gmtPLUS09 | live from Seoul

A new survey by NOP World consulting says most Mercedes-Benz, BMW and Toyota customers are considered “active brand advocates”, who will by word-of-mouth recommend the respective brands to friends and relatives. But more interesting is that these brands is the best word-of-mouth of all global brands, not just automakers.

Consumers
in 31 countries, including the United States, were surveyed last year.

More than 90 percent of Americans say word-of-mouth is their
best source of information about products and services, NOP says.
Personal testimonials are twice as important to those consumers as
advertising or editorial content, NOP says.

This is great proof to what they say about empowered consumers. Simple ingredient is to provide high-quality goods and make every effort to resolve customer complaints and concerns, which count to be a exceptional and/or distinguished customer experience. And this inspires customers to go beyond the effectiveness of any PR event.

Automakers can also encourage this type of guerilla marketing by engaging customers in on- and off-line car clubs and offering special events such as road rallies. Such promotions will keep customers remembering and talking about the brand.

Word-of-mouth promotions are a significant measure of
a brand’s success. Customers who talk up a brand are most often repeat
customers. They also tend to spend more money with the
companies they advocate.

Vehicles tend to inspire more brand loyalty than other
consumer products because automobiles are the most expensive of all consumer goods and likely considered an investment, and purchasing a vehicle is likely to be both
time-consuming and exciting.

As Tim Wragg, global director of NOP World’s customer management center says, “People are emotionally tied to their car.”

NOP World’s “advocacy multiplier” study is designed to measure
consumer commitment to various brands. The research defines four levels
of commitment:

1. Indifferent: The customer has little or no brand loyalty.

2. Fulfilled: The customer is willing to consider buying the brand again.

3. Committed: The customer is predisposed to the brand.

4. Active Brand Advocate: The customer is a walking advertisement for the product.

With this trend apparent in Europe, the big and bold front ends have
skipped the pond and is picking up steam as it becomes the latest fashion statement in the US.

The catalyst to this movement was the EU’s safety regulations designed to reduce pedestrian deaths, which has led stylists to develop bigger and more vertical-faced front ends.

Some examples (left to right):
Big grilles are a Bentley
trademark. Design Director Dirk van Braeckel’s styling team drew
inspiration from the 1952 Bentley R-Type Continental for the 2006
Continental Flying Spur, which arrives in the United States in
September. The grille is designed to break apart if the car hits a
pedestrian, lessening injuries.

The Lincoln Zephyr, which goes on
sale in the fall. Says Chief Designer Phil Simmons: "We set out to
incorporate luxury and the sense of space in the Lincoln Zephyr. For
example, wrapping the grille and headlamps around the front corners and
repeating that theme at the rear evoke a sense of imposing space

The dominant feature of the
2006 Audi A3 is its single-frame grille, which the automaker says has
design roots in Audi’s racing history.

When the 2006 Pontiac Solstice
fills your rear-view mirror, you’ll fully appreciate the prominence of
the car’s big honeycomb grille. Production of the low-slung roadster,
designed by GM designers Franz von Holzhausen and Vicki Vlachakis, is
scheduled to begin this summer.

With its distinctive cross-hair
grille, the 2006 Dodge Charger is meant to trigger memories of the
muscle cars of the 1960s and 1970s. "You just have to look at the front
end - that sneering, that attitude, that confidence. That is what the
Charger is all about," says the Chrysler group’s Ralph Gilles, whose
team led the production design. The Charger is arriving at dealerships
now.

The Economist  has a very insightful article into the Chinese perception of not-yet happened auto culture in China.

Just as the availibility of cars played an integral role into the growth of the American middle-class, it appears a similar case will happen there, but it should be interesting to see how it plays out.

The Chinese motorization age should occur light-years ahead of other Asian countries such as Japan and Korea, with its implications on society having a wide reach and scale.

Another interesting perspective this article and many others before it describes in the future outlook of energy distribution. Because the Chinese is now growing dependent on imported oil with a staggering third going to automotive use, it should be also interesting to see if they will break away from the gasoline distribution system. This system is still relatively new to them, and since China is not totally dependent on a gasoline infrastructure, it has the opportunity to go into greenfields a la hydrogen. With the expected number of vehicles that will be on Chinese roads in the next decade and a half, they can really put a dent into reducing global emissions.

