In secret rooms, Ford tries to outwit rivals.
Bryce G. Hoffman - The Detroit News – May 25, 2006
John T. Greilick - The Detroit News
"This room is taking it to a whole new level," says Ben Poore, Ford's truck group marketing manager, inside Operation 34.
DEARBORN - In a room that smells of musty waders, surrounded by camouflage hunting jackets and power tools, a small group of men is plotting strategy - not for catching the big one or bagging a 12-point buck, but to defend Ford Motor Co.'s leadership of the domestic pickup truck market.
"Can you smell it?" Ben Poore asks. "There's a purpose to that."
Poore, Ford's truck group marketing manager, said the purpose behind the smell and everything else in this simulacrum of your uncle's garage is maintaining a laser-like focus on the customer. It is the headquarters for Operation 34, Ford's plan to extend its 29-year leadership of the truck segment for another five years.
This is only one of a series of secret "war rooms" that have been set up in its Regents Court complex in Dearborn to encourage Ford's strategists to get outside their Detroit-centric mindset and into the heads of their customers and competitors.
The Detroit News received exclusive access to Operation 34's HQ, but Ford says it will never allow outsiders into other rooms set up to war-game rivals like Toyota Motor Corp. and General Motors Corp.
The stakes could not be higher. While Ford's share of the domestic automobile market has dwindled in recent years, its F-series pickups remain the best-selling vehicle line in the United States. But that hegemony is being threatened by Toyota, GM and others. Both Toyota and GM are releasing new full-size pickups over the next year, trucks designed to meet the F-series head-on.
"Next year, it could be the perfect storm for the F-series," said George Peterson, president of AutoPacific Inc. in California. "They're really going to have to pull out all the stops on the marketing side."
That's what Ford is trying to do with these war rooms.
"We've found it to be a very valuable exercise to try to think like our competitors," Ford spokesman Jim Cain said. "It helps us to stay at the top of our game."
Taking a page from the CIA, Ford uses each room as a clearinghouse for publicly available intelligence about each of its competitors - information about their products and customer demographics, copies of advertisements and sales reports, press clippings about marketing initiatives and technological innovations.
"From that, you war game out different scenarios," Cain said, adding that the results are shared throughout the company. They also are communicated to Mark Fields, president of Ford's Americas group, and other top executives.
Other companies have employed similar excercises to understand the competition and the customer. Ford has been developing its war rooms for a couple of years. But this effort has taken on new urgency in light of the North American restructuring drive launched by Fields after he took over the company's domestic operations last fall.
"It has required us to be very honest about where we are from a competitive standpoint," he said.
Fields challenged his employees to see the world through the eyes of their customers. Poore set up the Operation 34 truck war room in November in an effort to do just that. He worked with Fields when the latter was president of Ford of Argentina and said they set up similar rooms there to better understand the Argentine customer.
"This room is taking it to a whole new level," Poore said.
Before entering the room, visitors must read a list of ground rules that all members of the Ford truck marketing team are expected to abide by - rules like "Earplugs are not permitted at NASCAR races or Monster Jam events" and "Pink shirts are never acceptable attire." Violators are required to put a dollar in a jar for charity.
Inside, the room is decked with cans of Skoal, six-packs of Pabst Blue Ribbon and Toby Keith memorabilia. The conference table is a workbench supported by sawhorses and flanked with Home Depot stools. Its centerpiece is a coffee can full of peanuts. The place is such a mess of props and peanut shells that the building's custodians stopped cleaning it.
The truck team holds its meetings in this room. Advertising campaigns are approved here. Pricing and incentives are set here. A few product decisions have even been made beneath the glare of the spotlights that dangle on orange extension cords from the ceiling.
Shrines to Joe and Cal
One wall is devoted to the truck division's two target customers: "Joe" and "Cal." Joe is the F-150 man, Cal his Super Duty soul mate.
Poore and his team have assembled shrines to both archetypes.
Joe's side of the wall is hung with small tools, leather work gloves, fishing tackle and hunting gear.
Cal's is decorated with construction equipment, sacks of cattle feed and a Thermos.
Both are hardworking men, but there are differences. Joe has Craftsman tools, while Cal uses DeWalt. Joe is the guy you call to help you finish your basement; Cal is the guy who built your house. Poore says those differences are important, because they are how Ford separates the two sides of the F-series line - the regular full-size pickups and heavy duty work trucks.
But Cal and Joe share common interests and common values, and two more walls are devoted to those areas of convergence. They are plastered with promotional posters for bull-riding competitions and monster truck events, copies of North American Fisherman and Wood magazine, fishing lures and spent rifle shells.
"They're distinct customers, but they both live, eat and sleep in the same places," Poore said. "We then target them in those areas."
Those areas include places like Cabela's and Home Depot, Monster Jam and NASCAR, rodeos and country music concerts. Ford has aggressively pursued sponsorships and marketing alliances with all of these, each aimed at promoting the F-series pickup.
While all of this may appear heavily weighted toward a certain white male demographic, Ford says the same core qualities attract their Latino and African-American customers, as well. However, the company approaches each ethnic group a little differently. In marketing to African-Americans, for example, it emphasizes Joe's do-it-yourself side instead of his bow-hunting side.
Girding for battle
The final wall - concealed behind Ford banners for the visit from The News - is devoted to the company's future truck strategy.
While Poore will not discuss the details, he says it comes down to what the room is all about
: figuring out what the customer wants and giving it to them.
"We've stuck with the same target customer year after year after year. That's one of the reasons why we've been so successful," Poore said. "We know what they want."
But Poore also knows the game is about to get a lot more competitive - particularly once Toyota's new, Texas-built Tundra hits showroom floors in January.
Poore is putting on a brave face. He says the introduction of Toyota's first true full-size pickup will help expand the market for big trucks, rather than taking sales away from Ford. That is what happened when Dodge made its big push in 1994 into a segment that had long been carved up between Ford and Chevrolet, and it is what happened when Nissan Motor Co. joined the fray in 2003.
"Our sales just kept going," Poore said. That is because Ford's F-series is the most cross-shopped vehicle in the business. "Whenever anybody looks at another truck, they look at mine, too. It gives us a shot at going after them."
Toyota does not disagree with that analysis.
"We may well grow the market," Toyota spokesman Xavier Dominicis said. "Most of our initial sales will come from existing Toyota customers."
Dominicis said Toyota does not use role-playing rooms like those in Ford's Regents Court to plot its truck strategy, relying instead on what he called "internal yardsticks."
But AutoPacific's Peterson said those rooms may be just what Ford needs to fend off Toyota's threat. The visceral customer experience offered by the Operation 34 room is a good antidote to the parochial worldview that too often hamstrings domestic automakers, he said.
"What they really have to do is get into the other guy's head and figure out what they're going to do," Peterson said. "This does make sense. It's not a waste of time. You really have to have your strategy dialed in."
Ford says it is not going to give any ground in this fight for truck supremacy. Fields recently made a public promise to sell at least 900,000 F-series pickups this year. If he can deliver on that pledge, 2006 will be the third consecutive year Ford has passed that milestone.
"We're going to significantly raise the bar again in the very near future," Poore promised. "I'm concentrating on playing offense and playing to win."
Assuming, of course, that he does not violate Rule No. 18: "No 'froo-froo' coffee drinks."