Taken from Chrysler's 2009-2014 annual reports
Taken from Chrysler's 2009-2014 annual reports

Previously, we covered the story element of plot and how it relates to corporate storytelling by using GM and its current CEO, Mary Barra, as an example. In this post, we’ll explain the method of storytelling through emotional structure and use the example of Chrysler to show how powerful, emotionally-structured storytelling can result in increased sales, profitability, and increased market share.

To begin with, this chart which uses data from Chrysler’s annual reports demonstrates the significant growth the company has had in worldwide vehicle sales and net revenue over the past 5 years—growth which has occurred in a trying economic climate and within a troubled industry.

Although they made numerous changes that contributed to these results, for the purpose of this post, we’re only exploring the various stories they created that resonated with American audiences.

The Backstory

Since it's been a while, here's a refresher of some key Chrysler events that happened in 2009 (taken from Reuters.com):

  • Jan. 2, 2009 - Chrysler receives initial government loan of $4 billion.
  • April 21 - Chrysler has access to another $500 million from U.S. government.
  • April 30 - Chrysler files for  Chapter 11 bankruptcy (debt-restructure); Chrysler and Fiat reach agreement for merger.
  • June 10 - Completion of takeover by Fiat with the company's CEO Sergio Marchionne taking over Chrysler.

That same year, Chrysler released it's first post-acquisition annual report which covered the previous 6 months. Chrysler noted the following as its 5 year plan:

  • Sales volume increased to 2.8 million cars in 2014 (an increase of 40% over 2008 sales)
  • Annual net revenue of $68 billion by 2014
  • Operating profit of $5 billion
  • Full repayment of UST and EDC (Canadian) loans

Previously, we discussed how events that happen outside a company or character are plot elements. These events are unpredictable and unavoidable. For Chrysler, one such event is the economic collapse of 2008. Compounded with a surge in unemployment came a lack of access to credit for many companies and individuals. People were unable to buy new cars, and there was no indication of how long the recession would last. This uncertainty created a negative buying environment. These events had nothing to do with the company, but if Chrysler didn’t make the right choices, it would cease to exist.

Referencing the timeline above, you can see some of the choices Chrysler made (the most notable of which are filing for bankruptcy, taking loans from both the US and Canada, and selling to Fiat). These choices were made in reaction to external events. Although the events themselves are plot elements, the choices made in reaction to those events make up the emotional structure of any story.

In storytelling, events can be important, but it’s the choices that the character makes that creates story. And for each choice made, there are additional events that happen creating a ripple effect of more choices to be made by the company.

When it comes to Chrysler, the choices they made in 2009 created even more problems:

  • Chrysler received a bail-out from the U.S. which contributed to a tripling of the U.S. deficit. Americans were out of work and upset that the government seemed to favor the interests of corporations over individuals.
  • After receiving the U.S. bail-out, Chrysler then sold to Fiat, an Italian company—which means American tax dollars had been used to support a company which was later owned by a foreign company.

To further compound the problems they were facing, Chrysler faced negative public sentiment regarding multiple recalls, one of which was a similar situation to GM's much-publicized recent fiasco:  Chrysler's 2011 faulty ignition switch recall. 

As unhappy as Americans were with the auto manufacturers who took bailouts, Chrysler needed to make a bold move to ensure its survival. None of the old stories would work. Americans had no faith in the company. Those who could buy new cars had dealers fighting to give them the best deal, so choices were not limited. And with the economic constraints, people were even more conscious than ever of fuel efficiency.

Rather than focusing on price, quality, or efficiency, Chrysler decided to focus on something else: American strength in the face of adversity by linking the audience to something also linked to Chrysler: Detroit.

How’d they do it?

Starting in 2010, Marchionne made a bold move: Engaging Eminem to use one of his songs in Chrysler’s first-ever Super Bowl ad (to advertise the new Chrysler 200 series of vehicles). Although Eminem had been offered millions to use his songs in advertising, he’d consistently refused; however, after reading the commercial script, Eminem eventually agreed not only to allow use of the music, but he also agreed to appear in the video (for a fraction of what he'd been offered by other companies).

What were they pitching that meant so much to him?

Pride in his long-suffering hometown, love of its people, knowledge of its beauty and history, and most importantly, belief in Detroit’s possible revitalization.

According to AOL Money & FinanceJoel Martin, "who controls the Eminem music catalog and has one-third of the writing credit on [Lose Yourself]," stated,  "The script they showed us was like nothing I had ever seen before...and [Eminem] felt the same way."

