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March 23, 2005

The Pontiac G6: All Buzz. No Bucks.

Remember all the hullabaloo from the Oprah Winfrey Pontiac G6 Giveaway? It was lauded by many as being a brilliant marketing move. At the time we questioned the tactic by blogging, ”… if the only thing remarkable about the Pontiac G6 is the Oprah Marketing/PR stunt, then is the car really remarkable?”

Now it seems the only thing remarkable about the Pontiac G6 is how UNREMARKABLE sales are.

According to the Detroit Free Press, sales of the G6 are at least 30% below expectations. And six months after its introduction, Pontiac’s marketers are getting desperate to move G6 inventory by offering $3,600 in incentives to goose sales. {Hmm ... not good.} As Seth Godin has taught us "… a low price strategy is the last refuge of a marketer who is out of ideas.”

The Oprah giveaway may have generated a lot of buzz for Pontiac, but it hasn’t generated a lot of bucks for Pontiac.

[Thanks to the Agenda Inc. blog for the heads up.]

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Comments

Who wants to walk into their office and tell thir co-workers they bought a Pontiac? *That's* the problem . . .

John, glad to see that you revisited this, as the G6 is a fantastic example of....well, continuous GM buffoonery, top to bottom, in just about every way imaginable, including marketing. Marketing is the least of their problems, though, and better marketing won't help until CEO Wagoner and others are gone, along with their obsolete strategies, incestuous culture and share-driven business model. The B.O.D. needs to change out a few members, too.

Pontiac and Buick are done. They just have not removed the feeding tube yet. You can't market around that, no matter what you do or how much you spend. If Chevrolet, Caddy, Hummer are to have any chance of surviving, (or GM itself), these two brands need to be buried; possibly even Saturn, too, and SAAB, for certain. As it is, they are all just aimlessly spinning and drowning in the GM brand-eddy of irrelevance and sameness, temporarily floated only by the bubble of incentive-driven unit sales, and all competing with each other for shared internal resources, rather than primary competitors. In reality, GM is a 40% smaller company than unit sales and market share would indicate. Profit share and brand relevance are what matter when you are that size, and they don't have much of either nowadays. Forget market share, that's going to go down condiderably, one way or the other.

The G6 Oprah Brilliant Marketing Caper: Many, if not most (straight) men despise Oprah and others like her as precisely the kind of tabloid trash that seeks to mold America's wives, sisters and daughters into oblivious, bleeding-heart, self-image-obsessed princesses. Agree with that belief or not, Oprah was never the right schtick for selling a car that was supposed to be a BMW-3 fighter, (not that it ever was, even on paper). Men, and many women buyers, are going to run away from that kind of association. They may as well have launched it with Gloria Steinem. Nope, D- is the grade, do over.

Thought I would chime in as a chick.

You always have to begin with a good product. But kudos to the marketing/PR team at GM for getting a lackluster product so much attention.

Imagine what sales MIGHT have been WITHOUT the Oprah exposure.

Disappointing G6 sales don't prove that the Oprah exposure didn't work. It does prove that the equation needs to be balanced just right: good products + the right distribution and business operations strategy + smart emotion-charged marketing = remarkable growth.

You can't merely single-out sales of the G6 product line and draw marketing conclusions; GM AS A COMPANY IS FALTERING. Sales of GM’s entire existing line of trucks and SUVs are down. They’ve scrapped plans for a 2008 line of rear-wheel-drive cars to focus resources on the trucks and sport utility vehicles it plans to introduce in the next 12 months. GM is in desperate need of dealer rightsizing (many GM dealers are located in declining metro areas). And company management is wrassling with mounting healthcare costs.

Millward Brown's Jamie Lord once said, "A good product is not enough to provide competitive advantage. Only brands can tap into the emotional needs of consumers and create a bond with them."

The Oprah marketing partnership tried to tap into the emotional needs of women, but in the end GM's lackluster product innovation, the dysfunctional dealer distribution network, and the company management inefficiencies are barriers to marketing success.

The lesson here is that marketing cannot operate in a vacuum and marketing alone cannot drive corporate growth. Cross-functional elements always impact marketing - and a classically trained marketer worth their salt understands and evaluates operations, finance, and logistics management as much as they do promotional efforts and strategy. In the end, this is why Andrea Jung is transforming Avon and Carly Fiorina failed at HP. Both Andrea and Carly are marketing geniuses...Andrea clearly demonstrates her understanding of operations and business accumen.

