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Jon Castle, Senior Vice President, Group Account Director, Arnold Worldwide in Boston
Wednesday, April 11, 2001, 4:00 - 5:00 p.m. Eastern

<jcastle> hello everyone -- hope I can answer your questions today
<jcastle> anyone out there drive a VW?
<wellslaw>I've owned a '61 bug, '66 bug, '67 bug, '70 microbus, '95 jetta iii, and I'm probably forgetting one ... ah, the '68 karmann ghia...
<machiavelli> I don't drive one..but I sure see a lot of them. ;)
<wellslaw> well, I was wondering what the biggest opportunity for VW is in the EU right now
<jcastle> EU as in Europe or America?
<wellslaw> European Union = EU
<machiavelli> Hi there. I have a question about campaigns...how important is regionalism?
<wellslaw> I understand that the German sales have fallen and that the brand usually has that as a stronghold -- what about the other nations within the Union??
<wellslaw> and the region in general
<jcastle> with regards to regionalism, it is pretty important depending on the message you have -- if you are trying to build a brand that has been quiet for a while, like VW was in the early 90's, then you need to get out a national brand message -- region
<alexrusso> what about with VW affiliated brands like skoda or seat?
<jcastle> regional advertising and messaging is pretty important when you have various different desires -- 4 wheel drive in the north, diesel in the Midwest, etc.
<wellslaw> by north and Midwest -- do you mean USA or EU?
<jcastle> geography was related to USA
<wellslaw> gotcha
<machiavelli> So VW went for a more national campaign as opposed to targeting specific sections of the country? Or were there particular advertisements for each region that could be linked together in a general theme?
<jcastle> we do not do as much in the EU -- but they are having a bit of a tougher time -- all brands are -- VW's biggest opportunity is in ASIA right now -- along with south
<wellslaw> Why, in your opinion, are "all brands" having a tougher time in Europe? Is it the unification or just car sales waning in general -- I understand Fiat's new car is doing well. (By the way, I am in the middle of a project on VW in Europe ... that is why I ask)
<jcastle> Wellslaw, you are way ahead of me -- you probably know more about the specifics in EUROPE than I do -- we focus on the US, although we are just getting involved in VW's business in Germany
<wellslaw> okay, I'll move along to the good old US then ... and thank you for what could be interpreted as a compliment!
<pmalone> How has VW used the positive historical memory of the bug to help sell the new Beetle?
<jcastle> in 95, we needed to make the vw brand important again in America -- we needed to dust off the old image -- one that had not been talked about for many years -- they had poor quality products and were not seen as competitive -- so we needed to make VW stand...
<jcastle> for something again -- and to focus on our best prospects -- drivers -- on a national level -- was the best course of action
<jcastle> re: the new beetle and old memories, we could never overlook the incredible positive historical influence the old beetle has had --
<jcastle> the love of the car, the brand -- despite not having any heat -- was very powerful -- in our marketing, we needed to position the car as a modern Drivers car, but with a nod to the past
<jcastle> less flower, more power. The engine is in the front, but its heart is in the same place. Things like that
<machiavelli> What is the target market for the new beetle? Is there a particular income bracket or type of person being sought after?
<jcastle> Mach -- target has been focus on people 18-80 -- anyone, really -- for VW, it is less about demographics and more about psychographics -- it is a state of mind . . .
<machiavelli> Basically who exactly do you mean when you say "drivers".
<jcastle> we say you can be young, but it is more important to be young at heart -- it is centrally based on the theory that you are not a "passenger", you are a driver . . .
<jcastle> and this positioning is one that is very invitational, even though you may not be a "driver" by the specific definition . . .
<jcastle> do you like to drive rather than ride, do you occasionally break the speed limit, do you like hills and windy roads -- things like that define you literally as a "driver" . . .
