CMO is OUT: What’s next for this iconic car company?
Steve’s breakdown: There’s quite a story going on over at Jaguar and it may be a good time to introduce the agency. Read on . . .
WHITLEY, UK: Jaguar Land Rover is on the hunt for a new marketing boss after Fiona Pargeter announced she was leaving the role less than two years after being appointed amid a major consolidation of multiple disciplines to future proof the business. Now, whoever fills the driver’s seat will have to guide its classic British brands as they come to terms with an electric-fuelled existence.
With experience from Ford, Volvo and Nissan, Pargeter joined JLR in 2009 to become head of global PR comms in 2012. But big changes came in 2018 when commercial chief Felix Brautigam consolidated the car marque’s customer experience, product marketing, market performance, and planning departments, elevating the PR vet to lead as a ‘customer experience director’.
A former colleague, who has since left the business and wished to remain anonymous, described her as a “fantastic boss” and a major loss to the team.
“She was rooted in the sensibilities of traditional PR, but was also well ahead of the curve when it came to brands self-publishing and the importance of content,” they said.
What’s the health of the business a new CMO will join?
At the time of the restructure, Brautigam said plan was to make the business “fit for future… to meet the changing needs of its global customers” It was a move made out of necessity, not choice, amid what had been a tough few years for JLR. And market conditions have continued to prove challenging.
In the final three months of 2018, it posted a colossal £3.4bn pre-tax loss, leading to cuts of 4,500 staff (10%) as it hunted £2.5bn in savings in an initiative named ‘Project Charge and Accelerate’. While a shock to many, it reflected pressures felt across the auto industry. Around the same time, Ford made 7,000 cuts while its marketing department was also “redesigned”.
JLR’s profit had dried up in the space of a year. It blamed the US trade war with key market China and Brexit uncertainty as it suffered a 4.6% drop in vehicle sales in 2018 (592,708 models).
But it is beginning to see light at the end of the tunnel. Recently reflecting, Ralf Speth, chief executive of JLR, told Autocar that the whole industry was affected but his company is getting “back on track.”
He said: “Our advantage is we’re agile. We are on track to over-deliver on the short-term part of our programme.”
Revenue was up 8% year on year to £156m pre-tax profit in the three months leading to 30 September 2019. While overall sales dropped again that year by 5.9% there is hope new models like the Range Rover Evoque, Jaguar E-Pace, Jaguar I-Pace and the Range Rover Sport will start accelerating out of showrooms.
Trade wars aside, the business environment is also being shaped by concern for the environment as the public’s awareness of global warming and sustainability increase. Many are finding it difficult to justify the purchase of gas-guzzling SUVs and luxury sports cars as more eco-friendly options emerge.
But JLR is acting on this.
It recently invested “hundreds of millions of pounds” into its Castle Bromwich plant in Birmingham to focus on electric vehicles – a seismic shift. BBC News reported that 90% of its vehicle run on diesel but the fuel is being increasingly taxed and regulated while demand drops in favour of EV and hybrid alternatives.
Has the marketing restructure helped the brand?
The former JLR marketer said the restructure of the marketing department in 2017 was the “correct move”, and combining the PR and marketing comms functions has undoubtedly put the business in a stronger position.
“Everyone is producing content now. The restructure theoretically allows a single message to be shouted from every outpost globally,” they said. “We’ll see more car brands doing exactly that.”
With the overhaul came a new focus for its marketing investments. JLR took on a more product-led approach, speaking to different audiences for each models. You’d have your green consumers, urban fashionistas, C-suite coupe drivers, and SUV adventure types all seeing different aspects of the brands, a new tactic from the overarching brand story-telling it once revelled in.
Hollywood actress Eva Green was hired to front the advertising push for its electric variants. ’It’s just electricity, nothing to be afraid of,’ she says as a thunderstorm rattles through London in an attempt to address scepticism around the fuel. In 2019, the I-Pace comprised 10% of Jaguar sales, but now is the time for it to deliver successive models as other automakers play catch up.
Getting to this point was not without its challenges for the newly formed team. Few in the company backed the electric side project in its early days, the former employee claimed, but that has changed following VW’s DieselGate changed global perceptions towards the fuel.
But amid these changes, it could be argued that JLR’s marketing lost some of the spark from its past and Jaguar could learn a lot by looking back at its highly successful ‘British Villains’ work from 2014 (see below)
“It really put a swagger back into the brand. We got the best results out of it but moved away from the strategy, the board didn’t want to position us as ‘bad’,” they added.
Spark44 delivered the villains and the Eva Green work, offering some creative continuity over the years. However, Pargeter’s successor, will need to ensure Jaguar has a “strong brand and message” despite the focus on zero-emissions vehicles.
“It means a lot to a lot of people and as we go forward with electric you can still deliver that,” the ex-staffer said.
So how much work needs to be done? JLR brands punch above their weight, but WPP’s Brandz 2019 list didn’t place either in its top 10 auto companies.
Electric disruptor Tesla shot into seventh behind Nissan, Ford, Honda, BMW, Mercedes-Benz and Toyota for brand valuations.
Predicting the future of the space, Chris Hunton, global team leader of WPP, said: “The cities will regulate in favor of electric. But for people living in Nebraska, combustion engines will still have a role to play.” In light of this, there is no single solution to the fuel problem, a mix of products will have to be offered. Additionally, he said cars are becoming increasingly tech-enabled and are shifting towards “experiences” – hence JLR’s top title, customer experience director.
Another employee, who left before the restructure, branded Jaguar and Land Rover as challenger brands with lasting heritages to draw from.
“There were some ingrained negative perceptions to overcome and there was also a feeling at the time that we had to use the relevance of our engineering and design, rather than lean on legacy too much.”
But the legacy did help, they were particularly appealing in the APAC region, trading on the ‘Cool Britannia’ theme. She said the launch of the “show-stopping, game-changing” I-Pace, changed the perception of the electric category and the Jaguar brand post-restructure.
“As brand equity is concerned, it’s safe to assume that they’re doing OK, but it is becoming harder for them to remain the challenger brand.”
Pargeter’s replacement will have to face a unique brand challenge in navigating an unorthodox marketing model, balancing product-marketing with brand storytelling and finding the common ground between countryside SUV owners and urban electric-coupe drivers.