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(originally published by Booz & Company)


All Brands Are Niche Brands

This, I think, is the key to the development of a strong niche brand. Each car in the overall brand’s line-up — Outback, Legacy, Forester, WRX — needs to fit perfectly into its own niche. That has created a lot of “love” for the overall brand, which we can capitalize on in turn as we promote it.

Before we began the campaign, we investigated the difference between Subaru owners and the owners of other, broader brands. Subaru owners, it turns out, have a very Porsche-like passion for their cars. People who own more mainstream Japanese brands typically see them as an appliance. For them it is a more generic, less involved ownership experience. Our campaign strategy was to tap into the idea that there is a car company out there with which you can have a slightly different relationship. Its products, and the ownership experience, are unique.

Of course, the goal of the campaign isn’t just to talk to current owners; otherwise, we wouldn’t have had the success we’ve had in expanding the brand. Potential buyers of a WRX or an STI are part of a niche of car buyers looking for performance, for a fun driving experience. Buyers of Outbacks are the type of people who might like to go camping or skiing. In other words, Subaru buyers are all what we call “experience seekers.” Experience seekers collect experiences, not just possessions, and our cars serve the niches in which they live.

We believe there are about 63 million experience seekers, as we define them, in the U.S. alone. That’s our target audience. And thanks to the Love campaign, our “conquest” number — the number of first-time buyers of Subarus — is going up, despite the recession.

Still, not many people buy a car solely for emotional reasons. Virtually any purchase involves the heart, the brain, and the wallet. And yes, our cars are a rational choice too; they’re reliable and dependable. And they are reasonably priced. But our success during this recession, relative to our competitors, depends heavily on our appeal to the heart. If you see your car as little more than an appliance, it’s easy to put off buying another one when times are tough.

Today, most car advertising shouts the same mantra: “deal, deal, deal.” We come at it from the opposite point of view. Good advertising these days assures rather than scares. Our Love campaign does just that, providing emotional reassurance rather than continually reminding consumers of the dire state of the economy.

You can introduce a product during a recession and still do well if you do it right. Doing it right means being true to who you are and positioning the product properly, while offering good, competitive value. That’s what niche marketing is all about. 

Author Profile:

  • Tim Mahoney is senior vice president and chief marketing officer at Subaru of America. 

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  1. Stuart Elliott, “Trying to Connect in a Crowd,” New York Times, April 24, 2008: A useful analysis of the genesis of Subaru’s “Love” campaign.
  2. John Gerzema and Ed Lebar, “The Trouble with Brands,” s+b, Summer 2009: An examination of why brands rise and fall, and how that correlates with shareholder value.
  3. Subaru Web site: The company’s North American home page.
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