Brand vs Product

I just wanted to share a few observations with you about brands and products.

I have a friend in England who owns a Jaguar XFR. He’s a guy who gets right into the companies behind the cars that he buys and accordingly, he’s right into everything Jaguar at the moment (he would have had a 9-5, by the way, but no-one would give him a price for one, so that will have to come later).

Earlier today, he sent me the following via email:

In the first 6 months of the year, in the UK, the Jaguar XF outsold Audi A6 – all variants – and BMW 5 series – all variants. Whilst there are no doubt special reasons for this –model changes, etc. it does appear to show that people will buy a car off any car company, large or small, if the product is good.

The Jaguar brand started from a loftier perch than Saab, but did have to endure some products that were below customers expectations under Ford’s ownership. Of course, there’s also the age-old maxim of having to own 2 Jaguars (one to drive whilst the other is being repaired).

The point, however, is that Jaguar’s brand and reputation were preserved well enough through the years that all it needed to succeed was good product, which it now has in spades (incredibly good product, from what I hear).

Another brand reported to have excellent new product, albeit relatively new to Australia in its updated form, is Skoda. The Czech company actually dates back to the late 1800s but it’s fair to say that it’s never been an aspirational brand, not here in Australia, at least. It’d be more accurate to say they were seen as something akin to Lada, which were generally seen on the streets in running order but in what seemed to be a visible state of decay.

Now under the wing of the Volkswagen group of companies, Skoda has re-launched here in Australia and its new cars are attracting praise from just about everyone who drives them.

I read a few reviews of the Skoda Superb wagon earlier today, and you would swear black and blue that it is the God-given answer to every prayer ever prayed by a parent who didn’t want to own a minivan.

Here’s Go Auto

What we’re saying, then, is that if you have low-$40s to splash out on a big wagon, you mustn’t overlook the Superb…..

…..we reckon the surprise package is the base petrol unit, because it is unbelievably sweet and smooth and quiet. Yes, the 103TDI is all these things too – for a diesel – but the refinement meter soars meteorically in the 118TSI. An extra bonus is its lighter nose that seems to improve on the Superb’s already alert steering and agile handling characteristics.

All Superb wagons have nine airbags, ESC stability and traction control, front fog lights with a cornering action, dual-zone climate control air-conditioning, integrated roof bars, tyre pressure monitors, heated front seats, auto-on lights, rain-sensing wipers, and an umbrella socket in one of the side rear doors, as well as the usual cruise control, electric windows, remote central locking, CD/MP3 audio, tilt/reach steering wheel adjuster, driver’s seat-height raiser and a multi-function trip computer.

And this is a reasonably big car that tops out in price where the new Saab 9-5 will most likely begin.

So why am I trying to turn you all in Skoda converts? Well, I’m not, actually. My point is this….

Despite having what are reputed to be new products with great engines, well equipped, aggressively promoted and well received by the Australian motoring press, Skoda haven’t become a great sales success here in Australia.

With a six-vehicle range of family oriented vehicles spread over three different models, Skoda were still outsold in Australia last month by Mini, which practically speaking have three styles of the same thing with only two useable seats. Skoda were significantly outsold by a much more expensive and niche LandRover as well.

Skoda’s big and more expensive brother, Volkswagen, outsold it by a ratio of 26 to 1 during June.

So, whilst good product is certainly key in this market, it helps a lot if that product is associated with a good, recognisable and well regarded brand. If not, there’s a good chance that people just won’t give it a second look.

The Saab brand has been double-damaged in recent years.

First, by GM restricting it to products that the market, and the scribes, deemed to be less than acceptable. Sure they sold a bunch, but they did so thanks to large incentives that crashed the resale values of the cars.

Second, by the attempted closing of the brand and eventual sale – a saga that stopped at the ‘closing’ point for many potential consumers.

Saab’s recent efforts in advertising have been a great start and they do have a great new product to offer in the Saab 9-5 and the Saab 9-4x that’s coming. I believe there’s enough brand equity remaining to take advantage of that, but as the above stories with Jaguar and Skoda will tell you, the combination has to be just right and as we all know, Saab won’t likely have a third chance.

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