Car Buyers Finding Fewer Options When It Comes to Options

When it comes to ordering new cars, buyers are finding you can't always get what you want.

Automakers are drastically cutting the potential combinations of trim levels and options in a trend that recently has accelerated:

• Buick offers its new Verano compact in only 18 potential combinations of trims and options.
• Volkswagen slashed the ways you can order a Passat midsize sedan from 148 to 15.
• Toyota cut the ordering complexity of its current-generation Sienna minivan by 80%.

Automakers say fewer choices lead to higher quality because they perfect the few configurations. It avoids "creating complexity for the sake of complexity," says Chuck Russell, General Motors director of compact cars in North America.

It also cuts costs with fewer combinations to plan for and track on assembly lines. And it simplifies inventory planning for dealers.

One way automakers cut complexity is to herd options into "packages." Sienna's "preferred" package, for example, bundles power side doors with satellite radio. To get a Passat with a sunroof, you also must buy the premium sound system.

The potential downside: "You end up buying things you don't want or need in order to get things you do want or need," says John O'Dell, a senior editor for car research site Edmunds.com.

But automakers say the lower costs may be passed on to buyers and that they've gotten better at figuring out bundles buyers want.

"It's actually a relief. They are removing the work of trying to figure out what I want," says Kristen Andersson, senior analyst for shopping site TrueCar.com, who says buyers can even end up happier, with goodies they wouldn't have ordered but later love.

Not all makers are embracing the trend. High-end brands are more likely to still let buyers pick and choose. About 30% of Porsche buyers, for instance, custom order their cars. "It's expensive to do it the way we do it," spokesman Dave Engelman says. "It slows down the assembly line."

And even mainstream makers are going that way for key models.

Chrysler Group, for example, has cut combinations on many vehicles, reducing the number of ways you can order some of its biggest-selling vehicles for 2012, like the Dodge Durango crossover or the Grand Caravan minivan. It reduced trim levels to five, down from 12. But for its $15,995-to-start, all-new 2013 Dodge Dart compact, it is allowing custom factory orders in up to 100,000 combinations.

Dodge Director Richard Cox says à la carte choices include "citrus peel" paint -- a "vivid greeny yellow" -- and push-button ignition. "They might want the 8.4-inch touch-screen but don't want navigation. We give them the ability to get that (without having to buy) a $3,000 package."

How does a plant handle that without driving up cost? "World-class manufacturing," says Cox.

(Source: USA Today, 02/27/12)

Sizzling February Sales Point to a Bigger Year

New-vehicle sales are on fire in February, by almost all accounts. Now forecasters are recalculating -- and figuring on a bigger year than they expected just weeks ago.

The February selling rate is expected to hit 14 million units for a second straight month -- a surge that has prompted several analysts to boost their full-year forecasts for 2012.

J.D. Power and Associates expects February's seasonally adjusted annual rate of sales to be 14.0 million. TrueCar.com predicts a 14.3 million SAAR for the month, topping January's 14.2 million rate and up a million units from February 2011.

"This looks like the real deal," said TrueCar analyst Jesse Toprak.

Retail sales are driving the growth, said John Humphrey, Power's head of global automotive operations. He expects a retail SAAR of 12.0 million for the month, up from 11.0 million a year earlier, which would compensate for relatively lighter fleet volume.

"We're increasingly confident that the fundamentals are in place to support an upbeat outlook for the coming year," Humphrey said.

Carmakers and dealers are sounding buoyant, too.

"We're seeing some positive sales momentum in February," said Erich Merkle, Ford's chief sales analyst. "We're on a nice pace, a healthy sales increase over last year."

Many analysts are convinced that the market has shaken off its mid-2011 swoon and is in a sustained recovery from its 2009 low of 10.4 million unit sales. Indeed, February looks to be the sixth straight month with selling rates above 13 million.

Toprak forecast that February industry incentives would fall about $100 a unit from a year ago.

"We're selling the car, not the price," he said.

Since December, several independent forecasters have raised their 2012 outlooks.

Last week, IHS Automotive and Kelley Blue Book revised their forecasts to 13.6 million, up from 13.3 million. LMC Automotive, J.D. Power's forecasting partner, moved to 14.0 million from 13.8 million. TrueCar.com also moved to 14.0 million from 13.8 million, although Toprak said the change won't be official until after February sales are reported on Thursday.

Not everybody has changed since December. Morgan Stanley is sticking with its 2012 forecast of 14 million, said top analyst Adam Jonas. Polk is still at 13.7 million, although analyst Tom Libby said it will review that figure once February results are in.

Jeff Schuster, senior vice president of forecasting for LMC Automotive, said pent-up demand, greater credit availability and a rebound in leasing are helping boost auto sales this year.

"Overall, the economy is in a little better position," he said. "Two months is not a trend, but since September, we're seeing some (auto sales) consistency and we're easing back on the risk factors."

Toprak cited better economic fundamentals and pending 2012 introductions of "a slew of new products that give consumers the best choices they've ever had."

In addition, more leasing, low-interest car loans and greater lender competition for auto business are driving sales growth, he said.

Lenders have cut new-vehicle loan rates to the lowest level in at least four years, Experian Automotive reported last week. The research firm said the reason is that the cost of money is low and fewer car buyers are delinquent. The average interest rate for a new-vehicle loan fell to 4.52 percent in the fourth quarter from 4.84 percent a year earlier.

Despite adding 300,000 units to its 2012 forecast, IHS Automotive is carefully monitoring rising fuel prices and the potential for the European debt crisis to affect U.S. sales, said analyst Chris Hopson.

"Gasoline prices could hit a tipping point that would affect auto sales volume and not just the mix," he said. The five publicly traded dealership groups that have reported fourth-quarter financial results in recent weeks all cite robust sales so far in 2012.

"It feels like things are loosening up," said Lithia Motors COO Bryan DeBoer last week. "Through the first half of February things are looking pretty solid."

(Source: Automotive News, 02/27/12)

Taking Personal Accountability

It's a given customers feel more secure agreeing to do business with a salesperson who has their best interests at heart.

One of the most effective ways to convey that sentiment is by taking personal accountability for ensuring all issues are resolved quickly, and -- more importantly -- the customer is satisfied with the outcome.

It might even be helpful to let prospects know during the initial selling process that you're always available to answer any questions they have.

This way, the two of you are in sync every step of the way, which ensures you'll be the first to know when or if any issue does arise.

More importantly, it allows salespeople to transform the occasional service issue into an opportunity to build trust, increase loyalty, and, ultimately, create the type of customer relationships great businesses are built upon.

Consumers Weigh Causes and Prices Before Buying

Food retailers and CPG manufacturers that align with charitable causes largely move consumers -– but not completely.