By the way, sounds like Thomas needs to move up and on over into this Century. Appears he is a bit threatened by strong women.

kindly,
kirsten

Thanks for that nice ending, Kristen. But nah, my girl is 5'11", broad back, corporate VP, drives like Schumacher and can fistfight a drunken sailor. She thinks Oprah is trash too.

Princess = tabloid-tainted, self-obsessed and weak.

dear, dear thomas....

Does "your girl" know you describe her as "broad back" and "drunken sailor" bawdy? Geez. I think you proved my point.

kindly,
kirsten

Aren’t we supposed to be talking about the meaninglessness or meaningfulness of the marketing partnership between Pontiac & Oprah?

Whattaya say we keep this conversation on topic ... okay?

I agree with kirsten. Marketing alone cannot save a crap product. Sure, people might buy it and use it (or get it for free in this instance), but the negative word of mouth generated would probably spread faster than anyone can say oprah. Maybe they should have just spent that money on improving their cars..

As one who's adult lifetime has coincided with the ascendancy of first the Germans, and Japanese, and now Korean automakers as well, I have watched slack-jawed for FOUR DECADES as U.S. automakers, GM in particular, have made one wrong move after another, until even the American car-buying public no longer takes much of their product offerings seriously.

To save on manufacturing costs, the "Big 3" rammed crappy down-sized front-drive models down our collective throats starting about 25 years ago. Even "prestige" makes such as Cadillac and Lincoln were forced through this process, and with next to zero mass-production experience, starting in 1980, wave after wave of inferior front-drive models was served up by Detroit, to a customer base whose U.S.-built loyalty was finally shaken loose by products that didn't begin to stand comparison with BMW, Mercdes, Honda, Toyota, Nissan, et al.

The first example in recent years, of an American company doing most everything right in planning and developing a new model for market, came with the 1986 Ford Taurus. Literally disassembling dozens of Honda Accords, Audi 100's and BMW's, Ford's engineers deliberately designed their new model to do everything those other, more expensive models could do, even down to the feeling of brake and accelerator pedals!

Interesting that from its first year, until the design and style of the Taurus were changed in the early 1990's, it was, for six years straight, one of the Top-3 Selling models in America, competing head-to-head against the Toyota Camry and Honda Accord from 1986 - 1992.

The problem is that U.S. corporate-think is weak and flabby, like most of the nation. Has Ford approached ANY new model offering since the Taurus, in the same fashion? NO!!!!!!!! For Shame - They of anyone should have learned a fundamental lesson from the Taurus experience!

GM likewise should have learned, but didn't. Oldsmobile, one of America's most historic auto makes, is no more, thanks to GM's criminal lack of attention to keeping each division relevant and yet different. The division that produced the Rocket V8, and the 1966 Toronado, was reduced to such eminenty forgettable piles of medicority as the Achieva and Alero. They utterly savaged the Cutlass, in the l980's, a model which had been the BEST SELLING CAR IN AMERICA through the 1960's and 1970's, and even into the 1980's before they radically changed every conceivable design element, REMOVING those very features that had endeared it to the American Driving Public for FIFTEEN STRAIGHT YEARS!!!

By continuing to focus their best engineering and design on narrow-niche-market vehicles, GM's management continues to thumb its elitist nose at the very market segment most prized by their foreign competitors.

Go visit a Toyota dealership. From the lowliest $12,000 Echo, to the $40,000 fully luxed-out Avalon, every single one of their models screams out: "QUALITY!" Do the same at a Honda, Acura, Lexus, Infiniti, Subaru, Mazda dealership, and you'll register much the same result.

We Americans deserve better from those hired to run our largest corporations. It's easy to take the dispassionate view that poor management causes companies to deserve to fail. However, those failures translate into yet thousands more decent-paying jobs lost to the foreign manufacturers, and a steadily eroding standard of living for American workers.

In 1986, the year of the new Ford Taurus, the largest single private-sector employer in the U.S. was GENERAL MOTORS. In 1986 money, the tens of thousands of GM employees were paid an average of OVER $20 per hour.

In 2004, as Lutz and his cohorts were working to bring the Pontiac G6 into being, America's largest private-sector employer had become WALMART! In 2004 money, the tens of thousands of Walmart employees were paid an average of UNDER $15 per hour!

