Renowned for safety and reliability, Volvo is making waves in the luxury sector too. Siobhan Adams spoke to senior VP, marketing, sales & customer service, Doug Speck in Alicante and Abu Dhabi.
Michigan native Doug Speck, 53, began his career in the auto industry with Ford Motor Company in 1983. Since then he has held senior positions within Ford, Jaguar, Land Rover and Volvo. His experience includes establishing and growing operations in North America, Australia and Europe.
I hear you are changing the brand architecture of Volvo, moving away from something less associated with safety towards something a bit more, shall we say, dynamic?
I would probably frame it differently.
In addition to continuing to be recognised as the safety leader in the auto industry, we are also working to be recognised as leaders in areas such as design, intuitive technology and fun-todrive. Our objective is to retain those things that make us unique, like safety, and build on some other attributes that help us achieve our luxury aspirations.
So you are moving more into premium? Is that the underlining focus for everything?
Yes.
Earlier you said Volvo was the fastestgrowing auto brand in the premium sector. . .
If you look at September 2011 year-todate, compared to other luxury marques, year-on-year we're the fastest-growing car brand.
Can you substantiate that?
I can't give you figures for BMW, Audi or Mercedes, I don't have them in my head, but it's based upon growth for us of 22.4 per cent year-to-date, versus other luxury marques.
What fuels this growth?
Predominantly the success of 60 products, so the S60, V60 and X60, which are all fairly new. They have been received extremely well, and the bulk of growth is coming from those three cars.
How significant is the MENA region to Volvo overall, in terms of sales and potential growth?
Growth in the Mena region is 30 per cent year-to-date, so it's growing faster than we are on average. As a matter of fact, within the organisation that I am responsible for right now we're reorganizing. We reorganising our infrastructure so that we have specific components of our business focused on both the markets and what it takes to really accelerate that growth. And this region falls into that new group. So clearly our aspirations for this region, as well as other markets, let's say like Russia, Brazil... we put them in the same category.
Any specific marketing plans for the Middle East?
Let's step back in time a little bit. You will be aware that we went through a sale last August. One of the things that we did post sale was to conduct a strategic review of the brand to say: 'What would we like our brand to mean 10 years from now'?
The result was that we agreed a concept called Designed Around You, which is actually a business proposal not specifically just a marketing campaign. In other words, everything that we do, whether it be the way we design our cars, the way we design our technology, the communication we put out in the marketplace, it's going to be centred around "what does it take to build cars that customers want". We think that's how we are going to distinguish this brand, let's say, from the Germans.
What was the previous campaign?
It was built around Life is Better Lived Together. But frankly it was just a brand campaign. It didn't have the depth that it needed, because ultimately all aspects of your business need to work in the same direction. You just can't have a brand campaign and have your products be different over time. That fails.
So this is much deeper. It runs into every aspect of our business and it's also much further in its strategic vision of a 10-year plan, not a one-year plan, two-year plan or three-year plan.
So, we are right now in the phase of rolling that out, and from that, sales companies will then tailor what does that mean in this region, versus what does it mean in another?
An example of that is the way we approach Designed Around You in China, from a lexicon perspective, to meet the needs of Chinese consumers.
You have to tweak it a little. It actually doesn't translate well from English to Chinese. So we will tailor to the region to make appropriate. But the core thought doesn't vary. We want our cars to be explained well. What the customer wants is the centre piece of the strategy.
We're still working on how to execute this across the various places and roll it out in 2012.
Which agencies devised "Designed Around You?"
Our lead global creative ad agency, Arnold Worldwide, (Amsterdam and Boston) developed the line, with strategic assistance and adaptation from Euro RSCG 4D (lead digital agency), Forsman & Bodenfors (lead agency for Nordic), and La Comunidad (brand identity). SapientNitro in Shanghai also assisted.
Did the new strategy also involve new agencies (globally?)
Only in that our roster agencies worked in collaboration and globally, without regard for location.
So how does the Volvo Ocean Race tie in with Designed Around You?
Part of what makes a brand more premium, if you will, a luxury brand is about this whole subject of passion. How do you stimulate passion around your product? And for us this is all about passion. If you go and talk to the sailors and ask them "why did you participate in the Volvo Ocean Race"?
It's really because they are very passionate, competitive sailors. So we want to make sure we translate that energy from race to our brand, and an important component regarding why you can be that premium is to have people with that passion.
There are also some technological things we get from this. We learn a lot about communications. These ocean vessels are very linked from a satellite communications perspective. So we figure out how we can communicate all over the world and that can make its way into our technology; it's how to use light-weight materials. The whole of these boats are about carbon fibre etc.
In the auto industry today, everyone wants great fuel efficiency and low CO2 emissions but, in addition to that, they still want a car that performs well.
Weight plays a role in that, so if we can learn from the technology on how we use carbon fibre as an example and bring that in our cars in future, it will help us meet some of the things we have to do. So there is technological gains, there are brand gains from an imagery perspective. They can all make a difference to us strategically.
Much as I see Volvo as a premium brand, in my mind, and I think it's fairly representative of consumers' minds, luxury autos are marques such as Lamborghini, Ferrari, Porsche ... I don't see Volvo sitting comfortably there. Obviously, here I am viewing luxury as a badge and indulgence versus cost.
Those brands represent a super luxury that only about 0.5 per cent of the population can reach. We play in the more inclusive luxury segment of BMW, Mercedes-Benz, Audi, and Lexus. Our research tells us that luxury is how you make the customer feel, not just the badge, and we have a credible luxury offer in terms of customer benefit.
Does "Designed Around You" describe MENA's marketing strategy for 2012, ie spend (US$) and media channels?
We will finalize the MENA marketing strategy at the end of Q1 around our global campaign. You already see the new elements of our new campaign in terms of product images, etc, in the region. The focus will be on digital channels.
So it's accurate to say that through the Ocean Race association, Volvo has taken its safety proposition to the extreme as well as harnessing the passion associated with luxury?
It's very accurate. However, Volvo is much more than safety. It's also great Scandinavian luxury design, a human-centric approach to engineering, and capabilities and durability for the most demanding of driving needs. That's what makes Volvo Cars "Designed Around You."
© Gulf Marketing Review 2012
