Conflict with regionally aligned clients and tight pitch deadlines were mentioned as the reasons for pulling out of the current review. But others pointed to a tough brief where agencies were given only three weeks to devise a plan to boost exports of the Proton brand to international markets, such as the Middle East, India, Indonesia and Thailand. All this in addition to overhauling its flagging domestic brand.
The US$6.1 million advertising account has changed hands twice in the past two years. TBWA first scooped the account from M&C Saatchi in 2006 before McCann took over last year. The latest review sees all three now back in the fold, although one source notes that Proton’s problems stretch beyond branding and positioning.
The carmaker’s woes in its local market are further exacerbated by rising fuel costs, due to lowered Government subsidies and increasing competition from Japanese imports such as Toyota and Honda and local rival, Perodua. These have put pressure on the home-grown marque thanks to aggressive marketing.
Proton saw its sales fall to its lowest point last year as it suffered a 55 per cent drop in business, posting consecutive quarterly losses to register a $169 million deficit by December.
Since then, the Government-linked company has moved back into the black with $63 million in net profit for the year ended 31 March. However, the recovery was only made possible through the injection of Government funds.
The country’s investment arm, Khazanah Nasional, which holds a 43 per cent stake in Proton, has admitted that the national carmaker needs to form an equity partnership with a foreign car firm in the next five years to remain competitive. Last year, talks with Volkswagen and General Motors broke down when the Government cooled on the idea of foreigners taking control of the sedan.
Martin Roll, CEO, VentureRepublic
Global marketers know that stressing the origin of their country can help sales.
Look at German cars and French wines.
A product’s country of origin acts as a proxy for judging the quality of the product.
This is the core issue of Proton’s struggle to create an internationally recognised car brand amid competition from Korea, Japan and Germany. What does a Malaysian car brand mean to global citizens?
Proton needs to audit its top management team and assess whether C-level executives have the experience, skills and resources to build a global brand.
The brand needs to redefine itself and Proton must avoid national pride and arrogance as key reasons for the brand purpose - a brand is based on merits.
Less than 15 years ago, the Korea brand hardly meant anything to global citizens. Today it’s one of the leading global technology-driven countries. The time has come for Malaysian companies to prove to the world that they can bring about leading technology brands and surprise the world in the same way the Japanese and Koreans did.
This will become the most important issue for Malaysia over the next 10 years - and Proton, with its global ambitions, is at the forefront.
SP Lee, MD/ECD, Dentsu, Malaysia
The press has long pilloried Proton. Despite its nifty cars, quality has been inconsistent. And the Malaysian firm’s multiple marriages, first with Mitsubishi and then with Volkswagen, have ended in tears.
Worldwide, only a dozen countries produce cars, and half of them are struggling. Why does Malaysia, with no equity of technology, want to go into the car business?
Critics are quick to ask how it is that Malaysia’s second car, Perodua, is doing well. Perodua has clear positioning as the smart, small car, sound management and vision and a world-class technology partner in Toyota. In contrast, Proton has had many partners, management fallouts and a confusing line-up of products.
This is its brand image. The lack of a clear vision within any company will show up in its products and in the press, and this is what consumers take away.
Jeff Immelt, CEO of GE, said to be global, you need more than global products and sales. You need global minds in the company. Proton should quit being hung up about being ‘made in Malaysia’. Misplaced nationalistic pride gets you nowhere. Proton is up against the world. To win, it needs to engage the best minds in the world.