It may be an understatement to say that Cadillac is an under performing brand. It’s the fourth biggest luxury brand in the United States, almost non-existent in Europe, and most recently recorded a 32 percent drop in sales (in 2009) compared to an overall 30 percent decrease for GM. Yet even though Cadillac’s launch models are experiencing record growth, the brand is still growing slower than two of GM’s other core brands (Chevrolet and Buick). In an effort to rectify this problem, the luxury brand is in the process of distancing itself from parent company GM, which was bailed out by the U.S. government to the tune of $50 billion last year (taking a 61 percent ownership stake in GM in the process).
For starters, Cadillac is cutting all ties to General Motors in its corporate communications structure by changing email addresses from @gm.com to @cadillac.com. This will ensure that Cadillac customers – current or potential – will not see GM anywhere in their communications with Caddy.
Cadillac is also erasing the GM name and logo from marketing, promotional, and dealer materials. This means that the base signs of dealerships selling other brands will no longer carry any traces of GM.
Dealer And Buying Experience
What’s more, Caddy will no longer participate in GM-wide promotional events such as the Red Tag clearance event (as we learned late last year when Cadillac introduced its Season’s Best event).
Cadillac will also launch an all-new ad campaign later this month. According to GM spokesman Nick Twork, it will come before a model introduction at the New York International Auto Show on March 31. The ads will be the first from Bartle Bogle Hegarty, the New York agency GM hired in January to replace Modernista! of Boston. And to get it out of the way, we’re just as unsure about the new model introduction as you are… perhaps it will be the production version of the XTS flagship sedan?
“We’re in the process of revamping all the things that face the customer,” Twork said. “The Cadillac brand is best communicated as Cadillac without GM.”
According to Susan Docherty, Vice President of Marketing for GM North America, the automaker is poised to begin research on how customers perceive the company. This may coincide with the long-awaited customer and sales retention tool spearheaded by Docherty.
“Consumers, in their minds, can separate out the corporation versus the brands,” Docherty said in an interview. “They can separate ‘Hey, I can still fall in love with a CTS coupe, but I may not necessarily be happy with the fact that General Motors had to go through bankruptcy.”
For 2010, GM is looking to increase Cadillac sales by 28 percent to 140,000 units. The most loyal GM fans will realize that all this is in stark contrast to the strategy undertaken by The General five years ago, when the company decided in favor of unifying its brands under a single/central GM brand. That was also when GM added its mark of excellence to all vehicles, a move that the company reversed in mid 2009.
The GM Authority Take
The GM Authority Team welcomes this change with open arms. What matters is that people are buying Cadillacs, not GMs.
There are also those who don’t even know that Cadillac is a General Motors product. By distancing itself from GM, Cadillac will be following the most successful luxury brand in the United States – Lexus – which cut all obvious ties to parent company Toyota in early and mid-2000s.
Add the fact that not everyone agrees about GM’s $50 billion government-backed bankruptcy last year, and this is good news all around! The next step for Caddy is to become the status symbol brand it once was.[Source: Bloomberg]