honestly just an also ran. While I like the GS model I would only consider it price and AWD.
It is possible that Toyota/ Lexus might do better to leverage TRD to create some hand built specially tuned Lexuses to sell at a permium. After giving this whole arguement some deeper thought I am realizing the problem for Toyota is they have to overcome their 12 years of neglecting performance vehicles. With all the money they have made had they smartly invested some big buck into TRD over this time the future might be a buit clearer for them.
Tankdog:
Whether Lexus or not has any racing heritage is really an irrelevant point since the Lexus badge is exclusive to the North American market and everywhere else in the world those IS’, ES’ and LS’ vehicles are sold under the Toyota nameplate. It should be noted, however, that Lexus does race in the Grand American Road Racing Series (sanctioning body behind the 24 Hours of Daytona endurance race) in the Daytona Prototype category, where they have been highly competitive since its inception in 2003.
Going by your logic, though, one would say that it’s folly for Acura to build vehicles like the NSX and Integra Type R since Acura’s racing heritage is no better than what Lexus has.
RF,
I like this guy’s argument. I will have to side with Monty, and (gasp) PCH101 (film at 11).
As for Katy being the Devil’s Advocate, she may be. However, anyone who uses the phrase “just corky”, can’t be all bad!
quasimondo :
Actually Acura is a North American only name plate too, the NSX and Inegra is a Honda everywhere else. And those in the know buy honda badges for their NSX, because Acura is lame. The only thing more pathetic than the two of them is Inifinity. All three badges were invented to bilk north americans out of more money for more useless options that make the cars slower.
jeez, i think this is being overanalyzed to the point of beating the poor thing to death. Paul Niedermeyer has it right; and in fact it’s very simple. If lexus produces a superb sports car that competes well with 911s and M3s, or whatever its target is, and it’s reliable and beautifully crafted people will buy it and toyota will make money. that’s all they are trying to do, nothing mysterious about it.
Anybody who sticks a Honda badge on an Acura is a JDM fanboy. Let’s not kid ourselves.
How about everywhere in the world but hereDM fanboy? If you have an Acura branded NSX, everyone knows you paid too much for it, regardless of what country you are driving it in.
The only people I know that buy Lexuses (Lexi?) at all do so because the Toyota dealer experience is horrific, why can’t Toyota apply a little of that Lexus dealer cream to the Toyota line dealers?
What? First of all, it’s not like you can choose to buy an Acura branded NSX or a Honda version in North America.
Secondly, you don’t get a rebate for swapping the badge on an NSX. Whatever you paid for it is whatever you paid for it, doesn’t matter if it says Acura or Honda.
Lastly, I’d wager that almost every single NSX buyer (they sell like what, 1900 NSX’s a year or something?) knows that it’s a Honda everywhere else in the world. It’s not like there are special people “in the know.” It’s common knowledge. And I’ve never seen a Honda badged NSX in North America. (Granted, I’ve only seen like a dozen of them in my lifetime.)
Lexus is not a North America-only brand. It had trouble making a lot of headway in class-conscious Britain, and there was the embarrassing spectacle a few years ago of the UK entity suing gray-market importers for slapping Lexus badges on RHD Toyotas imported from Japan — charging them, ironically enough, with fraud.
Is this performance F-sub brand strictly in the US market or everywhere Lexus’ are sold worldwide? I keep wondering as I start to think Robert might be right that this may have little to do with the US market. Isn’t Lexus having trouble growing market share in Europe? The place where the German performance/luxury brands call home. They may be trying to go after Europeans and the US is just the logical place to sell more of those cars at.
I think brand extensions like this can be pulled off but I don’t think Lexus can do it. If it’s a whole new staff designing/tuning these new models maybe but if they just shifted some troops to the new brand they are DOA. It’s like they have lost all the sportiness they once had. Did a lot of engineering & designers leave or die? The ones that brought us the MR2’s, Supra’s, Celica GT4’s and maybe more but my brain is mush right now.
If they did pull off a good M fighter I would actually start considering the brand, well when I could afford it in the future. Right now I have no used for a gold plated toaster on wheels. But a silver plated go-cart I might.
A few corrections: Lexus is NOT North-American only brand. Lexus has now become a worldwide brand. The Lexus brand is sold in over 50 countries around the world today. The F-Series sub-brand will be worldwide just like the Lexus brand already is. It makes absolutely no sense to make the F-Series North American only. Lastly, the Supra never “failed” as a Toyota. The Supra is a legendary car within automotive history and to this day continues to be a legend. It may have “failed” at generating high sales, but that’s about the only thing it failed at. Also, the upcoming Lexus sports/super car will NOT be a “next-gen Supra” as some of you may be thinking. Toyota does have a sports car coming to the Toyota brand, which will be different than the Lexus car.
Pistonheads want to see a purpose behind a marque more than anything. That’s why they don’t like brand diluting. The majority however doesn’t feel that way.
