“It’s Hun-day, like Sunday” explained one of two Hyundai Superbowl ads, displaying an aggressive marketing investment by the Korean automaker of approximately $3 million. The ad portrayed competing car companies freaking out over Hyundai’s Genesis winning the North American Car of the Year Award.
Two Sundays later, Hyundai launched its first national advertising campaign at the Academy Awards, with eight spots on ABC’s telecast. Visits to Hyundai pages on Edmunds.com were up 27% compared with the same period in the previous week, and traffic to Genesis content was up 86%. Hyundai said traffic on its own website doubled on Oscar Sunday compared with the previous weekend.
Winning its first Car-of-the-Year award is a surprising but important milestone for the forty-year old Hyundai-Kia Automotive Group, but the company is now distinguishing itself with bold and confident marketing to go hand in hand with buoyant sales. “The crisis has provided Hyundai an opportunity, and they grabbed it,” said Kang Shin Woo, chief investment officer at Korea Investment Trust Management Co., which oversees $5.8 billion in equities, including Hyundai shares. “The aggressive marketing strategy gives them an advantage over rivals.”
The one-two Sunday punch carried a strong populist message, along the lines of, “An automaker that’s got your back. Isn’t that a nice change?” The message resonated with viewers because unemployment was rising and consumer confidence was falling. The combination of ad support and the deal itself was effective in getting the attention of the buyer but also tamping down fears of default.
For some Hyundai sales employees it’s starting to look like Sunday seven days a week. Hyundai’s market share nearly doubled in January, after the best year-over-year increase that any automaker has posted in the United States in the last six months. Hyundai reported sales of 24,512 vehicles in January 2009, a 14.3 percent increase over January 2008. Kia sales rose 3.5 percent. Combined, Hyundai and Kia were up significantly in a U.S. market that plunged 37%. For February, Hyundai Motor America announced sales of 30,621, down 1.5 percent from the same period last year, but up 25 percent over January 2009. Given total market sales were down 37% year-over-year and consumers are having a harder time getting approved for credit, Hyundai’s performance was all the more remarkable.
Hyundai’s best-selling model, the Sonata sedan, starts at $18,700 compared with Toyota’s $19,175 Camry. Sonata sales were little changed in the first two months of the year, while Camry’s plunged 38%. Strong sales of the Sonata sedan and Santa Fe crossover helped Hyundai stand with only three other brands in recording higher U.S. sales in the month of February compared with January 2008.
“Simply smoking,” is the way John Krafcik, CEO of Hyundai USA, described early sales of the automaker’s new Genesis Coupe. The stylish two-door is selling even better than the Genesis Sedan, even though Hyundai has focused more advertising dollars on the larger sedan. “Genesis represents everything we’ve learned about engineering great automobiles, and we’re delighted that the judges have recognized the good work of our R&D teams,” said Krafcik in an earlier interview.
Hyundai credited the strong sales to a clever finance incentive called Assurance, its offer to allow consumers to return their new Hyundai vehicles if they lose their jobs within a year. The Academy Award ads announced the launch of Hyundai Assurance Plus—a sweetener to the Assurance program that adds 90 days of payment guarantee to the existing protection plan for consumers that finance or lease a new Hyundai between Feb. 23 and April 30. “This program gets to the root cause of today’s economic concerns—fear of job loss,” Hyundai regional general manager Peter DiPersia said.
Established in 1967, Hyundai Motor Co. has grown into the Hyundai-Kia Automotive Group, which was ranked as the world’s sixth-largest automaker in 2006. By 2008 Hyundai had become the world’s fifth-largest automaker, ahead of Honda, Nissan and Chrysler, with 7% market share in the United States.
“We’re pleased to maintain our sales volumes on a year-over-year basis, especially in an industry under this type of economic stress,” said Dave Zuchowski, Hyundai Motor America’s vice president of national sales. “We’re seeing continued consumer interest in our Hyundai Assurance Program, and we’re continuing to gain momentum with the Hyundai Genesis which set a monthly sales record in February. New models like Elantra Touring and Genesis Coupe are arriving now in dealer showrooms, just in time for the spring selling season.”
Hyundai and affiliate Kia offered record incentives in February, said Jesse Toprak, director of analysis for auto-research firm Edmunds.com in Santa Monica, Calif. He estimates Hyundai offered a total of $3,031 per vehicle, while Kia’s spending grew to $3,546.
Hyundai’s Eastern sales region once again turned in the best sales performance in the country, with sales up 12 percent over last February, and 42 percent over January. “Our dealers are seeing increasing showroom traffic in response to our Super Bowl and Academy Awards messaging,” says Peter DiPersia, General Manager of the Eastern Region. “Consumers are also responding to our industry-leading warranty, our new Assurance and Assurance Plus programs, and our strong product lineup, all of which are resonating in today’s economy.”
Dealer Rick Case reported sales at his Hyundai dealerships in Davie, Fort Lauderdale, Georgia and Ohio were up 30 percent in March compared with February 2008. “Customers feel safe when entering a lease, loan or buying program with Hyundai,” Case said.
All new Hyundai vehicles sold in the U.S. are covered by ‘America’s Best Warranty’. In addition, the Hyundai Assurance Program is now offered on all new Hyundais leased or purchased at a participating Hyundai dealership. Hyundai Assurance provides protection from certain income-changing life events, allowing consumers to return their vehicles in the first year of ownership without impacting their credit histories, while covering vehicle depreciation (negative equity) up to $7,500.
For a limited time, Hyundai is also offering Hyundai Assurance Plus, adding 90 days of payment relief to the existing protection plan. Hyundai Assurance Plus is part of Hyundai’s Spring Sales Event, which runs until April 30, 2009. Hyundai Assurance and Hyundai Assurance Plus are complimentary for the first 12 months of ownership. The programs supplement all existing consumer incentives, and are available to any consumer, regardless of age, health, employment history or financed amount of the vehicle. Hyundai Motor America, headquartered in Fountain Valley, Calif., is a subsidiary of Hyundai Motor Co. of Korea. Hyundai vehicles are distributed throughout the United States by Hyundai Motor America and are sold and serviced by more than 780 dealerships nationwide.