LOS ANGELES, May 6 /PRNewswire/ -- Ten years ago tomorrow on May 7, 1998, Mercedes-Benz bought Chrysler for $36 billion (U.S.) and formed DaimlerChrysler in the largest industrial merger in history. The national average for gasoline was $1.20 a gallon. A decade later, the national average price of gasoline is $3.80 a gallon and DaimlerChrysler no longer exists. The once celebrated industrial merger is now a Detroit water cooler joke. Daimler sold majority interest of Chrysler to Cerberus Capital Management for $7.4 billion in 2007. "Clearly there were many marketing mistakes after the merger," said Chris Stiehl, a former GM marketing researcher and co-author of the new book Pain Killer Marketing: How to Turn Customer Pain into Marketing Gain (WBusiness Books, April 2008). "Ten years ago car manufactures were thinking bigger cars with more horsepower. They didn't consider customers' pains," Stiehl said. In his book Pain Killer Marketing, he pointed out GM's $3 million leather seat mistake in the '90s. "GM wanted a perfect leather seat in their new Cadillac, so they sprayed a layer of chemical to protect the perfect leather seat." It turned out, "customers wanted to smell their new leather seats and the spray blocked the smell of the new leather seats." "You've got to find out your customers' pain when you develop your marketing strategy" says Henry Devries, co-author of Pain Killer Marketing. "If you give customers two choices, either to avoid pain or to gain pleasure, most people will choose avoid pain first." So what do we learn from $36 billion? Chris Stiehl pointed out 3 lessons we can learn:
1. Listen to customers' pains. Daimler and Chrysler were trying to
create their synergy by integrating technology; but the car they
designed, Chrysler's Crossfire, was a product customers don't want.
Always listen to your customers first.
2. Listen to employees' pains. What works in Germany doesn't always work
in Detroit. The "culture match" is crucial to make any merger work.
Many mergers fail because companies lay off employees instead of
listening to them.
3. Listen to investors' pains. DaimlerChrysler creations focused heavily
on global market shares. Investors care about profits. Never forget
what your shareholders want!
Information on Pain Killer Marketing at
http://www.painkillermarketing.blogspot.com
WBusiness Books: Win Wealth Worth http://www.wbusinessbooks.com
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