<jcastle> but again, it has a whole different meaning -- are you a leader -- are you someone who grabs life by the horns -- you get the picture
<alexrusso> Sure, but the youth oriented, ironic wink, wink style of the current campaign surely has a demographic and or regional focus or does better in some areas or with some groups than others.
<alexrusso> Similar to questions of demographics, what are the regional variation of VW sales in the US?
<jcastle> alex -- sales for VW are very bi-coastal -- think of more urban, more affluent, more young people -- these cities are best -- east coast, west coast -- Boston, NY, Atlanta, Miami, Portland, San fran -- with some Chicago, Denver, etc
<leolog> I'd like to say the campaign for the new beetle was great, but what are your marketing plans for it now since the car will probably not change much physically from older models?
<jcastle> leo: we just broke a new campaign this past Monday (see the Monday NYTimes article on the effort) -- called "Round for a reason" we are injecting the car marketing with a little more rationale as to why the NB is such a good car -- not just . . .
<jcastle> emotional advertising that feels good -- we think focusing on those people who need a little help justifying their purchase -- like some think it's not safe and in fact it is the safest car in its class
<machiavelli> Interesting. It appeals to dynamic individuals. Was there any borrowing of the whole iMac color marketing scheme when it came to the VW Television ads? I remember one in particular that dealt with an aqua coloration.
<wellslaw> the pink moon commercial does not say "driver" to me -- it says, relax and enjoy the serenity of night -- is that an exception?
<jcastle> wells: pink moon -- actually my favorite of the last 6 years -- it doesn't have to be about driving around curves fast, downshifting, etc . . .
<jcastle> that spot is all about the love of driving -- nighttime with the top down, music on, summer breeze, with your friends . . .
<wellslaw> that is a great song and a great ad.
<jcastle> and deciding that the drive is more enjoyable than the keg part -- these people are very much drivers . . .
<jcastle> and it is also a spot that makes people feel GREAT about VW
<wellslaw> I see ...
<wellslaw> almost got me to buy one again.
<pmalone> Can you push the safety features of the new Beetle without reminding people how unsafe the older version was?
<jcastle> Pmalone: ahhhh, the professor has entered the room . . . .
<jcastle> well, we are well beyond the threat of lawsuits from the old beetle (I think) and, again, people loved the car despite all of its misgivings . . .
<jcastle> in addition, it wasn't the only car that wasn't safe -- did you even have seatbelts in the 70's???
<wellslaw> the old beetle was unsafe -- for its time ... with 4 wheel independent suspension, torsion springs, swing axles, ... I don't think I agree with that.
<pmalone> Good suspension, but very light and with a fuel tank that tended to leak if the VW rolled over in a wreck. I have a friend who was an emergency response fireman, and he dreaded working on VW wrecks in the 1960s.
<alexrusso> Speaking of Pink Moon, Can you comment on the role of the advertising industry in breaking new bands or resuscitating old (or dead) careers? Or of your position as a "culture maker?"
<machiavelli> Yes it'd be interesting to know how certain jingles are chosen
<jcastle> Alex -- only a few years ago, no self-respecting band would ever "sellout" now I think there are many who are using Madison Ave as their own marketing tool . . .
<jcastle> nick drake's estate has sold more copies of his disc in the last year than in the 25 or so since Nick passed away . . .
<wellslaw> if I recall correctly when I went looking for the "pink moon" album for my father-in-law for Xmas (he's an old hippie) the artist died in like 1972 and that was almost his only album -- who dug that up, so to speak?
<jcastle> I would shy away from "culture maker" phrase -- but it is great to see the work that has been done show up as a parody on the Tonight Show
<dan_shindell> Does the absurdity level of the current VW advertisements (eg the car falling from a tree) point to how little the consumer cares about the technical aspects of the cars?
<jcastle> Dan -- how dare you say absurd -- I'm sure you mean "over the top" :-) . . . .
<Dan_shindell> Of course, over the top. They seem to be relying on associations that have little to do with the actual car and more to do with catering to the humor of the youth niche.
