The changing requirements and actions of customers are occupying the mind of Leaseplan UK’s new managing director Matt Dyer as he settles into the job, four months after stepping up from his previous role of commercial director, which he held for four and half years.
Dyer replaced David Brennan, who had bossed what is now the UK’s number two leasing company for more than eight years before announcing his departure to head up Nexus Vehicle Rental at the beginning of this year.
“From my perspective it feels like the next step, and I would like to think that’s the way it feels for the business and for our partners and the people we work with,” Dyer tells BusinessCar. “Being a known quantity, they have confidence in the way we’ll move forward.”
“As commercial director in the UK, it gave me an opportunity to get a very good perspective of the market and what customers expect and need; it helps a lot and gives a platform on which to work,” he continues. “We’ve got a major digital programme taking place and I’m now looking at things from a managing director rather than commercial director perspective.”
That knowledge of the business is something Dyer points to as a key positive. While admitting that people coming in from outside can bring a new perspective, having a grasp of the various divisions of Leaseplan is important. The firm operates across its Automotive Leasing public sector division, LeaseplanGo for SMEs, Network for franchisees, and the core Leaseplan contract hire and leasing arm.
“Having a grasp of that in a period where a lot is changing and the opportunity to improve is important – we don’t want to lose that momentum.
“We’ve got great breadth in terms of what we do. We will need to back [the areas] where we see key opportunities – what we’re looking for is growth opportunities,” he continues, viewing the shift to digital consumption as crucial to how leasing companies will operate going forward.
“We are moving into a phase where your vehicle and the lease around the vehicle is increasingly seen as a utility. For example, £65 a month on the phone, £45 on broadband and £240-£250 for personal lease – a lot of that is happening with PCP through dealers, but we see good opportunities for that,” says Dyer.
“In a lot of those cases the consumer is the driver, so digital capability is going to be critical. It’s how, not if.”
He believes that the pace of change with how people communicate with phone, tablets and apps won’t ease.
“We can bring the strength of experience to a wider customer base. It would have been very different five years ago as we would have been only human touch – now, if you can blend digital and human you’ve got a fantastic opportunity, and it is something our customers expect us to deliver,” he says. “Increasing digital capability will be a crucial part of my tenure as Leaseplan UK managing director, and it brings the issue of mobility, and allows us to bring the right products and advice.”
Dyer reveals that the firm is currently working on an app and a web portal aimed at both drivers and fleet managers, while its Quote and Order online service will see improvements before the end of the year. The goal, according to Leaseplan, is to provide an experience “personalised to the client’s organisation, the relevant car policy, the individual’s role and the individual’s personal requirement”.
“Working hard on the app and portal, the first intention is quote and order tools, very much bringing a consumer feel as it’s what people expect,” explains Dyer. “There is also an opportunity to bring more insightful tools in fleet reporting – message centre technology to have constant dialogue with drivers on things that matter to them.”
The app is already being trialled with selected customers, and Dyer says more can be expected on that before the end of the year.
“Over the next 12 months it will be a significant journey of delving into digital capability,” he predicts. “It allows us to serve an even more diverse customer base in ways consistent with the strengths of the way we serve customers today.
“We definitely don’t want to move away from the strengths we have – level of service delivery and levels of loyalty within the customer base. It’s something we have to continue to nurture and grow. We can’t rush so fast that we leave that behind, and digital is a bridge to allow us to do that.”
Growth
But Dyer’s focus isn’t solely on digital developments, and he is seeking continued growth across various areas of the business on the back of improving market conditions in terms of new vehicle registrations and both consumer and business confidence.
The company is up 5000 vehicles year-on-year, particularly with its SME business through the Network brand, and with commercial vehicles, which now number 38,000 units.
“When you look at areas like SME, the sector is a very important part of the UK economy, and not so used to leasing as the corporate sector, so opportunities that exist there will be very important,” he declares.
“LCVs are a different dynamic. You are very close to the core business of customers you are working with. The core service proposition has to be very good. [You are] expected to meet the needs of the customer.” At present, only half of light commercial vehicle operators lease their vehicle.
“We put a new team in three or four years ago [led by head of commercial vehicles Mark Lovett] and it’s grown 30% in that time,” Dyer continues. “It reflects the increased appeal of leasing to CV audiences and that we’ve got the right team in the right place at the right time.”
