A visit from company President Akio Toyoda notwithstanding, Toyota has gone out of its way to assimilate into the American automobile culture. First, they gave us the (seemingly) ever-present “Toyota-thon.” A flashy, sparkly and very American-styled sale. For years prior to that, the Japanese car companies chuffed at the very notion of a sale. But Toyota saw an opportunity to take over the lucrative American market. That meant that they would sacrifice a little Japanese brand equity for more sales. They, quite literally, “sold out.”
Next came trucks. And not the little 4-cylinder jobs. The big guns! Half-ton and larger. Here they saw an opportunity to circumvent the Ford versus Chevy conversation by building their own big truck. They started slowly, but eventually sales would overtake Chrysler and threaten Ford. The next logical step? NASCAR, of course. And why not? Most of the Toyota vehicles sold in the U.S. are manufactured in North America (not necessarily the United States, mind you)? It was just the next step in the de-Japanesation of the Toyota brand.
So now we have the big recall. It’s Toyota’s fall from grace in the American automobile market. And as Joseph Jaffe points out in his blog post, they were ill prepared to react to this kind of brand body slam. Now Toyota is just another big car company with questions about quality and transparency. In short, they’ve finally become an American auto company.
I would argue, however, that they are still in a good position to bounce back. If nothing else, they started their tumble from a higher point in terms of brand equity. Can you imagine if this had happened to Chrysler? One of two things would have happened. Either the brand would have vanished from the auto buying discussion completely or the collective shrug from the American market would have indicated that a company with such a history of struggles just found another way to disappoint us.
So, what should Toyota do now? I grew up in the retail automobile business, the son of a new car dealer.
And I’ve spent my life building brands. So my suggestions are from those two perspectives. In this order, Toyota should:
1. Connect vigorously with its customers via social networks.
This is Jaffe’s main thesis, and it’s an excellent one. Unfortunately, this can’t happen overnight since the infrastructure was not already in place. But it’s important enough that they should throw labor and money in that direction now.
2. Open a line of communication to dealers like never before.
I’m talking about daily, if not hourly, briefings with technical information, customer relations data and most importantly, brand leadership from the company! The dealers are the ones who are seeing and hearing from the individuals with concerns. They need to be empowered to deal with these concerns.
3. Fix the problem.
Sounds simple. And ideally this should be number one. Yet there is no true fix as of this writing. They need to figure out what the problem is, fix it quickly and let the affected drivers, customers of their brand, and the public at-large know what went wrong and how it was rectified. In that order. Remember the Ford Pinto with the gas tank explosion issue? I do. It doomed a very successful line of vehicles and scarred Ford for years beyond that. Public perception was that Ford was disingenuous and dragged their feet. I don’t know if that’s completely true or not. But for the purposes of saving the Pinto as a brand, it didn’t matter.
4. Build a new quality story for the brand.
“Toyota quality” as a brand slogan is dead. This does not mean they don’t build a quality car. Ironically, I believe they do. But the story they’ve been telling for the last 30 years or so has suddenly become a punch line. The new story needs to start with humility, transparency, communication and lots and lots of goodwill towards their customers. Any proclamation of “quality” of the Toyota vehicles needs to come from the lips of J.D. Power, Consumer Reports or another trusted third-party source. Not from Toyota. Not any time soon.
5. Tell the rebuilding story.
Jaffe points out that Americans love an underdog. That’s true, but to me that’s not what Toyota is. Toyota is Goliath who has just been struck down. That does not make them an underdog. Just beaten up. What we do value (with apologies to Jerome Kern) is the idea of picking ourselves up, dusting ourselves off, and starting all over again. Especially as the entire country is being forced to do this, I believe we’ll cheer on a brand that does likewise. However, we’ll only be behind the brand if they have owned their problem, corrected it and communicated well and contritely.
It sounds trite to say that this is an opportunity for Toyota, but I believe that to be true. They were caught with their pants down – unprepared to dialog with their customers and the public. They fumbled with the fix for the problem. And now they have a trust issue. However, with the legacy of the brand’s strength and with the proper steps to rebuild it, there is no reason Toyota can’t come back as strong as ever. To say that Toyota is now truly and American brand is to say that they are not infallible. They have our attention now for all the wrong reasons. Let’s see what they do with it.