A strong brand can even overcome product performance problems according to a new study just released by Zpryme Research and Consulting. The study, “Electric Vehicle Branding,” was sponsored by Airbiquity, a global telematics connectivity provider.
Toyota, despite recent recalls and questions regarding the safety of its vehicles, demonstrated the highest level of brand loyalty, with 57% of Toyota owners indicating that they would prefer a Toyota electric vehicle (EV) to that of any other brand. Honda placed a close second with 54%.
According to the study, Ford, Chevrolet, and Nissan formed a second tier in transferring brand loyalty from conventional vehicles to EVs. Ford and Chevrolet, the two leading American brands, had 48% and 43% of owners indicate a preference for their current brand in an EV.
While the report focuses on the automobile industry, it offers some potentially very useful insights for hybrid and electric truck manufacturers and purchasers, as well. If the study is a correct indicator, a strong brand can help companies to springboard over competitors as they move into emerging markets, even in the face of serious and persistent product performance problems in their core businesses.
According to the study, “the popularity of both Toyota and Honda and their reputations for producing quality automobiles made this a predictable outcome. Owners of Toyotas and Hondas typically drive sedans that offer a balance of practicality, affordability, and trust. These drivers view the brand of a car as a stamp of quality that would assuage fears regarding the reliability and value of an EV.
“Furthermore, both Toyota and Honda undoubtedly have benefitted from building hybrid cars (e.g. Toyota Prius, Honda Insight) that have successfully penetrated the U.S. market and proved to be reliable and economical. The success of these hybrid models, along with the wide range of popular vehicles they offer, demonstrates that Toyota and Honda build quality, innovative vehicles in all vehicle classes. The strength of Toyota and Honda’s brands and loyal customer base add tremendous value for any push they make into the EV market.”
Differentiation and branding will play a key role in determining which companies succeed in profiting from EVs, a fact that is no secret to industry leaders and outside analysts, notes the report.
“Brand is more than mere design nowadays,” Mariana Gerzanych, CEO of 350Green, is quoted as saying. “It’s a set of expectations times the emotional value consumers attach to a product. In the case of electric vehicles, the emotional value, if not present already, builds up fast. The brand that will exceed expectations will become “the choice.”
Zpryme asked U.S. drivers two questions: 1. Would drivers prefer the same brand of EV as their current vehicles or a different brand? 2. How likely would a respondent be to purchase an electric vehicle over the next two years?
Hyundai owners emerged as the most likely candidates to actually purchase an EV in the short-term, with 45% of Hyundai owners who responded to the survey expressing interest in EVs.
“While this finding initially may be surprising,” notes the report, “reasons for this result can be found in the market segment that Hyundai targets. Hyundai attracts drivers that place more weight on affordability and value. The lower cost of maintaining an EV, particularly with rising gas prices, is a factor that appeals to their drivers. Hyundai owners are also less likely to be influenced by the history of a brand and willing to buy vehicles without an established pedigree.”