2.232009

wasted potential — saturn

Saturn joins the ranks of formerly esteemed brands like Vonage and Dairy Queen in this series on brands that have failed to live up to their potentialWhile practically every domestic automotive brand seems to have fallen short of consumer and/or investor expectations lately, I picked Saturn because the brand clearly had (has?) so much potential and so the stakes seem higher.

Remember back in 1985 when Saturn first launched?  The company was positioned as not just a different kind of car — but “a different kind of car company.”  Company officials explained their singular focus on the people who buy and drive cars.  They instituted a “no haggle” policy at their dealerships; their advertisements expressed the uniqueness of their brand platform.  The company even entered into a groundbreaking agreement with their union workers.

The Saturn cars themselves won all sorts of awards and, more importantly, fanatically loyal customers.  In 1992 Saturn achieved the top rank of new car sales, the first time a domestic brand topped the list.  In 1995 Saturn was ranked #1 in J.D. Powers’ Sales Satisfaction Index Study, a position it would hold for 4 consecutive years.  As testimony to the equity the brand enjoyed, Saturn “homecomings” became legend.

Then Saturn’s parent, General Motors, started to falter.  They cut investment in Saturn,  creating a downward spiral of limited new models and limited marketing spending — so much so that the division was integrated back into GM, despite the leaders’ original promise to operate it separately in an attempt to nurture the brand and shield its operations from the rest of the company.  (Read more of Saturn’s history here.)

After a series of failed new model launches and incongruous brand positionings, G.M. announced last December that it was “exploring alternatives” for Saturn — basically they are looking to sell it or relegate it to a much smaller role in G.M.’s lineup.

Recently an interesting possibility developed:  Saturn dealers are making a move to spin off as an independent distribution arm of the company so that they can sell other automotive brands.  While this may give the impression the dealers have given up on Saturn, it actually might save the brand.  As Martin Bishop, Landor‘s brand strategist and author of a great blog, explains, “It’s the dealership experience that has always been the true differentiator for Saturn…So to create a new business that focuses on the dealerships and allows them to source cars from different manufacturers makes a lot of sense. It plays to the real strength of the brand’s equity.

Who knows what the future holds for Saturn.  As someone who believes in the power of brands, I certainly hope the company can turnaround the current situation and reclaim its leadership position.  But in the words of a fellow blogger Nigel Hollis (Chief Global Analyst with Millward Brown, the market research company), “In 1994 people bought Saturn for what it stood for. Today it is just another make to be judged on quality and price alone.

That’s why Saturn is this week’s brand disappointment.

, ,