The ad industry has always been ageist. So when Bram Williams, strategist and founder of AW, woke up one day to the sobering realisation that he was, in fact, the old guy now, he knew something had to be done.
Enter The Third Act, an AdNews exclusive series that aims to celebrate different generations within the industry and provide perspectives that everyone can learn from—or, at the very least, find mildly interesting.
In this article, Bram sits down with Linda Peyronny, Project Manager at Orchard, to discuss the shifting gears of the automotive industry, and what Chinese brands should be doing to get ahead Down Under.
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As a strategist having worked across brands like Toyota, Holden, Lexus, Volvo, Hyundai and Subaru for the better part of his 30+ year career, it’s safe to say Bram knows a thing or two about automotive advertising. But the truth is, even with all his experience, the rules of the car industry are being rewritten faster than he could have imagined; one notable difference being the influx of Chinese manufacturers vying for market share. Thanks to her work on the cutting edge of car-selling technology, this is something Linda knows only too well.
Bram begins the discussion by reflecting on what buying a car used to mean. “Cars were seen as a long-term, practical, investment that also gave you the opportunity to say something about yourself to the world” he said. Think a Tradie buying a Hilux because it’s logistically sound, and makes them look cool on the building site. Or a new Dad buying a Volvo because it’s reliable and spacious and does the job of telling people he’s a good, safety-conscious parent. “Nowadays, for many people - especially those in more urban areas - purchases seem to be made with a slightly more dispensable mindset.”
Linda agrees, pointing to the pandemic as a major “turning point”. “Before, the process could take months, with people spending a lot of time browsing, taking test drives, and consulting with salespeople," she explains. "Now, it's often a decision made in less than a month. Consumers have nearly all the information they need online, so when they do visit a dealership, they already know what they want."
One of the major challenges with customers having access to such detailed information online, is that they’re just as quick to decide when they want something new. Linda goes as far as to liken the car-buying experience to shopping for clothes: “People pick something that fits their style and budget, and if they get tired of it, trade it in for something new.” This behaviour is, of cours,e partially facilitated by the plethora of financing options available in today’s world, but is also representative of a blurring of the lines between automotive and technological goods. As Bram states “Cars are no longer seen as long-term commitments but rather as part of an ongoing, evolving relationship with technology.” Linda agrees, adding “Consumers today expect cars to have state-of-the-art features, whether it's a UV light to clean your phone, heated seats, a snazzy screen, or the latest in driver-assistance technology. It’s like buying a phone or a computer - people want the newest gadgets”.
But technology in cars is old news. What’s new, however, is consumers making purchasing decisions about cars in the same way they do technology. This is where the wave of Chinese brands flooding the Australian market have some advantage. “They’re shaking things up” Bram states. "They’re not afraid to experiment with technology and design in ways that the established brands haven't. It’s like the fast fashion industry, where the focus is on what's new and trendy."
That being said, however new and trendy they may be, they’re undoubtedly going to have two major issues to contend with: how to stand out in a saturated marketplace and how to engender brand loyalty. With so many options available and the dispensable mindset of their audience, Linda goes so far as to say that loyalty within the automotive industry is becoming a rarity, reserved mostly for enthusiast brands like Jeep, who cultivate strong, almost cult-like followings. "For most consumers, especially families, buying an everyday car today is all about finding the best value," she explains. "With the rising cost of living, it's less about the brand and more about what you can get for your money. It’s a shop-around-world."
This is a far cry from the world Bram once knew: “Once upon a time, automotive brands built loyalty through generations of commitment to a certain set of service conventions and values.” The notion of Once a Holden family always a Holden family rings true here. He reminisces about the joy children used to get through collecting stickers and posters from car shows their parents took them to. “Brands put effort into connecting with kids, and were willing to wait 20 years to reap the rewards,” he says.
And it isn’t just the new Chinese car brands that are going to struggle with these issues of distinction and loyalty. It’ll get the mid-tier brands as well, as they run the risk of getting lost in the sheer volume of badges on the market. Bigger players who are either an enthusiast brand like Jeep, or have a monopoly on a certain demographic or geography like Toyota won’t be majorly affected, although even they have been doubling down on their advertising efforts in recent months, so the issue is clearly on their radar. But the likes of Nissan, Mazda, and Hyundai need to be making some sound strategic plays to ensure they maintain their slice of the pie.
It’s not all doom and gloom for the nation's beloved mid-tier or its shiny new entrants. They just need to think a little differently and uncover some genuinely fresh insights to base their marketing activity on. Because one thing that hasn’t changed over the last few decades is the fact that the car you buy says something about you as a person. Bram’s earlier example of the Tradie and the Hilux or the Dad and the Volvo still resonates. And herein lies the key. If these brands can get under the skin of their prospective customers and expose some real, potentially ugly, human truths about them, they’ll be able to stand out from the crowd and begin the process of nurturing brand loyalists.
No mean feat, but certainly not impossible. And happily, something that agencies like ourselves, have a bunch of experience in. So, if you’re a marketer reading this and nodding along, you know what to do!