Today there are basically two kinds of people. On the one hand there are those who see cars merely as a means of transportation. They can’t see any fun behind the wheel and they don’t care what other people think about their ride. Their car has to be practical for whatever purpose they have in mind and it has to be economical (read CHEAP) and that’s it.
On the other hand there are those who care about their ride for whatever reason (e.g. they love sports cars, want to brag about how much money they’ve got…) These people don’t want an “average” car but something special.
Both of those groups for the most part don’t care much about some obscure purpose behind a brand. They either want a car that’s as cheap as possible, or one that ensures them some sort of status. So what both of those groups need, is a manufacturer that serves their needs (cheap or status) and has a full line-up.
You know like “Hyundai has the image of being cheap and reliable and since I don’t care about the rest, I just always buy Hyundai, the daily commuter as well as the SUV for hauling the kids.”
Or “BMW has the image of being sporty and luxorious and since I don’t care about the rest, I just always buy BMW, the daily commuter as well as the SUV for hauling my boat.”
That’s why Porsche can sell SUV’s and why Hyundai can sell “luxury” sedans.
That’s not very romantic, but it’s the truth, and that’s also why I think that the Lexus F won’t hurt the company, in fact it’ll probably be an economical success. I still think that it’s a stupid idea, but I tend to be too romantic (when it comes to cars anyway).
Lexus is boring. Right now, the only reason to buy one is because you want to know your car will start in the morning. In fact, as a random poll, do any of our commenters own a Lexus as their daily driver?
Right now, a Lexus is a leather-lined Toyota – dull but dependable. As long as Lexus keeps the difference between the F-cars and the regular lineup clear, it’s expansion, not dilution.
Qusus :
In Canada you can buy a JDM Honda NSX, albeit a 15 year old one, since they never changed one bit in 15 years that’s not really an issue. I only know two people who own Acura branded NSXs, they both work for Honda, and have rebadged the cars inside and out as Hondas because even people at Acura know they aren’t Acura’s. $130,000 for a mid engine Accord. I hope Toyota doesn’t pull anything so rediculous. I have never seen a Lexus in the hands of someone who didn’t have a silver head of hair. Then again I could say the same about most generations of Corvette.
The GS400, IS300, and SC430 are really rebadged Toyotas *gasp*
And the G35 and M45 are really rebadged Nissans *double gasp*
I hope you can restrain yourself from letting those silver haired people in on this dirty little secret. I don’t think their hearts can take the shock of finding out they’re driving a $65K Toyota.
Ack! Nobody gets it. Still. All the F-lovers are right, Lexus will make a snappy car and it’ll go fast and sell well and be pretty. Great! That doesn’t matter, however.
Even if the F-series offerings give everyone cargasms, the problem here is that this is not a cars issue, this is a BRANDING issue. If Lexus wants to solidly occupy the mindspace of wealthy consumers as the automaker that provides unparalleled ride comfort, luxury, and reliability, then they should stay on track. They’ve been doing great. Any extensions should just be done upward in the same vein, maybe a new super-duper luxury sedan with a $100k base price tag.
Great branding is the ability not to give the masses what they might be clamoring for. Great branding is declining easy profits for the sake of mindspace and perfecting your established craft. This is an unmitigated mistake that will introduce some pliability, as KatiePuckrick stated.
It doesn’t matter if these are the greatest things ever to put rubber to asphalt, the ideal thing for Lexus to do here would be to create a new performance brand and market it separately and keep it as strong as Lexus has been to this point. No re-badges; a unique sporting brand. And don’t make a “GM has too many brands and look at them” comparison because GM’s problem is that they lost brand identity with too much cross-platforming and easy money-chasing.
No harm no foul? Hardly. The harm will not be realized until viewed from a much larger perspective than even a 10-year timeframe. Branding is a 100-year craft, and the F series decision doesn’t stand up.
From Inside Line a write up and photos of the 2008 IS-F Click Here.
Even if the F-series offerings give everyone cargasms, the problem here is that this is not a cars issue, this is a BRANDING issue.
It’s a branding benefit, because it shores up the weaknesses of the existing brand.
Again, Lexus’ real downfall is that despite the high price tag and solid reputation, it is still perceived as lacking cachet, which will compromise its ability to compete with other luxury marques unless and until it is addressed. That lack of cachet is a weakness that should be fixed, and gaining more of it is precisely the path that a luxury brand should take.
I have seen no cogent arguments that show specialized badges such as the M-class BMW’s as having any corrosive effect. If anything, they help with product positioning by casting a positive glow onto the more mainstream versions of the products.
The basic argument here seems to be: Lexus is perceived as boring, and they should keep it that way. I would say that enthusiasts, as usual, are misguided vis-a-vis their views on marketing — they assume that the entire marketplace should be viewed in enthusiast terms, when gearheads are just a small niche of the total market.
Americans don’t like Lexi because they are dull, but because they are reliable. If they can become both reliable and interesting, with cachet value to boot, then their sales will mushroom and BMW et. al. had better seriously figure out they will do next as Toyota does to them what it has already been doing to the US domestics.
