How Fiat Chrysler reset the compass for iconic Jeep brand in India

Premium lane: With prices starting from Rs1.6 million to Rs 2.1 million the Compass competes with the Mahindra XUV500 (Rs 1.3 million to Rs 1.4 million) and Tata Hexa (Rs 1.2 million to Rs 1.7 million) among others. All prices are ex-showroom, Delhi
Two years ago when Fiat Chrysler Automobile (FCA) was mapping out the Indian journey for its iconic Jeep brand, it found itself up against a rather unusual challenge: the brand was so well known that it needed no introduction, but the identity embedded in the Indian consumers’ mind was nowhere near the one that the auto major wanted to reinforce in the country. So deep was the association of Jeep with a rugged, boxy all-terrain vehicle that FCA found it nearly impossible to press down on the accelerator for its new models and extensions that were higher priced and differently packaged. Until it found a way to live down its legacy and step away from the generic Jeep label. 

 “One of the challenges for us was—how do we reclaim the name—it was ours, it wasn’t a generic name,” said Kevin Flynn, president and managing director of India operations at FCA.    

It’s not very often that high brand recall is a challenge and not an advantage. So how did FCA overcome the challenge? Besides crafting a media marketing strategy around “luxury with capability” that could get the messaging right, FCA opted for what it calls a “top-down” approach with regards to product positioning. 

FCA entered the market with the high-end Wrangler Unlimited and Cherokee and then waited several months before it brought in the lower-priced variants. The strategy has paid off.  The Jeep Compass—a made-in-India premium sports utility vehicle launched in August 2017 has been averaging 2,500 units a month in India’s crowded SUV market. 

 
“What they thought was a Jeep wasn’t a Jeep,” said Flynn. While Flynn didn’t actually think it was a disadvantage, he knew that it could have killed the brand if he had left the perception problem unattended. He had to reposition Jeep. It was no longer a utilitarian vehicle meant for difficult terrains but a premium, sports utility vehicle targeted at young, upwardly mobile city dwellers “As we started from the top, it was an easy fix and association was easy. Now we can go to the bottom of the value chain,” said Flynn alluding to the top-down approach.

Flynn and his team chose Auto Expo 2016 as a platform to take the wraps off the India-bound Wrangler Unlimited and Cherokee marking the official entry of the 76-year old American SUV brands, best known for its off-roading capabilities.  A premium price tag and an imported route adopted for the model meant that FCA was willing to eschew volumes to build its premium identity. More than anything else, it was to make a statement, to demonstrate what the Jeep brand was all about and lay the foundation for models in the mass segment.  

 
“We had to ensure that the marketplace really understood the change,” said Flynn adding that FCA chose to bring a completely built unit (fully imported) car when the market for it was actually on a decline. “It was imperative to make the vehicle available to establish where Jeep as a brand sits,” he added. But that was not all. 

The whole reason for doing what FCA did was to prepare the ground for the Compass, a made-in-India SUV. Flynn believes that the strategy has worked and that the brand has been able to cut through the price barriers that are otherwise quite rigidly entrenched in the auto industry. “We have got buyers who owned vehicles that were cheaper than Jeep, we have got people from other segments—multi-purpose vehicle, bigger SUVs,” he pointed out.

Besides the product strategy, the print, digital and outdoor campaign to reinforce the key messaging “luxury with capability” which underpins Jeep’s communication strategy globally also helped build a differentiated positioning for the brand. 

But FCA cannot afford to rest on its early success with the Compass brand, said experts. It needs to quickly launch another model before the high brand recall created fizzles out, said Rajeev Pratap Singh, partner at Deloitte Touche Tohmtasu India. “They got their product strategy and price positioning right and hit the sweet spot with the Compass.  The launch of another model from the Jeep brand within a year to year-and-half will have a positive rub off from the Compass,” he said. 

Flynn refused to comment on product plans. “I can only say, we have big and exciting plans,” he said. According to people aware of company’s plans, FCA is planning to introduce the Trailhawk—a 'top of the line' variant of the Compass range.

 In automobiles, more than any other product category, besides a good product, brand visibility through customer touch points is an important determinant in its success. FCA which currently has only 65 sales outlets and plans to add another 10 by year-end still has some ground to cover in this aspect. Even with the premium positioning it has in the market, FCA needs at least 250 to 300 sales outlets to be visible in a segment where touch and feel continues to be critical for the buyers. Buyers want to see what their money can buy.