Promoting Hybrid Automobiles

Peter Marshall

Jamie Daggett

Spring, 2003

The Environmental Problem

Oil is a limited natural resource that will run out in the near future. The United States Energy Information Administration (EIA) projects a 58% increase in oil consumption by the year 2020, yet oil reserves worldwide are drying up quickly. Much of the world’s energy and most of the world’s petroleum is fueling transportation. While hybrid vehicles are already in mass production, these cars have not caught on with US consumers.

The most current, widespread technology on the automotive market is a hybrid electric vehicle (HEV) that is powered by a gas and electric motor. Three types of hybrid cars are currently sold in America and include Toyota’s Prius and Honda’s Insight. While these environmentally conscious options save big on gas mileage, American media and car manufacturers do not promote hybrids close to as much as their gas-powered counterparts.

The lack of hybrid promotion may be because all hybrids on the market are produced in Japan and American car manufacturers are strongly opposed to promoting hybrids until they have a hybrid option on the market. This may also be that American industry is embarrassed that they have been promoting SUV’s for the last ten years, which have guzzled gas and led us into strife in the Middle East. Whatever the driving factor, it is clear that both the American public and US government have been more concerned with economic and social desires than environmental concerns and it has led to a non-hybrid America. If the media teamed up with the US government and automotive manufacturers around the country, HEV’s would become more popular and the United States would better solve environmental problems.

Ø Promotions That Already Exist

· Endurance Races

Current types of promotions for hybrid cars include entering hybrid electric motor vehicles in endurance races. Endurance races are events where automobiles enter a competition either to see how far they can travel in a set amount of time or to race a set distance in the shortest time possible.

Endurance races like the Daytona 24 last an entire day, and a winner is determined by how many laps are completed. During the race, pit stops for tire replacement and refueling can cost valuable time and distance traveled. This is where the hybrid technology can give a racing team a slight advantage over the competition.

· Lead Marathon Vehicle

In this situation the Hybrid vehicle makes an appearance and escorts the runners, particularly the lead pack through the course. In a marathon, the course would be 26 miles long and the hybrid would not even use one gallon of gas to complete the promotion.

· Drag Races

These races are much shorter than the endurance races, and show the versatility of the hybrid cars. Since the object of the race is to see who can cross the finish line a quarter mile away, speed and power are the main focus in these events. Many modifications typically have to be made to drag racing automobiles, so they can achieve high speeds. Aerodynamic adjustments include spoilers to keep the rear end down, increased power in the engines, and a host of other modifications. Many of these changes are highly complicated and scientific, which means that it takes time to get acquainted with the process.

· Gas Mileage Contests

These events challenge car owners to get all they can out of their gas tank. The object is to get the best gas mileage over a set distance. An instrument within the car measures the gas mileage. Other than car modifications that increase aerodynamics, there exists a variety of driving techniques. One of which includes driving with your shoes off in order to feel the car and make sure your acceleration is smooth. (Tank Tales)

Ø Benefits and Drawbacks of Current Promotions

· Endurance Races

The endurance races help spread the hybrid name into the professional racing world. At the endurance races, most of the competitors are highly experienced automotive professionals. When dealing with a group of educated people, many good ideas can spring from conversations, none of which would occur if the hybrids were not entering the races. The presence of hybrids in endurance races along side of Porsche, Mercedes Benz, Ferrari, and BMW means people at the top of the automotive spectrum are getting a taste of what could be the future of cars. The more people see these cars, the more familiar the cars become; and then these cars are not thought of as hybrids but rather normal automobiles. Introducing familiarity on the professional scene will help the word about the hybrids to filter down to the rest of the automotive world.

Even the automotive producers can benefit from knowledge gathered at the endurance races. By seeing the weaknesses and failures that occur when trying something new and pushing the limits, the manufacturers can gather critical information and new ideas for improving the current hybrid models (The Chrysler Patriot).

The endurance races serve as a type of experiment for the manufacturers, and the results are seen in the new models of the hybrids. Through a hands-on experience during the race, many new ideas materialize which can help improve hybrid performance. Also, manipulating the engines in the hybrids to compete with the current gas powered engines means the mechanics will have to be creative and aggressive. The gas engines have been perfected over many years whereas the hybrid motors are very new and room for improvement.

