Don’t ya just love marketing guys who trot-out terms like UIO (units in operation, i.e. sold cars) and say things like “We have seen both positive and neutral perceptions grow, and negatives decrease. So we have moved lots of negative perceptions to neutral”? Neither do I. Of course, I’m sure Hyundai Motor America’s VP/Marketing Joel Ewanick is, like most of God’s children, a lovable human being. And if you’re talking to Marketing Daily (MD), what’s a UIO between friends (sounds like something Morris Day would sing about to me)? But I digest. And here’s some interesting factoids from the Ewanick’s Q&A. “We know that 40% of those buying Genesis have traded in vehicles like Lexus, BMW, Mercedes, and Porsche. We know what their income levels are, and we are finding that people are gravitating from luxury or near-luxury cars to Hyundai.” MD reminds us that “since the sedan version of Genesis went on sale in July, the company has sold 5,127 of the cars, including 1,151 of them last month.” That’s far short of Hyundai’s targets, but a pretty good showing in a market so down it has to reach up to tie its shoes. Anyway, about that Super Bowl ad…
“In the first part of the year, we’ll be on big stages–some of it NFL football, including the playoffs, and some with the Academy Awards, with a lot of overlap. [Such events] give us an opportunity to state our case and show that this is another Hyundai. If [consumers] aren’t forced to reconsider us, they won’t.”
Hang on; I’ll get my Glock. Meanwhile, here’s the UIO bit:
“Units in operation (UIO) is one way to get there [sales]: if people see our vehicles on the street, the more they see them, the more they get comfortable with the brand, and marketing needs to parallel that. The other school of thought is boosting marketing to propel the brand ahead of UIO. We are doing both: pushing marketing into bigger places while consumers are seeing new marketing products show up on streets.”
So, if the point is for people to see Hyundais on the street, why are they designed to mimic other brands’ cars? I guess you need a marketing degree to understand that sort of thinking.
What they’re not saying: they’re well below their 20,000/year sales target for the car. But then this isn’t the strongest luxury car market, even with people defecting in droves from the established luxury marques.
Maybe potential buyers are concerned about reliability? The Genesis is easily the most complex Hyundai ever made. How’s it holding up? Thanks to help from the GenesisOwners.com forum, TrueDelta will have an initial reliability stat for the Genesis in mid-February.
http://www.truedelta.com/reliability.php
But I digest. (Emphasis added)
No wonder this is giving you heartburn…
since the sedan version of Genesis went on sale in July, the company has sold 5,127 of the cars, including 1,151 of them last month.
On an upward/flat trajectory, then. In this market? Not bad.
On an upward/flat trajectory, then. In this market? Not bad.
Yes in the words of my broker “flat” is the new “up”.
If we roll our eyes and say this car isn’t meeting expectations… Take note that the Cadillac STS sold only 630 in the same month… The Lexus GS 721..
Both of these cars suffered about 50% monthly sales losses since mid summer levels while this car (which makes more power) has had sales remain steady…
I’ve seen the car on the street, they are not at all hard to find in Southern California… The GS is nicer to look at, but the Genesis is miles ahead in the looks (and power departments) then the STS or the CTS.
There is a reason that the Hyundai Marketing VP is smiling.
I think that Hyundai timed the Genesis just right. I was reading an article today about how the stock market drop has caused some billionaires to lose lots of their money. So here it is a recession, the upper middle class’ leases are running out on their Mercedes and Lexuses, and they can’t afford a new one because everybody is cutting back due to the economy. So here is a car that offers everything that the big players have, for $20,000 less. Yeeeeeaaaaaahh. IMO, the Genesis is starting to make the people at Hyundai look like geniuses, because it was just timed so perfectly.
I still haven’t seen one…they must be selling like hotcakes. Hotcakes with a 10 yr warranty that is.
