The Secret to Land Rover’s Explosive Growth and Why the Next Defender Won’t Please Everyone
The last few years have been unusual in Land Rover’s history. Despite a flood of new premium utility and crossover vehicles competing for the audience Land Rover once had to itself, the company has experienced unprecedented growth thanks to its broadest product lineup to date. Yet many of the brand’s most loyal customers worry the new products have gone soft. We recently sat down with Kim McCullough, Jaguar Land Rover North America’s Vice President of Marketing, to talk about what’s driving the growth, the challenge of maintaining authenticity, and what she knows about the next Defender.
Alloy+Grit – The last several years have delivered strong growth for Land Rover in North America, with more than 70,000 vehicles sold in 2015 (compared to just over 26,000 in 2009) and on track for even more this year. What’s driving the growth here?
Kim McCullough – Clearly we’ve had a great run of launching new models. We expect 2016 to be up about 8% over last year. On average we’re bringing in over 80% new customers to keep fueling this growth. A lot of conquest. Most of our marketing efforts – not all, because obviously we do a lot with our [existing] owners – is getting new people to come in an experience the brand. We’ve seen that with Evoque consistently year after year, and now Discovery Sport is doing the same thing. Our highest loyalty product is Range Rover, so I’d say the Discovery Sport and the Evoque are the entry point into the brand.
A+G – Do you know what brands you’re pulling these new owners from?
KM – The usual suspects, I’d say. Other European brands. With Discovery Sport we’re seeing a lot of people moving up to a premium brand for the first time. So a lot of more mass-appealing brands are helping to feed that growth. It’s exciting. And we expect the new Discovery to appeal to a much broader group than perhaps the outgoing product, while being every bit as capable.
I think that’s the thing that surprises people a lot. Because visually, as we move to a more modern expression of the brand, people can take that as, “they’ve lost their soul and gotten soft,” but the [performance] stats on the Discovery are very, very strong. And we made sure that was something that as we get closer to the actual market launch, we’ll put that front and center so people know that it hasn’t lost its abilities. We know who we are, we know what we need to deliver.
A+G – Land Rover once owned the premium utility market. How does the product line stand out today with literally every other premium manufacturer producing an all-wheel drive utility vehicle of some sort?
KM – One could say we invented the premium utility market. I’d say “authenticity” is what stands out. Whether you’re a millennial or whether you’re a buyer that’s been with us for a while now, you want to know that what you expect a Land Rover to have from the beginning, it has today. That’s what’s been unwavering from the origins of the brand and that’s why we need to keep that alive. I think that’s what makes us stand out. It’s not just a commercial opportunity, it’s absolutely who we are as a company. And people see that differently. People like the history, they like the story; whether they’re 35 or 55, it’s really important to people.
A+G – Do you find your new buyers connect with the history?
KM – They do. We see it on Instagram. We see what people respond to when we post certain types of photography. When people see the older models or pictures of off-roading – or experiencing something off-tarmac – people respond to that. We see the likes. It tells us this is what people like, what they expect it from us. It reinforces what we stand for.
And that’s important because people can say, “Oh, is that even important anymore? Do people really go off-road?” But we do have a higher incidence of people going – let’s say, off-tarmac – because not everyone goes boulder hopping. Sopeople like to know that they can do that and have that capability. It’s every bit as relevant still today. And that’s what’s so gratifying, because we can be true to ourselves and true to our customers and still offer what they are looking for.
A+G – How does Land Rover’s Classic effort play into the success of the company’s new models?
KM – I think it’s great when companies recognize and embrace their history. So that’s what you’re seeing with the JLR Classic efforts. Most of that is UK-based right now. We are having discussions about what may end up happening in the US, but it’s still in its infancy. To be able to have some of those classic experiences – even at our driving schools, to have those classic vehicles on hand – is something we can do.
When we did the Great Divide trip recently, we had one of the original Range Rover Classic Great Divide vehicles there, and the owner was nice enough to let some of the other people drive it. Once you get into that, you get a whole new appreciation for the modern stuff, because you’re really working.
That’s why I love [driving] the old stuff, because it gives you an insight into the brand. And if you can feel that connection to the modern product, that speaks volumes – for any company, but particularly with some of the products we’re making.
