Entirely Comfortable with Its Orientation: Subaru’s Successful History of Gay/Lesbian Integrated Marketing Communications

“Companies can’t just throw one ad at gay consumers and think they’re done.” – Mike Wilke, Founder and former Executive Director of Commercial Closet Association

Roadmap The U.S. Automotive Industry Brief History of Gay & Lesbian Marketing Subaru Company Overview Gay & Lesbian IMC Efforts Recognition Ford Gay-Friendly History AFA Boycott Comparing Subaru and Ford Current Dilemma Questions

The U.S. Automotive Industry 40+ automotive makers in the U.S. Current turmoil: economic recession increased oil prices poor management Chrysler and GM file for bankruptcy in 2009 U.S. sales breakdown: Japanese auto manufacturers = 47.5% American manufacturers = 34.8% Foreign imports (primarily European) = 17.7% Industry leads all in ad spending allocated $10.1 billion to advertising in 2008

Brief History of Gay/Lesbian Mktg Ad spending in gay media more than tripled between 1994 and 2007 ($53 million to $182 million) Companies across several industries market to gays/lesbians, yet few total companies overall IKEA (1994), AT&T (1994), Mazda (1994), and John Hancock (2000) receive conservative backlash for their ads Gay automotive advertisements: Saab first to advertise to gays/lesbians in 1994 Saturn second  1995 Subaru third  1996 VW fourth  1997

Subaru: Company Overview 1917: Nakajima Aircraft Co., Ltd. founded 1953: Fuji Heavy Industries (FHI) created 1958: Subaru of Japan founded 1968: Subaru of America founded

Subaru: Company Overview Subaru today: Headquartered in Cherry Hill, NJ Led by Yoshio Hasunuma: Chairman, President, & CEO 600 dealerships nationwide 2008: Sold 192,760 cars 2008: 2.2% of U.S. market share 2008: Spent $195 million on advertising Toyota owns an 8.7% stake in FHI

Subaru: Overview (Sales Figures)

Subaru: Gay/Lesbian IMC Efforts 1994: Research shows lesbians are key consumer base 1995: Founding sponsor of Rainbow Card 1996: began advertising in gay media “Entirely comfortable with its orientation.” “It’s not a choice. It’s the way we’re built.” “Get out and stay out.” “Different Drivers. Different Roads. One Car.”

Subaru: Gay/Lesbian IMC Efforts 1996 - today: sponsors gay/lesbian events nationwide 2004 - 2009: Brand integration on The L Word 2004 - 2006: founding sponsor of Sirius OutQ 2005 - today: founding sponsor of Logo; current Logo Legacy Campaign using brand interstitials

Subaru: Gay/Lesbian IMC Efforts “Look, we know that our owner base and our consumers are extremely well educated, and they celebrate diversity. A person who would be offended by our advertising probably would not have bought our car anyway.” - Tim Bennett, former Director of Marketing for Subaru 08/17/2001

Subaru: Recognition 2002 – today: HRC CEI ranking 2005: Bennett wins Visionary Executive Award from Commercial Closet Association 2008: MediaPost’s Automotive Marketer of the Year 2009: GLAAD’s Corporate Responsibility Award

Ford: Company Overview 2008: Net income of $14.7 billion 2008: Sold 2.3 million automobiles in North America alone 2008: 14.2% of all U.S. Auto sales 2008: 6th largest U.S. advertiser ($1.4 billion) One of the Big 3 American auto manufacturers Only one of Big Three to not receive bailout money in 2008

Ford: Gay-Friendly History 1995: GLOBE founded 1996: GLOBE develops intranet site 1999: Jaguar sponsors GLAAD Media Awards 2000 – today: Ford sponsors numerous gay/lesbian events 2001: Volvo starts advertising in gay media 2002: Land Rover starts advertising 2003: Jaguar starts advertising

Ford: Recognition 2000: HRC Corporate Equality Award 2002 – today: HRC CEI ranking 2004 and 2005: only automotive company to score perfect 100 2003: Diversity, Inc. names Ford #1 for diversity, second best for LGBT employees

Ford: AFA Boycott 05/31/2005: AFA announces boycott 06/2005: Ford meets with AFA for first time 11/28/2005: Ford meets with AFA for second time; announces it’s pulling future Jaguar and Land Rover ads 11/30/2005: AFA calls off boycott

Ford: AFA Boycott 12/07/2005: “That is not something that came about in the last week or month. It’s been evolving a long time. This was made as a pure business decision, not as a social statement one way or another. This was not a decision in response to the American Family Association. Jaguar and Land Rover are streamlining their advertising in 2006.” - Mike Moran, Ford Spokesman

Ford: AFA Boycott 12/10/2005: Ford agrees to meeting with gay stakeholders 12/12/2005: Ford announces intent to run corporate ad for all 8 brands in gay media 12/15/2005: Rev. Wildmon drafts letter to Chairman Bill Ford 03/13/2006: Boycott reinstated 03/10/2008: Boycott ceases

Comparing Subaru & Ford Japanese vs. American auto manufacturers Size Sales figures Target markets Ad budgets

Current Dilemma Subaru needs to: retain its competitive advantage using public relations strategies as competition increases keep diversifying its IMC efforts in years to come, especially if new gay media outlets are not available for sponsorship continue to grow its consumer base without damaging current stakeholder relationships

Questions As competition increases, how can Subaru retain its competitive advantage through corporate communication efforts, particularly to reach gay and lesbian consumers who are unaware of their previous efforts? Is Subaru’s IMC strategy for reaching gay men and lesbians sustainable? Why/why not? How can Subaru diversify its IMC efforts in years to come?

Questions What other niche markets can Subaru pursue that would not alienate its current consumer base? Should Subaru’s initial reluctance to discuss its gay and lesbian marketing efforts be viewed as simply a protection of business intelligence from competitors? Could their strategy be interpreted differently by various stakeholders?

Questions Should Ford’s Mike Moran and others have handled the company’s initial statements and media questions differently? If yes, how? Consider Moran’s comment that in 2005, Ford had considered pulling its Land Rover and Jaguar ads for 18 months. The companies just started advertising in 2002 and 2003, respectively, which left little time to measure the ads’ impact. Should Moran have elaborated on Land Rover and Jaguar’s plans to pull ads from other media outlets so as to not give the impression that the pull was unique to gay media?

Questions What can Subaru (and other companies) learn from Ford’s handling of the AFA boycott? Based on the experiences of Subaru and Ford, if companies decide to advertise to gay and lesbian consumers, when should they do so? Is advertising to the communities’ alone enough? What sort of IMC strategy should be in place?