Volvo goes online to sell revamped XC90
Volvo research confirmed a trend to online auto purchases so the automaker wanted to make sure it wasn’t left behind.
“By 2020, five per cent of car purchases will be made online,” Margareta Mahlstedt, vice-president marketing at Volvo Cars of Canada, told Canadian AutoWorld. “Canadian customers are more informed online before going to a dealership.”
Mahlstedt went on to say that because of this change in buying behaviour, consumers do less cross-shopping and make fewer dealership visits and test-drive less.
So the Canadian arm of Volvo International took part in the international effort to sell the first 1,927 of the XC90, 2016 edition.
(The automaker chose to put 1,927 XC90s on sale because the first Volvo left the Gothenburg, Sweden assembly line in 1927.)
Canadian customers were competing with Volvo shoppers around the world.
Anyone wanting to own the First Edition could go to the dedicated website, put a $4,000 credit card deposit on the $81,500 vehicle, choose a dealer then go into the dealership to do the usual paperwork to close the deal.
“It’s very simple as if you were ordering a book from Chapters,” she said.
Mahlstedt is cautious when she uses the word sell because she said Canadian banking regulations seem to frown on an automaker completing a transaction online. So the automaker will not hold a deposit.
“It’s not being held by us; it’s funneled to the retailer in its entirety.
The dealer has 21 days to solidify the contract and when we receive it, the deposit goes to the dealer.”
She also stresses that the automaker has no plans to do away with its dealers. It is simply helping its dealers take advantage of technical advances in the digital world.
“By doing something like this, we are handing the dealer a hot lead and all they need to do is to focus on the relationship with the customer.
“That’s what is important. We are taking some of the selling part out of it and that means encouraging the relationship more. That’s where the big win is.
“We are in no way cutting out the retailer. This is designed to drive traffic to our retailers.”
Mahlstedt said dealers were aware of the project and enthusiastic. Their role was to do the selling; they had nothing to do with the interface.
She also stressed that the effort was just a pilot, a test, not the roll out of a full-scale turn to online selling despite the trends.
“This is a pilot. We will see how it goes. This is a trial.”
The XC90 effort was just one in a number of moves the automaker is making to keep in step with digital trends. She said Volvo Canada will be launching a platform next year to “ease the ownership experience” in a variety of ways. She would not offer more details. But she did say online service bookings are now available to owners of new-model-year Volvos.
Mahlstedt explained the reason for choosing the XC90 was the interest in the refresh, the first since the crossover vehicle went on sale 12 years ago.
“This is a vehicle whose refresh has been long awaited. The question is will the consumer be willing to buy something at this price point online in the future? These are things that are unknown today.”
It didn’t take long for the automaker to get an answer. The portal opened for business Sept. 3 and, according to Motor Trend Magazine, the 1,927 individually numbered units, each with a leather key fob carrying the First Edition logo, sold out in just 47 hours. That’s seven cars a minute. Most went within an hour.
Canadian AutoWorld wanted to know how many Canadians would be driving off with a First Edition XC90. Mahlstead said Canadians ordered 60.