Dyer says the commercial vehicle market is changing in terms of awareness of weight, payload and capacity of the required vehicles.
“Our focus is on the light to medium CV area – that’s where our expertise is and the most important priority in terms of what we bring,” he says. “We want to see in what areas we can offer advice to customers, to understand their needs to do their business.”
But it’s not just selected areas Dyer is targeting, and despite increased competition he’s looking for increases across the board.
“We’re very excited as a business. We’ve invested a lot, particularly over the last few years with Network and LeaseplanGo, backing brands with a view that they have the capability to grow and giving them the foundations to do that in the right way,” he says. “I don’t feel we’ve got anything we’d consider a barrier to what we can achieve. We see opportunities to enlarge the leasing market and that’s an important part of what we need to do – identify opportunities and innovate and change around them.
We’re not just going to be doing the things we do better, but bring leasing to a wider automotive market – particularly in the retail arena that requires a different way of thinking.”
He sees individuals accepting that £199 or £225 a month on a small vehicle is a reasonable expense alongside broadband and mobile phone monthly bills: “That will be a major growth opportunity and we’re making sure we’ve got the capability to do it.”
That retail focus will have the knock-on effect of increasing Leaseplan’s buying power, with the associated economies of scale, in theory at least, helping to control monthly rental rates.
Understanding
As the industry becomes more diverse and demanding, taking the time to understand customers’ businesses to a higher level than the leasing industry has been renowned for will, according to Dyer, become crucial.
“There are quite big differences between the types of vehicles people operate and the type of relationship they want to have with their leasing and fleet management company,” he says. “Understanding the priorities, with LCVs truly wanting to outsource, for example, and cars, where people want to keep fleet management and fleet teams in place – it’s very different, and I firmly believe we are in a great position to deliver our expertise and service, and target the specific requirements of the customer.
“Perk fleets wanting to outsource and CV fleets wanting to outsource are very different things,” he continues. “We’ve got to understand how the vehicle is being used and tailor our approach to that. You’ve got to have the ability to see them. You do need to vary the approach according to the particular approach they have – not everyone wants to do that.
“The point I’m trying to make is that the level of understanding is going deeper – the expectation is to be very close to particular developments,” says Dyer, pointing again to the example of light commercial vehicles: “You really have to understand how the company is using these in order to set up the right service around them – how they’re using, what is the pressure in terms of productivity. In the past, people paid lip service. It’s the same in the perk arena – you really have to understand how an organisation wants to reward and motivate employees and understand what outcome they want.”
Looking ahead, Dyer feels increased use of telematics and technology can help morph car leasing into more of an all-round mobility solution.
“The data relationship and digital relationship will be an important bridge to allow us to reflect mobility requirements much more in our offering, and understand at different points in time when people need access to vehicles,” he says.
“We almost presume people want a vehicle all the time, but we’re growing access through digital capability and taking data from telematics so we can model and be more proactive.
“We need to be bold but evolve at quite a pace – it’s exciting times,” he says. “And it feels that we’ve rapidly left behind the doldrums.
We steered a very steady course through the tougher economic times.
“In the space of 12-18 months the landscape has changed very quickly and there are lots of reasons to be positive about the UK economy,” Dyer concludes. “And in terms of capability, we can put on the table a stream of new service opportunities and relationship opportunities”.
Free Leaf
In a move to help gain greater understanding of the electric vehicle market, Leaseplan has recently taken on 15 Nissan Leaf models on a two-year buyback from Nissan. The plan is to offer them to customers, prospects and franchisees on a three-month free-of-charge loan basis to “experience the reality of electric motoring in everyday conditions”.
The only conditions are that the user has to return the vehicle damage-free and provide feedback on their electric vehicle experiences. According to Leaseplan, it has already had a broad take-up from both private and public sector organisations, particularly in Scotland.
On the Up(time)
One light commercial vehicle development Leaseplan points to as an example of its understanding of customer needs and using new technology to help them is Uptime. Described by the firm as applying “an HGV discipline to running an LCV fleet”, it’s a development aimed at heading off vehicle downtime and cutting maintenance costs through the use of telematics to proactively book and manage servicing and maintenance.
“It’s very much service-driven rather than vehicle-driven. We’re at the forefront and looking to develop,” says Leaseplan’s UK boss Matt Dyer.
The system also fully documents vehicle maintenance history to give a record for duty of care compliance.
