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Hyundai Competitive Analysis

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Simone Thomas

on 4 August 2011

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Transcript of Hyundai Competitive Analysis

Goals Top Competitors Genesis Coupe Genesis Azera Sonata Hybrid Elantra Accent Veracruz Sonata Tucson Santa Fe Elantra Touring Equus Hyundai is Rapidly Gaining Market Share in the Automobile Market... Target Markets Stephanie, Chicago
38 Years Old
No Children
Bachelors Degree
Income Between $50,000-$100,000
32 Minute Commute to Work Erik, Salt Lake City
33 Years Old
1 Child
Some College, No Degree
Income Between $35,000-$75,000
23 Minute Commute to Work Lisa Dallas
35 Years Old
1 Child
Some College, No Degree
Income Between $50,000-$100,000
30 Minute Commute to Work What does Hyundai sell? Ok so, for everyone who can't afford a Bentley, who drives Hyundai? Stephanie drives an Accent, Sonata or Elantra Erik drives an Azera or Veracruz Lisa drives a Tucson or Genesis Spending Hyundai spent $172,892,985 on advertising across all mediums in the last 12 months.

In that 12 month period, the majority of that money went to Local TV advertising their top 3 nameplates: Sonata, Elantra and Genesis

Of their 5 top competitors, Ford spent the most on advertising in the last 12 months; $408,193,062 across all mediums, advertising on mostly Local TV for 4 prominent nameplates: Fusion, Focus, F-Series and Fiesta

Hyundai spends slightly more on advertising than Nissan who spent the least amount, $170,783,672 in the last 12 months advertising on mostly Network TV; Spending most on Altima, Maxima and Juke Top 6 DMAs (Highest Local TV Spend)
1. New York - $1,154,243
2. Chicago - $588,619
3. Philadelphia - $383,262
4. Cleveland - $332,170
5. Cincinnati - $188,560
6. Washington D.C. - $182,511 Accent BDI
(B Car) Elantra BDI
(C Car) Top 6 DMAs (Highest Local TV Spend)
1. New York - $7,032,894
2. Chicago - $2,710,703
3. Philadelphia - $2,493,948
4. Washington D.C. - $2,070,677
5. Boston - $1,356,655
6. Miami - $1,327,978 Sonata BDI
(CD Car) Top 6 DMAs (Highest Local TV Spend)
1. New York - $7,675,351
2. Chicago - $5,795,065
3. Philadelphia - $2,921,048
4. Washington D.C. - $3,244,834
5. Boston - $1,584,117
6. Miami - $1,447,583 Azera BDI
(D/E Car) Top 6 DMAs (Highest Local TV Spend)
1. Salt Lake City - $25,347
2. Phoenix - $15,439
3. Denver - $12,291
4. Honolulu - $1,073
5. Sacramento - $1,043
6. Portland - $901 Tucson BDI
(Small Utility) Top 6 DMAs (Highest Local TV Spend)
1. New York - $1,469,295
2. Philadelphia - $603,176
3. Chicago - $377,019
4. Dallas - $347,257
5. Houston - $325,309
6. Boston - $280,507 Veracruz BDI
(Large Utility) Top 6 DMAs (Highest Local TV Spend)
1. New York - $311,753
2. Boston - $98,623
3. Houston - $44,979
4. Hartford - $37,606
5. Pittsburgh - $28,242
6. Salt Lake City - $25,347 Genesis BDI
(Sports Car) Top 6 DMAs (Highest Local TV Spend)
1. Houston - $360,424
2. Dallas - $299,194
3. New York - $290,720
4. Orlando - $269,276
5. Baltimore - $256,980
6. Chicago - $204,984 How much does Hyundai spend to reach these people? Sponsorships NYC Veteran’s Day Parade of Pride - November 2009
Sun Bowl - December 2010
PGA Golf Tour: Tournament of Champions - January 2011
83rd Academy Awards – February 2011
New Zealand Pro Longboard Tour - March 2011
Coachella 2011 - April 2011
Youtube Symphony Orchestra – April 2011
Boston Marathon Jimmy Fund Walk - 2002 to Present
FIFA World Cup - 2002 to 2022 How else does Hyundai spend money? Donations Donated $65,000 to Habitat for Humanity of Orange County 07/2009
Donated 1,000 Winter Coats to Detroit via Focus: HOPE 01/2010
Donated $50,000 to Children’s Hospital of Michigan 01/2010 and here.... Grassroots In 1998, New England-area Hyundai dealers started a local initiative to raise money for the Jimmy Fund at the Dana Farber Cancer Institute in Boston

Hyundai Hope on Wheels is now a non-profit organization supported by all Hyundai dealers nationwide

Donated more than $23 million to children’s hospitals in the U.S.

