Japanese car and motorcycle makers are saying they are halting production at least through midweek next week because of the disaster in Japan, and the crisis at the Fukushima Daiichi nuclear plant. It is unclear what this will mean for the U.S. auto, motorcycle and recreational vehicle market, because manufacturers themselves don't know when factories will ramp up operations. Kelley Blue Book notes that with gas prices on the rise, any interruption to Japan's production capacity could have far-reaching consequences in the United States, including higher prices for Honda, Toyota, Nissan, Subaru, Mazda, and Suzuki vehicles. Toyota, which will be down at least until March 22, says it has already lost production of 40,000 vehicles. Honda has done likewise while Nissan and Mitsubishi have resumed operations. Kelley Blue Book says if production is resumed fairly soon, the overall impact to the supply and ultimate price of Japanese vehicles should be relatively minor, even if the downtime lasts two to three weeks. The firm says Japanese automakers are at an average of 61 days-supply of inventory, which is considered average, "so in the short run, it appears as though there are enough vehicles on dealer lots in the United States to withstand a short-term production cutback." But if shutdowns last a month or longer, supplies of vehicles from Japan could tighten, raising prices. "Perhaps most impacted will be the price of fuel-efficient hybrids and compacts, which already have seen an increase in demand as gas prices have been on the rise," says KBB. The firm says that would cause prices to rise for such vehicles made by Hyundai, Ford, GM and others who would "see increased sales as a result of the reduced supply of Japanese imports." But there are more questions than answers -- what with power outages, damage to Japanese infrastructure, and the potential for a meltdown at Japan's Fukushima nuclear plant. Kelley Blue Book said it expects incentives for many Japanese vehicles to stay strong, "so now might be a great time to try to get a deal on a Japanese vehicle while there still is sufficient inventory," as a shortfall of Japanese-made vehicles will mean price increases across the market, according to Juan Flores, director of vehicle valuation, Kelley Blue Book. Meanwhile, although Japan's motorcycle industry may be a much, much smaller sliver of the auto market in the U.S., its problems may be more acute, as few Japanese motorcycles are manufactured here -- and the sector, which is discretionary in the U.S., has been battered by the economy. Also, we are just entering the season when people start heading to motorcycle dealerships. Fran O'Hagan -- president of Pied Piper Management, which practices market research on different market sectors, including motorcycles -- says it's a bad time for Japanese motorcycle brands to have supply problems, as they have just started seeing improvements. "It's been a used-motorcycle market. Sales stats have been pretty hard to come by and I suppose the reason for that is they show a lot of bad news. If we totaled up year-to-date sales, I'm guessing it's around 50% below where it was three years ago. Even back when times were good in the industry, it was still not easy to earn a good living through motorcycle dealerships. When sales drop by 50%, it makes it impossible." Among major Japanese motorcycle companies, only Yamaha seems to have avoided serious plant damage. Still, the company says it is halting production until around March 23 at five factories that make outboard boat motors, personal water craft, auto engines, and ATV and golf car engines. Honda says it has shut down production at six plants through March 20, including the motorcycle-producing Kumamoto Factory. Honda has also shuttered its motorcycle production facilities in America. Suzuki says it has stopped manufacturing at six plants, including the Takatsuka and Toyokawa facilities. The former makes motorcycle engines, and the latter makes and assembles the motorcycles. Officially, Suzuki says it is extending the delay at least through March 17. Kawasaki said its Akashi plant is 400 miles southwest of Sendai, which is near the quake's epicenter. "Fortunately, the Akashi/Kobe area where Kawasaki offices and factory are located did not experience any direct effects from the earthquake," said a company release.
