Can Toyota fend off the wolves?

It has been nine days since the public first learned of the big recall/stop selling/cease production order from Toyota, related to problems with the accelerator on eight Toyota models. Now, much attention is being given to the resulting consumer sentiment: How fast will Toyota be able to regain credibility with consumers and rebuild trust in their brand?

Implications: In my personal opinion, four factors will influence the pace and efficiency of Toyota's brand re-building effort.

Chief among these might be the way local dealerships court and care for their current Toyota customers. If the repair is swift, and the customer feels reassured by this important touch point, Toyota’s odds for returning to “business as usual” are greatly enhanced. (This is an important lesson for any company that depends on franchisees for customer service; remember that your survival may depend on those folks in a future crisis.)

Second, Toyota’s candor in the coming weeks and months will be critical. Most consumers are pretty smart people. Level with them, and they’ll continue to listen to you. But if they find out you’re just trying to cover your… um, tracks, they’re likely to just get mad.

Third, I expect we’ll begin to hear references to “plausible deniability.” When, exactly, did Toyota begin to suspect there was a major problem with the accelerator component? Was there any delay—and if so, how long—between the time executives suspected a major problem and the time they acted on it? Did they ignore any conspicuous signs? Recent stories have been investigating that question (see this story from the New York Times). I’m not convinced yet, either way.

Factor number four: The competition, and other voices that will enter the mix. When I first heard about the recall last Tuesday night, I suggested to a colleague that it was only a matter of time before the congressional hearings would begin; what I did not expect is that they would happen almost immediately (see this story from Fox News). Sometimes, these hearings can deteriorate quickly, eroding from fact-finding events to witch-hunt. Politicians (aka “candidates”) can see a moment like this as an opportunity to create sound-bites for future campaigns. On top of this, add a list of companies that are licking their chops at the prospect of taking market share from a leading competitor. This week, Ford announced a jump of 25% in January sales, an increase that many pundits believe will correlate with Toyota’s declines.

Here's another perspective on the competitive landscape:

I did a quick Google search using the words, “Toyota” and “recall” this week. At the top of the page, the first option I was offered was a link to Toyota’s official page—a sponsored link, of course—about the recall (www.Toyota.com/recall).

Beneath that, I was offered a variety of news stories and articles in the “organic results” section of the page.

On the right margin, there were four other “paid” search results “above the fold” (the part of the screen I could see without scrolling down):
1) “May the best car win” (an ad/link for Buick),
2) “May the best car win” (an ad/link for Chevrolet),
3) “May the best car win” (an ad/link for GMC), and finally,
4) “Toyota Recall Accident?” (which was an ad for a personal injury law firm at www.ToyotaJustice.com).

In the marketing world, as in nature, the wolves don’t feel sorry for an injured deer. They are too busy trying to eat him.

Mike Anderson