How to Market Hummers to the Masses

[BMWDave]

Link?

By JEREMY W. PETERS
Published: June 28, 2005
DETROIT

HUMMER is a brand comfortable with its skin, or sheet metal, as it were. And it knows exactly who buys its trucks.

Typically, Hummer buyers have not been pragmatists on a tight budget. Practicality and value, after all, have never been part of Hummer's appeal.


In another ad to introduce Hummer's H3, its smallest model, a character named Ed the Courier makes a suggestion about size.
The problem with aiming at such a narrow demographic, Hummer has learned, is that you can sell only so many $50,000 supersize sport utility vehicles. So last month, Hummer introduced the H3, a squatter, scaled-down version of its top-selling H2. The H3 is being billed as the Hummer for people and pocketbooks of all sizes.

In one commercial in the new H3 campaign, a group of exasperated Hummer executives stand around a boardroom table, shuffling through vehicle drawings as they try to come up with the next hot product. "Something new - we've been there," groans one of them. Then comes the entrance of Ed the Courier, who is so short that his shoulders barely reach the executives' waistlines. "Why not make a smaller one?" Ed asks as he reaches up to hand an envelope to someone at the table. The executives all turn and look at Ed - then at one another - with "Why didn't we think of that?" expressions.

About 17 inches shorter in length and 6 inches lower in height than the H2, the H3 is petite by Hummer standards. It's also the least expensive Hummer, with a base price around $30,000.

Because this is Hummer's first vehicle that is not out-of-reach for most Americans, it had to create advertisements with mass-market appeal, a challenge it never faced before.

"Hummer has a huge opportunity as a brand to expand into lots of segments down the road," said Liz Vanzura, Hummer's marketing director. "With the H3, there are a lot of people that can say, 'Hey, now I can get one.' So it's a larger audience for us."

The campaign for the H3, which includes six new television commercials already showing, is intended to connect with a wider cross section of consumers than Hummer has sought out in the past.

"The brand has a lot of different personality levels that it allows us to kind of play around in," said Lance Jensen, creative director at Modernista, the Boston advertising agency that designed the H3 campaign. "You can do the serious capability stuff, the real rough-and-tumble rock climbing stuff, the peaceful back-to-nature stuff. Plus, it's never bad to make people smile when they're watching a TV spot."

One difficulty Hummer faced in marketing the H3 was convincing people that it was practical to own. "Because it looks and has so many design, styling cues of the iconic Hummer," Ms. Vanzura said, "the challenge was how to introduce it to people."

In another commercial, the camera focuses on an empty parking spot. As music from the Richard Strauss symphony "Also Sprach Zarathustra" plays, a Hummer pulls up to the spot and parallel parks effortlessly.

"People want something that's a little bit more maneuverable," Mr. Jensen said. "The parking commercial, that's pretty, like, 'duh.' But we had to do it because being maneuverable is important to a lot of people."

Not that Hummer backs away from its rough-and-tumble image in its new commercials.

"You always want to showcase that it's authentic and that you haven't lost your DNA when you bring in a less expensive version," Ms. Vanzura said. One commercial, "Rock Star," shows the H3 plowing through uneven, unpaved mountain roads and scaling boulders, much like the H2 commercials of old.

The question lingering over Hummer is whether the brand can be all things to all people, or at least all things to enough people to make the H3 a success. Not everyone is convinced that Hummer can sell itself to the masses.

"I think it's impossible," said Mary Ann Keller, a longtime auto industry analyst and author. "How in the world can you possibly fathom that something that looks like a military vehicle is practical for the average driver?"

Limited demographics are only the beginning of Hummer's problems these days. With oil prices reaching record highs and consumer tastes shifting away from larger S.U.V.'s to smaller and more fuel-efficient S.U.V.'s known as crossover vehicles, Hummer is working against some challenging market trends. The H3 gets about 20 miles per gallon on the highway. Although that is better than the H2, which averages about 13 miles per gallon on the highway, it is hardly fuel efficient.

Through April, the month before the H3 went on sale, Hummer's sales were down 12 percent compared with the first four months of 2004. Compared with the first four months of 2003, when Hummer was still in its retail heyday, April sales were down 34 percent.

Initial sales figures show that the H3 is driving Hummer's numbers up. In May, sales of Hummers were up 62 percent compared with May 2004.

