Mazda repositioning begins to show results

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Mazda North American Operations has its groove back after floundering for years by chasing mass-market automakers.

"We looked at Toyota and Honda too much in the '80s and '90s," said Charles Hughes, who assumed the automaker's helm as president-CEO in fall 2000. "When you're not one of the major players, you have to offer something they don't."

So Mazda returned to its roots as a marketer of fun-to-drive, stylish vehicles, and the strategy has put it back on track. Although Mazda sold 241,242 vehicles in the first 11 months of 2002, a 3.7% decline from the same period a year ago, according to Automotive News, Mr. Hughes predicted he would sell 10% more vehicles in calendar 2003 than 2002. In 2001, Mazda sold 269,602 units.

Following intense consumer research that started in 1998, Mazda now aims at the 25% of all buyers who consider themselves auto enthusiasts. "They're not all car nuts. Some like the technology," Mr. Hughes said. Not only does the target account for some 4 million-plus units annually, those buyers are willing to spend more on their cars.

`zoom zoom'

Mazda, in which Ford Motor Co. holds a controlling interest, has been laying the groundwork for its new positioning since June 2000, when it introduced the "Zoom Zoom" theme in brand ads from independent Doner, Southfield, Mich.

Mr. Hughes, who has worked on 11 different auto brands in his career, said he'll increase his 2003 ad budget to back three product launches. Mazda will also beef up its print advertising from roughly 5% of its total budget to some 12%. The marketer hasn't been a big player in magazine advertising, spending just $600,000 in the first three quarters of 2002, according to Taylor Nelson Sofres' CMR. Mazda spent a total of $141 million in measured media during that period, according to CMR.

Launch ads for the Mazda6 sedan broke recently from Doner. The car, which replaces the 626 and Millenia as the brand's flagship, will get sustained ad support for 12 months, he said. The Mazda6 line is expected to get more than $100 million in spending during that time.

"Nissan is a department store. Mazda is a boutique," said Jim Sanfilippo, exec VP of AMCI, an Omnicom Group auto consultant. He said Mazda has a lot in place, including upcoming products and Mr. Hughes, due to his extensive experience "knows what he's got and what to do with it."

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