Page 2: The importance of public relations
‘Public relations practice is the planned and sustained effort to establish and maintain goodwill and mutual understanding between an organisation and its publics.’ (Institute of Public Relations)
It would have been impossible to transform the Skoda brand image overnight. It takes years to change perceptions and this is why public relations was key to Skoda’s rejuvenation. Public relations is essentially a long-term process, sending messages to the public, designed to build and develop the reputation of a brand over a period of time. Above all, public relations must work to a planned programme with clear objectives, and it must be sustained.
Although Skoda enjoys a premium brand image in central Europe (where the company originated), the situation in the UK has been very different. From the late 1940s through to 1989, Skoda manufactured in a communist-dominated market. This climate allowed little outside intervention in terms of modern technology and new ideas, and suppressed innovative and creative methods of working. In those days, its cars were cheap to buy but Skoda could not hope to compete on an equal footing with cars manufactured in the West and in such a competitive market-place.
The problem facing Skoda in changing its image in the UK was that the public’s view of the brand was outdated and lagged behind the reality of the product. Public perception of Skoda was poor and therefore relegated to the music hall jokes pioneered in the 1970s.
Volkswagen AG, Germany, bought Skoda Automobile, the state-owned Czech car manufacturer, in 1991. Volkswagen investment enabled Skoda to develop new products on a par with western competition and since then, increased its strength as a brand all over the world. Production has increased from 172,000 units in 1991 to 410,000 units in 1998, (138% increase) to keep up with customer demand.
A key strategy for developing demand for Skoda cars was brand building through public relations. It was essential to convert the negative feelings that many people had towards Skoda’s vehicles into positive perceptions. This is known as the PR transfer process. The negative perception surrounding Skoda, however, was carried over from the rear-engined vehicles produced in the 1970s to subsequent models like the Felicia, despite huge product improvements and brand offerings.
Skoda’s past image problem remained because the general public’s prompted awareness of Skoda, whilst very high at 94%, had not translated into awareness of 'new Skoda' as associated with Volkswagen ownership and of the new cars, the Felicia and Octavia. It was vitally important to educate the public on the Skoda proposition as the public’s understanding of the brand was out of date and misinformed.