Benefits and utilities for the customers from launching VolvoNet

Consumers get more and more accustomed to using the Internet for seeking information. As the Swedish auto industry enters the Internet market it is essential to capture the consumers attention and interest. The actors on the market must therefore give the consumers good reasons and incentives in order to make the consumers visit their web services.

In this section we will point out the customer benefits that are unique for VolvoNet. As we have not been in contact with any customers that have used the Belgian VolvoNet we have described below the benefits that we have found
possible and reasonable. The benefits described can only be utilised by the customers if they go through VolvoNet, or at least the benefits will have greater implications when they are using VolvoNet. These benefits are also of interest to Volvo as they indirectly benefit their business.

Convenient and comfortable services

These benefits facilitate the information gathering and buying process. Extensive information and services are provided in a convenient way.

VolvoNet provides comprehensive and complete information

VolvoNet provides more information about Volvo cars than any other site. Thus, VolvoNet can assist the customer to a buying process where the dealer’s influence on the customer is less than for customers who are going through a
third party broker or using traditional channels. VolvoNet empowers the customer, so to speak. If you can configure all optional attributes of the car on the Internet it is possible for the customer to decide what configuration to purchase even without visiting a dealer. Thus, the customer has the freedom to decide upon what model to buy and how it should be configured without being informed or influenced by a dealer. Hence, avoiding the feeling of being talked into buying more than needed. A condition for being able to make a decision so early is that the information on possible configurations is comprehensive. VolvoNet’s information, when it comes to Volvo cars, is as comprehensive as you can expect in such an early stage. The third party brokers existing as of December 1998 in Sweden, on the other hand, have a lot of information about several different car makes. But, since they are offering such a wide range of makes they cannot be expected to be as comprehensive as VolvoNet for every single make and model. Thus, a customer who goes through a third party broker can decide upon a car before arriving at the dealer location. But if the information is not comprehensive there is a risk that the customer finds out at the dealer that there are more alternatives of colours, engines, optional packages etc., and thus find themselves, once again, under the influence of the car dealer.

The information avaliable when e.g. comparing cars between different makes is delivered by an independent information provider, (JATO). By having all information and services for Volvo cars concentrated to one site, the customer does not have to visit several different sites before being able to make a decision. The possibility to compare the price and configuration of Volvo cars to other brands and models makes it less necessary for the customer to visit other car manufacturers’ sites. This results in time saving for the customer and thus makes the
process of information gathering prior to a purchase decision easier.

The utilities derived from this benefit are thereby customer empowerment and saved customer time.

VolvoNet allows customers to book a test-drive

The customer can book a test-drive online by filling in a form giving information on how she can be contacted, as well as the preferred day, and time of the day. This makes it possible for the dealer to better prepare for the test-drive and can thereby serve the customer in a better way. By booking the test-drive in advance the dealer can put the model the customer wants to test-drive aside, and the customer knows that the desired model will be available. It is possible to book a specific model such as V40, C70 or S80 and to choose petrol or diesel engine online, but it is not possible to book a specific engine (2.0 litres or 2.5 litres etc.) or configuration.

VolvoNet allows customers to choose dealers

There is a difference between how different brokering services choose which dealers should be allowed to send an offer to the customer. Both Autobytel.se and Bilweb have some criteria for choosing between dealers’ offers and does not let the customer choose her own. (For a more detailed description see Autobytel.se and Bilweb respectively.)
By choosing for the customer, the service prevents the customer from choosing a specific dealer, one that maybe does not have the best offer according to the broker’s criteria. But the customer does not necessarily want to choose dealer from the same criteria. On Bilweb, the customer can choose which criteria too choose dealers from; delivery time, concordance of model, or lowest price. But due to the fact that Volvo only builds cars upon order, all Volvo dealers have the same delivery time and an exhaustive range of models (Eneqvist, 25/11/98). Thus, the real difference is only the price when it comes to Volvo cars.

