Wednesday, January 14, 2009

GM and Brand Name Deletion

Those of you who have never had the privilege of working behind the walls of something as massive as General Motors have no idea what kind of politics are present. All of this blog focuses upon my perception of GM from my (somewhat limited, but probably correct -- from the mid eighties) view of their internal politics, and how they apply to their present (somewhat dubious) plans to delete brands like Pontiac, Saturn, Saab and Hummer.

My view: GMs politics were similar to the ones in our government -- only with several political parties instead of just 2 major ones.

From reading the news, GM will likely sell Saab and Hummer (though that's also speculation) and simply blow away Saturn and Pontiac like they did the Oldsmobile brand.

A disclaimer here: GM -- I'm not a fan. I don't purchase your products. Although my father was a big fan of your Buick products, I didn't find the excitement there at all. But I feel compelled to weigh in (albeit, briefly here, given my time constraints) on the obvious coming shortage of GM brands.

Likely, there's some huge internal power struggle going on inside of GM, with VPs and other executive types acting upon the current crisis with all of the surgical precision of say, cluster bombing.

I can almost read the politics from remote: "My division is more profitable -- yours is not." and so on. Somethings gotta give -- why not a bunch of brands? Isn't this required to show that GM wants to pare down to some kind of lean, mean fightin' machine?

Well, in my not so humble opinion -- tactically, maybe, but strategically, no.

Brands can't easily be created (look at all the work that went into the creation of Saturn, for example). Brands have an emotional impact upon buyers. People are very brand-centric when it comes to a purchase. Getting people to switch to another GM brand if they're a loyal Saturn buyer -- and its gone, for example, isn't exactly a sure thing.

If GM wants to get serious, they should seriously rethink this thing from the perspective of the customer, in other words. Here's what comes to mind, when I quickly think of GM brands that exist today:

  • Cadillac: Sport Luxury.
  • Saturn: Import fighter.
  • Pontiac: Sporty. Younger crowd.
  • Chevy: Mom and Pops reliable shop.
  • GMC: Rebranded products from the other lines. Redundant.
  • Buick: Family cars for Sophisticated people that .. no.. crap. I hate the whole idea of this car segment -- ask someone else.
  • Hummer: SUVs for people that want to pretend they're fighting some kind of war -- or for people that want people to see them in a Hummer... I have a queue of Hummer jokes here that I'm omitting.
This is a lame assessment of their brand status-quo from my perspective. It's probably about 80% accurate though. GM needs to do this kind of assessment with some teeth, and then re-cast the vehicles they produce to match the brands. They need to merge all of the control of the brands and engineering into one spot and keep the names and the products. They need to consolidate the management of the stuff in other words -- but don't blow away the brands.

Want to piss off your buyer base GM? Try being a Pontiac-lover and finding out that your favorite vehicle is no longer available. Maybe you (the customer, in this context), will just have to find a new favorite -- say over there at Toyota. Toyota: remember those guys? They went out of their way a few years back to create a whole new brand. Probably took them some time... Creating the Pontiac brand over again after pissing off a huge group of people isn't a snap. Moving buyers isn't going to be easy, and maybe they'll try some other game if this one has been canceled due to rain (or tactical stupidity).

Consolidate the management, and clearly do some surgery on the brands that exist today. Does Cadillac need a corvette? Does Cadillac or Buick need an SUV? These kinds of things, floating around your brand-space, tend to be somewhat confusing in my humble opinion. Do you need to make stuff exclusive? Can you sell the missing components from all the brands from all of the dealers, in other words? For example, you're at Pontiac -- they don't have a Corvette equivalent -- can't GM relax the rules a bit so that the dealer is allowed in this context to sell a Chevy Corvette?

All of these items probably seem crazy, so I'll shut up now. I just feel compelled to point out that the deletion of Oldsmobile was extremely short-sighted. It was short-term thinking to address a short-term problem of profitability. Rather than do the easy brand-delete, GM should have taken stock of what they were doing wrong to chase off potential customers to that brand.

My guess is that all of this deletion contemplation is a way for some executives with power to out people they don't want to work with at the end of the day. Rather than do the hard thing -- re-organize into a single power structure that makes sense, they're probably killing off brands (and all of the redundant people that manage them).

All speculation, on my part, I know.

Regardless -- making brands make sense is still the hard task at the end of the day. Blowing away time-honored brands (and loyal customers), is the easy part.

GM, think strategy here. Think about your customers. Think about a lean GM with all of the brand names of today. I know it can be done.

No comments: