How Olivier François Is Fixing Fiat for Its Return to America

Injecting just enough sex and sizzle into the Italian auto brand

In 2011, as Fiat struggled to reestablish itself in America after a near three-decade absence from the market, the Italian auto brand didn’t have to call some guy named “Tony” to pop the hood. Olivier François was available for—and as it has turned out, quite up to—the job.

You may recall the old joke that Fiat was an acronym for “Fix it again, Tony”—meant to underscore the brand’s perceived lack of quality and penchant for rusting. Fiat, in fact, suffered a disastrous run of about 10 years in the U.S., in which annual sales went from about 100,000 vehicles in the mid-’70s to some 15,000 by the time it up and left in 1984.

While the company still faces a long road before its comeback can safely be deemed a success, industry experts credit François—who joined the automaker in 2005 and, since 2011, has served as worldwide Fiat brand CEO and CMO of Chrysler Group and Fiat Group—with getting its U.S. marketing effort headed in the right direction. “America is not the core of our sales but a very interesting field of experimentation for the brand,” says the marketing chief.

The fact that Fiat, in its current incarnation, is still a newcomer here rather than the established brand it is in Europe allows François and his team to try new things without the intense pressure that comes with being a market leader. “You need to be hungry for sales but not at any cost,” he says. “Growth is one thing, but the quality of the growth is something else. We have to protect the brand.”

After Fiat pulled out, the brand was largely forgotten in the U.S., though it remained popular in many foreign markets, including Latin America and Europe. (At home in Italy, Fiat’s standing is comparable to that of Ford in the U.S., while Brazil is also a stronghold.) By March 2011, Fiat and Chrysler were closely aligned (Fiat owns 58.5 percent of Chrysler and exercises operational control). Seeking to enter a potentially lucrative market as Europe’s economy sagged, Fiat returned to U.S. soil with the small-frame Fiat 500 city car, sporting a base sticker price of $15,500.

Industry watchers predicted Fiat would face a steep climb. “It’s tough to reintroduce a brand once it has failed in the U.S.,” notes George Peterson, president of the consulting firm AutoPacific, owing to “lots of old baggage left in the memories of consumers. Plus, they wonder if they can trust the brand to stick around for the long haul. Confidence is a big part of the buying decision. ‘Fix it again, Tony’ is still remembered.”

The comeback was quickly stalled by several challenges: an anemic U.S. economy; the fact that Fiat debuted with a single subcompact model in a market where size impresses consumers; and a failure to get dealers on board. “Fiat’s pitch to dealers was weak in the beginning,” says Peterson, resulting in just 30 domestic dealerships at launch. “Insisting on separate showrooms made adding a Fiat franchise to a Chrysler store an expensive proposition. They later weakened those requirements.”

The Long Road

Having a solid advertising program in place might have helped compensate for such deficiencies, but Fiat’s initial efforts to promote its comeback generated little buzz. In retrospect, the brand excelled at peripheral marketing programs while ignoring the bigger brand-building picture.

 

 A big part of Fiat USA’s strategy was targeting younger consumers via social media. The brand had a strong presence on Twitter and Facebook right from the start. Fiat also released an iPad app early on, as well as a music video featuring a rocked-up version of Vivaldi. The brand even got experiential, unveiling pop-up drive-ins around the country where it would screen original versions of films that had since been remade (a nod to the fact that its return to the U.S. was itself a “remake”).

But many in the auto industry, including Fiat’s own dealers, lamented the lack of a broad-based marketing strategy with a strong TV component. Social outreach and experimental efforts were all well and good but failed to make an impact. Few prospective buyers even knew the brand was back. Sergio Marchionne, CEO of Fiat S.p.A. and chairman and CEO of Chrysler Group, summed up the launch in January 2012 by telling Automotive News: “It was a poorly executed plan.”

Fiat’s national TV spot, from Detroit agency Impatto, didn’t break until five months after the models were available. Drenched in nostalgia, with Elvis’ “Jailhouse Rock” as the soundtrack, the drive-in-themed clip showed a 1957 Fiat 500 morphing into a new model. A voiceover informed viewers: “Another icon has arrived, and ready to prove once again it’s the simple things in life that have the biggest impact.” Reactions were mixed. Adweek’s Tim Nudd judged the message “a little overwritten,” but noted, “The tagline, ‘Simply more,’ positions the model as a deceptively diminutive vehicle that hits well above its weight.”

Chris Cedergren, president of consumer insight firm Iceology, is far less charitable. “That first ad was horrible,” he says. “It wasn’t what Fiat was all about.”

Soul of the Machine