Its solution? Send in the clowns. Or, at least, send in the kung-fu puppets.
Scion announced this week that it is partnering with another scion, Francis Ford Coppola's son, the director Roman Coppola. For Scion, Mr. Coppola has produced a live-action, nine-episode puppet series called "The Fist of Oblivion" that will appear on its marketing website, Scion Broadband. In "Fist," kung-fu-fighting puppets seek to exonerate a cop who has been sent to prison for murder; new episodes will launch every Tuesday through the end of December.
"Fist of Oblivion" may be aptly titled, given the punching bag that the auto industry has become. With credit markets seizing and gas prices volatile, U.S. auto sales plummeted 32% in October to the lowest monthly level in 17 years.
To date, the Toyota sub-brand has chosen to live or die by its guerrilla marketing, forgoing broadcast TV advertising and favoring billboards, online marketing and the odd cable TV ad, begging the question: In such a yawning recession, can a struggling, neophyte marque really stick with chop-socky puppets as its brand message and hope to survive?
Adrian Si, Scion's interactive manager, said Mr. Coppola's edgy fare will "resonate with our audience and stay true to the culture of the brand."
But that, said Jesse Toprak, executive director of industry analysis for Edmunds.com, is exactly the problem.
"The fundamental issue facing Scion is that it is perceived as a niche brand, not a household name," Mr. Toprak said. "In times of economic uncertainty, we see consumers making safe choices, taking to familiar things. You'll never be questioned as to why you bought a Honda Accord or Toyota Corolla."
Alex Sanger, general manager at WhittmanHart Interactive, Los Angeles, brought Mr. Coppola and Scion together, sensing that the two had similarly avant-garde tastes and that Mr. Coppola's irreverent style could be the sort of "defining content" that would keep Scion's core customers -- young, mostly male and web-savvy -- "coming back to the Scion Broadband site again and again."
Mr. Coppola had also recently directed a string of commercials for Volkswagen that aired over the summer, wherein celebs like Heidi Klum, David Hasselhoff and Bobby Knight were interviewed by "Max the Beetle," a 1964 classic VW Bug.
But while Scion was established to tap the youth market alone, under present economic circumstances the carmaker cannot rely on that demographic to show up with cash in hand. In this lending environment, said Mr. Toprak, "those [young] consumers typically don't have the type of credit needed to get a new car."
No incentives to buy
Nor does Toyota seem willing to give any Scion buyers a lift: According to Edmunds.com, the average automotive manufacturer incentive in the U.S. was $2,648 per vehicle sold in October. By comparison, Toyota is offering Scion incentives that amount to an average of only $159 per vehicle.
"They're sticking with the one-price selling," said Mr. Toprak. "It's 'If you're interested, buy it, but we're not going to give you any other reason.'"
Art Spinella, president of automotive research firm CNW Marketing Research, said that by using Mr. Coppola's puppets, Scion "is really directing their efforts at an audience that is out of the market, currently. You can spend all sorts of money marketing edgy stuff, but the reality is that that's not converting many people to a new car acquisition, and certainly not 18- to 30-year-olds: Even as high as [age] 25, parents are controlling the purse strings now."
Moreover, Scion's early success came from many silver-haired car buyers who have now soured on the brand. Until last year, a third of all Scions sold went to buyers old enough to be Gen Y's grandparents: "The issue became the over-60 folks who bought [Scion] xB's. Scion made a car that was cheap to buy, inexpensive [to drive] and easy to operate," said Mr. Spinella, "with the unintended consequence that about a third of their market was in the over-60 group."
Worse, said Mr. Spinella, "that particular [older] audience is not enamored with the xB this year, because now the xB is not as cheap, not as tidy a package."
Headed for trouble?
This leaves Scion in a quandary: It is faced with a younger, core customer that increasingly can't afford the new Scion, and an older, incremental customer that doesn't want to pay more for it.
Said Mr. Spinella, "I am not sure they even know what to do with Scion. [The new campaign] totally ignores many of the people who've been buying Scions for the last three years."
Asked if Scion can afford to stay focused solely on youth marketing, Mr. Si answered, "It's a great question. It remains to be seen: How long is this [recession] gonna last? For the time being, we need to stick to the core, younger buyer. The call on whether we continue to stick to that is made at a level slightly higher than mine."