MFG 2.0

The Real Toyota Recall: Its Main Brand Promise

Interesting piece up by Matthew May at the AMEX business blogs, deconstructing what he sees as the most interesting -- as well as the most impactful -- aftershocks of the recent Toyota recalls. That is to say, the emotional reactions of current and future customers who bought into a brand promise made by Toyota that it seems the automaker was accelerating too fast to deliver.

Mays first lays the groundwork for his argument by referencing a famous marketing innovation story, in this case from a different automaker during tough economic times:

The idea of perceptual, emotional or otherwise intangible value in business can be traced back to the Great Depression, when Cadillac effectively stopped selling automotive transportation. In the 1930s, Nicholas Dreystadt took over as the company was about to fail and announced that Cadillac did not compete with other automakers, but that “Cadillac competes with diamonds and mink coats. The Cadillac customer does not buy transportation, but status.” That simple perceptual innovation translated to a price premium and saved the company. Within two years Cadillac had become a major growth business despite the dismal economy.

According to May, that same perceptual innovation has been applied rigorously by Toyota over the past decades. What they've been selling is not an automobile, but the perception that the consumer who bought Toyota could perceive a quality product. In essence, they were purchasing the status of the discerning, intelligent consumer. And, according to May:

What is happening to Toyota right now is that the emotional bonds of trust, built painstakingly over decades, is being eroded by the dramatic scope and scale and suddenness of their product quality issues. Many people, loyal customers, are feeling betrayed.

Reading May's post reminded me of an experience that I had at the beginning of last year, back during the huge peanut butter recall. I had literally just finished a peanut butter Clif bar -- a company whose folksy, homemade brand promise I had entirely bought into -- when I read that the Clif product line (including, but not limited to, the batch I had just sampled) was on the recall list for using ingredients from the largest -- and definitely the nastiest -- industrial food outfit I've ever heard about.

The feeling was that of my stomach dropping to the floor -- and not just because the details of the recall were seriously nausea-inducing. I actually felt betrayed on a personal level, like a friend had lied to me about something important. Which is an overblown and melodramatic response, I know, but it just goes to show that even those of us who read the brand promise tea leaves for a living, also have a favorite brand of tea ourselves.

(Editor's note: My earlier post about the Clif recall can be found here: Do you eat food? Then you probably want to read this.)

TAGS: Innovation
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