If Obama’s presidential campaign has anything to teach business, it’s the about the power of the personal brand. Political beliefs don’t win elections; people do, which is something every astute politician understands. So while the American public may have been ready for a Democrat to take up a term in office again, it was the man, not the political party that swung people’s votes. What Obama did right was to use his name and personal values as a platform, and to create a brand that resonated with people on a personal level. He gave them a personal touchstone they could relate to and believe in.
It’s not a new recipe for success, in either politics or business, but it is a powerful one. Nelson Mandela and Richard Branson are prime examples of people who’ve used it particularly well. And on a less grandiose scale it’s what Arnold Chatz, South African entrepreneur, motor racing driver and self-confessed ‘car nut’ built a business on. Over a career that spanned more than 40 years, he built a reputation and personal brand that still stands today. It’s weathered massive changes to the motor manufacturing industry, the arrival and departure of various brands to and from the country, amalgamation into a large listed corporate and finally the buy-out and re-establishment as an independent business. What have remained constant are the brand attributes and ability to deliver on the brand promise. Now retired, Chatz looks back on what’s made him most proud. “What’s important to me, and I think I can speak with a fair degree of confidence on this, is that I enjoyed a good reputation. I doubt if there are many people who would say they ever had a conflict with me. In my 42 years of active business in the motor industry, I never once briefed an attorney. I would rather not do a deal than risk losing my reputation,” he says.
That reputation – or personal brand – was built on two core factors: genuine passion and an understanding of how to treat customers.
“But it all started with passion,” says Chatz, “I was absolutely besotted with cars. I loved everything about them. I overhauled the engine of my mother’s car when I was just 15. I suppose it was an innate thing, but I always knew it was what I wanted to follow.” After he matriculated, Chatz joined a finance company run by family friends in Krugersdorp. “Being a finance company, they had repossessions which they needed to sell. They knew about finance and I knew about cars, so I started off with them in a used car operation,” he says. With his eye ever on the motor industry, Chatz noticed a new arrival to the South African commercial vehicle market while working in the used car business. “Datsun, which was the predecessor of Nissan, brought out this little Japanese vehicle that could carry a ton. Compared to the American ¼ ton vehicles, it was so small, and I was so impressed with it that I called up the importer of the vehicles and asked if I could have the franchise. He said yes, I bought four vehicles and sold them within two to three days. Within six months, we were selling 40 units a month. That little car turned out to be the first really big-volume Japanese vehicle. It just took off,” he relates.
At the same time, Chatz was pursuing his personal passion for motor racing. “I was a racing enthusiast and had got involved with a friend of mine, Basil van Rooyen, as his assistant spanner man. He asked me if I’d like to drive a race or two with him and use his car in one or two club events so I started racing,” he explains. By 1961 Chatz had been noticed by the Lawson Motor Group, which had acquired the Renault agency for Johannesburg and offered to sponsor the running of his vehicle if he raced one of their cars. A year later, Chatz applied for and was granted the Alfa Romeo dealership and handled both brands at the Krugersdorp branch. It was the beginning of a lifelong love affair with the Alfa Romeo brand. In 1968 the company approached him to be their works racing driver and a year later he was granted the dealership for the Johannesburg northern suburbs area. “We were selling a lot of vehicles into Johannesburg from our Krugersdorp branch, and when one of their dealers defaulted and the opportunity opened up for me to expand, I jumped at it,” says Chatz.
The net effect of this brand association was that Arnold Chatz built a reputation, in racing and in business, as ‘the Alfa Romeo man’. “People still remember me as the guy who raced and sold Alfa Romeos. Today they still come up to me and tell me that,” he says.
The fit was a natural one. Alfa Romeo was a niche brand that appealed to motoring enthusiasts, many of whom Chatz got to know on the race track. “Alfa Romeo customers liked to deal with people who knew about cars, which I did,” he said, “They knew if they didn’t find me on the showroom floor, they’d find me in the workshop.”Perhaps more than anything, it was this personal touch that appealed to Chatz’s target market. “Alfas were never a high volume seller and the people who bought them wanted special attention. We were as passionate in our workshop about cars as the customers were, and I think that kind of enthusiasm is either there or it’s not. It can’t be faked,” he explains.
