Fame, Feeling And Fluency: A VW Case Study

Volkswagen, as you just may have heard, is in a spot of trouble at the moment. The kind of trouble that wipes a quarter or more off a company’s share price and removes CEOs. Whether the legal fallout from their emissions-test-fixing scandal, and the fines the company face, will cripple or even destroy VW is an open question. But there’s another question to answer too – what are consumers making of all this? How likely are they to forgive VW, or didn’t they care much in the first place?

Image (C) Telegraph Newspapers

Predicting consumer reaction in the wake of a scandal is a tricky business. It’s easy to overestimate the effects of news stories on people’s perceptions – particularly as the common ways of gauging that effect are often flawed. Asking people to predict future behaviour, for instance, is very unreliable, particularly when a single negative news story is dominating perceptions and making certain future behaviour seem more socially acceptable. Looking at social media data is just as problematic: social media is a performative medium with a high degree of norming. Or to put it more plainly, mob mentality today is no guide to brand strength tomorrow.

So what can you do? Keep an eye on the fundamentals. Decisions about brands are like decisions about anything: most of them are made quickly and without much conscious thought. As Gerd Gigerenzer puts it, we are “fast and frugal” decision makers, and we rely on certain broad heuristics to make choices that are good enough.

We rely on Fame – if a brand comes quickly to mind, it’s a good enough choice.

We rely on Feeling – if we feel positively towards a brand, it’s a good enough choice.

We rely on Fluency – if we recognise a brand easily, it’s a good enough choice.

So how does VW perform on the 3Fs – pre- and post-scandal? We’ve been tracking it in its homeland, Germany, where it’s historically enjoyed massive levels of popularity. What have we seen?

There’s been no change in Fluency. Not surprising – if a brand stays visible and hasn’t changed any of what Byron Sharp calls its “distinctive assets”, there’s no reason for it to lose Fluency.

There’s been a slight uptick in Fame, even from a very high base. VW comes even more readily to mind, since it’s in the news all the time. Again, not surprising.

And, finally, there’s been a significant drop in Feeling. This is also exactly what you’d expect – but there is a surprise here. Feeling is still relatively high – there’s been a sharp spike in negative sentiment, but a lot of it from people who previously felt neutral towards the brand. The proportion of people happy with VW has dropped from 58% (enormous for a car brand) to 41% (still very high). That’s a decline, but it still leaves overall Feeling buoyant.

So on our metrics VW is now a 4-Star brand in Germany – still famous, still a good choice, but not the unquestioned brand leader it once was. The future remains cloudy: future growth is less likely. Whereas its surplus of Feeling over Fame would have led us to predict continued solid growth before the scandal, positive feeling for the brand is now lower than it should be for a brand of its size in Germany, with implications for growth over the next year, and a potential increase in price sensitivity

But the initial impact of the scandal has not destroyed the VW brand in its homeland. As the marketing commentator Mark Ritson put it, VW’s years of top-quality advertising and branding may have given it an “insurance policy” that makes steep, ongoing decline less likely. Of course, that’s if consumers, not regulators, are the ones who decide VW’s fate.

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