BMW M-series comparisons are slightly misguided, because BMW’s have always been “driver’s cars”, and the M-series enforces that with Germanic grunt. I wouldn’t say M-series is corrosive but rather reinforces BMW’s already enthusiast-oriented reputation.
Lexus’ reputation will not be enhanced by the F series as BMW’s is by the M series, as the F cars will introduce an entirely new facet to the brand that will change it and force it to occupy mindspace already cluttered with AMG and M etc and change consumers’ understanding of the brand. I come to this conclusion not as an automotive enthusiast but as a branding and marketing enthusiast – this will only serve to muddle the brand.
Lexus OWNS the reliable luxury mindspace, it’s like Kleenex and facial tissue in that regard. This venture will not strengthen the brand as it will take them into entirely new territory, and will force them to compromise on their branding efforts as they accommodate two distinctly different brand personas – Investment Banker Snoot and Enthusiast Snort. They might pull it off gracefully and profitably, as Coca-Cola did with Diet Coke, but the objective conclusion is that both Coke and Lexus would be stronger brands without these excursions into easy profits.
Not all brand extensions are necessarily corrosive, but this one has to be because it is radically different from the identity Lexus has relentlessly built over the last 20 years.
I can’t believe GM! They’re still making cars that suck and still insist on blaming their misfortunes on extraneous forces! I mean, how is it difficult to…..
Hang on, are we still talking about this Lexus thing?!
;O)
Not all brand extensions are necessarily corrosive, but this one has to be because it is radically different from the identity Lexus has relentlessly built over the last 20 years.
That’s the point of my previous post: It isn’t radically different at all. That’s the perception of uber-gearheads who are predisposed to disliking Lexus, not the view of the mass market.
Again, you believe that the Lexus brand embraces boredom as a virtue. It’s pretty clear that while the boredom is palpable, it is detrimental to the brand. It’s the reliability that generates the sales, the boredom is just unfortunate baggage that comes from Toyota’s lack of Teutonic suspension talent.
That boredom you claim that the market embraces is the very same thing that is holding it back from utter dominance of the luxury segment, because the boring factor and the lack of cachet run hand-in-hand.
The marketplace has not demanded boredom from Lexus. That dullness is simply a design flaw that Toyota has had trouble shaking, an Achilles heel of its engineering talent that is not deliberate. If the new class signifies its ability to become more German in attitude while maintain Lexusota reliability, then this will be the path to a home run. In that case, there should be a lot of nervous Germans trying to figure out how to respond.
Lexus does not embrace boredom – that is the assessment of enthusiasts. A Lexus is not a driving enthusiast’s car, it is a car for those who appreciate the finer things, soft leather, luxurious design, an isolating ride. The things that make being stuck in traffic on your way to the yacht club tolerable. None of these things are a detriment, they are exactly why I would love to own a Lexus as a daily driver. They are also what makes a Lexus a Lexus.
Lexus doesn’t need to poach BMW or Mercedes customers any more by mimicking the German brands because it’s done such a damn fine job of making it’s own! They don’t need to play catch-up anymore because they’re setting the bar. That’s part of the problem of this extension – it belies a certain insecurity that is unbecoming such an austere and respected brand.
Lexus is not boring; their perception as such from enthusiasts is hardly a mistake. They are literally the Toyota of luxury cars, which might draw derision from the pedal-to-the-metal crowd but accolades from the masses. Comfort, security, indulgent luxury – this is Lexus’ territory. Let the Germans scramble to improve reliability and battle each other for the pistonheads, Lexus should be through with chasing the krauts.
Pch101,
You are making conpelling arguments as to why Lexus should have a line extension.
From your arguments and looking at the photos of the IS-F this car would bring a different segment of people to a Lexus showroom.
Audi in Canada is doing a “road show” from Newfoundland to British Columbia it started this week, with their S lines and R8’s invited people have an opportunity to drive the various models. Clearly if an S4 is too much $$, and A4 might work.
Lexus doesn’t need to poach BMW or Mercedes customers any more by mimicking the German brands because it’s done such a damn fine job of making it’s own!
That’s inaccurate. Except for a few enthusiasts and diehards who are married to their specific brand choices, buyers do cross-shop these cars and they compete directly with one another.
As a “fast follower,” Lexus clearly benchmarks German models and branding attributes in its positioning efforts. The IS is clearly an effort to target the 3-series, this is no secret.
Just as there is an M3, there is no reason not to have an IS-F. If anything, it’s part of the fast following ethic to copy at that level, too. Two or three standard engine choices + a hot ubermodel is the standard positioning configuration for German models in the US market, and Lexus is copying that to a “T”.
Pch101:
My riposte: Humbug.
