Management training

Conflict over ‘one size fits all’

Does this sound familiar? Line manager Joe will be absent for a couple of days. The timing could have been better, but there’s no choice – he’s needed for some brand training, along with counterparts from other dealerships which have the same franchise. Assignment completed, the dealers can tick another box on the franchise agreement.   

It’s what one HR manager describes as “the sheepdip exercise – training is carried out, but is it appropriate for that particular individual?”

Another likens it to a “one size fits all” approach, with an assumption that dealer and manufacturer training templates are correctly aligned.

But there can be a perceived mismatch between provision and need and this is just one of a series of challenges facing motor retail in its attempts to improve the calibre of management skills and leadership.

AM magazine April 2013 (see archive for rest of story)

Auctions and remarketing

Smartphone boost for online dealing

If internet shopping can topple high street chains like HMV and Jessops, it’s tempting to ask motor dealers looking to replenish or dispose of stock: Why go to an auction hall? All the processes – from vehicle condition reports to the bidding itself – are now possible not just through a desktop PC; online business is being downsized to palm-of-the-hand kit. 

Auction giants BCA and Manheim, along with SMA Vehicle Remarketing, are poised to launch their hand-held services, while Eastbourne Car Auctions activated its version at the end of last year.

But auction providers believe there will a continuing need for the ‘physical’ advantages of halls. And ironically it’s communication tools like smartphones that will help to ensure their survival.

Jon Mitchell, managing director of Eastbourne Car Auctions, said latest technology offers traders a ‘belt and braces’ benefit, complementing rather than supplanting, halls. Mitchell, whose company has a joint venture role with the recently launched online remarketing company Carcom, explained:  “Typically, you will see buyers at auctions equipped with smartphones and iPads looking at a vehicle and comparing it with a condition report on screen. Perhaps the report highlights some minor damage they haven’t noticed. ‘OK,’ they’re saying, ‘let’s have a closer look at that,’ while they’re flipping between Glass’s and CAP for a valuation. Plus, you get buyers who give a vehicle the once over and then sit in the canteen because they don’t want others to see they are bidding.” 

Commented Tony Gannon, communications director of BCA: “Auctions are not just about selling, but the logistics of vehicle movement, storage and prep. A dealer gets the trade-in on Saturday and wants it gone on Monday. Online bidders still want the reassurance of seeing other bidders in the auction hall.”

 Gerry Lynch, chief executive of Carcom, added:  “Like any other business, there is always a need to get out of the office and make human contact. And auction halls give you the opportunity for some tyre kicking, especially with older vehicles.” 

AM magazine Feb 2013 (see archive for rest of story).

‘Storytime’ tip for oils and lubes

 Service advisers should ‘tell a story’ when it comes to selling oil. Not in a fictional sense, but as a means of increasing a car owner’s awareness of the value of a particular brand.

As Castrol’s Nigel Head explained: “Rather than just hand the customer the service invoice and ask for method of payment, it’s important to explain what’s been done – especially when it comes to an oil change. So the conversation (at a BMW dealership)should be along lines ‘we’ve drained off your old oil, replaced the filter and re-filled with Castrol Professional, the only oil recommended by BMW...’.”

Head, Castrol Professional OEM and franchised workshop marketing manager, added: “From a marketing point of view, oil is in the low interest category. There’s a vacuum of knowledge, so the temptation is to go for lowest price. Hence the need to build a story round the product’s refinements. Other oils may meet manufacturers’ spec, but there are degrees of tolerance. Castrol Professional is endorsed by no fewer than 10 car manufacturers.”

AM magazine

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When I last met Bob (not his real name - he wishes to remain anonymous) for a reunion drink, we ended up chorusing: 'We had the best of it.' The days when PC was a copper's rank, passive smoking was a no-cost alternative to a packet of Woodbines and before women wore tights.

We both left secondary school and began as junior reporters in the same newspaper group - Bob on a weekly in Peterborough and me on another weekly in Whittlesey, a market town seven miles away. I swear I got the job because the owner, a charming old gentleman by the name of Algernon Sharman, gave me some dictation which included 'building site' from a speech by Stanley Baldwin. After noting that I had spelt 'site' correctly, he took me on a terrifying 80mph drive in his Daimler along Fenland roads from head office back to Peterborough, my hometown.

So Whittlesey is where I learnt my trade. Bike rounds to pubs for darts results, the football team managers for match reports and the Women's Institute secretary, whose bosom was a distraction while I dutifully noted that 'tea was served by Mesdames...' Names spelt correctly was always more important than any real news coverage - standing outside churches to compile lists of funeral mourners, I found myself parroting: 'Is that Brown without an E, Smith without a Y?'

As for all those wedding reports, I have two abiding memories. No, not Abide with me, but Fight the good fight chosen by one couple, with another bride describing part of her outfit as 'a Dutch cap trimmed with lace'.

