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The Age of Persuasion meets the Era of Influence

Establishing Our Brand in the Emerging Marketplace

Lubrico Annual Sales Meeting


December 2015
Presented by:
Henry Hammond
Marketing & Techology Manager
Lubrico Warranty
x251
henry@lubrico.com

The Age of Persuasion (Historical Model)


This is the historical marketing model: the process was to expose a captive audience to
consumer messages en masse with volume and repetition via broadcast media.
The Era of Influence (Emerging Model)
Uses technology to collect information about consumers to allow advertisers to be
present when and where consumers are looking for something: to engage them,
demonstrate value, and participate in multiple conversations across the digital media
spectrum.
Terry OReilly
As the marketing world shifts from a century of overt one-way messaging
to a new-world order of two-way dialogue, we leave the age of
persuasion and enter the era of influence. The first 50 years of modern
advertising was based on hard-sell. The next 50 years was persuasion
through creativity and media tonnage. But as advertising squeezed into
the 21 century, it was forced to shed its elbowing ways and become a
delicate dialogue. The goal is no longer to triumph by weight, but to win
by influence.
Under The Influence: www.cbc.ca/radio/undertheinfluence/about

Henry Hammond Marketing & Technology Hack


https://www.linkedin.com/in/henryhammond
Highlights (25+ Years)
IT Consultant (Ottawa CSIS, DoD, Fed Gov)
Tech Product Manager (Montreal, Boston, Silicon Valley)
Keynote Speaker Hi Tech Conference circuit
Technology Writer for industry journals and newspapers
General Manager IBM Dealer (Caribbean)
Regional Manager for Yellow Media Ltd (SWO)
College Instructor MKG & IT (Fanshawe College)
Industries:

High Tech, Telecom, Government, Off-Shore, Financial, Military, Academic, Consulting

Certificates:

Enhanced Level Security Clearance Federal Government of Canada


Member American Marketing Association (AMA)
University of West Indies Executive Leadership
Microsoft Certified Product Specialist (MCP)
Computing Technology Industry Association (A+)
Cisco Certified Network Administrator (CCNA)
Novel Netware Administrator (CNA)

Henrys Mission Statement:


Be an advocate for customer experience and seek excellence in the
development of Lubricos brand and products. (Marketing)
Use information and technology to execute Lubricos business strategy and
to engage with its customers and stakeholders. (Technology)

Henrys Mantra:
Tell Lubrico's Story.
Innovate with Technology.
Support the Team.

Marketing

Definition of Marketing (Wikipedia)


Marketing is communicating the value of a product, service or brand to customers, for the
purpose of promoting or selling that product, service, or brand. The main objective is to
increase sales of the product and profits for the company. Marketing acts as a support system
to the sales team by propagating messages and information to the target audience.
Marketing techniques include choosing target markets through market analysis and market
segmentation, as well as understanding consumer behavior and advertising a product's value
to the customer.
From a societal point of view, marketing is the link between a society's material requirements
and its economic patterns of response.
Marketing satisfies these desires through exchange processes and relationship building.
Marketing blends art and applied science (such as behavioural sciences) and makes use of
information technology.
Marketing is applied in organizations through marketing management.

The Role of Marketing in an Organization


Marketing is the business of researching, developing, branding, promoting, advertising, and
selling products or services to a marketplace
Outside
MKG is first and foremost CUSTOMER CENTRIC. The customer is the audience. MKG must
always be aligned with customer needs and be connected to the customer vantage point. The
goal is Customer Satisfaction. MKG offers a product that the marketplace wants and will pay
for. It makes a value proposition which speaks to the needs and desires of the CUSTOMER.
Inside
Within the organization MKG interacts with key stakeholders (Sales, Service) to understand the
business operations and customer touch-points in order to ensure that all external messaging
is relevant and informative.
MKG serves Sales. The primary objective of Sales is to achieve sales targets. MKG is
responsible for providing Sales with quality product collateral and qualified sales leads to help
Sales achieve this goal. MKG listens to Sales to learn about the customer and the marketplace
so as to better support their efforts in the field.

