RAC banks on ads to rescue its image

It is less than 12 months since the RAC dropped the crown from its logo, resprayed its vans orange and repositioned itself as a “mobility” company.

For the RAC it was the most radical change since the creation of the motor car. A no-claims bonus on the breakdown service and the sale of RAC bicycles were both introduced. Travel cards in conjunction with London Underground and Railtrack were planned (MW April 24 1997) although they have yet to materialise.

The focus became retaining customers rather than increasing membership. Chief executive Neil Johnson talked about moving beyond a roadside breakdown service. The then group strategic director Jan Smith developed advertising through a “virtual” agency to re flect that change – the ads featured economists, environmentalists and scientists – and carried the strapline “welcome to the future in motion”.

A 4m budget was set aside for the documercial-style ads but according to one source the full-length version of the ad ran just three times.

The future motion was in fact Smith’s. She left at Christmas.

Now, less than three months later, M&C Saatchi has been hired in controversial circumstances (MW March 12). A review of its media buying has begun. And Smith’s replacement, Findlay Caldwell, is in place.

The big question is what all this change will mean for the RAC’s positioning and future marketing.

Certainly new members are again a high priority after a period when retention was seen as the primary objective.

Behind last year’s dramatic makeover was a need to move away from the perception that the RAC is “privileged” and outdated. More importantly it had to respond to the rise of the AA, the threat from other low-cost breakdown services, including Green Flag, and new entrants such as Direct Line which is expected to launch a breakdown service this spring.

The RAC’s membership grew from 2.4 million in 1989 to 5.8 million in 1992, partly thanks to the Knights of the Road advertising, but remained static for the following four years.

After the activity of the past 12 months the RAC’s membership remains just under 6 million while the AA has built its membership to more than 9 million in recent years through expanding its business into home services ranging from plumbing and selling domestic energy in partnership with Scottish Power.

“The RAC’s difficulty is that it is stuck between the size and ubiquity of the AA and the value end of the market characterised by Green Flag,” says one source. “If you look at everything that was going on at the RAC with new databases, change in uniform, and services, the ads can be seen as an aberration – out of step with everything else.”

Almost as soon as Smith left, the RAC took on a more establishment feel. It appeared to be a reaction to the Smith era. Caldwell, previously merchandise and marketing director at Dillons Bookstores, was hired as managing director of membership. Although he has a different title, he replaces Smith and brings direct retail experience from his previous jobs at Dixons, Boots and Littlewoods.

Caldwell and Johnson oversaw the advertising pitch which led to M&C Saatchi being hired. But the pitch was handled day-to-day by the RAC’s head of group communications, Andy Mitchell, and group communications manager Peter Hawtin.

The RAC plumped for a very conventional list of creative ad agencies to replace Smith’s virtual experiment. The opinion, both inside and outside the RAC, is that the advertising failed to communicate the changes in the organisation.

“Jan Smith was talking about the future,” says one source, “but the communication never related to current RAC products. I don’t know whether it would have been more successful if it had done that but the advertising would have been underpinned by a more sensible foundation.

“The basic (RAC) organisation seems to have the edge on the AA in terms of its dynamism and technological focus. But it is not doing what it needs to, which is concentrate on its core service, breakdown. People buy insurance against breaking down, that brings them into the market. It is crucial for the RAC to concentrate on membership for its core service.

“If it were to continue with the corporate philosophy (advertising) work rather than stressing the benefits to its members of membership it would be wasting its money,” says the source.

The RAC briefed the agencies to come up with proposals to continue the core positioning – RAC as a forward-thinking mobility company – while building membership for its roadside service and preparing a platform for the launch of new “mobility” products. These are believed to include a traffic management system, an on-board satellite receiver to speed up breakdown recovery and a “priority” service guaranteeing those who pay a little more a speedier recovery. It is understood that M&C’s suggested strapline will be “movement drives us”.

The late addition of M&C Saatchi to the pitch list caused anger among some agencies. Abbott Mead Vickers. BBDO, Young & Rubicam, BMP DDB and Bartle Bogle Hegarty were all selected through an Advertising Agency Register review.

M&C was also considered during the AAR process but did not make the original shortlist. The intervention of RAC chief executive Johnson and non-executive director Jeffrey Tolman is understood to have secured it the fifth slot on the list.

As part of its new approach the RAC will also seek to exploit its tie-up with the British School of Motoring, which it bought for 54.4m in November. As part of the deal it bought 135 high street branches, which may explain Caldwell’s arrival given his retail experience, and last week saw the opening of the first joint RAC/BSM driver training centre in London.

“The advertising will have to reinforce the brand values of the RAC,” says head of public relations John Hutson. “The relaunch was quite successful. The livery and corporate identity have been well received but the advertising now has to support that positioning.

“The public perception is lagging behind the reality. There will be new initiatives this year that will differentiate the RAC from rivals such as the AA and Green Flag.”

For 100 years the RAC remained firmly in the establishment. In the past 12 months it has changed massively. What it will look like in another 12 months time will have much to do with Caldwell and M&C Saatchi.