One-third of consumers (33.1%) say the strategy doesn't make them likelier to shop in a particular supermarket; just 13.3% say it does, according to findings of the 2012 National Grocers Association-SupermarketGuru Consumer Panel Survey Report. Notably, consumers who say "no" the most are the nation's heaviest grocery spenders (36.8% of this group that spends $101 and more per week).

For the majority of consumers overall (53.6%), it depends -– on the store's prices, or on the causes it supports, or on a combination of both. People understand that charitable causes help others in need, but tough times are pretty much everywhere these days, and many already give in other ways beyond what a food store or food brand might do. So there's a limit to the charity they'll connect to their food shopping.

This resistance emerges if people don't feel as strongly about a particular cause, or if they think a store or brand inflates prices in order to deliver the support it messages about. For example, 10.9% say it depends on the causes. Another 15.8% say it depends on the prices. And 26.9% say it depends on both causes and prices.

What if prices rose to allow for donations? That would be fine for 56.7% of U.S. adults surveyed, as long as the price difference was no more than 2%. However, it would be OK with only 10.1% of consumers if the price difference swelled to as much as 5%. For a full one-third of respondents (33.2%), the amount of price difference wouldn't matter.

Related, if charitable support was keyed to a retailer's private label sales, and those prices rose, 62.3% of consumers say they'd still buy their usual amount of store brand items. About one-quarter of consumers (25.3%) say they would buy less, and 12.4% say they would actually buy more.

Will a "causes" strategy help a supermarket pull consumers from wider geographic areas? Not for most consumers, the survey findings show. A majority (53.9%) says it won't travel any farther to shop in a food store that supports causes. However, 24.2% say they would travel up to a mile or two longer, 16.1% say they would travel up to five miles more, and 5.7% say they would travel up to 10 miles farther to support a supermarket that supports causes.

Which causes are uppermost in consumers' minds today? Their Top Five (respondents could name multiple responses) are: relieving hunger (54.8%), relieving child hunger (39.9%), education (30.8%), supporting people in disaster-stricken areas (28.5%), and the environment (23.2%).

(Source: The Lempert Report, 02/14/12)

Generating Referrals

Get your client on-board to give referrals. Most sellers wait until after the sale has been completed before they bring up the idea of referrals.

Bad idea.

Most clients need time to get comfortable with the idea of giving referrals, so bring up referrals early in the relationship. Don't ask for referrals; just let your client know that your business is built on referrals and then drop referral seeds as the sale progresses.

Since your prospects and clients aren't stupid, if they hear you mention referrals often in a casual manner, they'll get the impression referrals are important to you and they will be expecting you to ask for them at some point.

What You're Going to Need to Know About Pinterest

Talking about an online social network where users share interests undoubtedly sounds kind of redundant nowadays. But it is true that the great success of Pinterest shows that surfers apparently have a need that still hasn't been adequately satisfied by the web's most popular social networks.

This social network, based on its capacity to share images and content available on the web in a practical and simple way, has just been singled out by the specialist media site TechCrunch as the best new startup of 2011, and it's threatening to become the new shining star of the social networks. Even so, its co-founder, Ben Silberman, doesn't want to talk about the figures that show the growth of the platform, and prefers to underline its design and capacity to unite people according to their interests as the reason for its success.

An image is still worth a thousand words

The new web that has its finger on the pulse of the evolution of social media is a platform that consists mainly of links and images, an eminently visual tool with an emphasis on photography. What does the name mean? Share your interests. Ben Silberman says, "Pinterest is a site that connects people who are passionate about the same things. In the same way that people use Facebook are excited to connect with people they care about, people on Pinterest are excited to be inspired by people with similar tastes."

Returning to the images, the idea of Pinterest is very simple. The site is a kind of virtual pinboard, where users pin an image, a product or content that interests them. Then it's published on a kind of online-advert noticeboard and can be seen by other users. The user can pin web content or repin what other Pinterest users have already shared so that it forms part of their own interests. "It's like storing favorites on your computer, but in a public way," explains one fan of the new platform. There are no walls, no friends, or anything remotely similar. Images and interests are shared revealing a common link between two people, without the need to leave a message, although you can if you want.

With a simple glance at the home screens of different users one can find out about their passions and interests and recognize people who have the same tastes as us. The new platform's public is mainly female. This is what TechCrunch says, citing that 59 percent of Pinterest users are women between the ages of 25 and 44, mainly arts and design professionals. According to the online-traffic measuring site Alexa, Pinterest occupies the number 26 spot on the list of most-visited sites in the United States, and number 126 in the world.

The value is in the generation of traffic

It is true that Pinterest has become more than just a relevant site for the recommendation of services, businesses and small companies. Its simplicity and user-friendliness are undoubtedly factors that favor its rapid rise and adoption. But the real value of Pinterest lies in its demonstrated capacity to send traffic to other websites. According to a recent study by the company Shareaholic, in July 2011, 0.17 percent of Internet traffic came from links shared by Pinterest. By January 2012, the figure had risen to a surprising 3.6 percent, a volume that exceeds the total traffic redirected by sites such as Google+, Linkedin, MySpace and Tumbir combined.

To all this has to be added the fact that Pinterest is so far an invitation-only site to which you can only have access if you receive an invitation from another user, which means its expansion potential still hasn't reached its peak. Of course, the platform has already attracted the attention of the big brands that see the tool as a powerful way of marketing their goods and services. The idea of selecting content, filtering, organizing and sharing it online with a click takes online viralization to its maximum simplicity. Pinterest has already won the Crunchie Award for Best New Startup of 2011, and clearly its recent expansion appears to be beginning. If it manages to consolidate its growth and continues to be an effective tool for sending visitors to other websites, it's possible that it could convert itself into an essential platform for any online marketing and communication strategy.

(Source: Adotas, 02/20/12)

Is $4.50 a Gallon the New Gas Price 'Wall'?

Industry observers keep wondering what it would take to produce a wholesale shift in the American automotive marketplace. Despite near-record prices last Spring and the brief push to $4 a gallon several years earlier, U.S. motorists have largely continued buying the products they've always bought.

But a new survey suggests the market could hit a "wall" at $4.50 a gallon, with nearly nine of every 10 "new-vehicle intenders" telling CNW Marketing they would purchase a more fuel-efficient model "immediately" were prices to reach that level. And the vast majority of those buyers said they would specifically be in the market for a hybrid.

"Toss in the possibility of $5 per gallon gasoline," said CNW Marketing director Art Spinella, and the study would suggest the hybrid -- and presumably electric -- vehicle markets should "explode."

Or will they?

In recent years, whenever motorists were asked to speculate about what they'd do following a big fuel price spike they have predicted a sizable shift to more fuel-efficient products, whether switching from big SUVs to compact crossovers or from V-8s to hybrids. But, notes Spinella, that paradigm shift has yet to materialize.

Indeed, industry sales data reveals that hybrid sales actually slumped in 2011, despite the spring price hikes. For the year as a whole, all forms of battery-based products -– from mild hybrids like the Honda Insight to full battery-electric vehicles such as the Nissan Leaf -– totaled less than 3% of the overall market. And fully half of those sales were made up by just one model, the Toyota Prius, which has become the poster child of the green scene.

