The Blog

Chrysler – When Design does – and doesn’t – sell…

News today that Chrysler has declared bankruptcy. Wow – really, it’s only 30 years to late. In reality, Chrysler was dead back in 1979 when they took government loans to stave off bankruptcy.

I remember that time pretty vividly. Within a year, Chrysler was on their way to “recovery” thanks to Lee Iacocca, and the infamous “K” car. And, the Dodge Aries K was the first car I ever drove – back in 1980 in a drivers-ed class. The second car I drove during that same driving class was a Toyota Corolla – and the quality difference at that point made me understand why the Japanese car industry was overtaking the world.

Toyota, Mazda, Datsun (now Nissan), Honda and Subaru, 30 years ago – built cars that were cheap. Sure…maybe the interior plastics didn’t mix well with sunshine over time. But they ran. And ran. Didn’t break. Never left you stranded.

At the same time, it seems the “Big 3” were still trying to believe they were on top of the world like they were 10-15 years earlier. Yet, both the style of cars they built, along with the quality of the product the offered….well, just plain sucked!

The Japanese – they listened. They paid attention to what the customer was asking for. Quality, reliability, value – and style. About the time Chrysler was getting lucky with the whole “minivan” concept (which I believe is what truly rescued them back in the 80’s) – Japanese cars went from being “cheap, reliable, and funky” to “good value, reliable, and attractive”. Just like Korean manufacturers like Hyundai is currently doing.

Ford, and to some degree, General Motors, have finally started to figure all of this out. The Ford Fusion – I drove one as a rental car a few months back – yes, it’s built on the same platform (as well as, I think, the same assembly line) as the Mazda 6. And, I thought it was finally something that would make me look at choices other than a Camry or Accord. The Chevy Malibu – same thing. But the Chrysler Sebring I drove last year – what a piece of crap!

For $20K – you get something that can’t merge in traffic, makes you think you could disassemble the interior with a dull screwdriver, and had a funky smell of plastic release agent that made me think that on a long distance drive, would be more effective at getting one high that peyote! Not to mention it’s industrial ugly.

Even the Chrysler 300 – with it’s “gangster” look – aggressive, yes, but one design straight “from the hood” doesn’t cut it. The only “affordable” car that they now build that is even slightly attractive is the Challenger – a car that steals all its design cues from the 1960’s muscle-car hey-day.

I remember back about 15+ years ago when Chrysler came out with it’s “cab-forward” look  – where they seemed to think they could lead with “style” – like this would cover the other, important things people look for in a purchase they’ll pay for now for 4-6 years – things like reliability, resale value, and “lasting style”. For a time – I had hope they would do it. Now, the market has spoken – and with sales down over 40% from last year, the lines they’ve brought out the last 2-3 years just don’t resonate with people.

Here’s the thing. Style gets them into the showroom – the first time. The rest of the car keeps them coming back. Example – Porsche. BMW. Ferrari. Jaguar.  All these companies build cars that go “beyond” style. Performance and resale value keep owners in these cars, and to a large degree, they don’t rest on their past successes – they keep the brands growing. New designs that break with the past (to varying degrees) – yet still keep customers excited. On the lower end of the price-scale – look at BMW with the Mini, Volkswagen, and any of the Japanese manufacturers. Even when sales are down, they retain their customer base. If style itself isn’t the selling point (i.e. the Toyota Prius looks like a freakin’ toaster) – it’s multiple other selling points.

I hope Chrysler can get their act together. With the concessions that both the unions and lendors are giving them, combined with Fiat’s eventual control of the company – there is a glimmer of hope for them. My fear is – if you can’t make a company work when you’re owned by Mercedes when the economy was good, how are you going to do it when the economy sucks and you’re owned by Fiat?

However they do it – they had better make their cars go beyond “style”. Give us substance as well.

Why the economic downturn can drive good design

We’ve just come out of a time where, let’s face it – the conspicuous consumption of the last 10 years dwarfs what we saw during the 80’s. We’ve had reality shows that show young girls being chauffered in Lamborghini’s to “sweet 16 parties” that cost the same amount of money that AIG employees got (or now, might just get taxed out of) for bonuses.

And, things moved on at such a swift pace, that as long as it was “pretty” – people would buy it. 15 years ago, who ever heard of the term, “Do you speak Prada?”. Now, with budgets scaled back, and people actually taking the time to think about what they are buying – now is actually a great time for products that are built on the concept of “form follows function”.

I’ll use Chrysler vs. Ford as one example. Both companies have, over the last 15 years, built vehicles that are attractive. But design goes beyond “pretty”. Design isn’t just how it looks – it’s how it works. Good design means you don’t have to think about how to use it – you just use it. In the most recent surveys done by Consumer Reports, had both GM and Chrysler at the bottom of the list in reliability, with Ford fourth from the bottom. (USAToday – 27 Feb 09). And, yet, both design cars such as the Dodge Viper, the Chrysler 300M, the Ford Mustang, and even the now discontinued Ford GT – that are quite attractive.

