RENEWING THE NISSAN BRAND ` Presented by : Mahendra Bohra Anitty.S E.P.John Bhuvaneswari.G Susheel.S Bikash Sahu (1st year MBA. Sec-B)
VISION / MISSION VISION Nissan : Enriching People’s lives MISSION Nissan provides unique and innovative automotive products and services that deliver superior measurable values to all stakeholders* in alliance with Renault. * Our stakeholders include customers, shareholders, employees, dealers, suppliers, as well as the communities where we work and operate.
NISSAN BACKGROUND1933 – Started as Jidosha Seizo Co. Ltd1934 – Changed to Nissan Motor Co. Ltd.1944 – Headquarters Shifted to Tokyo1950 – Acquired Stake in Minsei Diesel Motors Co. Ltd.1952 – Technological Cooperation with Austin Motors1958 – Exports to USA1959 – First overseas factory at Taiwan1966 – Merged with Prince Motors Ltd.1980 – Garner the worlds biggest auto market1990 – Nissan’s decline started
Reasons for decline Lack of individual identity Loss of the brand image Volume driven , not profit driven culture Increased debts
LACK OF INDIVIDUAL IDENTITY Spend its resources in copying Toyota. It lost most of its money competing over incentives and dealer discounts with other brands while they were sold at premium. It tried to target other brands customer rather than creating their own image, i.e. lack of proper segmentation and targeting. Thus positioning itself as a follower rather than leader even when it had the potential to do so.
Loss of brand image It entered the American market as an brand known for its innovation in engineering but could not maintain it. The brand stood as the ultimate driving experience with its models like”240z”, “Datsun 510 sedan” but slowly became just an value addition models after Toyota and Honda.
Increased debts Due to all the above causes the sales of the company started declining leading to stagnated debts pilling up. Also the slow down of the market due to the increased oil prices added to the crises. This debts pressurized the company to switch to volume driven and not profit driven in order to generate more revenue to repay the debts , which further worsened the situation.
(B illions of Y en)350030002500200015001000 500 0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Volume ,not profit driven Fall in sales lead to the company to increase the incentives to the dealer to provide preference to the brand over the other brands. They concentrated only on the no of vehicles sold and not the contribution of each vehicle. This weakened the company’s internal financial structure.
High Costs, Production Lag, Over Capacity Unrelated Outdated Product Line, Keiretsu System Investment Deep DebtsLow Margin PRODUCTION HighHigh Fixed InterestsCost PROFITS INVESTMENTSBetween BranchesBetween Departments OutdatedBetween Global Divisions Models DECLINE No New OF Designs NISSAN COMMUNICATION PRODUCTS Poor Marketing HR MARKETING Poor BrandLabor Problems PerceptionCulture Dealers
Carlos ghosn He was the man responsible for the most remarkable corporate turnaround ever. He is French born and was a part of the Nissan’s alliance with Renault. He restructured entire policies of the company. He had proper assessment and knew the exact missing elements in Nissan
MISSING ELEMENTS Clear profit orientation Focus on customers targeting Brand positioning Sense of urgency Proper communication (internal and external) Too much focus on chasing Competitors.
Ghosn’s plans Ensured financial discipline in the company. Communicated the goals and targets boldly. Restructured the organizational structure. Introduced new marketing strategies. Nissan 180
NISSAN REVIVAL PLAN’S OBJECTIVEThe objective is to free resources from non-strategic, non-core assets and investment more incore business - cars - while at the same significantly reducing Nissan’s debt. “The aim is to grow the company, not shrink it.” said Ghosn.
Financial ascertainment Restoring profits: from current 1.5 % to 4.5 % He made clear and bold statements “if I don’t reach these targets within one and a half year, I an out. But all the executive you see around here are out ,too ”. Introduced Nissan 180 .
NISSAN 180 To sell 1 Mn additional units. Achieve op margins of 8% Zero net automotive debt.
CROSS FUNCTIONAL TEAMS The key player in the cross functional team was “MARK PERRY” the director of the cross functional team. His all round knowledge in the marketing , engineering , manufacturing combined formed the back bone of the CFT’s. He was also with the company since the beginning making him aware of all the situation first hand. It changed the perception of “we” to whole company rather than just the team.
These teams reduced the barrier between the design and engineering thus enabling the design to realize the brands true potential. Encouraged the engineers to design high performance cars with involvement of the brand championship through marketers. Now the engineers could design the cars based on the marketers inputs making them more consumer friendly.
CROSS FUNCTIONAL TEAMS Most cross-functional teams are dysfunctional Most companies aren’t aware of this problem The irony is that cross-functional teams are the arteries of an Organization
COMMUNICATIONS Between Branches Between Departments Between Global Divisions
Building the brand “Nissan” Identifying the brand DNA Ghosn gave the entire task of marketing and branding to Perry and Tackes who identified its core elements Brand personality : bold and thoughtful Core customer values : people “who set their standards and maximize life” Brand function : fusion of advanced technology with design for human benefits and provide superior agility and responsiveness. Introduced the Nissan timeline as a remembrance of the Nissan culture
Establishing the individual brands Once the corporate brand was developed it started focusing on the various individual brand keeping the core values constant. Altima , maxima , xterra as the cars meeting the unmeet needs Each with a different character meeting the needs and the wants of the different people, i.e. made especially for them. The xterra marked the start of the focused targeting for only rough and adventure loving people.
SHIFT It was a simple ad campaign but acted as the connecter of all the individual brands to the corporate brand. Depicted the new and the changing perspective of the Nissan brand. Strengthened the corporate brand . Created public declaration of the brand Nissan.