The Home Depot is getting ready for its own version of Black Friday. For the second year in a row, the DIY heavyweight will roll out regional promotions that include doorbusters, as well as special pricing on lawn and garden, patio furniture, and grills. The company launched the idea last Spring, and this year is expanding it to include 60,000 seasonal associates trained for four different weekend events, beginning this weekend. Participation varies by market and climate. "Spring is our Christmas," Craig Menear, EVP/merchandising, says in the company's release. "We want to give consumers the best value possible to meet all of their indoor and outdoor needs." The Atlanta-based chain also says it will post Black Friday-type offers on Facebook every Friday through the end of May, and that these Facebook exclusives will include discounts of as much as 50 to 75% off. Chains like Home Depot, Lowe's, and Sears are likely hoping this year's spring results will be greener and less grim. Gardeners were still recession-wary last spring, and the latest National Gardening Association survey found that while overall participation in one or more types of do-it-yourself lawn and garden activities increased by 2% to 83 million households last year, spending dropped 18% to $363. And total retail lawn and garden sales fell 16% to $30.12 billion last year, the lowest level it has reported in over a decade. Food gardening was the only growth segment -- up 21%, and gaining for its second year straight. The good news, that survey says, is that declines in gardening spending were less than those in other discretionary categories, and there is still plenty of green-thumb enthusiasm: "There were many more people who increased the amount of time they spent on food gardening, lawn care, flower gardening, container gardening, and yard/landscape care than people who decreased the amount of time spent on those activities last year." Gardeners' favorite money-saving strategies included using water wisely, buying plants on sale, growing plants from seeds, mulching landscape and garden plants, and mowing the lawn at a taller height. The biggest casualty, it says, may be residential lawn and landscape services. "From 2006 to 2009 the amount consumers spent to hire lawn/ landscape maintenance, landscape installation/construction, landscape design, and tree care services declined by 44% from $44.7 billion in 2006 to $24.9 billion in 2009," the survey notes. Most of the consumers in the survey say they plan to spend at least as much on their yard as last year, except in the lawn and landscape area, as well as somewhat more in food and flower gardening.
For the first time in several years, an American auto brand has topped the J.D. Power & Associates Dependability survey-based study. And for the first time ever, Ford's Lincoln brand has done it -- besting Lexus, which is in second place. After Lexus are Jaguar, Porsche, and Toyota. The Porsche 911 sports car has the fewest problems in the industry, per the study. While Lincoln takes the top score in overall brand dependability, Toyota Motor wins the most awards by vehicle segment -- seven in all. Domestic brands have closed the gap with imports in J.D Power's other benchmark study on initial quality -- which measures problems after three months of ownership, but not so much on dependability, which looks at vehicles that were bought new after three years of ownership -- in other words, after having been purchased in 2008. Since then, domestics have steadily improved in three-month initial quality scores, which suggests the dependability gap will follow suit. And that score matters a lot when it comes to loyalty, per J.D. Power, which says that as the time of ownership stretches out, durability has an increasingly greater relevance to how much owners spend on service and how loyal they are to the dealership service bays. "As the number of problems experienced increases, owners are increasingly likely to use non-dealer service facilities for paid service work," says the firm. "In addition, as the number of problems increases, the percentage of owners who say they 'definitely will' return to their dealer for service diminishes." Among owners who indicate they have experienced no problems, 76% said they 'definitely will' return to the dealer for paid service. That number drops to 42% among owners who say they experienced six or more problems. Across all automakers, vehicle dependability has improved from last year, per the study, which measures problems experienced during the past 12 months. Based on responses from more than 43,700 original owners of 2008 model-year vehicles, it measures 202 different problem symptoms and then rates dependability on the number of problems experienced per 100 vehicles. A lower score reflects a higher quality. The firm says that this year overall, vehicle dependability averages 151 problems per 100 vehicles (PP100) -- the lowest problem rate since the inception of the study in 1990. That is an improvement from 170 PP 100 in 2009, with a 6% annual improvement since then. That improvement rate is slightly lower than 8% annually before that. The firm says the reason for the slower rate of industry improvement in dependability is increased rates of problems with electronic features in vehicles, including audio, entertainment and navigation systems and new safety features, such as tire pressure monitoring systems. "Automakers, as a whole, have made significant improvements in reducing traditional problems, particularly with vehicle interiors; engines and transmissions; and steering and braking during the past several years," said David Sargent, vice president of global vehicle research at J.D. Power and Associates. "However, as manufacturers add new features and technologies to satisfy customer demand and new legislation, they face the potential for introducing new problems."