Then it was on to Peterborough to join Bob and to discover that I lacked an instinct essential to any reporter - er, news sense. It came during a council meeting when a council house tenant asked for a move to another property with a bigger drive to accommodate his two cars - this at a time when one car per household was a rarity. I was astonished when my report ended up as a page top in a couple of the tabloids, courtesy of ex-Mirror reporter turned Peterborough-based freelance, Rex Needle.

Meanwhile, Bob distinguished himself with a report about price inflation in pre-decimalisation days with a quote from a local butcher: 'Yes, I've had to put my meat up a few coppers.' Bob also doubled as the entertainment critic and, after seeing an up and coming group at the Embassy Theatre, pronounced them 'mediocre'. Perhaps The Beatles were having an off night. Once, when Bob was on holiday, I had to cover an am-dram production of West Side Story. Highly entertaining, but for all the wrong reasons. It took the male lead three attempts to scale a chain link fence before the Jets/Sharks fight scene and the poor fellow also had a lisp, which resulted in an unusual rendering of the song 'Maria'.

From Peterborough, it was on to the Bristol Evening Post for 18 months, and then to the Hitchin and Luton offices of the Hemel Hempstead-based Evening Post, Thomson training ground for a clutch of graduate trainees who went on to make names for themselves, including Anne McElvoy, Alan Hamilton, Tony Holden and David Blundy.

I made a name for myself by leaving Luton magistrates' court one lunch time with a tremendous thirst, ignoring all the police cars outside a local bank, and next day discovering that it had been the target of one of the biggest safe deposit box raids of all time. No surprise that I lost my stripe as crime correspondent, but not before I had the chance to mingle with Fleet Street's finest covering the Muriel McKay abduction and murder story. Jimmy Nicholson, if you happen to be reading this, you never did return the wellingtons I lent you for tramping round the fields of Stocking Pelham, scene of the McKay crime. Rotter.

A couple of other anecdotes during my time at the Evening Post: One of the junior reporters at the Hitchin office lost a contact lens, which I found in a waste paper basket. 'Thanks,' said the grateful junior, I owe you one.' Well, John Blake, now head of the eponymous publishing house, it so happens that I've just completed what I believe is a blockbusting novel...

And Irene Gibb, before your move to the Daily Mail, do you recall the time you picked me up one morning in what appeared to be the district office pool car, a green Vauxhall Viva? I say 'appeared' because this vehicle was in pristine condition. Intrigued, I opened the glove box and found a Bible. Now bear in mind that this was in the days when car anti-theft devices were less sophisticated than today. Turns out that there were two green Vivas left overnight in Luton's multi-storey car park and the ignition key of the pool car just happened to fit the other, belonging to a church minister.

Then I hit Fleet Street. It was more of a plop, really, during the dying days of the IPC Sun doing the worst job possible for someone with no news sense, copy tasting. It was my task to condense any agency copy I thought merited inclusion on the morning news schedule into a couple of sentences. News editor Barrie Harding, the former Mirror bureau man in New York, would invariably look at my contributions while sucking on a toothpick (having just given up his 60 a day fag habit) and spike them.

I still cringe at the recollection of newsdesk colleague Bill Newman explaining the rudiments of the job on my first day. 'Oh, I'll soon pick that up,' I responded. His expression was something along the lines of 'What arrogant young prick have we got here, then?'

Someone arrogant - and stupid - enough to commandeer editor Dickie Dinsdale's chauffeur driven car to take me to the station at the end of one night shift. That really marked my early departure ticket. But not before I accumulated some notable memories of characters and events. Science/medical correspondent Leslie Toulson, with his accordion playing at the Cross Keys, opposite the Sun offices in Covent Garden. A floppy haired reporter with owl glasses and a wonky eye, but his other eye was good enough to see him make it into the media stratosphere: chap by the name of Les Hinton. Aviation correspondent Brian Woosey, who gave me my first experience of nightclub hostesses - thanks for putting my excesses on your exes, Brian. Feature writer Jon Akass, whose one line intro on the investiture of the Prince of Wales - 'The lad did well' - would have been envied by Ernest Hemingway.

But a callow youth having a crown placed on his head by Mummy was insignificant compared with two other events during my newsdesk shifts. One was the first bomb attack in Northern Ireland, with managing editor John Graham later signing up Westminster's youngest MP, Republican activist Bernadette Devlin, as columnist. The second, for which I still have the PA 'flash', was the Apollo moon landing, which a gang of us watched on a flickering TV screen in the private quarters of Annie, landlady of the Cross Keys.

From the Sun, it was on to a brief spell at the Daily Sketch as a reporter, where the only incident I recall was being told to f*** off by Foreign Secretary George Brown during a doorstepping assignment, before I left newspapers for the more leisurely pastures of business magazines.

Ironically, it was during this time that a story of mine - an exclusive interview with union boss Hugh Scanlon on wage bargaining - made a Sun splash. I didn't get paid for that, but I've since made some drinking money from the occasional story: the Punch and Judy man who whacked a local farmer for 'goosing' him during his act; Bishop Desmond Tutu being let off a parking ticket by an admiring traffic warden; and a man at my local pub who foiled a speeding fine after persuading police that the real culprit was someone driving around in an identical car using his number plate.

