Volvo's Positioning Woes
We often find ourselves citing specific automotive manufacturers as excellent examples of brand positioning in that they imbue a strong, focused, and differentiating position in everything they do. BMW continues to excel at creating the “Ultimate Driving Machine,” Volkswagen has become the pinnacle of economical transportation and ergonomic design, and Volvo…well Volvo is losing its once vise-like grip on “safety”. It has gotten so bad that some are saying Volvo has an identity crisis, while others are going so far as to say that the marque will have to leave the U.S. market.
The Volvo identity crisis is in part due to shifts in how automotive customers perceive safety. Many of the once innovative features that Volvo pioneered—think of the 3-point safety belt—became industry standards. With the majority of safety features at parity across the industry, Volvo turned to other tactics to continue to compete. What if Volvo had instead elevated the way safety was perceived in the industry? When Volvo was at its peak, it wasn’t just about the number of airbags they offered or the crash test ratings their cars received, but the best overall package of safety available in a car. While other manufacturers could tout a certain level of safety, none of them were designed from the ground up with safety in mind.
Competitive differentiation is necessary for any positioning to succeed. And while Volvo differentiated themselves on safety successfully for years, they failed to continue to elevate their perception as the market shifted around them. Today, Volvo still delivers on safety in terms of features, but doesn’t focus on the “total safety package” that they once did.