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Superbrands case studies: The AA

The AA is the dominant brand leader in the roadside assistance market. Over the last 100 years, the brand has been built on the quality, expertise and dedication of its patrol force. Their expertise is not only with cars (they fix over 80%of breakdowns at the roadside); but with car owners. This is key to AA's market leading position.

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Market
In recent years, the breakdown assistance market has become increasingly competitive with new entrants and dynamics challenging the hegemony of the big two -- AA and RAC. Insurance companies and supermarkets now offer cheap alternative protection. Furthermore, online services are making it ever easier to shop around for the best deal.

The AA is the brand leader in breakdown cover with a 42.4% share of the personal market. It also has the largest dedicated, liveried breakdown patrol force in the UK. Other brands in the market include the RAC, with a 27.6% share, who also provide their own dedicated patrol force and Green Flag, with an 11.5% share, who provide a contracted garage service. The overall market size is approximately 14m.

Achievements

The AA has won several recent awards spanning the whole business, from branding awards including the Reader's Digest Trusted Brand award 2006 and 2007 and Best Known Co-brand from the National Credit Card Awards 2007, to Best Breakdown Service at the Fleet News Awards 2007 and Best Vehicle Recovery Supplier from the Business Car Awards 2007, for the fifth year in succession. In addition, the AA Team was recognised with the Grand Prix Award from Revolution Magazine in 2007.

In 2006, AA was awarded the Diamond Award at the Institute of Direct Marketing Business Performance Awards; Overall HR Excellence Award by HR Magazine; as well as the Accountancy Age Business Finance Team of the Year award.

Product
The AA provides breakdown assistance both in the UK and in Europe where it operates a dedicated English speaking call centre. For motorists who have experienced a breakdown and need work carried out on their vehicle the AA offers a unique breakdown repair product which offers help with labour and parts costs. For breakdowns, the AA operates in the corporate as well as the individual market where its offer includes breakdown cover for fleets and specialist vehicles, driver assessment, driver training and accident management.

As well as breakdown assistance products, the AA also provides a wide range of other services for the modern motorist. It is the largest insurance broker in the UK with a range of products that extends beyond motor insurance to include, home, travel, life, pet, golf, classic car and motor cycle insurance as well as legal assistance with personal injury claims. AA publishing is the UK's largest travel publisher and one of the top 10 worldwide. The AA Route Planner found on theAA.com generated over three million routes a week and over 150 million in total during 2006. In addition, the AA Driving School is the second largest driving school in the UK and the only one to use fully qualified instructors. The AA also has a Financial Services Business providing loans, credit cards and savings accounts to members and non members alike. AA Signs is the market leader in event road signage and erected over 76,000 temporary road signs across the UK during 2006.

Recent developments
2006 was a busy year for the AA. The AA Members Club was launched giving AA members access to a range of exclusive discounts on motoring and travel related products, from Airport Parking to family days out, MOT's Car Servicing and Car Hire. Also in 2006 the AA joined the Nectar programme; the largest loyalty scheme in the UK, through this AA members can collect Nectar points for breakdown membership and renewal. AA Insurance Services purchased Direct Choice, an insurance broker complimenting its existing portfolio. A number of initiatives have been introduced to the Roadside business. A new Roadside patrol van is being rolled out across the fleet, equipped with new bespoke technology -- Vehicle Recovery System -- that enables the recovery of the majority of cars by the attending patrol. This facilitates a 'one stop shop' by the AA's own dedicated patrol which research confirms is very important to its members.

In September the AA Academy Apprenticeship Programme was launched in collaboration with the apprenticeship learning division of Carter and Carter Group plc, one of the leading providers of Government funded learning initiatives for the motor industry. Finally in 2006 a £1 million investment was made in theAA.com/travel web portal, further extending the appeal of the popular Route Planner service.

Promotion
The AA has been responsible for some of Britain's most memorable advertising campaigns, from 'He's a very nice man' to 'The 4th Emergency Service' and the current 'You've Got a Friend'.

From 1987 to 1992 a series of television, press and radio advertisements were produced featuring the AA's 'He's a very nice man', the 'man who can' helping members in a variety of difficult circumstances. The television advertisements were light in tone, using humour to establish a warm and friendly image for the AA. They also created a catchphrase that lives on today.

By 1993 the breakdown market had become increasingly competitive, new entrants were carving out niche positions for themselves and the AA faced a renewed challenge from an invigorated RAC. Consumer insight revealed that for many people breaking down was an emergency situation. In this environment the AA was viewed in a similar way to the Fire, Police and Ambulance Services. Thus 'The 4th Emergency Service' was born, deploying a real life tone of voice with the emphasis on safety and professionalism. The positioning was that of a market leader, setting standards, leading innovation and motivating people to join and remain AA members.

In 2005, under new ownership, the AA needed a new campaign that focused once again on its core breakdown business. Research revealed that the biggest driver in this very mature market was the quality of the patrols. The communication strategy therefore puts the AA patrol at the very heart of the brand, positioning it as the customers' 'friend' -- someone who can be relied on to help whenever and wherever they are called upon. With the help of Carole King's classic soul anthem, 'You've Got A Friend', the recent campaign has helped grow both brand consideration and retention to record levels. As well as television, the AA also uses press, cinema, radio and online for brand building and a complete range of direct media channels on and offline for acquisition.

Brand values
The AA's key brand values are focused around the brand's relationship with its customers. It aims to be warm, friendly, emotional, expert and offer value for money in everything that it does.

Things you didn't know about AA

  • According to AA research, 98% of AA members who've had a breakdown would recommend the AA to a friend.
  • Throughout its history, the AA has attended over 100 million breakdowns and now attends a breakdown every nine seconds.
  • The AA takes care of 390,000 flat batteries and 300,000 punctures every year and its vans collectively drive over 55 million miles looking after its 15 million members.
  • The most popular destination for routes on the AA Route Planner is Heathrow Airport.

Timeline
1905 A group of motoring enthusiasts meet at the Trocedero restaurant in London's West End on 24th June to form the Automobile Association.
1910 The first AA routes are introduced.
1912 The AA begins inspecting and rating hotels.
1920 The AA introduces pre and post purchase repair checks.
1930 Of the two million motorists on the road, AA membership exceeds 750,000.
1967 AA Insurance Services, the largest broker of car and home insurance in the UK, is launched.
1973 AA Roadwatch is launched to become Europe's biggest traffic broadcaster. AA Relay is launched.
1992 AA Driving School is launched and is the only national body to use fully qualified instructors.
2004 The AA is acquired by two leading European Private Equity firms, CVC and Permira, for £1.75bn.
2006 The AA purchases Direct Choice, an insurance broker.

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