Nothing to rank as scoop of the year, but they serve to reassure me that perhaps I do have some news sense after all...

 

 

 

 

Who wants to be an engineer?

Not aspiring millionaires, that's for sure, as talented school leavers and university graduates are lured to the richer grounds of financial services. But pay is not the only issue as industry struggles to fill engineering vacancies. Confusion over the definition of an engineer seems to compound another problem - its lack of status in society's pecking order. 

Motor Industry Magazine

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Andy Dunsdon, Kia’s new rental and leasing manager, says he is determined its dealer network benefits from the aftersales business generated by its fleet offensive.

“We’re considering ways in which its ‘Care-3’ service package, currently restricted to retail buyers, can be integrated into fleet deals,” he said.

Over the past five years Kia has increased its share of rental/fleet business as a proportion of total sales from 30 per cent to 40 per cent.

AM magazine

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How many cars have you sold today, dad?

When Darren and Katie Williams took over a SEAT dealership in Essex, one of their first tasks was to cut down a hedge surrounding the forecourt. "It was so high, passers-by couldn't see the cars - not that there were many to see," recalled Darren. "Not a good thing if you're in the business of retailing."

See archive for rest of story

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Customer retention: It's good to talk

  • That old saying ‘You can lead a horse to water, but you can’t make it drink’ seems especially relevant when it comes to dealers keeping in touch with customers.

    As Sue Myers, director of sales pro-cess, funding and insurance at the Marshall Motor Group, said: “Technology can aid communication, but can’t drive it – that has to be down to good old-fashioned people management.”

    Myers said the company’s dealer management system had its limitations.

    “It’s great at flagging up when to contact a customer, but there’s nothing to stop a sales exec simply moving that task to another day.”

    AM magazine

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    Apprentice cash dilemma

    It’s an all too familiar story. When times are tough, one of the first casualties –  along with redundancies – is the company training budget.

    But first, the job losses. Latest research from the Institute of the Motor Industry makes for grim reading. Redundancies in the automotive sector shot up by 55 per cent last year, compared to 2007. For the first quarter of this year, the redundancy rate was even more shocking – 182 per cent higher than for the corresponding period last year.

    ‘Skilled trades’, which make up a third of occupations within the sector, bore the brunt of the losses (45.5 %), prompting IMI research manager Alison Rhodes to comment: “If this trend continues, it could have a substantial impact on the sector’s ability to come through the recession and capitalise on future opportunities.”

    As for the impact on training, she says the picture is “mixed”, explaining: “There is evidence of employers not planning to take on new apprentices, or having to make existing apprentices redundant in the coming year. There appears to be two groups of employers emerging: those who believe that ‘now is the time to train’ as business is slower and those who view training as an unnecessary spend in time of this recession.” 

    Motor Industry Magazine

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    Hit the phones, Jack! 

    With the economy in the doldrums, businesses should be ‘hitting the phones’ to put more wind in their sales.

    Yet according to one study, the automotive sector has a lot of catching up to do when it comes to communicating with existing customers and chasing new ones.

    Only 50 per cent of marketers from Britain’s top 1,000 companies reckoned that carmakers and dealers use multi-channel communications effectively. Top of the league were travel, mobile telecoms, retail banking and insurance.

    Motor Industry Magazine 

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    At last, recognition for talented managers

    On the face of it, the evidence is damning: Less than 18% of managers in motor retail have a formal qualification compared with an average 45% across other industry sectors. But as Chris Hayden, chairman and chief executive officer of Ford Retail, points out, that doesn't mean businesses are being run by people who lack skills and experience. "There are a lot of incredibly successful people in our industry. Many of them left school with no qualifications and that hangs over them, but it shouldn't because they are very talented," he said.

    It's this disparity between ability and qualifications that the IMI is now aiming to put right with the launch of its Automotive Management Accreditation scheme.  Developed over the past three years, it's based on principles similar to Automotive Technician Accreditation (which now has more than 22,000 members on its register) to assess job competence and identify any need for skills development.

    Motor Industry Magazine

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    Brand stretch - can it take the strain? 

    Not content with sweating their assets, auto makers are heavily into another area of business aerobics known as 'brand stretch'.

    Though this particular work-out has been prompted in large measure by toughening price competition, it's by no means a case of everyone doing identical exercises.

    Contrast Mercedes, stretching down to the A-Class, with Skoda - rejuvenated under Volkswagen - stretching up into Mondeo territory with Octavia. The Vauxhall badge, hitherto confined to the family and fleet sector, has been stretched to take in the VX220 roadster, while Porsche, the embodiment of sleek, road-going performance, prepares to extend its brand into the rugged Sport Utility Vehicle sector.

    BMW, meanwhile, has decided that knees bend goes no further than its 3 Series compact, with Mini retaining its identity, while arms up under the oval badge stops at the Mondeo. Ford's five prestige marques, though corralled in the Premier Automotive Group, all retain their separate brand names. Though it may be superficially attractive for a manufacturer to strengthen and broaden its brand, industry sceptic Professor Garel Rhys argues that it's a way of introducing a market imperfection.

