Toyota Motor Sales USA's Lexus, the No. 1 selling luxury marque, sent requests for proposals to consultants to help develop a road map to the future.
"We haven't done anything of this magnitude" since Lexus launched in fall 1989, said VP-Marketing Mike Wells. "We want to keep this momentum going. We want to clearly identify that Lexus magic. Now is the time to figure out Lexus' DNA."
The marketer wants research with consumers and Lexus dealers to get to the soul of Lexus. It also wants brand, product and owner strategies, and educational tools for dealers and the automaker itself, said two executives who asked not to be named.
The project comes as Lexus enjoys record U.S. sales even in the middle of an economic slowdown. Still, several industry insiders suggest the research move marks a fault line with Publicis Groupe's Team One Advertising, El Segundo, Calif.
Not so, maintain both Lexus and Team One.
"We have a great agency," Mr. Wells said. "They are our business partner and have as much as we do to gain from this" project.
Tom Cordner, co-chairman-executive creative director at Team One, which long-time Toyota shop Saatchi & Saatchi set up to handle Lexus, said, "This has very little to do with advertising. It's a full 360-degree look at the entire company."
Mr. Cordner said Mr. Wells "has an affinity for research" and is "looking for a way to measure how to move [the brand] forward."
Mr. Cordner's co-chairman, Brian Sheehan, said the agency is "working hand-in-hand" with Lexus on the RFP.
Toyota's own year-old internal research revealed the Lexus brand is ill-defined in consumers' minds, although it is known for quality and luxury. U.S. Lexus executives want more input into the vehicles developed by its parent in Japan, one executive said. The Lexus nameplate doesn't exist in Japan.
Even group VPs-general managers of Lexus, Bryan Bergsteinsson in 1999 and Denny Clements in 2000, publicly discussed consumer perceptions that the marketer made boring-looking vehicles.
Mr. Wells disputed the issue of whether Lexus is ill-defined. "Non-owners may say that, but our buyers get it," he said.
Nancy Hubbell, public-relations manager at Lexus, said the marque is embarking on the consulting project to ensure "our brand stays with the times and stays with our customers." She said RFP recipients are "performance-development companies, not ad agencies," declining to identify them or confirm the multitask assignment could last up to 18 months.
An executive aware of the project indicated 12 companies have been contacted. One speculated the RFPs went to big, well-known consultancies like McKinsey & Co., Boston Consulting Group, Ernst & Young or the Gallup Organization.
The auto marketer's move does not come at a time of desperation, but of rising sales. Lexus was the nation's best-selling luxury brand in the first half of 2001 and in calendar 2000. Last week, Lexus reported its best-ever June sales of 19,117 units, an 18% jump over June 2000. It signaled the brand's 13th consecutive month of record sales. Vehicle sales in the first half of 2001 totaled 109,742 units, 17% better than a year ago.
Still, the marque's top-selling model in 1999 and 2000, the RX300 sport utility, has seen sales skid this year. Fresher, newer upscale SUVs are on the market now, including American Honda Motor Co.'s Acura MDX and BMW of North America's X5.
Like Toyota, Lexus is working to draw in younger customers. The research could help achieve that and other Lexus goals.
Lexus is the strongest of the three Japanese luxury brands, which include Acura and Nissan North America's Infiniti, said Brett Hoselton, senior auto analyst at McDonald Investments, a securities firm. Still, "Lexus has not been able to break out of the image of a high-priced Toyota with a lot of features," he said. The same positioning that built the Toyota brand-quality, reliability and durability-won't work long-term in the luxury category because upscale buyers will demand that from all brands, he said. "Lexus has OK-looking cars with probably competitive performance and good quality, but none of it is compelling."
Lexus rejiggered its brand tagline last fall from its original 1989 "the relentless pursuit of perfection" to "the passionate pursuit of perfection," said Team One's Mr. Cordner. The new tag is meant to be more emotional.
Jim Hall, VP-industry analysis at consultancy AutoPacific, said the Lexus brand "slipped as they added product with no continuity." There's "no family appearance" in the styling from Lexus-to-Lexus models and "nothing that ties them together," he said. Mr. Hall pointed to the IS300 sports sedan, developed in Japan by Japanese engineers who produced their version of a competitor against BMW's 3 series without understanding that competitive model's global image. "The BMW 3 series is a world car that's the same in Paris or Katmandu. That kind of consistency you can't buy."
Lexus' Mr. Wells disagreed the Lexus lineup is disparate. "You can see some similarities," he said.
Since 1989, Lexus has had a series of general managers and marketing chiefs who have shifted ad themes and product attributes. In 1998, different models had different taglines to reflect different personalities. For example, launch ads for the RX300 that year carried the tag, "It's not just another SUV. It's like no other vehicle on earth," while the GS400's tag was "the relentless pursuit of exhilaration."
Lexus has been consistent on one score: Other than General Motors Corp.'s Cadillac and Ford Motor Co.'s Lincoln, all other major upscale car marques have changed ad agencies since Lexus debuted in 1989 with Team One.