Lincoln Hopes to Boost Ford Motor Company (F)’s Stock Value

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Ford Motor Company (NYSE:F)The financial crisis and ensuing recession caused a lot of pain for Detroit’s Big Three automakers, Ford Motor Company (NYSE:F)General Motors Company (NYSE:GM) and Chrysler. Inefficient operations, massive incentives, and drastic declines in sales ended in two bankruptcies – with Ford the lone survivor – and a huge cash crunch. The companies are still feeling some of the after effects of the cash crunch; it’s a big reason General Motors Company (NYSE:GM) has the oldest vehicle lineups in the industry. With a limited amount of cash, redesigning and developing vehicles was very limited for all three automakers, and is also the reason Ford Motor Company (NYSE:F)’s Lincoln brand was left for dead.

Finally Ford Motor Company (NYSE:F) is able to spend some cash to help revive its Lincoln brand – which will be an important development for the company and its investors. How will Lincoln create a valuable product, generate consumer demand, and top it off with better service?

Lincoln tumbles
Believe it or not Lincoln was the top-selling U.S. luxury brand in 1998, riding on the success of its Navigator. Since that high note, the only thing the brand has consistently done is tumble in sales. Last year Lincoln sold just over 82,000 vehicles – less than the Mustang sold by itself – and only enough to rank as the eighth-best luxury brand.

One of the first lessons I learned from a former chief marketing officer colleague was how important it is to create pull-through. You can create the best product in the world, but if you don’t create demand and a call to action, then the buyers will never pull the trigger.

Lincoln is attacking this issue in a couple different ways. First, it’s creating consumer demand through yet another advertising campaign, on which it’s spent over a billion dollars. This past February’s Super Bowl ad wasn’t a home run by any means, but whatever demand it generated fell on deaf ears because models of the MKZ weren’t available until months later.

In addition to pressing the reset button on its advertising and marketing, Lincoln is sharpening its focus on a different consumer – a younger, well-educated, and wealthier consumer. Lincoln is even training its salespeople, through a Lincoln Academy, on how to talk the talk with its new target audience. This training is aimed at what Lincoln executives see as an opportunity – to improve service and the shopping experience. Lincoln wants a more premium feel for a more sophisticated buyer and thinks that its competitors aren’t hitting that mark.

While those tactics will help create the necessary pull-through demand, for Lincoln’s ambitious comeback to reach fruition, it’ll need vehicles that walk the walk. As you can see below, the MKZ was a much needed redesign and is helping push the entire brand higher. It’s merely the first of four steps to come over the next four years.

Lincoln’s next step is to enter another fast-growing segment: premium crossover. It debuted the Lincoln MKC this year in Detroit at the North American International Auto Show to enter this segment. It’s not a fluke that these two luxury segments were the first ones attacked by Lincoln; in the standard versions, the Fusion and the Escape have set record sales months for most of the year.

Lincoln’s MKC concept vehicle

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