Despite a difficult economy for small business, savvy brands recognize the unflagging appeal of the startup. And so more of them are supporting entrepreneurs or associating themselves with the entrepreneurial spirit, ranging from PepsiCo to General Electric.
Lexus wants a piece of that action, too. The Toyota-owned luxury brand has established a contest called Lexus Ignition in which a Facebook app is soliciting votes on eight technology startups, whose four winners will split up to $100,000 in funding from Lexus US. The startups range from a maker of audio speakers out of "eco wood" to the designer of "the world's first pocket-sized video-stabilization case for a smartphone that eliminates shaky video," according to a Lexus press release. Each innovation could have some relevance to automotive technology.
Timing the social campaign, which is now in week two, to the debut of the all-new flagship sedan, the 2013 Lexus ES, the brand wants to "support other creative projects that exemplify this philosophy," Lexus CMO Brian Smith told brandchannel. The digital campaign reflects "our greater focus on multimedia and connectedness in the car," he said, echoing a key theme for automakers these days.
Lexus is focused more intensely now on "innovation and design" for its cars, Smith said. "We're also engaging more with customers. And this is an excellent way to communicate to some of them, to young entrepreneurs, that we have similar goals — we're both after innovative ideas." Young entrepreneurs such as Jamie Siminoff, whose SolarPOP portable solar-powered mobile device charger won week one of the Lexus Ignition challenge on Facebook.
In addition to supporting tech startups with its first crowdsourced funding platform, the luxury automaker is trying to foster a culture of thinking like a startup internally, Smith told us, by forming "small groups to brainstorm ideas and think like entrepreneurs. And every good idea in our car starts with a single person coming up with an idea."
Lexus executives are feeling their oats these days because the brand is on a big comeback drive in the U.S. market after lagging behind Mercedes-Benz and BMW in the US last year. Sales rose by 36 percent in September over a year earlier, as the brand finally has been able to restore supplies to their previous "normal" levels. Many loyal American Lexus customers waited out last year's supply-chain problems in their determination to stick with the brand instead of switching to another luxury make, and many of those sales are showing up this year.
Smith believes that more product offerings, such as the new ES, will lend Lexus more momentum heading into 2013. Next year, Lexus may again have the volumes to be able to compete with BMW and Mercedes-Benz for the U.S. luxury-sales crown that went to BMW last year. "We had challenges beyond our control," he commented, "but we've continued to focus on innovative ideas, both process and product, to make sure that innovation never leaves our brand. That's what 2012 is about."
The $100,000 Ignition challenge isn't the only funding Lexus is doing these days, by the way — the brand is now seeking entries for its sixth annual partnership with Scholastic for the Eco Challenge, a $500,000 fund for grants and scholarships for middle and high school students that has awarded more than $3.5 million to date.