Volvo Wants Ruggedand Safe

Struggling Volvo shifts its branding strategy to convince buyers it's more than just a Swedish "minivan"

In a new ad for the Volvo V70/XC70 crossover sport-utility vehicle (psssst…it's really a wagon), a couple that look as though they strolled out of a backpack ad in Outdoor Life drive the vehicle over mountain roads and down a hill off-road to an adapted song based on the kid's tune Wheels on the Bus. In another TV ad, for the S80 sedan, we see a riff on a Pierce Brosnan James Bond movie action sequence.

If the ads, from Volvo's new ad agency Arnold Worldwide, seem disjointed and unconnected, they're not. What the Swedish carmaker is after in the new brand positioning and ad campaign is to add some ruggedness and a bit of adventure to Volvo's well-established reputation for building vehicles that are extremely safe to drive. If the new Volvo image desired by the company and the agency were manifested in a single couple and family, it would be, I think, Brad Pitt and Angelina Jolie, iPods set to Natalie Merchant, walking with their children to the set of a romantic action movie they are shooting in the Himalayas. The word "soulful" must have come up a lot in Arnold's PowerPoint presentation to Volvo.

Viewed as a Minivan Brand

Volvo for years has been a problem brand for its Swedish management and American owner Ford Motor (F). It has an almost indelible brand image with car buyers in the U.S. and Europe as a vehicle you buy after you have kids. Whether the current vehicles are substantially safer than Hyundai (HYMLF), Mercedes-Benz (DAI), Chevrolet (GM), or Ford is open to debate. But the fact remains if you ask consumers to associate a brand with trust and safety, Volvo handily wins that battle.

Every car company strives for clarity of brand like Volvo's. So what's the problem? For one, tougher safety regulations and the proliferation of air-bag technology in most vehicles have watered down Volvo's advantage in the minds of many when it comes to safety. And even though Volvo does not sell a minivan, in the minds of many, especially men, Volvo is a minivan brand. And for many, the minivan is a badge not of soccer-mom honor, but of sacrificial parenthood. In other words, "I really can't have it all if I have to drive a minivan, or a…Volvo." This is the mindset Volvo and Arnold are combating.

Another problem for Volvo is it is neither a mass-market nor luxury brand. It's premium. "Premium" in the car business means I have to pay more than I would for a mass brand, but not to enjoy the status of luxury. It's tough being in the middle. Volvo is also amid a launch of the C30, a sporty hatchback, to draw in single people, younger buyers, and Volvo devotees who need a second car not quite as utilitarian as the wagons or XC90 SUV.

Between Profit and Loss

Indeed, Volvo sales have been unremarkable. In the U.S., sales are down 9.5% this year despite the new S80's launch. Since Ford acquired the Swedish car company (Ford does not own Volvo heavy trucks) in 1999, the division has wavered between acceptable profitability and loss. Who needs that financial performance when Ford has Lincoln to perform in mediocre fashion? In fact, Ford is currently studying whether to sell Volvo to another carmaker or to a private equity firm to see if someone else can make a buck from a company based in Sweden and a culture where no one ever gets laid off no matter how business is doing, and people eat shark meat at family celebrations. The likelihood is Volvo will be sold.

Despite rhetoric from Ford the past several years about engineering synergies between Ford, Lincoln, and Volvo (vehicles such as the current Ford Taurus, Taurus X, and forthcoming Flex crossover are built off the old S80 engineering platform), the truth is Volvo's engineering culture and apparatus is incredibly difficult to integrate with Ford's, and using Volvo engineering platforms at Ford has saved the company very little.

The new TV ads, then, come at a time when other carmakers and financiers are literally kicking the tires on the whole company. The TV ad set to Wheels on the Bus is a good example of how Arnold is out to strike the balance between safety, adventure, ruggedness, and kids. It's also a terrific case study in how to incorporate actual product benefits into an ad that is entertaining to watch. The couple picks up a fellow hiker and pushes the button for the power liftgate. The song lyric becomes "The power tailgate goes up and down, up and down, up and down…" They drive gently down a steep hill under total control with no wheel skid, and the lyric shifts to "The hill descent control goes nice and slow, nice and slow, nice and slow…"

Not for a Football Audience

None of the men in these ads look as if they are apt to be watching Monday Night Football with their pals over a six-pack of Molson. They all seem too pretty attentive to their wives for that. And I suppose that's the way it's meant to be in a Volvo ad. These ads are aimed at making Volvos seem very un-minivan-like to both men and women, but they are especially designed, it seems, for men to feel like they might be more attractive to their wives if they were the kind of men who could be happy in a Volvo with them out on a picnic or a rugged trek to the top of a mountain instead of driving a Lamborghini to watch the game on Monday night.

Whether the new positioning takes hold and increases sales and consideration will take at least two years to determine, though I doubt Volvo's owners—Ford or a new company—will wait that long to try and find out. One thing is for sure. The depth of Volvo's brand image is incredibly valuable. The company just has to get the attention of more people who like what it stands for.

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