Upclose America #197 # 197/ February 17, 2023 (Fri) / Confidential |
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Hello subscribers, Happy Friday!
Tesla has been following Henry Ford’s strategy with the Model T–come out with a superior car, don’t make major styling changes, and just keep improving the product. That has worked great, but Tesla started facing some serious competition, especially in China, where sales of the Model 3 fell 17% last year. Tesla cut prices last month and that brought in a bunch of orders, but sales are starting to flatten out again this month. Tesla (unofficially) announced a design change for the Model 3. Although the Model 3 sells well in the United States due to various discount benefits, its sales have fallen by 17% in China. Tesla, which did not make any styling changes except for the nose of the Model S in 2016, is expected to make dramatic improvements in exterior design.
It's become quite typical to see Teslas on the roads of California, and I personally know at least 7 people who have recently bought one. I frequently inquire about their experiences with the new car, and here's what I've learned.
Luxury car owners who are used to similarly-priced gasoline vehicles are often dissatisfied with the interior quality of Tesla's minimalist design. They reported finding large gaps between parts, poor fit and finish, and, especially for the Model 3, excessive road noise at high frequencies that can cause fatigue after driving just 60 miles. Additionally, the ride can be bouncy, with the road surface being transmitted throughout the body.
In addition, they discovered that Tesla lacks some convenient features that are common in other cars, such as a garage remote like Home Link, which requires a separate installation costing $325. However, they were pleased to find that it could be set up to operate automatically based on GPS location. They also noted the absence of blind spot detection and reverse obstacle warning sounds.
The small font size on the speedometer can be inconvenient and reduce visibility. Other issues include poor image quality from the dash cam (with expectations of 4K), a voice recognition interface that can be frustrating, and a hood that is sensitive and must be pressed until it clicks (and may bend if made of aluminum). Furthermore, the absence of CarPlay/Android Auto means users must search for a destination on their phone and then share it with the Tesla app, which can be time-consuming. Some individuals have even criticized the rain sensor method, which is not used, and the camera capture method, which does not work well in areas like California where water splashing from surrounding cars is not captured, leading to poor system performance. Lastly, married couples may find it challenging to unwillingly share their current location to their spouse.
Despite the aforementioned issues, majority of the Tesla owners reported huge satisfaction when they view their cars as smart device rather than typical automobiles. They appreciate the benefits of frequent over-the-air (OTA) software updates, a well-organized user experience (UX), particularly the Autopilot system, which makes long-distance or near-city driving much more comfortable, outstanding speaker sound quality, and low maintenance costs, which can outweigh most of the drawbacks.
Recently, Tesla's $20,000 discount has helped to lower the price barrier, and I look forward to seeing how the design change will impact Tesla sales in U.S. |
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😉 Newsletter Summary
1. Consumer trend #1 - Google Map changed for EV drivers
2. Consumer trend #2 - This year's super bowl changed
- Brand Nudge
- Sidestepping the main event
3. US Automotive news this week
- Extensive use of puddle lamp
- U.S. Using 6% Less Gasoline a Day - WFH, Efficient car, EV expansion
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Google Maps targets range anxiety with smart new features for EV drivers
Google Maps recently launched new features aimed at making it easier for electric vehicle (EV) drivers to address common concerns such as range anxiety and locating charging stations. One feature will suggest optimal charging stops for shorter trips based on factors such as traffic, current battery levels, and expected energy consumption, making it easier for drivers to plan their routes and avoid running out of charge. Additionally, suggested charging stations can be swapped for others with just a few taps.
Another new feature is a filter for "very fast" charging stations with chargers of 150 kW or higher, allowing drivers to refuel and get back on the road in under 40 minutes. Lastly, Google Maps will display EV charging stations in search results, making it easier for drivers to find charging stations at popular destinations like supermarkets and include charging while running errands. These new features are available to drivers of vehicles with Google built-in.
The switch to EVs offers numerous opportunities for developing innovative products and services that can generate profits while also benefiting the environment, such as hotel booking platforms for EV drivers and upcycling of worn-out batteries.
💡 As the EV ecosystem continues to evolve, how can Kia get involved? |
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Super Bowl Game's changing
It is commonly said that to stay current with US trends, one must observe the Super Bowl game. This year's event drew over 130.6 million viewers in the US alone, making it the second most-watched game in history. With such a massive audience, the advertising impact is enormous, with 30-second ad rates reaching up to $7 million (89 billion won) in the world's largest sporting event.