     "It's an attempt by manufacturers to insulate themselves from the full blast of competition where prices are mainly 'made' by the market and not by an individual supplier." Rhys, professor of motor industry economics at Cardiff Business School, added: "The reason for the current frantic interest in brand is simple - the ability to 'make' prices is being eroded and carmakers are desperate to prevent the loss of net revenue that the more competitive market is bringing."

    Given that most products - whether they be cars, mobile phones or washing machines - have much the same functionality, irrespective of their maker, it's not surprising that the logos attached to them have assumed an almost deified role, says John Williamson, a partner with brand consultancy Wolff Olins. Where companies were once assessed on the basis of traditional assets like factories and inventories, they are now scrutinised for brand value. Even that phrase beloved of company chairman - "our greatest asset is our people" - was being subjugated by brand.

    But how do you put a price on something that, as Williamson describes it, "is the intangible, emotional embodiment of a rich mixture of ideas, propositions, personality, vision and values"?

    Another consultancy, Interbrand, in conjunction with Citibank, has taken that rich mixture to compile the World's Most Valuable Brands survey. US companies, led by Coca Cola and Microsoft, dominate the rankings, accounting for 42 of the top 75 places. But while Ford, in 7th position, is the auto leader, it's the only US carmaker to feature in the latest list. Mercedes occupies 12th position, followed by Toyota (15), Honda (20), BMW (23) and Volkswagen (31). As part of the exercise, brand value is calculated as a percentage of market capitalisation. In Ford's case, it works out at whopping 75 per cent, just behind Heinz.

    Commented Interbrand president Martyn Straw: "Translating brand power into economic value begins and ends with a focus on brands as corporate assets. Companies that outperform their peers in brand value creation understand this well and proactively manage their brands as they would other key strategic assets of the company....."

    Brand care was likened by the marketing director of one car manufacturer to handling of a camp fire in the middle of winter: "It takes a lot of time and patience to get the fire established and only a little neglect to see it go out."

    Attempting to stretch a brand beyond its established consumer perceptions, then, could be akin to lighting that fire with green logs. Witness Virgin, emboldened by its step from records into airlines, wandering off into the quicksand of soft drinks and trains. Or Marks and Spencer, struggling to get back into shape after St Michael was stretched from clothing into financial services, food and furnishings.

    Steve Saxty, automotive practice leader at the FutureBrand consultancy, says that while these are cautionary examples, the risk is even greater for carmakers. "The investment is higher, not just in financial terms up front, but also the long term pay-off. None of the 'new' or stretched brands will see effective returns inside the first model cycle. This implies that it is better to concentrate on servicing the core brand first - as Mercedes has done - before branching out."

    According to industry consultant Mike Banks, a former marketing director at Fiat UK, carmakers stretching down are on safer ground than those stretching up. "I can't think of a case where a manufacturer has successfully moved a brand above a point where the consumer has identified it," said Banks. "Nissan, under Octav Botnar (the colourful boss of the UK import business until Nissan took control of its own distribution), established a reputation for a marque which was not very exciting but offered value for money.

    "Then a more orthodox management took over and attempted to move the brand more upmarket. Since then Nissan's UK market share has more than halved. Financial people think they can achieve economies of scale by pushing different market sector products through the same distribution channels, but it's not as simple as that, and there's always a danger of over ambitious market positioning." Steve Saxty tends to agree with the stretch down safety principle, but what really interests him is the emergence of 'new' brands at the top of a manufacturer's portfolio (VW/Bentley) and at the bottom (DaimlerChrysler/Smart, BMW/Mini).

    "It shows that core brands are no longer being stretched to their previous extent. The next A-class is more B-class, so Mercedes probably stretched down too far - A-class would have been better sold under Smart," said Saxty. Mike Banks believes that Volkswagen's clutch of brands is becoming reminiscent of badge engineering during the BL era in the 1970s. Matthew Draper, a director of marketing services company Total Research, hinted at the same thing on a personal level when he remarked: "I drive a Passat estate with Audi rings under the bonnet!"

    Chris Craft, Volkswagen head of marketing, brushed aside Banks' disquiet by pointing to growth in all the company's sectors. "With Golf the centre of gravity, we have stretched up and down. Our brand is not about overt status, it's a statement about product excellence," he said.

    Where experts do tend to agree is on the deftness of brand management by Ford. Commented Matthew Draper: "Granada and then Scorpio in the premium sector and models like the Cougar were clearly not cutting the mustard and Ford recognised that there were limits to the oval badge."

    Mike Banks added: "Ford were right to acquire a clutch of up-market brands and not overtly bring them under their brand." He also says the company's move to display these brands under one roof is acknowledgment of a long-overdue reform at point of sale. "Manufacturers' franchised showrooms are not related to consumer needs. The customer wants to see a choice of makes and models of a particular type within a particular price range."

    Two contrasting approaches to brand management are provided by BMW with Mini and Porsche with its impending Cayenne SUV.