It appears we disagree forever and ever. I shouldn’t have said Lexus doesn’t need to poach customers, I should have said mindspace. You are absolutely correct in saying cross-shopping takes place, and Lexus does need to poach customers – I just think they can do it by making a unique brand proposition. Lexus already makes a compelling enough case with it’s known and respected brand attributes and the F series will only cause the brand to lose it’s tight focus, which is what branding diehards are all about. It would be better for them to enforce and increase their much-beloved brand attributes than to go chasing M-series and AMGs.
From a purely branding perspective, I maintain that this is a mistake, but from a business perspective it is probably smart. Seeing as the two cannot be divorced, we now have a delightful controversy to distract me from my dolorous job.
Keepin’ the flame,
Jake
kazoomaloo, you still (along with RF and others) don’t get one BIG point about the F cars: they will STILL be a Lexus!!!
This is a FACT that has been said multiples times by Lexus themselves. The F sub-brand cars will STILL have the ride comfort, reliability, and luxury that Lexus is known for. But compared with a regular Lexus, the F-cars will ADD more performance, more sport, and a more visceral and raw driving experience on top of the well-established criteria that Lexus is known for.
This is why the F sub-brand will NOT harm the Lexus brand or it’s reputation, it will only reinforce and enhance it.
If you were to take away the performance and sport-minded aspects of the IS-F, you would STILL be left with a Lexus. With the IS-F, you can still get leather, or the 14 speaker Mark Levinson sound system, or any other luxury features and options that you can get on a regular Lexus.
It would be silly to make a COMPLETELY new brand just for a few performance-oriented Lexus models. THAT would dilute the Lexus brand since under the supposed new brand the Lexus F-cars would STILL obviously look like a Lexus, and that would confuse people as to why exactly the new brand even exists.
The F-cars are not a typical Lexus, so Toyota decided to make a sub-brand. Fundamentally, the F-cars are STILL a Lexus, so that is why it’s not a complete new brand, neither is it a regular Lexus. It’s in the middle, which is a sub-brand.
The reason there is cross-shopping between Lexus and German brands, and the reason Lexus is eating a large portion of the German’s lunch, is that the Germans are selling to two different markets under a single brand name, or a brand extension.
The two markets are sporty/luxury and classic/luxury, both overlayed with a desire for snob appeal. Sporty luxury buyers want to talk about suspensions and manual transmissions, 0-60 times, etc. They care how many g’s the car can pull on the skidpad test. They may rarely, if ever, drive the car to it’s full potential, but they like people to think they (can) drive that way.
Classic luxury is a big floaty boaty leather lined isolation chamber on wheels. The buyers in this market don’t car about suspension tuning and aren’t really all that sure what a suspension is. They want leather, and wood, and power things that go whirrrrr in the night. These buyers do not want AMG/M type performance. (If they did, they wouldn’t have bought Lexus in the first place) They want Fleetwood performance. They buy from Lexus, rather than the Germans, because Lexus is a no hassle ownership experience.
I would guess the number of Lexus owners hoping and praying for a performance version is only slightly larger than the number of Ferrari owners hoping and praying for a pickup truck version. If these people were interested in driver’s cars, they wouldn’t be Lexus customers to begin with.
Lexus is only eating the Germans lunch because the Germans were eating Cadillac’s lunch. (Lincoln/Chrysler isn’t even worth discussion) Caddy has steadily moved downmarket so there isn’t much snob appeal, and of course GM’s quality simply isn’t comparable – or wasn’t for a long time. People moved to the Germans to get back upmarket – where Caddy should have stayed, and to get better quality. (Boy, American cars must really have been bad if people were looking to the Germans for quality) Lexus is simply what Cadillac would be, had Cadillac maintained a brand identity, and had the ability to make reliable cars.
The reason this F thing is a bad idea is that Lexus is currently selling to the Classic/Luxury market. Sporty/Luxury is a different market, and just because the Germans don’t understand that is no reason to follow along.
Lexus is only eating the Germans lunch because the Germans were eating Cadillac’s lunch. (Lincoln/Chrysler isn’t even worth discussion) Caddy has steadily moved downmarket so there isn’t much snob appeal, and of course GM’s quality simply isn’t comparable – or wasn’t for a long time.
I honestly don’t see this at all. Looking back at history, I’d opine that VW and the British roadsters help to create a niche for people who prioritized nimbleness and simplicity, which in turned paved the way for the Japanese to bundle those virtues into fuel efficient cars during the 1970’s fuel crisis, which found Detroit caught with its pants down. As that demographic aged, they took those acquired tastes for foreign metal to buy updated offerings from the Germans and Japanese. As the Japanese lacked upmarket offerings until the late 1980’s/early 1990’s, the Germans had a lot of lead time with which to carve out the upper end of that niche for themselves.
The problem faced by the domestics is that their demographic aged and that they never created credible product to meet the changing tastes of the market, particularly the young buyers who were now open to choosing imported brands without any stigma. Now that the Japanese and Germans own those spaces, they are the only ones left (along with the Koreans) to fight over them. Cadillac et. al. have not been a factor in this segment for a very long time.
It would be silly to make a COMPLETELY new brand just for a few performance-oriented Lexus models.