There have been some shifts: the full-size pickup segment has lost several points of market share, for example, with so-called personal-use buyers largely migrating to other segments. But there's been none of the wholesale shifting to compact and smaller products that some analysts had predicted.

And that should be no surprise. Earlier surveys routinely predicted dire results when motorists were asked about gas price hikes of as little as 50 cents to a dollar a gallon, results that failed to materialize when prices did, in fact, go from $2.00 to $2.50 to $3.00 and higher.

In April 2006, when gas averaged $2.75 in the U.S., noted Spinella, 45% of new car intenders said they'd consider a hybrid when the pump price reached $3.75. A year ago, 93% of buyers said they'd be hunting for a new, fuel-efficient model if prices stayed around $4.

With prices now nudging $4, the latest CNW survey probed the impact of $4.50 gas. It found 87% of buyers saying that'd be the trigger for a switch, with fully 93% of those intenders saying they'd take a serious look at a hybrid.

If past is prologue, the reality is likely to be far less substantial. Ever since the twin oil shocks of the 1970s, U.S. motorists initially panic then settle back to buy the vehicles that best suit their needs and budgets, even if that means higher fuel bills.

They're more likely to respond by curbing their driving, if recent federal mileage data is any indication. U.S. motorists have been steadily reducing their travel over the last several years. And the latest CNW Marketing survey found 87.6% of American motorists overall said they would drive "significantly less" if fuel prices topped $5 a gallon.

(Source: The Detroit Bureau, 02/20/12)

Agencies Show Their Age on Mobile

Mobile platforms and engagement strategies in our digitally enabled world need to support all marketing initiatives.

Mobile strategy is about more than just phones. Mobile platforms and engagement strategies in our digitally enabled world need to support all marketing initiatives, both offline and online, and be truly multi-channel. Mobile maturity is one area, however, where brands and agencies are playing catch-up with consumer demand.

A siloed approach to mobile has been commonplace over the past couple of years. Many agencies have supplemented traditional creative with mobile ads that lack a larger strategy, subbing out app development that offers no real value and failing to thoughtfully consider the best platforms and devices for mobile campaigns.

For example, Shazam recently made a splash by enabling second screen synchronization with the Super Bowl broadcast, and the company says it saw record engagement during the game. Unfortunately, problems arose because not all hub pages were optimized and users had to complete Bud Light's age verification screen on a screen that was not touch-friendly. Considering the large number of iPhones participating, it should have also linked straight to the promoted song on iTunes, instead of emailing it a day later. It's likely that there was a lot of user drop-off, especially given the three-step process.

Missed opportunities like this will become less common over the next year as brands and agencies fight to stay ahead of the curve, proving 2012 will be a game-changer for mobile.

This shift to a more optimized mobile experience is not merely because the industry is a year older, but because enough agency and brand leadership are seeing a critical mass of mobile and multi-channel initiatives bear fruit. Marketers are realizing the growing risk of doing nothing.

This year, the market demands a more entrepreneurial mindset. Mobile is not just the hot topic of the moment — it's the future.

Embracing this reality requires a shift in thinking and many brands still do not have a mobile or encompassing digital strategy in place. Moreover, many agencies are still growing a set of basic mobile capabilities. Creating both smartphone and tablet-optimized experiences, along with the increasing need to pick platforms and develop apps, is becoming the norm.

Last but not least, 2012 is begging for brands to truly integrate mobile with commerce and CRM programs, and create new integrated experiences for in-store, at home and on-the-go.

While 2012 brings a new confidence to place bigger investment bets in mobile, here are some tips and trends to consider:

• Look at all of the touch points and device considerations that surround a mobile campaign. Consider environmental conditions like in-store Wi-Fi, device detection and fallback tactics such as developing SMS or mobile web alternatives to more specialized mobile tactics.
• As mobile becomes more integrated with other touch points, the need to get store Ops and IT involved becomes a critical success factor. Pick an agency that knows how to work intimately with all facets of your organization.
• On the flip side, some agencies and platform providers are so bent on serving every device that the entire experience gets "dumbed down" so far that it doesn't engage anyone effectively, especially the smartphone crowd that is more likely to participate. Know what devices to optimize for and how far to take it. Remember not to just look at today's device penetration for a market, but also the consumer behavior that goes with it and where the trend lines point.
• As the promise of enterprise mobile solutions and point of sales integration continues to heat up, plan for concepts and pilots that set a bigger stage for follow-on investment.
• 2012 will be the year of getting websites and relevant marketing assets optimized for tablets, not just smartphones -- especially as tablets continue to heat up for mobile commerce and chip away at market share for everyday PC tasks.
• "Big Data" is back as a buzzword and unsurprisingly so; the more multiple channels are connected, the more we need data to serve up the right experience to the right prospect and customer. There is a lot of opportunity here with location-based service integration and better behavioral and preference-based targeting. However, most of the real benefits won't be realized until 2013-2014.
• As most direct consumer brands have a mobile app of some sort, expect to see enhancements that bring context aware features, embedded loyalty, and in some cases pre-paid and mobile wallet capabilities.
• Much of 2011's mobile marketing budgets were still made up of slush fund ad budgets. Expect to see more purposeful campaigns and sizable budgets set aside for mobile.
• Look to work with agencies and partners that don't just put a person in the room that "gets mobile" but has shown they can deliver it across channels and touch points.

Various agencies and brands sit in very different places across the mobile and multi-channel maturity curve. In 2012, those that don't figure out mobile will really start to show their declining relevancy to today's consumer.

(Source: David Hewitt, VP at digital agency SapientNitro, Tech Crunch, 02/11/12)

Internet-Only TV Homes Surge 22.8%, Spend 9% of TV Time Online

Households continue to cut cable/satellite - turn to broadcast and streaming.
Characterizing it as a "development to watch," Nielsen issued a new report to clients last week showing that the number of U.S. households that bypass cable or satellite TV and subscribe only to broadband Internet access has grown dramatically in the past year, and not surprisingly, they spend dramatically more time watching TV over the Internet.

The Nielsen report said it is too soon to determine whether these households are so-called "cord-swappers" -– swapping the cable/satellite TV cord for the broadband Internet cord -– but they are growing faster than any other segment of the "cross-platform" television marketplace.

While the percentage of Internet-only TV homes is still relatively small -– less than 5% of all TV households -– they grew 22.8% over the past year, according to the report, which reflects data for the third quarter of 2011 vs. the third quarter of 2010.

Not surprisingly, these households are streaming more than twice as much TV online as the general population: an average of 11.2 minutes daily vs. 5.0 minutes for all TV households. While these households are relatively low users of TV -– at about half as much as the time spent watching TV by the general population –- they currently are watching more than 9% of all their TV minutes online. According to Nielsen's data, the average TV household currently is watching about 1.9% of their total TV minutes online.

