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SOCIAL MEDIA STRATEGY AND BRANDING; HOW DID ALRED STONE CREATE A SOCIAL MEDIA BRAND iN THE 1920″S

Article by Dean Hambleton

SOCIAL MEDIA STRATEGY AND BRANDING: HOW DID ALFRED SLOAN CREATE A SOCIAL MEDIA BRAND AT GM IN THE 1920’S?

Alfred Sloan, of GM, invented market segmentation and differentiation, in the 1920’s, to create a brand in the automobile market. Quickly, this brand overtook the Ford Model T, and became the leading car brand in 1920 America. At the time this happened, the Ford Model T had a market dominance that was seen to be insurmountable. Sloan was able to create his brand through the wise use of the social media that was available at the time. At this point, it is imperative that we define the word “social media”. We have to understand this term to understand how Sloan created his brand, and to draw analogies for our day. A key word is the word “media”. Media has the connotation of sharing and communicating information. A definition could be the set of Web-based broadcast technologies that enable the democratization of content. This gives people the ability to attain content from publishers, enlarge on the content, and to create new content. A key component of social media is the personal engagement between brands and customers—the creation of a friendship. Naturally, Sloan didn’t have the social media platforms that we have today to communicate. To create his brand, Sloan did communicate and engage. He went to dealerships. He talked to salespeople and to citizens. Modern marketers use social media platforms to communicate. Sloan became the social platform by which brands and customers communicated to one another. Sloan, just as we today, use platforms to learn information from customers that aid us in our creation of modern brands. This is why the Alfred Sloan should be studied by contemporary social media marketers. At the time this happened, it was thought that the Ford Model T was so dominant in the car market space that it could never be overtaken. The Model T had been around for more than a decade. In the 1920’s, in spite of that, the Model T was just coming into its own. Two thirds of all cars registered in the United States in 1923-1924 were the Ford Model T. Henry Ford had done a masterful job in creating a brand for the Model T. By the early 1920s, the Model T had attained such vivid brand recognition that nearly every prospective first-car buyer understood the distinction between an automobile and a—FORD.Ford’s branding was so masterful that it was able to position the Model T as a necessity, and not a luxury. Henry Ford was able convince people that they needed dependable, affordable transportation. The Model T was branded as the best alternative to this. In the environment that Ford and GM operated in the 1920s, there were few single purchases were above 0. At just a few hundred dollars, the Model T solved one of the most significant problems the average person had—how to get around. This created a problem for General Motors. To survive, long-term, they had to expand their market. A brand had to be created that would compete against the Model T. Alfred Sloan faced a dilemma that many modern day marketers face. He had to create a strong brand, virtually overnight. He did what modern marketers do in creating a brand. He used social media to engage customers—-Sloan’s social media is that he talked to customers. He began to notice changes in the dynamic of the market that allowed him to create a brand for GM. The tool that social media offers to a marketer is great speed. The reason why social media is so fast is because there is such huge scale. A successful marketer engages with customers. This allows a marketer to quickly grasp the subtle changes that take place that change the entire dynamic of a market. This is what social media did for Sloan, and it is what social media does for a contemporary marketer. Today, this is done through Facebook and Twitter. A marketer engages with customers through the “comment” section. Social media platforms have great scale. Contemporary marketers are able to engage with a great many customers in a short time. Facebook has 1/3 of the world at its platform. Naturally, Sloan didn’t have this scale, but he did talk to enough people to understand some trends that would allow him to create a brand that would offset the Model T. The American society was changing. It now had a middle-class with disposable income. America had a leisure class. The car was no longer just a means of transportation. People were different stages of their life and they wanted a car to communicate that. Sloan understood the importance of segmenting his market. Sloan created a brand for every pocketbook. Early in your life and your career, you originally would purchase a Chevrolet. As your career progresses, you graduated to Pontiac and Buicks. When you become successful you purchase the Cadillac. Sloan was able to grasp this subtle change through his use of his personal media. Henry Ford didn’t grasp how society was changing and this is why GM was able to quickly create its own brand that quickly overtook the Ford Model T in the 1920’s.

Dean Hambletondnhambleton@gmail.com

About the Author

Dean Hambleton is a student at Johnson and Wales University in Providence, R.I. and a free lance consultant