There will be 5128 on the road in the next week or two if I have anything to do with it. I’m probably getting one soon, test-drove it recently and it was really far superior to anything in its price range for what I am looking for (roomy luxury car). The Lexus dealerships have nice wood and free coffee and loads of desperate salesmen, the Hyundai’s was a beat-up old Ford dealer, but I’m only going once to buy it. It was the only car we test drove where my wife immediately said, “this is REALLY NICE.” This car won out for me from G35, ES 350, Mazda6, G8 and a couple of others. I think it is a great car and will be putting my 33K on it in a few weeks.
“Units in operation (UIO) is one way to get there [sales]: if people see our vehicles on the street, the more they see them, the more they get comfortable with the brand, and marketing needs to parallel that.”
UIO is an ancient career-saving weapon in marketing-man’s arsenal. The short version is: “We’re not selling enough, because we’re not selling enough.” The corollary is: “If we would sell more, we would sell more.”
Karesh – the original target was 8,000 sedans in 2008; 20,000 was their goal in 2009 along with 30,000 coupes. Of course it’s unlikely they’ll hit those targets in these economic times, but hindsight is 20/20. With a healthy economy I think most people picked total Genesis sales to have a peak full year retail level around 35K to 40K units… with a slumping economy I’m sure it’ll be much less.
You know it takes 3 years to bring a car to market, so it’s not very helpful to over-analyze the cars on the road today. I don’t know a single person that will put their money where their mouth is regarding the business plan for a profitable vehicle (that is business profitable – not just positive margins) to be sold in 2012. Common responses of late usually embody a healthy dose of “people like small cars…” but this is extreme armchair quarterbacking.
We’ll have to wait a year and see how it all turns out. The Genesis may end up doing rather well in spite of extremely poor timing for the market launch.
I have no trouble believing other luxury car buyers would put the Genesis on their shopping list. I have a Lexus ES300 and LS430, and I’ve been looking at the Genesis and the Lincoln MKS, as well as the usual A8/7/XJ/LS/S. I would never consider a 300C, G8, 3-series, nor CTS, cars that are supposedly it’s competition.
I appreciate it’s fullsize and conservative looks. The Genesis is quieter than a ES300 or E320 and almost at LS430 or S550 levels. I found the ride to be way too firm (though fans of German sedans wouldn’t notice), and finally decided to cross off the Genesis/7/XJ because I never want another RWD car for a Canadian winter again (winter tires + RWD still sucks).
A glaring market positioning issue that hopefully Hyundai will address in their next flagship.
I call the genesis a smashing success. Look, they sold their 5000 units in one half of a year out of worn out lackluster showrooms in a crashing economy.They also had no “deals” on these puppies. This has got to be the quintessinal argument for “it’s the product stupid”. For those that live in their cars hundreds of hours per year (all of us), this product is at least the 1990 lexus ls400. And to do it without a super structure of an entire dealer network ala lexus is breathtaking. What a year to not have opened several hundred new car agencies in the US. I predict this car sells itself and helps sell the lesser Hyundais like the Azera. The final benefit, they can get the later model American franchise stores as they become empty across the country. (at pennies on the dollar).
I like the car, but I think that we have to wait a couple of years before we can declare success or failure for Hyundai.
The success of their entry into the luxury market depends on the dealers and the service departments now.
Any new car will have some problems that the engineers and road testers didn’t find…. ask Mercedes. Acura also had them with the intial Acura Integras (I have personal knowledge). It doesn’t matter that things go wrong or break. What matters is how the dealers and the service departments take care of those problems.
If there’s a problem now and again, and you can jst drop the car, get an equivalent level car as a loaner, and be on your way, it’s no big deal.
If you have to go and stand in line, argue to get a loaner, and then wait two weeks for parts from the motherland while schlepping around in a Kia Rondo et al, then it starts to get annoying. If that happens more than a couple times, it’s a deal breaker. Happened to my friend who leased a VW Tourag. When the lease was over it was back to Lexus.
That I think is the test. They can capture buyers, but can they keep them? Only time will answer that question. When they get second-time buyers, then Hyundai will have truely launched in the luxury market.
If you want a historical example – let’s look at the Rover Sterling. Exactly the same car as an Acura Legend but with English leather. How could it fail? It had very strong intial sales too.