Donations are made every time a new Hyundai is sold

After making a $10 million donation to Children’s Hospital in Orange County, the hospital named their cancer center the Hyundai Cancer Center Institute and here too... Social Media Facebook is used for promotions, news, video, photos and events
Customers talking to each other, no interaction from Hyundai
Nameplate Facebook pages for: Equus and Genesis

Twitter is for all vehicles
Used to tweet news and converse with followers not much about customer service

Youtube has video about most popular vehicles, commercials, auto show, Uncensored campaign and owner video Facebook
Likes: 173,291
All vehicles
2 nameplate pages
Promotions Twitter
Followers: 13,691
Following: 8,994
All vehicles
Customer Service
Conversation Youtube
Channel Views: 1,320,897
Total Upload Views: 7,722,853
Subscribers: 1,793
Joined: 4/12/2007
All vehicles
Owners Hyundai does not have a very large audience on social media in the U.S. but they have 18 Facebook pages in different countries with a relatively large following in Canada

Of all of their competitors, Hyundai has the lowest number of likes on Facebook, lowest number of followers on Twitter and the lowest number of subscribers on Youtube

Hyundai uses Twitter to converse with fans but not to address customer service issues

Honda has the largest audience on Facebook and Youtube but they have not used this to their advantage; they have low Twitter numbers and do not properly converse with their audience

Chevrolet and Ford are the 2 competitors that have the best handle on social media because they have a large audience and are using this as an opportunity to start a conversation about the brand and lifestyle of the owners Social Overview Press Reviews Awards 2007-2011 Hyundai Forums Hyundai is investing $600 million, with $300 Million to 8 auto parts manufacturers, in their new Brazil plan.
With new plants, Hyundai plans to reach 10% of Brazil’s market share (taking over Ford). Brazil Australia Hyundai has a 9.6% market share, best since 2003; increase of 16.7% from 2010 to 2011.
Hyundai is popular in Australia because they are stylish, safe, and quality focused.
Hyundai will target driving enthusiasts rather than budget buyers for the first time in Australia, importing the Genesis Coupe.
The brand seeks to attract a younger buyer with a more aspiring product. United States 21% increase in sales from 2010

Sonata Hybrid 2nd best seller in U.S in Hybrid Market

Hyundai and Kia, with their combined market share of midsized sedans ranked #1 in US at 19% -- surpassing GM at 18.8%

Hyundai and Kia received the second highest number of clicks on a U.S Internet site that gauges U.S consumer interest for car manufacturers and vehicles. (Ford was #1 ), showed highest interest in Sonata, k5, and Elantra. Hyundai owners and fanatics have multiple online forums to discuss their vehicles

Some are for Hyundai in general while others are nameplate specific

The conversations on the forums are all fairly similar and discuss issues that automotive forums address across all brands, including: repairs, DIY, pricing, MPG, debadging, experiences, advice, etc…

For the most part, customers seem to me genuinely happy with their Hyundai purchases but some of the common complaints were:

- Bad Gas Mileage on the Azera and Veracruz
- Terrible Salespeople and Customer Service at dealerships
- Lack of knowledge about vehicles by Hyundai dealers
- Auto reviews are giving too much hype to Hyundai
- Hyundai vehicles are safe
- Hyundai vehicles have very quiet and wimpy horns
- Many older people still have a negative perception of the brand because of
the quality of the older product Consumers China Hyundai’s sales in China rose 10% in 1st half of the year. They have 9 % of the Chinese market, 4th largest car seller, popular for medium sized cars such as the Sonata and Tucson (33% of total sales).

May 31st - Hyundai confirms it will develop a new brand exclusively for China to aim to provide a more tailored product for Chinese customers; it will be a 50/50 venture with Beijing Automotive Co. to develop their own car brand. India Market share rose to this year’s high in May selling 31,123 cars up 14.6% from last year. Hyundai has 19.5% market share (high demand of Verna in India).

•2nd fastest growing auto market in the world (after China), small cars constitute close to 70% of counties overall passenger car sales.

