Volvo invests in carwow to learn lessons about online retail
Volvo Cars has taken a minority stake in carwow through its Volvo Cars Tech Fund, hoping the successful online marketplace will help it become better at selling online, customer acquisition and content creation.
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It may seem a strange move for the auto maker when currently most of its sales are transacted through dealerships and retail partners. However, the car maker is not blind to the fact that markets are evolving and many customers are now comfortable buying online, including cars.
“Third-party marketplaces play a key role in any consumer industry, which includes the competitive landscape of Volvo Cars,” said Lex Kerssemakers, chief commercial officer at Volvo Cars. “We were one of the first car manufacturers committed to shift to online sales and through this strategic partnership, we will learn and gain insights into online buying behaviour. Our collaboration with carwow will help us and our retail partners grow volumes and reach our target of selling around half of our volume online by 2025.”
Lessons in how to improve customer satisfaction
carwow, which operates in the UK, Germany and Spain, has been hugely successful in building a massive reach with a YouTube channel with almost 7 million subscribers and a customer satisfaction rating of 4.8 out of five for the overall car buying experience. This betters Volvo’s customer satisfaction rating score of 4.3 for its direct sales program.
Volvo and carwow have been collaborating on the automaker’s car subscription service Care by Volvo so it’ll be interesting to see how the relationship develops. Both companies are keen to point out, however, that the relationship is not exclusive, which means they are both open to working with other partners.
Image: Volvo Cars