Product fit: From one-off asset to vehicle-as-a-service

Over the past years, there has been a consistent decrease in the significance and attractiveness of owning a car. The traditional notion of cars as status symbols has diminished, extending beyond just the millennial demographic. With the associated responsibilities and long-term commitments, many individuals are reluctant to embrace vehicle ownership. In a dynamic world marked by constant mobility and rapidly changing life circumstances, consumers now view conventional car financing and leasing agreements as more of a burden than a benefit.

In 2019 we worked with a premium OEM in Canada to establish a new vehicle subscription and rental business unit as a strategic building block allowing optimized asset utilization across the entire vehicle lifecycle. This strategic move enabled the company to address the change in consumer behaviour increasingly shifting from ownership to usage-based models and new mobility providers disrupting the transportation market. 

Solving two distinct business problems: 

A subscription model allows the OEM to cater to each customer’s individual mobility needs, increasing the likelihood that they can attract new and retain existing customers and fully utilize the asset value.

The OEM now has the ability to monetize an asset not just once, but multiple times as well as the ability to offer add-on services, and understand the customer better to strengthen the relationship.

To thrive in this market, subscription services require a comprehensive product strategy centered around distinct features, such as seamless, all-inclusive service bundling, recurrent extensions, and diverse vehicle access. Merely providing a modified version of existing leasing or rental products will prove inadequate.

These requirements created a range of complexities to consider in the business plan, fine-tune in the testing phase and monitor during operation, continuously adapting the product and business model to market needs:

OEMs face uncertainty about where subscriptions fit into their broader strategic agenda. Concerns arise about potential sales cannibalization and the impact on longstanding dealer relationships.

Managing & financing fleets, product mix, and eventual remarketing, these requirements—along with their associated costs—are vital factors to ensure the economic viability of subscription models.

In order to provide one price and cater to different customer's preferences around access to multiple cars, terms of service and delivery expectations we had to find the right single or multi-vehicle subscription product offering,  work around local insurance regulations, and provide a seamless customer experience

Finally, the right technology has to seamlessly integrate the complex customer journey and a large amount of coordination is required to ensure an optimal customer experience.

We were able to understand customer needs, overcome the complexities and  develop a strong subscription and rental product offering that successfully addressed the evolving consumer landscape and opened new revenue opportunities in the mobility market. With a solid product-market fit we crafted and implemented a highly targeted go-to-market strategy and creative marketing strategy, ensuring the initiative's success in a rapidly evolving market. 

We were able to break-even in year one and become the top performing location globally with strong future growth projections, showcasing our ability to solve complex business problems, navigate challenges, innovate in marketing, and drive successful business transformations.

Vehicle subscriptions empower companies to forge a stronger connection with end customers, taking charge of the customer experience through direct delivery of valuable digital services. This becomes increasingly vital amid rapidly changing consumer mobility needs and evolving work dynamics.

For consumers, subscriptions provide a low-risk avenue to explore new brands and electric vehicles (BEVs) and can hopefully be a great avenue to drive EV adoption.

Faced with evolving customer expectations and the need to bridge online and in-person touchpoints seamlessly, a high-end performance brand identified the need to create a Canadian omni-channel customer experience strategy roadmap that took into consideration the constraints of a globally managed digital experience and a complex partnership framework in the physical retail space. 

Given a fragmented customer experience involving multiple stakeholders across various online and offline touchpoints and the added complexity of managing multiple CRM systems, it became imperative to chart a course that not only addressed customer challenges but also capitalized on new opportunities. The overarching goal was to align all stakeholders with a unified vision and mission: to position the brand as the most customer-centric luxury performance brand in Canada, consistently delivering benchmark experiences across all channels. This strategic initiative aimed to streamline customer interactions, enhance satisfaction, and foster a cohesive approach across the organization

The initial phase comprised an extensive analysis and customer journey mapping exercises, discerning both pain points and aha moments. This involved qualitative interviews with stakeholders, customers, and prospects, supplemented by competitive research and benchmark analysis within the luxury performance industry

We pinpointed specific customer segments with potential for growth and improvement, along with well-served existing customer bases. Rather than rigidly defining the customer journey based on personas, our focus was on crafting an adaptable experience that caters to individual needs. The objective was to allure new target groups without alienating our existing customer base.

An essential phase in guaranteeing the success of a pivotal strategic initiative, like enhancing customer experience, involves prioritizing alignment from the outset. After establishing the current state, consensus was reached on the critical areas for refinement and development. Additionally, there was an overarching alignment on the envisioned direction for the project. This foundational alignment proved instrumental in steering the subsequent steps of the strategy development as well as ensure feasability in the implementation phase.

