Case Analysis: Renewing the Nissan Brand

Background
Nissan was the first company to launch automobile production in Japan and
begin exports to the USA. With successes of modes like the 240Z and Datsun
Sedan it was a huge success in the US market in the 60s and 70s. However,
after the arrival of Toyota and Honda, it lost its dominant position in the US and
fell to the number 3 position behind those 2 as far as Japanese car makers were
concerned. The decline was so substantial that by the end of the 20th century
the company was facing near bankruptcy and was an object of ridicule in the
automotive industry of North America.

Causes of the Decline

It lost its original identity of a car maker that focused primarily on car
performance and tried to be like the efficient cars being made by Toyota
and Honda.
The brand image of Nissan had lost its standing and it was seen as a
follower brand or me too offering.
Because they were at the number 3 position behind Toyota and Honda,
they had started concentrating on dealer schemes, discounts and sales
promotions to increase car sales and meet targets, whereas their
competitors were commanding a premium and were operating at much
higher operating margins.
The low operating margins of 1.5% by the end of the 90s ensured that
Nissan was losing money on every car it sold and therefore they had to
take huge debts to keep up their operations.
Their positioning strategy had no clear vision to it, and they tried to
appease everyone, while blindly copying the competitors.
Their organisational structure led to a fragmented approach, where there
was no cohesion between the various departments like production,
design, marketing, sales etc.
No internal branding cohesion to create a corporate brand.
No though out branding strategy or personality.

The Turning Point

The turning point in Nissans fortunes was when, Renault decided to buy a stake
in it and invest $5 Billion into the company. It also decided to bring in Carlos
Ghosn as CEO. He undertook a major restructuring of the company and
communicated clear goals to be achieved in aggressive timelines. He also
brought the focus back to marketing their brand the right way to ensure long
term success rather than focusing on short term sales targets. North America
was run independently of Japan, to allow Nissan NA to create its own corporate

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brand image that could be strengthen and later leveraged to allow them to
launch the premium infinity brand of cars later.

Steps Taken:

Public commitment to clear goals and a deadline of 2 years, beyond which

the top management would be in serious trouble.
Setting up of the Nissan Revival Plan to restore profitability:
o Targeting operating margins of 4.5%, revised to 8%.
o Zero Debt
o Sell an extra 1 million cars
Revival of the Nissan culture among employees through:
o Timeline of the success of the Nissan brand on a 10 feet wall
o Work environment resembling a hard rock caf
o Setting up cross functional teams to rekindle the innovative spirit
that Nissan was traditionally famous for.
o Allowing senior management people to take the lead role in the
cross functional teams
o Allowing middle management to take up innovation so that the
companys growth was middle led.
o Free the designers to allow them to realise the brands potential.
Developing products that were a first in the market, rather than following
other car makers.
Focus on addressing the unmet needs of the customers.
A clear brand positioning set to target a niche segment for every model,
rather than trying to target everyone.
A brand personality that focused on 7 key words that were used to create
the brand association for Nissan.
A clear a well-defined branding campaign built around the word SHIFT,
that allowed it to have a flexible marketing campaign for different cars,
while keeping a core corporate brand idea constant, much like Nikes Just
do It campaign.
It built brand loyalty among its customers, which had not been common in
the American automobile industry earlier.
A proper brand scorecard to assess the success of its branding campaigns
in financial terms.
New and premium looking dealerships.
Developing a sustainable competitive advantage for Nissan.

Conclusion
Thus we can see that having a coherent branding strategy with a clear, vision,
purpose and association in mind is a major factor that contributed in the revival
of Nissan in USA and the success of various models like Xterra & Altima. It
allowed them to create a brand image that took them to the top of the US
automobile industry in terms of operating margins, allowed them to win a car of
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the year award, soon after revival and also use it as a base to launch the
premium brand, Infinity, to compete with the likes of Lexus.

Group 6: Adil Bains B14004 | Aiman Faraz- B14005 | Nikita Midha B14035