LEXUS! BMW! MERCEDES! … Hyundai?

The Hyundai Equus is a new vehicle released just recently from the Hyundai Motor Company. That doesn’t sound too out of the ordinary, but what if I told you that it was a luxury car? In fact, what if I told you that the price tag on it could be as high as $67,000?

Wait, you mean you didn’t expect such a high value from a Hyundai?

You aren’t alone. The interesting move has a few people scratching their heads and wondering how much potential the Equus can be. I’ll be bold enough to publish my prediction on the world wide web right now: I disagree with Hyundai’s strategy, and I don’t think this car has a very bright future.

First, let me start by telling you about the car, because I don’t want anyone to think that I’m under the impression that it’s not a nice product. It has heated, messaging, and ventilated seats; it has an 8-inch display screen; it has front and rear cameras; it has a push-button start; and it has power sun-shades on the windows.

But here’s the thing: It’s still a Hyundai.

I’m going to propose that there are two factors in any decision that any of us make.

  1. Emotion
  2. Logic

Neither of the two factors have the ability to completely sway one to make a certain decision, but rather they compose a bi-polar construct, and each decision is made based on a degree of both. You can try to tell me that you are able to step away from the situation and look at the decision in question completely rationally and objectively, but it simply isn’t true, and I am willing to bet that I could prove you wrong if I followed you around for a day or two.

Personally, I have a thing for Starbucks, Magic Hat, and Sperrys. Do I like their products? Yes, but are they that much different from their competitors that I have justification for my high degree of loyalty to them? I certainly don’t think so.

What I’m talking about here is Consumerism. In America, especially, we don’t buy things for their utility, we buy them for status. To quote one of my favorite rappers,

Conspicuous Consumption: that means it serves no other function than to show off to someone, or others who are only trying to show off to you – look at your fellow loyal customers. – Lupe Fiasco (WWJD He’d Prolly LOL like WTF!!!)

Let’s be completely honest with ourselves. Hyundai, though not a bad company, has always been cheap. For whatever reasons, the image that Americans have of Hyundai is that it’s a decent option for an entry-level car if you don’t have loads of income to get something nicer with.

Don Draper of Mad Men frequently says,

If you don’t like what they’re saying about you… change the conversation.

The fact of the matter, though, is that that is very much easier said than done.

Anyone that can afford a $65,000 car is probably used to having really nice things, and showing those things off to others. Can any of us really imagine a wealthy business executive walking into the clubhouse of the private country club that he belongs to and telling his friends (also all wealthy businessmen)  at the bar that he just bought a Hyundai?

It doesn’t matter how nice the car looks, or how great the warranty on it is, or how many features it has, or how safe it is. Hyundai means something in the minds of all of us, just as every brand has an associated meaning attached to it, and it seems daunting to me to try to fight against that stigma.

If Hyundai thinks that the luxury vehicle market is one that they can make a profit in, why don’t they just start a new brand? Forming a new image is much easier than transforming an old, competing one. Has anyone ever bought a luxury Toyota? No, they buy luxury Lexus, which is owned by Toyota.

A car is not just a way to get from point A to point B. It’s also a status symbol, a source of happiness, and a way to communicate to others. An Equus and an Accent, therefore, are completely different products, and should be sold as such.

Am I wrong? Would you spend 65K just to tell people that you drive a Hyundai?

 

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About Jim Mignano

Jim Mignano is a young professional practicing and learning Public Relations in Rochester, NY. He is passionate about the possibilities that digital media provide and loves utilizing new platforms for a variety of functions. James' blog is about people and the technology they use. It's about communication and persuasion... the old and the new ways of doing things... the struggle between sticking to the tried, true recipes and experimenting with intuitive, innovative ideas. It's an extension and reflection of James himself: the convergence of ambition & ability.
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3 Responses to LEXUS! BMW! MERCEDES! … Hyundai?

  1. In the end, I think the power of a brand sways the decision for a purchase more than people want to admit. I do not believe anyone would purchase this Hyundai feature full car at $65,000 when the basic model 2012 Mercedes Benz SLK Roadster is at $55,000. MB is so powerful that having that in the garage will make people sleep better than knowing there’s a “luxury” Hyundai there. Your statement is absolutely correct and is what people will be saying to themselves: “Its still (JUST) a Hyundai.”

    Great post!

    BoostAndBoobs.com

  2. Mark Trova says:

    Jim,
    Great post. I cannot agree with you more. The power of brand names is so underestimated when it comes to buying luxury items — think about it, if a Timex can tell time as good as a Rolex, why would any wealthy person buy a Rolex, aside from the power of brand name?
    You mentioned the two factors in purchasing, logic and emotion, and quite frankly, if we’re talking about the supremely wealthy, emotion outweighs logic every time. Logic is actually foregone almost completely! Which is why you are right about Hyundai, even if Hyundai has a more reliable, safer and better-looking product in the $67,000 car market, no rich person in their right mind would drive it. Then, assuming that “typical” Hyundai customers simply can’t afford it, who are they marketing this too??
    When you told me they were making this car I almost laughed. If this car lasts 2 years on the market, I will be surprised.

    Mark

  3. Joe Mignano says:

    Jamie,

    I agree this car seems a bit over priced when considering the competition. That being said, I don’t think it is a bad idea for Hyundai to break into the luxury market because of the image already associated with that brand (perhaps I’m old but….I don’t think of Hyundai as a terrible brand…don’t they have a 100,000 mile warranty? How poor quality could their cars be?).

    Unlike the Starbucks move into alcohol, this really has almost no risk of alienating existing customers. I think the average consumer expects car companies to sell different models at different price points. Assuming the company hasn’t mass produced an entire fleet of these cars, it seems unlikely to me they would actually all go unsold (especially considering that the higher price point gives them more room to discount).

    Where I do agree with you is in bringing this product to market under a different brand name. There is a certain point where a company needs to admit they can’t be everything to everyone, and while I don’t think this is a huge issue in this case, I wouldn’t be against a Hyundai luxury brand.

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