<alexrusso> No doubt, but what do you think about the application of a certain group's "cultural capital" to a product. Is there a line to be drawn? What does it say about the status of the ad industry or music industry?
<pmalone> Of course the Pinto was a worse problem in rear collisions.
<jcastle> I think that people do car about the technical aspects, but in the end, the advertising needs to do it's best to differentiate itself and make the brand stand for something and be valuable . . ..
<wellslaw> pmalone: If I recall, most gas tanks leak when upside-down, but no need to argue the point -- It certainly was no Pinto
<jcastle> so you go ahead and part with 20K for 4 wheels -- why buy a camry vs. an accord? I would say they are pretty much the same -- but the advertising can help to differentiate . . .
<machiavelli> Dan: I think you get that with any type of car like a Suburban or the huge SUV's that they have advertisements for that show them crushing mountains and the like.
<jcastle> volvo has done an EXCELLENT job at becoming known for safety -- are they truly SAFER than every other model out there???? . . .
<pmalone> I agree that it was certainly no Pinto in safety problems and it was much more reliable than American small cars of the 1970s.
<wellslaw> and at this point you are also trying to build back up awareness of the brand after the "quiet" 90s, yes?
<jcastle> For VW, we want to be a brand that is likable, fun, unpretentious -- we don't take ourselves too seriously -- we let the viewer in on the joke . . .
<Dan_shindell> true, but I'd be interested to know what type of market research vw did to lead it down this direction, which I find brilliant and hilarious.
<jcastle> we don't try too hard, we have fun -- and there is still a rational message -- the tree spot is about how fast it is off the line -- the da DA DA spot is about how big the hatch back is . . .
<wellslaw> Is there any thoughts on tying back to the "roots" of VW -- the "people's car" and to attempt to TRULY globally market the car that way ... or is that simply impossible to cross cultural lines like that?
<jcastle> we are selling, but in a rather nice way -- would you rather we yell at you (like most traditional auto ads) ???
<Dan_shindell> No, not all. I'm not trying to indict you, but I find the ad campaign intriguing.
<Dan_shindell> Oh, I guess those points were lost on me, but I do admit that I still want to buy one.
<wellslaw> global village, global car etc
<jcastle> wells -- funny you should ask --I think the the true vision of "people's car" -- a car for everyone -- is lost in the literal sense -- cars cost more than $20000 nowadays . . .
<jcastle> but I do believe that companies like VW can do a better job at being a global marketer -- we have thought a bit about Germany in the last several weeks and even though there are differences -- they have a . . .
<jcastle> 20% marketshare -- the brand stands for many of the same things. . . .
<machiavelli> I'd be interested to know if this new "fun spirit" in the VW advertising division has been pushed by older advertising executives? Or has VW imported new, younger, and more "with it" executives?
<jcastle> mach -- arnold worldwide is pretty young, entrepreneurial and by and large a reflection, at least attitudinally, of our work -- again, it is about state of mind
<leolog> the commercials for the online only editions of the new beetles were very persuasive ( made me wanna buy one). Was that a successful experiment? (i.e. did people buy the car online?) or did most people buy the car through a dealer anyway?
<jcastle> Leo -- we are legally obligated to sell cars through dealers -- but it was VERY successful as we took a major step in testing how to do business online . . .
<jcastle> we want to get to the point that a customer can buy a car anyway they want to (no we aren't going to enlist Steve Perry and Journey on this idea) . . .
<jcastle> but we did sell them all -- and we helped to force the issue and demonstrate the web's power to the dealers who are resistant to change by nature (some of them)
<wellslaw> and they go faster than 65 mph too -- Hitler's specs ... but do you think such a campaign could be launched in theory and be successful
<Dan_shindell> I like machiavelli's line of questioning. The vw campaign is one of the first to cater to a youth market that it not demeaning or insulting.
