The automaker Saab is in desperate straits after having brought to the brink of oblivian by the misguided actions of its parent General Motors over the past fifteen years (G.M. bought half of Saab in 1990 and took the other half in 2000).
The depth of Saab’s plight has been underscored by analyst calls for General Motors to shut Saab down (and it really is charming that analysts who seem not to have a bone business sense in their bodies and no formal marketing training get to exert real influence on brand decisions based on the ‘middle-line’ cost implications alone). In addition, Kirk Kerkorian who now owns almost 10% of General Motors is trying to place Jerry York on the board. York has said publicly that General Motors should focus on fixing the core asset and counts Saab as one of the ‘nits and nats’ that need to be eliminated.
And sadly, this seems very likely to be the case. Personal disclosure – I have a fond history with Saab having helped my sister purchase a Saab in 1988 and then buying a (less great) one myself in 1995. Even in the span of those years – between the ’87 and ’95 models, it was clear that GM was having a bad influence on Saab and it was hurting the brand. Now the torturers may actually succeed in killing it.
Saab has an usual heritage for an auto maker. Svenska Aeroplan Aktiebolaget was founded in Trollhatten, Sweden in 1937 by a sixteen aviation engineers looking to produce high performance fighter aircraft. Only one of these engineers had a driver’s license. Only after the end of World War II did the company turn to producing automobiles as a source of growth. Yet through the years, Saab remained an aircraft company producing cars in spirit rather than just a car company. The Saabs introduced in 1947 and 1949 had drag coefficients similar to modern sports cars. At the time, nobody in automobile manufacturing was thinking about drag and windflow affecting either performance or economy. Saab was also the first automobile maker to introduce turbocharging as a fuel and space-efficient option for higher performance and side impact protection for safety.
And most of all (from the perspective of an advertising blog ) , Saab was a great brand. Not a great brand because it had huge market share, but because it was unique and commanded unbelievable loyalty among it’s followers. In the seventies and eighties, Saab drivers were the adventurous, slightly eccentric folks that thought Saabs just made more sense even if they worked differently than other cars. Lots of things worked differently. The key went into a slot at thigh-level between the two seats which we were told prevented injuries during a crash. The stick-shifter had to be placed in reverse to start manual transmission Saabs which several times stranded friends and relatives borrowing the car to run for coffee or to the grocery store. The heating system seemed to work ten times better than the A/C, which was not surprising for a Swedish car.
The most important thing about the Saab from a branding standpoint is that it embodied the three characteristics of great brands – it was authentic, it was unique and it was consistent. In this world of the Gap, Starbuck’s and McDonald’s the value of brands that are different from the mainstream cannot be overstated. Saab had that. The cars looked unique. They were the only sport sedans that were hatchbacks – bucking the trend of U.S. buyers to think of hatchbacks as economy cars. And Saab’s loyal buyers loved that – loved that the cars looked a little goofy that they worked differently, felt different, drove different.
That made for a pretty good little car company. And an attractive one for General Motors to suck up. When this happened, even in the begining when GM only owned 50%, things began to change immediately. And not for the better.
I’m working on a book on branding right now and trying to distinguish some of the lesser known characteristics of successful brands. One of them is fanatic attention to detail. Great brands have in intuitive ability to get the small things right. Consumers draw cues from the small things and can sense false notes incredibly well. Almost from the beginning of the GM/Saab merger, GM started sending false notes through the Saab brand.
The first signs were very small indeed and they were exactly the sort of thing that Wall Street analysts would applaud. Instead of producing extra parts for Saabs outside of some of the really big items, they started drawing from the GM parts bin. So on my 1995 Saab, the turn signal indicator and numerous other small parts looked suspiciously like what you might find in an Oldsmobile. Not that the ‘big picture’ look of the car had changed. It still had the familiar front fascia (although the edges had softened a bit and not for the better), still had the key in the center location and still had a hatchback. But there were small signs that it was somehow less of a Saab.
As time went on, Saab fell victim to the ‘lowest common denominator’ marketing approach that hurt so many GM brands. The hatcback was dropped in favor of a trunk because market research showed that more consumers would consider buying the Saab if it had a trunk. More small parts and even chassis and platforms merged.
In the process, GM made another vital mistake. They forgot to let Saab be Saab. They forgot to let the Swedish airplane engineers innovate in a unique way. To be clear, Saab did continue to innovate under General Motors. For one thing, they created a unique whiplash prevention system which helps save your neck (literally) in a rear collision by moving the headrest forward. But the innovation was clearly guided by corporate priorities and marketing research. There was no sense that these quirkly engineers got together and decided “this makes sense and will make the car better and even though it is the opposite of what every other car does our drivers will appreciate it.” Even the innovations felt more mainstream.
Now General Motors, having mortally wounded Saab may kill it. Which is ironic, considering that General Motors really ought to be killing their undifferentiated clone-brand cars like most Chevy’s and Buicks. It seems very obvious from the outside that General Motors real problem is that half of their products look like they were designed by a committee, that in the quest to make every product good and popular they prevent themselves from making anything truly great.
Instead of listening to the analysts, General Motors ought to think about a little less centralization in the land of Oz. Imagine a General Motors structured a little less like the U.S. Army and a little more like Johnson & Johnson (or like Saturn was, originally). Independent car companies are given great autonomy in car design and production. Some production facilities, parts etc. are shared but those are not visible to the consumer. The corporate functions as an banker and shareholder to the operating companies (saying yes I will support this project or that depending on your success and plans for using my money). Brands are measured not just on short-term profitability but on measure of customer loyalty and in intensity of interest in new products. Success would ultimately be measured not by the size of the brand but by the percentage premium its products are able to sustain over competing car models. And a GM employee would say “I work for Cadillac” or “I work for Hummer” but never “I work for General Motors.”
In the meantime those of us who loved but ultimately left the Saab franchise will get ready to say a fond fairwell to an original and authentic brand. And hope that someone has the sense to someday make the brand what it once was and could again be.