For the RockResorts luxury hotel chain, product shots are checking out while lifestyle photography is checking in. In its first new creative in five years, the Broomfield, Colo.-based Vail Resorts' RockResorts is focusing on the brand experience, as opposed to previous efforts that featured product photos of buildings and interiors. RockResorts is a collection of 12 boutique luxury hotels in Colorado, New Mexico, Wyoming and Florida and the Caribbean. With the recent additions to the RockResorts collection -- including hotels in Jamaica, Miami and the Dominican Republic, as well as in Beaver Creek and Breckenridge, Colo. -- it was the ideal time to develop a new campaign that reflects the unique experiences offered at each destination, says Shelle Pourmanafzadehardabili, corporate director of marketing, RockResorts and Vail Resorts Hospitality. "The campaign is primarily focused on the leisure guest, though we have featured it in both consumer and travel agent publications," she tells Marketing Daily. "We have moved away from direct mail over the past few years, as it is not consistent with Vail Resorts' culture of sustainability. We would, however, consider creating a high-impact "keepsake" insert for one of our partner publications." From Denver-based Cultivator Advertising & Design, the creative focuses on the connection that guests experience with each property's natural surroundings. The ads play up that RockResorts properties are small in scale, environmentally sensitive, and unique in location, style and character. Headlines like "{Be} Hold," "{Be} Come," and "{Be} Longing" are intended to suggest an inner sense of "being there," as are the campaign's snowy Rocky Mountain and Caribbean beach scenes, in which visitors are small and the outdoors is great and large. The new campaign will encompass approximately 100 ads featuring 20 Rocky Mountain scenes and 18 Caribbean shore scenes, and is slated to run through 2012. The media buy includes magazine spreads, full pages, and full-pages/ opposite columns, as well as newspaper full pages and half pages. Media includes WSJ. Magazine, Ocean Drive, Arrive Magazine, Texas Monthly, Sunset, 5280 and The Denver Post. A cover wrap plus the following full page will run in business-to-business publications including Luxury Travel Advisor and Travel Agent. However, the resort chose not to include online banners or outdoor boards in its buy, she adds. "Those channels are primarily used to promote larger Vail Resorts Hospitality initiatives (incorporating all Vail Resorts lodging options, including branded and non-branded properties), not RockResorts-specific ones," Pourmanafzadehardabili says. "We are, however, planning to incorporate elements of the campaign into our collateral (in-room directories, key cards, gift certificates, brochures) throughout the next year." The target remains consumers ages 35 and older with $100K+ household incomes, residing primarily in New York, Miami, Chicago, Texas, Colorado and California. "There is no shift in our target audience," she says. "For over 50 years, RockResorts has focused on attracting guests who are interested in combining a luxury vacation with authentic ways to experience a destination. We always have -- and we continue to be -- committed to connecting our guests with the true spirit, adventure and natural wonder of each destination. This new ad campaign simply provides a platform from which to illustrate that brand promise and its fulfillment."
Taco Bell's media blitz aimed at countering the bad publicity created by a lawsuit claiming the chain's taco filling doesn't contain enough beef to be advertised as beef seems to be paying off. A week after the suit was filed in mid-January, the QSR responded with full-page ads in national newspapers that grabbed attention with the headline "Thank You for Suing Us," followed by the details on the makeup of its filling. These were combined with a social media campaign and a Facebook-based offer for a free crunchy beef taco to thank the chain's loyal customers. But that campaign reached only about half of the U.S. population, so beginning this month, Taco Bell launched a $3 million television campaign on mainstream and Hispanic networks. Those spots feature real Taco Bell employees driving home the message that the taco filling is 88% USDA-approved beef and 12% water, seasonings and other "signature recipe" ingredients. The employees also suggest that consumers check out the full ingredients breakdown at TacoBell.com. The "Talk" campaign is also being run on radio, and has social media and online keyword buy elements. So how's it going? The tide appears to be shifting back in the fast-food chain's favor, according to tracking data from YouGov's BrandIndex. The scores range from 100 to -100 and are compiled by subtracting negative online/social media feedback from positive feedback. A zero score means equal positive and negative feedback. Taco Bell's "buzz score" among adults (asking whether they've heard anything about the brand in the last two weeks, and if so, whether it was negative or positive) plummeted from 19.1 on Jan. 3 to -10.6 on Feb. 7. However, as of March 15, it's back up to 9.8. The chain's "recommend" or brand loyalty score ("Would you recommend the brand to a friend?") has also rebounded significantly. That score dropped from 19.6 on Jan. 3 to 1.3 on Feb. 8, but was back up to 13.2 as of March 15. Taco Bell's quality perception ("Is it high or low quality?") -- which wasn't so hot even before the lawsuit -- is also climbing back up toward its old levels. That score was at 4.8 on Jan. 3, -10.7 as of Feb. 16, and 2 as of March 15. BrandIndex conducts online interviews with 5,000 people each weekday from a representative U.S. population sample. Respondents are drawn from an online panel of more than 1.5 million. The margin of error is +/- 2%.