<wellslaw> the utility of the brand ... or is the brand just not in that direction anymore -- I know in Europe the commercial end of the brand is present where it is not in the USA
<talisman99> Castle, do you have anything to do with Audi's advertising? If so, how much work is necessary to separate shared platform autos in the US market?
<machiavelli> Yes but has this state of mind come from people who have worked on the VW beetle before? Or with older more "traditional" campaigns? Or are these new themes being put forward by a younger crop of advertisers?
<wayneleighty> Have you ever worked on an advertising campaign whose goal was other than growth, increased market share, increased product throughout?
<jcastle> wayne -- what would the goals be, then?
<wayneleighty> securing a position in inevitable and approaching steady-state economy of limited physical earth?
<jcastle> wayne -- I'm just an ad guy -- can you re-ask the question?
<wayneleighty> Improving product rather than sales?
<machiavelli> Has this "state of mind" that you have referred to by the advertisers come from people who have worked on the VW beetle before? Or is this from those who have worked on older more "traditional" campaigns? Or are these new themes proposed by a younger crop of advertisers?
<jcastle> all the work since 1995 has been done by people who are new to VW advertising, new to auto ads in fact
<machiavelli> Very interesting.
<pmalone> The Passat is getting very good press in the US but one 4 wheel drive version is entering the luxury price range. Will VW try to create a new image for this upscale market?
<jcastle> pmalone -- we hope to continue to take the brand to a higher level -- nicer cars with more of the same wonderful brand image -- . . .
<wellslaw> did you all research the old 60's ads for inspiration for the beetle -- i.e., "same ugly car" etc
<wellslaw> new beetle ads
<pmalone> Are you at all intimidated by the history of VW advertising, with so many now classic ads from earlier decades?
<jcastle> pmalone -- intimidation is not really a factor -- we do what is right for the brand today and for the future -- it is one of the greatest campaigns of all times -- we hope to be just as successful in our own right
<jcastle> some said five years ago -- a $20K VW?? no way -- but now the passat is hugely successful, averages $24K, and we sell 100,000 per year . . .
<talisman99> how about the semi-luxo passat being differentiated from its Audi sibling?
<alexrusso> do you worry about cross brand competition if you start moving into Audi demographics?
<jcastle> we need to continue to push the brand upmarket as there is an 8 cylinder coming -- and an $80,000 luxury VW in a few years . . .
<wellslaw> vw passat . audi ... could this result in the problems GM has had with their sub-brands cannibalizing each other
<jcastle> tali -- we have found with Passat and Audi A4, for instance, that there is very little cross shopping and there are different buyers -- I don't think there will be much cannibalism . . .
<jcastle> but competition makes both brands better
<Cliff> to what extent do your clients shape the advertising campaign? for instance, do they come to you with ideas about which niches to target and features to highlight, or do you do that part yourselves?
<jcastle> cliff --we work with our clients in a great partnership -- we work together on targeting, messaging, strategy -- things like that -- but the Creative magic is done by the guys up on the 19th floor here in Boston
<machiavelli> Here's a question...do you yourself own a VW beetle or do other people who have worked on the project?
<jcastle> Mach -- we all own VW's -- I have 5 -- I drive a GTI, my wife a EuroVan, and I have a '66 beetle, '66 bus, and a '49 (yes '49) beetle
<jcastle> but the creative director does drive a new beetle
<jcastle> and it is a GREAT car to drive -- not just a pretty face
<leolog> What do you expect the future of VW to be? a luxury brand or economic, youth-oriented?
<jcastle> the future will be a focus of being the best in every class in which we compete -- The benchmark, if you will -- we make cars that are German engineered, fun to drive -- . . .
<jcastle> and we aren't going to compete in the under $10k category -- so we are moving a bit upmarket, but we will always retain the legendary VW value as a part of our strategy --- . . .
<jcastle> the passat is a car worth a lot more than its low-20's pricetag
<leolog> I agree, it is worth more
<Dan_shindell> as an owner of a new beetle, I would agree
<wayneleighty> How is it decided when to prep. the market with advertising prior to release of a new model? Is this tied at all with publicity for concept car shows?