With this opportunity for quicker progress in the hybrid motors, many mechanics could have more flexibility with ideas for how to increase power and motor performance. With time, the hybrid technology would catch up to the performance of the gas-powered motors. However, the advantage is definitely on the side of the gas-powered engines at this point.

What makes the hybrid cars great for stop and go traffic, is precisely what will make the hybrid superb in endurance races (The Chrysler Patriot). Since endurance racetracks, like Laguna Seca in Monterey, California, contain many sharp turns that require braking, the energy from braking can be stored in the hybrid’s electric motor and used later to help propel the car without the use of gas. Conserving gas will limit pit stops and put the racecar farther ahead of the competition.

A major problem restricting the development of better hybrid technology is a lack of a serious demand for hybrid technology. While the demand is growing, more interest is needed for the companies to make drastic leaps in performance:

“Right now," Shosteck added, "consumers don't value fuel efficiency as highly as other attributes. Anytime gasoline is cheaper than designer bottled water, it's not a big deal"” (Crary).

If the demand and interest continues to grow as it has recently, then demand will not be a concern. In just a couple years the popularity of hybrids has exceeded the estimates of the manufacturers: “Toyota has sold 5,562 of the five-passenger Prius since June and now has a three-month waiting list.” (Mansfield). Increased demand for hybrids means more profits and will open up more research opportunities in hybrid technology. This will increase hybrid performance and increase sales, which in turn will free up more money for research and the cycle begins again, but the key is a demand for the product.

· Lead Marathon Car

Having a hybrid car at the head of a marathon targets a great audience. The people

seeing the hybrid are the spectators at the event and the runners in the marathon. Most likely these people have an interest in marathon running, which means they either are runners themselves or they are active people in some other way. The spectators make an effort to come watch the race, so they most likely enjoy going to large events and being social.

The major benefit in marketing the hybrid in this way is that the people who see it are an outgoing and active type of person. This type of person, after hopefully forming a good opinion about the hybrid, will share their feelings with people they know. Being that this audience is friendly and active, they hopefully have many friends, and, therefore, can help spread the idea of hybrid cars by word of mouth.

The down side of relying on this style of marketing a hybrid is that not many people reorganize their schedules to watch a marathon. The fan base for marathons is the type of target audience the hybrid wants, but at a marathon the number of spectators is not large enough to truly get the idea of the hybrid into mainstream life. Looking at the price of attendance for a marathon illustrates this point; the price for attendance is free.

· Drag Racing

Much like entering endurance races, drag races allow the manufacturers of the hybrids a chance to experiment with new ideas and test how their current ideas hold up. Drag races depend on high speeds and acceleration. Both of which the current hybrids lack when compared to the gas driven motor vehicles. Drag races, while more of a show than anything, allow hybrids to display their versatility.

Hybrids are a great idea for endurance races, but drag races give hybrids an opportunity to display more power and raw speed. Since most drag races are a quarter of a mile or shorter, the gas mileage is less of a concern, and acceleration is the main focus. Therefore, drag races will present a weakness that hybrids need to work on in order to catch up with gas driven motors. The purely electric cars are already making advances on the gas-powered vehicle, but more time and more improvements are needed before hybrids and electric cars can compete with the gas-powered dragsters.

The more reasonable competition will be mild drag races between cars straight off the assembly line. From advances in technology originating in the intense drag races, improvements can be made on new hybrids in manufacturing. Improvements on the hybrid’s acceleration will allow hybrids to bridge the performance gap between gas and hybrid vehicles. This gap is already being closed by vehicles such as the Dodge Durango: “Oswald told EVWorld that DCX engineers have staged "drag races" between the hybrid and gasoline versions of the Durango with the HEV handily winning every contest” (Moore).

With the results from these drag races, manufacturers of hybrid cars can move on to make hybrid sports cars. The drag races are perfect for gathering sports car type information. Acceleration is the key to success in both drag racing and the sports car industry. Cars competing at these drag races are sports cars, and therefore, the audience at these drag races would be interested in a sports car style hybrid car. If the manufacturers can post hybrid drag racing performances that are comparable to gas engines, then hybrid sports cars will gain demand from this type of audience.

