In 1985 the Nissan Corporation sent a group of its engineers to live in the United States. The idea was to learn about the sorts of features the luxury car buyer wanted. At the same time Nissan strategists were monitoring the environment.
By 1988 a clear picture was emerging. The relatively young upscale segment that was 7% of the population was no longer buying the most expensive watches, cars, suits, and antique furniture. Economic conditions, including the consequences of the stock market crash and expected recession dampened enthusiasm for the most expensive product offerings. This disposition was also fueled by the fact that this young upscale group was vested in family matters, with over 60% having kids. The consequence was the emergence of a value orientation.
At the same time another trend was emerging among this upscale segment. It was time famine. In the 1980s leisure time was down from 21 hours per week to 16. Work hours were up from 41 to 47. Exercise, education, community were all important. People were coping with time famine by converting process into experience. The process of commuting, for example, became the business of communicating with the aid of car phones, and portable FAX machines.
Nissan's response was to design a luxury car that offered good value. While this might have been achieved by producing a car that was at parity with European luxury cars, but lower in price, Toyota had taken this position with the Lexus. A new concept of luxury and value was needed if Nissan was not to be a me too player.
Nissan addressed this issue by developing an ergonomic concept of luxury in the Infiniti. The car would be aerodynamically superior to its competitors, with special attention to human engineering. The door handles were huge and inviting. The seats were hard leather to enhance support rather than the more usual soft leather than felt nice to the touch. Pressing Infiniti's buttons was a pleasurable experience, but the car had no grill. To address the value question, Infiniti was priced about $20,000 below its European competitors. And time famine was handled by providing a service package that included picking up the car for service and leaving a comparable car with the customer while the service was being done.
By early summer of 1989 the advertising task became clear. Promote a new concept of luxury for a car without a grill and huge door handles during the slow November sales month and three months after Toyota introduced Lexus.
In late October Nissan Motor Corporation aired an unconventional prelaunch campaign for its line of Infiniti automobiles: the flagship Q45 sedan and the M30 performance coupe. The Zen-like advertising developed by Hill, Holliday, Connors, Cosmopulous shows rocks and trees that were accompanied by philosophical copy. No product shots were included. The uniqueness of the copy, as well as a heavily front-loaded national expenditure of more than $60 million, propelled the awareness of Infiniti advertising to the number one position among all product categories by the November 8 introduction.
RANK IN AD AWARENESS
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In addition, it was claimed that in the first two months 60,000 people called for information, 35,000 people visited the showroom, and there was about 80% awareness of the Infiniti marque. Yet sales lagged behind goal. By December 31, 1989, 1773 cars had been sold -- or a rate that would produce annual sales of about 12,800. This was far below the 30,000 a year target for Infiniti set by Nissan.
As ad awareness began to fall in January 1990, the decision was made to introduce the second generation of ads. It featured the nature scenes used in the first generation interspersed with product shots. While this prompted improved awareness, sales continued to be sluggish. Sales for the first quarter of 1990 were 3700.
In April under a new creative director, Dan Mountain (and with a budget that was now in excess of $100 million), the third generation of Infiniti ads was launched. This generation was more conventional in featuring product shots with voice-overs to reinforce the visuals. And David Hubbard, Infiniti's national ad manager noted, "We all would have liked to stick with the nature campaign, to do more with it, but when research comes in and it says you've got tremendous awareness out there but you've got a problem in the sense that nobody knows where your product fits in ...then you've got to adjust to meet that need. That's marketing."
Question: Provide a compelling rationale for the introductory ad campaign. Then provide a more balanced assessment of the strengths and weaknesses of the different campaign stages. And, more generally, develop a position about the role of advertising in the automobile industry. Is it supposed to sell cars?