Ad Blocker Detected
Our website is made possible by displaying online advertisements to our visitors. Please consider supporting us by disabling your ad blocker.
Wouter Witvoet—CEO and Founder of EV Technology Group.
In a space as fiercely competitive as the automotive industry, maintaining an advantage is top of mind for all players. Especially as the race for electric vehicles stirs up competition between seasoned automakers and emerging brands, this has created pressure to remain innovative and find solutions that address different driving habits and lifestyles.
But what truly gives one brand a competitive advantage over another? Some would argue that that lies in technology.
Technology has always played a significant role in the industry. In the consumer automotive revolution of the early 1900s, Ford set itself apart through advancements in the manufacturing process—building the first cars in a streamlined, mass-production facility. In the 1960s, the British Motor Company introduced the Mini, which redefined how passenger vehicles would be built, and featured a transversely mounted engine design that would become the standard for future front-wheel drive vehicles. Fast forward to the 2000s, and Tesla’s high-powered battery technology has established the company as a leader in the EV race by demonstrating the possibilities of long-range and everyday EV use.
Each of these companies has used technology to help them lead the pack. But at some point, these same technologies that once set them apart are replicated, reproduced and enhanced at an accelerated rate across the industry.
As technology commoditizes, what then?
When technology commoditizes, as it so quickly does in the automotive industry, employing it no longer gives automakers an edge but rather brings them on par with the base level of expected operations. For example, what were once novel and exciting features, like a rear-view camera and parking assistance, have become standard features consumers come to expect.
With similar offerings across all major brands, success isn’t hinged on whether a car has that extra bit of horsepower or slightly increased battery storage; it comes down to the ability of a brand to connect with a very specific customer need or desire and sometimes—an emotion.
Think about some of the top automotive brands in the world. Each has a powerful connection with its consumers and is known to deliver a specific value. Ferrari, for example, is a marker of success, passion and history, while a brand like Toyota represents durability and longevity. For car enthusiasts, who may have grown up with posters of these cars on their bedroom walls, there is a kept promise of character and style, no matter the model, advancement or decade. One of the most ambitious dreams for many people is buying a Ferrari when they “make it big.”
Building that affinity with consumers takes time and a significant investment. With the average ad spend for EV brands starting at $33 million, investing in a new brand demands a hefty upfront expenditure without any guarantee of success.
Prolific, classic car brands have established these characteristics and connections for themselves long ago. The groundwork to be seen as a symbol of status or exclusivity has already been made. Take Moke, for example, a company I work with. Popularized by the glamorous French actress Brigitte Bardot in the ’60s and later a choice of the peerless spy 007 in four James Bond movies, bringing Moke to the electric world has the potential to utilize its existing brand equity and consumer connection with it—providing car fanatics who might not have considered an EV a new option.
While this tactic has also played out elsewhere in the EV world, recently, Volkswagen announced it would bring back the defunct Scout off-road brand as an electric SUV. But this tactic of finding dormant brands might be best known for its impact in the world of luxury fashion. Louis Vuitton was known to acquire dormant brands he called “sleeping beauties” (paywall) and support them through a transformation to create a successful revival—one of the most notable examples being Dior. Bringing brands to a new world, whether that’s fashion or EVs, carries existing brand equity and consumer connection with it. For the automotive industry, it offers car fanatics who might not have considered an EV a new, intriguing option.
Leaning Into Existing Grand Equity
For many of the emerging startups in the EV space, strategies are centered around building entirely new brands from the ground up at a mass-market scale. While this strategy may work for a select few, the saturation of the market and the strong brand equity that their competitors have already built with consumers have these startups playing an expensive game of catchup. While many startups promise far-out plans, revenue projections and solid-state technologies, you should recognize that it takes time to build affinity with consumers and consider existing brand equity of beloved and dormant companies.
As automotive technologies continue to be commoditized, similar to other industries, I believe consumers will continue leaning toward the brands they know and love. For companies catering to this visceral driving pleasure, there’s a wider societal impact, too. When the brand’s car fanatics learn to trust and enjoy electric vehicles, they have the potential to accelerate adoption by luring those who might’ve turned a blind eye. As a result, I believe what will ultimately make or break the driving experience in the EV world are brands with real customer connections that can bring people into the EV revolution now.
Forbes Business Council is the foremost growth and networking organization for business owners and leaders. Do I qualify?