Why is this work relevant for Creative Strategy?

This work demonstrates the difference that data can make to real life experiences. To sell a car designed for urban exploration, we needed to prove the viability of it in Hong Kong — where the world’s highest rents have forced small businesses to find locations in the least visited parts of the city. SMALL BUSINESS DRIVE matched the personal interest and location history data of drivers with real-time data on business listings, traffic conditions and road types to recommend interesting businesses to explore via routes that demonstrated the car’s versatility.

Background

BULLIED BY THE 'GERMAN 3'. Lexus in Hong Kong has always been out-competed by BMW, Mercedes-Benz and Audi who command higher brand prestige. For every Lexus owner there are two BMW, two Benz and 1.5 Audi owners. The average annual media spend of the German 3 in 2018 was 2.4 times that of Lexus. For the launch of its first car in the Medium-Luxury SUV category, it had to beat established market leaders — BMW’s X1 and the GLA from Mercedes-Benz. As a luxury luxury crossover designed for urban exploration, the imperative was to penetrate a segment of urban lifestyle enthusiasts. Objectives: 1. Achieve higher leads versus previous launch via test-drive bookings and completions. 2. Achieve higher sales versus previous launch via test-drive conversions.

The Interpretation of the Challenge (30% of vote)

In order to sell a car designed for urban exploration, we needed to prove the viability of it. While this may never be questioned in other big cities, in Hong Kong it’s a different case. For our audience, exploration is all about social currency – being the first to visit the trendy galleries, studios, shops and cafes that offer something different from Hong Kong’s monotonous cookie-cutter malls and shopping districts. However, with the world’s highest rents, Hong Kong’s unique small businesses are forced into unpopular parts of the city. Lexus’s line ‘Experience Amazing’ is about the pursuit of amazing experiences in everyday life. Staying true to this belief, we showcased the urban exploration qualities of the UX by creating Small Business Drive, the first data-driven test drive that connects drivers in search of unique experiences with relevant small businesses in parts of the city they have never visited before.

The Insight / Breakthrough Thinking (30% of vote)

Due to the density of the city, the efficiency of the train system and the high cost of vehicle maintenance, ownership of cars is only at 8.2% of Hong Kong’s population. Having selective target segments is critical. Luxury brands traditionally focused on the affluent segments with higher spending power. But with the UX, we adopted a behavioural and psychographic segmentation approach instead. Through cluster analysis of over 6,000 individuals, we identified a most promising segment termed ‘Change Seekers’. Although this segment only represented 3% of the population, these 20-49 year olds were receptive to Medium-Luxury SUV form factor and embraced ‘having a keen sense of adventure’. 78% of them ‘liked to pursue a life of challenge and change’, while 84% of them feel ‘always ready to try new and different products’. In spite of the small segment size, only 0.05% penetration would exceed sales KPI.

The Creative Idea (20% of vote)

Using a mix of 1st party, DMP and social data, we targeted Change Seekers with campaign content and triggered them to register online for a test-drive at a pick-up location of their choice. Upon stepping into the car, they open a custom-built app on an installed iPad, signing into their Facebook account, and permitting the app to read their social interests and location history. In conjunction, our algorithm crawls real-time datasets on business listings, traffic conditions and road types from public APIs. This data is used to determine unvisited businesses relevant to their interests. The app recommends three choices. Upon choosing one, it maps personalised routes designed to demonstrate the car's versatility across different terrains and roads, whilst avoiding bad traffic. On arrival, a VIP card containing spending credit was presented as a reward for the discovery. After the test-drive, they receive personalised communications on packages they express interest in.

The Outcome / Results (20% of vote)

LEXUS BROKE “GERMAN 3” DOMINANCE TO BECOME A TOP 3 LUXURY CAR BRAND IN HONG KONG. The UX was the TOP GROSSING Medium-Luxury SUV during the campaign period. The amount of UX sold in the first 90 days was: 3x that of Mercedes Benz GLA. 1.4x that of BMW’s X1. This was a direct result of Small Business Drive. UNPRECEDENTED PERFORMANCE ON MARKETING KPIs: 128% of Sales Target Achieved. 24:1 Return-On-Marketing Investment. 5x More Leads Generated* 3x More Test-Drives Completed* with a High 33% Conversion Rate. 2.4x More Cars Sold* (*than previous campaign). As a result, Lexus overtook Audi to gain the third highest market share in luxury car market. The campaign created a massive impact for small businesses, with over 30 million impressions generated.