Though many have been told before and since, the parable of David and Goliath remains the quintessential underdog story. It’s an inspirational tale echoed in the worlds of business, politics, and in movies and sports.
Fictional and non-fictional out-of-nowhere triumphs come easily to mind: that of Nelson Mandela; Mahatma Gandhi; Rocky Balboa; The Karate Kid; the 1980 U.S. hockey ‘Miracle on Ice’; and most recently, Leicester City winning the English Premier League title—the list goes on and on.
You can find underdog stories in the auto industry, as well. They may not evoke as much emotion, but stories of underdog automakers have a lot of those same characteristics, and still resonate with enthusiasts and consumers.
Subaru, Mitsubishi, and Volvo all have underdog-type stories to tell. They are the little guys of the industry that want to get noticed, and whether its through quality, safety, or innovation, they’ve found ways to leave their mark.
It’s all about taking what may look like a lack of resources, or a disadvantage in your vehicle lineup, and turning it into a strength that separates you from the rest. Here’s how they do it.
Why being the ‘underdog’ can work
There’s no better place for an underdog to succeed than in Canada, a country that reels from a stinging inferiority complex with its U.S. neighbours but that prides itself – particularly recently – on being multicultural, respectful of everyone, and good at hockey.
Subaru, Mitsubishi, and Volvo all try to embody these Canadian characteristics—save maybe for the hockey part. “Volvo’s uniqueness shares a special connection with Canadians,” explains Alexander Lvovich, marketing director at Volvo Canada. “We have similar values of being authentic, understated, and trustworthy.”
Volvo’s uniqueness is what Lvovich likes most. He feels Canadian values align with the company’s Swedish roots, and that connection, along with the quality of its products, has set them up for a good future in Canada.
For Subaru, it’s about adapting to the Canadian marketplace. In the early 1990s, Subaru introduced the mid-size Legacy sedan and attempted to compete head-on with the Honda Accord and Toyota Camry. It didn’t go smoothly—not because the Legacy wasn’t as good, but more for the uphill brand-loyalty battles cash-strapped Subaru faced.
Instead, Subaru adopted a product-based marketing strategy positioning itself as a unique alternative to the mainstream brands. The company focused its attention not only on what Canadian buyers were looking for, but on what fit their active lifestyles.
Subaru still does that today, connecting to current and future customers via sponsorships of the Canadian Rally Championship, St. John’s Ambulance Therapy dog program, and Ironman competitions.
“We became a brand that connects with people in a meaningful way,” said Ted Lalka, vice-president, product management, marketing & customer experience at Subaru Canada.
“We first attempt to connect with people emotionally as a brand through our vehicles and events, and then we provide all those practical reasons such as full-time symmetrical all-wheel-drive and a lower-centre-of-gravity boxer engine that legitimizes their purchasing decision.”
As a smaller player competing in some of the largest segments in Canada, Mitsubishi’s taken a more business-minded approach. The Japanese brand understands it can’t be everywhere for everyone, and instead focuses on planning ahead and locating regions of the country where it has the most potential to succeed.
“We need to bring the right products to the right demographics in the right market,” says Tony Laframboise, current vice-president of sales and marketing at Mitsubishi Motor Sales of Canada, and soon-to-be president come April 1.
“Forty percent of our sales come from Quebec, and we have to always be aware of their preferences, which tend to lean to smaller vehicles and manual transmissions.”
If there’s anyone that can understand the Canadian market at Mitsubishi, it’s Laframboise, who was one of the company’s first employees when Mitsubishi came to Canada 15 years ago.
Thinking outside the box
Local strategies are vital for targeting specific markets, but these strategies are forged at the top. From a global standpoint, smaller companies cannot outspend mainstream brands in advertising and marketing, nor offer large incentives to entice a sale. And if you ask these automakers, the best for them to compete is through product.
A company’s identity is born through its vehicles. Styles and technologies will change over time, but the core message stays intact. Over decades, Subaru has put in effort making full-time symmetrical all-wheel-drive and boxer engines synonymous with its vehicles. Alternatively, Volvo’s built its reputation around safety, recently pledging no one will be killed or seriously injured in a new Volvo after 2020.
