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The automotive industry was "running on empty" in 2009 as sales plummeted. General Motors and Chrysler needed U.
The automotive industry was “running on empty” in 2009 as sales plummeted. General Motors and Chrysler needed U.S. government bailouts to survive, Toyota was plagued with product recalls, the recession was in full swing necessitating “cash for clunkers” programs and federal sales tax incentives to stimulate the purchase of new vehicles. One notable exception in this dismal marketplace was Subaru of America.
Subaru has emotionally connected with its highly educated, environmentally conscious and outdoor enthusiast target market by providing well built, reliable vehicles that consistently win “Car of the Year” awards by R.L. Polk & Company, Motor Trend, Edmunds, Cars.com, National Highway Traffic Safety Administration and other organizations.
“Subaru will consistently build customer loyalty, create customer advocates and strengthen brand value by providing superior purchase and ownership experiences” (Subaru Customer philosophy). Consider this interesting anecdote about Subaru quality. A customer with nearly 300,000 miles on his vehicle (200,000 + is not uncommon for Subarus) was unable to start his car. He contacted the service department and was asked if he had a spare key. He did and was told to try starting the engine. It worked – apparently, the car was fine but the original key was worn out!
Subaru’s recent promotional theme “Love, It’s What Makes a Subaru a Subaru” has reinforced brand loyalty to meet the company objective of creating lifetime customers. Subaru, a niche marketer that sells more 500,000 units annually in the U.S. and 1 million cars worldwide (2016 estimates), has one of the highest repurchase rates in the industry.
Questions
- 1. What is unique about the Subaru customer focus that competitors are unable to match?
- 2. Comment on how Subaru loyalty differs from typical customer loyalty in the automotive industry?