•Hyundai sold 187,918 vehicles January-June a 7.3% increase from last year. The i10 and i20 hit a half year sales record in India

•2nd largest manufacturing and largest passenger car exporter and maker in the country being Maruti Suzuki

•Most popular models are Santro Xing, i10, and the i20, accent.

•Who they are targeting: primary consumer is middle to upper income professionals who need true value for their money and a comfortable ride in city conditions. The secondary consumer target is college students who are looking for style and speed

May 9th – Hyundai launches “always around campaign” in India, 5th year in a row, as an initiative to reinforce the bond with valued customers as a mark of appreciation for their relationship with Hyundai.

Hyundai “Always Around Campaign” - (INDIA) - provided free check-ups for Hyundai customers at convenient locations. The campaign will provide a comprehensive 17 point check-up and a thorough examination of the vehicle and services such as tire and vehicle polishing, coolant and oil top-up. The Hyundai team will also collect suggestions and feedback on the performance of the vehicle & after sales service. The customers will also have a chance to see and test drive the latest Hyundai cars which would be there on display at the venue. U.A.E Hyundai launched its heavy truck range in Dubai, they made this move in hopes to become the biggest commercial vehicle provider in the country. Reviews and articles done on Hyundai and the different nameplates focus on similar topics including:


Fuel Economy

Assurance Program

Great features that come standard

Luxurious feel and design

Models prior to 2006 are risky

Models from 1989-1999 are no good

The ride is not very smooth Russia Press Solaris subcompact retained title of top selling foreign car in Russia in June 2011, surpassed previous monthly record set by Ford Focus. Nigeria July 1st 2011, Global Motors holdings Nigeria Limited has launched Hyundai Commercial Vehicles into the Nigerian Market. Eastern Europe U.K Hyundai looks to begin exporting cars made in Russia to Eastern Europe (Kazakhstan, Ukraine, Azerbaijan, Belarus, Uzbekistan, Moldova, Armenia, Kyrgyzstan).
These countries offer huge opportunities for long term growth; there is a limited presence of international brands in this region, and Hyundai’s early entry could help it stamp its dominance in this region. Europe Hyundai is the #1 Asian brand (Volkswagen, PSA Citroen, and Renault SA are top three). Hyundai has 4.7% of European market share selling 58,585 vehicles, but has had a slight drop from last month’s market share of 5.8%.
•Why so successful in Europe? Luxury look and ads – similar to Lexus, BMW- but costs less “Reverse snobbery effect in Europe, ostentatious consumption is out, smart shopping is in.”

Hyundai Joins Clean Energy Partnership- (Germany) -The Hyundai Motor Group signed a memorandum of understanding (MOU) with members of the Clean Energy Partnership (CEP) to help promote Fuel Cell Electric Vehicles (FCEV) and showcase the company’s competitiveness in eco-friendly vehicles.
The German Federal Government together with stakeholders from various industry sectors and academia set up the National Innovation Program to support the market preparation of fuel cell technology in Germany. The combined budget for the Program amounts to Euro 1.4 billion and covers the period of 2007-2016. Moving The World Together Hyundai “Moving the World Together” – Hyundai is pursuing a wide range of social contribution programs to achieve Hyundai’s global philosophy of “Moving the World Together.” This is Hyundai’s corporate social responsibility initiative which aims to contribute to society and help them be a better corporate citizen.

Hyundai donates 10 mobile clinics to African Nations, which will be utilized to offer basic medical services to residences of impoverished and remote communities in Africa. Hyundai is the #1 Asian Brand in the U.K -gained 4.6% of the market 1st 5 months of 2011
• i10 awarded best city car in January 2010
• ix35 awarded 5 star Euro NCAP – saying it is one of the safest vehicles in its class
• Santa Fe best Value 4x4
• i20 best bug super mini and small family car
• i30 voted most satisfying

June 27th – A British consumer’s rights group picked Hyundai as the “best car manufacturer” of 2011 for its high fuel efficiency and consistent efforts to improve quality. Hyundai Global July 12th - Hyundai and Kia ~ Hyundai Motor Group ~ emerges as world’s fourth largest global carmaker in 2010 on solid sales in the US and China. Their combined output just surpassed 6.6 million, up 23.6% from last year.

In 2010 Hyundai sold 3.6 million cars in 185 countries. They have 3 plants in South Korea and 6 overseas (USA, Russia, India, China, Czech Republic, Turkey)

Hyundai had a 12.3% increase in global sales in 2010, and a 22.9% increase in domestic sales.

