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Audi Seeks to Define Brand in U.S.
By GINA CHON
May 7, 2007 3:34 p.m.

With a fleet of new models, Volkswagen AG's Audi brand has ambitious plans to accelerate out of the shadows of its luxury competitors. But first, it needs to explain to U.S. consumers just what an Audi is.

Audi is aiming to do just that with a new advertising campaign that kicked off Monday. The "Never Follow" tagline is gone, replaced with "Truth in Engineering," which is aimed at showing that Audis are what vehicles should be all about. The ads show how engineering results in a better driving experience when it comes to safety, quality and performance.

One of Audi's major problems is that it has never had a comprehensive brand marketing strategy in the U.S. and instead preferred to rely on its products to do its advertising. But successful luxury marques in the U.S. all have a strong brand identity. Toyota Motor Corp.'s Lexus brand found success based on its reputation for building reliable, super quiet cars. BMW has long been known as the "ultimate driving machine." Mercedes has rebounded with new models designed to reinforce its image as the pinnacle of luxury.

And Audi? "We seem to be faceless," says Johan de Nysschen, executive vice president of Audi AG's U.S. office.

As a result, Audi has long lagged behind its competitors. Audi sold more than 90,000 vehicles in the U.S. in 2006, a first for the company, and for the first four months of this year, sales are up by 15%. But Lexus sold more than 322,000 vehicles last year. The BMW brand sold more than 274,000 cars and SUVs.

"There's got to be something that Audi can own, an attribute that people can assign to it so they know immediately it's an Audi," said Gene Cameron, an executive director at J.D. Power & Associates who studies brands.

In the past, Audi executives in Germany also treated the U.S. market as if it was a province in Germany as opposed to a unique market. Mr. de Nysschen said Audi has realized, albeit a bit late, that the U.S. market is too competitive to rely solely on its product lineup to sell cars.

Now as other luxury brands reposition themselves and tout gadgetry that removes the driver from the driving experience, Audi says it is pitching itself as the straightforward, steady brand that will always be about the driving experience. For example, BMW has always been known as the "ultimate driving machine," but its recent marketing campaign has focused more on its corporate culture of independence to reach a broader audience. Lexus is trying to move more upscale in its image as it adds pricier vehicles to its lineup.

"You see this every few years where luxury brands change their message," said Scott Keogh, an Audi marketing executive who was hired last year after a ten-year stint at Mercedes-Benz. "We are putting our foot in the ground and saying this is who we are."

One of the new commercials focuses on the A4 sedan and shows the vehicle being parked on a neighborhood street between two competitors. The ad states that Audi is "for people who can park themselves," again to emphasize the driving experience. The ad indirectly takes a jab at Lexus, which has a self-park system on its new LS sedan.

To help Audi put a face on the brand, Mr. Keogh replaced longtime Audi agency McKinney with Venables, Bell & Partners based in San Francisco. Mr. Keogh said after years of being a rational, understated, well-behaved brand in the U.S., Audi needs to break out of its shell and make some noise. The new marketing campaign comes at a time when Audi is launching the TT sports car, the S5 coupe and R8 sports car. Next year, it will have a redesigned version of the high-volume A4 and a small SUV called the Q5.

"It's time to get out of this semi-underground mode and state with confidence who we are," Mr. Keogh says.

To help educate consumers about Audi, the brand is holding more events that are aimed at generating publicity -- something that would've seemed tacky to Audi in the past. Audi opened with much fanfare last year a new brand showroom in midtown Manhattan called the "Audi Forum." To get attention, Audi arranged for New York Mayor Michael Bloomberg to roll up to the event in an Audi R8. Later that evening, Audi hosted a party at the showroom that included Woody Allen's jazz band. Comedian Stephen Colbert told jokes and singer Wyclef Jean performed.

Because Audi is outspent by competitors BMW and Mercedes-Benz, Mr. Keogh said the brand will be treated like an unknown political candidate. As a result, the marketing team developed a grassroots campaign that relies on word of mouth and viral marketing, in addition to traditional media campaigns.

"We want to start with a spark and have that spread," Mr. Keogh said. "We don't need to talk to 100 million people."

The first two television commercials of the campaign focus on the new TT sports car and are 15 seconds long. The ad asks viewers "Do You Have a Moment?" and then shows a barrage of images in less than a second, making it what Audi calls "the world's fastest commercial" to relate it to the high-performance TT. The ads are aimed at consumers who have digital video recorders so they can rewind the commercial or view it in slow motion.

Mr. Keogh says the ad is ideal fodder for bloggers and is meant to be shared so people can discuss what they saw in the split second-ad. The commercials will appear on prime-time network shows, such as "American Idol," "Desperate Housewives" and "24." Audi will post all of its ads on the Web site, www.insideaudi.com, in hopes that it will lead to postings on YouTube and other sites.

"Audi needs to increase their share of voice in the market because it's been pretty small when compared to its competitors," says Miles Richardson, general manager of University Audi in Seattle

beltsander TKO

i feel like it's a "small" enough community, that whenever i bump into another audi driver, the chances are greater that they are also enthusiasts.

5 or 6 years ago, if i waved at another a4 driver, they'd wave back. i get that same sense of community with the q when other q drivers give me the thumbs-up, or when i do the same.

i wonder how things will change as more people are aware of this marque, and to these new owners, the audi is just another expensive car...

Q7Ash

Audi the car company won't change though.

1990V85speed

Us "old timers" said the same thing ten plus years ago when all you "youngsters" came on-board. You all turned out to be great Audi enthusiasts. We can only hope that the newest owners will be just like us.