Unsurprisingly, the biggest challenge for the business was finding the right people. Living out personal values might come naturally to a leader, but the real challenge lies in getting other people to follow suit. “I think the secret lay in teaching staff how to handle customers. When you’re running a big business, things don’t always go right all of the time. The important thing is to make sure your people know how to manage customer relations when things go wrong. First of all you must know how to talk to people. You must know how to receive them if they are unhappy – with empathy. When things go wrong all people want is for you to fix their problem with as little further irritation as possible,” Chatz explains, adding, “My instruction to the switchboard was to answer in three rings and to never ask who wanted to speak to me. If someone wanted to speak to me, they were to be put through.” Chatz was granted permission to trade as Alfa Romeo Cars, which was unusual at the time. And his public image as a racing champion was also being entrenched as he won the Saloon Car Championships in 1972, 1975, 1977 and 1979. “I was lucky in that I had a public profile in racing apart from my business, which made my name become synonymous with Alfa Romeo. I had a lot of lucky breaks which I suppose is the story with anything. You need to be in the right place at the right time,” he says. It also helped that motor racing provided the South African public with much-needed live entertainment and attracted an enormous following. “Remember that television only arrived in 1975 and then only for a few hours a day, so when there was a race on at Kyalami, people would camp over the night before just to get a good vantage point,” he says.
But while Chatz undoubtedly happened to be the right person with the right skills in the right place at the right time, he also understood the importance of marketing his reputation and harnessing the power of his public image. “I did all my own radio adverts, and I’d always end them with ‘And remember, when you call, please call me Arnold.’” Stretching his marketing buck, Chatz also took out a small advert every two days in the main body of the daily newspaper. “It was really simple and really economical but it worked. Everyone became aware of our existence,” he explains. The Arnold Chatz name may not yet have been on the outside of the building, but the brand was gaining traction and the public was left in no doubt about the identity of the man behind the business.
Alfa Romeo granted Chatz sole representation for the area north of Braamfontein, and eventually a dealership in the city as well. “My payoff line then was ‘Arnold Chatz is Alfa Romeo’, which used to drive the other dealers mad,” he recalls. At the height of his success, Chatz was selling over 175 cars a month, an impressive volume for the time and the brand. But then in 1985 everything changed. Alfa Romeo took a decision to withdraw from South Africa. “It broke my heart because the brand was my life. It was in my veins,” says Chatz. With his name so closely associated with Alfa, Chatz faced the real prospect of losing the brand equity he’d worked so hard to build. It was a challenge he managed to turn to his advantage, once again employing the power of smart marketing. “Everyone wondered what brand we were going to go with, and even if such a transition was possible, after having been the Alfa Romeo people for so long. So I started a billboard teaser campaign during the five-month Alfa wind-down period. Instead of ‘Arnold Chatz is Alfa Romeo’, the billboards read ‘Arnold Chatz is (?)’.”
When he eventually filled in the blank with ‘Nissan’, people were more than a little surprised. “It was a very different market to Alfa Romeo. Nissan was commercially-orientated, was into the fleet business, wasn’t a niche specialised vehicle and it didn’t have a strong presence in the Northern suburbs, which had become my stamping ground. But I’d had a long-standing pleasant relationship with Datsun, which had become Nissan, and I felt it was the right move,” he says. So the Alfa Romeo signs came down, the Arnold Chatz Cars signs went up and Chatz changed his strategy to suit an entirely new market. He won over some of the biggest fleets in the country, including the entire Automobile Association fleet, eventually becoming one of the largest Nissan dealerships in South African. Within a few years, Nissan brought out models like Car of the Year-winner, Maxima, and the 300ZX, which appealed to the northern suburbs market. “By that time, the Arnold Chatz name had become associated not only with the Alfa Romeo brand, but with good customer service and integrity, and I think it was this brand equity that made the transition surprisingly easy,” he relates.
The 1990s ushered in a new era for the business. “Nissan approached Fiat to bring the Uno into South Africa, and with Fiat being the parent company of Alfa Romeo, it was a natural progression for Nissan South Africa to get Alfa Romeo in 1995 when the brand came back to us,” Chatz explains. A year later, the company was approached to join Super Group for a listing. “I agreed to stay on with them for four years and then retire, which I did, but it was a very very difficult period for me. Being part of a large corporate with 26 dealerships is a very different game to running your own operation, but we made a success of it,” Chatz says. Before joining the Super Group, Chatz had taken on a partner in Derik Scorer, formerly from Fiat, and originally brought into the business to turn around the struggling Krugersdorp Nissan dealership. “Derik is a very, very smart man. He took that dealership from under 10 units a month, to 40 units a month and eventually became Nissan South Africa Dealer of the Year. After we joined Super Group he ultimately went on to become Managing Director of their Motor Division,” Chatz explains.
Three years ago, well after Chatz’s retirement in 2000, Scorer bought back the Arnold Chatz brand and original Hyde Park dealership from Super Group and went on his own. Chatz relates: “He called me up and told me he wanted to re-inject the original passion into the brand and asked if I’d help him, which I was more than happy to do. I am retired but I still read his ads for him and I am often in the dealership.” He concludes, “People still walk in and tell me they bought their first Alfa Romeo from me and are back to buy another. It gives me a great sense of satisfaction and continuity.”