Did you know that a car can get you from one place to another?
That message may have been lost lately, what with car commercials so focused on their high-tech offerings that it would seem going for a drive is like living inside an iPad.
There are ads demonstrating gee-whiz technology - vehicles that park themselves, others that show a hands-free Facebook status update or an onboard entertainment console that automatically syncs with a driver's mobile phone - and even one or two spots that seek to position the latest generation of cars on a continuum of scientific breakthroughs reaching all the way back to the discovery of electricity and then forward to this season's hot mobile devices.
Touting technology has become the car industry's latest moon shot for grabbing market share. Last summer, Nissan kicked off a campaign promising, "Innovation for all." Toyota is operating a contest known as "Ideas for Good" that asks consumers to come up with new non-automotive applications for some of its proprietary technologies. And Hyundai is currently in the midst of rolling out its own new innovation-oriented tagline: "New thinking. New possibilities."
Ford may be making the biggest bet of all on innovation, trying to position it as the core of its new brand. "Thirty-two per cent of consumers are buying our vehicles today for one reason: because of our technology," said David Mondragon, chief executive officer of Ford Motor Co. of Canada, who spoke on Wednesday at a conference organized by the Canadian Marketing Association.
"The whole area of innovation, it has been a somewhat ubiquitous theme over the last 12-18 months," explained Chris Travell, the vice-president of the automotive group at market researcher Maritz Canada, which counts most of the domestic car companies as clients. "The manufacturers are wrestling - they use that term - for the white space, and innovation has been seen as the white space."
Referring to Silicon Valley's shiny, happy brand, he said of the car companies, "They're borrowing what's going on in California."
But here's the odd thing: On the whole, car companies aren't pitching these smart cars to those with deep pockets; rather, they're making a play for the low-margin first-time buyers.
Among its many other innovations, Ford Motor Co. has integrated Sync, a Windows-based system that enables hands-free operation of entertainment functions and phone calls, in 80 per cent of the cars that it sells, including many of its entry-level models.
"The drive behind this is seamless communication for consumers, especially young consumers," Mr. Mondragon said. "The biggest turnoff to a twentysomething consumer is to put their life on hold when they sit in a car. And what does it mean to put their life on hold? To get disconnected when they get in the car, to have a system that will not allow you to sit there and e-mail, read your BlackBerry, talk on the phone. So you have to have a seamless transition from your home to your transportation device, to your workspace. Or to your play space."
"Our vehicles are becoming much more than a transportation device," Mr. Mondragon added. "They're communication and entertainment devices."
To get a sense of the importance that brands are placing on technological innovation as a differentiator, take a stroll through this year's Super Bowl ads. One spot for the Chevrolet Volt provided a short history of breakthroughs (Benjamin Franklin's experiment with a kite and a key and a lightning bolt; an early model black-and-white television; a NASA rocket launch; a Jimi Hendrix electric guitar riff; ending with the development of the electric car). Another for its sister brand, the new Chevy Cruze, featured a young man who, while driving away at the end of a date, checks his Facebook news feed through GM's voice-activated OnStar data system, and learns his date has posted an endearing message for him.
An ad for the Hyundai Sonata hybrid gently mocked people who settle for old technology (unicycles, the video game Pong, cellphones the size of a small baguette) rather than embracing recent innovations. And the most popular spot of the Super Bowl broadcast, Volkswagen's "The Force," offered viewers an adorable snapshot of a six-year-old Darth Vader wannabe, while quietly promoting the Jetta's keyless ignition.
The ad buys are reflecting a shift in technology, too.
When Ford wanted to unveil its 2011 Explorer, it did so on Facebook. Mr. Mondragon noted that, in 2005, 92 per cent of the Canadian company's marketing media budget went to mass outlets; in 2011, that figure will drop to just 60 per cent. (Its magazine and newspaper spending will be only 6 per cent, from 22 per cent in 2005, though TV is hanging in, down from 61 per cent in 2005 to 50 per cent this year.) Meanwhile, spending on Internet advertising will consume 28 per cent of its media budget this year, up from only 4 per cent in 2005.
In an interview following his presentation, Mr. Mondragon outlined other reasons to use technology as a lure for twentysomethings. "Those are the ones that haven't stepped in the showroom, because they saw the products their dad and mom were driving and they didn't want to touch those vehicles. Now, when they come to the showroom, they not only see the freshest lineup, but they see a car company that understands their wants and needs. And has adapted technology to support that."
Ford has discovered that its most effective marketing is done by its own customers. "We had to democratize [the technology such as Sync]and take it across all levels of product," Mr. Mondragon said. "The worst thing we could have done - and traditionally companies have done - is said, 'Okay, we're going to bring that new Sync technology, and we're going to put it in the high-end vehicles, and then the average consumer can't consume it or afford it.'"
By making that technology available to those who are especially active on social media, Ford has succeeded in co-opting its customers within that demographic to become influential evangelists for its brand. Which is great for the company, of course, unless somebody tweets while driving and ends up in a ditch.