I found this interesting article on mashable that I wanted to share with all of you. With a brother who has worked in the automotive industry almost his entire life and a family life built around the automotive industry and working either in it or with it, it was interesting to see a different perspective. I knew from offline conversations with friends and family that Toyota would come out of this better off for having handled the crisis correctly. It’s nice to see that conversations and opinions are shared.
I found this interesting article on mashable that I wanted to share with all of you. With a brother who has worked in the automotive industry almost his entire life and a family life built around the automotive industry and working either in it or with it, it was interesting to see a different perspective. I knew from offline conversations with friends and family that Toyota would come out of this better off for having handled the crisis correctly. It’s nice to see that conversations and opinions are shared. Enjoy!
There’s no question that Toyota is in deep trouble with its current recall crisis. But could these issues actually be helping its brand? Shockingly, an analysis of Toyota shows that its Social Influence Marketing (SIM) Score saw an uptick in January. Who’d have thought that a crisis of such significant magnitude could actually help a brand’s perception? This seems to be true, at least in the short term, even though sales may be dropping. Let me explain how.
A Look at the Numbers
There are a number of ways to track brand perception. During my time at Razorfish, I have helped develop the SIM Score, a basic equation for calculating how a brand is faring on the social web.
Inspired by the Net Promoter Score, the SIM Score measures a brand’s health on the social web and is determined by calculating the total market share of consumer conversations for the brand, adjusted for sentiment in relation to its competitors. The table below outlines the exact formula for calculating a brand’s score. The data can be sourced using any major conversation monitoring vendor that tracks mentions and sentiment for a brand and its key competitors.
This computation provides an indexed score — the degree to which consumers like or dislike the brand when they talk to each other about it on the social web. In a nutshell, it includes a measure of reach (volume) and of likability (sentiment), combining them to give the indexed score relative to a brand’s direct competitors.
Between the months of November, December and January, the Toyota SIM Score (calculated using data sourced from Radian6) moved from 19.8 down to 17.56 and then up in January 24.84. If you look at the graph below, Toyota’s SIM Score increased at the expense of Nissan and General Motors. Ford saw a very slight dip too.
Why the Uptick?
How can the Toyota recall be helping the brand? There are two answers for this.
The first is that the increased number of conversations about Toyota are building greater awareness for the brand even though many of the mentions may be negative. While this may seem unusual, the fact that people are talking about the brand a lot more and sometimes in a neutral light (not just negatively) is increasing its exposure. More people are talking about Toyota than any other brand these days. And they’re talking about the recalls, but also the fixes being provided by the dealerships too. And some of the consumers are probably coming to the defense of the brand too. Maybe there is some truth to the adage that there’s no such thing as bad publicity after all.
The second answer comes via Jeremy Anwyl, the CEO of Edmunds.com in an interview with CNN on February 5th. He explained that people have sensed an opportunity to pick up a bargain and are moving towards some of the Toyota models. Edmunds research showed that before the recall, 7.4% of the consumers in the market for compact cars were considering a Toyota Prius, and after the news broke, the number moved up to 8.7%. Edmunds’ research measures online purchase behavior against conversations on the social web.
What does this tell us? Firstly, that the SIM Score fluctuations and the related Edmunds user intent analysis have unearthed a counterintuitive trend with regard to Toyota; increased buyer interest even though there’s a lot of bad news about the brand. It also shows that there hasn’t been significant short-term damage to the Toyota brand on the social web, at least relative to its direct competitors. This of course is likely to change, as more news about Toyota’s troubles have broken since January, and more people are talking about it online today. I fully expect the Toyota SIM Score to start dropping again when the February numbers are computed. It is worth pointing out the SIM Score is a measure of a brand’s health on the social web and not always a leading indicator of sales, though it can be for certain product categories.
Toyota’s Next Step
What should Toyota be doing? First, it is obviously most important for them to solve the problems with their cars. That’s a no-brainer. But they also have to start talking to consumers more directly on the social web. So far, it seems that their responses have appeared a little slow and clumsy. Giving consumers information about the recall in more human, easily understandable and digestible pieces of content is key. They should explain exactly what they’re doing, why things will be different in the future, and how the engineering problems developed. And as soon as the clouds pass, Toyota should talk about the amazing deals that they have. It is obvious that consumers are interested in them.