Chrysler execs struck a chord with Eminem, and that was the same chord they struck with viewers who saw its 2 minute long ad.

AOL Money & Financereported the following results:

  • Chrysler 200 was "the number two search term on Super Bowl Sunday on Google."
  • "Search traffic for the Chrysler 200 on AOL Autos was 685 percent higher than normal on Monday."
  • Responders to an Automotive News poll overwhelmingly ranked the Chrysler ad as #1 "with more than 40 percent choosing it by Tuesday after the game."

Watch the ad here:

Official Chrysler Eminem Super Bowl Commercial

Did it work?

Currently, the video has almost 17 million views on YouTube, but did the positive reaction from audiences correlate to an increase in sales?

Judge for yourself (data provided from Chrysler's 2010 annual report and 2011 annual report):

  • In 2010, net revenue was $41.9 billion.
  • In 2011 (the year of the Super Bowl ad), Chrysler experienced a 43% increase in U.S. retail sales, and full year profit more than doubled to $2 billion.
  • In 2011, net revenue increased 31% over 2010 to $55 billion.

But, the proof that Chrysler believed its success was attributed to its first-ever Super Bowl ad was its continued investment in Super Bowl ads. The tagline for the 2011 ad was “Imported from Detroit.” For its 2012 ad, Chrysler decided to tell a different story, using Clint Eastwood to talk about difficult come-backs and "fighting spirits" with the tagline “Half Time in America.” Although criticized by conservatives as being a thinly-veiled endorsement of Obama winning re-election, the ad makes more sense in the context of Chrysler’s time period for repayment of its loans.

Keep in mind that Chrysler committed to repaying its US loan within 5 years. The “Half Time in America” ad of 2012 corresponded to the halfway period of that commitment. It was Chrysler’s way of reassuring the public that it was aware of its commitment and was fighting to make a come-back.

Did it work? (data provided from Chrysler's 2012 annual report)

  • U.S. market share increased 10.5% from 2011 to 2012 to 11.2%.
  • Operating profit increased 47% to $2.9 billion.
  • Net income increased more than eight fold to $1.7 billion.
  • Net revenue reached $65.8 billion—close to Chrysler’s 2009 stated goal of $68 billion by 2014.

Watch the ad here:

Chrysler "It's Half Time" Eastwood Commercial

In 2013, Chrysler decided to change stories once again by re-focusing on specific brand lines. The ad that captured the public sentiment this time was its Ram Farmer ad which has been lauded as “the most acclaimed Super Bowl ad of all time.”

Did it work? (data provided from Chrysler's 2013 annual report)

  • 14% increase in U.S. sales from previous year.
  • Profit increased 9% to $3.2 billion.
  • Adjusted net income increased 9% to $1.8 billion.

Watch the ad here:

Official Ram Truck's Super Bowl Commercial "Farmer"

And then Chrysler changed its story once more for its 2014 Super Bowl ad which featured Bob Dylan. This ad moved from the nostalgic Americana approach to one of American industry getting back to its automotive-making roots. Although Chrysler has only reported its Q1 results to date, the results are impressive:

  • Adjusted net income of $486 million (up from $166 million of prior year)
  • 23% increase of net revenue to $19 billion (over prior year)
  • 35% increase in profit from previous year
  • 19% increase in U.S. retail sales
  • U.S. market share of 12.5%

Watch the ad here:

Official Chrysler and Bob Dylan Super Bowl Commercial 2014

Although many have criticized these ads as shameless ploys to win the hearts of Americans, it’s clear that Chrysler’s storytelling since the bankruptcy and buyout in 2009 has been working.

Stated succinctly by one Allpar.com commenter, Tony M., “Maybe people won't run right out to their local CJDR dealer and plunk down $30k on a new ride, that's fine. Maybe it takes six months. Maybe a year. Maybe two years. Any and all advertising Chrysler is doing right now is to fight perception...They're selling to…[those] who [think] it was improper to bail them out, who thinks every Toyota is superior, who thinks American companies don't build good cars. That's the point of the ad.”

Like any troubled protagonist, Chrysler’s faced challenges, both internal and external, and with their powerful storytelling, they’re showing Americans that they can be stronger. Whether by drawing an analogy between the tough circumstances faced by the company and the American people or the pride we take in our country, Chrysler has successfully changed the perception of its audience, resulting in increased sales and profitability.

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