When using VolvoNet the customer can choose any dealer connected to the service. Thereby the customer can be
contacted by the dealer that fulfils the customer’s criteria whether it would be a familiar dealer, a low price, or a
convenient location. The fact that Volvo will try to connect every authorised dealer to VolvoNet (Illes,07/12/98) implies that there will be a large selection of dealers to choose from. As a comparison it can be mentioned that Autobytel.se will connect all Bilia dealers and are not interested in connecting private Volvo dealers located geographically close to Bilia dealers for obvious reasons. As an example, Lööv does not expect to be invited to join Autobytel.se due to his geographical location, close to Bilia dealers (Lööv, 24/11/98).

VolvoNet offers online ordering of brochures

Reading a lot of information about different models on the web has its advantages, but some customers still prefer reading a brochure. Although the Internet is a convenient medium there are people who prefer to read longer texts on paper print and there are situations when customers want to be able to read the information away from the computer. On VolvoNet, the customer can order brochures for every Volvo model on sale. Hence, the customer can receive a brochure without having to visit the dealer or make a phone call. It is convenient for the customer that, if she chooses to read a paper print, she can receive a brochure conveniently.

Brand and image

By the use of the Volvo brand on VolvoNet the customer is communicated the image of the brand and what it stands for. The use of a brand can help the customer decrease the perceived risk but also, hopefully, communicate the image that the customer desire.

Volvo’s well-known brand name decreases customers’ perceived insecurity

When doing business with a company with a well-known brand name you have a rather good idea of what you get. The Swedish customers know what the brand Volvo stands for. A well-known brand that is famous for its high security standards will decrease the customer’s sense of insecurity that is more or less connected to all kinds of purchases (Kapferer, 1997, p.30). An unfamiliar brand, like for instance Autobytel.se, cannot be used to lower the risk since it has not developed an image in the customers’ minds. Thus, using a web service with an unknown brand is connected to a higher risk. Hence, the customers are less probable to use such a service but rather rely upon established brands with less perceived risk.

The fact that VolvoNet dealers are authorised by Volvo can also decrease the risk and feeling of insecurity for the customer. A customer can be assumed to better trust a dealer connected to a car manufacturer’s service, such as VolvoNet, than a dealer connected to any third party broker due to the reassuring effect of the established brand (Kapferer, 1997, p.30). When using VolvoNet everything is connected to Volvo; the car, the dealer, and the site. Thus, the brand name’s reassuring effect affects the customer throughout the buying process.

The sought modern image of VolvoNet is coherent with the sought image of Volvo

The image is an important factor when buying exclusive cars. A buyer of an exclusive car does not want to buy his car in a showroom that also shows cheap makes. (Otterbeck, 09/11/98) As an example, Toyota who owns Lexus (which is marketed as an exclusive car), uses another distribution net for Lexus cars than for Toyotas to differentiate
their brand names. They use specific Lexus dealers and attempt to remove the connection to Toyota (lexus.vicinity.com/lexus).

Branded products may be used for transferring the image of the product to the buyer. Thus, a buyer of an exclusive car is looking for a car that possesses positive and desired properties, i.e. the image of the car should be coherent with the desired image of the customer. (Kapferer, 1997, p.30.) As we have mentioned earlier, Volvo has been trying to change the identity of their cars and thereby the way customers perceive the image of the cars. (See section VolvoNet enhances the image as a company of the future for details.) The image of being a modern car manufacturer can be enhanced further by the use of the Internet as a brokering channel, as well as by the relatively advanced possibilities for configuring the different models. In other words, VolvoNet must convey an image coherent with the image conveyed by the cars. You could compare this with having the same image of the product and the
store; if the product image and the store image is coherent the total effect of the image is enhanced (Assael, 1995, p.136). By enhancing the image, the customer’s self-image is also enhanced (Kapferer, 1997, p.30). The utility for the customer is thus that VolvoNet makes the image conveyed to the customer more distinct.

Increased price competition makes haggling margin disappear

As of today, dealers have a haggling margin on their price to the customers (Eneqvist, 25/11/98). That is, the price can be negotiated to somewhere within this margin without the dealer making a loss. Due to the increased price competition caused by the new brokering channel, Internet, this margin will probably disappear and so will the haggling process (Eneqvist, 25/11/98). The price in the dealers’ offers and showroom will be non-negotiable. This
benefit does not only lower the price, it also decreases the risk of the customers feeling that they have been fooled. The possessed amount of information becomes more equally distributed between dealers and customers and thereby, the car purchase becomes more of a fair play.