The H3 is the vehicle Hummer hopes will revitalize the brand. "I don't think the brand was faltering with the H2," said Matthew Vazana, the general sales manager at Suburban Hummer in Troy, Mich., a suburb of Detroit. "But when you have a two-product line, you're going to max out."

Before the H3's introduction, Hummer had only two models, the H2 and the H1, the traditional military-style Hummer that starts at about $100,000.

Mr. Vazana's Hummer dealership is one of many across the country built to resemble a militaristic Quonset hut. As part of its brand-recognition strategy, General Motors, which owns the rights to the Hummer name and oversees its marketing, made dealers erect the large steel, glass and concrete structures. "It's very recognizable and fitting for the brand," Mr. Vazana said.

Hummer is counting on selling that rugged image while showing consumers that the H3 is not excessive. Whether that strategy will work remains to be seen.

Mr. Vazana, meanwhile, is planning to hire additional sales help this summer to accommodate an influx of H3 customers. "You could probably have some stores that could double, triple, quadruple their business," he said.

[R33 GT-R]

I think these things are going to sell like hotcakes.  Probably going to pinch some sales from the cute utes.

[BMWDave]

I think these things are going to sell like hotcakes.  Probably going to pinch some sales from the cute utes.

Theyre not really going after the cute utes...this is going after the midsizers.

[TBR]

Still wish it had more power.

[BMWDave]

Still wish it had more power.

Yea, the I5 just doesnt cut it.

[mazda6er]

I think these things are going to sell like hotcakes.  Probably going to pinch some sales from the cute utes.

Yeah they are. To all those playas who wanna roll on dubs, but don't have the ice to cop an H2, aight homes!    

[footoflead]

H2/H3=POS

[TBR]

Still wish it had more power.

Yea, the I5 just doesnt cut it.

Yep, I never understood why GM suck so much money into the new I4/I5/I6 when they already had numerous engines that could have been modified for modern truck/suv duty with much less investment.  

[ifcar]

I'm sure there was a good reason.

[TBR]

I'm sure there was a good reason.

Like what?  

[ifcar]

Perhaps cost to build was a factor, perhaps fuel economy was a factor. I don't know, but I assume that there was some reason that they decided to develop the powertrain.

[TBR]

Perhaps cost to build was a factor, perhaps fuel economy was a factor. I don't know, but I assume that there was some reason that they decided to develop the powertrain.

It would take a long time for the incremental savings involved in the building of the engines to make up for the large expense of developing a completely new engine line-up.  

[280Z Turbo]

GM was stupid to get rid of the 4.3L Vortec. My friend has a '98 Jimmy with that engine and that thing is a beast! GM's truck customers don't care so much about sophisticated DOHC design or even horsepower. They want a reliable motor with torque.


(good 'ol 4.3)

There's lots of people out there that think just because it's smaller and has one less cylinder, it's wimpy. They just so happen to be correct. :D

[ifcar]

Perhaps cost to build was a factor, perhaps fuel economy was a factor. I don't know, but I assume that there was some reason that they decided to develop the powertrain.

It would take a long time for the incremental savings involved in the building of the engines to make up for the large expense of developing a completely new engine line-up.

So are you suggesting that GM designed those engines with no purpose in mind?

[Raza]

Still wish this and the H2 were never released upon this earth.

Hummer...  

[TBR]

Perhaps cost to build was a factor, perhaps fuel economy was a factor. I don't know, but I assume that there was some reason that they decided to develop the powertrain.

It would take a long time for the incremental savings involved in the building of the engines to make up for the large expense of developing a completely new engine line-up.

So are you suggesting that GM designed those engines with no purpose in mind?

No, I think GM just didn't think it through.

[ifcar]

What do you think that their reasoning was, then?

[TBR]

What do you think that their reasoning was, then?

An advertising gimmick, or maybe just getting media attention in a positive way (we all know how the much the automotive media loves I6s).  

[Raza]

What do you think that their reasoning was, then?

"Hey, let's make an I5!"

Drunken bet, probably.

[ifcar]

What do you think that their reasoning was, then?

An advertising gimmick, or maybe just getting media attention in a positive way (we all know how the much the automotive media loves I6s).

No, a V8 would be an advertising gimmick. They don't advertise the fact that they have only a 5-cylinder when their competitors have sixes or eights, and for good reason.