"The increase in broadcast-only/broadband homes is the most significant of any category, though it is not necessarily an indication of downgrading services," reads the Nielsen report. "Rather, this could reflect broadcast-only homes upgrading to broadband as their needs change. Further underscoring the importance placed on broadband Internet, the number of homes subscribing to cable-plus and no broadband decreased 17.1 percent since last year."

(Source: Media Daily News, 02/09/12)

Does 'Liking' a Brand Drive User Loyalty?

When it comes to Facebook "likes," social network users are sending brand marketers mixed signals. An eVoc Insights study indicates 59% of Facebook users have "liked" a Facebook brand or company page in the past six months.

Although this statistic may seem promising for brands, how "liking" a brand connects with consumer loyalty is still vague.

When surveyed by eVoc, 54% of users who "liked" a brand or company page on Facebook that sells a product or service said they were somewhat or much more likely to purchase from that brand. The study confirms that the most "liked" pages are for food brands, TV shows, music, movies and clothing.

Although the eVoc Insight statistic suggests more than half of consumers are agreeable toward purchasing from the brands on Facebook, consumer behavior suggests otherwise. According to a study from the Ehrenberg-Bass Institute, an Australia-based marketing think tank, just 1% of fans of the biggest brands on Facebook engage with the brands on the site.

The Ehrenberg-Bass Institute study looked at Facebook metrics for the top 200 brands, and through an examination of activities such as "likes," comments, posts and shares, the research group found nothing substantial to link a brand's Facebook presence with loyalty.

Limited consumer engagement with brands on Facebook suggests there may be a disconnect between the reasons why consumers actually "like" a brand and the reasons brands think consumers are "liking" their page. When the CMO Council asked Facebook users in Q4 2011 about their expectations after "liking" a brand on Facebook, the top expectation (67%) was to be "eligible for exclusive offers."

However, when the CMO Council asked marketers what they thought it meant when a consumer "liked" their brand page, a quarter of marketer respondents answered, "because they are loyal customers."

The link between "likes" and loyalty remains unclear. Although consumers respond favorably about their likelihood to purchase from a brand they follow on Facebook, that's not overly evident on their Facebook timelines.

Marketers should keep in mind that for consumers, Facebook remains primarily a place to interact with peers and share experiences. Although many consumers have opened up to brands that are present on Facebook, brand marketers should not expect loyalty each time a consumer clicks the "like" button.

(Source: eMarketer, 02/08/12)

Finding the Right Sales Mentor

Lately I've been hearing a lot of pretty successful people talking about how much they owe their achievements to their mentors. From vice presidents of sales to sales reps to business owners, they attribute their accomplishments, at least in part, to having a mentor to guide them.

Often though, salespeople who aspire to be the best don't have anyone to help them find the way. One of the biggest reasons may be that they don't know where to look.

Here are five tips to help you find your right sales mentor:

1. Think about what you need a mentor for. The first step toward finding a good sales mentor is to think about what you're actually hoping to gain from the relationship. Is it a sense of perspective on your career or territory, someone who can help you overcome a particularly difficult challenge you're facing, or something else? Be clear with your objective.

2. Find someone who is successful, positive, and a good listener. Look for a mentor with proven sales success, experience overcoming challenges and achieving goals that are similar to your own. He or she should offer a sounding board for the sales and career issues you're facing. Understanding what you're going through will allow your mentor to give valuable input, hold you accountable to your objectives, and push you to do your very best. Your mentor is your coach and cheerleader!

3. Your mentor shouldn't be your manager. While your sales manager may fill a mentor-like role in many ways, it's a good idea to have a separate person as your mentor. Why? Because you want to be able to speak openly. For example, you may have set a goal to sell double your quota. Your mentor can help you develop the strategy to do it, then push you to accomplish it. But your mentor won't forecast it like your manager might. Your mentor is your confidant and strategist.

4. Don't be afraid to consider mentors from other industries or backgrounds. There's no rule that says your mentor has to have, or have had, a similar sales job to the one you have. In fact, advice and guidance from a mentor who doesn't work in your field could yield an entirely new perspective. Because they're starting with a blank slate, they may be able to ask the kinds of questions that will lead you to an inspiration that you wouldn't have found otherwise.

5. It's okay to have multiple mentors. As you consider the benefits of having a sales mentor, you may find that it's beneficial to have more than one. For example, if you aspire to a sales executive role, a sales executive mentor would be invaluable. At the same time, if your strategy to get there is by growing alliance partner relationships for the company, having a mentor with experience there is also important. You don't want to have so many mentors that there isn't time to put their advice into action, but don't be afraid to approach more than one.

A mentor can catapult your success and once you start looking, you'll notice potential candidates all around you. Set an appointment to talk over coffee. You might be surprised at how open they are to helping, and just how much you'll gain from the experience!

The Importance of Sponsor Cross-Promotions

Properties Can Add Value by Facilitating Cross-Promotional Opportunities Among Their Corporate Partners

While marketers have long touted the benefits of sponsor cross-promotions, many rightsholders still fall short in facilitating cross-marketing opportunities among their corporate partners.

And with budget-challenged companies continuing to scrutinize every marketing expenditure, the need for cross-promotions has never been greater.

"Properties should place more emphasis on cross-promotions, especially in this new sponsorship world we live in. All sponsors are being asked to do more with less, and properties must realize that cross-promotions are a great way to achieve multiple results on behalf of their sponsors," said John Vaughn, manager of sponsorships and events with Advance Auto Parts, Inc.

Case in point: Advance Auto has boosted the number of sweepstake registrants around its sponsorship of the Big South Conference by working with other sponsors on a joint promotion. The sweeps generates roughly 50,000 registrants, up from several thousand when the retailer ran the promo on its own.

"When we started the sponsorship every sponsor was implementing its own promotion. We quickly realized there is power in numbers and that together we could put something together with much greater appeal," said Vaughn.

Cross-promotions also can provide sponsors exposure in non-traditional marketing channels. American Honda Motor Co. last year gained vehicle display space in Macy, Inc.'s outlets as a result of its participation in an IZOD IndyCar Series promotion with Phillips-Van Heusen Corp.'s IZOD brand.

The Civic Racing Style Sweepstakes presented by IZOD was promoted through an in-store display that featured a Honda Civic. The apparel company passed-through the promotion to Macy's, a key retail partner.

"Most people don't expect to see a vehicle in a clothing retailer. It gave Honda a clear message in an uncluttered environment," said Greg Gruning, IndyCar's executive vice president of corporate business development.

Sponsors also can use cross-promotions to access new inventory for promotions. Subaru of America, Inc. last year leveraged its presenting sponsorship of the Down & Dirty National Mud and Obstacle Series with Wolverine World Wide, Inc.'s Merrell shoe line, the series' title sponsor.

