Another money maker for a branding agency

Apparently Hyundai is aiming to move the brand to a new position of “modern premium.” That would be a phrase their agency made up. The problem is that they also want to keep making a wide range of vehicles from low-cost to higher priced. The Koreans may be obsessed with creating a higher end image and their U.S. brand agency may be feeding that delusion.

Nissan (Datsun) and Toyota both recognized that they could not brand extend successfully in that way. (Alfred Sloan understood that almost 100 years ago.) Thus they created Lexus and Infiniti, two successful brands while maintaining strong positions with their original brands. What outcome could Hyundai possibly expect from this effort (other than enriching their brand agency)?

There is some discussion that this may be a prelude to introducing an “upscale” brand like Lexus or Infiniti. If that’s the case, there is no need to reposition or brand extend the core Hyundai brand. And if they do create some “modern premium” position in the mind of consumers, how will they do that without scrapping a bunch of the lower-end cars in their line?

Brand extensions almost never work for anyone except the brand agency paid to try.


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