Brand diversity: The double-edged sword

February 24, 2009

How can a company maintain a healthy, diverse brand portfolio, when the consumer base is spending less and less? The Big Three automakers have been facing this dilemma for a while now, as the economic climate and consumer shift to smaller cars have battered the automotive industry. That product brand diversity is now a weight, dragging them down. And no amount of government handouts will lighten the load.

Chrysler is now bringing their three car brands: Chrysler, Dodge, and Jeep together, by bringing them into the same dealership lots, and into the same advertisement campaigns. This is a good step, but the brands will still compete against each other, just in closer quarters.

General Motors is the largest of the Big Three, with a grand total of eight car brands: Chevrolet, Buick, Pontiac, GMC, Saturn, Hummer, Saab, and Cadillac. GM has been on the top partially because of their product diversity. But now, maintaining 76 different car models between those eight car brands is too much. GM is now finally considering cutting off half of those brands: Pontiac, Saturn, Hummer, and Saab. This significant pruning will hopefully make GM stronger over time.

Of the Big Three, only The Ford Motor Company has a line up of brands that make sense from end-to-end. Throughout this crisis Ford is acting like the leader of the American automotive industry and I believe it is poised to come out of this downturn in the best position for long-term success.

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