UK: Seat sells on sporty image rather than price
"Seat customers buy into the brand because of its sporty image - not price," Seat UK marketing chief Mark McKenna has claimed.
Speaking at the local press launch of the redesigned Leon line of five-door hatchbacks, McKenna said: "Marketing the Seat brand is all about aiming at customers with the undertones of the sporty message being 'for people who do not want to lose their edge' and 'keeping the rebel in you alive'.
"It is a very difficult message to transmit to customers without [breaching] advertising industry guidelines."
A £2 million television advertising campaign breaks in September to launch the new car line.
"Its 'outback' theme portrays the aggressive sporty image of the Leon without promoting speed. The [ad] does not talk about the car at all, it creates excitement and awareness of the Leon and the Seat brand" added McKenna.
He said that growing the brand, established 20 years in the UK, requires an annual marketing spend of £7 million. Forty percent is spent on television advertising, 25% on media advertising and the rest on PR, direct mail, internet and promotional events. For additional exposure, Seat UK is also the 'official' car supplier to Aston Villa and Birmingham City football clubs.
Over and above the marketing budget there is a £3 million motorsport spend, boosted by additional sponsorship of other companies to take part in the British Touring Car Championship and to run the Seat Cupra Championship.
Seat UK will launch the new Leon in World Touring Car guise for the 2006 season at the next round of the BTCC to be held at Knockhill near Edinburgh on August 27 and 28.
McKenna added, " Seat UK has not yet decided whether we will continue with a BTTC programme for 2006 or whether we will put our budget into supporting Seat's World Touring Car Championship efforts, it all depends on what television coverage the British series secures for next year."
McKenna noted that 70% of UK Seat buyers are males, 50% between 25-45 years of age, 75% are married and 75% are employed full-time. He added that 85% of product enquiries come via the internet.
The average age of Seat UK buyers is 41 and McKenna thinks the launch of the Leon will lower this.
"It is important we retain customers to the brand through their entire buying life cycle. From our research there are three consistent reasons that some people do not buy Seat cars. The first is the location of their nearest dealership, the second is the final closing price offered by the dealer and thirdly they just do not like the size or style of our cars.
"At least one of those issues we can address. We currently have 126 UK dealers but if we increase that number to 135 we will have representation in areas where there are younger buyers. The central areas of London, Manchester, Leeds and Glasgow are good examples."
McKenna also plans more promotion of the brand to fleet and business markets.
"Traditionally our retail marketing has driven our fleet business but we have a £1 million budget to promote sales to fleet customers. The new Leon gives us the opportunity to increase sales especially to user-choosers and the leasing business. Currently our business is 60% retail and 40% fleet but we expect this to become an equal split."
The second generation Leon goes on sale here on 17 September as a 12-model line with five engine options and trim levels. Prices range from £11,295 to £17,295.
Seat UK expects 14,000 sales in the first full year once the range is complete. FR (Formula Racing) and Cupra variants will be added in 2006.
Key competitors are the Ford Focus, Vauxhall [Opel] Astra, Renault Megane and the VW Golf which uses similar architecture.
These all compete in the lower medium sector of the UK's new car market, a sector that has grown by 6% so far this year as sales overall fell by the same amount.
Seat UK expects to sell 10,000 first and second generation Leons this year along with 12,000 Ibiza models and around 4,500 units of the Altea.
Last year, sales reached 32,000 units but are 13% down so far in 2005. McKenna expects to claw back some lost volume to reach 30,000.
The loss of the low-price entry-level Arosa range (based on the VW Lupo) and sales of only 1,500 units to daily rental fleets are contributing factors.
"We are concentrating on delivering volume profitably," said McKenna."