Marketing is a Feedback Loop


Starting with Product Development Marketing engages in an internal/external dialogue to
ensure the companys products evolve to not just meet but exceed and delight the customer.
Marketing takes what it learns and seeks to educate and influence the marketplace by
participating in the consumer conversation, utilizing all of the ever-changing (bi-directional)
channels, technologies, and media available to its customers.
Marketing then actively serves and supports the direct sales efforts of the Sales Department.
B2C Life Cycle: Customer Experience Loop

Traditional Outbound Marketing vs. Inbound Digital Marketing

Interrupt &
Persuade

Attract &
Influence

Screen-time marketing is predominantly


inbound (desktop, tablet, mobile)

Personal & opt-in emails we choose to read


Web content we choose to consume
Blogs, Wikis, Forums, Reviews, Reports
Search results we want to click on
Social media we follow and share
Videos we choose to watch

Traditional channels that interrupt


people in order to get their attention:

TV Commercials
Newspaper/Magazine Print ads
Broadcast Radio spots
Billboards

Most Common Digital Marketing Channels

Screens

Screens

Screens

Screens

Marketing & Lubrico

Lubrico Warranty:
Expanding Traditional Marketing Channels

Historical:

Emerging:

Reseller (Dealer) Targeting


Website
Dealer Portal
Offline Manual Surveys
Self-published Testimonials
Printed Product Collateral
Outbound Telesales Support
Distributed Network of Sales Reps
Trade Magazines
Print Publications
Reseller Promotions
Dealer Sales Incentives
Product Videos
YouTube Channel

Dealer + Consumer Engagement


Updated Website with Blog
Enhanced Dealer Portal
Search Engine Optimization (SEO)
Search Engine Marketing (SEM)
Google+, Facebook, Twitter, LinkedIn
Consumer Forums & Review Sites
Opt-in Email Marketing
Dealer Website Landing Pages
Dealer e-Newsletters
Online Customer Surveys
Digital Display (Kijiji/Trader/Wheels)
Optimize YouTube

We have TWO main customer segments:


B2B (Dealers) & B2C (Warranty Holders)

Besides containing both outbound and inbound channels and initiatives, our marketing strategy
must consider these two distinct audiences. Certain campaigns and communications will overlap,
most will be segmented between channels and positioned to target dealers and consumers with
separate messaging. To be continued!...

1. Dealers

2. Consumers

Phased Approach to Design Refresh...

Website is next

Need to Be Where the Customer is Looking


Google
Search

Exact Keyword Searches Monthly (CANADA):


Lubrico2,400
Lubrico warranty.1,000
Lubrico warranty reviews..210
TOTAL:..3,610 (120/Day)
[BRAND] warranty..2,450
[BRAND] Extended warranty.....980
Powertrain warranty....390
Used car warranty....110
TOTAL:.3,930 (132/Day)

Google
Alerts
Who is talking about Lubrico right now?

www.lubrico.com

500 Sessions
Daily Average

Facebook Business

YouTube Channel

Twitter Business

Just the Beginning!...


Google+

LinkedIn Business
Forums, Reviews, Reports

RedFlag, Ripoff, Yelp

Google Maps

Lubrico Social Media Dashboard


https://hootsuite.com/dashboard#/

Global did not create/claim their Yelp Business Profile.


Contains nothing but scathing, negative reviews with
no responses. Average Rating: 1-Star

Luckily Lubrico has yet to collect any bad reviews on


Yelp, but a profile did exist. I claimed and optimized it
with current, descriptive business information and
images. The instant a review is created I will be
notified and can craft a response. Further, we can
encourage happy clients to post positive reviews there
and build up our image

EXAMPLE:
YelpEither join the conversation and
influence the marketplace or dont: Theyll
talk about you anyway (and its rarely pretty!)

