We identify with products in a variety of ways. At a simple level we may buy a coat in order to keep warm or a can of cola to drink. Consumer behaviour is a complex process and we all have complex motives for the things we do. There are probably types of coats we would not be prepared to wear or cans of cola we would not like to be seen drinking in public! A product is therefore not simply a way of keeping us warm or giving us something to drink, it is more than this. It does not meet a single need; the ownership and use of a product involves a whole range of factors which make up the product concept. At the heart of this is the process of branding.
A brand comprises a range of features which identify the products of an organisation. For example, a name, sign, term, symbol or other creative element. This case study focuses upon the rebirth of a much-loved brand with a unique British heritage - the MG.
The brand originated when Cecil Kimber became General Manager of the Morris Garages dealership in 1922. The business had been founded by William Morris before he became a car manufacturer and by this time was the Oxford outlet for Morris cars. Beginning with stylish coach built bodies on Morris chassis, he developed modifications for more sporting performance and handling. Probably without realising what a momentous decision he was taking, Kimber adopted the acronym ‘MG’ for his 1924 creations, which became known as ‘MG Supersports’ and making a shy appearance on these cars was a neat little octagonal motif incorporating those magic initials.
From 1925 a range of MG Super Sports models was offered and the sales success of the early MG cars was such that it became necessary to open a separate factory for their production. The MG Car Company came into being in 1930. The years before the war were classic ones with more than 30 different models available by 1939. Driving in the 1930s conjures up a stark contrast to the driving on the motorways of today. It creates images of narrow lanes surrounded by hedgerows, multi-directional signposts and a sense of exhilaration, combined with a feeling of new-found freedom supplied through engineering achievement.
Others identified with the virtues of owing something truly British and, after the war, MGs were sold overseas in large quantities, particularly in the USA. The MG Midget brought lowcost motoring for the MG enthusiast and continued in production until 1979. The MGB replaced the MGA in 1962 and was the mainstay of production until the end of 1980
Though MG versions of popular saloons such as the Metro, Maestro and Montego were produced during the 80s, they were not the affordable exhilarating sports cars of the past. To celebrate 30 years of the MGB a limited edition was launched in 1992.
Seventy years after Cecil Kimber had adopted the acronym ‘MG’ the brand had reached a low point in its existence. Its life had been distinct and memorable and, though it appeared to be dying, as we shall see, it was not yet dead!
The UK market
During the 1970s, the sports car market was dominated by product offerings from MG and Triumph. As these classic cars were progressively withdrawn, this led to a sharp contraction in this sector.
The UK market was badly affected by recession, with the volume of cars reducing dramatically from 2.3 million in 1989 to 1.57 million in 1992. Today the market for cars is divided into segments providing different types of vehicles, which satisfy the needs of different types of customers. An understanding of market segmentation and the different parts of a market enables an organisation to identify market opportunities.
Across Europe, over this period, the Coupe, Hot Hatch and Sports Car markets had all shown tremendous growth and the successive launches of new vehicles such as the Mazda MX-5, Toyota MR2 and Honda CRX in the Sports Car segment had stimulated expansion of the sector. As these models had shown, there were clear opportunities for new sports cars with the impact of expanding the sector for open-top motoring.
The Rover Group has always held a desire to re-enter the true sports car market. The priority during the 1980s was to replace its mainstream product range and a programme to build a new sports car was just not possible. In 1989 research identified growth of the sports car market and investigations were begun.
In early 1991, the Rover Group Executive Committee gave approval to the concept. Shortly afterwards styling properties were researched amongst owners and potential owners of sports cars and at the same time the information was updated upon the value of the MG Marque. By the end of 1992, the research and engineering feasibility work had reached a stage where the project could now be recommended to the Rover Group Board for approval. Approval was granted and a team of experts assembled to bring MG back to life.
