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VW strikes chord with young driversSleek, sporty cars spur automaker’s comeback
None has done it better than Volkswagen AG. Armed with a lineup of sleek and stylish compact cars, the German automaker has come back from near-extinction in the U.S. market in the mid-1990s to become the top-selling European brand. Volkswagen sold more than 355,000 cars in the United States in 2000, giving it a 2-percent share of the market. Compare that to the feeble 97,000 vehicles sold in 1994, and VW’s turnaround has been as impressive as any brand in the market. But beyond the sales figures, VW’s customer base is the envy of the industry. The average VW buyer is 37 years old with a household income of $68,000. Nearly two-thirds of them have college degrees. How does VW connect so well with young, well-educated professionals? “We really don’t look at a demographic,” said Frank Maguire, VW’s head of U.S. sales and marketing. “We look at a psychographic. Our customers are hip, they’re cool, they’re on the edge. They connect with us because we fit that image.” VW’s core products — the Jetta, Passat and New Beetle — combine sharp, expressive styling with superior handling and peppy engines. Like their owners, the cars straddle stereotypes: reliable and sporty, different but smart, sensible yet adventurous. The last place VW wants to be is in the mainstream. “Chevrolet wants to sell a car to everybody so they have to build a car that will appeal to everybody,” said Maguire. “Well, we’re different and proud of it.” Volkswagen lost its way in the U.S. market a decade ago precisely because it tried to conform and, in the process, lost its individuality. “They attempted to make VW as American as possible right down to the colors and fabrics and interiors,” said Art Spinella, vice-president of CNW Marketing/Research in Bandon, Ore. “It almost killed them. They went back to where VW was, a German product and proud of it.” The turning point for VW came in 1998 when it unveiled the New Beetle, a remarkably successful reinvention of “the Bug” that captivated American consumers in the 1960s. Almost overnight, consumers swarmed VW showrooms to ogle the New Beetle. Many of them walked out as owners of Passats and Jettas. “We always thought the New Beetle would be a magnet for the brand and that’s exactly what happened,” said Maguire. The New Beetle also energized VW’s marketing efforts. Its advertising agency, Arnold Worldwide in Boston, produced a series of offbeat ads that tapped into the Bug’s “flower power” heritage while cleverly updating its dare-to-be-different personality. Arnold’s VW ads distilled the brand’s message, eliminating the clutter and hype that afflict so many automotive ads. In one print ad, a jet-black New Beetle is pictured against a stark, white background. Three words capture the Bug’s essence: “It’s a look.” Rarely do the product and the pitch fit together so succinctly. “There’s passion in the VW brand,” said Francis Kelly, president of Arnold Worldwide. “Marketing in Detroit tends to be very rational and thought out, but it tends to come out dry and crusty. We’re a little bit rational with a whole lot of passion.” Rather than gather consumers into focus groups, VW’s market researchers visit individual customers in their homes to understand their lifestyles. Recent Passat ads, for example, were tailored to young couples coping with parenthood. Volkswagen’s corporate Web site features short, quirky films that have nothing to do with cars, and everything to do with the tastes of VW buyers. “It’s all about building a relationship,” said Kelly. “Having a great Web site strikes a chord with young, up and coming people.” But creative marketing would fall flat if the cars didn’t measure up. VW’s longtime theme of “Drivers Wanted” is backed up by the firm suspensions, responsive steering and muscular engines of its sedans. “You drive one for five miles and you get out with a smile on your face,” said Chris Cedergren, an auto analyst with Nextrend Inc. in Thousand Oaks, Ca. “It’s the look and feel, the drive, the esthetics.” That’s how Leon Luedeman felt after recently test-driving a New Beetle at Fox Toyota-Volkswagen in Rochester Hills. The 20-year-old Oakland University student wanted to trade in his late-model Honda Accord for something more distinctive and fun to drive. He settled on a New Beetle with a five-speed manual transmission, a 1.8-liter turbocharged engine, leather seats, and a bold paint job called Blue Vortex, which VW ads describe as “blue on 11 cups of coffee.” “My brother leases a Jetta, so I wanted something different,” said Luedeman. “I wanted a car that was economical, but at the same time one that was a little bit peppy.” The New Beetle hit all the right notes. “It seems like VW knows what younger buyers want,” Luedeman said. VW expects to sell about 390,000 vehicles in the U.S. in 2001, and that doesn’t include the growing sales of its Audi luxury-car division. Even with the overall industry expected to slip from 2000’s record pace, VW isn’t scaling back its ambitions. “It would be easy to let arrogance creep in,” said Maguire. “We always
need to remember why we are where we are. The most important thing for us is to
stay focused, and stay different.”
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Charles V. Tines / The Detroit News
By Bill Vlasic / The Detroit News