Another example is Apple products compared to…well, just about any competing product. During the downturn, Apple has introduced the new “unibody” Mac’s, the iPhone, new iPods, and now the Shuffle. Sales may have dropped a little, but to hear that Lenovo (which makes great systems, by the way) has had to lay of people at their factories in China – seems to be showing that the combination of good visual design, good ergonomic design, and good mechanical design – are what are becoming key to sales.

Basically, it’s coming down to this – if people are going to spend, they want it to last, and they want to be proud of it. Architect Sarah Susanka has been a proponent for years of smaller spaces, with money spent on the details. Over the last “boom” – the goal seemed to be to buy bigger homes – yet, not necessarily better homes. Last year, for the first time in 10 years – the average square footage of new single-family homes actually fell from 2,629 in the second quarter, to 2,343 in the fourth quarter, according to US Census Data.

We’re seeing a return to common sense. We want more out of less. We want to feel connected to what we have spent our money on. Those who produce designs that help create a long-term emotional bond to the brand, to the product, and to the company that produced them, will be the winners once we rebound out of this downturn.

Corporate Arrogance…maybe this is part of the reason the economy is having problems!

Over the course of the last few days, I’ve read a couple of different news releases and articles regarding recent company downsizings, in light of the current economic turndown. One of them concerns Microsoft. Beyond the train-wreck called Vista, it seems they keep making miss-steps that may be why they’ve announced some pretty extensive layoffs this week – 5000 employees.

One release describes  that some of these cuts include the disbanding of the ACES Studio team which is responsible for Flight Simulator, as well as other games. And another describes that even though the revenue stream from some of these games has been small, it has been positive – while the Zune player that’s designed to compete with Apple’s iPod – has been loosing money. And, we see another case of “We have to show that we’re better than XXX company – so let’s cut those areas that are profitable and use the money we save to throw at unprofitable business units!”.

I now read the following article from CNET- based on an interview with Steve Jobs when iTunes was only 8 months old:

http://tinyurl.com/bgazev

Hmmm…seems Steve was right! Now, this doesn’t mean that Steve is a genius. Yes, Steve believes in both his company, it’s products, and his ability to read the market (and understand his customer). But, that’s the point – he understands his customer! Too many companies spend their time – and their marketing efforts – on telling the customer what they need and want. But, I’d say that the most successful companies (at least for the long-term) – spend their time and efforts trying to figure out a better way to deliver to their customer what they ask for.

When you think of Apple’s designs – whether it’s an iPod, a MacBook, or the iPhone – they take the time to make sure that it’s not just “pretty” – it also delivers to the customer what they asked for.

Starting a new painting – “Last Light”

Now that I’ve finished my previous painting, “Wahikuli Sunrise” – time to start a new one! The next one (that hopefully won’t take too long for me to finish up) – tenatively to be called “Last Light” – is from a collection of images I shot after spending one day this past summer doing a 20 mile hike within Haleakala Crater on Maui. The damn hike kicked my ass, and I made it back to my car at the head of Halemau’u Trail right before sunset.

While driving down the mountaina – I ended up having to pull over and shoot the incredible sunset across the hills above Kula. From these shots, comes the subject for this next painting. Finished size will be 12″ x 30″ – Oil.

So, after one night of painting, I have the basic colors down on the canvas. This is just the beginning – it has a long way to go – but I’m already getting a good feeling on how it’s going to turn out!

Thoughts on things “after the election”

Now that the election is over, and we’re now inundated with the media’s “Obama-mania” – I have been thinking about what all of this really means.

I just read an article on CNN that Obama is planning on “rebranding” the United States. The full article appears at http://www.cnn.com/2008/POLITICS/11/19/obama.world.image/index.html, but the gist of the piece is that although he’s poised to re-brand the United States image in international markets, his actions will have to live up to his rhetoric.

I, for one, don’t think that this is going to go well for him. Simply because I don’t see how anybody, at this point, could do it. The damage we’ve suffered within the international community over the last 8 years has been huge. From a branding perspective, when your brand has taken a hit – even if your customers want your brand to recover, and want to believe in you, turning your brand image around quickly is extremely difficult.

Think of General Motors. Up until the early 70’s, General Motors could do no wrong. They built large, gas-guzzling vehicles that had gobs of power, but were horrible for the environment, and burned through fuel as if it was always going to be cheap and plentiful. Between tightening emissions and a gas crisis in the early 70’s, they tried to turn on a dime, building cars like the Chevy Vega – pieces of crap that rusted on the showroom floors, that broke down constantly, and depreciated to the point of being worthless about the time they drove off the dealer’s lot.