Global Market share for 2010 = 5.2% Who is Hyundai? The company aims to achieve sustainable, profitable growth through the development of superior products, and customer-relevant technologies. The company’s top priority is achieving global competitiveness in an increasingly global environment. Hyundai has positioned themselves as a brand that offers a lot for a little

They are focused on features, awards and facts; they have a serious tone and fact based approach in much of their advertising to appeal to customers looking for true value

In offering their Assurance plan and America’s Best Warranty they’re showing that they have the customer's best interest in mind Brand Positioning Aspirational Target Hyundai is also trying to break into a new market by establishing themselves as a luxury brand with the Genesis and the new Equus *MotorTrend wrote an article on an interesting finding. *as compared to the Ford Fiesta *as compared to the Ford Focus *as compared to the Ford Fusion *as compared to the Ford Taurus *as compared to the Ford Escape *as compared to the Ford Edge *as compared to the Ford Mustang Upper Funnel Mid Funnel Lower Funnel Purchase Post Purchase Purchase Funnel Upper Funnel Hyundai has good Upper Level communications because they offer multiple websites and interactive opportunites to learn about the brand Upper Funnel Messaging Mid Funnel Mid Funnel Messaging Lower Funnel Lower Funnel Messaging Hyundai Mobile Website Dealership Experience Purchase Messaging Post Purchase How is Hyundai Now the 4th Largest Automaker in the World? In the social space, it appears that many Hyundai customers are unhappy with the dealership experience. On forums, this is a very big discussion topic and most say that their issues are:

Dealers are not knowledgable
Salespeople provide poor customer service
Owners have trouble with dealers while handling repairs/maintenance issues

In the past, many didn't want to own Hyundai dealerships because the vehicles were unreliable and hard to sell

Now, over 40 dealerships nationwide are under new management with more to come

Hyundai is looking to improve the facilities for 150 already existing stores

Company strategy is -- Improve the dealership network across the United States so sales per store increases, in turn affecting the brand nationwide Hyundai Assurance was one of the most innovative incentives in industry history

While thousands of people purchased Hyundais because of this, only 350 customers ended up returning their vehicles -- meaning more a sales at a small cost

With the Assurance Plan the company offered to buy back a customer’s car if they lost their job or became disabled, paying up to $7,500 of the cost of depreciation Hyundai focuses on making possible shoppers aware of the brand

Upper Funnel advertising says "We are Hyundai and here is what we stand for"

Hyundai Assurance is upper funnel advertising because it is a unique incentive to get Hyundai vehicles on the consumer's consideration list Mid Funnel messaging focuses more on features

Hyundai says "Now that you know us, this is what we offer."

At this point, customers are still considering 5 vehicles on average and are interested in features and styling to differentiate those options 2010 Genesis: Best Car for the Money

2010 Genesis: Vehicle Satisfaction Award, Aspirational Luxury Car

2010 and 2011 Sonata: IIHS Top Safety Pick

2011 Sonata: $25,000 Family Sedan Shootout

2010 Tucson: Vehice Satifaction Award, Compact Crossover SUV

Accent: 2008 Intellichoice Lowest Repairs Cost

Accent: NADAGuides.com, Best Car Buy

Accent: The Car Book, Best Bet 2009

Azera: Kelley Blue Book, 5 Great Deals

Elantra: Best Car for the Money "Most Successful Car Company in the US because of the Hyundai Assurance Program" - 24/7 Wall Street At this point customers are considering between 2 and 3 vehicles

In Lower Funnel messaging, Hyundai is pushing the Assurance plan and also identifying pricing

On the website, Hyundai is not doing anything different from their competitors

Hyundai Uncensored is a unique message that consumers appreciate; the campaign is very similar to Fiesta Movement

Uncensored Campaign at this level focuses on getting customers into the dealership for a test drive The Hyundai mobile site is easy to navigate and has all of the nameplates with: pricing, specs, photo galleries and colorizer

The site also has links to current offers, trade-in value info, Why Hyundai, Blue Link and Locate a Dealer

