The new strategy, dubbed the “Volvo Way to Market”, will focus on four areas – marketing tools, digital leadership, dealerships and service.
Moving away from motor shows
The key change will be Volvo’s decision to focus on just one international motor show in Europe, the US and Asia – Geneva, Detroit and Shanghai/Beijing – and launch its own annual Volvo event to showcase its products and brand. Volvo currently attends around 100 motor shows each year.
The decision, said marketing director Alain Visser, is aimed at offering Volvo exposure to the press and its customers outside of the traditional motor show, where many brands are crowded together and “battling” for press exposure. Similar to the Stockholm launch event for its new XC90 model in August, Volvo will organise an annual event that is says will be presented in a manner that is “commensurate with its brand and identity”.
Motor shows still attract major car brands and millions of car enthusiasts every year. At the Paris show in October, around 59 brands unveiled 100 new cars to 1.2m visitors and thousands of journalists.
However, a growing number within the industry are becoming disillusioned with trade shows, which can cost upwards of £2m and sees each brand get just a 20-minute slot to showcase their cars. Attendance is also falling.
Other car marques have moved away from launching new products at motor shows. Ford, for example, has previously launched its Focus EV and BMAX models at the Consumer Electronics Show in Las Vegas and Mobile World Congress in Barcelona respectively.
Neil King, automotive analyst at Euromonitor, says with more car marques choosing to launch products away from the main shows many are questioning their role. However, he cautions that there are risks in not being at the big motor shows.
“Car marques are finding other avenues to launch products. With that the case they may be asking why they are at motor shows.
“In recent years motor show attendances have been in decline and that peaked in 2009, causing certain brands to choose not to participate in the core circuit. However they have returned to the fold now. Motor shows still offer customers the opportunity to view multiple brands and products in one place – rather than trawling around a number of different dealerships.”
Focus on digital
Volvo says the pullback from motor shows is not a cost-cutting measure, with its marketing budget set to increase. It will now pump money into becoming a “digital leader” as it looks to take advantage of the shift from people visiting dealerships to researching online.
In 1994, the average car buyer visited showrooms six times before buying. By 2012 that figure had dropped to 1.2.
Volvo has already tested selling cars online with the XC90 model but will now expand that trial globally across a wider range of cars. It is also revamping its car website and car “configurator” from the standard “build from scratch” concept to one that it dubs “the designers choice”.
This will offer customers a fully-specified car that they can adjust based on their tastes and budget and send them a short video of their choice. “This will result in a simple, cool, fun and premium experience,” says Visser.
This will not be at the expense of dealerships, however, which will also be getting a revamp. Volvo will look to push its Scandinavian heritage with customer service improvements including offering customers regional food and drink and promote its premium credentials with the introduction of a new “personal service technician” for every customer who will be their main point of contact when buying and throughout car ownership.
The shift comes as Volvo looks to increase car sales from about 430,000 last year to 800,000 by 2020. Moves such as the launch of the XC90 and the marketing around it are already helping to push up sales in the UK, where its market share rose to 1.62% in the year to November, compared to 1.41% in the same period in 2013.