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McLaren Automotive launch background II

Almost as soon as the first outline of the McLaren MP4-12C was conceived, a retail distribution network plan had been developed at Woking.

"We were very aware that however well the 12C is designed, however meticulously it is assembled, and however rewarding it is to drive, McLaren Automotive objectives could not be met without a network of partners that shared our values. Especially an obsession for ultimate customer care," explained Antony Sheriff, Managing Director.

"Driving a great sports car is only part of the experience of owning a McLaren. The level of care and support that our customers get after they buy the car is just as important as a fast lap time. Therefore, we began planning our distribution strategy at the earliest point in the whole project. We are now confident not only that we have chosen the right locations, but also that we will have the finest group of retail partners in the sports car sector."

"We stretched our small team to unprecedented levels, visiting all the potential retailer locations around the world. We dissected their business plans and operations, met their service technicians, watched how they treated their customers; all to ensure that 12C owners get the very best treatment. There is very little point in us beating ourselves up over the feel of a switch in the 12C if we have not taken the trouble to ensure that the owners are looked after," he concluded.

Delivering a global network

The network plan had four distinct phases - desk research, field visits, active dealer prospecting and finally, selection and training.

Beginning with an exhaustive research programme on the major metropolitan areas that support large volumes of sports car sales, McLaren analysed concentrations of high net worth individuals and the likely locations to serve each potential market.

The company divided the world into four regions: Europe, North America, the Middle East/ Africa and Asia Pacific, each of which is managed by a local McLaren Automotive management team.  35 retailers have been initially selected in the following regions:  

• Europe: UK, France, Germany, Spain, Belgium, Italy, Switzerland
• North America:  USA, Canada
• Middle East / Africa:  UAE, Bahrain, Kuwait, Saudi Arabia, Qatar, South Africa
• Asia Pacific:  Japan, Singapore, Australia, Hong Kong

Having decided on city locations within the regions, McLaren Automotive then looked at all the major businesses representing premium car manufacturers by visiting each city and understanding the environment.

"This was not just a plan to be run from the centre," explained Greg Levine, Sales and Marketing Director.  "Our desire was to fully understand each market by being there; touching and feeling the environment, talking to dealers and customers. The aim was to physically understand what we needed in terms of a design for each dealership and the processes for building a unified McLaren team on the ground."

"It is vital that our preferred retailers absolutely behave in a way we call 'fit for McLaren' - they have to deliver on the tangible and intangible qualities that are commonplace at McLaren; great performance, high quality, reliability and passion.  'Pure McLaren' is not just about the car itself; it's about providing a 100 percent McLaren experience. We therefore talked to a large number of key players in each city in order to understand the market opportunities and to identify how strong each was across a matrix of five key competences," said Levine.

The five key competences in the dealer selection process

• Experience in serving luxury, high-end sports car customers is not the same as selling executive or luxury cars:  they require one to one relationships between the dealer and the customer.  The potential customer must have confidence that the dealer understands his special, and often bespoke, needs in relation to his car, rather in the same way that a yacht, a personal jet or a fine antiquity is bought, sold and serviced.  It is a close relationship that engenders trust and confidence on both sides.
• The second competence is evidence of professional systems and processes.  McLaren Automotive wants partners that use business management tools and systems that aid their development, a fine understanding of great aftersales, and an outstanding bodyshop process too.  They need to understand the special and unique demands of customers in this sector.  Retailing high-performance sports cars is, and will remain, a highly sophisticated process with discerning customers who expect and deserve special relationships.
• Thirdly, each McLaren dealer needs to be well-funded - able to ride out the economic peaks and troughs without impact to the customer experience.
• Fourth, they need to have an intimate knowledge of their local market.  Relationships are absolutely crucial to success.  Just because a dealer sells sports cars successfully in, say, Beverly Hills does not automatically qualify it to be equally successful in San Francisco.  One of the dynamics observed to a greater or lesser extent across all markets is that customers in McLaren's segment like and expect the process to be managed by a knowledgeable product expert and brand advocate.  But, they also want access to the dealer principal - the man or woman at the top.  Therefore each McLaren dealer needs to be an integral part of the social fabric of their city and market and to know most of the potential customers in that area.
• Finally, every McLaren dealer must understand and 'live' McLaren brand values.  The goal is a long-term partnership with a retail network that has a complete empathy with McLaren DNA - trust, ethics, professionalism, efficiency, confident humility and to believe in, and deliver, the very highest standards of customer service.

The retail distribution network

Having undergone this exacting process McLaren arrived at a shortlist of two preferred candidates for each location by the end of 2009.  Each was invited to prepare a full business plan, a marketing plan and a facility plan and they were then invited to present their plans to the management of McLaren Automotive.  From these presentations a decision was made and the full dealer network appointed by spring 2011.

"There is no fixed template to the size and background of the retailers selected, except that all have outstanding reputations in serving the luxury sports car segment," explained Nick Barnley, Head of Network Development. 

"We have groups and individual entrepreneurs; we have some of the largest organisations with multiple locations representing a large number of brands, contrasting with single operators in single sites.  What is important is that each of these dealers will be McLaren Automotive's eyes and ears across the globe - an integral part of our company:  McLaren Automotive is not the car retailer - our partners are," he concluded.

McLaren has spent a great deal of time in developing a robust financial model for the retail network including costs, investment, revenue and margins to satisfy the company and its partners that the McLaren franchise offers a solid and profitable opportunity.

The McLaren brand has demonstrated its strength during the dealer selection process.  Enthusiasm from the retail sector was very strong from the beginning from those 'in the know'.  Although this was encouraging and reinforced the company's conviction that the business plan was attractive to retailers, the virtual reveal of the 12C in September 2009 brought forth a torrent of dealer enquiries; around 500 by December 2009, in addition to the 100 the company had already identified, displaying supreme confidence in the company, the brand and the business proposition.

"The team had over 500 enquiries, visited over 150 sites, and selected 70 short-listed dealers. From this they chose our 35 initial retailers after a final site visit from a team including our managing director, sales directors, and aftersales director. These visits have been followed by thorough training at the McLaren Technology Centre in sales, aftersales, and test-drive handover processes. We are putting the same level of due diligence and analysis in choosing and training the very best retailers as we do in conceiving the car," explained Barnley

Training

McLaren Automotive has initiated an intensive training programme for aftersales technicians and sales executives.

'"We are focusing on people development within the McLaren network:  this is where we see the key investment," stated Greg Levine, Sales and Marketing Director. 

"With an initial 35 retail outlets we have the capacity at Woking to invite technicians, sales executives and other customer-facing dealership employees to the heart of our business.  This offers the benefit of imbuing our people with a deep and thorough understanding of the product and the conceptual thinking behind 12C, but also a comprehensive insight into the unique culture and philosophy of McLaren Automotive," he said.

In a programme unique to the motor industry, every customer-facing technician and sales executive will not only receive comprehensive training in their discipline, they are also seeing the Vodafone McLaren Mercedes Formula 1 team preparing Jenson Button's and Lewis Hamilton's racing cars, as well as meeting engineers who designed, tested and proved the major elements of the 12C. 

In the case of the technicians, they actually participate in the production process giving them an unprecedented knowledge of the design and functionality of the car.  In short, they are closer to the heart of the McLaren Automotive product concept, the company credo and feel much more a significant part in the process of building a car for a customer.

"It is vital that all of our representatives across the world feel part of our team; that they feel part of the McLaren DNA. They can't just know the facts about the car and its service regime, but feel and understand the whole car and company concept. They should be proud to be part of the McLaren story," Levine concluded.