Tuesday, February 2, 2010

Toyota Doesn't Get It

The Wall Street reporter from FOXNEWS on Imus in the Morning yesterday quoted auto analysts as predicting that Toyota is, and for a while will be, losing $150,000,000 per week in new car sales as a result of the recall due to "pedal sticking problems." (Today there are reports of brake problems with the Prius so that forecast could go way up). Toyota may lose $150,000,000 million or more in sales per week, but not because of the recall or the new Prius brake problem. Rather it'd be because of the way they continue to mishandle the outreach to their customers, present and potential, since discovering the problems.

Toyota manufactures and sells. I think that the skills that individuals employ to generate trust and sales, are not fundamentally different than those that companies should use to sell consumers on their brand. Honesty, good will and excellent service rank right at the top of those necessary sales attributes.

This is hardly the first time a quality product or service faced a disastrous consumer confidence setback. The Tylenol recall comes immediately to mind as does the breakdown in the AOL technical infrastructure after a marketing coup doubled or tripled usage overnight. The folk running and advising those companies at the time got it right. Confront the issue head on. Solve the problem. Communicate immediately, directly and honestly to every constituency. Remind your customer base how much you owe them and how little you won't do for them, including an immediate fix to the problem.

Toyota's misfortunes have been sharing the number one "breaking news spot" with the earthquake in Haiti and mass drug cartel murders in Juarez for more than a week. Yesterday I went to their WEB site (www.toyota.com). Ninety-five per cent of the home page displayed a brand new Toyota Highlander, beautifully shot against a pastoral background. In the very low left corner of the page (any WEB designer worth his salt will tell you that this is the least noticeable spot on any page) was a small bar entitled "recall information." It looked like the bar was placed there almost as an afterthought, rather than to honestly update the world on Toyota's effort to remedy the problem and well serve their customers.

Toyota makes a terrific car. But few folk are of a mind to go out of the way to buy one today. First we want to be assured that the problem has been solved; but we also want to be assured that we are cared about, that Toyota is sorry for the trouble and anxiety it has put so many of us through, and that it is prepared to make good in all cases where it has caused harm. In short, we want to be loved and protected.

Instead on their WEB page Toyota told us how much we ought to love them and their brand new Highlander. Jim Letz, head of Toyota in America, ought to have plastered the home page with his apology, fix and promises for the future. Then maybe he could talk to us about staying with or moving over to him.

Yesterday on NPR, Amy Eddings, reporter for All Things Considered, interviewed Mr. Letz as part of his press tour, and she asked a particularly interesting question: Letz had just explained that new Toyotas would have brand new accelerator "packages" to replace what might be defective ones, and recalled cars would be fitted with an oversight-approved metal "shim" which corrects the defect. Ms. Eddings asked, "what if an owner of a recalled car opted to have the whole package replaced rather than the "shim-fix?" Mr. Lentz replied that "would be a local dealer decision."

Excuse me Mr. Letz. In the face of very serious brand destruction, and with current and future disastrous potential consequences to Toyota owners, you want us to negotiate how well we will be treated by you and yours? And then you show us beautiful pictures of new Toyotas to buy at the same time. Uh, not sure you really get it, Sir.

Hey Toyota, search the case histories on the Tylenol recall and the AOL price change that brought their servers and service down, and see how the heads of those companies and their advisers blunted the adverse effect and grew their companies bigger than ever by communicating honestly and fearlesly with their consumers and demonstrating their respect and appreciation. Maybe you can borrow a page from their playbooks.

Great Selling!

Love Your Work and Work Tirelessly
Communicate Honestly and Fearlessly
Collapse Time
Serve, Don't Sell

1 comment:

  1. I hope Toyota is listening to you because they have really done everything to optimize their damages as you outlined.

    Maybe it's a cultural thing - pride and honor Japanese style? (another marketing lesson)