Top 10 DMAs in which adults reside who agree with the statement, "Wealth: having a plentiful supply of material goods and money" is very important 1 Los Angeles, CA 2 New York, NY 3 Chicago, IL 4 San Francisco-Oakland-San Jose, CA 5 Austin, TX 6 San Diego, CA 7 Atlanta, GA 8 Boston (Manchester), MA-NH 9 Las Vegas, NV 10 Baltimore, MD Source: GfK MRI's 2010 Market-by-Market study
When you're a small agency just starting out, you need every client you can get. Scratch that -- almost every client you can get. There are those clients that you can eliminate right from the start: they need everything yesterday, on spec for now, but the payoff is guaranteed once their [insert whatever next-best thing here] takes off. If you get those demands before you start, run for the hills, folks. But back to my point. There comes a time when you can afford -- monetarily and mentally -- to break up with your client. Your agency has grown and your client roster is no longer dictated by cash flow, or the lack thereof. There are many reasons to call it quits, but I have never given marching orders to a client for one single reason. It's always been a multitude of factors that have built up over time until the point of no return. Breaking up is never easy to do, in any type of relationship. This column was spurred by a recent experience within my agency, and I wanted to share a few reasons why you should consider breaking up with a client if the relationship isn't what you had hoped for. Reason #4: "Mind your copy for a shilling, sir?" In this business, it pays to be frugal, but you also get what you pay for. Some clients refuse to give in to the fact that we don't live within the pages of a Dickens novel. If you've proven your worth over the years to your client, and they still complain about rates, insist on markdowns, and belabor your honest billing, send them packing. It's time for them to find out if there really is an agency out there that can service all of their needs for what they expect to pay, which is very little. Reason #3: "I'm just not that into you." Face up to it: it's a bad strategic fit. Years ago, they loved your pitch, your vision, your ideas. None of it has come to fruition. Time and time again, you have attempted to steer them toward that vision, only to find that the client is simply looking for a Band-Aid for their current problem(s). Symptoms of bad strategic fit include: a client who exhibits indecisiveness, anxiety, little strategic insight; an agency that repeatedly finds itself fighting for consistency, flailing through endless days of fire-drill work. Reason #2: "I'll Huff and I'll Puff" Your client is a bully. Granted, both of you can have a disagreement over strategic direction and tactics, but a constant reminder that it's "my way or the highway" always results in a poor working relationship. Such an attitude by the client stifles creativity and limits your agency's effectiveness: you're relegated to being an order-taker. In such a case, there is usually no collaboration and the agency ends up hurting its reputation (after all, it's not your work anymore -- just the client's order). Precedence is key here: if you start out simply following direct orders and never assert your direction, you'll have a hard time turning the tide forever after. Reason #1: "I Need it This Way ... Regardless of how many times you've discussed the direction, and never mind the plans, if a client constantly disregards what you have to offer, cut them loose. "I need it this way" is yet another way of cutting you out of the picture. It does the brand no good, and you've placed your talent, marketing skills, and your reputation in the hands of your client. You're Fired. Really. Think about how many fires you put out daily. Do you constantly have to turn out hasty projects on a moment's notice, without proper planning or thought? Does your output have any consistency, or is your body of work for this client a panic-based mishmash? So why prolong the pain any longer? Tell them to get lost (nicely, of course). There are, of course, traits from every one of these reasons in almost every client, but if you have one client (hopefully, just one) that fits all of these reasons -- or even three out of four -- it's probably time to give them their walking papers. As with matters of the heart, breaking up with a client can be painful. It hurts to cut loose a routine that's become second-nature -- even when it's not good for you. But if you can't tell a client "You're fired," and don't want to hurt their feelings, you can simply tell them: "You're just not ready for a relationship right now." Have you had a nightmare client that you've had to fire? What did it take to get to that point?