Smaller Budget, Sales Rumors Don't Deter Volvo Marketer

Five Questions for Michael Persson, Director of Global Marketing Communications

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DETROIT (AdAge.com) -- Michael Persson has worked his entire career on Scandinavian brands, arriving in his current job as director-global marketing communications of Volvo Cars last August after 20 months as marketing and sales director of the Royal Swedish Opera. The 48-year-old Swede also worked as marketing director of Absolut for six years and before that was brand manager of Scandinavian Airlines.

He assumed his post at Volvo at a tumultuous time: just a few months before Ford Motor Co. announced it had begun a strategic review of the brand -- and despite speculation that Volvo was going on the block following Ford's sale of Jaguar and Land Rover. Two months later, he found himself with a new boss, Stephen Odell, who moved from Ford of Europe to become Volvo's global president-CEO.

Like other global car companies, the niche brand saw its sales drop last year -- 18.9% from the record 374,297 new vehicles it sold worldwide in 2007. Volvo sold 73,102 units in the U.S. last year and 106,213 in 2007. Its best-selling model in 2007, the XC90, saw sales slump as Americans shunned big SUVs when gas prices skyrocketed. The automaker laid off 6,000 people globally last year.

Although Volvo is still struggling, along with the rest of the industry, the brand has made some progress in the U.S., posting sales increases in February and March after a disastrous January. The smaller, new XC60, which went on sale in February, jumped to the brand's third-best-selling model in April and held that slot in May.

And although Mr. Persson said the recession and lower demand for cars has led to a reduction in overall marketing spending, he said Volvo is shifting more attention to online advertising to "reach out to new customers and also to our loyal customers. The consumption by consumers is there for us. And our website is getting more important, and that is accelerated by the recession."

Mr. Persson talked candidly with Detroit Bureau Chief Jean Halliday about his goals for Volvo.

Ad Age: What changes have you made since you assumed your new position and why?

Mr. Persson: We did change the organization a lot in order to be more focused on all communication channels, so that centrally we are producing more assets for all the local markets. Also, we have people in the marketing department that are also our links to the local markets. I thought that was really important in order not to invent things that don't have a need or an impact on the local communications. I had that before from working at other companies -- people who are connecting the local markets to the headquarters.

Ad Age: Have you made any changes in marketing strategies?

Mr. Persson: We changed the tone of voice of all our communications, which is a good thing because we want them to stand out more. We wanted Volvo to be more impassioned and emotional, and we also wanted Volvo to be bolder in communications.

Ad Age: What tactic have you tried that didn't work and what lesson did you learn?

Mr. Persson: I wouldn't say any didn't work; some were so-so. When I was with Absolut, we tried the "Seven Sins" ads. They were multimedia at the same time as the film "Seven" with Brad Pitt. It was off strategy, so we took it back.

It's important for marketers to dare to fail. You must have a feeling in your stomach that you don't know how something is going to work. It's always important to go a little outside your comfort zone to try to extend the brand. If you don't dare to fail, you're never going to grow as a brand.

Ad Age: Before you joined Volvo, what was your take on auto advertising in general?

Mr. Persson: To be honest, car advertising is boring. You see a black background with a very beautiful car and it says, "Here is a beautiful car. Buy it." I have put a lot of print car ads on my walls here, and they all look alike. You have to be different to stand out. You can't go out and think everybody will like you.

Ad Age: What do you see as the major challenges facing Volvo considering the global auto-industry slump?

Mr. Persson: The major issue for Volvo is being a small brand and not having the spending other brands have. We have 1% share all over the world, and if we could increase our market share by 1%, that would mean success for Volvo. We have to be something different and be appealing and really be focused in our communications, so we have to select our target group and forget about the others.

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