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Volvo Analysis RAJ2 2013© 2 Contents Page Number “Life Goes On” Volvo Analysis 2 Agency: RAJ 20/12/2013© To: The Marketing Manager, Volvo Cars UK, Scandinavia House, Norreys Drive, Maidenhead, Berkshire, SL6 4FL. Contact Details: Alisha Attarwala Account Manager [email protected] Mob: 07544747677 Volvo Analysis RAJ2 2013© 2 Contents Page Number 1. Process Map 4 2. Executive Summary 5 3. Company History 6 4. The Problem 7 5. Client’s Agenda 8 6. Target Audience 9 7. Competition 10 8. Primary Research 11 9. Other Research and Evidence 12 10.Content Marketing Matrix 13 11.Creative Brief 14 12.Strategy 15 13.Customer Journey 18 14.Media and Budget 19 15.Conclusion 21 16.Research and Resources 22 Volvo Analysis RAJ2 2013© 3 Process Map Research: - Autocar votes it as one of the top 5 compact SUVs - Top Gear gives it 7/10 Creative Brief Target Audience: Ideas: - Life Goes On Men and women, 25 to 44 years - Vikings: tough car old with an annual income of - Ambient ad: car vs snow - Weather report over £50,00 - Steps turning to tyre tracks Final Idea: Media: Life Goes On - Television - Radio - Print Pitch Volvo Analysis RAJ2 2013© 4 Executive Summary This is an analysis for Volvo Cars UK, with the main focus on the Volvo XC60. According to Mintel, ‘the UK new car market surpassed 2 million in 2012 with sales at 2.05 million units. Yet despite increasing against 2011, volumes were similar to those achieved in 2010 and remain well down on sales in 2007 (2.41 million units). New car sales increased by 110,000 units (between 2011 and 2012) to 2.05 million. Yet compared with 2007, sales are currently well down on recent levels, standing at 15% off their 2007 peak. Yet despite such a fall in overall sales in 2007, there is some room for optimism. Current 2012 sales are ahead of their recent low point of 1.99 million units in 2009, although variability in annual sales since 2009 does remain an issue.’ (Fig. 1) (Mintel, 2013) Fig. 1: UK new registrations of motor vehicles, 2007-17 Source: Mintel, 2013. Volvo Analysis RAJ2 2013© 5 Company History Volvo was born on April 14, 1927, when the first car, ÖV4 (nicknamed Jakob) left the factory in Gothenburg. (Swedecar, 2013) Volvo was incorporated in 1915 as a subsidiary of AB SKF, the Swedish ball bearing manufacturer. In 1924, Assar Gabrielsson and Gustaf Larson, the two founders, decided to start construction of a Swedish car. The original production models were designed to withstand the rigors of Sweden's rough roads and cold temperatures. This emphasis on durability has been a feature of Volvo products ever since. (Volvo Group Global, 2013) What makes Volvo Cars unique in the automotive world is its focus on human values in life. Caring about yourself and others; the safety concept encompasses not only the passengers of the car, but also passengers in other cars, and pedestrians. Environmental care goes beyond legislation-and consideration for customers shall imbue the entire company. (Facebook, 2013) Volvo Analysis RAJ2 2013© 6 The Problem According to the Financial Times, Volvo has struggled in recent years, as sales at the Swedish group famous for its safety standards are seen as too low to enjoy big economies of scale, while its brand has a lesser image than larger rivals such as BMW and Audi. Volvo had an operating loss of SKr (Swedish Krona) 577m, compared with a profit of SKr 349m in the first half of 2012. Revenues fell by 14% to SKr 56.4bn. (Milne, 2013) Volvo Analysis RAJ2 2013© 7 Client’s Agenda The client’s agenda is to promote the Volvo XC60 as a tough, all wheel-drive SUV that is able to manage anything the winter has to throw at it. The car is solid and reliable, and will keep your family and you safe and comfortable in even the harshest of weathers. This message has to be delivered to the target audience. (Client brief, 2013) Volvo Analysis RAJ2 2013© 8 Target Audience According to the client, the campaign should be aimed at people who are in- market already i.e. looking to purchase a car. They are open to purchasing Volvo although, it may not be on the top of their list. (Client brief) According to Mintel, ‘males (15%) more than females (9%) are more likely to have a car bought from new that is under two years old. Differences are also evident by age with young adults in particular appearing to be more likely to have changed their cars in the last two years. Such an interest in cars spans both those who have purchased new and those buying used with this especially evident for used buyers aged 25-44. In contrast, older adults are less likely to have changed