    "BMW is perceived as a serious business car with good, solid values, whereas the Mini is a fun car, reminiscent of the swinging 60s," said Matthew Draper of Total Research. "Given these differences, it is probably wise of BMW to distance themselves from the Mini, brand-wise, in case the venture doesn't work out."

    Porsche, according to Steve Saxty, is especially interesting because it's seeking "to jump an entire brand segment". As he explained: "Porsche messaging for the Cayenne is aimed at people in their 40s who should have a conventional Porsche but family circumstances dictate otherwise. If this gets generally understood, then it will be cool to have a Cayenne as a smarter option to the Mercedes M-class or BMW X5.

    "The risk, however, is product weakness because of Porsche's inexperience in selling in that sector - it becomes tarnished in the old segment and less than credible in the new."

    According to Garel Rhys, no brand is strong enough now to surmount market forces. "The likes of BMW and Mercedes cannot charge the price premium against their rivals that they did 10 years ago. So they are trying to put in place cost structures that will allow them to survive whatever the market throws at them. In other words, survival will be based on economies of scale from consolidation and not on product differentiation."

    Mike Banks says that with price reform, brands that have earned a living out of a 1 per cent or so market share are not going to survive. "Their demise is probably 3 to 4 years away when the industry - having passed its amalgamation and rationalisation periods - goes through its consolidation phase," he commented.

    Steve Saxty agrees with the time forecast and cites such brands as Daewoo, Rover, Vauxhall and Mazda as particularly vulnerable. Matthew Draper of Total Research believed BMW were on to a loser from the outset with Rover. "It just has such a negative image of being middle-aged and middle class."

    Garel Rhys says a strong brand is built on heritage, huge financial resources and product differentiation. "Sometimes, two of these attributes can offset weakness in the third, but not often."

    Though manufacturers may be preoccupied with brand building and stretching, Rhys argues that the entire exercise offers no benefit for the consumer and is fraught with risk for manufacturers. "If vehicle buyers learn that car producers are attempting to increase their brand values, they should head for the hills. This is not being done for their benefit, no matter what arguments are used about stronger residual values.

    "For manufacturers, a strong brand will allow them to survive in a competitive market without having to cut prices to unviable levels. That is all. Attempts to exploit a brand will be the road to over-pricing, consumer resistance and ruin."

    Just Auto April 2001

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    Cash incentive for training women

    As a former motor mechanic who now heads Lincolnshire-based Vauxhall dealer Thurlby Motors, Chris Roberts recognises the attractions of career advancement and the training that’s needed to achieve it.

    So he had no hesitation in signing up to a government scheme for helping women in the industry to improve their promotion prospects. Five of Thurlby’s 22 female employees enrolled on the Women & Work programme last year and a further seven have joined the latest phase. Among them are human resources manager Tracy Barker and HR administrator/training co-ordinator Emma Scholefield.

    See archive for rest of story

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    Tony's magic moment

    Dressed in a black cloak and top hat and with a wave of his magician’s wand, Tony Ball revealed the Mini to the motoring world on Aug 26, 1959, with the theme ‘wizardry on wheels’. But it was not just the car, emerging from a giant top hat, that astonished the audience at BMC’s factory in Longbridge, Birmingham. To demonstrate just how much could be packed into such a small space, Ball also conjured up three men, two women (one of whom was his wife with their infant son), two dogs and an assortment of luggage.

    At just 23, it was his first attempt at taking car launches “from a traditional white sheet unveil to industrial theatre”. His budget was £500, compared with the £1m he was handed just over 20 years later to organise the launch of the Vauxhall Astra.

    Motor Industry Magazine

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     'Detention' time for speeders

    Someone quipped that it was like being called into the headmaster’s study for detention.  But this was no laughing matter as we waited outside the hotel conference room waiting to be ‘signed in’.  This meant producing our driving licences, which ranged from the newer versions with photo IDs to my tatty 20-year-old specimen held together with Sellotape.

    The state of licences reflected the age spread of the group – mid 20s to early 70s. Twenty three of us in all, including eight women. But we all had something in common – exceeding the speed limit. Not by a wide enough margin to automatically incur a £60 fine and three points, or worse. Instead, we had the option of attending a Speed Awareness Course. With an attendance fee of £85, it was more costly, but the carrot was that we would be let off the three-points. As one of my fellow wrongdoers pointed out: “It’s a no brainer, isn’t it.”   

    The rules were strict. Anyone turning up late would forfeit their £85 and apart from ‘comfort calls’ and a 15 minute tea break, everyone had to stay for the entire four-hour session. We were warned that anyone ‘standing in’ for the real culprit risked a hefty fine and possibly prison and asked to switch off our mobiles. Not just for the usual reason of call interruptions, though. As Richard, one of our ‘tutors’, explained: “We have quite a number of well-known people turning up at these sessions. One was a footballer who was not best pleased someone used a video phone and put him on You Tube.”

