Any other business
The “Simply Clever” approach Skoda has to hijack customers from Ford and Vauxhall
9 min read
04 August 2015
Patrick McGillycuddy, the head of fleet at Skoda, jumped into the driver's seat and talked to us about the journey so far, the road ahead and its “Simply Clever” approach to business.
Real Business had the privilege of attending Skoda’s launch of its all-new Superb in Inverness this month, gaining valuable insight into the company’s operations and why the vehicle is deemed its “best ever”.
Following our trip, we’ve already established that Skoda took its marketing strategy to new heights with the creation of a village dubbed “Skodaville”. It showcased ambition and creativity that one may not immediately think of when Skoda springs to mind, and really captured the “Simply Clever” innovation that the new Superb has been laced with.
Skoda’s media relations manager Krystyna Kozlowska told us that the concept was inspired by The Stepford Wives. Explaining why, she said: “Everything there was perfect and beautiful, very well-defined. Life was perfect and that’s really the inspiration behind Skodaville – in a perfect world, every house would have two Superbs or Skodas on the driveway.”
Interestingly, businesses are going to be the main focus for the Superb, with 70 per cent of the sales expected to be generated from the fleet division.
Fleet boss McGillycuddy said that’s a result of a maturing segment. “These type of cars are traditionally sold in corporate sectors, from small SMEs up to large corporates, and that’s because it’s the type of car that suits their needs,” he said.
“We think we can hold on to current customers very well and win more and more customers from that traditional heartland of company car drivers, so targeting the [Ford] Mondeo and [Vauxhall] Insignia.
“Historically, we’ve had strong sales in fleet for this model and we see that getting stronger with the new model. It’s a more compelling product than its successors and it’s more design-led. We can be more competitive in the marketplace as the car has great residual value.”
With history in mind, Czech business Skoda is 120 years old and boasts a wealth of engineering experience. The original Skoda Superb debuted back in 1934 and was adopted by high society and politicians, selling 600 vehicles.
Fast forward to the 90s and Volkswagen Group – also the owner of Audi, Bentley, Porsche and Seat – took a 50 per cent stake in Skoda, before making a full acquisition in 2000.
With the German giant behind it, the 2001-2008 version of the Superb sold 13,000 units, rising to 29,000 for the 2008-2015 model. Now, the latest edition, dubbed the “best ever” is set to continue the trend and beat previous milestones.
Read more on the car industry:
- If Tesla can build 500,000 driverless cars by 2020, then Uber will buy them all
- Tailing motoring giant BMW’s race into the UK’s sharing economy
- Ford, Vauxhall, Volkswagen: How UK’s best-selling cars rose to success and plan to stay there
With Skoda growing by 68 per cent between 2011 and 2014, McGillycuddy said the firm is confident about the new Superb as it symbolises where the brand is going. “It brings together our traditional position of having great quality cars that are practical and spacious, that often have great value for money, and it’s great looking on the outside as well.”
Describing it as an an “emotion and design-led feel”, the Superb uses the latest technologies from Skoda and Volkswagen, harnessing the latter’s MQB platform to bring the best engineering and infotainment systems to the vehicle, which he believes creates an “all-round compelling package.”
There’s an obvious sense of pride to what the company has created, as McGillycuddy emphasised the car “takes us into the new era”. As such, innovation has been highlighted as a key factor for the creation of the car and the journey ahead.
So many highlights to our brilliant week in SKODAville for the new Superb launch. Even the parents showed up… pic.twitter.com/jrVdmvroXP
— ŠKODA UK Media (@SKODAUK_Media) July 24, 2015
“Innovation for us is what we call ‘Simply Clever’. It’s how we bring simply clever things to life in how we design, engineer and build our cars,” he detailed.
“The new Superb has got Simply Clever features – for example, ice scraper in fuel filler is standard; umbrellas in both front doors; the ticket holder in windscreen, and bottle holder with suction pads for one-handed opening. We innovate in a way that brings benefit our customers – the drivers and passengers.”
With businesses set to account for a large portion of sales, McGillycuddy said the company has embarked on a local business centre programme in order to reach small businesses and understand their needs, making sure it isn’t just the large firms receiving support.
And while new product launches have played their part, it’s the business world that has been largely responsible for the increased popularity of Skoda, following on from a decision to expand its fleet division.
“As part of our growth, we recognise all channels of the industry need to grow. Two years ago we had historically been retail-dominated and recognised fleet needed to grow to sustain growth and continue growing the business, “ explained McGillycuddy.
“We had to make sure we had a fleet team speaking to decision makers more than before, so we doubled it over period.
“Now we can talk to more customers and prospects more often, and are growing that side of the business extensively. We had 40 per cent team growth last year, and 20 per cent this year.”
Customer loyalty is also equally important for Skoda, as he said providing a solid ownership experience results in retention.
“Loyalty rates are fantastic in retail and fleet. If people enjoy our products and we serve their needs well, it makes for a great ownership experience and they become great advocates, so we can grow the business even more. That’s why we’re confident of growth in a sustainable way,” he said, recognising that there are slight nuances between retail and fleet, though “ultimately everyone is a consumer.”
Things have undeniably changed at Skoda over the years, but the wider car industry is also changing with the launch of the sharing economy, on-demand services and disrupters like Uber on the scene.
Commenting on the arrival, McGillycuddy is open to collaboration rather than going to war. “I think they’re interesting and we’ll see where they go. As such, we don’t have any involvement at the moment.”
He noted the spaciousness, practicality and low emissions the cars offer and said “we can therefore take advantage of those in the high metropolitan areas, where the legislation will likely force more car sharing. We think we could be complementary and work together, we don’t think there’s a natural competition. The way we thought two years ago is different to how we think today and that’s different to how we’ll think in two years’ time. ”
With small businesses a focus in the push of its new product, McGillycuddy closed with words of wisdom for business owners. “It goes back to what’s driven growth for us and it’s the focus on customers. Really make sure customer service is great – we’re recognised for that focus in retail and fleet sides of the business. I think that’s something any business can learn from.
“Keep that customer at the heart of every decision and you’ll be successful. Don’t lose sight of the customer on that journey.”