How to build Brand loyalty like Volvo? - YouTube

Hi everybody.

The automobile industry has historically been one of the most competitive industries in the world.

Inspite of being an extremely captial intensive industry

the margins are thin, the risk is high

and the industry, in general is extremely vulnerable to both

technologicaal disruptions and global forces.

While on one hand you'll see that even the biggest companies in the automotive industry fail within no time

On the other hand we've got companies that will even indulge in malpractices

just to be ahead in the game.

But even in this super competitive market

there is one extraordinary company that has stood by its ethics

and is even gone one step ahead to help its competition

just so that normal people like you and me can be saved from being killed.

And the generosity of this company is responsible for saving 1 million lives already.

This wonderful company that I'm talking about is none other than the swedish car maker Volvo

and regardless of which domain you belong to

if you only learn and apply Volvo's business strategies to your business

you will be able to build, if not the biggest, at least the most valuable brand in your domain.

The iconic story of Volvo dates back to the 1950s

when the automotive industry was as revolutionary as Internet today.

But the major problem was that

with the increase in the number of vehicles, the number of accidents was rising.

And every now and then, these accidents even made headlines.

So, every automobile company was spending millions of dollars

just to make cars safer.

Because they knew if their invetion clicked

it would be the perfect opportunity for them to become the number one company in the market.

But after working day in day out and after hundreds of failed iterations.

A Volvo engineer by the name Nils Bohlin

came out with the invention of something called the three-point seat belt.

And as soon as it came to the market

every automaker in the market knew that

considering the fear in the minds of the people

Volvo could easily use the invention of the three-point seat belt

to prove and project itself as the safest car manufacturer in the world.

Eventually, it can go on to become the number one player in the market, effortlessly.

But you know what?

Volvo gave away its patent for the seat belt at no cost at all.

In fact, they gifted it to their competitors and even encouraged mass adoption.

Now, just to put that into perspective;

a standard industrial norm is that

great patents offer you a defensible advantage over your rivals

which gives you 20 years of monopoly rights in the US.

If you remember, these patents are the reason why

Gillete was able to become a billion dollar company

and was able to remain a market leader for 20 years.

In this case

even if Volvo charged a nominal $10 in royalty

for every car that their competitor manufactured

with 40 million cars coming on-road

that would make them $400 million in profit

without manufacturing a single car.

And yet, they chose to give it away

And since then

the three point seat belt has saved more than 1 million lives

which makes it one of the most important inventions of the century.

And since then they have made pioneering inventions

like the laminated glass plate that doesn't shatter when broken;

like the booster cushion that could save the lives of 4 year old children

during the times of accident.

And fast forward to the modern day, they are now sharing

40 years of their accident and design research data

with all of their competitors, just so that

regardless of their rivalry, every brand could make safr cars for everyone.

This is what brings us to the first lesson to be learnt from Volvo

and that is conscious capitalism.

As in, you can go on to make a ton of money by building a business,

that's completely fine

but the one thing you need to make sure is that

the money that you're making should not come due to the harm caused to the society.

This is very important because in today's world

while we have got highly dangerous and toxic companies like

*Bhai Chod*

We desperately need companies that can maintain their ethical standards

while they do business.

The second aspect of Volvo's safety obssession is branding.

If you look at the safety measures that Volvo takes, you will be stunned to realize

that Volvo abides by such high safety standards

that even the safety boards do not conduct any such test for that level of safety.

This is the reason why

Volvo is one of the rare companies to get 5 star ratings for their safety.

And the reason why Volvo does all of this is because

their vision is that

safety should become synonymous with the name of Volvo.

As in, the first brand that a customer must think about when they think about safety must be Volvo.

This is what we call as

establishing the determinant benefit of the brand, as in

the singular attribute that separates you from the competition.

And they have done such amazing work that time and again

YouTube videos go viral

wherein Volvo cars and trucks have saved people

who are in such an extreme scenario

that had it been some other vehicle

they would've been killed within a blink of an eye.

And the most astonishing fact of all is that

After selling 50,000 units since the past 16 years

no one has died in the Volvo XC90 model

and this is what brings me to the third aspect of extraordinary brand building

and that is going the extra mile.

In 2015, Volvo took its idea of safety beyond cars

when they realized

that every year 19,000 cyclists in the UK encounter accidental situations

and this was because the car drivers were not able to see the cyclists.

So, they partnered with a startup company and designed something called

'Life Paint'

This was a special reflective paint which reacted to the car lights

and could make cyclists visible even during night time.

And they gave away a lot of these paints for free at the most popular cycle outlets.

And guess what?

Within a week they sold 20,000 Life Paints

and the campaign generated so much online buzz

that the YouTube video got 4 million views in just 21 days

and the campaign generated 130 million global media impressions

with no media expenditure.

And now Volvo has the vision to extend its initiative

towards the safety of the planet by adopting to clean fuel.

This is the reason why Volvo commands a ton of brand loyalty among the Eurpoean consumers.

And they have positioned themselves so well

that tomorrow, if a father wants to gift a car to his daughter

the first brand that he is going to prefer would be Volvo.

Now, there are 3 very important lessons that we can learn and apply to our domain

to build an extraordinary brand.

The first lesson is abiding by conscious capitalism.

We all as entrepreneurs need to realize that

as much as it is important to leverage the internet and the global economy

to build and scale our business.

It is equally important that we take responsibility to not make money through unethical means.

And if you want to build a great brand

money should always be used as a fuel to grow your business

rather than being the fundamental purpose of its existence.

So, do make a ton of money; just do it the right way.

Secondly, you need to constantly keep asking yourself

throughout your business journey as to how are you reinforcing the idea of your

determinant brand benefit in the minds of your consumers.

And when you execute upon those pointers

you will begin to realize

that slowly and steadily, your customers are becoming more and more loyal towards your brand.

And last and most importantly,

while every single player in the market is trying to be the best in the game

by more or less doing similar things

you've gotta ask yourself

how are you going the extra mile to serve your customers.

And trust me

it doesn't matter how small or big that move is.

If you go the extra mile, that is enough to separate you from the herd

because at the end of the day

the only difference between ordinary and extraordinary is that little extra.

In this case, it would be that one gesture,

one act of service towards your customers

that will make all the difference in the world.

That's all from my side for today guys.

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Thank you so much for watching.

I'll see you on Tuesday, bye-bye.