Yesterday was the last day of June, and I deliberately waited till it ended to publish this post. A large part of my hesitation comes from the fact that June is pride month, and we all know what companies do in June. This meme represents it quite well:
This has become a trope for the LGBTQ community, so much so that it’s become a ritual for some of them to make fun of the atrociously unoriginal, and patently insincere attempts of large companies to jump on the rainbow bandwagon.
There’s even a name for this: rainbow capitalism.The community is quick to realize that brands want nothing more than to cash in on an “untapped market”, as opposed to being inclusive and welcoming in their messaging for the sake of encouraging broader societal change.
However, amidst all this noise, there is one company that almost everybody knows is on the “gay side”, and it never resorts to cheap tactics like slapping a VIBGYOR veneer over its logos online.
That brand is Subaru.
The Little Star from Japan
For those who don’t know, Subaru is the automobile manufacturing division of Fuji Heavy Industries (which recently changed its name to Subaru Corporation). They make cars and operate largely in the East Asian and North American markets.
Gearheads among you would know that they even tried entering the Indian market once! But as is the case with most foreign automotive marques, they didn’t do very well here.
Subaru’s story begins in the coveted summer of ‘69, with a tiny car called the 360. It was tiny, quirky, and economical, and did a class-leading 66 miles to the gallon (that’s 28 kmpl, a rare feat in 1960s America).
It was made for a post-war Japanese customer base who were just beginning to experience economic prosperity and was a huge hit in its home market.
Its success prompted one brave American dealer to consider bringing it to the U.S.A. Remember, this was the time when heavy hitters such as Honda, Datsun, and Toyota were already beginning to make inroads into the American market.
Subaru needed to differentiate itself somehow, and it did something that would go on to become the cornerstone of its marketing strategy: adopting the face of an underdog.
Unfortunately for Subaru, its launch coincided with the rise of the saintly Ralph Nader, best known for having pressured the car industry to adopt stricter safety norms. Ralph had immense clout with the American public, and he stated that the 360 was a seriously unsafe car (which it was).
Bam. Subaru’s first foray into the American market ended with a faceplant.
But the company didn’t give up. It knew that it couldn’t compete with its rivals directly and had to figure out ways to stand out from the competition, and that’s precisely what it focused on doing, for the next 20 years.
Dare to be Different
Unlike SaaS companies, product marketing in the car business means that you can’t coast on messaging alone. You need to have a truly differentiated product to provide the base from which alternative messaging strategies can work.
Subaru knew this and made some unconventional decisions when it comes to product development.
Its first car after the 360 was an FF-1 (known in America as the Subaru 1000) which featured a boxer engine, an unconventional choice for a road-going, family-friendly sedan.
Two years later, it released a four-wheel drive station wagon, popularly known as the 4WD wagon, and immediately created a name for itself. It was the only manufacturer that was producing a family-friendly station wagon with all-wheel drive.
Remember these features, we will refer to them later.Subaru spent an inordinate amount of time developing its capabilities of building reliable boxer engines, and effective four-wheel drive systems. In the process, it unintentionally created some category-straddling vehicles, some of which went on to become cult classics.
Sales began to climb and the company was doing rather well, until the mid-80s, that is.
Ronald Reagan, the erstwhile president of the U.S.A. implemented a weak dollar policy, which meant that exports were cheaper than imports. This resulted in massive price increases for Subaru, which translated to a slump in sales.
Subaru had lost its target market and went into what Tom Doll, a long-time Subaru veteran called “the valley of despair.” The company just couldn’t figure out what to do, where to go, and if they could even recover from such a major blow.
By the 1990s, Subaru’s brand equity was practically non-existent. What they had going for them was that they had all-wheel standard on all of their vehicles (this is pretty impressive if you think about it).
Since cost structures were no longer in their favor, the company deployed its marketers to find out what kind of people would be willing to pay a premium for all-wheel drive. Remember, all-wheel drive enables cars to perform well even in extreme weather conditions and poorly-paved roads.
They came up with four distinct groups who contributed to 50% of the company’s sales in the U.S.A: teachers and educators (hey, I’d buy a Subaru too!), health-care professionals, IT professionals, and the self-proclaimed outdoorsmen (and women :D).
