Yesterday Volvo unveiled its new XC40 crossover. Heralded by motoring journalists as Volvo’s ‘Evoque’ moment, the XC40 — its exterior design was led by RCA graduate, Ian Kettle — certainly has appealingly fresh looks.
Yet while it’s this slightly different, fresh and more youthful flavour of Volvo that’s grabbing the headlines, the most interesting aspect of the XC40’s unveil was the announcement of ‘Care by Volvo’.
Care by Volvo, explained in shorthand, is a mobile-phone like contract for your car. You pay a set amount for an XC40 every month — quite a lot more than normal (like £120 more than a monthly PCP), but that monthly amount means all of your costs are included, and — perhaps more importantly — fixed. You don’t need to pay a chunky deposit upfront, your servicing, maintenance, tax and insurance are all included. You basically pay for your fuel, and that’s it. 24 months down the line, you get a new XC40 (or presumably XC60, S60, V90 etc if you prefer). As Volvo puts it, it’s a ‘subscription’ service; you never own the car.
“So what?” you might say — if you lease a car today, you’re effectively already renting it, and Volvo seem to want to add on a sizeable amount extra compared to typical lease and PCP prices for the privilege of wrapping in all your other motoring costs.
I think that view misses the point on a few levels.
Yes, Volvo faces an uphill challenge to get people to ‘see’ the true cost of motoring. We fixate on the headline monthly price, and casually ignore the £3k chucked in at the start, the set of tyres two years down the line, the couple of services, the fix to the bumper scratch, the £300 per year car tax and £50 per month insurance the car also costs us. So how Volvo markets this, will be interesting — as some will surely view it as too expensive.
However, I think the big win for Volvo could come in two key facets of ‘Care by Volvo’.
One is that it represents a truly fixed monthly cost. The appeal of this is rather like fixing your mortgage interest rate. When you take out a mortgage, you go for a (more expensive) fixed interest rate over the 3, 5 or 10 year term because you want to know what the costs will be down the line, rather than taking a chance on interest rate fluctuations. You know you’re paying more per month, at least at first, by doing this. But you’re playing a game. Hedging that, over time, the interest rates will go up and you’ll be better off having chosen to fix. But more important than the bald figures, is the fact that as the user, you’re ultimately sleeping easy that you’re not going to be hit with unexpected costs down the line that you can’t afford.
The second ‘win’ aspect for Volvo will depend on the way that the service is delivered. Can Volvo genuinely manage to make ‘Care by Volvo’ remove the hassle of car ownership? Can they set up your insurance, remove the faff of doing paperwork, dealer-liaison, endless phone calls, comparison sites, remembering to renew things like insurance and tax? — all of the truly painful, ‘I don’t have time for this’ hassle that’s involved with car ownership today? If they can, that will be of huge appeal to some people. It certainly would be to me. How much value would I place on those hassles going away? A reasonable amount each month, certainly.
And there’s more to this, which is where the ‘UX’ gets truly interesting. Volvo’s purchase of ‘Luxe’ — a vehicle concierge and valeting service, means they’re going to offer Care by Volvo customers a form of digital concierge. Valeting, fueling, to you — add in other digital platforms and you’ll be able to do things like get Amazon ordered delivered to your car. And swap your XC40 for an XC90 on Saturday if you need to go to Ikea.
They’re also extending the utility that your car has, by allowing you to share the car with friends and family, in a hassle free-way. Volvo says this ‘comes as standard’ — which we take to mean won’t add extra cost each month.
There are plenty of ‘if’ qualities within this — can all this be delivered, in a way which feels (to use an overused phrase in the world of UX) ‘seamless’? If it can, then Volvo might have just made one of the most significant breakthroughs in increasing a car’s true utility. And be delivering a Volvo-branded user-experience which extends far beyond the car interior. A truly end-to-end UX. That makes Care by Volvo, really significant news. We will watch how it rolls out with great interest.Tags: care by volvo, cars, service design, sharing, UX, volvo, xc40