<talisman99> not to knock you guys or anything, but it does have the slowest 0-60 times in road and track
<jcastle> talisman -- it's not all about speed -- but wait for the 201 HP beetle -- it may not be too far away
<Dan_shindell> I have to say I was a little disappointed with the gas mileage of the new beetle.
<jcastle> wayne -- we usually launch new ads when cars are at market availability -- it is the law to have products advertised to be readily available -- unless we are doing a teaser - - -
<machiavelli> Are there any concerns, especially now that the environment is a hot topic, that your "drivers" image will contribute to more traffic, pollution, etc. etc. especially since that type of marketing encourages one person use of a car instead of carpooling?
<jcastle> mach -- niche group who is really concerned -- unless we have a MAJOR crisis -- americans love the open road, they love to drive -- there is a love affair with cars going back over 100 years -- I think our positioning is not too much of a problem
<jcastle> Dan -- try the new beetle tdi 9diesel -- 49 MPG
<Dan_shindell> thanks for the tip.
<jcastle> and it is a diesel that doesn't know it is a diesel -- better low end torque, faster 0-30, and VERY fun to drive
<jcastle> also there is a golf and jetta tdi with similar mileage
<leolog> who does your agency see as a major threat (i.e.competitor) to your beetle. I see the ford focus gaining a lot of young people's acceptance
<jcastle> Leo -- the focus is on average 3-6000 bucks less -- it is doing a great job of getting some of that younger buyer -- the cars don't really compare in my opinion -- drive them both and you'll see . . .
<jcastle> but their marketing has been pretty good -- other cars like the pt cruiser, the mini -- they are all a little different and would be considered competition
<leolog> I agree but is that what u consider your major competitor?
<jcastle> Leo -- at the risk of sounding arrogant -- and we truly are not -- we don't pay too much attention to the competition -- we focus on doing the best . . .
<jcastle> we can with the product and brand we have -- they are threats -- but if you really want to buy a focus, no problem - - - . . .
<alexrusso> Does VW have any plans for low emissions vehicles?
<jcastle> Alex -- low emissions -- there are incredible things being developed -- but I will have to kill you if I tell you . . .
<jcastle> seriously, they are doing some great things most of which I don't know about -- but they are looking at electric, low emissions -- everything
<leolog> fuel cells I hope
<Dan_shindell> I would like to know if you have any personal views on the recent boom in retro-styling. You mention the pt cruiser and a century-long love affair with autos. What are we hearkening back to, and why now?
<jcastle> our style is best summed up in and early ad line we used in 1995 -- we would talk about our brand and then say "that's what we're about -- is that what you're about?" . . .
<jcastle> a wonderful way to invite you into the brand, but if you want to buy a competitor, cool with us -- its up to you -- nice soft sell
<jcastle> Dan -- I'm an ad guy -- not a sociologist -- I don't know why there is such a shift -- but the interest in a new VW microbus is pretty hot
<machiavelli> If you had to pick a word or phrase that can be associated with the VW beetle, something that you want others seeing a person driving one to immediately think of, what would that be?
<jcastle> mach -- individual
<wayneleighty> Thank you
<machiavelli> Thanks very much for your time. It was quite informative.
<jcastle> happy to answer anything else
<leolog> great discussion, thanx
<pmalone> Great session. Thanks for handling so many questions in an hour.
<alexrusso> yes, thanks.
<Dan_shindell> thanks for the info and for typing so fast.
<machiavelli> Oh one last thing. How long did the campaign take to develop before it was released?
<jcastle> which campaign?
<machiavelli> The one for the NB.
<jcastle> the NB work was done for about 6 months in advance of its launch
<machiavelli> The new "compact" version I take it. Great gas mileage.
<jcastle> yes, great for the environment
<jcastle> I guess I'm done here -- thanks for having me -- jon



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