Hyundai Motor America Inc.’s Angela Zepeda is leading the automaker’s efforts to project a louder corporate voice, and develop a marketing strategy that emphasizes more than a nuts-and-bolts engineering story.
It’s a change of gears for the Fountain Valley-based auto giant, and the result of a new corporate strategy set out by CEO José Muñoz. It’s also a reaction to timing and world events, as well as Hyundai’s positioning in the competitive automotive industry.
Zepeda, who previously served as senior vice president and managing director at Hyundai agency of record Innocean USA of Huntington Beach, joined the automaker in October to succeed Dean Evans.
“I came in as the CMO at Hyundai probably at the most—well, it seemed at the moment, the most perfect time maybe in Hyundai’s history, at least here in the U.S.
“We had been waiting for several years to really expand our portfolio with product that the market really wanted,” she said.
Zepeda is talking about the SUV and crossover vehicles, noting Hyundai was trailing competitors in that department in terms of offerings in a product type increasingly in demand from consumers.
That changed last year with the addition of the Palisade, a higher-end, three-row SUV starting around $32,000 that was seen as solidifying the brand’s vehicle lineup. It sold nearly 29,000 Palisades in 2019— out of the total 688,771 vehicles Hyundai Motor America sold last year—and another 36,455 Palisades in the first half of this year.
“We were really ready to attack the market with a lot of confidence, because we had a lot of those pieces put together that really made us strong competitors, along with incredible design safety and technology that’s best in class,” she said, as she readied a marketing playbook that was about making new fans for Hyundai.
“We really had the opportunity to do that, and that’s been the goal, and still will remain the goal moving forward—in spite of what’s happened with the pandemic.
“We’re not taking our eye off the long-term goal.”
Pandemic Pivot
Still, things changed, not surprisingly, earlier this year, Zepeda said.
As Hyundai notched strong performances in January and February, executives saw “trouble brewing with COVID-19,” she said as they looked to what was happening with colleagues at global headquarters in South Korea.
Hyundai’s domestic team, in response, retooled and then relaunched in March its Assurance Job Loss Protection program, which had last been utilized during the Great Recesssion.
By April, Hyundai was focused on humanitarian efforts, helping bring more coronavirus testing to the U.S. It has donated $4.4 million to COVID testing centers domestically; Muñoz was a Business Journal OC 50 “50 making a difference” recipient in May for his leadership efforts at the outset of the pandemic.
The automaker soon pressed the importance of its digital marketing tools for dealers, which had been available pre-COVID but not utilized by all.
Today, there’s been 100% buy-in on the digital retailing capabilities by dealers, according to Zepeda.
“It’s funny in times of crisis, new behaviors take place to adapt to a changing marketplace,” Zepeda said.
Dollar Drop
Meanwhile, the actual dollars going to Zepeda’s department shrank.
“It got tougher and tougher because the pandemic still continued and we were mostly focused on keeping our company fiscally whole, including our dealers,” she said. “So, we made the choice to really [dial] back our marketing investment to help with our overall Q2 business objectives and goals.”
Industry reports estimate Hyundai typically budgets in the neighborhood of $300 million a year on ad spending alone.
While spend in the digital channel had been a focus pre-pandemic for Hyundai, it captured a higher percentage of spend in the April-June period just on account of broadcast spending contracting to match demand.
But Zepeda maintained Hyundai’s ad spend will always touch across different marketing channels to capture consumers from the time they even begin thinking about a new car and across the possible several years it may be before there’s an actual purchase.
“The events of the last few months have certainly impacted our business, but with the support of our dealers Hyundai has adapted quickly,” Muñoz told the Business Journal in June. “Thanks to our global leadership in Korea, we were given maximum flexibility to incentivize our dealers and customers during this unforeseen decline in the market due to COVID-19. We launched the Assurance Job Loss Protection program within 24 hours and collaborated with our dealers to ensure they had the best tools to conduct more business digitally and remotely. Our efforts have paid off.”
‘Back to Business’
While total sales have continued to be dragged down by the fall off in the fleet segment, the CEO touted the growth in the retail sales channel (that’s direct sales to customers) in May and June as being a positive indicator for the business, despite the headwinds.
“We’ve been lucky. I’ll knock on some wood,” Zepeda said. “As we moved into the summer thinking we would really get back to normal, the new normal is that it’s not normal.
“We need to get back to business. It’s important to keep people employed and keep [the] industry moving, but we are sensitive that there are markets under duress and will have more issues with government mandates, but we’re getting used to it.”
Marketing Refocus
There’s a focus now back on the vehicle lineup and launches, such as the new Elantra, a compact sedan whose prior models started around $20,000, in October; and Santa Fe, a compact SUV that’s been priced in prior models around $26,000, in December.
There are also lessons being learned from the period people and industry are still collectively living through: a pandemic and social justice movement.
“I have to say, I felt like I’ve taken a lot of notes, to be honest, during this because there was no playbook really,” Zepeda said.
“We have incredible leadership now … I think we’ve been calm. No one freaked out. I think we just were trying to be as smart as we could be with as much information as we gathered and we make decisions as a team because nobody knows what are the right moves.”
Zepeda applauded Muñoz’s leadership in navigating the unprecedented time, and said the CEO, who took over in mid-2019, is preparing for a greater reliance on marketing moving forward, to create a stronger voice for the Hyundai brand.
“His leadership gave all of us the confidence that we were moving in the right direction,” she said.
“We have not always been a marketing-led organization. I think I’m OK with saying that out loud, but it’s true. It’s been much more engineering-led than anything else and that’s heritage. I also think it’s time to put marketing at the forefront and José’s been a big fan of marketing.”
Tomorrow’s Here
Looking to the experience of the Great Recession may have helped in some ways navigating the current environment, Zepeda said, but it is still a completely different time from today.
In the case of the protesting that erupted from the death of George Floyd, Zepeda said it was about making sure Hyundai employees felt supported and there were programs in place that spoke to that stance.
As a CMO, Zepeda said, it was also about allocating dedicated funds and resources for African-American and Hispanic efforts, such as funding and hiring agencies to support those communities.
In the past, the spend had previously been mixed with general marketing.
“In times of really bad things and sad things happening, it does force you to finally make decisions [that] you had just put it off and [said ‘I’ll] deal with that tomorrow.’
“Well, tomorrow came.”
