Somehow, the news didn’t surprise me all that much.
At the same time that police released the 911 call of a panic-stricken guy careening down the highway because the gas pedal on yet one more Prius got stuck, Toyota announced that for the first eight days in March, sales were up over 50% from the same period the year before. This, after months of one embarrassing recall after another, the US congress calling Toyota’s chairman to testify, and rumors of a potential cover-up gaining momentum. And of course, there’s been no shortage of people on Twitter who’ve mockingly noticed that the company that can’t seem to get their cars to stop accelerating uses the tagline “Moving Forward.”
So how is it possible that Toyota is actually seeing an increase in sales? Okay, we can write off a portion of the increase to very favorable sales and payment terms. Everybody, especially in a recession, likes a sale, and Toyota is offering some pretty good ones right about now. But that alone doesn’t explain away their continued success.
Neither does the adage “there’s no such thing as bad PR.” The concept here is that no matter how negative the coverage, PR keeps a brand name in front of consumers, generating recall and awareness. If we’re to accept this at face value, then people’s ability to recall a brand name is stronger than their ability to recall any negative associations to it. In some cases, that’s true. Look at what’s become standard practice for Calvin Klein. Every couple of years, the brand puts up a billboard in Times Square showing an image that’s just over the border of conservatively offensive. Like clockwork, local church groups and mom’s groups get riled, send their letters to the media, and less than a day later CK receives millions of dollars worth of national (albeit negative) press for the cost of a local ad. They apologize, pull the ad down, and life goes on as usual while CK reaps the rewards. Negative PR helps the brand.
Milli Vanilli, however, had a different experience (ok, I’m reaching into the way-back bag, but it’s an appropriate example). After being exposed as lip-synching front men for more talented but less attractive singers, their careers were all but over. Negative PR was the end of them.
The difference between these two stories is who they’ve offended. Calvin Klein shows immunity to negative PR because the church groups and moms groups that they’ve upset aren’t among their core consumers. Their target market is less likely to pay attention to the outcries of conservative watchdogs, and less likely to find the ad offensive. In the end, the brand name becomes reinforced in their minds with no negative association. Milli Vanilli, on the other hand, offended their core market, lying to the people who bought their music and went to their shows. Negative PR in this case didn’t drive more people to their brand, it drove them to return the purchases consumers had already made and subsequently led them to turn their collective backs on the artists.
So where does Toyota fall in all of this? Well, the negative PR is relentless, but the real question is who are they offending? We can’t say it’s drivers in general – drivers who didn’t own Toyota’s before all of this happened feel disconnected to their problems; hey, it didn’t happen to my car. And Toyota owners whose vehicles aren’t part of the recall likely feel the same way; hey, it didn’t happen to my car. But the real reason why people still buy Toyota, and why they’ll continue to buy them in the future speaks directly to the power of the brand. For decades, Toyota has built trust equity among consumers – demonstrating their ability to produce high quality, cost efficient cars that people like to drive. In every way, shape and form, they have lived up to their brand promise, and ingrained themselves in the minds of the market as reliable. Would they have survived their current problems if they were a new company and large recalls occurred right out of the gate? Unlikely. But because they’ve established a firm brand over a long period of time, they’re more able to weather the storm.
The end result, then, is a unique blend of negative PR around a brand that is viewed favorably. The negative PR increases awareness. The trust equity built over time thwarts any negative messages in the media, and the net result is a veritable mountain of free, sustainable PR for the brand, combined with favorable pricing, ultimately increasing sales. The power of branding is not a vague concept, but a very key part of trust, loyalty and sales.