Influencing the Consumer Early on in the Buying


Cycle in the Online Showroom

227 of 164,502 Used Car (Dealer) Listings


mention Lubrico (0.001%)

386,219 Used Cars (Canada)

Two Ways to have a


presence in this vast
showroom:
(1) Dealer Listings
(2) Display Ads

74, 828 Used Cars


Reports, Reviews, News, Videos

1,399 Dealers. 750,000 Visits

Social Media is dominating the Customer Service Arena


1

3
2
4

The marketplace no longer trusts self-published testimonials

Using digital customer service tools like web surveys, email broadcasting,
and a marketing automation database, Lubrico can evolve from static
surveys, self-published testimonials, and manual reports to electronic
surveys that allow for positive reviews to be published in real-time on our
social media properties.

Lubrico Dealer Database


Total: 12,000 (Used: 7k. New: 5k)

https://www.google.com/maps/d/edit?mid=z9tKqXYQHSfM.kH4FDOkk5BCU

Future Stuff
(Future = Now)
A person often meets his destiny on the road he took to avoid it
Vroom (http://goo.gl/jyX90Y)
Cox Automotive/Dealertrack (https://goo.gl/lwm7Iz)
OpenRoad/Carproof (http://goo.gl/uZf0wn)
Aviva/Umbrella (http://www.umbrellawarranty.ca/)
Assurant/CTC (http://www.assurantsolutions.com/individual/vehicleprotection/b2c-vsc-t3.html)
Key players in our industry are in a race towards a common goal, and big dollars are involved via mergers, acquisitions,
partnerships and investments from outside traditional automotive circles (Silicon Valley, venture capital).
Traditional barriers are being eroded as consumers demand a new and improved used car shopping experience, one that
aligns with what theyve become accustomed to.
Progressive industry players are leading the push, putting old prejudices behind them, and embracing new business
models and technologies that serve the best interests of their customers, recognizing that momentum has been building
towards a tipping point for years and their future depends on riding that wave in to the new automotive economy

Market Data Info Pack

Canadian Motor Vehicle Market 2014-2015


1.

Total Motor Vehicle Market in Canada 2014: >$120 billion

2.

Motor Vehicle Market = Single largest retail sector at 23% (No.2 = F&B at 22%)

3.

Total Units Sold: 1.8m (Commercial 60%. Passenger 40%)

4.

2014 Sales: Largest increase since 2010 (8%)

5.

2014 Sales: Increased in 11 of 12 months setting record monthly car sales

6.

2015 Sales Factors: Lower $CAD, loose credit conditions, lower gas price = Record Profits

7.

2015 Profits: Up from $1.3b in 2014 to $2.3b in 2015 (or 2.1% of sales)

8.

Motor Vehicle Sales growth expected to continue to 2017 at least and perhaps beyond

9.

Resurgent popularity of Light Truck/SUV, representing 60% of vehicle sales in Canada

10. Industry costs expected to rise by 3.9% due to increased materials costs
11. Ideal Used:New unit sales ratio = 1:1. Current rate is approximately 0.8:1
12. New car franchise dealers looking at increasing used car sales (In 2013 Used = 43%)
13. Average retail gross profit (2013) per unit: Used=$2,361. New=$1,200. Current?
14. Autotrader: 381k Inventory Snapshot 149k New. 210k Used. 29k CPO. 349k via Dealer. 31k via Private)
15. Kijiji Canada Inventory Snapshot 386k Used Cars. Predominantly C-to-C (33% of total market)

Finaccord Market Report


Executive Summary
Consumer Automotive Financial Services in Canada 2015

F&I Stack:

Extended Warranties (39%), Motor Insurance (27%), Creditor Insurance (15%),


Financing, Prepaid Service Contracts (5%), GAP Insuance (4%), Tire & Rim, Wear
& Tear, Scratch & Dent, Road Assistance

Total F&I:

$2.51B

Ext Warranty:

$989m ($467m New; $522m Used (39% of total F&I single largest).

Up 5%

from 2014). Take-up Rate at POS is 39.1% (New & Used Car Dealers)

Used Cars:

3m units sold (1.3m separate loan/cash; 1.7m financed.


2m B2C (dealers), 1m C2C (for sale by owner).