This year's ads aimed to create a joyful and positive atmosphere by incorporating nostalgic music, perhaps in response to economic uncertainty stemming from the Ukrainian conflict and inflation. This differs from last year when humorous and lighthearted ads took center stage. |
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Brand Nudge
Several brands utilized ad-driven brand nudges to redirect consumers' attention towards important topics and encourage them to adopt positive habits. |
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Heineken with no alcohol beer
Heineken's 60-second ad during the first half of the game promoted Marvel's Ant-Man and the Wasp: Quantomania and focused on alcohol-free lifestyles. In the ad, actor Paul Rudd was seen grabbing a non-alcoholic Heineken 0.0 to have a "clear head" before embarking on his mission to save the world. The campaign emphasized the rising popularity of low- and no-alcohol options and encouraged consumers to try alcohol-free beer. |
Hellmann’s
Hellmann's, the condiment company, made its third consecutive appearance in the Super Bowl with its Make Taste, Not Waste campaign aimed at reducing food waste. The commercial called "Who's in the Fridge" featured actors Brie Larson and Jon Hamm, seemingly trapped inside comedian Pete Davidson's fridge. After assessing the available ingredients, Davidson uses Larson and Hamm's characters to make a ham and cheese panini. |
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Sidestepping the main event
On top of spending an average of around $7 million to secure an in-game commercial slot, advertisers also have to pay millions of dollars to produce the ad itself. In a time of economic difficulty, many advertisers were faced with the decision of whether or not to invest in a Super Bowl ad.
In 2023, major auto manufacturers like Toyota, BMW, and Nissan chose not to advertise during the Super Bowl. However, the brewing company Anheuser-Busch still promoted its brands, Bud Light and Michelob Ultra, despite ending its 33-year exclusive advertising partnership with the NFL for the Super Bowl.
TikTok became the go-to platform for many brands. State Farm, an insurance company, collaborated with Khaby Lame, a TikTok content creator, to release a social media-focused advertisement using the hashtag #StateFarmStadium. The campaign encouraged viewers to estimate how many times State Farm Stadium was referenced during the Super Bowl broadcast on FOX. To encourage active audience participation, This marketing strategy highlights a shift from traditional, passive television advertising to an approach that engages the audience and encourages participation. Doritos initiated a TikTok initiative that urged enthusiasts to showcase their top-notch "triangle-themed dance" by January 11. The campaign encouraged viewers to peruse TikTok dancers' moves and subsequently upload their own dance using the hashtag #DoritosTriangleTryout, which has amassed an impressive 13 billion views.
Side note: P.S.) What's interesting is that during the Super Bowl, GM, Dodge, Ram, and Jeep, who aired electric vehicle ads, saw a surge in Google searches for Tesla instead. It has been found that savvy consumers compared the advertised products to Tesla models in terms of performance, driving range, safety rating, and other factors, without searching for the advertised product itself.. |
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Dogfish Head Brewing opted for a regional media buy in select markets to overcome this year's steep ad costs |
Indiana Farm Bureau Insurance also leaned into regional ads, aired in the state of Indiana, with a focus on the greater Indianapolis area |
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Extensive use of puddle lamp
Puddle lamps that showcase a vehicle's logo on the ground are gaining popularity. However, Plastic Omnium, the supplier, has taken light projection to the next level with their technology that uses micro lens array. It boasts multiple features, such as projecting a red stop sign onto the pavement behind the car when it comes to a halt and displaying a green signal for pedestrians to cross safely.
Moreover, when the vehicle approaches a turn, the turn signals are projected onto the pavement for better situational awareness. The technology even extends to the headlights by connecting them to the car's GPS, enabling them to predict upcoming turns and pivot towards the car's destination before it makes a turn. The system can also display a deer image to warn drivers when approaching a deer crossing or a snowflake to indicate icy conditions. Plastic Omnium's impressive technology earned them an Innovation Award at CES last month. |
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U.S. Using 6% Less Gasoline a Day - WFH, Efficient car, EV expansion
It appears that electric vehicles are having a significant impact on gasoline consumption in the US, leading to a reduction in demand that is not expected to return to pre-pandemic levels. The Energy Information Administration reports that the country used 8.78 million barrels of gasoline per day in the previous year, representing a 6% decrease from the pre-COVID level. The EIA anticipates that gas consumption will continue to drop in the current year and the next.
The drop in demand can be attributed to various factors, such as Americans driving about 10% less than before due to remote work and hybrid schedules, and ICE vehicles being more fuel-efficient. However, the primary reason is the rising number of people purchasing electric vehicles. |
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Following are insights received on Toyota's Grand Highlander:
- Overall, it feels rough and stiff (Engineer)
- Feels like a larger Rav4 (Engineer)
- The design is boring, but it will probably sell well in the US (Designer)
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Kia Design Center America
created by Jenna Chwee
jchwee@hatci.com
101 Peters Canyon Rd. Irvine, CA 92606
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