Three steps CMOs need to take now to ride the EV adoption wave
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The UK Government’s announcement that buyers of Electric Vehicles (EVs) could be entitled to grants of up to £3,750 – dependent on a vehicle’s emissions – is a significant opportunity for car makers, leasers & retailers alike to propel their sales of EVs in a challenging market. A chance to accelerate towards or even surpass the 28% of all sold vehicles being fully electric from the current 20%.
What’s more, Ekimetrics’ own EV market barometer shows that the UK’s EV maturity has jumped from 62 to 70 within a year, making it on a par with the French market. And with other government plans to invest heavily in charging infrastructure too, now is the time CMOs & Marketing professionals should be looking to ‘ride the wave’ of EV adoption and adapt their planning accordingly.
Step 1: Strike while the iron is hot
We can learn the lessons of other markets, where more evolved EU markets have shown that it’s:
- critical to take advantage of grants to accelerate growth and push market maturity
- crucial to invest heavily into EV products to avoid falling behind the competition
Both the grants and infrastructure investment will generate greater natural demand with cheaper up-front costs – also helped by salary sacrifice schemes and greater peace of mind on driving range via increased investment in charging infrastructure.
TOP TIP: establish holistic Marketing Mix Modelling (MMM) measurement to forecast the impact of these factors on natural demand and consumer confidence.
Having observed the comings and goings of EV incentives across the major European markets, at different stages of their own maturity, we’ve seen the impact of both their introduction and removal on natural demand and price sensitivity.
For example, in Germany, a subsidised scheme ran along with government backed infrastructure building that drove a twentyfold increase in the number of registered EVs from 2017 to 2022. By 2022, one in four newly registered cars was an EV. However, at the end of 2023, with just five weeks’ notices, the scheme ended. The result was a loss in consumer confidence and a drop in EV market share from 24.61% in 2023 to 20.32% in 2024. This also resulted in widespread reporting of car makers ‘slashing’ prices in response.
Looking to other markets, whilst considering the UK’s specificities in consumer habits, is vital to establishing a robust view of how such incentives could re-shape your demand curve.
Step 2: Define pricing, offers and dealership packages
To take advantage of a ready market, sellers, leasers and dealers in the automotive industry must understand the market’s EV price sensitivity – this is a key moment to get the balance right between driving sales and maximising profit.
TOP TIP: use your MMM to understand price sensitivity and determine optimal margins to drive the necessary cut through
Your price & promotional strategy must be able to drive:
- Performance amidst competitor actions
- Dealership success through the right offer support
- Customer engagement & satisfaction through other marketing incentives, such as servicing/warranty packages
Step 3: Make decision-making easier to stay nimble
To ride the wave of EV adoption, CMOs need to have the ‘what’, ‘when’ and ‘how’ of their media investments at their fingertips. Knowing when to invest more heavily in media support for EV products, the implications on other non-EV products in the range and the impact of decisions on overall sales/revenue targets is the golden ticket.
TOP TIP: Use your MMM in a self-service tool with scenario planning simulations across BEVs, PHEVs & ICE
This will bring more certainty and clarity to holistic commercial planning while maintaining performance across the range. Using MMM in this way allows you to realise both commercial and sustainability goals through optimal strategic and tactical media investments, mix and flighting, taking account of EV discounts and incentives, production pipeline, supply chain, stock, market readiness and more.
For more on how MMM can drive strategic and tactical decisions, check out our many resources:
Podcast (visual): From Marketing Mix Modelling to Econometrics: Top 10 FAQs answered
Case study: Building a Global Marketing Measurement Program for a Leader in Mobility
Case study: Marketing Mix Optimization for a global airline group with existing measurement
Case study: Building a global marketing measurement program for a leading rental provider
Case study: Optimising media investment for a travel operator building a new brand identity
Whitepaper: Making Effectiveness a Strategic Driver for C-Suite
Our solutions: Marketing & Commercial Effectiveness
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