35 years later, GM has never truly recovered. And, they’ve done a wonderful job of repeating their mistakes of the late 60’s – early 70’s – and are now facing bankruptcy without a huge injection of taxpayer money (which is really what a bailout is) – to keep them afloat. Now, yes, I understand that much of their problems are also due to UAW demands driving up labor costs, keeping their cars from being price competitive to other competing brands. But in terms of overall quality – there is still the perception that GM vehicles are not as reliable as, say, a Honda. Even when the quality of their vehicles has improved to the point where they may very well never break down.

Does this mean that people want GM to fail? No. But they’ve had 30 years to turn around their brand perception, and they’ve had the help of some of the best marketers in the business. Obama – he has 4 years – or less – to turn around the United States brand position. And, he also has to focus on our wars in  Iraq & Afghanistan, an economy in crisis, all while fulfilling the expectations of every voter that believed his promises enough to vote for him.

As a country, I think it’s in our best interest to support our new President. But, it’s not just his responsibility to improve our country’s image overseas. It’s our job too. A 2002 National Geographic study indicated that nearly a third of young Americans could not locate the Pacific Ocean. So, go learn a language. Learn about another culture. Befriend someone that you might have just met from another country – and learn about their experiences growing up somewhere else. And, if you travel overseas – be humble – and appreciate the country your visiting – learn from  it, and bring the best of it back here. Our country was built by people that brought their culture here – let’s show the rest of the world that we can still learn from them, rather than impose ourselves on them.

It might just make Obama’s job a little easier.

A Great Idea for Letting People Know About Your Business

I just found this video for Fitness4Home Superstore here in Tempe – showing how to use a treadmill. When it comes to leveraging the power of social media, how many businesses could go and take a video with a Flip camera, and upload videos to YouTube? Just a great way to give out information without seeming “sales-y”, while promoting your business.

Why do American car manufactures design such ugly cars?

It seems that time and time again, American car manufacturers force on the buying public, some of the ugliest cars known to mankind. Don’t believe me? Two words for you – Pontiac Aztec. This abortion-on-wheels had to have been one of the worst excuses for “design” that the motoring public has ever known.

Pontiac Aztec

I remember that one of the major car magazines (I’m thinking it was Automobile Magazine) – did a pre-production road test of this car – and totally ripped it. They went so far as to tell GM that this would be a huge mistake to put on the road. GM had tried to make a minivan into a minivan/SUV crossover…like we really need that. It also had the look of “designed by committee” – where a designer was assigned to design, say..a fender. Another – the front grill. And, in a horrific example of silo-management, combined with political protectionism – no communication seemed to take place between designers, creating a hodge-podge, disjointed combination of angular panels that screamed “drop something heavy on me – just so I don’t look this bad!”.

Yet, when these same manufacturers put their mind to it, they can also design some of the most beautiful cars we’ve ever know. Cars like the current Ford Mustang, Chevy Corvette, and many of the new Saturn line. But what bugs me is cars like the new Pontiac G8. Which is really a Holden (a GM subsidiary – in Australia). The new Saturn Aura – which is really a Opel (a GM subsidiary – in Europe).

It’s not that we don’t have good designers in this country – we do. One example that comes to mind is a gentleman that designed a car that almost 30 years later – still looks modern. When this car came out, it was the mid-late 70’s, when we were getting American cars like the Pinto and the Vega – yet, Tony Lapine (and American designer) – came up with the design for the Porsche 928.

I think the big problem – is most of the American car manufacturers are run by accountants – people who love numbers, not design. It’s hard to cost-justify prior to product launch, why an attractive design will sell more – and be more profitable – than a basic design. And, with the focus the past 30 years (emphasis on each of these varying, but still important nonetheless) – on fuel economy, reliability, and safety – all of these things add costs to the price of the car – so the places we see cut back on are areas like the quailty of interior materials & related design, for example.

Yet, we’ve also seen what happens when bean-counters run these companies. Mercedes-Benz – once the epitome of quality – decided it would be more profitable to cut cost out of production – and reliability suffered, killing sales. So, there is a valid argument that cutting design won’t hurt sales like cutting production & manufacturing costs. Additional proof of this is most of the cars coming out of Japan (and now South Korea as well) – these cars aren’t known for being…well…beautiful – but knowing your Honda or Toyota will rarely break down – is important.

Yet, the problem remains. Cars – especially American cars…are usually pretty bland, if not downright ugly – unless you spend over $50K. Why is this? Does it really cost that much more to make a car that’s beautiful? Especially if you’re trying to compete against other foreign brands that are attractive, reliable, or both?

