Chapter Preview plored the basics of market- fers that deliver more value than the offers of competitors seeking to

18 Chapter Preview plored the basics of market- fers that deliver more value than the offers of competitors seeking to

Creating Competitive Advantage

In previous chapters, you ex-

tage, companies must use this understanding to design marketing of-

ing. You learned that the aim of marketing is to create value for win the same customers. In this chapter, we look first at competitor customers in order to capture value from them in return. Good market-

analysis—the process companies use to identify and analyze competi- ing companies win, keep, and grow customers by understanding cus-

tors. Then we examine competitive marketing strategies by which tomer needs, designing customer-driven marketing strategies,

companies position themselves against competitors to gain the great- constructing value-delivering marketing programs, and building cus-

est possible competitive advantage.

tomer and marketing partner relationships. In the final three chapters, Let’s first look at Korean carmaker Hyundai (rhymes with Sunday). we’ll extend this concept to three special areas: creating competitive

When the Great Recession of 2008 battered the automobile industry, advantage, global marketing, and social and environmental marketing

most car companies slashed their marketing budgets and battened sustainability.

down the hatches to weather the economic storm. But one company— In this chapter, we pull all the marketing basics together. Under-

Hyundai—did just the opposite. It increased its marketing spending as standing customers is an important first step in developing profitable

rivals were cutting back. And it found just the right value proposition customer relationships, but it’s not enough. To gain competitive advan-

for the changing economic times and marketplace.

Hyundai: Hitting the Accelerator When Competitors Throttle Down

C ing. Escapism was the order of the day, and most advertis- egy in the face of the economic downturn produced stunning re-

onsider the state of affairs when viewers tuned promise in an eye-popping nine high-profile spots on the into the Super Bowl in February 2009. Banks

Academy Awards.

had failed, the stimulus package still hadn’t been announced, and unemployment was surg-

Hyundai’s aggressive, customer-focused marketing strat-

ers played right along, with brands like Bud Lite and Coke sults. The Hyundai Assurance program resonated with offering happy-happy, joy-joy ads that jarred with reality.

debt-wary consumers, and Hyundai’s sales rocketed 59 percent There was one advertiser, however, that didn’t. In the third

for January and February 2009 as compared with the previous quarter, in an otherwise standard-issue, cars-rolling-through-

year. Nielsen’s postgame survey showed that 43 percent of par- the-landscape spot, a voice-over brought into the light of

ticipants who saw the ads improved their opinion of Hyundai. day something that most people didn’t want to talk about.

The Hyundai Assurance program, “made people feel Hyundai “Now finance or lease a new Hyundai, and if you lose your

cared about their situation—that they were sympathetic,” said income in the next year, you can return it with no impact on

one analyst. The ads said, “We hear you. We understand. We’re your credit.”

in this together.”

With that bold stroke, Hyundai—yes, Hyundai—an Hyundai’s competitive marketing strategy is all about op- automaker not historically known for fearless marketing,

portunity, aggressiveness, and speed. In 1986, then virtually un- began in earnest a frontal assault on a recession that was

known Hyundai entered the U.S. market with its small, not only dampening consumer enthusiasm but also drown-

entry-level Hyundai Excel, priced at an incredibly low $5,000. ing it. Then, in sharp contrast to the tail-between-the-legs

After some early success, Hyundai hit a speed bump with de- mode of Hyundai’s rivals, many of whom had slashed their

sign and quality. The car’s outdated looks, underpowered en- marketing budgets, the Korean carmaker put the pedal to

gine, and flimsy engineering made it the butt of jokes by the marketing metal by repeating the Hyundai Assurance

late-night comics. David Letterman once joked that if you