Not to mention extraordinarily expensive to launch a brand from scratch, even if it were closely affiliated with existing Lexus dealerships. It’s much less expensive to market a sub-brand.
“Not to mention extraordinarily expensive to launch a brand from scratch, even if it were closely affiliated with existing Lexus dealerships. It’s much less expensive to market a sub-brand.”
I keep asking why then did Toyota go to all the expense of creating the Lexus brand. Why didn’t they just offer luxury option packages on Toyota models?
I keep asking why then did Toyota go to all the expense of creating the Lexus brand. Why didn’t they just offer luxury option packages on Toyota models?
With the US auto market tiered into three basic levels (mainstream, luxury, exotic), it’s not really possible for a mainstream brand to sell into the luxury space, while a luxury brand denigrates itself if it sells downward into the mainstream.
Toyota did not have the brand equity to sell luxury cars to Americans, the separate brand was critical to its success.
If criticism is going to be directed toward anyone, it should be saved for Acura, which muddied the dividing line between luxury and mainstream by keeping the Integra/ RSX, and by making the RL not worthy of its 5-series-level slot. Lexus branding is in a lot better shape that that, it is surely the strongest of the three Japanese luxury marques.
When Cadillacs and Lincolns stopped evolving and improving in the early 70’s is when the German cars started their inexorable climb. The M-B 450SEL of the mid seventies is the car that started winning people over from the domestics.
By the early 80’s it was an exodus from domestics to German cars by the folks that had the finances to do it.
By the late 80’s Lexus came along to do to the Germans what they had done to the domestics 10 years prior.
If you have 100K for a car do you put it an S550 – LS460 – 750 – A8?
For sport sedans (entry level luxury) it used to be 3 Series then the M-B 190 came along, then the Volvo 850 – then Audi started reviving – the Japanese struggled for a while – out of the blue Nissan gets very disruptive with the G35, the CTS is making its presence felt – the Lexus IS is also making its presence felt.
Entry level luxury is a busy market segment, and the “performance garage” is an intrinsic part of that segment as dynamic88 descrbed it a few posts back.
If Lexus wants to be a player in entry level luxury they need a “hot rod” to be considered a real player in that segment by the prospective customers of that segment.
Today’s German cars with V8’s sound like yesterday’s domestics with V8’s and dual exhaust.The prospective customers go crazy for a V8 rumble that has beed around for years.
Years ago it was the V8 – 4 Barrel – 4 speed – positraction – loud intake – loud exhaust.
Today its V8 – fuel injection – 6 to 8 speed paddle shift – traction control – K&N intake – loud exhaust.
Suggestion to RF
These branding discussion generate a lot of interest and comments.
A review of the 3 Japanese luxury brands Acura – Infiniti – Lexus would be interesting, and slotting in Hyundai which has luxury aspirations.
This is totally OT, but:
Coke Zero is failing because it sucks.
Dude, what the heck are you smoking? A quick internet search shows massive gains in popularity and – more importantly – sales for Coke Zero. Not to mention that Coke has not brought out other flavors of the Zero line (true, the Vanilla DOES suck) based solely on the success of the formula. And they don’t even make Diet Sprite anymore because Sprite Zero was a smashing success.
@AGR – it’s a little off-topic, but you have any details about that Audi event? Is it one of those test drive events where anyone can participate, or is it a little more exclusive?
I dont have all the details.
For the driving e-mail invitations were sent out to “prospective customers” in each city / location.
Journalist are invited to drive the vehicles from one city to the next.
I think the disconnect here is the public (or enthusiast) perception of the Lexus brand, and the ToMoCo vision for the Lexus brand.
To the petrol scented peanut gallery that turns spots like TTAC into a motor loving Mos Eisley cantina, Lexus is meant to invoke visions of ultra luxurious, hands free motoring. Robotic perfection for those that happily choose predictability over the stratosperic highs and abysmal lows generally associated with owning something German. It may not stir the soul when you grip the steering wheel..but it’ll start every time you plop down on the leather, grip the remote control disguised as a steering wheel, and twist the key.
I’d gamble that this is not the image Toyota sought to create with Lexus…”The relentless pursuit of perfection” probably doesn’t mean JUST out “S-classing” the S-class. We’ve somehow become comfortable with making Lexus a one car brand, but if you watch the moves Toyota makes..that’s not the goal at all. I think their vision is a to create a line that makes it inconceivable to ignore what Lexus offers in the segment. Right now, unless you’re talking about the LS..you can.
mrcknievel:
I’d gamble that this is not the image Toyota sought to create with Lexus…”The relentless pursuit of perfection” probably doesn’t mean JUST out “S-classing” the S-class. We’ve somehow become comfortable with making Lexus a one car brand, but if you watch the moves Toyota makes..that’s not the goal at all. I think their vision is a to create a line that makes it inconceivable to ignore what Lexus offers in the segment. Right now, unless you’re talking about the LS..you can.
Nice to see that someone understands the reality of it.