The MG brand had always represented a window of opportunity. In the eyes of the motoring consumer, MG was a marque in suspension waiting to be redefined. Although other sports cars had been praised by the press, they did not carry the MG badge, symbolising a niche which traditionally belonged to British manufacturers.
From the beginning it was realised that the market had become much more discerning than in the previous years of MG and consumers’ expectations of quality, refinement and comfort had risen. It was important to emphasise modern design and technology and by taking these forward, build upon the past in order to create modern virtues.
The introduction of the MGF enabled Rover to revitalise the MG Marque in its purest form with AN AFFORDABLE TWO SEATER SPORTS CAR. When potential customers were asked to define the MG of the future, they felt that the opportunity did exist to have the leading sports car brand. They referred to classic British Heritage and the emotional appeal of MG. New MGs should be modern in DESIGN AND TECHNOLOGY and must be affordable both in terms of purchase price and running costs.
Rover Marque Values are developed and communicated throughout the Group. However, as with Land Rover products, customers differ from those of Rover Cars, so Marque Values for MG needed to be addressed separately. Following a process of research five Marque Values were developed:
- FUN ‘To drive an MGF is to experience the ultimate. It’s the time of your life and the pinnacle of your desire. It’s the most FUN you’ve ever had and it’s legal. Revel in rejecting the norm. Feel your heart beating faster.’
- ROMANCE ‘The ROMANCE, the desire. Memories of affection, of warmth, of respect. Remember the look, revel in the heritage and the beauty of line.’
- AGILITY ‘The AGILITY of the MGF is simply breathtaking. Taking the corners as if born to them, its lightweight handling and eager power are the mark of pure excellence.’
- OPENNESS ‘With its classless, straightforward appeal, the MGF personifies integrity. Approachable and honest, its OPENNESS cuts straight to the heart. With the wind in your hair you have found the reality.’
- AUDACITY ‘Be proud. Taste the adventure and assert yourself though the confidence and AUDACITY that is the MGF. Be part of the ‘wow’ factor, dare to be bold, dare to find the real you.’
The development of the MGF provided the opportunity for Rover Group to re-enter an exciting sector of the market, where it had not been represented for many years. Branding is, in itself, a form of product differentiation, which communicates quickly and effectively to consumers a great deal of information about a product.
From the early stages it was realised that the MG branding was a mixed blessing. On the one hand it provided many public relations opportunities, but the downside was that it might encourage people to look to the past rather than to the future. It was vital that the branding process was forward looking and concentrated as much on the product as it did on the MG marque.
Given the nature of the product it was recognised that dealer marketing of the new MG required a special approach. For the product to be successful it required special handling by a strategically positioned selective and enthusiastic network which could seek out new customers and deal thoroughly with their requirements. It was planned that all launches, including that in Japan, would be undertaken within a 6 month window when exposure to the brand was at a peak.
Even though a market may have been divided into segments, within each segment buyers will not have identical needs. Product positioning takes into account the thoughts and perceptions of customers to place a product relative to other products and brands. The position is, therefore, how the product is perceived in the minds of customers. References to it as a new Midget were to be avoided and, in terms of current competitive offerings, it should be compared against the Mazda MX-5 and to a lesser extent the Toyota MR2. Targeted customers will then create an image based upon the brand and its values which helps them to think about it in relation to other products.
The MGF was positioned as a modern designed sports car providing the owner with a balance between performance and affordability. Safety, security, crash worthiness, performance, handling and cost of ownership would all serve as key features in the product positioning process. The key feature of price positioning was affordability. The MGF was not just positioned in order to be targeted at the Sports Car segment of the market. It was also targeted at Hot Hatch, Cabriolet and Coupe markets.