Up 6% from 2014)

Light Vehicle Sales by Manufacturer


(YE 2014 & Projected 2015)
Fiat-Chrysler
Ford
GM
Toyota
Brand

Honda

2014

Fiat-Chrysler
Ford
GM
Toyota
Honda
Hyundai
Nissan
Mazda
Kia
Volkswagen
Suburu
Mercedes-Benz
BMW
Audi
Mitsubishi
Accura
Lexus
Infiniti
Land Rover
Porsche
Mini
Volvo
Smart
Jaguar

Hyundai
Nissan
Mazda
Kia
Volkswagen
Suburu
Mercedes-Benz
BMW
Audi
Mitsubishi
Accura
Lexus
Infiniti
Land Rover
Porsche

Total:

Mini

2015 Growth

297,575
293,113
243,074
185,464
149,289
143,801
105,101
73,857
73,711
65,313
40,774
36,197
31,079
22,490
21,633
17,959
16,796
10,001
6,338
4,917
4,673
4,670
2,042
1,532

301,146
274,940
255,714
189,359
149,140
139,487
118,554
71,494
70,689
74,327
46,891
43,183
34,124
26,584
20,400
20,185
20,727
10,411
6,763
6,456
6,416
4,703
762
1,371

1.2%
-6.2%
5.2%
2.1%
-0.1%
-3.0%
12.8%
-3.2%
-4.1%
13.8%
15.0%
19.3%
9.8%
18.2%
-5.7%
12.4%
23.4%
4.1%
6.7%
31.3%
37.3%
0.7%
-62.7%
-10.5%

1,851,400

1,893,823

2.3%

Volvo
Smart
Jaguar
0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

New Passenger Vehicle Sales Canada 2014


(Total Units = 760, 449)
SA, 12,293, 2%
N&L, 13,308, 2%

PEI, 3,820, 1%

MA, 17,527, 2%
NB, 18,572, 2%
NS, 26,480, 3%

ON
QC

AL, 59,892, 8%

BC
ON, 302,077, 40%

AL
NS

BC, 77,329, 10%

NB
MA
N&L
SA
PEI
QC, 229,151, 30%

Autotrader Inventory:
New & Used Vehicles by Province
160,000
140,000
120,000
100,000
80,000
60,000
40,000
20,000
0
ON

QC

AB

BC

SK

MB

NS

NB

PEI

NL

Kijiji Inventory:
Used Vehicles by Province
160,000
140,000
120,000
100,000
80,000
60,000
40,000
20,000
0
ON

QC

AB

BC

SK

MB

NS

NB

PEI

NL

Autotrader: Used Dealers by Province


3000
2500
2000
1500
1000
500
0
ON

QC

AB

BC

SK

MB

NS

NB

PEI

NL

Warranty Comparison Highlights


Manufacturer Warranties
1.

Time/Distance Basic Coverage Range: Min = 3yr/60,000km. Max = 5yr/100,000km

2.

New Car Dealers typically mark up their manufacturer's warranty by 25%-30%

Extended Warranties
1.

Average List Price = $1,214. 45% of Ext Warranty buyers make a claim.

2.

65-75% of claims are made on BMW, Chrysler, Dodge, Mercedes (Avg claim = $2,000)

3.

Dealer mark-up ~ 100%

Aftermarket Warranties
1.

Warranty dollars:

Repairs: 30-60%; Dealer Commission: 25-50%; Warranty Company: 10-20% Both new and used
car dealers mark up third party warranties 50-100%

2.

Competitive Review 3rd Party Aftermarket Warranty Providers (Lubricos Top 5x Competitors):
I.
Global Warranty
II. Peoples Choice
III. Coast to Coast
Pending
IV. NationWide
V. First Canadian
VI. Industrial Alliance
VII. Simtech

2015
Manufacturer
Acura
Audi
BMW
Buick
Cadillac
Chevrolet
Chrysler
Dodge
Ford
GMC
Honda
Hyundai
Infiniti
Isuzu
Jaguar
Jeep
Kia
Lexus
Lincoln
Mazda
Mercedes-Benz
Mercury
Mini
Mitsubishi
Nissan
Pontiac
Porsche
Saab
Saturn
Scion
Smart
Subaru
Suzuki
Toyota
VW
Volvo

