Toyota set to suffer long term brand damage following vehicle recalls

Unsurprisingly the Toyota brand has been tarnished by its recent series of recalls and its failure to react quickly to address the serious concerns of consumers and the government about the safety of its vehicles. Just how far the brand has fallen in such a short period of time is highlighted by BrandIndex, YouGov's daily brand perception tracker. Going back to January 2008, the Toyota brand has consistently ranked among the top automotive brands tracked in BrandIndex and the top 10% of ALL brands tracked over the last two years.

Since late January 2010, when the car manufacturer announced a recall of several million vehicles across the world, its brand perception scores have dropped dramatically. Figure 1 plots the overall Index (average of Quality, Value, Satisfaction, Recommend, Impression and Corporate Reputation) scores for Toyota in the UK, USA and Germany over the past three months, with the brand in a near freefall over the past ten days in all three markets.

Toyota Index scores last 3 months (1 week rolling average)
Index: average of Quality, Value, Satisfaction, Recommend, Impression and Reputation scores

Toyota's market share varies significantly across these three geographies. In the USA the car manufacturer commands about 16% of the market, while in the UK and Germany, its share is approximately 5% and 3%. Even so, BrandIndex Attention scores (measuring the percentage of consumers who have heard recent news about the brand) have skyrocketed over the past ten days - well above normal levels seen over the last two years. In the USA, 78% of consumers say they have heard recent news about the brand versus a two year norm of about 45%. The spikes are even greater in the UK (47% today versus 15% over the past two years) and Germany (47% today versus 10% over the past two years).

Toyota's Attention scores last 3 months (1 week rolling average)
Attention: the percentage of consumers who have heard recent news about the brand

And BrandIndex Buzz scores (measuring the positivity of media coverage / word of mouth) demonstrate that all of that Attention is driving consumer sentiment down for the brand. Figure 3 plots Buzz scores in five countries around the world: UK, USA, Germany, Sweden and Denmark. In all of these markets except Sweden, Toyota Buzz has turned sharply negative in the last ten days. Ted Marzilli, Global BrandIndex Managing Director commented, “One possible reason for more positive consumer sentiment towards Toyota in Sweden is the problems their local car manufacturers are experiencing, which currently dominate media headlines in the region.”

Toyota's Buzz scores last 3 months (1 week rolling average)
Buzz: positivity of media coverage / word of mouth

 

Ted Marzilli, Global BrandIndex Managing Director continued ...

“While the dramatic decrease in Buzz may not be surprising, the more important question for Toyota and its competitors is the likely duration of the dent in consumer perception. Following safety violations at Southwest Airlines in March 2008 resulting in nearly a thousand cancelled flights and a $10.2MM fine from the FAA, Buzz scores took over 6 months to recover. The Toyota crisis is similar in magnitude and we wait to see whether there will be a similar recovery period, providing no additional issues or missteps occur over the next several weeks and months.”