Love may be what makes a Subaru a Subaru, but Tom Doll is what makes Subaru hum. The former accountant rose through the ranks of Subaru of America and, in his three years as the Japanese automaker’s US president and chief operating officer, has helped lead the brand to new pinnacles of sales and brand equity each year.
With sales of 573,000 vehicles in the US last year—about 60 percent of Fuji Heavy Industries’ worldwide total sales of Subaru vehicles—Doll’s operation has turned in six straight years of compound average sales growth of 17.6 percent. And while the 2015 sales increase was only 5 percent or so over 2014, that wasn’t from lack of American consumer interest in buying a Subaru—it reflected constraints in the company’s ability to turn out its popular SUVs and crossovers fast enough.
Subaru is what Japanese call the Pleiades cluster. The car's logo evokes its six brightest stars. pic.twitter.com/bisozxqW2O
— Neil deGrasse Tyson (@neiltyson) April 29, 2016
The company is addressing supply issues by expanding its plant in Indiana, while Doll—who is No. 2 in the US to Subaru of America Chairman and CEO Tomomi Nakamura—keeps his hand firmly on the brand tiller. And Subaru continues to shine there, burnishing what has become one of the most distinctive brands in the American auto industry, retaining its thousands of loyal customers and attracting new ones as the US market tilts favorably toward the segments where Subaru excels.
“We’re no longer just attracting those loyalists who came to us for all-wheel drive,” Doll told brandchannel. “We’ve crossed from being a niche brand to a mainstream brand.”
And an interesting one at that. Subaru has continued to cater to the crunchy crowd with, for instance, its recent TV ad in which an former-hippie grandmother and her family hug a tree at Woodstock, and with its new partnership to reduce waste at America’s national parks.
It’s also recruiting talent with the Subaru University automotive school program.
— Subaru (@subaru_usa) April 29, 2016
brandchannel discussed keeping Subaru on track with Doll, who was named Motor Trend 2016 Person of the Year and also named Automotive Marketer of the Year Award for 2015.
bc: How do you balance production constraints with the need to keep telling the Subaru brand story?
Tom Doll: We discuss achieving the right balance between short-term results driven by profitability and longer-term results necessary to grow the business, and in such a way as to keep the Subaru mystique high in the minds of customers. What’s the right level of investment necessary to do that? We also need to help our retailers with investments that they have to make to adjust to this level of growth.
bc: So do you compete more on a product basis now or a brand basis?
Doll: If we have to compete like everybody else in the segments we’re in, we’re going to get our teeth kicked in because we’re still the smallest. It’s just that in certain segments, such as crossovers, we’re kind of getting more mainstream because of the volumes we’re achieving.
So the way we approach the market has to be a little different from our competitors. They’re trying to sell significantly higher volumes than we are; we can’t go down to the same transaction-price levels they can with low lease payment or zero-percent financing. We have to create value for customers in different ways, including all-wheel drive, and our legendary safety, reliability and durability.
bc: Do you worry about automatically ceding half of the American market who might be turned off when watching the “Woodstock” ad, even though it’s tongue in cheek?
Doll: Do I need half the market? No. Yes, I know some people cringe. But I’m not sure I want to get into our philosophy except to say that our customers kind of led us to this. And it’s really a reflection of where we believe we want to make an impact on the general society.
Our customers have been identified as granola crunchers and tree huggers and people with lots of stickers on the back of their cars—and we’re proud of that. Why run away from that? People who are critical of that wish [their brands] could be like that. That’s also why we show lots of dogs and cats in our ads.
bc: Subaru has been pretty quiet about electrification. Given that your vehicle fleet has to meet the same, stiff new emissions and mileage standards as everyone else, what’s your strategy?
Doll: The 2018 model year is when everything starts to converge, and we’re making plans to introduce the types of vehicles that will enable us to stay in compliance. We also get pressure from our customers on this, because there’s an expectation from our owner base that we are going to be not only bringing these products out but be a leader. However, being a small manufacturer—and we’re not using this as an excuse—the cost of developing these products is quite significant. And in the marketplace right now, it’s not like [EVs] are flying off the shelves. Everybody is still kind of struggling with it.
bc: On the other hand, when it comes to automated driving, Subaru, with your Eyesight system of features including pre-collision braking, lane-departure warning and adaptive cruise control, is at least in the ballpark with most other manufactures and ahead of them. These, of course, are precursors to the self-driving era.
Doll: Yes, we have the no. 2 driver-assistance technology in the marketplace today in EyeSight. We are doing things in the market that are applicable in such a way that, as self-driving technology evolves, we are not going to be far behind and will be right there as it happens.