Strong brands are important assets

Full market coverage with future positioning.

Brand positioning project aims to unlock hidden potential

Increasing market coverage, sharing and better utilizing resources, and increasing market share – these are the aims of the new Brand Positioning Project, which is a key part of the Volvo Group’s growth strategy.

– The brands are at the centre of the Group Trucks organization. By aligning the brands, we are going to increase our market coverage and be able to sell trucks to a broader customer base, says Olof Persson, President and CEO of the Volvo Group. Furthermore, we will be able to better utilize the strategic assets we have built over time - our customer relations, scale, industrial footprint, distribution networks and supply chains. In some countries, we may even be able to add additional brands from our portfolio to an existing network base, which will grow and strengthen the business of our dealers.

Since taking the strategic decision to focus on commercial vehicles, the Volvo Group has built a strong portfolio of truck brands, including Renault Trucks, Mack, UD Trucks, and of course Volvo, as well as a joint venture with Eicher Motors in India. Over the past decade, the Group has also invested heavily in developing technology platforms, customer relations, a global industrial footprint and global distribution networks.

Until recently each truck brand has been operating relatively independently and often in the same segments. By aligning brands so they focus on different segments, while also sharing resources and networks, the Volvo Group can better leverage its assets in the brand portfolio.

– The brand positioning project is extremely important because we’re taking the Volvo Group into a completely new phase, says Peter Karlsten.

– We are going from a brand-by-brand strategy, to having a full brand portfolio and taking a completely different approach to the markets.

Joint view on markets
The first step in the brand positioning project was to define market segments, so that the entire group views the market in the same manner. Group Trucks has agreed on four key segments of the truck industry: basic, value, high-end and premium.

– By combining the brands and networks we open new opportunities, stresses Peter Karlsten.

– For example, currently most of our brands are in the high-end or premium segments, while there is an empty spot in the value segment – this represents a great opportunity.

Under the new plan Volvo and Mack will continue to service the high-end and premium segments. Outside of Japan, UD Trucks will focus on the value segment, while UD Trucks in Japan remains in the high-end segment. Renault Trucks will concentrate on the high-end segment and will stretch into the value segment. Eicher, which currently services the basic segment, will also stretch into the value segment.

With each truck brand being assigned a specific segment and customer base, Group Trucks can increase its market share, and contribute to the overall growth of the Volvo Group. The brand positioning project has also provided valuable input when the Group Trucks organization was designing road maps to reach their strategic objectives.

– We now have a very clear view on where we are going and how we can do things in a more efficient way, says Olof Persson. This is a new approach and it will open up fantastic opportunities.