Sweet Success

Richard Nolan

Richard Nolan

Operations Director

The Financial Services Forum

Volkswagen Group Leasing leveraged the power of business and behavioural data to lift the lid on vehicle procurement. Finely-tuned messaging resulted in turbo-charged sales and well-engineered marketing performance.
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THE CHALLENGE
Sales figure analysis by Volkswagen Group Leasing (VGL) identified potential growth within the public sector specifically through the Crown Commercial Service’s Supplier Portal (CCSSP). With 16 months
left on their framework, the challenge was to significantly increase additional business through the portal.
Research identified a lack of awareness in the public sector of VGL’s multi-marque capabilities. As a result, ambitious public sector growth targets were set:
• generate 18,000 quotes through the CCSSP by May 2014 – an 11% increase from same time period in 2013
• increase target of 771 orders delivered through the CCSSP from Jan to May 2013 to 1,115 from Jan to May 2014
• move to position one in the sales of group vehicles in CCSSP in 2014
• increase sales of multi-marque vehicles (outside of group) within the public sector by 5%
• create 60 attributable leads from ‘first wave’ public sector direct marketing for sales team conversion through to Crown Commercial Service (CCS) quote.
THE STRATEGY
Research of data within the CCSSP identified the size of the market and VGL’s position within it. This analysis was used to set SMART objectives.
Out of 19,681 vehicles procured through the portal, VGL had an 11% share with a total of 2,133 vehicles procured in 2013.
Data interrogation into procurement methods highlighted that three out of every four vehicles were sourced via fleet management businesses.
However, VGL only had a 7% share in this market, with five major competitors on the framework claiming a much higher percentage share.
A number of key insights were drawn that underpinned our strategy and tactics:
• order of appearance in search results via the portal is not indicative of potential sales – instead a major issue revolves around product/service awareness
• fleet management companies are untapped, i.e. VGL only have a 7% share of business on CCSSP
• direct business is important but not dominant (25%)
• huge amount of growth potential within CCS and dominated by NHS
• frameworks outside of CCS are worth investigating but not a priority.
In summary, the proposed strategy to address the challenge was as follows:
• protect and grow the public sector market via CCSSP focusing on:
– gaining share of vehicles sourced by fleet management companies
– increasing preference of customers sourcing directly from us
– increasing preference of fleet management companies procuring direct
• target with a multi-marque message and promote the range of non-asset-based products and services
• drive leads through a structured CRM of direct marketing and telesales resulting in requests for quotes through the CCSSP.
THE EXECUTION
Data analysis exposed what was really happening within CCSSP and how vehicles were being procured. VGL extracted data to identify information that allowed the firm to target the right organisation, department, role and person. Combining CCSSP search and lease data with owned and externally sourced data, VGL compiled lists of sales reps within lease management companies and public sector lease managers.
Tailoring the message
Due to lack of awareness, it was essential the strategic approach capitalised on the power of the group. From this, the ‘Pick and Mix’ concept was born – choosing a vehicle through VGL is no different than picking your favourite sweets from the sweet counter. Customers can pick whatever car they want from VGL’s perfect mix of vehicles and non-asset-based products and services.
Structured direct marketing campaign
Multiple touchpoints were crucial to reinforce the message and push customers to complete quotes via the portal. Data was segmented, sourced and cross-referenced against CCSSP
to cover the markets for growth. The direct marketing campaign was planned to support a public sector show to amplify conversion opportunity, including:
• an initial ‘conversation starter’ direct mail in the style of a retro bag of sweets with a personalised label showing the range of pick and mix from VGL, including classic pick and mix sweets
• pre-event email invites to the stand and follow-up emails
• dedicated telesales to raise awareness and drive customers online to request quotes.
METRICS PUT IN PLACE
This campaign is the first dedicated initiative aimed at the public sector – benchmarked figures were taken from data within respective 2013 time periods; therefore VGL can assume that uplifts
in activity can be directly attributed to increased direct mail activity.
a) Generate 18,000 quotes through the CCS portal by end of May 2014 – a 12% increase from same time period in 2013 – By 31 May 2014, 19,516 quotes across all identified public sector markets
had been generated through the portal – exceeding targets by 1,516 quotes, equating to a 21% increase from 2013.
b) Increase target of 771 orders delivered through the CCS portal from Jan to May 2013 to 1,115 from Jan to May 2014 – May sales figures confirmed that there were 2,326 orders delivered YTD, equating
to 233% against target.
c) Move to position one in the sales of Group vehicles (Volkswagen, Audi, SKODA, SEAT) in CCS portal in 2014
– By April 2013, increased activity within the public sector has meant that VGL is now number one for VWG product on the CCS Framework for the first time since going live.
d) Increase sales of multi-marque capabilities vehicles (outside of Group) within the public sector by 5%
– Strong, consistent messaging has delivered a significant shift in the number of public sector customers leasing nongroup vehicles – moving from 46% multimarque in 2013 to 55% by May 2014.
e) To create 60 direct attributable leads from our ‘first wave’ public sector direct marketing for sales team conversion through to CCS quote – Individual results for each stage of the campaign has
outperformed industry averages.
• The direct mailing was sent to 3,000 and generated 40 leads (against a set target of 30), equating to a 1.3% success rate.
• The invite email had a 20% open rate (against an industry average of 17%) and generated 80 leads for the sales team at the show (58 new leads and 22 already on our database.)
• Follow-up emails had an outstanding 30% open rate.
The campaign generated 98 new leads in total. Based on a forecasted 1:8 conversion rate, this would equate to 12 new customers and provide an ROI of £13 for every £1 spent.
VALUE ADDED
1. Revenue – generated significant revenue for VGL to further fund growth
2. Customer and repeat business – our existing customer base has increased, leading to considerable organic growth
3. Market share – now the driving force within CCS and are winning more quotes as a result. Conversion – creating relevance by understanding buying trends and converting at higher percentages
4. Pipeline – considerable growth in pipeline opportunity
5. Research – understanding the data universe in CCS means VGL can model purchasing trends and intent
6. Brand – VGL is more widely understood by the target audience in terms of brand perception
7. Competitor analysis – through analysis of CCS data, VGL is able to see how our competition approaches the market
8. NPD – although focused on vehicle sales, VGL has been able to understand what non-asset-based (NAB) products our customers are interested in.
VGL successfully researched the customer, their journey, looked at purchasing trends, data modelled, manipulated, segmented and mined – then tested and refined activity with incredible commercial creativity that led to deeper engagement. The outcome was truly effective marketing and advertising. Ultimately, the campaign has made VGL more effective and delivered higher ROI on their marketing spend.

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