While these drag races are much more prominent in Japan and other foreign countries, the idea and image behind drag races will help market these cars to younger audiences. Due to the short and exciting bursts of speed that drag racing offers, younger people will be able to keep their attention focused on drag racing long enough to become interested with the cars doing the racing. With fast food, microwaves, television, and high-speed Internet access, the younger consumers of automobiles do not necessarily care about endurance races. Their mentality is geared towards quickness. This might explain why the younger audiences are interested in illegal drag races with gas-powered engines. These drag races with hybrid technology cater to this audience, which will be the future consumers of cars.

While the drag races are great for the research going into future hybrid models, presently, the audience is too small, and the drag races are not publicized enough to make large numbers of fans attend. The fans that do attend are car enthusiasts, not the normal, mainstream public. In order to push for a larger demand of hybrid cars, the manufacturers need to target the mainstream lifestyle.

· Gas Mileage Contests

Like drag racing, gas mileage contests give the manufacturers of hybrid cars a great opportunity for research and development, but are not great for targeting the general public. When striving for any goal, having competition always helps you achieve more. The same holds true for gas mileage contests. This is great for the hybrid car companies, which are still perfecting how to squeeze every mile out of a gallon of gas. Like drag racing and endurance racing, gas mileage contests give the hybrid a chance to test its technology and continually improve on making the best hybrid possible.

Since gas mileage is a major motive for buying a hybrid, developing higher gas efficient cars is crucial to the hybrid industry. However, not many people care about these contests, and to call this a promotion is slightly ridiculous although these contests do allow the cars to get their name into some sort of spotlight.

The spotlight might be small, but at least the hybrid is getting some recognition and a great chance to improve upon their current model. The results from these events can serve as great information in other types of promotions like television commercials. In this way, the car companies seem to be effectively building to more aggressive mainstream marketing.

In all the current promotions, the target audiences have been very small and very specific. Most have relied on who shows up to watch an event that is not widely advertised, and therefore lacks a large target audience. While the hybrid idea is new in the USA and has not had a long time to catch on, the way for hybrid vehicles to become a larger percentage of the overall automotive industry is through mainstream marketing strategies. These types of marketing strategies include a wide variety of events, and when all these events are looked at collectively, the vast majority of the American public will be familiar with hybrid electric vehicles. This next section will deal with some ideas for marketing the hybrid-electric cars from target audiences and car names to television commercials and slogans.

Specific Group Focus

When promoting hybrid technology to the market, it is very important to focus on specific age/interest groups. There are such a variety of interests in the United States that it is difficult to narrow in on certain groups, so a good initial group division would be by age.

We narrowed our focus to four specific groups split up by age; 16-20 years old, 21-30 years old, 30-45 years old and 45 and above. These groups represent different stages in life consumers are at and are appropriate when considering consumer needs.

For each age division, we researched their current desires in automobiles, the most frequently bought cars in that age group and a good car to model a hybrid after. We created a name, slogan, commercial and promotional event idea for each of the four hybrid models and aim to show that hybrids can be much more popular in American society with a little time and effort.

Ø 16-20

• What this age group looks for when buying a car

When thinking about what any age group looks for when buying a car, it helps to look at the lifestyle characteristics of the particular target audience. At this stage in life, most people are still under their parent’s care and do not have a steady income of their own. If they have money, it is from a summer job or a little side job during the school year. This typically means that they do not have a huge sum of money ready to spend on an extravagant car. Considering that much of this age group is either in high school or college, image and reputation are important.

Based on these observations, this age group is mainly concerned about image and price. If this group could buy whatever car they wanted, then the decision would be based on the image or appearance of the car, but since they do not have a steady income, price constrains what they can choose from. Therefore, this age group is looking for the image they want to portray to others but at a cheap price.

• What type of car fits these assumptions about this age group

The Chrysler PT Cruiser corresponds to the desires of this age group. The PT cruiser is a car built around an image: “When the project was first started in 1994, Chrysler was searching for an image-building car” (Chrysler PT Cruiser Sports Utility Vehicle, USA). Also, the PT Cruiser is relatively cheap and can be purchased new for 17,000 dollars. Used PT cruisers can run cheaper by thousands, making them affordable for anyone. What makes this car a good example for this age group is that it can be easily converted into a hybrid driven car.

