Ford’s Fields tells just auto he wants to revolutionise the automotive customer experience
Ford did not have a major new product to roll out at Detroit this week, but it did reveal something – FordPass – that CEO Mark Fields views as vital to a future in which Ford gets closer to the customer as part of a mission to make their lives “easier”. The ambitious sounding aim is to do for car owners what iTunes did for music listening. Along with GM’s recent announcement of its $500m investment in ride-share firm Lyft, we’re now getting a sense of how some automakers are beginning to up their game – or act faster – to embrace change that is coming.
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A range of services will be made available to FordPass members and Mark Fields envisages a future in which Ford becomes an information company as well as a technology company and a maker of vehicles. The relationship with the customer is key.
“The enabling technologies that are available to us today as an industry will take this industry to the next level, not in terms of the product itself but in our ability to have that relationship and provide additional services and benefits to customers.”
However, he’s well aware of the need to remember what Ford is good at. “We have our core business and we love our core business. We are not going to take our eyes off that. That is the engine that drives our profitability.
“For the foreseeable future, particularly outside of urban areas, people are still going to shop, buy, drive and own vehicles the way they have done for many years.”
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By GlobalDataFord’s strategy for the long-term is informed by analysis of megatrends such as the growth of megacities and how demand for transportation is changing. Fields explains the nature of the challenge for an automotive business that has immediate performance requirements as well as an eye on long-term trends that impact strategy.
“You have to have one foot in today and one foot in tomorrow. One foot in today means delivering this month’s sales, this quarter’s financials, this year’s objectives. But one foot in tomorrow means taking a view on what the world is going to look like five, ten, maybe even fifteen years out.
“To help us to do that we are looking at societal factors such as the growth of megacities ([cities with over 10m people]. There are around 28 of these now and projections for the next fifteen years suggest there will be over 40. So that means more congestion in urban areas. There’s also the growth of the global middle class which is going to double in the next fifteen years and a lot of that is going to be in Asia. And then you think of pollution and not only the impact on the environment but the impact on basic health. And there is also changing consumer behaviours to consider. The millennials, for example, are delaying getting married, delaying buying houses. In urban areas for them, access to cars is more important than ownership. So we are looking at these things and saying ‘for us, as a company, how do we embrace these things and how do we, potentially, provide a solution for customers that might want mobility but not ownership?’
“I think it is a natural extension of our business but if we ignore it, we do so at our peril.”
Fields also sees the mission ahead as being highly aligned to Ford’s culture.
“Our culture goes back to our founder, Henry Ford. He was all about how we make people’s lives better. Part of that was putting the world on wheels and allowing people to be mobile and for the first time in their lives go beyond the three miles where they grew up. That still drives us today. From a cultural standpoint in the company, it is part of who we are as a business, which is making people’s lives better, helping change the way the world moves, just like Henry Ford did a century ago. How do we fulfil a market need and also at the same time provide a business opportunity.”
Is he worried about new entrants to the transportation space? He says they can motivate Ford to innovate faster (a view often taken of Tesla’s impact on the auto industry). And he also says that Ford is open to forming new partnerships if they represent the best way to deliver new services that Ford wants to be at the heart of.
“In some cases we’ll do things on our own and in other cases we will partner. Ultimately it is very exciting and positive for the consumer.”
Fields stresses the importance of the customer now, something that perhaps was not always at the heart of the traditional automotive business model. “We want our customer experiences and our relationships with customers to be just as strong as our products. We realise that for many years the focus was on getting people to buy a vehicle; that was the primary focus. Once they owned it there wasn’t a lot to talk about. I think there is a huge opportunity in this industry to create lifelong relationships.”
He draws an analogy with Apple’s impact on music listening. “Think about what Apple did. They had the iPod and it was a great device to use to play music. However, what really revolutionised the whole customer experience around getting your own music was iTunes. That’s what we are trying to do with FordPass. We are trying to revolutionise and improve the customer experience. We want to make it a part of people’s lives, so it makes their lives easier. And we want it to be sticky, so they don’t really want to leave and they also have a very favourable view of us.”
Fields is something of an auto industry veteran and sees a pace of change now that is unprecedented, with Ford having to rapidly adjust to new market demands that create a positive sense of transformation inside the company. The good news for Ford stakeholders is that he also sees new opportunities ahead that can be tapped as the company embraces change. “The clock speed at which the industry moves forward is getting faster and faster. We have gone from an age when we have gone from a manufacturing industry to a technology industry and ultimately added to that we are becoming an information company as customers allow us to take their data and provide services in response to that.”
Don’t get mesmerised
If the auto industry is facing unprecedented challenges and is at something of an inflection point, Fields nevertheless returns to the theme of a need for perspective. “We are also seeing non-traditional competitors that we never thought would be interested in our business. So, you mix all that together and you can see that we are at an inflection point. And we are embracing that and we are embracing it in a way that doesn’t lose sight of our core business, because you can get mesmerised by some of this stuff. If you take your eye off the core business – designing, developing, manufacturing and marketing great cars, SUVs, trucks and electrified vehicles – you won’t be able to take advantage of those other services. To me, it’s not moving from an old business to a new business, it’s just moving to a bigger business.”
