Subaru is gearing up to launch its second holiday-season campaign, "Share the Love," that mixes corporate goodwill with an incentive to buy.
The program, which launches on Nov. 21 and runs through Jan. 4, gives $250 for every new Subaru vehicle sold or leased to one of five charities chosen by the buyer of a new Subaru vehicle: The American Society for the Prevention of Cruelty to Animals; Meals On Wheels; Habitat for Humanity; National Wildlife Federation; or Boys & Girls Clubs of America.
This year's effort will be supported by TV commercials spotlighting the participating charities, as well as salutary quotations from consumers who bought Subarus under the aegis of the program last year, per Kevin Mayer, director of marketing communications at the Cherry Hill, N.J. automaker. Last year's effort brought in some $4.6 million to charities.
Usually, year-end closeout-type sales boost traffic but don't do much for the brand, but Mayer tells Marketing Daily that the inaugural "Love" program in 2008 managed, paradoxically, to increase both showroom traffic (and sales) in the short term, and raised brand measures in opinion and familiarity.
"If you think about the tone of the message, it was so different from everyone else's. People could participate with the brand in a way that helped us stand out and gave us much greater ROI than normal. We spent probably 30% less last December [on marketing] than in the previous year."
Mayer says that while the program is "fundamentally the same program as last year," Subaru is working more closely with the five groups on a local basis. "All our regions and zones have reached out to them and vice versa. It's just much more integrated than last year," he says.
David Sullivan, line manager for Legacy and Outback, said at a New York press conference this week that the company's sales were up 41% last month -- with the Impreza car, the new Legacy sedan and new Outback crossover setting records. He said that the new Outback is also outselling Subaru's other crossover, Forester, for the first time in two years or more, and that sales of Legacy are up 50% versus last year. The company launched the newest version of Legacy in August with a launch campaign that ran through early October and is currently advertising the new Outback.
Mayer says that market data gathered since Legacy's August launch suggest that consumers normally aligned with Mazda6, Nissan Altima, Toyota Camry and Honda Accord are looking at Legacy. "Consideration has quadrupled since launch," he says.
Legacy is also bringing in SUV buyers because of the car's cargo capacity. "We see lots of people shopping midsized and smaller cars who are getting out of SUVs but they still want to have cargo room," said Sullivan. "But we also notice weird things like Hummer trade-ins on Legacy sedan. We are seeing lots of people getting out of traditional SUVs."
He says the new Outback, with a base price of about $23,000, is being cross-shopped against crossovers like Toyota's Venza, Volvo XC70, Ford Edge, Jeep Grand Cherokee, Suzuki SX4, and as an outlier, Ford Escape Hybrid. "All-wheel drive is the number one reason people buy Outback," he says. "And almost 20% of owners say they go off-road at least once per month."
Subaru is now approaching 2.5% market share in the U.S., per Sullivan. "Fourteen months ago we were at 1.4%." He says the company can't rely on brand loyalty. "But with the Cash-for-Clunkers program, of 17,000 Subarus sold, only of 173 were Subaru trade-ins so we are breaching new ground all the time."
Subaru buyers are in their 50s, evenly split male and female, with a $70,000-$100,000 income range. "They are three times as likely to do outdoors activities, are much better educated that the mean, with most either college or graduate, and 30% of all Subaru owners have graduate degrees. "Eighty percent of Forester owners have graduate degrees," he says.