Toyota ads move beyond the recall

toyota_dealer_100127.gi.top.jpgBy Shelley DuBois, contributor


(Fortune) -- New ads from Toyota's local dealers look like they're missing something.

The commercials play up the features of new cars, show clips of Toyotas driving and highlight all the good deals out there. Except for lower prices, it appears to be business as usual.

But what about the recall? The company has already recalled more than eight million vehicles for problems related to sudden acceleration, which have been blamed for several accidents resulting in injuries and death. Is Toyota moving on too soon?

"That would be exactly the way I would handle it," says George Peterson, president of AutoPacific. At this point, he says, any respectable PR person would advise Toyota against running ads that reflect negatively on the product.

From a marketing standpoint, Toyota needs to present its recall as a glitch in an otherwise impressive company history, Peterson says. Lucky for them, the carmaker has the track record to back up that image. Toyota recently won the most 2009 J.D. Power Initial Quality Awards of any auto company, and "they have been a solid corporate citizen for decades."

Toyota tried to remind customers of that in its apology ads that ran during the 2010 Olympics. Two in particular, called "Restore" and "Commitment," begin with black and white stills of Toyota car dealerships and pictures of early customers. The ads acknowledge the recall, then cut to images of present day workers solving problems.

Those commercials are aimed at people who could buy a car in the next two to three months. But ads from local area dealers generally target people who are going to buy by the end of the month. It's never their job to apologize for a corporation-wide problem. Commercials for local dealerships are supposed to get the merchandise off the lot.

Now, Toyota has offered 0% financing and low down payments for some of their most popular models, so those are the numbers that local dealers are going to push.

"Toyota is waging a price war," says John Wolkonowicz, an automotive marketing consultant at IHS Global Insight. And he thinks they could win.

To do that, Toyota will need to run a kind of marketing triage, he says, and that means doing everything they can to keep their most crucial customers: baby boomers. "They've been buying Toyotas for 20, 30, 40 years," he says. "For the most part, they've had a very satisfactory experience."

He thinks boomers will stick with the brand unless owning a Toyota becomes embarrassing.

"Once they anoint something, they don't like to be proven wrong," says Wolkonowicz, who has studied the core values of the boomer generation for 20 years. "There are people who are saying [Toyota is] damaged for a long time, but I think they're going to come out of this."

But some experts say the recall issue it too big to let go of so soon. "I don't think it'll sell well with the public. I think people, especially in these age groups, they'll see through it," says Jim Gilmartin, owner of Coming of Age Inc., a firm that specializes in marketing to seniors.

He agrees that Toyota ads generally work for baby boomers. "They're pretty good. Really what they were saying was 'be a part of our experience.'" Those kinds of emotion-based ads tend to be effective for older buyers, he says. But in this case, he says, they're not buying it.

"Many people are violently angry," says Peterson, after reviewing the feedback from Toyota owners on his company's satisfaction questionnaire. The numbers bear it out: sales dropped 9% in February.

Barring any more recall problems, Toyota can consider itself in the clear if it comes out ahead or breaks even by the end of the year, says Wolkonowicz. And if it's going to make it, it's on the right marketing track. He believes that many of Toyota's prime consumers might be ready to see ads that don't mention the recall because they're already sold on the product and have been for years.

"From my perspective," Wolkonowicz concludes, "the last thing they want to do is talk about the problem any more." To top of page

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