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Automotive Industry

Hogan, E-Gm, Aim To Speed Order-To-Delivery - Brief Article

Automotive Industries, Sept, 2000

You won't see Mark Hogan using his cell phone while driving anymore. The President of e-GM, the General Motors unit responsible for connecting customers to the automaker's products and services via the Internet, recently had his own car fitted with "Personal Call," a new OnStar feature with voice recognition, and he's proud to say he's one of the first to use it.

If any GM executive needs the latest telematics technology, it's Hogan. Since launching e-GM one year ago, he's been running at light-speed -- making online alliances, expanding OnStar's subscriber base, listening to dealers about the Web, and experimenting with new vehicle sales channels like retailcom. Recently we caught up with him at his office in Detroit; an exerpt from that interview follows.

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Q: At what point does e-GM accept the same responsibility, as marketing and advertising have traditionally done, in taking the credit -- or the criticism -- for GM'S sales and market share?

A: It's hard to tell where the challenges are, from a market share standpoint Basically, we're up (in share) in all our core segments. The only place we're losing share right now is in the low end of the market. For better or worse, we made some product decisions several years ago to keep riding the same horses, so to speak.

If you look at GM'S market share, we've gained in SUVs, pickups and midsize vehicles. I think the market share question tends to get broadly generalized and really isn't fair, at this point.

In a sense, the customer's voting. The Koreans and Europeans have had an impact. What's e-GM going to do about that? We know we need to be more competitive, particularly with entry-level vehicles and younger buyers. We're going to be working the Web really strongly. We've now got alliances with College-club and ClubMom (affinity group dot-coms). We can do a lot more pinpointing on the Web.

But only time will tell. The days of the broadbased national ad campaigns, and spending a lot of money, are going to give way to more personalized, one-on-one marketing.

Q: What tools does a-GM have help the company when it launches a new vehicle that doesn't exactly click with the public right away -- for example, the Pontiac Aztek?

A: We know from the aspiration and intention standpoints who Aztek appeals to and who it doesn't. We can be very laser-like in finding those customers and pointing our information to them, on-line -- assuming they opt in. Oh, and by the way, for years we specialized in designing and building vehicles that are middle of the road and average. So we come out with a vehicle (Aztek) that's distinctive and we get batted around on that, too (laughs).

We won't have any trouble selling Aztek, and we'll use the Internet to do that.

Q: Some industry observers claim that Honda and Toyota have had more success in selling vehicles through the Net than other OEMs, because of the way they configure the vehicles for sale -- option packages, etc. Is there a lesson for GM there?

A: Let me challenge that claim. Honda and Toyota aren't any more successful online than any other manufacturer. If you look at the numbers, it would probably suggest the opposite. Toyota is more aggressive than even Honda in promoting their products online. Their manufacturing systems try to take variation out of the plant, so they do a much better job in packaging options. We're also driving variation out of the production process and we're now offering configuration online that brings popular option packages together much like Honda does with Civic and Accord, or Toyota with Corolla and Camry.

It's a sense-and-respond approach. As we lay out our Order-to-Delivery system, and I work closely with Harold Kutner (GM purchasing chief) on this, we're definitely shortening lead times into and outbound from the plants. We're building a sense-and-respond model where the customer tells us what they want, and when we sense that, and sense changing trends, we'll be able to react to it much more quickly. e-GM will help make it happen.

Automotive Industry

Hogan, E-Gm, Aim To Speed Order-To-Delivery - Brief Article

Automotive Industries, Sept, 2000

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