MIT CDB & Capgemini Consulting Joint Research Program on Digital Transformation

Volvo Cars Corporation: Shifting from a B2B to a “B2B+B2C” Business Model.

Founded in Sweden in 1927, Volvo Cars Corporation (VCC) is “a small player in the global car industry, with 373,525 cars sold in 2010.” The company relies on a network of 2300 local dealers to sell its cars in 100 countries worldwide. Because dealers control the selling process, customer knowledge has historically been owned by the local dealers. Headquarters manufactures cars and conducts market research about classes of customers, but has little direct knowledge of specific customers. Dealers provide sales and after-sales service to customers.

During the past years, however, Volvo is undertaking a deep transformation in its business model leveraging four digital technologies: mobility, social media, analytics and smart embedded devices. The intent is to develop a more direct relationship with the end-customer without disrupting the relationship dealers have with their customers.