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For Volvo, Location Analytics Helps ‘Outsmart, Not Outspend’ Auto Dealer Rivals

The use of ‘movement data’ can track and connect website and offline dealership visits as well as analyze drivers’ location patterns and lifestyle, Volvo Marketing Director John Militello says.

While 90–year-old Swedish automaker Volvo didn’t become well-known in the U.S. until the 1960s, the idea of it being a “boxy, safe” — i.e., boring — car continued to dog it well into this century.

As the company sought to revamp that image in 2012, the use of location data has played an increasingly important role in helping to promote Volvo’s makeover as a “premium” vehicle that is pursuing advanced Internet of Things technology as a feature.

A Transformational Journey

“We’re a completely different brand today,” John Militello, director of Marketing for Volvo Cars USA told PlaceIQ CEO Duncan McCall in a presentation at last week’s MMA Location Leadership Forum. “We’re on a transformational journey. If you look at the new wagon we just released, it’s a totally different look from the past image. Since 2012, we’ve made the decision to go more high-end luxury and design versus mass market.”

Going into the luxury market, Volvo’s appeal was rated as a “4 percent brand that was aiming to be a ‘1 percent brand,” Militello said. The goal was to double Volvo’s growth in the fiercely competitive luxury market.

PlaceIQ’s Duncan McCall and Volvo Cars USA’s John Militello at the MMA’s Location Leadership Forum

While redesign has played a role in its attempt to literally reshape Volvo’s brand identity, its use of geo-data to get the right message to the right consumers has been invaluable while helping to hold down marketing costs at the same time, Militello said.

“As soon as we found traction on the XC90, Audi began conquesting us on search,”Militello said.

“We’re being outspent 5-to-1 in the automotive sector generally and 3-to-1 in the luxury sector,”Militello added. “We don’t have the money to punch up above our weight in media. So we have to outsmart, not outspend our competition.”

A Super Bowl Ad Interception

In January 2016, Volvo decided to forgo the race to spend between $3- and $4 million for a 30-second Super Bowl spot. Instead, Volvo and its creative agency, WPP Group’s Grey New York, “crashed” the Super Bowl with a Twitter hashtag campaign called #VolvoContest, where users “could win a brand new XC60 for someone who inspires and motivates them.”

To amplify the Twitter campaign, Volvo did a conquest on “auto endemics websites” like Kelley Blue Book and AutoTrader that are specifically focused on car buyers and enthusiasts. The idea was to chart the people reached during the Twitter campaign to their activity after the Super Bowl.

“We wanted to go beyond traditional marketing, but we were only looking at website traffic only as a correlation of sales up until then,”Militello said. “Now we’ve adjusted those KPIs to get a more realistic look at where we can connect with consumers along their journey.”

And that’s where the use of geo-data kicked in.

In March, Volvo updated its Sensus Navigation for the V90 Cross Country model.

The Value Of Movement Data

“It all comes down to attribution,” Militello said. “What pieces actually move the lever?”

For PlaceIQ’s McCall, who showed a presentation tracking a range of online/offline behaviors by Volvo customers versus those of rival luxury brand Jaguar, the use of movement data and shared location provide the answers to the attribution question Militello posed.

“You can separate out people going regularly to one brand, which tells us a lot about their intent,” McCall said. “If you’re going to a variety of brands, that says something. We can drill down further and see how and why someone is going to a competitor dealer as opposed to mine?”

Examples of the kinds of insights that is typical with analyzing movement data:

  • If someone goes to the mountains, we can tell about lifestyle.
  • Are they in the automotive OEM’s CRM system?
  • Have they visited the website recently?
  • What’s the correlation between activity and visitation on an automotive dealer website and actual dealer visits in the world?

“Movement data, third party-data, and connecting that brands’ first-party data allows us to target and measure,” McCall said. “But more importantly, you can analyze and understand and apply it to cross-screen marketing beyond mobile to addressable TV. We can revolutionize linear TV and out-of-home. The opportunity is broad.”

That’s not to say Volvo doesn’t have its challenges: while Volvo reported global sales growth of 9.3 per cent in March, with a 7.1 percent gain in Q1 2017, sales in North America were down 22 percent for the month and 17 percent for the first quarter.

Here too, location data can soften some of the shocks that come with highly volatile auto sales.

“We adjusted our KPIs and now we’re starting to model ‘future forward,’ Militello said. “We know from our media mix, that our share of voice equals share of business and how we correlate web traffic to sales. Now, we’re trying to model that forward to ask for the right amount of media dollars against volume.

“For example, if I sell a thousand less cars, I have to cut budget the next quarter,” he added. “So we want that to be more predictable. The auto industry can go up and down. And if our competition is out-spending on conquest, it can take a big chunk out of us.”

PlaceIQ compared Volvo and Jaguar dealership visits.

The Evolution Of Mobility

Most automakers have been aggressively pursuing autonomous driving as well as shared mobility over the past two years.

Last December, Volvo and Uber expanded their August agreement establish a jointly-owned project to build cars and develop fully autonomous driverless vehicles. These cars were initially tested in Pittsburgh, Pennsylvania, and were then added to San Francisco.

“Autonomous driving is a big focus for us, Militello told GeoMarketing. “And the influence is already being offered right now to our drivers. Many of our cars come with an early level of autonomous driving, which takes over steering as well as braking and acceleration. And we know that all that demands better, exact location data. Location is paramount for us on every level from marketing to autonomous driving.

More recently, Volvo’s updated its Sensus system, which involves a “measured response to users’ emotional and physical needs” with touchscreen controls and a visual, real-time mapping in the dashboard.

As clients look beyond marketing use cases for the location services they need to expand, PlaceIQ’s McCall noted how providers of geo-data like PlaceIQ are responding.

“Our fastest growing business unit is not marketing, it’s analytics,” McCall said. “Location is in everything digital, and it’s going to be in your car. The idea that these types of predictive analytics — where do people go, what do they do — is something we’ve seen the tipping point for.”

Even outside of his direct focus at using Volvo for marketing purposes, Militello offered an anecdote from a recent trip to South Africa that illustrated the ubiquity and value of location intelligence.

“I was just in South Africa shooting a spot for Volvo and I was on the plane heading home,” he said. “Someone asked me where I’d been and I showed them a photo of where I was. And I didn’t realize, but they were able to hit a button and find out exactly where I was and we had a conversation about that. So we want to be able to extend those experiences to the car itself and give our marketing people and our drivers a set of capabilities that haven’t existed before. And location is making that happen.”