GM = General Misery?

My GM car dealership called Saturday to point out (as if I didn't know) that my Cadillac has over 124,000 miles and 'is there anything we can say to convince you to purchase a new car today?' I don't think so, at least not a new Cadillac. Will Cadillac even be around when it reaches 124,000 miles? This sad state has been blamed mostly on lack of innovation, unions, poor production practices, and more. But only Al Ries (Mr. Positioning himself) has made a point of suggesting perhaps, poor brand strategy may have played a role. Here's an excerpt from his article in Ad Age 12.2.08:

It seems to me that the fundamental nature of Detroit's Japanese competition is its ability to build brands. Toyota stands for reliability, Scion for youth, Prius for hybrid, Lexus for luxury.

But what does Saturn stand for? Or Chevrolet? Or Pontiac? Or Buick? Or Cadillac?

It's not for lack of trying. In 2007, the U.S. automobile industry spent $4.6 billion on advertising. That's 3.3% of total U.S advertising spending and 5.9% of total U.S. network TV spending.

For all that money, you might think the U.S. automobile industry would have done a lot of brand building. Take Gillette, which over the years has marketed seven different brands:
Gillette blue blades
Trac II, the two-blade razor
Atra, the adjustable two-blade razor
Sensor, the shock-absorbent razor
Good News, the disposable razor
Mach3, the three-blade razor
Fusion, the five-blade razor
Gillette has an astounding 71% of the world's wet-shaving market, and multiple brands, in my opinion, are the primary reason.

The difference between Gillette and General Motors is that each of the seven Gillette brands stands for something specific and each of the eight General Motors brands does not.

Although I may be biased, he has a point. Better attention to differentiating the brands in its portfolio may have avoided some of the mess. Reis suggests a portfolio built around product differences, rather than, well rather than whatever it is that they did end up trying to differentiate. A four cylinder Cadillac simply doesn't make sense. Reis maintains that the brand portfolio has been so devalued, that GM should simply start over.


Do you agree?

Al Ries On Obama's Positioning Strategy

Al Reis coined the term 'positioning'. This week he wrote an article in Ad Age on why Obama's positioning strategy was so effective -- and McCain's and Clinton's were not. We have discussed a lot of this in class already, but thought you might enjoy hearing it from the Godfather of Positioning himself.

Positioning Multiple Benefit Products: What's the Tradeoff?

I just read about a fascinating new study in the Journal of Consumer Research by Arthur Chernev at Kellogg's School of Business that is relevant to our positioning conversation. The question is whether consumers evaluate multiple benefit products more or less positively than single-minded benefit products. This issue is a common one, just think of the number of commercials that continue with "but wait!! There's more!!" The research attempted to address questions like, 'Does an iPod play music better than an iPhone?' and 'Does a standalone printer make higher quality printouts than an all-in-one printer/fax/copy machine?' and 'Does a laundry detergent promising great cleaning power remove stains better than a laundry detergent that promises both great cleaning power and enhanced protection against fading?'

Through series of studies across five CPG (Consumer Package Goods) categories such as toothpaste, vitamin supplements, cold remedies, shaving cream and detergent, the authors conclude that the Master of One strategy is more compelling to consumers than the Jack of All Trades Strategy. Chernev found that a product specializing in a single attribute is perceived to be superior in that attribute relative to an all-in-one product having multiple features. The wrinkle is that a higher price for the all-in-one products can overcome the undermining effect of multiple benefits. Chernev found that the perceived attractiveness of the all-in-one option can be increased by placing it at a higher price than that of the competing specialized options.

Click here to read more about how the study was done. Does this resonate with your experience? Aside from increasing the price, can marketers increase the performance credibility of all-in-one products? Or should they simply not even try?