Let me start by making a confession. I love cars.
I love cars regardless of their country of origin, size, speed or age. I am a car nut! Something which I confidently attribute to my (now deceased) grandfather who loved cars so much he spent his teenage years, during the 1930s in Hartlepool, training to be a car mechanic (much to his parents’ dismay).
Not surprisingly, after watching the Spyker episode of Escape from the Boardroom, I found tears of joy and sadness rolling down my face, as the brand names of Maybach and Zagota passed my lips.
While this may sound a little over-dramatic, it captures the very essence that Spyker wants to convey in its brand—passion and emotion. Indulge me as I explain why this television programme induced these emotions.
Spyker beautifully hand-crafts exclusive sports cars (the words ‘produces’ or ‘makes’ are far too crude to use here) and as Spyker prepares to launch the B6 Venator there lies the problem. Can we really call Spyker a car manufacturer or a coach builder? This may sound trivial but this one question highlights the marketing difficulties facing Spyker.
A quick search on the internet indicates that between 2000 to 2012 Spyker sold the grand total of 290 cars, with its best sales year in 2006 when it apparently sold 94 cars! Let us compare this with Porsche’s 8,528 sales of its 911 sports car in 2012.
"Yes, but Spyker hand-crafted cars represent exclusivity", you may rightly argue, but what does this exclusivity buy you? It would appear that Spyker purchases its engines (and I suspect other components) from Audi cars of Germany, so what you are purchasing is more or less a hand-built body attached to German technology.
For some organisations this may be sufficient. For example, the Italian coach builder Zagota has made a profitable venture from taking this approach—converting a brand new Aston Martin sports car to every design whim its customers want (at a price of course).
Yet I fear that some car buyers may not want to purchase a car with bought-in components? Indeed, the now defunct British sports car producer TVR believed it could only be a credible sports car brand if it designed and manufactured its own engines. The result? Excessive research and development costs, customer complaints about engine unreliability leading to warranty claims that bankrupted TVR.
Even Aston Martin, which produced 4,200 sports cars in 2012, has recently announced an agreement with Daimler-Benz’s AMG racing division to gain access to their technology. Building exclusive sports cars requires access to the latest technology, such as traction control, engine management systems and so on, something that Spyker may struggle to obtain.
Without this technology Spyker and its B6 Venator may struggle to get itself noticed in a very crowded market place. While some car buyers may welcome the exclusivity, others may want to purchase a car where its engine is made by the manufacturer, such as Ferrari.
The other issue facing Spyker is its brand name—does anyone outside of fellow car nuts like me actually care, let alone know about the brand?
A brand represents a set of values we associate with a product or organisation. This is important because having a strong brand means the market is aware you exist. In particular, the more exclusive and more expensive the brand, the more awareness we want from other people. (After all, if we were not motivated by brands and what people thought then Skoda would be selling a lot more cars then they currently do in the UK.)
A good example is Maybach. Who, you may ask? Exactly. Maybach was originally a small exclusive German manufacturer of super-luxury cars, who went bankrupt in the 1920s. The brand name passed to Daimler-Benz who, in response to BMW’s and Volkswagen’s purchase of Rolls Royce and Bentley cars respectively, decided in the late 1990s it too needed a super-luxury brand. The decision was that the Mercedes-Benz brand it owned was not exclusive enough, and decided to re-launch the Maybach brand on a range of new cars.
The global market’s response was unanimous—they ignored it. The Maybach brand, unlike Rolls Royce, was unknown and therefore produced no emotional response. More importantly, as nobody knew the brand name, its potential customers felt they would not get the recognition they sought.
The same, I fear, may be applied to Spyker—sadly, only a few people knows the brand or what it stands for. Potential customers spending 150,000 Euros upwards on a B6 Venator may find Spyker’s brand ambiguity too challenging and instead opt for a more recognisable brand name.
Enough now of my tears of sadness, let us discuss the tears of joy! The world needs people who are willing to take risks, indulge their fantasies and produce beautiful objects. Indeed, the rich Americans in the television programme were only too happy to lavish positive comments on the convertible B6 Venator (we will ignore the lone dissenter who commented about the bling value of the car).
Indeed, cars that capture bling (or ‘flash for your cash’ as we say in Britain) appear to be the very thing the important Chinese car market wants. So important is China now to car manufacturers that the new Mercedes-Benz S class was designed specifically to appeal to the Chinese. China may then represent the saviour of Spyker, as Victor Muller Spyker’s CEO notes.
Although Spyker makes a beautiful range of cars, it faces a number of market obstacles in launching the B6 Venator. The huge costs of marketing combined with Spyker’s own declaration that they have yet to make a profit would worry all but the strongest entrepreneur.
For car nuts like me, let us hope the Chinese like the B6 Venator.