Subaru activated the partnership by offering a $100 Merrell gift certificate to consumers that took a test drive.

"We were able to drive traffic to our dealerships while introducing consumers to the Merrell brand. It was a win for us, a win for Merrell and a win for consumers that took advantage of the offer," said Todd Lawrence, Subaru's promotions and sponsorship manager.

While sponsor cross-promotions can be valuable, many properties fall short in facilitating the relationships, he added.

"Cross-promotions should be low-hanging fruit for properties. Even if a cross-promotion doesn't happen for a particular event, sponsors will always appreciate an introduction to brands that share similar customers."

And if building relations with sponsors isn't enough, sponsor cross-promotions also benefit properties by providing additional marketing exposure.

"Sponsor cross-promotions are important for two reasons: Companies can get a better return from their sponsorship, and they also help promote our sport," said Gary Darcy, senior vice president of sales and marketing with the NHRA.

(Source: IEG Sponsorship Report, 01/30/12)

Big Retailers Say They Won't Neglect Used-Vehicle Sales

Forecasters predict strong sales of new light vehicles this year, possibly as high as 14 million units. But executives representing six major dealership groups -- five of them publicly held and one privately owned -- say they won't neglect their used-vehicle business, regardless of what happens with new cars and trucks.

"To be a good retailer you've got to be a good used-car merchandiser," says Mike Maroone, COO of AutoNation Inc., the nation's largest dealership group. "We've got a big appetite to continue to grow the used-car business."

The executives' commitment to used vehicles is understandable. After all, used vehicles were there when dealers needed them most

• Used cars and trucks kept dealerships afloat when new-vehicle sales tanked during the worst of the recession.
• Certified used vehicles filled gaps in new-car inventories last year when production cutbacks strangled the new-car supply after the earthquake in Japan.
• Old high-mileage used vehicles were a source of profits when dealers started selling the vehicles on their lots instead of at wholesale.

Having strong used-vehicle sales allows dealerships to offer more money on trade-ins, which boosts consumers' ability to purchase a new car and yields more used-vehicle inventory for their dealerships, the executives say. It's a virtuous circle.

"If new goes up and used goes down it's hard to get ahead in the business. You've really got to drive both segments," Maroone says.

'Success story'
Rob Kurnick, president of Penske Automotive Group Inc., the nation's second-largest dealership group, says the retail industry is large enough for his company to increase its new- and used- vehicle business simultaneously.

"Used (sales) has been a great success story for us over the course of the last year," Kurnick says. "We'll be able to continue with used cars as well as absorb new-car demand."

Steve Landers, partner at the privately held RLJ-McLarty-Landers Automotive, says his group opened three CarMax-like used-car stores -- one each in Little Rock, Ark., Shreveport, La., and Huntsville, Ala., -- over the last year or so. He said the group plans to break ground on a similar used-car store in northwest Arkansas within a month. The stores specialize in late-model used vehicles, he says.

"We're just being a good aggressive used-car dealer," Landers says.

But as retailers press for more used-vehicle sales, they concede that finding used vehicles, especially those suitable for certified used-vehicle programs, is more challenging now than it was a few years ago.

That's because of a shortage of off-lease vehicles, normally a major source of vehicles for certified used-vehicle programs. Industrywide off-lease volume fell 17 percent to almost 1.8 million in 2011, data from NADA Used Car Guide show. The guide company predicts that off-lease volume this year will plunge another 22 percent. Off-lease volume has dropped as a direct result of large banks and finance companies abandoning leasing in 2008-09.

Realistic challenge
Lithia Motors Inc., has set a long-term goal of selling 1.5 used vehicles for every new vehicle it sells, up from the almost 1-to-1 ratio it sells now, says CEO Sid DeBoer. Finding enough vehicles to reach that goal is a challenge, but possible, he says.

"It's having a qualified used-car person that knows the market and can find the cars," says the top executive at the nation's ninth-largest dealership group. "It's mining every other dealer in the areas we do business in; it's being at the auctions; it's working with manufacturers on lease returns and finance companies on repossessions.

"It's buying cars directly from the consumer -- that's a bigger piece of how we're finding cars. It's all of the pieces. It won't be a shortage of used cars that keeps us from our goal."

Michael Kearney, COO of Asbury Automotive Group Inc., says his company plans to continue its Asbury 121 (pronounced "1-to-1") program that it started in January 2010. Its goal is to sell an equal number of used and new vehicles.

The program emphasizes selling older, high-mileage vehicles taken as trade-ins. At the end of the third quarter of 2011, Asbury's used-vehicle sales equaled 82 percent of its new-vehicle sales, Kearney says.

"We have a used-car team that is fully dedicated to acquiring inventory and training the store to do trade walks to make sure we don't lose any trades," he says.

Pete DeLongchamps, vice president of manufacturer relations and public affairs of Group 1 Automotive Inc., says the company will certify any used vehicle that meets certification standards and will sell any older, used vehicle if its quality meets Group 1 standards.

He adds: "We'll never slow down our emphasis on used cars."

(Source: Automotive News, 01/30/12)

Consumers See Less Difference Between Car Brands, Survey Finds

A survey by the Consumer Reports National Research Center revealed that the difference perceived by American consumers between the top car brands and the challengers is shrinking.

The 2012 Car-Brand Perception Survey indicated that Toyota, Ford, Honda, and Chevrolet maintained their top positions but have seen the point gap decrease. Additionally, most of the top brands saw double-digit drops in their total scores.

"Dramatic events in the automotive industry seem to be affecting how consumers view auto brands. Erratic gasoline prices and a struggling economy have pushed consumers to prize low operating costs and good reliability," said Jeff Bartlett, Consumer Reports deputy editor for autos online.

The survey's scores reflect how consumers perceive each brand in seven categories: safety, quality, value, performance, environmentally friendly/green, design/style and technology/innovation. Combining those factors yields results in the total brand-perception score. While the scores reflect a brand's image in consumers' minds, they do not reflect the actual qualities of any brand's vehicles or results from Consumer Reports testing, according to the company.

Toyota continues to dominate overall in brand perception despite slipping by 17 points compared to last year's results. Other top brands, Ford, Honda, and BMW, saw their scores drop more than 20 points. The two leading General Motors brands, Cadillac and Chevrolet, did relatively better with only single-digit decreases.

Respondents indicated the most important factor in car buying continues to be safety (65 percent). The leading brands in overall perception in the survey usually excel in multiple categories. Volvo, however, has maintained a top 10 spot for years by virtue of its safety reputation alone, according to Consumer Reports. This year, however, Volvo experienced a 21 percentage point drop in this factor from last year's 70, to 49 percent. If it continues, this trend could drop Volvo out of the overall top 10 in future years and into the second tier.

Consumer Reports' survey found scores edging downward in the quality factor, with Toyota, Honda and Ford sharing a three-way tie for the top spot and the top brands.

