I understand you also do a lot of focus groups with regards to design and coming up with design, getting feedback from consumers. Are you intentionally looking at younger people to be part of those focus groups?
Butler: We do extensive research. Not so much to the point that we are kind of antiseptic and clinical about it. Because at a certain point, you’ve got to let intuition and emotion kind of weigh in, particularly when you’re talking design. You want to lead. It’s the Wayne Gretzky analogy. You don’t want to go where the puck is. You want to go where the puck will be. So to some extent, you have to understand and interpret the feedback that you get from consumers. If they say, oh wow, that looks like a reach. Well, is that a reach that will become fresh at a certain point in time? Or is that a reach that you’re reaching and you aren’t going to get anywhere with that because it’s still going to be out on the fringes?
So, we have to be careful to interpret what we get back from the research. But we have two groups. One group that we call young adult males, or YAMs, [are] under 30. We intentionally recruit on that basis. And we recruit also based on competitive ownership—so, those owning BMW 3 series, for instance. We bring them into our clinics. We also have a group that we call YAFs, young affluent females. We do two different groups, male and female because—particularly when you’re in a focus group setting—you want to make sure that one group doesn’t dominate the conversation. You want to make sure you get all the views that are aired. Then there’s certain things that come out when you have like-minded people sitting around the table.
Some of these interviews are conducted in the subject’s homes. Why is that?
Within focus groups, you have to be careful of group thinking and the setting that you’re in, and then how that would influence the information that you receive. So, we spend a fair amount of time literally at people’s homes—two, three hours. They talk about their lives. They talk about what they do. They talk about how their home fits into their life. They talk about how their car fits into their life. They talk about style and their clothing and their furniture. We really go in-depth. You have to be careful the people that you pick because you want them to be representative of a broader population. But the depth that you’re able to get to and how relaxed people are in that environment, you get really, really keen insights that you wouldn’t get otherwise.
The Cadillac ATS was introduced to the media a few days ago. Who are you trying to reach with that vehicle?
Butler: In some ways, you could say the ATS is our most important launch in decades. ATS represents for us our first truly credibly entry in the largest luxury segment, both in the US and in the world. Compact luxury is the largest luxury segment. Within the US, over 370,000 units are sold. So for us not to have a presence there, it’s a huge handicap. It’s a huge handicap from a volume and image standpoint. With ATS, [it's] an all-new, fresh, bold step for Cadillac into a territory that quite frankly we haven’t been in before. These are also the youngest buyers within the luxury segment. These are, for the most part, people just entering luxury, just deciding to use that form of expression for themselves.
The other thing with ATS is it is our most direct, head to head competitor with some of the key luxury makes. BMW and Mercedes, for instance. The 3 Series, C Class. This vehicle will go head to head right on with those vehicles. CTS has been more of a bridge between a three and a five or between an C and an E. So, now with ATS, we are directly targeting our main competition. We’re doing it, we believe, with a bold statement for Cadillac. So, it represents a volume opportunity and it also represents and image opportunity for Cadillac.