And then, they uncovered a fifth: lesbians, i.e. homosexual women.
This was Subaru’s “Aha!” moment.
They chanced upon this by examining hotspots for Subaru’s sales, which came from far-flung corners such as Northampton, Massachusetts (a countercultural hub that gets extremely harsh winters) and Portland, Oregon (yet another bastion of counterculture located in the Pacific Northwest).
Upon talking to the customers who purchased Subarus from these regions, they realized that almost all of them were women, heads of the household, and co-habiting with other women.Paul Poux, who was consulting with Subaru of America at the time, says:
“There was such an alignment of feeling. They felt it fit them and wasn’t too flashy.”
Subaru had come upon a truly astounding piece of detail. Their cars appealed to lesbians and other well-educated yuppies, who loved that they could deal with all sorts of terrain, weren’t too flashy, and were practical without appearing too bulky (like most American SUVs).
So what did Subaru do after learning this?
They re-oriented their entire marketing focus towards the LGBTQ community, all while ensuring that they didn’t alienate their mainstream audience.
Opinionated Brands, Opinionated Campaigns
Subaru did all of this in the 1990s when the overall political and cultural climate was not too welcoming of queer folk. Bill Clinton (the American president at the time) had implemented the ‘Don’t Ask, Don’t Tell’ policy, which theoretically lifted the ban on homosexuals serving in the army, but barred openly homosexual people from enlisting in the first place.
Subaru was swimming against the tide, but boy did they do a stellar job at it. Look at the following print ads:
For straight customers, this would read as Subaru talking about their all-wheel drive system, or their decision to use a boxer engine. To homosexuals, it’s a nod to their orientation.
This one is particularly ingenious. If you zoom into the number plates of each of these cars, you’ll see that they read ‘CAMPOUT’, ‘XENA LVR’, and ‘PTOWNEE’ respectively.
CAMPOUT could either mean camping out, and ‘camping out’ (in the same way as coming out). XENA LVR was a nod to the TV show, Xena: The Warrior Princess, where the protagonists (who were women) were assumed to be in love with each other. PTOWNEE refers to Provincetown, Massachusetts, which was a popular vacation destination for queer folk.
Subaru continued with this focus on the LGBTQ community, so much so that Subarus and Lesbians now go hand-in-hand in pop culture.
Practice what you Preach
Subaru didn’t just portray itself as an inclusive brand, it lived it. It was one of the first companies in the USA to offer domestic partnership benefits to same-sex couples.
It signed Martina Navratilova (a famous lesbian tennis star) as a brand ambassador when others refused to do so out of fear of alienating their audience. They also routinely contribute to charities and foundations that work towards helping queer folk.
Over the years, Subaru went one layer deeper and encapsulated its brand identity in one word: ‘love’. If you look at some of their campaigns from the mid-2000s, it revolves around the slogan
“Love. It’s what makes a Subaru, a Subaru.”
In the past few years, they’ve also gone out of their way to appeal to dog lovers. One of their most popular ad campaigns in recent times featured a family of golden retrievers, called the Barkleys, driving their cars.
In line with their habit of practicing what they preach, they routinely sponsor dog adoption events in their dealerships. This is a masterstroke, especially in a country that has more dogs than kids.
All of this translated to some stellar commercial success: during the 2008 global financial crisis, Subaru was the only brand to grow, while rivals were floundering. In the 2010s, the only brand that grew faster than Subaru was Tesla.
Subarus routinely feature in the top 3 segments in the Kelley Blue Book rankings for non-luxury cars. The brand never has to offer discounts to clear inventories, and their resale values are generally on the higher side. Heck, some of their lesbian owners are particularly picky about whom their cars go to, with many actively favoring other lesbians as buyers.
Today, Subaru doesn’t have to worry about waving the rainbow-colored flag in the month of June. It doesn’t need to concoct elaborate (but cringe-y) campaigns to speak to the marginalized.
That’s because being an underdog, an outsider was in their DNA. Subaru did some major soul-searching, figured it out, and baked it into the company.
Now that you’ve read all this, here’s my question to you: If you’re working for or running a consumer brand: What’s your DNA?
The survival of your company might depend on your answer to that question.