The “pursuit of perfection” is NOT “the pursuit of luxury” (which many enthusiasts here on TTAC and on the internet in general seem to think it stands for).
The “pursuit of perfection” is literally the pursuit of perfection. Period. Perfection in motorsports. Perfection in quality, reliability, and durability. Perfection in luxury and comfort. Perfection in brand image and service. Perfection in technology. And yes, perfection in performance.
The Lexus tag-line stands for any one of those things, and it also stands for all of them.
“The Lexus tag-line stands for any one of those things, and it also stands for all of them.”
This is the problem here that nobody cares to realize. A good, strong, crystalline brand cannot stand for more than 1 thing in the mind of consumers. It becomes muddied and conflicts itself. Forget Lexus, forget sports cars and luxury cars; a great brand is one that can ONLY stand for 1 thing in a consumer’s mind and thus muscles out the competition for said mindspace. Lexus is fast on track to becoming what people automatically think of when they think “luxury car”. This extension will either change or at least delay what should be an instantaneous association within the consumer’s mind. Think “Kleenex”.
Lexus can be a great brand of cars and improve it’s market share and esteem by making this line of cars. Huzzah! They can steal a couple of M-class and AMG buyers and wear their puffy conquistador pants. This is not a matter of conquests, however, what we are debating here is MINDSPACE, a very limited part of a consumer’s memory and attention span that is cluttered with thousands and thousands of brands, and as Lexus expands into new and uncharted territory they will unquestionably have to break focus from pure luxury cars and thereby deflate the power of the brand they spent 20 years building. This will cause them to sacrifice this hard-won mindspace that only they inhabit which is a serious branding error.
People here insist on arguing a different point altogether – either that Lexus can make a great sports car so this is OK or petrolheads want a muscle car Lexus. None of that matters. This is a question of focus, pure and simple, and Lexus is going to lose the singular focus they have had by branching out.
Branding branding branding branding. Maybe if I write it enough people can change focus. Branding is the creation of a very predictable and specific brand identity and personality, and Lexus’ greatest strength is it’s perception as a 1-car brand. A 1-car brand is the strongest brand in the world! No confusion in consumers’ minds as to what you do or stand for. This is what people are missing – Lexus has done such a fantastic marvelous job of maintaining brand integrity that we all try and pigeonhole them as a 1-car brand. SUCCESS!
This may be a good business decision and will certainly up the ante in the world of super-expensive sportscars. However, it stands that from a textbook, college-classroom perspective, this is a branding error.
*bangs head on table*
kazoomaloo, yes this is about branding, but you seem to be just another enthusiast who does NOT get the branding of Lexus.
Lexus is, and has been nailing into people’s heads that a Lexus stands for the “pursuit of perfection”. Yes, many customers associate Lexus with luxury, but Lexus is very focused with it’s brand image.
In other words, the Lexus brand stands for ONLY one thing: the pursuit of perfection. This ONE thing though CAN emcompass many ideas and modules within it. There can exist a variety of Lexus models (for performance, for luxury etc.) AS LONG AS the brand CONTINUES to stand for “the pursuit of perfection” (which the brand will continue to do) and AS LONG AS future vehicles continue to have the qualities and characteristics attributed to Lexus (which the IS-F WILL have).
Enthusiasts and internet lurkers all have their own opinions on what the Lexus brand stands for, but when the average person sees a Lexus commercial or advertisement, they see “the pursuit of perfection” every single time.
A few performance models DO NOT interfere with the branding that Lexus is using, and it does NOT
make the Lexus brand lose any of it’s focus in terms of “the pursuit of perfection”.
Even if this is a “textbook, classroom perspective branding error”, who cares? The ONLY thing that should matter is the truth and reality. Decades ago, when Americans first found out about Toyota’s Production System, they mocked and ridiculed it. At the time, Toyota’s system did not fit the “textbook classroom perspective” of how a production system should function. Fast forward to modern times, and who’s laughing now?
Textbook authors have all changed their tune, classroom perspectives have changed, and automakers around the world continually scramble to try and keep up with the advances in Toyota’s ever-evolving production system.
Is there a chance the F-brand could fail? Perhaps. Are the F-cars a “branding error” for the Lexus brand? Just watch and see how focused Lexus will be with their marketing for the F cars, and how they tie into the Lexus brand.
I think that IS-F is hot but I would get more excited about it if it was a Toyota Soarer GT-R or something like that.
Even if this is a “textbook, classroom perspective branding error”, who cares?
If the F-cars work as advertised, there is no classic branding conflict.
I’m no marketing guru, but I have put together some marketing efforts, and have a master’s degree in business from a top-tier school that involved studying marketing under some top tier people, including some who consulted with the auto business. Based upon what I learned from that experience, I’d say that adding more performance models actually fits in well with Lexus existing branding message, by creating products that match it.
