It is a rare occasion when a car manufacturer shares future product information with outsiders.
College of Charleston School of Business students were treated to not only photographs of planned new models up to 2016, but future marketing and sales strategies as well.
Last week Steve Cannon, vice president of marketing for Mercedes-Benz USA, captured the attention of some 200 School of Business students in an outstanding presentation. Of major importance was Cannon's description of the future customer base for several upcoming models.
First of all, the business students were shown several new Mercedes-Benz versions. These new models included fully electric cars "with a range of 60 miles," smaller cars with either gasoline or diesel power, a "sporty" four-door; a compact-sized hatchback and a brand new crossover model.
The Mercedes-Benz executive revealed how seriously concerned carmakers are with the present political climate here in the U.S. and controversial, published mileage standards.
One of Cannon's responsibilities is to make certain Mercedes motorcars will meet American's tastes and — anticipating what is coming down the road — an average of 54.5 mpg by the year 2025. "All carmakers are scrambling to meet U.S. regulations. This will call for downsizing cars of the future, taking weight out of cars, replacing V-8s with 6s and so on down to four-cylinder cars," he says.
Obviously, the new standards will push automakers into producing hybrids and electric cars. So far, there has been a reluctance from the car-buying public to buy.
As Cannon pointed out, a recent marketing study predicted that by 2020, only 15 percent of car production will be electric or hybrids. Yes, 85 percent of auto buyers will still prefer gas-powered vehicles.
He made another interesting comment about current electrics now on the market: "The U.S. is a suburban culture. Present electric cars are a third car in the household, when (if gas prices hit $5 a gallon, people will downsize."
Regarding diesels, Cannon observed, "If Americans switched to cars with diesel engines, it would mean no (oil imports from Saudi Arabia. "
Why was a marketing manager of a 125-year-old German luxury carmaker devoting so much time to a group of college students?
Mercedes-Benz is taking seriously a study by Deloitte Consulting: "The future of the auto industry will likely be driven by the choices and tastes of Generation Y. At 75 million strong and coming of age, this Generation may re-shape everything, and the auto industry better be ready."
One way Mercedes is getting ready is by collaborating with future customers, Cannon says. The company is currently communicating through literally hundreds of means, such as social media through its entity, Generation Benz. The Generation Y age group is 18-34. The average age is 29, with 80 percent male and 67 percent single.
Marketing executive Cannon calls the group "digital natives," who have been brought up in the age of YouTube, Facebook, Google, Twitter and many more. He cited these amazing statistics:
• YouTube: There are 2 billion YouTube video views per day.
• Facebook: 750 million people are on Facebook, including 48.6 percent of the U.S. population. One out of five worldwide Facebook accounts are in the U.S.
• Twitter: 220 million people are on Twitter.
Cannon looks at Twitter as "a distribution center."
With these facts in mind, Cannon has led the Generation Benz community activities, which includes surveys, polls, live chat sessions, focus groups, test drives and multiple events, including auto shows, the PGA Tour, U.S. Open tennis and more.
The key question put to Generation Y: "What makes you click? "
Having the information assists in developing future product programs, as well as marketing strategies. After all, that 75 million potential customer base is worth pursuing.
Today's media market is fractured as never before. As Cannon pointed out, 30 years ago, the media encompassed newspapers, magazines, radio and television. As shown in today's discussion, that is no longer true.
Cannon proudly pointed out that since Karl Benz invented the horseless carriage in 1886, Mercedes-Benz "has been on the cutting edge of change. "
The marketing planning and execution at Mercedes are under the capable hands of Steve Cannon, one of the most energetic, charismatic and, not surprisingly, enthusiastic, auto executives.
He says his job is "to polish the star:" the Mercedes-Benz star. The School of Business students were convinced it is working.
Dr. George G. Spaulding is a retired General Motors executive and distinguished executive-in-residence emeritus at the School of Business at the College of Charleston. He can be reached at 2 Wharfside St. 2A Charleston SC 29401.
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