"Brand perception can be influenced by many things, from professional road tests to marketing. Word-of-mouth from friends and neighbors can be a slower moving, though influential contributor as ownership transitions from the initial honeymoon phase to the seven-year itch," Bartlett said.

In the performance category, BMW's score dropped significantly from last year's 27 percent to only 19 percent, according to the survey. This drop leaves the German automaker vulnerable to Ford and Chevrolet.

Toyota again led the environmentally friendly/green category, likely driven by the Prius and other hybrids, as well as some creative marketing, according to Consumer Reports. Smart made a surprise showing this year, debuting in the top five despite having no new products or a sizable advertising budget. Honda again claimed the third position while Ford slipped slightly this year despite introducing the new Fiesta and Focus small cars.

After a year of seemingly endless headlines espousing the electrifying virtues of the Chevrolet Volt and Nissan Leaf, those brands didn't spring ahead in this factor. Chevrolet remained consistent with 12 percentage points while Nissan inched up about two percentage points, rounding to eight percent.

The Consumer Reports National Research Center conducted a random, nationwide telephone survey of 2,045 adults from Dec. 1-5, 2011, and collected survey data from 1,702 adults in households that had at least one car.

(Source: F&I Magazine, 01/26/12)

Why mobile TV is the linchpin for advertising success

For broadcasters and networks, mobile is becoming a necessary part of their distribution channels to meet the needs of consumers who want television content to be available on multiple platforms. Here lies the opportunity for brand advertisers.

With the increase in networks and broadcasters looking to mobile to give users additional bits of content and live streaming, marketers also have an opportunity to target mobile campaigns in new, non-traditional ways. The new slew of mobile initiatives also has implications for cable providers looking to lock consumers into TV services across multiple screens.

“Mobile will extend the reach of a TV campaign to places and times where users would not otherwise have access to watch it,” said Steve Lanzano, president/CEO of the Television Bureau of Advertising, New York.

“The bottom line is that mobile is additive to TV and is not cannibalizing the regular TV process,” he said.

Mobile views

Mobile TV is on the fast track with consumers, but one of the biggest hurdles for networks and marketers is being able to measure the mobile audience.

Although the opportunities to expand across multiple screens are available, without a solid way to measure the results of campaigns, companies are hesitant to tap into mobile initiatives.

However, consumers are willing to watch mobile content on their devices, according to research from TVB.
In a recent study from TVB, consumers were shown 30 – 60 second ad campaigns on a mobile device to gauge their thoughts on mobile TV.

Consumers who watched the 30-second clips were most receptive to the ads because they were short and users were able to recall the advertisement.

Additionally, 70 percent of the consumers surveyed watched the mobile video while out of the home, showing the opportunity that broadcasters and marketers have to give mobile TV to on-the-go users.

Ninety percent of the study’s respondents said they would be willing to watch mobile content if they were able to get it for free, showing how monetization will continue to be an issue for mobile TV in the future.

For in-home use, apps will continue to be important for service providers to offer consumers as an additional viewing opportunity while in the home, per Mr. Lanzano.

Companies such as Time Warner Cable and Cablevision have made mobile a priority by rolling out mobile apps, Web sites and other mobile offerings. Broadcasters are also developing apps for both tablets and smartphones that users can watch content on as long as they already use the company’s services.

Full-length streaming
When it comes to content, consumers are increasingly wanting to watch full-length TV shows on their devices and streaming will be a trend to watch in 2012 across both tablets and smartphones, per a mobile video executive.

“There are two main trends out right now surrounding mobile video – one is the idea behind TV Everywhere and getting a library of TV content to users across multiple screens,” said Harry Kargman, CEO of Kargo, New York.

“The other is watching something on a primary TV with an additional experience on mobile,” he said.
Second screen experiences can be a way for marketers to buy inventory with an audience that would not otherwise be available.

For example, Subway recently sponsored the PrePlay app to target Super Bowl fans (see story).

By sponsoring the app, Subway is able to get its brand at the center of consumer’s attention without being directly affiliated with the NFL or Super Bowl.

Although mobile TV monopolies are not ending, being able to get advertising messages to consumers in new places that are not associated with broadcasters is revealing flaws in the foundations that cable networks and broadcasters have established, per Mr. Kargman.

“The question is how innovative and outside of the box marketers can think to make sure that they do not lose out on these new opportunities,” Mr. Kargman said.

Live coverageAccording to research firm Strategy Analytics, 15 million users will access mobile TV in 2012, up from 12 million in 2011. The company also predicts that consumers will spend a total of $500 million on mobile TV services.

In particular, the rise in 3G networks has helped mobile streaming grow, especially with live coverage including breaking news and sports content.

“Clearly advertisers need to think about reaching target audiences across multiple device types as user behavior fragments,” said Nitesh Patel, London-based senior analyst for wireless media strategies, Strategy Analytics.

“Consequently advertisers will demand that TV companies are able to sell spots to reach their target audience across multiple device types,” he said.

Being able to buy across multiple screens will eventually become expected for TV marketers in order to reach the biggest group of viewers.

However, with the explosion of app markets, it has become difficult for operators to get control over their content and it will be a challenge in 2012.

“There will always be a need for wide area network coverage for accessing live events while away from a hotspot,” Mr. Patel said.

However, operators need to be strict over what traffic they can allow over their networks, even as they migrate to LTE so that will serve to limit mobile streaming,” he said.

Lauren Johnson - Mobile Marketing

Banks Still Have Their Devoted Fans

Contrary to the widely held belief that banks have hit an all-time low in their approval ratings, more than half of consumers surveyed by TD Bank say they are committed to their bank.

Furthermore, nearly two-thirds feel valued by them, according to the survey. Of those polled, 57% attribute helpful staff and personal service to feeling valued. Moreover, the majority of consumers cite positive customer service experiences as a principal reason for their commitment.

When examining what is most important to consumers when it comes to choosing a checking account, the number one answer (about one-third of respondents) cited is no monthly fees. In addition, more than 40% of those polled say their bank demonstrates a commitment to them through no or low minimum balance requirements.

Other key findings include:

• 48% of consumers surveyed say bank products and services are more valuable than telecommunications (i.e., mobile phone, Internet, etc.). Although the majority of respondents stated that having no monthly checking, debit or transactions fees associated with accounts are the most important things to them, less than half said they would actually take the step to close an account associated with the same fees.
• The top ways that consumers say their bank shows its commitment: No monthly checking fees (or waived fees) (65%), easy online banking (65%), good customer service (64%), no statement fees (57%) and convenient bank locations (53%).

The study was conducted among a nationally representative group of consumers who have a checking account/debit card from Jan. 12 to 16. The sample size of 1,010 has a margin of error of +/- 3.1%. The survey was hosted by global research company Angus Reid Public Opinion.

