Subaru targets segments to drive business

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NEW YORK-- Be a little crazy and a lot smart, said a senior marketing executive while presenting a marketing case study for Subaru of America Inc. at The Conference Board's Marketing 2010 conference Nov. 1.

The presentation focused on how Subaru of America and The Porsche Group built niche brands using the metaphor of building a David brand in a world of Goliaths. Subaru owns both brands.

"Don't look in the rear view mirror, if you want to go forward," said Timothy Mahoney, senior vice president and chief marketing officer at Subaru of America, New York. "We had a lot of analysts tell us that bigger companies had more of an advantage than us, but we stayed forward focused and had success."

Mr. Mahoney said that one of Subaru's successes has been mixing the sport utility vehicle with a passenger car in its Outback model in order to appeal to the popularity of SUVs, but to ward off the bad reputations of bad gas mileage and poor safety.

Subaru marketed these cars with television spots featuring three women talking about their other SUVs. One embarrassed her children by driving a car that was not safe. Another embarrassed her husband by driving a gas-guzzler. The Outback gave the women the opportunity to appease their families and drive their desired car.

Mr. Mahoney attributed brand recognition to knowing the Japanese automaker's customers and using this knowledge to take good care of them.

Porsche, whose target audience is the sports car collector, sponsored a rare car collector event, for instance.

Subaru's demographic includes outdoors activities and sports oriented consumers, sponsored ski teams and athletes.

So it created a school where people could train with Olympic skiers. The company also created an outdoorsy character for Pixar's film "Cars," using product placement and free tickets to customers to build the brand image.

To find a new customer market, Subaru figured out consumers who would benefit from its car's design and targeted these segments.

For example, nurses, teachers and kayakers all need extra space to carry equipment and project gear, so the car maker made targeted ads for each of these segments to win new customers.

These are good marketing tools, according to Mr. Mahoney, where being the little guy in a land of big brands is all about caring for your audience.

"Use a laser as a slingshot but never a shot gun," Mr. Mahoney said. "The key to building a great brand is using the right tools. Don't get too excited about the latest trend in Ad Age if it's not right for your brand."

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