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VW in Detroit?

This American Life just solved Volkswagen’s Branding PR debacle free of charge.

I’ve been thinking about VW’s diesel fraud a lot lately. Why? Because I was one of the VW faithful – one of the tribe. I drive a VW Jetta TDI and have felt betrayed by a friend. And every day that I drive my car I wonder if the person behind me at the stoplight is looking at the “TDI” emblem and shaking their head thinking ‘you poor sap.’

My interest has also been sparked by attending some Branding Seminars at our local business center, The Enterprise Center of Johnson County, and following classes on Marketing and Branding on Coursera, specifically ‘Brand Management: Aligning Business, Brand and Behavior, by the London School of Business’ Nader Tavassoli.

For Tavassoli’s class we had an assignment where we were to look at a brand we were interested (typically that of the company you work for, but in my case, VW) and ask people what they think of the brand in one word (apparently a mantra of Brand managers is: Distill, distill, distill). Fortunately for me, I don’t even have to go looking for answers. Every time I open the paper there’s an article like this one on the correction that VW is going to be using in new cars going forward. Every time I listen to the news on the radio, I hear reports like the All Things Considered report I mentioned in my last post.

So, what words are people using today to describe Volkswagen? Fraud. Liar. Arrogant. Mistrust.

What other companies have faced PR debacles like this and survived (or not) in the past?jack

  1. TylenolI talked about this one before. The message here being that if you get in front of the problem and make your product even better than before, you can come out on top.
  2. Ford Motor Company – Remember the Pinto? The New Yorker just did a brilliant piece in The Engineer’s Lament.
  3. Nixon – well. There might not be a lot to learn here, but the country did recover once Tricky Dick resigned. Sometimes heads have to roll.
  4. Jack in the Box – This one got used in the This American Life piece – and, I’m not sure if I can really get behind their decision to take the offensive. Let’s just say that there are various solutions to any given problem.
  5. Bridgestone Tires – Tread separation led to as many as 200 deaths and 700 injuries.
  6. GM, Ford, and Chrysler CEOs– We learn that sometimes it’s a bad idea to fly your private corporate jet to Washington DC to ask for $25 Billion in bailout funds. In this case, the shaming was personal and was ‘rectified’ by driving hybrids to all future government meetings.

#6 doesn’t really fit the mold of brand problems, but it was a PR problem for these CEOs. Why? Irony. That’s why. And this is the problem that VW is facing: VW’s brand was built on Trust. When Nixon lost the country’s trust, he had to resign from office. There was no saving his brand. People like to see perpetrators pay for the problems they cause.

#1 – Tylenol. That had irony too. A medicine that kills. There was a good chance that it would be the end of that brand, but instead, they doubled down and said, ‘Not only are we going to make our product safer. We’re going to make all medicines safe.’  What could VW learn from this? Perhaps incorporating software to make the driver aware of their car’s emmissions just as many cars now show instantaneous MPG readings. Perhaps by inventing a product that can improve all diesel engines. Perhaps by bringing in a third party regulator to ensure that all VW standards are upheld across the board.

Then…

Today, while raking leaves from the front yard, I listened to the new This American Life podcast by Ira Glass that brought up the problem of VW’s brand. And, as fast as that, they solved it by going to ad execs and asking for ways to stop the bleeding of trust. 1-2-3.

  1. Invite an outside group to do some ‘All Access’ reporting on the way that VW goes to solve its problem.
  2. Crowdsource the solution – and keep their mouths shut and their ears open (my least favorite idea)
  3. Move their headquarters to Detroit, Michigan, own the problem and make a solid investment in a city that needs it right here in America (my favorite idea – it’s a big one, and costs a hell of a lot – but at least the property itself will be cheap)

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Posted by on October 14, 2015 in Uncategorized

 

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He’s going on about branding again….

I drive a VW Jetta TDI.
The TDIs are interesting cars in the US because they use diesel engines rather than gasoline. Diesel has long been used in cars and trucks, but it was dirtier and louder than gas engines. Recently, however, diesel has made a comeback with the advent of high milage ‘clean diesel.’ VW has been a big promoter of this trend offering TDI models of many of its cars.
We’ve been happy with the performance of our car for the past six years in many ways. It isn’t loud, like earlier diesels, it gets great milage (typically around 40mpg) and it has a lot of power for a small engine.
Then the news broke.

VW was found to have manipulated its onboard computer in a manner than outmaneuvered emissions tests. How is VW going to solve this problem? This meant that it wasn’t as clean as it was thought to be and owners are now wondering whether fixing the emissions problem will hurt the milage or performance of their cars. Also, will resale values plummet?

NPR’s All Things Considered looked into this with a number of TDI owners…
http://www.npr.org/player/embed/444719948/444790918

From All Things Considered, “Volkswagen owners wonder where a fix will leave them”
Previously, I’ve talked about brand image and how this scandal will affect VW’s brand identity. Judging from the NPR clip, a number of TDI owners are struggling with the same thought. None of them – or rather, us – want to drop our identity with this brand so quickly. And this pause gives VW a moment to make it’s move to save the brand.