    Rules over, we were each asked to name the location where we had been ‘caught’ and the amount of excess speed. Most were in Hertfordshire – venue for the session was the Comet Hotel in Hatfield – with the odd one or two nabbed further afield. For me, it was in Suffolk while on holiday, where a mobile camera noted that I was doing 35mph in a 30mph limit along the A12.

    This exchange of information was a chance to break the ice and for some to volunteer their occupations, ranging from a retired teacher to a psychotherapist. Graham, the other tutor, pointed out that our session looked like being a good deal friendlier than the morning one. “Perhaps it’s because of the presence of the ladies this afternoon – an all-male audience is inclined to be more hostile.”

    Added Richard: “You get some people coming here with a truculent attitude – ‘I’ve been driving for 40 years and there’s nothing you can teach me...’. The purpose of these sessions is not to give someone the opportunity to kick off. We’re not here to have rows and we’re not here to lecture you. We welcome constructive feedback and hopefully you’ll leave having learned something.”

    Next came the debunking of the belief that the main purpose of speed cameras is to generate cash rather than help improve road safety. “Before any camera can be installed, there has to be evidence that its location has been the scene of eight deaths or serious injury,” said Richard.  “So, in cases of fatality,  you might say that each one serves as a metal memorial.”

    Neither was it necessarily the case that speed cameras were the automatic default in high-risk spots. Graham cited one road near a college with accidents involving students, many from overseas. Looking at the evidence of excess speeding, the local authority calculated that just one camera would generate more than £1m in fines, but instead it decided to ‘re-engineer’ the road with chicanes and humps.

    There were a couple of ‘true or false’ quizzes, which highlighted our woeful ignorance of The Highway Coded, and an exercise that had us all fooled. It featured a diagram of a main road with several junctions. Estimates of speed restriction ranged from 20mph to 50mph until Richard pointed out that it was derestricted because there was no ‘street furniture’ – street lamps and restriction signs. That took us further into the subject of signage and helped us to understand the reasoning behind so much apparent ‘clutter’.

    Recognise this driver habit pointed out by Graham? “Typically, you won’t adjust your speed until you’re past a restricted sign, but will start to increase your speed well before you see the derestricted one. It’s a behavioural pattern – oh, no, I’ve got to slow down...goody, I can start to increase my speed again.”

    One inevitable question from the audience: Were there any instances where speeding could be justified – an urgent call to say that a loved one had been seriously injured in an accident, for example? “Yes, I can sympathise with this, it’s highly emotional, but anyone in this situation risks harming someone else,” said Graham.

    To illustrate his point, there were a couple of gruesome videos and statistics indicating a 1% fatality rate among pedestrians hit at 20mph, compared to 31% at 40mph. Hitting a pedestrian was  described as “a bag of skin, bone and tissue, mostly containing water, coming up against a ton and half of metal and plastic – no contest”.

    And what about driver/passenger injuries? Despite advances in car safety design, force of impact is  likely to scramble our brain against the skull, or slam our internal organs against the rib cage. “A lot of dead victims don’t look that seriously injured – it’s what happens inside that’s caused the damage, in many cases a ruptured aorta,” said Graham.

    With the government deciding to retain the current MoT system, it was a timely opportunity for Richard to point out that 97% of accidents were down to driver error. “The MoT helps ensure that vehicles are mechanically sound – but there’s no three-year scheme for testing the drivers.”

     And the lesson we were asked to take home with us? It’s summed up in the acronym COAST – concentration, observation, anticipation, space and time.

    Judging by the warm reception given to Richard and Graham at the close, it’s a lesson most of us will bear in mind. Except for one potential recidivist who was overheard saying: “I was caught because my speed detector was switched off. Next time, I’ll make sure it’s on.”

    MSN cars/features

     

     'Spot the badge' on these telly favourites

    Channel 5's long running series The Hotel Inspector includes a sideshow. As well as watching its formidable presenter Alex Polizzi trying to rescue some hapless hotel owner from the brink of bankruptcy, car enthusiasts are counting the number of times she is seen driving an Audi A5.

    Shots of the four overlapping rings on the bonnet and steering wheel boss are so prevalent that it's prompted comment on the Pistonheads website, with one viewer calling it 'blatant product placement'.

    Among other contenders in this pastime of badge spotting is another Channel 5 series, Superior Interiors, with presenter Kelly Hoppen driving a BMW X1.

    Though the Pistonheads contributor may be right in sentiment, the appearances of BMW and Audi do not fall within the category of product placement - where suppliers pay for the privilege of publicity - but take the cheaper route of prop supply. 

    "When a car's badge is shown on a TV programme, it's rarely by accident," says Jon Zammett, Audi's public relations chief. "We are always looking for appropriate opportunities to place our models to give them added exposure." 

    "If the context is appropriate, we are happy to loan vehicles," confirms Gavin Ward, BMW's media relations manager. "We would get an idea from the programme script of what is acceptable. We wouldn't push for an opening shot of a BMW - it would be too in-your-face."

    Carmakers, especially those in the premium sector, say they are unlikely to take advantage of product placement following the relaxation of Ofcom regulations in this area.