I’ve seen no support for the argument that this creates brand conflicts, when it’s well in line with the intended branding message. The problem with Lexus is that the products don’t always match the brand, but this promises to move one step toward fixing that disconnect.
kazoomaloo
This is the problem here that nobody cares to realize. A good, strong, crystalline brand cannot stand for more than 1 thing in the mind of consumers.
And we’re saying that one thing..Lexus is about the pursuit of perfection…that tagline is so vague that it easily encompasses the pursuit of the “perfect” luxury/sport sedan as well as the “perfect” luxo-barge. I think the only way they betray the brand is if they produce a car that is more Porsche GT3 than AMG/M. They CAN NOT build a car that swaps smooth sailing in silence with a hideous ride and booming engine noise and slap a Lexus badge on it..I’ll give you that..but they can build a car with GS/LS levels of luxury that does an impressive imitation of a comet when asked.
The LS is an incredible Lexus product, but as we’re seeing the LS is NOT Lexus.
I don’t have a problem with Lexus sub branding. I do have issues with sub branding sport performance with F-series, especially here in the North America because it is also a Ford Truck.
Lexus should have used, LRD-Lexus Racing Develoment or LPD-Lexus Performance Division.
F-series as in “Fast” is quite simplistic for a upmarket brand as Lexus.
Lexus should have used, LRD-Lexus Racing Develoment or LPD-Lexus Performance Division.
I’m glad they didn’t use “Lexus Automotive Performance Division” – LAPD
kazoomaloo: A good, strong, crystalline brand cannot stand for more than 1 thing in the mind of consumers. It becomes muddied and conflicts itself. Forget Lexus, forget sports cars and luxury cars; a great brand is one that can ONLY stand for 1 thing in a consumer’s mind and thus muscles out the competition for said mindspace. Lexus is fast on track to becoming what people automatically think of when they think “luxury car”. This extension will either change or at least delay what should be an instantaneous association within the consumer’s mind. Think “Kleenex”.
Many, including some respectable advertising/marketing guru’s, would agree with this sentiment and would say that a good focused brand can be reduced to one or two word description.
However, I cautiously but wholeheartedly disagree. True, a good advertising campaign should be focused to one clear theme. But in the larger marketing perspective, a brand image has the capacity to conjure many strong associations, not just one. One might say, a picture (brand, icon, logo) is worth a thousand words.
For example, when you see a Nike swoosh, is your understanding limited to athletic shoes? Not anymore. The company has successfully broadened the definition of Nike in deliberate increments. First they broadened the definition to “Sports Apparel,” which is inclusive of shoes but adds t-shirts, sweats, shorts, socks, hats, etc. Next, they broadened the definition to “Sports Equipment and Apparel” with their line of basketballs, golf clubs, volley balls, etc.
Throughout the brand extension, the company took care to meet price expectations, manufacturing and materials quality standards, and maintained fresh styling, all of which are critical. They also extended their line logically, over time to allow people’s expectations to adjust, and supported the change with advertising that effectively reestablished the brand in people’s minds through each transition. As a result, I know no one who becomes dizzy or confused when they happen to see a Nike swoosh on a golf ball.
The Detroit manufacturers squandered their brands through thinly veiled badge engineered garbage cars. They blew all of their customer goodwill through decades of sub-par design and use of flimsy components. Their brands become synonymous with poor performing, unreliable, gas guzzling, un-ergonomic cars. They created the perception gap (gulf) that now divides them from their Asian competitors. And now they have the gall to complain about it?
My point is that it was neither brand extension nor confusion that killed the Big 3, but taking their customers for granted and allowing their once-powerful brands to become associated with disgraceful second-(or third) rate cars. During much of the ‘70s, ‘80s and ‘90s, many American car brands could correctly be reduced by one crystal clear word: crap.
As for brands like Kleenex that only stand for one thing, while extraordinary, I take that as assign of brand weakness. Kleenex, for example, is imprisoned by its singular image. Yes, Kimberly-Clark has sold a lot of facial tissue, but the company has been unable to effectively leverage Kleenex’ good brand name for use with other quality products. The brand is moribund and should some new technology replace the need for disposable handkerchiefs, recalcitrant Kleenex will be discarded into the dust bin of history. Example: Polaroid.
The strongest brands have images that have clear positive associations as shared by the majority of people. The best brands are elastic enough to convey a message of quality, styling and price for an array of products.
“For example, when you see a Nike swoosh, is your understanding limited to athletic shoes? Not anymore. The company has successfully broadened the definition of Nike in deliberate increments. First they broadened the definition to “Sports Apparel,” which is inclusive of shoes but adds t-shirts, sweats, shorts, socks, hats, etc. Next, they broadened the definition to “Sports Equipment and Apparel” with their line of basketballs, golf clubs, volley balls, etc.”
The result is the Nike swoosh stands for absolutely nothing, except the Nike swoosh. Nike thinks I’m going to pay extra for a T-shirt with the swoosh on it. Honestly, it stands for nothing except -“Here, this is something with a swoosh on it, buy it”.