• Marketing Scheme for a Comparable Hybrid

Since the PT Cruiser was based off of an image, the body style is aesthetically pleasing, which is important for this target group. In order for a hybrid car to appeal to this target group, the hybrid’s body style must sacrifice some of its aerodynamic features in order to put more emphasis on a body style with an image. The image begins with the outward appearance. Presently, with only two hybrid cars on the market, no variety in body styles exist. It would be very easy to give the PT Cruiser a hybrid engine and attain a new hybrid with an appealing image.

Along with the “cool” body style and appearance, the name of the car is important. As an example, a car in this category could be named the “Crosswind.” This name hints towards nature and an outdoors type of image. Since a hybrid is good for the environment and the air we breathe, the use of “wind” as part of the name tries to direct a car buyer’s attention to the air he/she is breathing.

The main way to get a new idea into mainstream American life is through the television. Most people own one or watch them in restaurants. For this particular audience, a commercial could be shown during an episode of “The Simpsons.” This show is popular mainly among this age group, so the people watching at this time would be this target group.

The commercial itself would have very little to do with the car and more to do with the image of the car. One way to achieve this is to hire the Saturday Night Live members and give them complete control of a thirty second commercial. Hopefully what they come up with is funny, but the main point is that this commercial gets people laughing. It does not necessarily have to be about a hybrid car. Then at the end of the commercial a small five second segment could be devoted to the Crosswind. This five-second scene could show the car on the beach with the waves in the background. Having the car outside is the focus of this part of the commercial, so that viewers associate the vehicle with nature and the outdoors. When viewers associate the car with the outdoors, this will hint at the environmentally clean aspect of buying a hybrid car without making the car purely associated with the environment. The main idea is a laughing and fun image, not the environmentally clean image. When the five-second clip is shown, the slogan and price should be put underneath the image to get across the two main selling points.

The slogan should relate a fun image to the car. One possible slogan is: “All your friends can fit.” Since this target group is in school and the image associated with the car is laughter, this slogan combines high school and popularity with fun.

• Debut event

Two good ideas for the debut of the Crosswind are a hybrid car racing video game and a free or cheap concert. The video game would have nothing to do with the environmental side of hybrid cars, but it would show that these futuristic cars are fast and technically advanced.

Having a concert by one of the popular bands of the time would draw in many members of this age group. If the concert were free, then the venue would be practically full of potential car buyers. This would be a perfect time to advertise for the Crosswind. At one location on the outside of the amphitheatre, a Crosswind would be given away. This would appeal to the fact that target audience has very little money.

While this promotion may seem expensive, the rewards of gaining demand from this target audience are immeasurable. If this age group likes the hybrid vehicle, then they can buy many more in the future as they continue to buy more cars and acquire more assets. Drawing this age group in is essential for making the hybrid idea catch on in mainstream life.

Ø 21-30

• What this age group looks for when buying a car

This group is still looking for an image that is hip and young, but now they are concerned with performance and durability. The performance of the car is one of the most important factors, so it is crucial to have a HEV that is comparable to gas-powered automobiles in acceleration and speed. While this age group represents a group who has entered the working world, their average income is still relatively low. Having an affordable car that performs well and still gives off a sleek and sporty image would be ideal for a buyer in this age bracket.

Market research suggests that this age group typically buys a wide variety of makes and models. It is hard to narrow in on the specific brands to mimic the hybrid off of, but SUV’s, sporty sedans, coups, and convertibles are all hot items. The car basically needs style and performance with an affordable price. This age group is just starting out their careers and does not have the money to buy the top of the line automobiles. While there is no specific car that represents the entire group, you can easily pick a model that appeals to many of the desires this group has.

o Car that fits this age class

The very good reference car for this age group is the VW Passat. This car is sporty, speedy and fun while staying in most people’s price range. VW could make a very similar replica of the car while changing the innards to a hybrid engine instead of a fully gas-powered engine. The car would be called The Advantage because it has all the same capabilities as the Passat, yet it could get much better gas mileage.