    "We would not consider a paid-for offer because there is no need," said Ward. "Our cars are desirable, so producers want them to feature in their programmes."

    No takers for Corrie?

    Though Coronation Street now has a Nationwide-branded ATM in the programme's corner shop, word on the street is that approaches to car manufacturers for a product placement deal linked to Steve McDonald's Street Cars taxi firm have so far failed to attract any takers. 

    For lifestyle programmes like Superior Interiors, BMW is only too pleased to see Kelly Hoppen driving one of its X1s on extended loan. And it's win-win for both the manufacturer and the programme's producers.

    As Liza Read, executive director at BRANDirector Entertainment, the agency which secured the deal, explains: "We save the production company a significant amount of money by not having to hire a car for six months or so."

    BMW may not have been so happy to see another of its models, an X5, featured in a recent drama, Top Boy, about drugs gangs on a London housing estate. "The registration plate showed that it was not a new vehicle - it's something we have no control over," says Read.

    Sarah Chapman, Audi's communications manager, pointed out that prop supply is not, in its strictest sense, a free deal. "There's the car's depreciation to take into account during a long-running series like the Hotel Inspector." 

    One agency specialising in prop supply believes Ofcom's relaxation of the rules is unlikely to see a rush towards paid for placement. Sarah Curran, business development director at New Media Group, pointed out that as part of the concession the regulator stimulates that there should be no 'undue' brand prominence.

    "But this only applies to paid-for placement - not to free supply, so the latter is actually a more appealing proposition for suppliers, especially as it extends their presence to the BBC where product placement is still forbidden.

    "Prop supply can be arranged at a third of the cost of product replacement," added Curran. "In the US, which has always had product placement, 80% of the deals are still to do with free prop supply."

    However, Liza Read at BRANDirector says paid-for placement has its attractions. "It's not just about on-screen time, but the spin-offs that companies can use in their marketing campaigns. For example, in the case of Superior Interiors there could be a website video link inviting viewers to test drive an X1."

    Curran believes that there is no conflict between embedding popular brands in TV programmes while maintaining another Ofcom demand for production integrity.

    "Cars and IT equipment like mobile phones and computers are what we call 'hero' props that help push along story lines and illustrate the real world. Fictitious brands - like the lager they serve in EastEnders - jar with the audience."

    It's a view supported by a YouGov poll in July where 46% of respondents said that having real products in TV programmes made for more realism.

    Liza Read describes car props as a short cut to character and plot. "Contrast someone getting out of an Aston Martin and heading for Harrods with a harassed looking mum carrying shopping and getting into a car with child seats." 

    On the BBC beat

    While commercial channels may have an easy ride with car placement, the BBC has to be more wary. What Audi's Jon Zammett describes as 'action cars' are depicted on the Beeb's spy series Spooks, with the appearance of badges ranging from Audi and Mercedes to Lexus and Saab.

    But another brand on the Spooks' car list, Volvo, was recently seen straying from entertainment into the more serious world of current affairs. In an edition of Panorama, Cops Behaving Badly, the Volvo driven by reporter Richard Bilton was clearly identified with two front shots and one wheel badge shot. Incidentally, in another programme, Bilton was holding a MacBook Pro.

    "If we need a vehicle in our programmes, we use standard hire cars, but on the final day of filming Cops Behaving Badly a car hire firm was unable to supply the car we had booked," said a BBC spokesman.

    "For continuity purposes, we needed the same type and colour of vehicle used in the rest of the programme and in order to avoid re-scheduling filming - and incurring extra costs that would involve - we were able to source a vehicle from a local dealership. It was a one-off arrangement made in exceptional circumstances.

    "Regarding the MacBook, we blanked out the fluorescent logos but it is not always practical to completely disguise what brand an object is."

    Sarah Curran summed up the BBC's predicament by commenting: "You can get a viewer complaining about someone holding a can of Guinness on one of its programmes while ignoring the fact that most of its chat shows feature guests plugging their latest DVD, film or book."

    MSN Cars

    *****

    Caution over commission

    Insurance add-ons, ranging from MoT repair cover to paint protection, generate significant income and help customer retention, but one provider has a word of caution over commission.

     Combine the bone-cutting margins on new cars with the continuing erosion of service and repair work to the independents, and it’s little wonder that the franchised sector looks upon F&I as a vital revenue stream.

    But that stream could turn choppy. With commission-driven practices now embedded in retail generally, regulators are taking a renewed interest in products which may not be suitable for the consumer, but generate hefty bonuses for the sellers.

    Though banking is an obvious target, Duncan McClure Fisher, managing director of Warranty Direct, said the regulators’ aim could affect any business involved with financial services. “Some (motor) dealers can make quite chunky profits on insurance, but they have to be careful. The way things are going, you can’t sell products which are viewed to have too big a margin.”

    His cautionary words follow a pledge by Martin Wheatley, head of the newly formed Financial Conduct Authority, to “change the culture of viewing consumers simply as sales targets”. Though not opposed to commission-based selling in principle, Wheatley said:  “We will look at how firms make their money, how they pay their staff and whether they are designing and selling products with customers in mind.