(Source: Marketing Daily, 01/27/12)

J.D. Power: What Drives Auto Avoidance

Consumer avoidance is as important to automobile manufacturers and marketers as loyalty. If you can figure out why people are running away, you can figure out how to get them back, right? Yes -- especially if avoidance is being fueled by left-brain parameters like experience of ownership, reviews, ratings, features, price and the like.

Unfortunately, it seems a lot of people are running away for a reason that, because it is so insidious, strikes terror in the hearts of auto marketers everywhere: consumer perception based on "conventional wisdom" about vehicle quality and durability.

More than 40% of new-vehicle buyers who avoided a particular model due to quality or reliability concerns say they based their opinions on common knowledge rather than personal experience, reviews, ratings or recommendations, according to the J.D. Power and Associates 2012 Avoider Study. The study is based on responses from approximately 24,045 owners who registered a new vehicle in May last year.

Among buyers who avoid a particular model because of perceived quality and reliability, 43% say their avoidance was because "the brand's vehicles, in general, are known to have poor quality/reliability." Thirty-eight percent based their avoidance on ratings and reviews, while only 14% said they based their decision on prior ownership of the model.

Jon Osborn, research director at J.D. Power and Associates, argues that if you are an automaker who had a quality problem in the past (that created a generation of naysayers), you can't just let your cars do the talking now.

"For some brands, namely those that have created marked improvements in their quality and reliability in recent years, it's even more vital to tell their improvement story, rather than just waiting for perceptions to change over time," he said, in a statement.

In good news for domestics, the percentage of buyers who avoided import models because of their origin has increased to 14% -- the highest level since the inception of the study in 2003 -- while the percentage of buyers who avoided domestic models due to their origin has declined to 6%, a historical low.

"The decline in avoidance of U.S. models due to their origin reflects a buy-American sentiment that surfaced as the economic recession led to domestic job losses and adversely affected major U.S. institutions such as the Detroit Big Three," said Osborn. "In addition, the quality, dependability and appeal of domestic models have improved during the past several years, as well, and this may also be a cause for declining avoidance."

While perception about quality and reliability is driving avoidance, it is no longer the main driver of purchase. Gas mileage has leapfrogged reliability, the deal and exterior styling, which were the most influential purchase reasons in 2010, the 12-month period covered by the firm's last Avoider study.

While gas mileage and environmental impact certainly are the big drivers for Chevrolet Volt, Nissan Leaf and Toyota Prius, consideration is not uniform across the nameplates. Image is a prominent reason for purchase of Volt, while buyers cite low maintenance costs for the Leaf and reliability for the Prius, per J.D. Power.

Among buyers who avoided the Volt, purchase price was the most-cited reason, while the most prominent avoidance reason for the Leaf and Prius is exterior styling. For the Volt and Leaf, a notable proportion of buyers cited the models' small size as an avoidance reason. For the Prius, performance is a prominent reason for avoidance.

(Source: Marketing Daily, 01/27/12)

Always Shoot for the Next Level

The most successful salespeople stay that way by maintaining an edge on the competition.

The majority of them read industry literature, join trade organizations, and regularly attend conferences and seminars to keep up to date on what's changing in their industry, and what new and emerging trends they need to be aware of.

In that spirit, a lot of top salespeople are continually looking for new ways to move upward in their own organization, whether that means attaining a new benchmark, earning a new title, or striving to achieve some type of incentive.

They always have something that propels them forward, keeping them in a state of perpetual motion.

Ubiquity of Mobile Platforms Threatens Pay TV Subscriptions

According to Deloitte's sixth edition "State of the Media Democracy" survey, access to content is increasing American media consumption.

Movies are available on a wider array of platforms: home TV via cable, satellite, DVD, pay-per-view, Internet and online via streaming/downloading to a personal computer, gaming console, smartphone or tablet. As recently as 2009, only 28% of Americans reported streaming a movie; today, 42% report streaming.

In 2007, 37% of people said that they had not viewed a movie, available for purchase or rental, during the past six months. In 2011, that percentage of non-consumers dropped to only 19%. And, while only 23% of respondents preferred to be able to download their books, magazines and newspapers to a digital device in 2007, 36% now express interest in this option.

The survey found that 20% of leading Millennials (ages 23 to 28) have read their favorite newspaper in the last six months on a smartphone, up from 9% last year. 11% of leading millennials have also stated that this is their favorite method for reading the newspaper, up from 3% last year.

Phil Asmundson, vice chairman and U.S. media & telecommunications sector leader, Deloitte LLP, notes, "Consumers may be watching fewer cable shows and movies on TV, or reading fewer physical copies of books and newspapers, but they have not stopped consuming the content. They are simply watching or reading on different media or platforms."

As adoption of smartphones grows, Americans are beginning to use them as "all in one" devices for a number of different tasks. In 2011 the survey found increases in Americans using:

• Text messaging (up to 78% in 2011 from 71% in 2009)
• Mobile online search (46% in 2011 compared to 30% in 2009
• GPS for directions (37% in 2011 versus 22% in 2009)
• Online banking, tracked for the first time in 2011 (19%)

"As the costs for these types of devices, apps, and the wireless services that come with them continue to fall, consumers are starting to shift their behavior, taking advantage of connectivity, performance, and portability that rivals and often beats that of a laptop," said Asmundson.

Though using a DVR is the second-most preferred means of watching one's favorite TV show, says the report, Americans have already cut, or are exploring cutting their pay TV connection entirely.

The survey found that 9% of people have already cut the cord and 11% are considering doing so because they can watch almost all of their favorite shows online. An additional 15% of respondents said that they will most likely watch movies, television programs, and videos from online digital sources (via download or streamed over the Internet) in the near future.

But, concludes Asmundson, "In a world where consumers have other ways to access content...the DVR may (still) be an underutilized service...(since) the majority of Americans don't have a DVR in the home...could serve as a value-add for cable and satellite TV companies..."

(Source: The Center For Media Research, 01/19/12)

5 To-Do's When Activating Digital Shopper Marketing Programs

Digital shopper marketing tools are clearly enhancing the consumer shopper experience, both for the marketer as well as the shopper. However, the dizzying array of tools available can make it a bit challenging to discern which ones will provide the most bang for the buck for marketers.

A new survey on digital shopper marketing from Catapult helped provide the following five considerations when activating these programs:

1. Leverage the Proven Winners

To date, only three tools have captured shopper hearts and minds: Self checkout, printed coupons from the Internet, and online circulars, all of which are previously-existing tactics translated digitally. These tools are easy for shoppers to understand and easy to use and should be integrated where possible.

Brand Examples: Kellogg's, P&G and General Mills all have robust programs on Coupons.com and MyWebGrocer. Publix's circular integrates lifestyle images and recipes on the cover rather that just product shots with price.

2. Beware of the Bright and Shiny

Know the facts and understand where fatigue has set in. Tools such as Foursquare, QR codes, and social media are not shopper motivators, while other media darlings such as Shopkick and Checkpoints have very low shopper penetration. Evaluate the facts, and ensure you've selected tactics that deliver against your higher-level objectives.