What's the remedy? Maybe the upper management of America's more strategic companies, should never be paid performance bonuses in the same year or year after. Maybe, the bonus fund should be escrowed, and re-evaluated at five years and ten years out, from when originally the bonus was declared. Maybe, the decisions and policies being pursued by top management in 2005, should be re-evaluated in 2010 and 2015 for their impact on corporate performance NOT just in one given year! Maybe, forcing management to think (based on management's own pocketbook concerns) about the long-term, might be beneficial, not just for GM, not just for its employees, not just for its customers, but for the entire nation as well. And every factory incentive used to help sell a recently introduced model, should be directly DEDUCTED from any bonuses payable to upper management!

All I see here is trash talk. You guys don't know what you are talking about.

Go drive a fully loaded G6 with the panoramic roof, it's amazing.

Let me just say that the marking idea on ophra was good and that the Pontiac G6 is one of the best cars i have ever had the only thing bad about it is that it needs a somewhat bigger windsheild thanks

I think it is a discuraging thing to see so many people judging a product and a name without ever taking an honest look at what either has to offer. If I had to guess, I would say the majority of all of you talking so much trash are currently driving Toyotas; Wich I might add have less to offer and cost much more. Go out to your local Pontiac dealership and take a look at the Pontiac line-up. I think you would be pleasantly surprised.

I have had 2 Volvo´s and 3 BMW´s, but when I rented a G6 from Avis in NY, I was really surprised.
It is well made and a lovely driving car. Apparently, the public is slowly discovering this too.
And I read in the press: Following up on G6’s Strategic Vision “Total Quality Award,” the company’s latest survey gave G6 the highest “Customer Delight” score in the mid-size car segment, besting many top selling imports. Good for GM!
(In Europe, where I live, I drive Peugeot and BMW right now.)

I test drove over 40 cars before buying an 06 Pontiac G6. The engineering in the G6 is remarkable. Built on a Saab Epsilon platform, comes stock with an awsome sound system with a nuked out computer designed sunroof on my model and hey if you have the money check out the hardtop convertable what a trip to watch the top fold into the trunk. Has anyone looked at the 07 turbo charged solstice what a sweet car at a affordable price. GM will make a comback if people just look at there products, instead just talking SMAK. Yes the Japanese did rule the 80's and 90's but the at least 2 of the big 3 Gm and Chrysler are making belivers out of some of us. Check out the heated and cooled cup holders in the Chryslers. I copied this from the boston globe-Foreign-based manufacturers like Toyota can identify models like the Camry as ``domestic" cars because they meet the government yardstick of having 75 percent or more of their parts made in the United States or Canada.

But the Automobile Trade Policy Council, a lobbying group funded by GM, Ford, and DaimlerChrysler AG, says the domestic content of all Toyota vehicles sold in the United States -- including imported models -- is 48 percent. Honda's is 59 percent and Nissan's 45 percent.

For GM and Ford, the domestic parts content is 73 percent, and for DaimlerChrysler, it's 72. We really need to keep our jobs at home or we will become a 3rd world country.

Japanese and Korean automakers produce such bland unreliable garbage please, i'd take a G6 over an Elentra or KIA any day!

I intend on buying a G6 this week. It's used with 30,000 miles on it, but I couldn't afford a new one, even though the prices are not outrageous. I am very impressed with the car because it doesn't feel cheap like other GM cars (ie. lots of creaking plastic panels in the saturn aura (although that aura xr packs quite a punch under the hood). I work for saturn, and they are great cars for the market they are in, but I prefer the quality and style of the pontiac line.

We love our Pontiac G6 convertible with the sports package. No complaints here. I've owned a BMW, Acura integra, Mustang G6 convertible, Toyota, and a Subaru. She drives the G6 and reminds me everyday how much she likes it and the compliments that she (or the car?) gets.

I've endeavored to understand why quality is not quantifiable. The art of the body style is in the eye of the beholder. Professional sports teams and musical groups seem to have it and loose it. GM has lost it or has deliberately chosen low quality (i.e. price). Wal Mart has done well with that strategy.

Conversely, GM may be succeeding globally even as it appears to be failing in North America. Oh, and did anyone notice the looming contract negotiations?

The Pontiac brand gets buried today. Not even Oprah could save it!

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