A plus side to all this is that by the time the rest of the world is ready to dump the legacy gasoline infrastructure, they can get the hydrogen system at commodity prices and with a knowledge base to go with it.

Interesting stuff.

Samsung Electronics has provided luxury Lexus
sedans to seven of its presidents early this year, replacing previous
Hyundai Motor’s Equus sedans.

According to the Central Motors Corp., one of
nine dealers of the Japanese luxury auto brand in Korea, the
electronics giant purchased seven Lexus LS430 worth some 110 billion
won for the seven presidents including Hwang Chang-gyu and Lee Ki-tae.

Samsung Electronics said provision of luxury
sedans to top rank executives follows a promise by Samsung Group
chairman Lee Kun-hee that he would treat his executives on the same
footing with their counterparts in top-tier global multinational
corporations.

“Samsung Electronics decided to purchase
Japanese brand cars taking into account the fact that our major
Japanese business associates have purchased Samsung’s products on a
massive scale,’’ a Samsung Electronics executive said on condition of
anonymity.

In the beginning of the year, the Samsung Group
decided to grant premium passenger vehicles to executives with ranks of
executive vice president or above at its affiliated firms.

A chief executive of Samsung Everland also recently purchased a Lexus sedan.

Top executives of other Samsung Group affiliates
are also expected to replace their sedans with latest foreign offerings
later this year.

Until last year, the Samsung Group has provided
executive vice president and above level executives with Equus, the
most expensive model produced by Hyundai Motor, and SM7 to senior
executives with ranks above vice president.

Samsung Electronics said the company supports 80
million won for the new car, price of Hyundai Equus, and its top-rank
executives can purchase any luxury car they want as long as their
shoulder the rest of the cost burden.

Lee Kun-hee currently rides in the Daimler
Chrysler flagship Maybach 62, an ultra-luxury sedan priced at 720
million won, and his wife Hong Ra-hee owns Audi A8. Samsung Electronics
vice chairman Yun Jong-yong uses Mercedes-Benz S500 provided by the
company and Lee Hak-soo, vice chairman of Samsung Group’s corporate
restructuring office, rides Audi A8 4.2 Quatro.

Maybach 62, which has a price tag higher than the
Rolls-Royce’s new Phantom, is the most expensive passenger vehicle
available in Korea so far.
            

Link: The Korea Times : Samsung Offers Lexus to Executives.

Microsoft Corp. executives hope the Apple iPod will be good for its new in-car computer, Windows Mobile for Automotive.

Automakers are seeking ways to make it convenient for drivers
to bring aboard their portable electronic devices, says Martin Thall,
general manager of Microsoft’s Automotive Business Unit. Thall spoke
during Microsoft’s Global Automotive Summit in Dearborn, Mich., on
April 29.

Microsoft believes its computer, which is called TBox, provides part of the answer.
Windows Mobile for Automotive allows iPod owners to plug
digital music players into the instrument panel so they can listen to
music on the vehicle’s stereo system.

Priced at about $200, Microsoft’s system is equipped with
Bluetooth technology to link to a cell phone for hands-free calling,
provide route guidance through voice recognition and connect to the
Internet using a cell phone or personal digital assistant. A pricier
version of the system offers access to telematics services such as
remote vehicle diagnostics and electronic telephone directories.

Thall said the iPod could be the "tipping point" for more
automaker interest in in-car computers that link drivers with portable
players.
Apple had sold more than 10 million iPods by December.

Microsoft wants to make inroads in North America after landing
a major contract with Fiat Auto. Fiat is installing the computer across
its model lineup beginning this fall.

Microsoft continues to peddle Windows Mobile for Automotive to other automakers and Tier 1 electronics suppliers.

But Peter Wengert, group marketing manager for Microsoft’s
Automotive Business Unit in Redmond, Wash., said Microsoft has not
landed another contract.