their cars within this two-year period. This is particularly true for over-65s. Some 26% of this group have purchased a car from new more than two years ago and still own the vehicle, as compared to only 8% of those aged 16-24 who have a car purchased from new over two years ago. Income is a very important factor in determining if an individual owns a car less than three years old. Mintel’s research, for example, shows that whereas 16% of households with an income of less than £15,500 own a car less than three years old, this rises to 40% for households with incomes of £50,000 or greater. Even with cars aged three to six years old, there is still influence of household income on ownership.’ (Mintel, 2012) Since Volvo is an upmarket brand, the target audience for this campaign would be men and women between the ages of 25 and 44, with an annual income of over £50,000. Volvo Analysis RAJ2 2013© 9 Competition According to the client brief, the Land Rover Free 2 would be a competitor for the Volvo XC60. Land Rover Free 2’s “Brie” commercial promotes the car as the one to protect you from the cold and wet quite well. (Client Brief, 2013) According to Mintel, Ford and Vauxhall dominate the UK car market, followed by Volkswagen, BMW and Audi. These are thus, the biggest competition for Volvo. (Fig. 2) (Mintel, 2013) Fig 2: Manufacturer shares of new car registrations, 2010-12 Source: Mintel, 2013. Volvo Analysis RAJ2 2013© 10 Primary Research • Top Gear gives the Volvo XC60 a 7/10 verdict. According to Top Gear, the Volvo XC60 is “a safe way to move a family around.” Top Gear also mentions that the Volvo XC60 is easily a rival for the Land Rover Freelander. Top Gear also says that the Volvo XC60 is good in snowstorms, but doesn’t make it any more fun to drive. Vast amounts of safety kit might be great for piece of mind, but the warning bongs can be intrusive: anti-collision warning lights, blind spot monitors, lane departure buzzer, pedestrian detection. It’s all there. Shouting at you. Loudly. (Top Gear, 2010) • Autocar’s Jim Holder says that Volvo is justifiably proud of its different approach, and the usable, attractive XC60 is good enough to stand out in a very able compact SUV crowd. It ranks number 3 on Autocar’s list of Top 5 compact SUVs. (Holder, 2008) • According to Go Compare’s Covered magazine, the latest XC60 is freshly facelifted with a more rugged front end, a tweaked interior and a whole new set of safety related acronyms. It’s certainly more rapid than it feels; such is the isolation from the road at speed. You’ll barely feel the road as the suspension is set up perfectly for cruising, soaking up every bump and imperfection. (Huff, 2013) Volvo Analysis RAJ2 2013© 11 Other Research and Evidence • The Society of Motor Manufacturers and Traders, UK states that automotive is a vital part of the UK economy and typically generates more than £55 billion in annual turnover, delivering around £12 billion in net value-added to the economy. (SMMT, 2013) • According to the Automotive Council UK, the automotive industry is the UK’s largest sector in terms of exports and generated £27 billion of export revenue for the UK in 2011. In a typical year, the sector exports to over 100 markets worldwide and accounts for around 11% of total UK exports. (Automotive Council UK, 2013) • Wall Street Journal reports that in 2012, there was a 6% drop in sales of Volvo Cars. However, in the UK, new car registrations rose 5.3% in 2012 on the year to 2.04 million units, the highest annual volume since the recession struck in 2008. (Molin, 2013) • Forbes’ Dale Buss quotes Volvo’s Vice President of marketing and production planning. Volvo owners’ “interpretation of luxury is different but very real. They’re more into life’s experiences, and more into a Scandinavian simple design [of vehicles] versus a lot of clutter. They are very much luxury customers and love luxury products, but they don’t feel a need to impress others.” (Buss, 2013) • Reuters states that Volvo’s sales rise in September 2013, with China being the top market, followed by Europe. In Europe, sales shot up by 24%. (Reuters, 2013) Volvo Analysis RAJ2 2013© 12 Content Marketing Matrix The Content Marketing Matrix is a strategic way of depicting how to market and advertise to the target audience. The content marketing matrix is divided into four parts: Entertain: This is how the consumers will be entertained. In this campaign, it will be done with the help of the TV Commercial (TVC), the radio ad, videos about the Volvo XC60, and the print ad (to an extent).
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