Volvo Car Corp. plans to increase sales and promotion with its outlined changes to its global marketing strategy on Monday. The Swedish automaker will progressively introduce web sales and spend more on digital advertising.
Volvo Car Corp, controlled by China’s Geely, said it will start selling vehicles online as it rolls out new models to compete with German luxury rivals such as BMW. Volvo sales Chief Alain Visser said “The plan is to have all our car lines in all our markets offered digitally.”
In August, Volvo launched a revamped XC90 crossover, the first vehicle developed under Zhejiang Geely Holding Group ownership. Volvo has raised its 2014 sales goal with its flagship SUV and other models, boosting features and glamour to attract Chinese customers without losing sight of core qualities including safety and neat Scandinavian design.
How effective will online sales be with vehicles?
Volvo says 80% of its customers already shop online for other goods and research suggests many will do the same for cars in the future. Volvo has 2,000 global dealerships, half of which are in Europe. Most dealerships are skeptical of the idea of selling units through the internet. Although Volvo has assured its dealerships explaining that the online sales would still stream through their showrooms. “We don’t see a car distribution network without dealers in the foreseeable future,” the sales chief said, adding that vehicles sold online “will still pass through the dealer network” for delivery.
The company plans to withdraw from all but one motor show per year in each of three regions – Europe, North America and Asia – and stage its own global event instead.
Some analysts are doubtful of online sales in the industry. “BMW has tried it in Germany, but they really haven’t had a huge amount of volume,” Stuart Pearson of Exane BNP Paribas said. “People still want to go into dealers.” Pearson cited weak orders from experimental online sales of the BMW’s i8 hybrid sports car.