The Ford Fiesta, after flopping in the U.S. in the '70s and selling well in Europe ever since, is set to go global
Within the next two years, Ford Motor (F) will be introducing a new version of its hugely successful European small car, the Fiesta, around the world. And in a decision viewed with a bit of trepidation by some executives, the vehicle will have the same name everywhere. No matter the market, the Fiesta it is.
At Ford, as well as many other companies, the name game used to be all about sussing out local tastes. Ford's marketing teams in different countries were left alone to come up with suitable names. That's how Ford ended up selling two entirely different vehicles in America and Europe that are both called Fusion. When information wasn't so readily available online, that might not have been a problem. These days it definitely is. For example, pictures of the vehicles—one is a sedan, the other a sport-utility vehicle—get mixed up on Web sites, where 80% of car buyers begin their research. Reviews of the two are sometimes interchanged. Consumers can get confused.
But a single name for a single worldwide product makes sense in other ways. The company needs just one logo for ads, one set of nameplates for products; and online content and film for TV commercials can be shared. Branding experts say using one name can save a business tens of millions of dollars a year in marketing costs.
But finding the right name can be challenging. The wrong ones can carry unintended meanings, convey unwanted images, or just be hard to pronounce. Volkswagen (VLKAY) has pushed a global naming strategy for decades and at times has come up with controversial names as a result. There was the Bora, which is also the wind that blows north by northeast across the Adriatic Sea. After complaints from dealers that Bora sounded "boring," VW eventually renamed the car the Jetta (as in Jet Stream) in the U.S. More recently, the automaker came out with the Touareg, which is also a nomadic African tribe that used to follow a certain wind pattern. A few critics have since pointed out the tribe owned slaves, but the slow-selling Touareg is still on the market.
When it came to thinking about how to market the Fiesta, Ford executives were not all of one mind. The company has sold about 12 million of the cars in Europe, Asia, and Latin America over the past three decades. When Ford introduced the Fiesta in the U.S. in the late '70s, though, the car was so unpopular it was pulled from the lineup after two years. Recently, some of those questioned in focus groups said "Fiesta" sounded cheap. A few executives also argued that it wouldn't come across as hip next to competitors like the Versa and the Fit. They preferred the name the car was given for the auto shows: Verve.
CEO Alan R. Mulally and James D. Farley, the head of marketing, had the last word. They heard the dissent, but still decided Fiesta made sense. "It's crazy to walk away from the enormous equity in our names," says Mulally. Last year he revived "Taurus" only months after the previous regime killed it.
Ford executives figure they have time to create a fresh image for the updated Fiesta, which will be launched in Europe this fall and in the U.S. in 2010. "We'll use the Fiesta success and heritage in Europe to tell the story of Ford importing its small-car expertise to meet demands for more fuel-efficient, sporty cars in the U.S.," says company spokesman Jim Cain. Still, it could be awkward for a while, predicts Allyson Stewart-Allen, director of International Marketing Partners, a London consulting firm. But if the performance of the new small car is impressive enough, "Ford can create a winner," she says. As for those who thought Fiesta sounded cheap, in one way it will be: Its price will be about $14,000.