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Suzuki is a small brand looking for a big year

Dale Wyatt, Suzuki

Suzuki GB aims to smash its ‘personal best’ this year, but rather than pushing its dealers on the numbers alone, it wants to win their hearts and minds.

Dale Wyatt, Suzuki GB sales and marketing director, is clear that he rates qualitative success above quantitative: “Quantitative is a by-product of doing a qualitative thing. We’re not over-interested in vanity business, we’re interested in building a brand and a business for the future.”

He is proud that the carmaker has held a position in the top three of the National Franchised Dealers Association (NFDA) Dealer Attitude Survey for the past four years, and last year Suzuki was awarded the NFDA’s Manufacturer of the Year trophy.

Wyatt returns the praise to his network, repeatedly describing the manufacturer’s dealer partners as “capable”, “reliable”, “great retailers” and “strong”.

Suzuki hit its registrations high point of 37,395 units in 2014, which fell almost 8% to 34,437 last year.

According to May’s SMMT figures, it is 13.6% ahead so far this year. Its year-to-date market share is 1.3% (market share for 2015 was 1.5%).

“Market share is only an indicator, it’s not the be all and end all,” said Wyatt.

Although it is already aiming to beat its personal best this year, Suzuki’s dealer network  has also been given a ‘stretch target’ of 40,000 registrations by the end of the year, described by Wyatt as “a BHAG (big hairy audacious goal)”. Further out, he sees 45,000 annual sales as a possibility.

Following two months of stalling private registrations, that target may seem like a challenge for Suzuki, which relies on retail customers for 85% of its business. However, for the first four months of this year its retail registrations were 20.8% ahead of the same period a year earlier.

 

“When you become a Suzuki dealer, you join the Suzuki family, and it’s a family where you belong and feel valued” Dale Wyatt, Suzuki

Network profitability, at 1.6% RoS, is above average (1.24%, according to ASE), said Wyatt, and will strengthen further. The average solus Suzuki dealer made 2% in 2015. Wyatt has set a target of increasing the national average to 2% this year, and 3% for solus sites.

Wyatt described its priorities as trying to maintain success and keep it small and simple.

“One of the great bits about this job is that I’m allowed to get on and do it. There are a lot of people who do similar jobs to mine around the land and need six pieces of paper signed off by everybody and talk to three different markets in order to do something.

“We’re in a unique position – certainly if we get it wrong I’d get lots of visitors, but as long as we do what we said we’re going to do, we’re relatively left alone.

“It strikes me that as businesses grow, they get better at strategy, marketing, finance and technology, and often progressively weaker at politics, communication and turnover – you lose that communication.”

Suzuki’s focus has been on minimising politics and confusion, keeping the morale right and tackling staff turnover. Wyatt said while the management team recognises the need to excel at the basics, it consistently examines whether or not its developments and programmes are core to the brand or “fluff”.

“As businesses grow, you get lots of intellectually compelling ideas, well thought-out and which stack up on the business plan. But everything we want to execute has to come through the dealer network, so just because it’s a good idea and stacks up on a spreadsheet, it doesn’t mean now is the right time to do it, or that it’s the right thing to do.”

 

The six Suzuki questions

Suzuki GB’s management board considered six questions: why we exist, how do we behave, what do we do, how do we succeed, what’s most important right now and who must do what.

Suzuki Baleno





SUZUKI BALENO
A spacious, more practical alternative to the Swift. It demonstrates some of Suzuki’s latest technology, such as the 1.0-litre Boosterjet 105g/km CO2 turbocharged petrol engine and a mild-hybrid engine with a lithium-ion battery that helps it keep CO2 below 95g/km.4.

Answering those questions has resulted in clearly defined roles and responsibilities for the management team and guided how Suzuki conducts its business.

“We came up with a vision: When you become a Suzuki dealer, you join the Suzuki family, and it’s a family where you belong and feel valued. The relationship is one where, internally, the family can openly criticise each other, but if someone externally tries to pick on one of us, we all defend each other.

“Often, with owner-driver businesses, you can get a bit irritated and jaundiced by the industry, but we want to get to the point where our dealers may complain, but they know they’re in the right place, where they know there’s no better place they’d rather be. We want to make sure they feel valued.”

Suzuki has a cultural contract – a document in addition to its dealer agreements – so if there is a fallout, or a disconnect, it can be referred to. It leads to questions such as whether the parties are following the brand values of “keeping it simple, speedy and Suzuki”, and whether they are being as transparent as they should be.

“Are we letting business get in the way of our friendship? It is only business and surely there’s something bigger than today’s win that we should be focused on,” said Wyatt.

Suzuki Swift





SUZUKI SWIFT
A new Swift is on the way later in
2017. Suzuki promises it will retain
the driving dynamics of the popular outgoing model.

 

The brand has guidelines rather than rules and allows dealers to express themselves. Wyatt said there are very few non-negotiables, such as failure to react quickly and properly to a customer lead, whether online or in the showroom. He said the brand has zero tolerance to a customer not getting what they want: “We’re not interested in excuses, because we have all worked hard to get that customer interested.”