In crafting our customer experience strategy, we meticulously developed a comprehensive plan that struck a balance between uniformity and adaptability. Our approach established a solid baseline, ensuring consistency in our brand promise while accommodating the need for flexibility and local adaptation to cater to the unique nuances of each market and individual customer. This strategy served as a robust framework, functioning as the guiding principle for the complex realm of customer experience, which inherently spans multiple departments and involves collaboration with diverse business partners. It became the cornerstone for organizational alignment, ensuring that every department and individual initiative resonated with and contributed to the overarching customer experience vision. Embracing the principles of strategy development outlined above, we aimed to deliver a personalized, consistent, and premium customer journey, fostering satisfaction and loyalty across diverse touchpoints

Operationalizing this strategy involved the rollout of consulting programs that empowered staff at all touchpoints. These programs aimed to align teams with the new strategy, ensuring a unified approach. Key Performance Indicators (KPIs) were carefully defined to measure the success of the implemented initiatives.

Through a strategic focus on customer experience, the company not only addressed current challenges but also positioned itself to adapt to future customer expectations. The company is successfully transforming its customer experience within the framework created, working towards their goal of a seamless journey across channels. Customer satisfaction is increasing and the flexible strategy allows for continuous improvement and adaptation. 

In response to dynamic market demands and ambitious growth targets, a premium brand aimed to fortify its market position through an innovative retail network expansion strategy. The goal was to not only adapt to evolving consumer trends but also achieve substantial growth in market reach and revenue. 

The key objective was to strategically evaluate the current market situation and create realistic growth scenarios with the implementation of new, innovative retail formats and new partnerships to increase profitability nationally by keeping the cost low.

We applied a holistic and data-driven approach to effectively navigate a competitive market landscape:

• Reviewed existing network's performance with over 50 KPIs and identified areas of opportunities
• Conducted an in-depth analysis of market trends, consumer behavior, and competitor strategies. 

• Collaborated with key stakeholders to formulate a robust strategy. 
• Prioritized regions and markets based on potential and aligned the plan with overarching business goals.

• Defined clear KPIs, including market reach and revenue targets. 
• Established a monitoring system for ongoing evaluation to ensure the strategy's effectiveness.

• Engaged with cross-functional teams to ensure seamless execution of the expansion plan. 
• Fostered collaboration between marketing, sales, and operations to optimize results.

With a strong strategy aligning internal efforts, the company set clear objectives across sales, marketing, and operations, surpassing expected results and contributing significantly to overall financial success. The expansion not only bolstered market share but also elevated customer engagement through strategically positioned retail outlets, enhancing the overall customer experience. 

Continuous monitoring is crucial for sustained growth, via the established KPIs  adjustments to the strategy can be made as they are required to adapt to changing market dynamics and consumer preferences

In the era where consumers prioritize a company's purpose and culture, environmental, social, and governance (ESG) considerations have become paramount. Collaborating with a luxury OEM, our mission was to establish a solid foundation to enable them to reach their target of carbon neutrality by 2030, ensuring tangible impact and continuous progress monitoring. The challenge was not succumbing to ESG as a mere checkbox but instigating a cultural shift for sustainable practices.

Recognizing the risks and the fear of greenwashing, our approach focused on translating ESG targets into actionable insights with clear monitoring systems. The goal was to align all partners with a global vision, considering evolving customer demands, community impact, and diverse stakeholder motivations.

Central to the success of our strategy was a meticulous approach to data collection across environmental, social, and governance aspects. We initiated a robust process to gather relevant metrics, assessing the current situation in each area. This involved detailed evaluations of carbon footprints, social impact, and governance structures within the retail network. The collected data served as the foundation for creating comprehensive reports that provided a holistic understanding of the organization's current standing in relation to ESG goals. These reports not only facilitated informed decision-making but also acted as vital tools for communicating progress to stakeholders, instilling transparency and accountability throughout the implementation process.

Implementing ESG initiatives required a significant element of change management. We navigated this by creating individualized, actionable plans for retail outlets, considering their distinct construction timelines and initial procurement processes. Communication strategies appealed to diverse stakeholder motivations, whether ethical, emotional, or logic-driven.

While ROI considerations were essential to get buy-in from business partners, the primary focus was on attracting and retaining ethical consumers. The vision extended beyond immediate revenue relevance, emphasizing long-term strategic benefits and corporate citizenship responsibilities.

Recognizing the supply chain's significant contribution to emissions, our strategy incorporated sustainable practices into operational processes. Opportunities for a circular economy were identified, addressing the environmental impact of the supplier base.

The success of the ESG initiatives lies in transforming aspirations into concrete actions, fostering a culture of sustainability, and appealing to diverse stakeholder motivations. Our case study exemplifies how we were able to translate a luxury OEM strategic vision into operational targets and actionable initiatives, creating positive global impacts while securing long-term brand resilience.