Basic Warranty
4 years/80,000 KM
4 years/80,000 KM
4 years/80,000 KM
4 years/80,000 KM
4 years/80,000 KM
3 years/60,000 KM
3 years/60,000 KM
3 years/60,000 KM
3 years/60,000 KM
3 years/60,000 KM
3 years/60,000 KM
5 years/100,000 KM
4 years/100,000 KM
3 years/80,000 KM
4 years/80,000 KM
3 years/60,000 KM
5 years/100,000 KM
4 years/80,000 KM
4 years/80,000 KM
3 years/60,000 KM
4 years/80,000 KM
3 years/60,000 KM
4 years/80,000 KM
5 years/100,000 KM
3 years/60,000 KM
3 years/60,000 KM
4 years/80,000 KM
4 years/80,000 KM
3 years/60,000 KM
3 years/60,000 KM
2 years/40,000 KM
3 years/60,000 KM
3 years/60,000 KM
3 years/60,000 KM
4 years/80,000 KM
4 years/80,000 KM

Powertrain Warranty
6 years/100,000 KM
4 years/80,000 KM
4 years/160,000 KM
5 years/160,000 KM
5 years/160,000 KM
5 years/160,000 KM
Lifetime Limited
Lifetime Limited
5 years/100,000 KM
5 years/160,000 KM
5 years/100,000 KM
10 years/160,000 KM*
6 years/110,000 KM
7 years/120,000 KM
4 years/80,000 KM
Lifetime Limited
10 years/160,000 KM*
6 years/110,000 KM
6 years/110,000 KM
5 years/100,000 KM
4 years/80,000 KM
5 years/100,000 KM
4 years/80,000 KM
10 years/160,000 KM
5 years/100,000 KM
5 years/160,000 KM
4 years/100,000 KM
5 years/160,000 KM
5 years/160,000 KM
5 years/100,000 KM
2 years/40,000 KM
5 years/100,000 KM
7 years/160,000 KM
5 years/100,000 KM
5 years/100,000 KM
4 years/80,000 KM

Manufacturer Warranty
Comparison
(2015 v 2011)

Manufacturer
Acura
Aston Martin
Audi
Bentley
BMW
Buick
Cadillac
Chevrolet
Chrysler
Dodge
Ferrari
Ford
GMC
Honda
Hummer
Hyundai
Infiniti
Jaguar
Jeep
Kia
Lamborghini
Land Rover
Lexus
Lincoln
Lotus
Maserati
Maybach
Mazda
Mercedes-Benz
Mercury
Mini
Mitsubishi
Nissan
Pontiac
Porsche
Rolls-Royce
Scion
Subaru
Suzuki
Toyota
Volkswagen
Volvo

Basic
Warranty
4/50,000
3/100,000
4/50,000
3/Unlimited
4/50,000
4/50,000
4/50,000
3/36,000
3/36,000
3/36,000
2/Unlimited
3/36,000
3/36,000
3/36,000
4/50,000
5/60,000
4/60,000
4/50,000
3/36,000
5/60,000
3/Unlimited
4/50,000
4/50,000
4/50,000
3/36,000
4/50,000
4/50,000
3/36,000
4/50,000
3/36,000
4/50,000
5/60,000
3/36,000
3/36,000
4/50,000
4/Unlimited
3/36,000
3/36,000
3/36,000
3/36,000
3/36,000
4/50,000

Powertrain
Warranty
6/70,000
3/100,000
4/50,000
3/Unlimited
4/50,000
5/100,000
1
5/100,000
1, 11
5/100,000
2
5/100,000
2, 9
5/100,000
2/Unlimited
3
5/60,000
1, 11
5/100,000
4
5/60,000
5/100,000
10/100,000
6/70,000
4/50,000
2, 13
5/100,000
10/100,000
3/Unlimited
4/50,000
8
6/70,000
6/70,000
3/36,000
4/50,000
4/50,000
6
5/60,000
4/50,000
5
5/60,000
4/50,000
10/100,000
12
5/60,000
5/100,000
4/50,000
4/Unlimited
5/60,000
5/60,000
7/100,000
7
5/60,000
5/60,000
4/50,000