He said there are no communication barriers and that Suzuki’s management team speaks to franchise owners every week – Wyatt calls at least two daily, during his drives to and from work. He wants Suzuki to be his partners’ favourite franchise. Its dealers may have bigger or more profitable partners, but Suzuki’s aim is for its franchises to win a disproportionate amount of their time.

As a result, Wyatt said Suzuki can never blame external factors for lack of success. “When you’re a 1.5% share brand, it’s not the market that drives you, it’s your own behaviour and attitude. We know it’s what we do that determines how successful we are. We know if we’re clear what the enablers are and we execute those enablers, we’ll get where we need to be.”

Those enablers include products, marketing, and refreshing the way the business works.

On products, for the first time in a long time, Suzuki has a balanced product mix. In 2015, it was too reliant on Swift, and on Alto the year before. Now it has three models – Swift, Celerio and Vitara – each on track to exceed 10,000 sales this year, thanks to product development, availability of supply and offers. Those three will be joined by a new small family hatchback, Baleno, this month, and a heavily revised S-Cross crossover in the second half of the year. In 2017, Suzuki dealerships will gain a new Swift plus an extra model, currently badged Ignis in Japan, which will be the UK’s first crossover in the A-segment and will tap into growing demand for SUVs.

Suzuki S-Cross





SUZUKI S-CROSS
A heavily revised S-Cross is coming
in the second half of 2016, with Boosterjet engines. Suzuki will treat
it as a new car launch.

When Celerio launched in spring 2015, Suzuki worked on moving sales executives from being price-led to value-led, to get better at story-telling and explanation of the features and benefits. It brought the network together at Rockingham, and banned phrases such as ‘it’s got x, y and z’ in favour of ‘it’s got x, which means the real benefit is…’ so that salespeople could develop a more emotional story.

Suzuki launches its new models with a mid-grade car, before bringing in the entry-grade car months later. This encourages salespeople to talk about the features and benefits of the car, because there is no short cut to the cheapest price.

Wyatt said Suzuki will always be known for small cars and 4x4s. However, he conceded that it needs to work at stretching the brand. It is fighting to get on more consumers’ consideration lists.

 

The ‘Ant and Dec’ effect

Wyatt charged Tammy Charnley, general manager of marketing, with making Suzuki famous, which led to Suzuki’s sponsorship of Ant & Dec’s Saturday Night Takeaway on ITV. The association with the duo has raised Suzuki’s profile dramatically, putting the brand in front of 12 million viewers, and provided engaging adverts for its YouTube and social media channels.

Wyatt has hundreds of anecdotal reports of people coming into showrooms asking about ‘the Ant & Dec car’, a Vitara. Dealers are also busier on a Sunday than they were previously, and 1.1 million people visited Suzuki’s website in the first three months of this year.

Whatever Suzuki does, Wyatt said, it will remain small (even if it doubled its annual volume, it would be a 3% share brand), but that does not mean it does not have its eye on bigger prizes.  

Suzuki SUV





SUZUKI SUV
An A-segment crossover SUV, sold as Ignis in Japan (above), will join the UK range in Q1 2017. It will be
alone in a new micro-SUV market which Wyatt sees becoming much more competitive within five years.

He said success will come by growing its network – currently 156 – to 165 with owner-drivers and regional groups.

“It’s not that we’re anti-PLCs, but we want an individual, bespoke, close business relationship with the most senior person in that business, and the way PLCs are structured makes it quite difficult to do that.”

While its focus is on retail sales, it sees fleet registrations as a growth opportunity, including personal contract hire and local business contract hire.

And while Suzuki’s “vision” is of a network that is more like a friendly family, Wyatt was not afraid to dish out the parental discipline at a recent regional meeting, following 21 of his dealer partners “disappointing themselves” in the first quarter.

“I gave the dealers some tough love, which I don’t do very often. I said: ‘You’re now seeing Suzuki at its best. The market is strong, we’ve great new products, incredibly strong offers and Ant & Dec, and this is when things are going well. If you didn’t have a good quarter, you need to look in the mirror for somebody to blame’.”

 

Moving towards customer-led sales

Ditching old processes is a big challenge for the industry, according to Wyatt.

“The industry needs to revisit the sales process. We know customers are buying cars differently,” he said.

Suzuki’s research shows one third of its customers shop almost entirely online, then arrive close to purchase. Another third spend a lot of time online, but early in their search they visit a dealer for the first time to validate their decision and get an approximate value for their part-exchange. The remaining third just arrive at a dealership they know “because they’ve bought cars from them for years”.

“Each of these customers needs a different experience, and the old road to the sale isn’t valid,” said Wyatt.

Suzuki talks about the ‘non-present buyer’ (NPB), who is a serious prospect, but hasn’t visited a showroom yet. Wyatt said Suzuki wants its dealers to value the NPB as much as it values the physical buyer.

Suzuki is moving towards a flexible sales process, with a sequence of waypoints – such as the negotiation, meet and greet, formal finance aspects such as a demands and needs statement – led by the customer, not the dealer.

“Responding to a customer’s enquiry in real time, through the channel they’ve chosen, is the holy grail,” said Wyatt. “Suzuki is small enough to be able to process every customer in a bespoke, personal way.”



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