The Advantage could be marketed with the slogan, “All you want in a car for half the gas.” This car would give the image of a fun and environmentally friendly car without seeming too much like a science project.

o Marketing scheme for a comparable hybrid

The main concern when addressing the consumer is proving that the HEV has equal performance and handling with the present gas-powered vehicles. The idea can be promoted through a competition between a gas-powered and hybrid powered vehicle to show their similar handling quality. The aim is to prove that HEV’s have similar handling while being able to go further distances without stopping for gas.

This idea could be promoted through a commercial where two ~twenty year-old brothers are competing to get to their parents house first. The older brother lives in the heart of the city and is a working, suit and tie kind of guy. The younger brother lives in the city as well, but does not really dress up for work and has the surfer appeal. They meet at one of their apartments and decide to race to their parents’ house in the country miles from the city.

The two brothers begin to race through the city traffic and both the gas-powered car and hybrid (which is the exact same model but with a hybrid engine) handle themselves well maneuvering in and out of traffic. By the time they get to the open road, both cars can drive along at the same speed and the race is still very close. As they near the country, however, the older brother in the gas-powered car has to stop for gas and the younger brother blows by him and wins the race.

The brothers reunite at their parents’ house and the younger brother buys the older brother a beer that night, because he has extra money from not buying the gas. The cars are almost identical, except for the fact that the hybrid needs less gas to do the same job.

o Debut Event

The debut event would play up the fact that you can make two cars with the exact same style and handling and one would have better gas mileage because it is a hybrid. A good place to promote The Advantage is at local speedways. Two identical looking cars would have a race and one would eventually have to stop for gas and the other could keep going and win the race. The drivers would be the newly famous “brothers” from the commercial.

A HEV SUV also would compete with a similar model of a gas-powered SUV to show that the two methods of powering a vehicle have similar performance. The two SUV’s could even drive around on an off-road course to show the capabilities of hybrids.

Ø 30-45

o What this age group looks for when buying a car

This age group is more focused on comfort and family needs than image. This age class represents people involved in a career and having a partner or family to care for. A car needs to be large enough to support all of their family’s needs. Safety is also very important because this age group has their family and loved ones to worry about. Reliability and performance must be very high to please this group and price is always a factor.

The types of cars most bought by this age bracket are sedans, SUV’s, station wagons and minivans. There are no specific car companies that monopolize this age group’s interests; all companies have the potential to please these consumers.

o Car that fits this group’s interests and needs

This group requires a well-sized, durable and comfortable car, and a sporty version of this would be ideal. A car that would fit these needs is a Subaru Outback station wagon (see figure below). This car is large enough to fit the family needs, cheap enough to remain in the family budget and has a sense of style that everyone is interested in.

A hybrid version of the Outback could be called the Coastal Cruiser to give a sense of excitement while still having the durability and size that is so important. The slogan that would represent this car would be “Less time for gas, more time for your family.” The station wagon would appeal to many consumers because it would not be marketed based on the hybrid power, it would be marketed based on the ability to fill the needs of the consumer.

o Marketing scheme for the Coastal Cruiser

The Coastal Cruiser is appealing because it can do the things that current family cars can do yet it is more environmentally minded and costs less for refueling. A commercial that would represent these ideas could be portrayed by showing a busy family, throwing sports equipment and camping gear in the car, then zooming off. It would look just like any car and drive like any car, but when you saw an X-ray view of the engine and structure of the car, you would see that the engine was different and that the exhaust was not producing as much waste.

The commercial would pan in to X-ray world and then back to reality. The point of the commercial would be that the car is cleaner for the environment and more technologically advanced internally, but the family members would never have to worry about any of that because they would have other things to worry about.

The HEV would have the exact same body as its gas-powered counterpart yet it would have this extra technology to make it cleaner and cheaper. In a Ward’s Dealer Online survey, ninety percent of the people interviewed said they would buy a hybrid if it were comparable to the car that they currently drove. These commercials would complete the new image of the hybrid showing that they are equal to current automobiles in most aspects and better in the rest.

o Debut Event

The debut for this hybrid would have to incorporate the target age group and their families. A fleet of Coastal Cruisers could drive up and down the two United States’ coasts and hold carnivals in towns to show off the cars. The environment would be kid-friendly while showing the advanced technology of the HEV’s.