I think part of the problem is – many of these companies are entrenched in their own design philosophies. And only rarely venture outside of them. Example of stepping out? Cadillac. Now, I’m not a Cadillac fan. Many of the parts are really from a Saab – and I’d rather have one of them. But, they took a step into a new design philosophy about 8 years ago – and look at what it’s done for their sales! And…an example of not stepping out? Buick. They have this stupid philosophy that says that the front fenders of their cars must have 3 portholes. Because they did 50-60 years ago. OK…if you’re target market is people in their 70’s – great. Once they are gone…so is your brand. Simple truth – innovate or die!

Of course…that brings me to my last point – maybe they design ugly cars…because people buy them anyway? How else can you explain why people would order a Buick or Cadillac…with a fake vinyl top that looks like it would be a convertible..but isn’t?

Social Networking – Is It Relevant?

I was just reading an article in 1to1 Magazine  – called “The Social Media Hype Is Over” – basically, they feel that it’s time to create real value from online customer interactions. Beyond being today’s buzzword, social media has taken our job as marketers, and thrown us on our collective asses.

We started out with the Internet – a nice, controllable vehicle to get our message out. Then, we started corporate blogs – which gave us the ability to get closer to our customers, while getting feedback (good and bad) – but we still retained some control over the “message”. Now, with the growth of social communities such as Facebook, MySpace, LinkedIn, etc, – we no longer control the message – our customers do.

The question we keep asking ourselves (or, get asked by our bosses / clients / customers) – is whether social networking is really relevant?

Short answer – if you think for a second it’s not – it’s time for a new career.

I’m thinking of a kayaking trip with friends in the next few weeks. I’ve communicated with my friends to plan the trip over Facebook. I read reviews of different tours on Yelp. One company – has a blog where i read up about the last few trips they’ve headed up for clients. I’ve checked out trips taken by other customers on Flickr, Photobucket, YouTube, and Picasa.

In the past, I’d had just called the company, booked the trip, and hoped for the best. Yet now, with a tightening economy, I want to know what I’m getting prior to the trip – and I want to know what others think.

The opportunity for us as marketers – is to realize that as costs go up, for us to ignore our clients desire to research what they are getting for their money – that the less we do with marketing over social networks – the more our customers will do it for us. I realize that I’d mentioned above that the customer controls the message now. This isn’t totally true. They interpret what we put out there as our message – and then do some of our marketing for us.

Our job – is to make sure the message is more accurate than ever before – and, make sure that we stay on top of that message. Then, utilize these social media tools to make sure our customers know about our message. Finally, once we’ve accomplished that – we then need to stay on top of what they say about our message – how they interpret it and market it – so we can constantly make course corrections in our message.

I like to think that in some ways, we’ve simplified some of our market research via the introduction of social networks. Think about how many blunders have taken place over the years because what a focus group said was important, was irrelevant once brought to market. Now…you’re going to know the relevance to the market that much sooner, and possibly more accurately, than ever before. We now have the ability to monitor our brands in real time – for better or worse!

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Airlines & Marketing

It always amazes me how some industries think that if they market things a certain way, people are too stupid – or gullible – to see the truth. (Or…is it that the consultants they use look at their customers this way?)

Case in point – the airline industry. Currently, oil is trading at nearly $150 / barrel. Double what it was a year ago. Planes use fuel. So, it would be reasonable for me to expect airfares to rise across the board.

Instead, the airlines have decided that to remain “competitive”, they’ll keep airfares down by raising their fees for other things, as well as eliminating some services. Northwest announced today that they will now charge $15 for the first bag – due to rising fuel costs. Hey – guys – whether it’s you, American, or any other airline that’s decided the “first bag fee” will be a great way to offset costs – how about you just raise my ticket $15!!

When I’m traveling, the last thing I want to deal with at check in is “oh…you have a bag – whip out your credit card so we can now charge you more money”. I expect fares to go up. Thanks to TSA’s security protocols, I have no desire to drag my crap on-board anymore – I already hate taking off my shoes while smelling the socks of the dude next to me that has an aversion to showering, while waiting for the family of 300 ahead of me to collect their kids, shoes, laptop, toys, etc. and get the freakin’ hell out of my way!

So…why do they think they’re fooling me? Is this to keep the all-important business traveler who travels in & out in one day with no bag? With companies cutting back on travel costs anyway – do they think this makes a huge difference? Why not raise everybody’s fare $15, collect the money from EVERYBODY, and allow everybody to catch their damn flight instead of getting stuck at check-in with more bag charges?

Southwest has it right. They’re marketing their fares with “we don’t charge for this / that / everything else – we make it simple”. Maybe that’s part of the reason they have such customer loyalty – rather than just cheaper fares?

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“Harbor Morning” is finished!

After a number of months working on “Harbor Morning” – it’s finally finished!

Oil – 2008 | 24″ x 36″

View from Lahaina Harbor, looking across the boats toward the island of Lana’i.

Click on image for larger view