A+G – Jaguar and Land Rover have long enjoyed separate but fairly complementary relationships. How do Jaguar SUVs now change or even complicate that relationship?
KM – Yes. We re seeing some interaction between the [Jaguar] F-Pace, the Range Rover Evoque and the Discovery Sport, especially since the majority of our dealers are now dualed. So you can now go into a dealership and turn left or turn right and it’s easy to cross-shop those products. It’s not a huge amount of interaction; the Jaguar SUV [customer] is a different buyer. They’re looking for more of a “tarmac performance” type of expression, a bit different in terms of design focus compared to a Land Rover shopper.
What Gerry [McGovern, Land Rover design chief] does and what Ian [Callum, Jaguar design chief] does is right for those respective brands. Jaguar is all about performance and seduction, and Land Rover is all about capability and composure. So those attributes drive the respective design focus and attract different buyers.
A+G – With Bentley and Aston Martin now entering the SUV space, is there pressure to take Range Rover to new levels of luxury? And how do you outcompete someone like Bentley in terms of luxury in that arena?
KM – By staying focused on what we do best. You have to be aware of what your competitors are doing, but you don’t let them knock you off your game. We know who we are; we know what our customers expect from us. We’ve already been pushing Range Rover to new heights. We now have the long wheelbase, the Autobiography. We’re already getting to quite significant price points and we haven’t seen the ceiling yet. Sometimes you don’t know you’re boundaries until you exceed them. We haven’t reached that moment yet.
A+G – As a classic Land Rover owner yourself, how do see Land Rover’s roots as a maker of simple utilitarian vehicles relating to its position in today’s market?
KM – Well, I think that’s where you look across the [Land Rover] offerings. We will have the Defender back in the fold; we’re working on what the next one will be. So when you look at the three families [of Land Rover vehicles] with Discovery, Defender and Range Rover, it allows us to expand to more people, but still have offerings with those core capabilities.
Vehicles in general are clearly not as simple as they used to be. You need more than a wrench out there to get things going again. But [the three-family lineup] allows us to really appeal to a lot of different interests. A lot of people are really, at their core, looking for a brand that still has that capability. And the “composure” piece is really important, because I think that’s one of the things that set us apart in the marketplace. You can have a very capable vehicle that’s also very punishing, but we need to be able to offer both those things [capability and composure].
A+G – Expand on that idea of composure. How do you define it?
KM – Range Rover is probably the pinnacle of the statement of those two elements. You can take a long drive in a Range Rover and you don’t feel tired at the end of it in the way that you might when you drive certain other types of vehicles. It’s not stressful; you don’t find yourself grasping the wheel harder than you need to. It just feels comfortable, there’s great visibility, and it’s just easy to get into. And that’s why for so many of our customers who own multiple vehicles, the one they use daily is their Range Rover. No matter what the situation, it’s appropriate.
A+G – At the other end of the market, Land Rover has always been a fixture in third-world settings. Is that a segment that’s worth going after these days?
KM – Well, we do have an association still with the International Red Cross and Red Crescent Foundation, so we’ll continue to participate in those types of programs. It goes back to the heart and foundation of the brand, so we won’t be walking away from those efforts. We’re also associated with TUSK, one of the foundations the Royal Family is involved in that help with wildlife preservation. So we’ll continue to do those sorts of things on a global level.
A+G – But in terms of building vehicles for less developed markets, is that something you’ll just concede to Toyota or other manufacturers?
KM – We’ll see what Gerry has up his sleeve for the next Defender.
A+G – Is there demand for a truly utilitarian Land Rover these days?
KM – I think all of that is being taken into account as we develop what the new Defender will look like.
A+G – The next Defender is clearly not so far away now. Are you confident it will resonate with Land Rover traditionalists, or is it aimed at an altogether different kind of buyer?
KM – There is going to be so much attention when this [new Defender] comes to market, there’s no question. There’s going to be a group of people who will not like it, because they are traditionalists and they like the historic visual expression of the brand. But it has to have the capability that one expects from Defender and Land Rover. I think it will have the goods.
This is going to be a new, modern expression, but we haven’t left behind what you would expect of it in terms of capability. Defender is a model that can stretch by itself from something that is very basic to something that is perhaps a little more luxury focused. You’ll probably see a wide range there. It’ll be fun; I can’t wait.