“…My point is that it was neither brand extension nor confusion that killed the Big 3, …”
You don’t think offering a full range of cars in every division and being able to buy a Buick for not much more than an Olds, for not much more than a Pontiac, for not much more than a Chevy was, in part, responsible?
Lexus is a brand that stands for things that to the enthusiasts on this site are probably not high up on the core attribute ladder. Follow after me.
I want a car that’s quiet (um, not really), unharried (in rush hour maybe) etc.. So what on earth is it doing working on a sporty sub brand. Ludicrous isn’t it? On its face maybe, but hold on a minute. BMW sells many more 3 series than there can be buyers who actually need and appreciate a european sports sedan. For every true enthusiast smitten by the silky inline 6 and the taut chassis there must be dozens who wouldn’t know an apex from an A pillar. So what is the attraction? Well 1 is clearly a premium brand. (Lexus has that too). But why choose a BMW when a Lexus is probably the far better car when matched against people’s actual needs. The answer of course is emotional needs which often have little to do with any tangible one. BMW owners like the idea of owning a sport sedan because of the story they tell themselves of what it means to and about them.
I suspect Lexus wants a whole bunch of that demographic to consider a Lexus, which on a practical level would be a sensible choice by offering a dose of the irrelevant sports appeal to help satisfy the emotional cravings
Replying to argentla :
Lexus is not a North America-only brand. It had trouble making a lot of headway in class-conscious Britain
No wonder that all British car makers went belly up. The Brits are way too delusional.
I suppose that car enthusiasts need Lexus to remain as a yardstick for boredom. When Lexus does succeed in building the true driver’s car, the German cars fans will no longer be able to bash non-Caucasian car brands with complete confidence.
You don’t think offering a full range of cars in every division and being able to buy a Buick for not much more than an Olds, for not much more than a Pontiac, for not much more than a Chevy was, in part, responsible?
GM North America is pretty much an exception to the rule when it comes to branding tactics. GM has typically carried 7-8 marques at any one time; most other automakers limit themselves to one, two or, at most, three. It’s really difficult to extrapolate a tale that describes the entire auto business from GMNA’s rather unique branding circumstances.
In any case, if you adhere to the TTAC definition of a brand, the “F” is not a brand at all. It is headlined by a single product (the LF-A in the photo above), which is used to transfer a bit of love onto the hotter variants of at least one existing model (the IS transformed into IS-F.) The brand in this case is Lexus, the F is just part of the product mix.
If this structure sounds awfully familiar, it should — BMW did the very same thing with the M1 supercar and the M-series sport variants. I would not be at all surprised if that is how Lexus came up with the idea in the first place.
I see this akin to Scope putting out a new flavor of mouthwash. Scope may tout itself for its minty virtues, but that does not bar it from releasing an orange-flavored product that will do cool things for your life, even though it tastes different from the product they spent years bragging about.
And it’s no taint on the brand of Proctor and Gamble that owns it, either. Just as long as the customers like the flavor and other features of orangy Scope, they’ll buy it, with no psychological harm inflicted upon on all of the other Scope users, including those who hate oranges and pray to the god of Spearmint twice a day.
“Nike thinks I’m going to pay extra for a T-shirt with the swoosh on it.”
Ahh… you might not, but millions of other people do.
“You don’t think offering a full range of cars in every division and being able to buy a Buick for not much more than an Olds, for not much more than a Pontiac, for not much more than a Chevy was, in part, responsible?”
You are absolutely correct. Brand overlap was (and is) a serious problem for The General. Likewise, I think Lexus’ biggest brand problem is that the ES is priced for not much more than the very similar V6 Camry. I feel the same way about the Land Cruiser / LX nexus. That’s not to say that I’m a knee-jerk anti-badge engineering freak. I think that the IS is different enough from it’s donor body, the Corola, not to be a problem. I consider the Highlander / RX relationship to be boarderline acceptable.
Nonetheless, Brand Overlap is a separate issue from Brand Extension.
@RF
You’re right about brand extensions in general, though it must be said that they sometimes do work. Even if they are overused.
William has an interesting point, if your entire brand image is dependent on another brands image, certain things are (should be) become possible.
@Katie
Lexus have succeeded in creating a superior luxurious car
No they haven’t. The have succeeded in creating a different type of luxury car. They ONLY offer plushness and reliability, which are not the only attributes that a luxury car may offer. Their attempts at an engaging driving experience have all but failed, (if they ever really tried).
Is the Corolla really the donor body for the IS? I didn’t know that. How much of a donor is it really? I mean, they’re about the same size but I imagine that switching a platform to RWD from FWD isn’t too easy.
To clarify: the Corolla and IS platforms have NOTHING to do with each other.
I stand corrected. I spent part of the evening last night looking for the reference I remembered reading 7-8 years ago indicating a shared heritage between the Corolla and IS. Apparently I misconstrued reports comparing the close similarity in size of the two vehicles to mean that they were built on the same structural hard points.
All the more reason why they don’t suffer from model/brand overlap…