And, at this moment, the brand is what’s at stake. Business is important, but short term planning could kill the long term prospects for the company.  Will the company listen to short term investors that have been dropping the stock:

Screen Shot 2015-10-01 at 9.01.41 AMOr, will they take a long view and rescue the brand at the expense of short term profits?

In the news article above, Steve Berman is a lawyer who filed a class action lawsuit on the day of the news and has since had 8000 inquiries about the case.

Already, the window of opportunity is closing of VW. It needs to look into itself and ask, what is it about us that has made us successful? What is our brand about?
Originally conceived as a ‘car for the people’, VW offered a sturdy, dependable car for an affordable price. VW has cultured a brand over many decades to target customers who think of themselves as slightly out of the mainstream. These are customers that want their brand to be something they can be proud of – they (we) are a tribe.

The solution is for VW to own this problem.Regardless of price, it should devote itself to implementing a fix that does several things:
1) reassure its customers (the tribe) that the company will make it right . Then…
2) control emissions
3) maintain gas milage
4) maintain power
-or-
If 2-4 can’t all be done with these cars, then it should offer to take/buy back the cars (which it could fix and then resell with whatever hit to 2-4 is necessary) and replace them with a refined model that does provide a real fix. And it should do this at cost or below. It doesn’t have to be free. Killing the company doesn’t help anyone. But it should not be making money on this either. After all, the short-term stockholders are already gone. A quarter – or two, or three – without profits is acceptable in order to keep VW customers coming back in the future with the knowledge that they can rely on their tribe’s leaders to take care of them.

 
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Posted by on October 1, 2015 in Uncategorized

 

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Creativity and Regression to the Norm

Creativity

I was listening to Stuff to Blow Your Mind’s War on Creativity (a cute play on the War on Christmas, which I had to stop the podcast to explain to my son) today in the car.

This episode asks why it is that we say we value creativity and that businesses want to bring it in-house, but very few businesses actually act like this is something it wants. Creativity is disruptive, it requires risk-taking, and it often results in failure.  Yet, no one hits a homerun by playing it safe.

Regression to the Norm

This is the phenomenon where new, statistically significant observations tend to evaporate upon re-examination. The now defrocked Science writer at The New Yorker, Jonah Lehrer wrote about this back in 2010   in an article describing the diminishing effects of psychiatric medications over time – meaning that the experiments actually showed these medicines to have less potency every time they were tested – not that they are less effective for a particular person over time. Lehrer explains that a lot of this may be the way that we involuntarily allow confirmation bias  into even the best designed experiments, and over time, as investigators with less personal investment in the results repeat the same work, they lose the confirmation bias and subsequently see less convincing results.

I would argue that the same effect occurs in design. It’s something that I’ve always personally thought of as the Taurus Effect. I propose this to mean that there is the occasional breakthrough in unique, engaging design, but this gets co-opted by the more conservative elements of the business who (not to mince words) suck the life out of these designs bit by bit until there is nothing left. In this way even the most unique, exciting automobile design eventually gets eroded into the most boring of all cars, a 1999 Ford Taurus.

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Consider the Camaro, one of America’s most iconic muscle cars. What starts as great design gets whittled away year after year into what I assume must be more and more aerodynamic designs that completely abandon any semblance of cool.

Another icon of American Design is the Chevy Malibu. This car started as a mean hunk of metal that demanded to be noticed. By the 1980s it way reduced to … well, not a Taurus, but something possibly worse.

malibuA lot of these cars have seen a renaissance with the introduction of new designs that can only have been inspired by real designers, not committees of businessmen and engineers hell bent on perfect aerodynamics.

Last week, however, I was at the Chevy dealership to get work done on my truck when I noticed the new 2014 Camaro. At first, I only saw it from behind and thought, ‘is that a Ford Taurus?’

Welcome back to the norm, Camaro.Image

 
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Posted by on January 21, 2014 in Uncategorized

 

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“Greed is Good” -or it least it feels that way to some people

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Hey buddy, watch the paint!

An interesting article appeared in PNAS, the Proceedings of the National Academy of Science, last year: “Higher Social Class Predicts Increased Unethical Behavior.” Thank you to Xenophilius for posting a link to this. Basically, the paper reports the behavior of motorists based on the ‘status level’ of the car they drive. “[W]e used observers’ codes of vehicle status (make, age, and appearance) to index drivers’ social class.” Unfortunately, this is all that was said in the article and its supplementary material about how ‘vehicle status’ was calculated.

I can’t say that the results of this study are surprising, but it does provide some support for the feeling that people in ‘rich’ cars act more callously towards people than those who drive more common vehicles. The data presented here shows the likelihood of a car yielding to a pedestrian at a crosswalk (something mandated by California State Law.Image

 

I have always remained convinced that BMWs are the only cars on the road where blinkers come as optional equipment.

 

 
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Posted by on July 25, 2013 in Uncategorized

 

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