Volvo 2012 Annual Report Download - page 26

A GLOBAL GROUP 2012 BUSINESS MODEL
PRODUCT OFFERING
Strong brands are important assets
By selling products with different brands, the Volvo Group
can penetrate many different customer and market segments
in mature markets as well as growth markets.
olvo Group does business under sev-
eral leading and respected brands.
Each brand in the portfolio is focused
on different industry and market seg-
ments. Several brands are available globally, while
some are focused on specific regions of the world.
Brand positioning project aims to unlock
hidden potential
Increasing market coverage, sharing and better
utilizing resources, and increasing market share
– these are the aims of the new Brand Positioning
Project, which is a key part of the Volvo Group’s
growth strategy.
− The brands are at the centre of the Group
Trucks organization. By aligning the brands, we
are going to increase our market coverage and
be able to sell trucks to a broader customer base,
says Olof Persson, President and CEO of the
Volvo Group. Furthermore, we will be able to bet-
ter utilize the strategic assets we have built over
time – our customer relations, scale, industrial
footprint, distribution networks and supply chains.
In some countries, we may even be able to add
additional brands from our portfolio to an existing
network base, which will grow and strengthen the
business of our dealers.
Since taking the strategic decision to focus on
commercial vehicles, the Volvo Group has built a
strong portfolio of truck brands, including Renault
Trucks, Mack, UD Trucks, and of course Volvo, as
well as a joint venture with Eicher Motors in India.
Over the past decade, the Group has also invested
heavily in developing technology platforms, cus-
tomer relations, a global industrial footprint and
global distribution networks.
Until recently each truck brand has been
operating relatively independently and often in
the same segments. By aligning brands so they
focus on different segments, while also sharing
resources and networks, the Volvo Group can
better leverage its assets in the brand portfolio.
− The brand positioning project is extremely
important because we’re taking the Volvo Group
into a completely new phase, says Peter Karlsten.
− We are going from a brand-by-brand strategy,
to having a full brand portfolio and taking a com-
pletely different approach to the markets.
Joint view on markets
The first step in the brand positioning project
was to define market segments, so that the
entire group views the market in the same man-
ner. Group Trucks has agreed on four key seg-
ments of the truck industry: basic, value, high-
end and premium.
− By combining the brands and networks we
open new opportunities, stresses Peter Karlsten.
− For example, currently most of our brands
are in the high-end or premium segments, while
there is an empty spot in the value segment –
this represents a great opportunity.
Under the new plan Volvo and Mack will con-
tinue to service the high-end and premium seg-
ments. Outside of Japan, UD Trucks will focus
on the value segment, while UD Trucks in Japan
remains in the high-end segment. Renault
Trucks will concentrate on the high-end seg-
ment and will stretch into the value segment.
Eicher, which currently services the basic seg-
ment, will also stretch into the value segment.
With each truck brand being assigned a specific
segment and customer base, Group Trucks can
increase its market share, and contribute to the
overall growth of the Volvo Group. The brand posi-
tioning project has also provided valuable input
when the Group Trucks organization was design-
ing road maps to reach their strategic objectives.
− We now have a very clear view on where
we are going and how we can do things in a
more efficient way, says Olof Persson. This is a
new ap proach and it will open up fantastic
opportunities.
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