This event would promote the awareness of hybrids to the general public and prove their capabilities. Only sixteen percent of people surveyed in the Ward’s survey said they would sacrifice horsepower and acceleration to get a hybrid vehicle, so the promotions would highlight the capable power of a hybrid. This promotion would initiate awareness in the American public and promote the sales of hybrids nationwide.

Ø 45 and Older

• What this age group looks for when buying a car

Like every target audience, taking a look at the lifestyle of this age group is helpful when trying to market a car to this group. One of the defining characteristics of this group is that their kids are starting to move out of the house. With the kids leaving the house, more money opens up for the parents who remain at home. Also, this group has a steady income and if they have had a steady job, they are getting higher pay because of promotions and a salary based on experience.

Based on these observations, this age group will look for luxury and comfort when buying a car. The money is available for buying the luxuries that could not be afforded before due to a lesser salary and children’s expenses. Now that the children have grown up and the task of raising children is complete, the reward of a new car and a more relaxing life are well deserved. A more relaxing life means a smoother riding car with leather seats and a classic but not flashy image.

• What type of car fits the assumptions made about this age group?

A car similar to the Cadillac DeVille would suit this age group’s motivations for buying a car. The Cadillac is a car that has a long history of prestige and class behind it. While the price may be higher than other cars at thirty five thousand dollars, this car provides the luxury of a smooth ride and large seats for a spacious travel. This car is precisely what this target group wants.

• Marketing Scheme for a Comparable Hybrid

The body style of this car can concentrate more on the aerodynamics as long as the style is a classic car shape. Concentrating solely on aerodynamics makes for a more radical looking car, and this age group looks for a more classic feel to a car because that is what they are used to seeing in a car.

The name of this classic looking luxury hybrid would be the “Primarium.” In Latin, “primarium” means first or distinguished. The fact that this word is Latin gives the name a classical feel, and the translation of the word represents the fact that this car is the first type of distinguished and luxurious hybrid vehicles.

Like the previous mainstream marketing ideas, the Primarium will be primarily marketed with advertisements on television. These commercials will play upon the relaxing image associated with this age group’s life style.

The commercial would start with an older man and his wife driving the Primarium on their way to their son’s new house that he just bought with his new wife. On the drive over, the car can be seen driving in the woods alongside a placid lake. The husband and wife look at each other and smile, but do not say anything in the commercial. Instead of talking during the commercial, classical Beethoven can be playing in the back ground as the car drives by the lake.

The car continues to the son’s house and the older couple gets out and meets their son and his wife on the house’s front lawn. They greet each other with hugs and smiles. Then, the younger couple’s kid comes running out of the front door of the house toward his grandparents. At that point the commercial cuts to a screen showing the name of the car only.

This commercial incorporates nature, family, and a relaxing drive. All of these factors are what this age group looks for when buying a new car.

With these promotional tools, hybrid vehicles would become much more popular to the American public. The media could greatly influence the popularity of the cars and the manufactures could make hybrids in already popular models. With this small change in the automotive society, the largest oil consuming country in the world could save billions and help create a cleaner environment for us to live.

Works Cited

Crary, David. The SUV conundrum: The most popular and most protested vehicle. http://www.thesunlink.com/redesign/2003-01-30/nationworld/61819.shtml.

Chrysler PT Cruiser Sports Utility Vehicle, USA. http://www.automotive-technology.com/projects/pt_cruiser/pt_cruiser3.

Mansfield, Duncan. Hybrid electric cars may pose risk to some workers. http://www.citizen-times.com/business_industry/hybrid_hazards.shtml.

Moore, Bill. Congress Focuses on PNGV Hybrid Electrics. http://evworld.com/archives/conferences/futurecar2000/bmoore2.html.

Parents.com - Top Cars for Families http://www.parents.com/articles/family_time/4334.jsp

Tank Tales: Hybrid Hot-Rodders Get Revved Up by MPG, Not MPH. June 6, 2002. http://www.evworld.com/databases/shownews.cfm?pageid=news060602-01.

The Chrysler Patriot. http://www.allpar.com/model/patriot.html.

Ward’s Dealer Business “Americans Would Buy Hybrids….If” May 1, 2002

http://wdb.wardsauto.com/ar/auto_americans_buy_hybrid_2/index.htm