“Brands are like pieces of fine crystal - they take time to create and are easy to break"
- Mike Isaacson
Brands are about trust
Who is a friend? A friend is someone whom you can trust, who never takes you for granted and who is absolutely reliable when it comes to the crunch. He does not let you down. And the test for a brand is to be a friend to a customer. Has Volkswagen at least the diesel version been this to its customers? Hardly and in fact has let down its targets whether its customers, investors or even the media is something that the brand will have to live down eventually. There is another interesting consequence of this. The scale of this impact will certainly affect the entire German economy and make people to be wary of German engineering which used to be such a big selling proposition in global markets.
I came into advertising over thirty years ago because I was inspired by it. It enthralled me. It fascinated me and I wanted to be part of this wonderful industry that fuelled dreams and sales. One of the ads that I really loved was the Volkswagen “think small” campaign which is given below.
What was so special about this ad and why did ‘Advertising age’ classify this ad as the greatest ad of the last century? Let’s go back in time to the sixties. The US has by and large been a vast country with great distances. People love big cars as it shows affluence - the larger your car, the more successful you were, etc. It was in this environment that Volkswagen launched the Beetle, a small car in a country that revered large cars. The car boldly flaunted its smallness and had ads that poked fun at itself like how a basketball player could not get into the car and how its parts were interchangeable. Ironically it was a German car when post war sentiment against the Germans was still strong and the Volkswagen was the car that Hitler proudly called the “people’s car”. Against the odds, the Volkswagen was a huge success. The Beetle was to become an iconic brand and Volkswagen has become one of the biggest successes globally selling millions of cars in multiple countries harping on its reliability and the strength of German engineering. The ad line in the middle would proclaim “If only everything in life was as reliable as a Volkswagen”.
From where to where
I am sure you have been following the news on Volkswagen in recent weeks where the auto major has been under increasing scrutiny and found wanting. To put it crudely it has been deceitful and fudged pollution tests in order to conform to standards and has faced ignominy, erosion of brand value. The numbers are mind boggling - 4,82,000 cars effected including every possible brand. Each vehicle could face a fine of 37,500 dollars and 18 billion the possible penalties the brand is likely to face and it may take two years before it can sell its diesel cars in the US and the stock has lost 20 percent of its value. To put it simply from my point of view, a brand that I admired enormously is now something that the world looks on with anger, suspicion and distrust. What a fall!
Brands take time to build
In today’s internet world a brand can be built in a shorter time frame compared to the old ‘brick and mortar’ world and we do have examples of brands like Google and Amazon that have been built in a shorter period than most others. But whether you are an internet company or an old world company - branding needs investment, consistency, resources and a clear vision to build. But at the cornerstone of the brand’s success is a reliable product or service. And this is where Volkswagen has failed. Its product has not delivered on accepted global standards and to make matters worse, they have deceived the world and it may take ages before people forget or forgive. It is difficult to forgive the treacherous act of your best friend. Many of us had given the status to Volkswagen, me as an admirer and I am sure several car users around the world. Now they feel cheated, angry and disillusioned. This is the impact that brands can have on people and that can be good when it works for you and disastrous when it is against you as Volkswagen is just realizing.
So remember to protect your brand, zealously as you would the most precious crystal in your collection and the very best of luck.