By Patrick Coffee
Electric-vehicle startup Rivian Automotive this month named Jennifer Prenner as vice president of marketing. She becomes the company's senior-most executive devoted to marketing.
Prenner formerly led product marketing for Meta Platforms' Reality Labs division, which includes its virtual-reality, augmented-reality and metaverse products, and was global head of marketing, growth and customer engagement for Amazon.com's Fire TV streaming product. In her new role, she will report to Chief Commercial Officer Kjell Gruner, who was previously chief executive of automaker Porsche Cars' North American operations and chief marketing officer for the Porsche brand.
Prenner's hire comes at an important time for the maker of electric trucks and SUVs, which on March 7 will begin unveiling its R2 line of economy vehicles and start taking reservations. The first R2 is expected to go on sale in 2026 with a likely price range of $40,000 to $60,000, according to a Rivian spokeswoman, well under the cost of Rivian's R1T truck.
The broader EV market meanwhile has run into an unexpected cooling in demand from consumers.
The R2 rollout will be the primary driver of Rivian's attempts to reach profitability, said Barclays analyst Dan Levy. Marketing will play a key role as Rivian looks to attract consumers who are not dedicated EV enthusiasts but may consider the brand because of its reputation, he said.
"This is what Tesla did: You start with the premium vehicle to create a brand halo. Once you establish the brand DNA and the brand following, you create a second model that is smaller, has less content but carries that DNA," said Levy.
A teaser video released last week to promote the R2 unveiling focuses on the idea of adventure, which has been key to many of Rivian's recent marketing efforts.
The R2 teaser video's emotional appeal and family-focused imagery position Rivian as a lifestyle brand, said Bernd Schmitt, professor of international business in Columbia Business School's marketing division. There's little focus on the product itself, he said.
Rivian has carved out a niche as a maker of larger electric vehicles, but will eventually need to broaden its appeal to reach new audiences, said Schmitt.
Rivian has so far spent very little on paid media, according to Ace Metrix, a unit of TV ad measurement firm iSpot. The company previously developed content marketing campaigns such as "Electrifying the Outdoors, " a collaboration with auto media company MotorTrend Group in which drivers traveled cross-country in the R1T pickup.
To market to the public at large, EV makers must justify higher costs by demonstrating their products' usefulness in consumers' everyday lives, said Mark Wakefield, co-leader of the global automotive and industrials practice at consulting firm AlixPartners.
The goal is to create the perception of benefits that competitors can't deliver, then reach further audiences through word-of-mouth, Wakefield said.
"The wealthy mom in the carpool line, the tech-savvy guy at the golf club. These are the types of people you want talking about your product, " he said.
Rivian is well-positioned in the long term thanks to the quality of its products, said Levy, the Barclays analyst. Factors such as decreases in the amount of time consumers may spend on waiting lists for Rivian vehicles, however, hint at softening demand, he said. Barclays last week downgraded Rivian's stock in a note written by Levy that cited pressure across the EV market.
Rivian also recently joined other EV automakers in lowering its prices to address slower-than-expected sales growth in the sector. The company beat its own delivery estimates for 2023, but still loses thousands of dollars on every model sold. Executives have said Rivian plans to break even at the gross level, which excludes company overheads, by the end of 2024.
Rivian's November 2021 initial public offering was the largest to hit the U.S. market in several years, with the company valued at approximately $86 billion. Its stock price has since dropped by more than 80%.
The Irvine, Calif.-based company is scheduled to report its latest earnings on Wednesday.
Write to Patrick Coffee at patrick.coffee@wsj.com
(END) Dow Jones Newswires
February 20, 2024 15:23 ET (20:23 GMT)
Copyright (c) 2024 Dow Jones & Company, Inc.
Comments