Brand Examples: QR Codes on Heinz Ketchup bottles in restaurants and Walgreens Foursquare program.

3. Understand the Balance of PR Drivers vs. Those With Utility

The way many digital shopper-marketing tools have been leveraged to date -- such as augmented reality and location-based check-ins -- have provided good public relations opportunities for brands, but lack a real use for the shopper. Be sure you are clear with your objectives, and rethink how you leverage moving forward.

Good PR Drivers: Foursquare
Good Utility: Grocery IQ

4. Early-on vs. add-on

Deliver Integrated digital shopper solutions vs. tactical add-ons, and understand how to re-leverage national/brand assets and activity across the path-to-purchase at retail.

Brand Example: Pets Lovers Love Walmart -- a category program that extends Pedigree's National Pet Adoption program into a retail-specific environment.

5. Leverage the Full Spectrum of Shopper "Need States"

Digital shopper marketing tools do more than just "save me time" and "save me money." The tools "make me feel smarter," "make Shopping Fun," and "support my values," among other benefits. Determine where and how digital can best deliver against these need states, and leverage the tools whose need states align with brand, product and target needs as well as program objectives.

Brand Example: Kellogg's Share Your Breakfast Program -- "Supports My Values"

(Source: Promo Magazine, 01/10/12, by Brian Cohen, Director of Digital Shopper Marketing, Catapult)

Toyota, Honda begin to rebuild

The big sales winners of 2011 will try to hold off a resurgent Japanese giants

An early trend: Last year's three big sales winners -- Chrysler Group, Hyundai-Kia and Volkswagen of America -- continued to drive the market in January.

An early subplot: American Honda and Toyota Motor Sales U.S.A. have begun their long-awaited sales recoveries after a tough 2011. How much lost market share will they win back, and where will it come from?

A surprisingly strong January -- up 11 percent from January 2011 and the best January since 2008 -- seemed to preview that battle, in an optimistic setting. The 913,284 light-vehicle sales translated to a seasonally adjusted rate of 14.2 million, matching the cash-for-clunkers frenzy of August 2009 and well above December's 13.6 million pace.

The January SAAR "is 1 million over the early-month expectations," said Adam Jonas, top auto analyst at Morgan Stanley. "Our 14 million sales forecast is officially under review for positive revision."

"It's significant to see 900,000 in January when much of the country typically is in a deep freeze," said Toyota Division General Manager Bob Carter. "We're bullish with where the industry is going."

Chrysler Group sales surged 44 percent, VW group was up 40 percent and Hyundai-Kia rose 20 percent. And all three were going up against strong January 2011 figures.

But after losing volume last year because of product shortages caused by natural disasters, Toyota group sales rose 8 percent in January, and American Honda climbed 9 percent. And those comparisons were against a relatively normal January 2011, before the Japan earthquake.

Before January, American Honda's sales declined in every month since May. Toyota sales were down or flat in seven of the previous eight months.

Inventory levels still aren't back to normal for either company. But Toyota Motor Sales' market share in January was 0.7 points higher than the 12.9 percent share it achieved for the 2011 calendar year. American Honda was up 0.1 point from its 9.0 percent in 2011.

In 2011, the two Japanese groups lost a combined 3.9 share points. Meanwhile, Chrysler picked up 1.3 points, Hyundai-Kia added 1.1, General Motors gained 0.5 and VW picked up 0.4.

The coming battle

Analysts expect the battle to be in full force by the end of March, when Toyota and Honda expect full inventories.

Still, TrueCar.com analyst Jesse Toprak predicts Toyota and Honda won't regain more than half of the share they lost last year.

"The competition is so much better and customer loyalty is not what it used to be," he said. "The danger is that consumers have found out there are other good cars out there."

Toprak expects most of the share the two Japanese automakers regain to come half from Hyundai-Kia and half from the Detroit 3.

Analyst George Magliano of IHS Automotive expects Toyota and Honda to regain only about a fifth of their lost share during 2012 -- and he says it will come entirely from GM and Chrysler. He sees Hyundai-Kia continuing to grow.

"Toyota is still feeling the effects of the recall and, along with Honda, is hurt by the strong yen," he said.

"GM still has issues on the product side as the Silverado ages. Chrysler has some upside potential, especially later in the year if the Dodge Dart takes off from the start."

Last month Nissan North America sales increased 10 percent, while Ford Motor Co. volume gained 7 percent, both just below the industry average of 11 percent.

The only major player to lose volume in January was GM, down 6 percent. But GM's decline is distorted because it's coming off an incentive-driven surge in January 2010.

The company's January market share fell 3.4 points from a year earlier but was only 1.2 points lower than its full 2011 average.

GM U.S. sales boss Don Johnson expects a gradual improvement in consumer sentiment.

"We're seeing a continuation of the kind of growth and sentiment that we saw start to pick up in the fourth quarter," he said.

Caught by surprise

Jonas of Morgan Stanley wasn't the only analyst to be caught by surprise by the January surge.

TrueCar.com, Wells Fargo Securities and Kelley Blue Book also are rethinking 2012 sales forecasts as a result.

Kelley Blue Book analyst Alec Gutierrez did not officially revise his 13.3 million sales forecast for the full year. But he said "sales are on pace to surpass" that level.

In December, Jonas was the highest and Gutierrez toward the low end of 11 analysts Automotive News asked to forecast 2012 U.S. auto sales. The forecasts ranged from 13 million to 14 million and averaged 13.6 million, which would be up 6 percent from 2011's 12.8 million sales.

Jonas and Gutierrez cited as a positive factor a large number of new and redesigned vehicles hitting the market this year, starting in the second quarter.

For example, Carter said Toyota will launch 19 new or updated models this year as it tries to regain lost market share.

"About 40 percent of the vehicles we sell this year will be new or significantly updated models, compared to just 7 percent last year," he said.

Consumers are becoming more interested in new vehicles and advanced technology and less concerned about the economy, Toprak said.

"It's starting to feel like the good old days, when people got worked up about new products," he said.

Several executives and analysts cautioned that January is often a volatile month, but optimism about 2012 is growing because of the month's strong sales.

"It's too soon to declare victory," Toprak said. "But there's a very good chance we can get to that magic 14 million level this year if this pace continues."

Shifting shares
For the first time in months, market share for Toyota Motor Sales and American Honda moved upward in January.
	Jan. 2012	Jan-Dec.2011
General Motors	18.40%	19.60%
Ford Motor	14.9	16.8
Toyota Motor Sales	13.6	12.9
Chrysler Group	11.1	10.7
American Honda	9.1	9
Nissan North America	8.7	8.2
Hyundai-Kia Automotive	8.6	8.9
Volkswagen of America	4	3.5
Source: Automotive News Data Center, automakers

Jesse Snyder - Automotive News