BA 223 - Marketing in the News Blog
The article that I chose on MarketingWeek discussed Volkswagen's use of marketing effectiveness to change the focus on their company from one of emissions scandal to a globally friendly and conscious organization. Over the past two terms, I took two sustainability courses at OSU, which made me more aware of the challenges facing our environment and how many big businesses have not seen the seriousness and magnitude of their actions on the global impact on our planet and environment. As a result, I chose this article because I thought it was very interesting how a company that has been around for many years, which previously had issues with selling products that tried to circumnavigate the environment emissions standards, is working on improving their image with the public and in the marketplace.
Some Background and Challenges
According to the article, in 2015, Volkswagen experienced a scandal that involved the company revealing that it had retrofitted 11 million vehicles with software that would allow the vehicle to pass pollution emissions testing in the laboratory, but as soon as the vehicles hit the road, the pollution emissions would increase above acceptable limits. The company was hit with huge fines as a result of the scandal. In 2020, the company released 231,600 electric vehicles and as a result became the “top electric vehicle maker in Europe.” On March 15th, 2021, the CEO of Volkwagon stated that the company plans to deliver 1 million “plug in hybrid and fully electric vehicles” by the end of this year.
Volkswagen Looking To Rebrand
On March 29th of this year, Volkswagen released a news statement that it was changing the name of the company to Voltswagen of America. Although the company later came out that it was a marketing April Fool’s joke, the company was able to use the supposed Voltswagon name change to capitalize on their new breed of electric vehicles in an effort to try to overshadow the scandalous history they had with regard to emissions and non-global friendly business practices. By then, many of the major news publications had already picked up the story as if it were the truth and the according to an article in Forbes magazine March 30th, the news had increased focus on the company’s new electric vehicle ID.4 that it had rolled out just prior to the faux name change announcement, and the stock of the company jumped by 9%.
According to the article, some of the marketing techniques used were:
Ensure the brand is easy to buy – how the product can fit with the prospect’s life
Get noticed – grab attention, focus on brand salience to prime the user’s mind
Refresh and rebuild memory structures – make the brand easy to notice and easy to buy
Create and use distinctive brand assets – sensory cues that get noticed and stay top-of-mind
I feel that Volkswagen really capitalized on item number 3, buy using the play on words of “Voltswagen” emphasizing their future focus on hybrid and electric vehicles. By stating they were going to change the company name, it showed an effort to emphasize the environmentally friendly direction that the company was trying to go. They used the name to refresh the memory cues that people would think of when they heard the company name and the term “Volts” in the beginning of the rebranded name made people see the company as an electric vehicle company. The word “Volts” also is used as an attention grabber, and even the word itself can make people think about the jolt one feels from electricity.
While I think that this type of marketing ploy has been used by other company in the pasts and had some positive impacts for the company by bringing attention to their new products, their new future focus, and improving their market share on a temporary basis, placing the information out into the public and the media then withdrawing it as false could have some long term repercussions on the public opinion of the company and their trustworthiness in the marketplace in the future.
Value Proposition
Volkswagen even talks about their vision “Shaping Mobility for Generations to Come” and their strategy page talks about their values and vision and repeats the word “sustainability” throughout and how their company values sustainability for generations to come. (https://www.volkswagenag.com/en/group/strategy.html) One of the electric vehicles that the company has introduced is the ID.4, which can get 104 city and 89 highway miles MPGe.
https://www.marketingweek.com/volkswagens-marketing-effectiveness-in-action/
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