The site could be easier to navigate though; Toyota has a great mobile site because it doesn't open a new page with every link Purchase Hyundai allows customers to: print or save
Ford only allows customers to: print
Honda allows customers to: print, save, e-mail or Facebook Recommend
Toyota allows customers to: save, Like on Facebook or e-mail Nissan has the best Purchase Call to Action: Share (Facebook, Twitter, Delicious, Google and Live)
Also shows local dealers *Ford Summary Page Only Ford and Chevrolet show number of available vehicles in the area Global Perspective
Competition What are their plans? Goals and Plans
Market Strategy
Target Markets
BDI What are they doing in the community? Upper Funnel
Mid Funnel
Lower Funnel
Post-Purchase Sponsorships
Grassroots Purchase Funnel Findings Key Insights
Questions *Many Hyundai owners on forums are previous Hyundai owners At the end of the funnel, when customers reach the point of Purchase, the dealer site offers the most accurate information because they offer local deals and pricing

The Click to Chat option offered by LaFontaine Hyundai is a great way to answer customers' specific last minute questions At the point of Purchase, customers have narrowed their lists down to one vehicle and are now ready to go to the dealer and get the best price

Messaging now focuses on deals, savings, warranties and the Hyundai Assurance Trade-In Value guarantee

This is Tier 2 Advertising as it is now at the dealer level; the tone/theme of these ads are no longer in line with the Hyundai brand and more so just 'Sell, Sell, Sell!' Post Purchase Hyundai offers great options to Equus owners
iPad Owners Manual
Valet Maintenance Service

Although, it seems other Hyundai owners do not have the same luxuries
There is no Hyundai owner's online community (ex: The Ford Story) Strengths Weaknesses Opportunities Threats Strong brand image

Global operations

Still a low cost vehicle but now with better quality

Trade-in Value Guarantee

New luxury sports sedans bring new brand image

Focus on Research and Development to improve quality, reliability, durability and safety

High revenues and sales increases over the past 5 years

10 Year/100,000 mile warranties (the highest of any rival automaker)

Largest automaker in Asia, 4th largest worldwide Increasing inventory

Product recalls

Increasing production costs

Labor issues

Lack of consistent branding

Poor customer relations

Past company history

Luxury vehicles without luxury brand reputation

Some company information is scattered/hard to find Growing Asia Pacific new cars market

Increasing demand for hybrid/electric vehicles

Launch of new models/projects

Recalls/Mistakes from competitors

Reduction in costs

Possible entry in ship building business Weak economy

Young people want to drive well known brands

Foreign currency risk

Tightening emission standards

Intense price competition

Environment regulations

Political issues Key Insights Questions? Customers express their dissatisfaction on the Hyundai Facebook page with no response from Hyundai Of all American Express Black Card owners, 6% own Hyundais... the same percentage that own Bentleys and Audis Certified Pre-Owned Program
Mobility Program
The Military Program
24/7 Roadside Assistance Program Other Hyundai Programs With Hyundai’s introduction of Blue Link, technology has finally been aimed towards a newer, singular, more personally relevant goal: making your everyday life easier.

By allowing you to connect to Blue Link through any or all of three different methods – Smart Phone, In-Car, or Web Applications -- Blue Link technology enables and empowers you in whatever way is easiest for you.

Hyundai has come out with something to try and compete with auto technologies such as the Ford Sync. Now, the Assurance program is over and has been replaced with the new Trade-In Value Agreement Hyundai's target is not to make a profit this year but to increase market share

Based on January's data, Hyundai's U.S. market share is 7.1%, which would yield "skyrocketing volume" if the company held on at that level through a recovery a few years from now

The U.S. market constitutes about 40% of Hyundai's sales Marketing Strategy These websites direct traffic to the Facebook, Twitter and Youtube pages Innovative in their advertising and purchase incentives

Advertising has a consistent message of “forget what you’ve been programmed to think"

Strong Upper Funnel communications, people are aware of the new and improved Hyundai

Strong Lower Funnel communications, focus on providing value to the customer with low pricing and a large amount of local ads

Customer service is not strong, although incentives and pricing say, 'we care about the customer'

Social isn't used to sell Hyundais but instead to have casual conversation and build a customer relationship "But It's Still a Hyundai ..."

Although people agree that Hyundai has greatlty improved their quality,
many still see Hyundai as a brand that is acquired but not desired. Automotive Blogs Amongst the auto blogger community, Hyundai is a relatively large part of the conversation. There are articles on many topics, for example:

"In 2011, so far Sonata has outsold the Chevy Cruze, Honda Accord and Nissan Altima."

"Industry leaders need to be looking out for Hyundai as a serious threat."

"Although Hyundai Uncensored is a bite off of Fiesta Movement, it is a good move for the brand."

"Hyundai Assurance was one of the most genius innovations in auto industry history." Customer Commentary Online *pulled from a Nissan 350z forum
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