Emission impossible: how automotive manufacturers can broaden the reach and resilience of their brands
This blog is the first in a series of publications focusing on CSR and the automotive industry which have been informed by discussions with representatives from across the industry and which draw on CAF’s own research and experiences of working with corporate clients to develop and implement all facets of their CSR strategies.
The blogs are written by James Edney, Senior Corporate Advisor at CAF.
Automotive sector: blog 1 of 3
The automotive industry has experienced a rough ride of late and the road ahead looks pretty bumpy too. A number of high profile emission scandals, child labour supply chain investigations, and inconsistencies between lab and real life performance have drawn negative attention. Manufacturers across the industry are also grappling with tech companies positioning themselves as the vanguard of the driverless car movement.
And that is very much the tip of the iceberg.
A broader and more resilient brand
In the face of these challenges, it is a concern that many manufacturers will focus on ensuring the quality of their finished product to overcome them – making them more efficient or more technologically sophisticated.
However, could automotive manufacturers’ efforts be better served working to broaden the reach and resilience of their brands, adopting a more balanced combination of ingredients within the foundations upon which their reputations are built?
This is important because technical standards will only become more stringent and customers more demanding, increasing the frequency with which products are tested. The emission scandals clearly highlighted the risk to reputation; and not only were reputations damaged, but the industry was subjected to greater scrutiny with the UK Government enquiry into emissions testing and significant worldwide negative media coverage.
That may already sound like a pretty compelling reason to broaden the reach and resilience of a brand, but taking a step back, what are the wider implications of those scandals beyond billion dollar fines and people thinking twice before making a particular purchase? Three things stand out:
- we have never had so much information at our fingertips, enabling us to readily form opinions and impressions on a wide range of issues;
- with each new generation we are becoming more socially aware and engaged, placing higher expectations on each other and businesses to act in environmentally and socially responsible ways, and;
- we are becoming more sophisticated consumers, considering more variables than ever before when determining our perspective on a brand
Ultimately, as an automotive manufacturer everything you do matters.
So we now expect more from manufacturers than just a quality product or the promotion of a lifestyle we aspire to attain. And of all the perspectives on a brand, it is the one of the consumer that is arguably the most important. As consumers we often adopt the brands we support as shortcuts to our own values, so each facet of a brand must speak to a consumer’s identity including their ethics and ideals. In a world where everything matters, a reputation is no longer owned by any one aspect of a business, no matter how successful its product.
How to build brand resilience and increase positive stakeholder relationships
So what steps can automotive manufacturers take to broaden the reach and resilience of their brands and respond to these developments?
Broadly speaking, automotive manufacturers should ensure they adopt a strategic approach to their corporate social responsibility (CSR) activities. Based on our experiences of working with corporate clients to develop and implement their CSR strategies this is often the doorway through which customers and other interested stakeholders engage with a brand beyond its products. More practically, that strategic approach could manifest itself in the efforts undertaken to build reputational equity in the local communities where manufacturing bases are situated, brands populate, and where consumers engage in dialogue. Whether to rebuild lost trust or to prepare for future challenges, manufacturers need to find more ways to meet with public approval.
This is not to say automotive manufacturers are not engaged in activities throughout local communities; millions of pounds and thousands of hours are already devoted to charitable and community causes.
But to what extent are those contributions responding to the very different way their brands are now being interpreted, interrogated, and as a result, rejected or appropriated by customers? What we have found in our conversations with clients is that this is often not about donating more money, resources, or time. It is about taking a considered look at the impact such actions are trying to achieve and having an open discussion about what role they want to play in society as a business, large employer and global brand.
What is increasingly clear to us is that without a strategic alignment between those activities and an ambition to broaden the reach and resilience of brands, opportunities will be missed and reputational equity lost at a time when automotive manufacturers need all the support they can get.
If you would like to discuss how the issues covered in this blog affect your business or if you are interested in receiving more information please contact either James Edney, Senior Corporate Advisor in CAF’s dedicated Corporate Advisory service at firstname.lastname@example.org, or Kuljit Karir, Corporate Client Manager at email@example.com.