Everyone's heard of Ferrari. But in the early 1990s the company lost sales to high-ticket competitors. Italian executive Gian Luigi Longinotti-Buitoni, CEO of Ferrari North America, reenergized the company's powerful family name.
He shares his ideas on what brands mean in a new book called "Selling Dreams: How to make any product irresistible." The Monitor's Eric Evarts buttonholed Mr. Longinotti-Buitoni at the opening of a Ferrari dealership in Newton, Mass., to get his thoughts on fulfilling consumers' dreams.
Today the critical path is to establish a link with the dreams of the customers.
"I make a distinction between what a consumer is and what a customer is. The consumer is a statistic, somebody who uses a product to satisfy their needs. The customer is somebody who really appreciates the product, and always remembers the emotion the product has given them.
"Companies have to realize that they're not selling products, they're selling an experience. A customer may go to a jeweler to buy a crown. But the jeweler has to understand that the dream of the customer is not to own a crown, it's to become a king.
"Therefore you have to create that experience.
"That's why it's so important for companies to constantly be extremely creative. You constantly have to renew yourself. I think that creativity is the most squandered resource on Earth and the most important one. Today you have to work more like an artist than a rational business person.
"Just by constantly following and constantly listening, [an artist] develops such an intense perception of the market that he's able to see in the future.
"I think the first thing is to really understand what are the leading dreams in a certain period. When you think about cars, the leading dream is freedom. Ferrari's brand is so strong since the company was always true to itself. Whenever somebody thinks Ferrari they think racing.
"Therefore it's important that every single product bring something to the brand. You have to ensure that you don't sell a Ferrari because of the name, but you sell a Ferrari because it's a very exciting automobile.
"I've had the passion for race cars since I was a kid. Whenever I have a difficult day, I just go downstairs and walk a couple of minutes in the shop and look at the Ferraris, and I get energized.
In the future you will see that there will be products that will not be able to connect. And they will become commodities, [in which] you are not willing to invest in a brand and spend more money: Milk. Water. Gasoline. It's not about fulfilling dreams there, it's about satisfying a need."
(c) Copyright 1999. The Christian Science Publishing Society