Interview with K.Rajaram, CEO of Al Nabooda Automobiles in Dubai and the Northern Emirates
Published on 15 December 2015 by Editorial
Al Nabooda Automobiles LLC is the sole, authorised distributor of Audi, Porsche and Volkswagen autos in Dubai and the Northern Emirates.
Established as a part of Khalifa Juma Al Nabooda group, Al Nabooda Automobiles LLC was launched with a single showroom but has since become a pioneering name in the Gulf’s auto retail industry.
Today, the company boasts the world's largest Volkswagen showroom as well as the largest VW service centre. Al Nabooda Automobiles also holds the status of the largest Porsche dealer for the last eight consecutive years.
Anastasia Varnavskaya, Head of the Automotive Portfolio at Adam Smith Conferences caught up with Al Nabooda Automotibiles Chief Executive Officer - Mr K. Rajaram who told us about the company's challenges, opportunities and expectations for the near future.
Cars are changing and so is the business of selling them. What are the main challenges and biggest opportunities you are facing as a dealership today?
The biggest challenge we face comes from the fact that the market is saturated. Just about every brand is here, so you have to distinguish yourself and the only way this can be done is through customer satisfaction, and by differentiating our models. We see this as an opportunity, and it’s why we have invested so much money in new showrooms in Dubai, Sharjah and Fujairah, and why we work so hard to build an extraordinary buying experience for our customers. When you drive up to one of our showrooms we have a valet to park your car, a service offered nowhere else in Dubai. We’re trying to replicate this across all of our brands to give customers a level of after sales experience that they cannot find this anywhere else.
What impact will increased fuel prices have on the market now that petrol subsidies are being removed in UAE & probably KSA?
In the short term we don’t envisage a noticeable change. But depending on how fuel prices play out in the future, fuel consumption could become an important buying factor. Hybrids will slowly but surely carve out a niche. We do believe there would be a discernible shift in this direction.
With car sales slowing due to economic factors, what other areas of business become especially important? Are there new revenue streams to be capitalised on?
Within the context of our operations, we would continue to put more focus on after sales and customer satisfaction. After sales business is more consistent and stable. When vehicle sales slow down, service provides a window of opportunity to offset notional losses.
What factors will drive dealer profitability in the next 3-5 years?
Profitability and growth simply comes from customer satisfaction. We deliver that by maintaining the highest standards in service, from the moment someone walks into one of our showrooms to discuss purchasing a car, throughout the buying experience and in the way we look after them, and their cars, after that. We have great brands, great products, and keeping the emphasis on great service will drive profitability.
How does your dealership encourage a lifetime of customer engagement?
To engage your customers effectively and build loyalty, you need to go to great lengths to please them, and you need to be innovative in the way you build on your customer service offering. This was uppermost in our mind when we were designing our new Porsche showroom which opened in Dubai earlier this year. We came up with a new service concept, building a cafeteria and covering the workshop in glass. It means you can sit down, have a cup of coffee, connect to the Wi-Fi, check your emails, and glance over to see our skilled mechanics servicing your car. We need only 45 minutes, and then the customer can leave with their car.
Which non-automotive retail brands inspire you?
As someone who places a big emphasis on top quality service for our customers, I appreciate like-minded brands that always put their customers first, and go to extraordinary lengths to please them. Two brands I admire for this reason are Jaeger-Le-Coultre and Rolex.
How does what your clients want today differ to five years ago? Have you seen changes and if so in what way? How are you addressing this as a dealership?
Our customers are now better informed and have a very good knowledge of the product. Therefore we have put a lot of emphasis on training and upgrading the knowledge and skill base of our employees so that we are able to share more about our products with them.
The Government of the UAE is continuously taking serious steps towards clean energy in various sectors (transportation, construction and real estate, etc…), what is your opinion on the future of electric cars in the region?
We’ll see growing numbers of electric cars on our roads in this region in the future as motorists become increasingly conscious of fuel consumption and emissions, and many of them will be Porsches.
For years, Porsche has been at the forefront of electronic mobility in the performance and luxury class, and through new models like the Panamera S E-Hybrid and the Cayenne S Hybrid continues to push the boundaries of possibility.
We’re proud to have been one of the first to bring to the region hybrid vehicles that offer a range of sustainable driving options, both in the SUV and super sport car categories.
And we were particularly honoured when three new Porsche Panamera S E-Hybrids joined the fleet of luxury cars at Dubai Police earlier this year. We delivered them just days after the Dubai government announced it was looking at ways to promote eco-friendly vehicles and is considering incentives for electric models.
At the Dubai International Motor Show this year, we also announced the delivery of 10 Golf GTE models to Dubai Municipality, which will trial the cars over the course of a year as the first Volkswagen hybrids to explore a long-term home on the roads of the UAE. This was a defining moment for us as we begin our pilot and we look to build the future of electric mobility by Volkswagen in the region.
What measures are they taking in the digital advertising space? What is working and what is not? What is the share of digital vis-à-vis non-digital channels in terms of marketing spend?
Digital advertising such as websites, social media and mobile has a role to play across all levels of the sales funnel, from awareness to advocacy. For this reason we utilise these channels as a part of our communication mix.
Digital advertising offers some distinct advantages over conventional advertising because it enables a better target of customers on account of demographic and psychographic profiling as well as enabling the viral effect of word of mouth and it gives the viewer an access to a more convenient response mechanism.
This can pose a challenge as well as given the highly desirable nature of our brands. We often receive responses from individuals who would not be our core audience which results in a loss of time when these individuals are contacted. In order to minimize this we put pre-qualification measures in place.
At present digital advertising accounts for 10% of our advertising spend.
What would you like to wish the readers of Automotive Pulse for 2016?
Firstly, I would like to send complements of the season to all readers of Automotive Pulse, and wish them a happy and safe new year on the roads, wherever they live and drive. I would also hope that they get the service and respect they deserve when they’re buying a car, and that the quality of service they receive continues into after sales. All dealerships have a duty to make sure we look after our customers at all times. It’s what keeps them coming back, but more importantly, it’s what they are entitled to expect.