These companies have built foundations on these qualities, but they realize there needs to be more.
“People don’t always buy based on practical reasons,” says Subaru’s Lalka. “Qualities like reliability, safety, and residual values are all important, but they are box-checkers.”
The key is taking those unique attributes and designing them into a vehicle that can perform. Volvo accomplished that goal with its second-generation mid-size XC90 crossover, winner of the 2016 North American Truck of the Year, and is hoping to do the same with its new S90 sedan and V90 wagon.
Volvo’s fresh take can be attributed to two new global platforms: its Scalable Product Architecture and a Compact Modular Architecture. Those platforms, combined with the decision to only use four-cylinder engines, have changed the entire makeup of the brand by adding flexibility and reducing complications, and thus also finding savings.
“Focusing on product and maximizing our output is a big part of Volvo’s new approach,” adds Lvovich.
When it comes to design, Subaru is no slouch either, churning out emotion-evoking fan-faves like the WRX and WRX STI. The effect wrought by those cars is starting to trickle down, into vehicles like the sharply dressed Viziv seven-seat SUV being trotted around the auto show circuit, as well as the all-new, more rugged Crosstrek, unveiled at the 2017 Geneva Motor Show.
Mitsubishi’s strategy is a little different, since its North American sales account only for roughly 10 percent of its global total. Much of its business occurs in emerging markets – it’s what drew them into Nissan/Renault Alliance – and with that comes a more value- and warranty-based approach.
But that doesn’t mean the 100-year-old Mitsubishi is without its innovations. For the past few years, the Japanese brand has rolled out its All-Wheel Control and Super All-Wheel Control (S-AWC) in some models; the latter, found on Outlander and soon-to-be-standard on the new Eclipse, adds torque vectoring at the front axle for improved cornering and stability.
Making it last
One of the keys to making it as an underdog is building and managing relationships. I can only assume Leicester City and the 1980 U.S. hockey team had a great team camaraderie that played a major factor in winning those championships.
For the underdog automakers, the real way to get customers onto your team is simple: offer real value. Both Subaru and Volvo have taken home 2017 ALG Residual Value awards, with Subaru being named top mainstream brand by ALG and Canadian Black Book in its 2017 Best Retained Value Awards.
“Ninety-eight percent of Canadian vehicles [Subaru’s] sold in the last 10 years are still on the road today—our vehicles hold their value,” says Lalka.
Lvovich says the same about Volvo. “It’s not so much about the deal. People see what Volvo stands for and they appreciate that…in the end it’s all about reliability and durability.”
Mitsubishi stands by its product with an industry-leading 10-year/160,000-km warranty in Canada.
“We build our brand awareness and message of ‘Built Better, Backed Better’ with our warranty, the number one consumer reason for purchasing our products,” says Laframboise.
What to expect in the future
For the underdog automaker, its uniqueness that resonates with the consumer and sustains the business. Mitsubishi is trying different approaches through variant Black Edition models with the Lancer and RVR, as well as an expansion and major rebrand of its Canadian dealership network to better prepare it for a potential electrification rush in 2020.
On the other hand, Volvo’s placing itself at the forefront of autonomous technology, and is in business with transportation-mover Uber on developing a line of cars. But that shouldn’t surprise anyone, as Volvo has been on the front lines of technology for years. Lvovich calls Volvo’s autonomous technology “an organic next step” for the brand that’s been made easier by its global CEO having direct and regular communication with the R&D department and engineers.
Lastly, there’s Subaru, probably the least-underdog-gy of the underdogs. Subaru has freed up capacity in its Indiana plant by no longer producing Toyota Camrys in order to fulfil its ever-increasing orders. In 2016, Subaru sold over 50,000 Canadian units, and hopes to up that by continuing to focus on reasonably priced well-equipped vehicles it doesn’t need to incentivize on dealer lots.
In the auto industry, every underdog story is a bit different, but determination, ingenuity, and an emotional connection to the consumer are kind of common ground. There’s no winning or losing, but there are success stories to be written—and though they can be challenging stories to write, people still love reading them. They always will.