Given the limited size of the current sports car market, it was immediately apparent that business would have to be captured from different market segments. Research looked significantly at how to draw sales in the Coupe, Hot Hatch, Cabriolet and Sports segments. Main driver profiles such as marital status, children in the household and multi-car households became a focus for attention. The findings indicated that a well executed sports car would conquest business from other market segments and identified the following as the key target audience:
- stylish people
- 25-45 years of age
- demographic profiles ABC1
- single or childless couples
- 70% male/30% female
- more than one car in household
- car will be used as main means of transport.
Although it was expected that enthusiasts would show interest in the MGF, this was regarded as a smaller market in terms of sales potential.
The key element of a communication strategy is to send the correct messages through to potential customers in order to develop their awareness and understanding. The launch of the MGF was to be viewed as more than just another new car launch. It was to be viewed as the re-emergence of the famous MG marque in its truest form, an affordable two seater sports car. The modernity of the design and style speak for themselves, but there are a number of MG cues on the exterior, such as the headlights, grille and badge which are clearly from the MG stable.
In June 1994, market research was undertaken in the UK, France, Germany and Italy to try to understand the MGF’s likely unique selling propositions, in order to develop a European communication strategy. It was found that there were no major differences in perceptions of the MG marque, except in the UK. Here, MG is regarded as familiar, whilst in Continental Europe, although MG is a more distant memory, it is held in much higher esteem.
Prior to the product being revealed, the strategy was that the company would continue its ‘no comment’ stance. The product was finally revealed at the Geneva Motor Show in March 1995 and was accompanied by a press statement and product briefing. During September 1995 an International press event was held for key journalists in the markets where the MGF was to be sold. At that time, press packs were released to a wider audience.
Overseas, MGF launches followed product reveals at the major motor shows, including Tokyo, in order to maximise PR opportunities. Throughout this time, press statements were issued to maintain its high profile. Press demonstrators were available for the local press ahead of product launches.
It was important for Rover to make sure that it chose the most appropriate route through to the consumer. Although Rover dealers are able to sell lower priced volume products successfully, they were inexperienced at marketing niche products. It was felt that a new approach to franchising would be necessary if the MGF was to get the highest level of focus. From a customer’s viewpoint, the following criteria were essential from a dealership:
- a sales person must be knowledgeable about the car and be able to give guidance on areas such as insurance.
- ability to view and test drive vehicle without delay.
- a dealer should be well recognised as having an MG franchise and be able to supply support literature.
- a dealer should supply a full after sales support service.
It was decided to franchise the car selectively, laying down a number of minimum standards such as a trained sales specialist, point of sale (POS) merchandising, trained service technicians, to which the successful dealer would need to comply. The right to distribute the MGF would follow the submission of a business plan. A different approach to selling was important when distributing a car with such a unique heritage.
Detailed work on the launch of the MGF started soon after the programme to develop the product was approved! The strategy needed to recognise that the introduction of the MGF was more than a new model launch; it was the revival of a famous motoring marquee which would attract world media coverage. It was important to create an awareness of the product to provide dealers with the chance to pre-sell the car. Pre-launch objectives were:
- to achieve clear brand positioning
- high profile exposure
- demonstrator/display cars at dealerships for launches
- co-ordinated world-wide approach
- to optimise PR coverage
- to optimise sales and profit opportunities
- for networks to take advance orders.
No business can remain static. Following the successful launch it is not a case of ‘we have done it, that’s it.’ The launch of the ‘Heritage’ Programme helps to develop the bespoke values of the MG tradition and will provide customised cars to emphasise the marque values. Rover also has to carefully evaluate the success of the MGF and consider how to develop its sports car strategy in conjunction with BMW.
In 1995 the MG brand was reborn. It has come back not just because those who remember the MG have yearned for its return, but also because of the commitment of the project team involved in developing it. A project team of 30 engineers and technicians spent three years bringing the car into production. Over that time they changed location on three occasions. Their reward has been the building of a car with a character to revive the marque and to provide customers with what they set out to build, quite simply: ‘The World’s Most Enjoyable Car to Drive’.
MG Car Company | The rebirth of the MGF