Corrosion
Warranty
5/Unlimited
10/100,000
12/Unlimited
3/Unlimited
12/Unlimited
6/100,000
6/100,000
6/100,000
5/100,000
5/100,000
2/Unlimited
5/Unlimited
6/100,000
5/Unlimited
6/100,000
7/Unlimited
7/Unlimited
6/Unlimited
5/100,000
5/100,000
3/Unlimited
6/Unlimited
6/Unlimited
5/Unlimited
8/Unlimited
Not offered
4/50,000
5/Unlimited
4/50,000
5/Unlimited
12/Unlimited
7/100,000
5/Unlimited
6/100,000
12/Unlimited
4/Unlimited
5/Unlimited
5/Unlimited
5/Unlimited
5/Unlimited
12/Unlimited
12/Unlimited

Roadside
Assistance
4/50,000
2/100,000
4/Unlimited
3/Unlimited
4/Unlimited
5/100,000
5/100,000
5/100,000
3/36,000
3/36,000
Not offered
5/60,000
5/100,000
Not offered
5/100,000
5/Unlimited
4/Unlimited
4/50,000
3/36,000
5/60,000
2/24,000
4/50,000
4/Unlimited
6/70,000
Not offered
4/50,000
Unlimited
3/36,000
Unlimited
5/60,000
4/50,000
5/Unlimited
3/36,000
5/100,000
4/50,000
4/Unlimited
2/25,000
3/36,000
3/36,000
10
2/25,000
3/36,000
4/Unlimited

2011

Extended Car Warranty Comparison


Consumer Affairs USA:
http://www.consumeraffairs.com/auto_warranty/
Top 10 Reviews USA:
http://extended-car-warranty-services-review.toptenreviews.com/
ThoroughlyReviewed.com:
http://thoroughlyreviewed.com/car-warranty/extended-car-warranty-company-reviews/
Consumer Reports (Canada)*:
http://www.consumerreports.org/cro/magazine/2014/04/extended-warranties-for-carsare-an-expensive-game/index.htm
Capgemini Report: Anatomy & Physiology of the Used Car Industry:
https://goo.gl/GVDknu
PA Canadian Aftermarket Warranty Industry Report (2004): https://goo.gl/Zi1SGy
Federal Trade Commission (USA) Advisory: http://goo.gl/qP7lbr

*This article represents the perception of the average informed car buyer.

New Warranty Coverage Comparison


72

Powertrain

Basic

60
Accura Audi BMW

36

Hyundai/ Kia/ Mitsubishi

Months

48

Ford
Chrysler
GMC
Toyota
Nissan
Honda
Mazda

24
18
12
6
0

20

40

60

80

100

120

Kilometers

140

160 180

200

Warranty Coverage Chart (Ford 2015)

Ford (New)
-Powertrain
-Base
-Extra
-Premium

Ford (Extended CPO)

Most Popular Used Car Warranty Review Sites


(Media, Forums, Reviews)

1. www.consumerreports.org
2. www.apa.ca
3. www.consumeraffairs.com
4. www.popularmechanics.com
5. www.theglobeandmail.com
6. www.edmunds.com
7. www.usedcartips.org
8. www.about.com
9. www.redflagdeals.com
10. www.ripoffreport.com
11. www.yelp.ca
12. www.thoroughlyreviewed.com
13. www.caranddriver.com

Housekeeping & Discussion

Twitter Sign-up
E-mail Signature
Usage of Social Media by Reps
Negative Reviews
CASL
New Branding Design Concepts
Website
2016 Advertising Schedule

Video

Perceived Value
Advertising adds value to a product by changing our perception, rather than the
product itself. Rory Sutherland makes the daring assertion that a change in
perceived value can be just as satisfying as what we consider real value -- and his
conclusion has interesting consequences for how we look at life

Rory Sutherland: Life Lessons from an Ad Man

https://www.youtube.com/watch?v=audakxABYUc&list=PL8fnPYqHBQVKErJ_BfJaw_0Qqnk4YHSsY

Video Runtime = 15min

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