    “This is a change from the traditional regulatory model which involved setting standards and then looking back at what firms have done.”

    Though commission revenue plays a significant part in most insurance offerings, notably extended warranty, among the carmakers’ retail networks, it is arguably of less importance than the product itself when it comes to generating business for the workshops and aiding customer retention.

    As the name implies, most of Warranty Direct’s deals are through car owners, but McClure Fisher points out that 60-70% of the company’s repair claims, totalling around £1m a month, are directed through franchised workshops.

    Warranty Direct is also seeking to extend its ‘direct’ presence in the franchised sector, currently around 7%, with a ‘white label’ version of its extended warranty. “Our proposition is intended to address the challenge of manufacturers not knowing who the third and fourth owners of their product are," said McClure Fisher. "With our marketing and database resources, we are saying ‘let us promote a manufacturer direct warranty to those drivers - we pay you commission and you get repeat business on servicing and repairs’.”

    Extended warranty and GAP generally form the core of dealer insurance offerings from MapFre Abraxas, but it’s been talking to partners about options to expand their portfolio.

    “Products like tyre and alloy cover and MoT insurance are top of the list and they have the added benefit of helping to support customer retention efforts,” said Steve Burgess, head of new business. “If a customer has these additional products and needs to make a claim then their first port of call is the supplying dealer which, as a minimum, is another opportunity for dealers to talk to a customer about other current offers.” 

    But with F&I expected to contribute £2.5m to its bottom line this year, Vauxhall and Chevrolet dealer Drive Motor Retail is selective about these products. As managing director Paul Manning explains: “Offer more than three and we find the customer switches off.” GAP and warranty come high on the list, but Manning said it was difficult to put options such as key insurance or MoT cover in front of the customer.

    However, Manning added that the approach would vary depending on the franchise represented. Dealers selling expensive, prestige brands may have more success with paint and alloy wheel cover than mainstream franchises.

    David Johnson, group finance and insurance manager with Perrys, said: “What you need to put in front of the customer is a sensible portfolio, not an exhaustive list. The sales procedure is protracted enough as it is. The customer can be left feeling fed up with the whole process.”

    Eric Stone, business development director of the WMS Group, reinforces the point that add-ons not only improve profits and cashflow, but also help customer retention.

    "Historically, there have been many commoditised products that could only draw revenue at the point-of-sale, whereas our business has successfully been built on providing not only front-end revenue but also helping with workshop absorption,” said Stone.

    He reported that since the start of 2012 WMS had seen a 13% uplift in the sale of MoT insurance, with businesses recognising that such products can almost guarantee to bring the customer back the following year. “These products carry a range of profit-making opportunities at the point of sale, repair work and again at renewal.

    “Based on the RRP of just £49 for 12 months, customers can rest assured that their vehicle will be covered against MoT failures (including lighting equipment, steering, suspension, brakes, seats and much more) up to a claim limit of £750. MoT insurance goes hand in hand with a comprehensive warranty, and the two products combined will provide upmost peace of mind to buyers – and repeat profitability for dealerships.”

    Stone said that tyre and alloy wheel insurance – introduced by WMS five years ago - was proving to be another appealing offer, building value in the mind of the customer (as well as the sales executive), and available as either stand-alone or combined. “We have recently made several improvements at no additional premium, and cover now includes unlimited tyre repairs/replacements during the three-year duration, and wheel replacement costs up to the individual claim limit if they become damaged beyond repair.

    “For franchised dealers, it is not uncommon to see wheel and tyre penetrations in excess of 20%, with this figure rising to 40% in specialist or luxury franchises. Profit margins are obviously dependent upon the RRP, but with a total customer value of £2,500 and an RRP of just £299 for three years cover, dealers should expect a post-tax margin of circa £150 per sale.

    “Refurbishment of wheels and the replacement/repair work on tyres can be sent back to the supplying dealer to provide additional revenue during the three year cover.”

    Warranty Direct used to offer MoT insurance, but this is now included in its extended warranty. “Leaking shock absorbers, for example, are covered, but not items like chipped registration plates or bulb replacement,” said McClure Fisher. He added that sales penetration of products like GAP and paint protection tended to be better than lower margin options such as extended warranty.

    Nick Jones, group finance manager at Vauxhall dealer Greenhous, said insurance products typically add 10-15% as a percentage of profit to each used car.

    “We are looking at MoT insurance, it’s something Vauxhall is keen to get involved with,” he said. “We offer our Protection Pack with a leaflet explaining the insurance options, including ValueGuard for GAP, along with the Network Q extended warranty.

    “We stopped the smart repairs option because of lack of demand, but drill down on GAP because it’s seen as vital protection for the customer, followed by Diamondbrite (paint protection) and warranty."

    Perrys’ David Johnson said the group separated regulated products like GAP from the non-regulated. Two thirds of the company's outlets had a business manager, with satellites featuring a sales manager, controller and two supervisors. "Offers like MoT cover would not typically be offered at point of sale, but they may be included in the future," he said.

    AM magazine

     

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