E-Marketing Strategy for Reg Vardy

von: Volker Schmid

Table of Contents

Abstract

1 Introduction 1

2 Situation Analysis 2

3 Aims and Objectives 4

4 E-operation Strategy 5

5 E-tactics 7

5.1 Email Tactic 7
5.2 Homepage Tactic 9
5.3 Internet Tactic 12
5.4 Mobile Phone Tactic 13
5.5 Further Digital Tactics 14

6 E-CRM 15

7 Conclusion 18

References 19

Appendix A Analysis of Reg Vardy’s and competitive websites
Appendix B Detailed analysis of selected digital technologies

Abstract

With a total of 81 dealerships and a turnover of 1.3 billion pounds, Reg Vardy is one of the leading motor retail groups in the UK. In order to acquire new customers and maximise customer retention with the help of digital technologies, the company needs to develop an e-marketing strategy.  This paper provides a situation analysis of the present e-marketing situation of Reg Vardy, including the competitive environment based on the strengths, weaknesses, threats and opportunities. Furthermore, the aims and objectives of Reg Vardy’s e-marketing strategy are formulated. Under the e-strategy section, potential digital technologies and the buying process are outlined to develop a ‘five-phase e-operation strategy’. This allows for targeting new and existing customers in all stages of the buying process. Specific e-tactics for customer acquisition and retention are suggested for Reg Vardy. Finally, the paper gives advice on E-CRM issues. It could be shown that Reg Vardy’s main weakness is its current poor usage of digital technologies, the absence of an e-sales channel, the poor exploitation of multimedia functions, and the neglect of customer retention activities. Among other recommendations, it is suggested using digital technologies to develop the market by reaching new segments, and to develop the product by offering new digital-services. General academic advice on E-CRM underlines the more practical recommendations.

1 Introduction

In order to develop an effective E-marketing strategy that will allow Reg Vardy to acquire new customers and maximise customer retention, Chaston (2002) and Strauss et al. (2003) suggest following a formal marketing strategy planning process. The following figure shows an adopted version of the planning process by Chaston (2002) and Strauss et al. (2003), which is applied for Reg Vardy.

Figure 1: The marketing strategy planning process (adopted by Strauss et al. 2003; and Chaston, 2002).

After analysing the present situation of the company, future objectives are identified. With the help of these objectives, an E-marketing strategy is developed, followed by specific tactics. Finally, advice on E-CRM issues needs to be provided.

2 Situation Analysis

The situation analysis presents the first step to the development of an e-marketing plan (Chaston, 2002; Strauss et al., 2003). This section analyses the present situation of the company Reg Vardy by reviewing the existing e-marketing strategy with the help of a SWOT analysis.
Reg Vardy is one of the leading motor retail groups in the UK, with a total of 81 dealerships. The company was founded in 1920. Today, the organisation has a turnover of 1.3 billion pounds, employing approximately 4,700 employees, and selling about 150,000 cars per annum (E-Marketing Assessment Details, 2005).
The company has its own in-house marketing agency called Vardy Marketing. This unit is responsible for an annual advertising and marketing budget of 17 million pounds. Recent Reg Vardy investments in IT for marketing include:

• A customer database for
o New vehicle registrations
o Used car sales
o New car buyer studies
o Customer satisfaction studies
o Customer complaints
o Dealer attitudes

• Major homepage used for
o Building customer relationships on the web
o An online product catalogue
o Product/ price information on a 24/7 basis
o Customising product/ deal i.e. choice of car and finance package
o Offering online incentives and promotions i.e. low deposits and low-rate finance
o Communicating online with customers on a regular basis (email marketing)

In the following, the strengths, weaknesses, opportunities and treads of Reg Vardy’s current E-marketing strategy are highlighted. These have been identified through an analysis of Reg Vardy’s and its competitors’ web site, including Jamjar, Autoscaout24, mg, Volkswagen, Audi and Porsche (see appendix A):

Strengths
• The web page allows customers to receive product and price information. The customer does not need to travel from branch to branch anymore.
• Links on commercial sites such as Lycos and Alliance and Leicester continue to build brand awareness.
• The company uses a customer database to cluster customers into groups, which allows for precise targeting with relevant offers.
• Based on the customers buying cycles identified with the database, the company invites the clients to a special evening at their local dealership where they can save up to 10 percent off new cars (cost-price concept).
• Information collection is via a gold card scheme and customer profiling has recently been carried out by using the internet

Weakness
• The Internet is used as an information tool rather than an alternative sales channel.
• Currently, Reg Vardy does not offer online discounts or process orders online.
• There is poor use of multimedia on the web page of Reg Vardy.
• There is a low level of presentation regarding car pictures (inappropriate background environment, no pictures of the interior car design available).
• No newsletter service is provided.

Opportunities
• The web page enables the sales of cars in areas which Vardy does not target through traditional methods, i.e. radio, newspaper and TV.
• Using digital technologies such as the mobile phone, emails and the internet, the company can acquire new customer and maximise customer retention.
• Interactive online communication with customers could be applied to maximise customer loyalty i.e. personalised communication.
• Cost savings through E-marketing could be achieved.
• CD catalogues or download of the recent cars for the customers could be provided.
• The use of collection and comparison lists on the homepage would facilitate the buying decision of the customer.

Threats
• A major threat to the traditional role of the car dealers is disintermediation. Competitors such as Jamjar offer lower prices by selling cars online. Other indirect competitors such as Autoscout24 use their web page to allow the customer to sell his or her car online. This also presents also an opportunity for Reg Vardy to generate new business.
• The development of groups of customers, who package themselves together in order to negotiate discounts with dealers.

3 Aims and Objectives

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