Toyota the chip leader

If you play poker, you know what “chip leader” means. If you don’t, it’s the player with the biggest stack of chips. Which means the player who has the most money on the table. As such, the chip leader has the luxury of pulling off stunts a player with dwindling resources won’t even entertain in his thoughts. The chip leader, for instance, can “go all in” — bet all his chips, in other words — even with a bad hand because he knows the others won’t call his bluff unless they have really solid cards. A trifling sum to him may be an entire pot to another.

You get the point.

In the Philippine car industry, Toyota is the chip leader. That’s what owning a huge slice of the market affords you. Last year, the Japanese automaker sold 61,222 passenger cars and 97,506 commercial vehicles for a grand total of 158,728 units. That translated to a 39.5% market share. Mentally crunch these numbers if that’s your thing. For every five vehicles purchased by Filipinos, two are stamped with the Toyota badge.

That kind of sales supremacy usually comes with a gargantuan war chest. You know, the funds at your disposal while you perform hostilities toward the competition. Or a business organization’s marketing budget, to be specific. To sell your products, you need to promote them. You need to build your brand. You need to establish ties with channels that can help you get your message across. And these things can set you back a fortune. Safe to say that the stronger the sales, the deeper the marketing wherewithal.

We can all only imagine what Toyota Motor Philippines’ annual marketing capital is. (Well, I tried asking, but my contacts politely declined to divulge the figure.) There are assumptions, there are rumors, there are estimates. But just to give you a sense of how immense the amount must be, let’s just say executives from rival companies constantly marvel at the sort of events and campaigns Toyota puts together on a regular basis just to reach out to customers.

“I could do so much more if I had that much budget,” a marketing director from another automaker tells me, shaking his head and taking a quick swig of his single malt.

“When you’re marketing with only a tenth of what Toyota gets to spend, you need to be more creative and more prudent,” says another, also from a different car company. “You can’t afford to advertise out of pure goodwill, for instance. Every peso has to count.”

But when you’re the chip leader, you can let even the proverbial chips fall where they may. That’s not to say Toyota’s marketing team isn’t doing a good job of managing that war chest. But they do have a lot of flexibility and definitely a sizable room for error in hitting their targets. Another brand’s major production, exhausting a third of its 12-month reservoir, could be a mere pocket event for Toyota, hardly registering a blip on the marketing department’s fiscal radar.

Take the Vios Cup, a one-make race series featuring Toyota’s best-selling subcompact sedan. Costing a whopping P100 million per season — P25 million per race weekend — this project is a dream concept other auto brands can only fantasize about. In a country where multiple groups struggle to mount just one successful race even with joint resources and efforts, the Vios Cup shows what single-mindedness and determination can achieve. Although, of course, lotto-like funding goes a long, long way in ensuring that all concerned — from well-paid suppliers to pampered celebrities — work toward a common goal.

The Vios Cup was introduced in 2014, shortly after the arrival of the third-generation Vios in our market. It has select Toyota dealerships fielding a pair of drivers each, with privateers and celebrities filling the starting grids of several categories, grouped depending on individual driving skills. Journalists used to participate free of charge — until Toyota probably realized they were bending too many fenders.

In previous years, races were held alternately on racetracks and makeshift street circuits. This year, the series has been mostly confined within the safe barriers of Clark International Speedway. Toyota provides free hotel rooms to cherished guests (mostly members of the media, with their families in tow) just so they’ll watch the race inside an air-conditioned VIP tent and listen to a mostly hysterical commentary.

Save for the drivers’ relatives and friends, spectator attendance remains underwhelming. Which is a pity, because the Vios Cup is superbly organized. From the excellently liveried cars to the high-grade racing suits, from the professional pit garages to the neat smoking areas, this event is first-rate. Even Toyota peeps from other countries visit and observe to learn how to run a similar series in their respective territories. But for some reason, audience turnout has been less than spectacular.

Maybe it’s the distance. A leg held in Alabang last year was packed, after all. And so these days Toyota has been relying on online videos to bring the action to more eyeballs glued to phones and tablets. A Facebook video of the race posted to the company’s official page attracts anywhere from 50,000 to 120,000 viewers. Not bad. But still unremarkable when you consider the staggering expenses.

But like I said, Toyota is the chip leader. The chip leader sometimes does things just because he can. A Toyota marketing officer admits to me that the Vios Cup, based on their findings, “doesn’t really correlate with the Vios’s sales performance” — that the car “will sell even without a racing series to promote it” — but also notes that the campaign serves as a brand-building initiative.

Well, for a locally manufactured car that has gone from selling just 6,700 units in 2004, to an eye-popping 36,256 units in 2016 — plus a record one-month tally of 3,666 units in May this year — maybe a racing series is exactly what’s needed to tickle everyone’s inner driver in a time when most people just want to ride Grab or Uber.

Is the Vios Cup worth keeping? Who cares? Toyota has all the chips.

You may e-mail the author at vbsarne@visor.ph.