The automobile detailing and care business has witnessed decent growth over the last few years, with higher disposable income and awareness driving growth in this sector. 3M is a pioneer to set up an organised business around car care in India with its aftermarket division. Auto Tech Review spoke to Ajay Jain, Vice President, Automotive Aftermarket Division (AAD), 3M India, to understand about the performance of the company’s car care business, its successful business model and plans ahead.
3M India follows a franchise store dealership model for its 3M Car Care business, which has been performing well, noted Jain. Through this model 3M has set up over 100 stores in India since its inception in late 2010/ early 2011. The company had in operation around 50 3M Car Care stores in 2015, when Jain joined the organisation, and has doubled its store count in 2.5 years. This was on account of the company’s conscious thinking to enhance its scale of operations, or else it would be lost as a very niche brand, he said.
The company has initiated a number of steps to address this challenge of creating awareness about its services, and these were beyond the basic ones of branding, marketing and demand-generation. Jain said that the company also undertook additional efforts to expand its portfolio of car detailing services. Car detailing currently contributes to around half of 3M AAD’s total business, while the other non-detailing revenues have really caught up, he added. This gave franchise partners other modes of revenue generation from the same investment that they had made, from portfolios including vehicle customisation, paint-protection and other solutions tending towards mechanical performance. Jain said these weren’t the typical solutions offered by 3M at its detailing centres in the past.
3M implemented another important step in optimising costs related to the construction of the structures of car care stores. Additionally, the company was contemplating on whether lower-sized store formats could be a solution to optimise costs. 3M is also following innovative store formats such as fuel station outlets, which are typically small stores that entail low set-up costs and are in a high-visibility zone for the relevant audience. The final new format of 3M car care stores was the mobile units, which are as good as a store in delivering services, noted Jain.
SOLUTIONS, NEW DEVELOPMENTS
The company’s films and graphic wrap technologies are being utilised more in the personalisation space, and is among its fastest-growing portfolios in recent times. The commercial solutions business, which includes cleaning chemicals, is another important part of 3M AAD, in terms of car detailing that is directly focussed towards end-customers driving into the car care centres. Two of the fairly-new solutions developed by the company’s AAD laboratory with a focus on sustainability are the Dry Wash and Diesel Fuel System Cleaner. Another change made by 3M, keeping in mind sustainability, is in moving its entire under-body rust protection solutions to being water-based from solvents-based earlier, noted Jain.
Jain explained that the dry wash technology helps with sustainability as it results in the use of around half-litre of water, against 120-150 l for a regular car wash. Meanwhile, 3M’s Diesel Fuel System Cleaner is focused on passenger cars but it originally catered to the commercial vehicle segment. The low quality of fuels combined with general wear-and-tear, led to clogging of the injectors, which contributed to a significant downtime of the vehicle for servicing or replacing the injectors. 3M’s Diesel Fuel System Cleaner solution is an alternate fuel, which is run through the engine to carry out the cleaning process of the injectors. Jain said that this solution leads to reduction in emissions as well as improved fuel economy.
India has predominantly been a do-it-for-me (DIFM) market, where customers expect solutions to be carried out for them by the stores, said Jain. This is different from majority of the markets that 3M operates in, which are mostly do-it-yourself (DIY) in nature. Therefore, the service part of 3M’s global business is an Indian innovation, he added. Additionally, Indian consumers are also looking at enhancing the premiumness of their vehicles, as well as carrying out higher-levels of personalisation.
Jain said that 3M is looking at setting up car care centres in areas with high vehicle traffic and large parking spaces like office and residential complexes, and is engaged in discussions on these plans. It is also looking to foray into smaller cities to expand its business. 3M India has a concrete plan to set up a total of 165 car care stores by 2018-end, and is also one of the highest contributors to the overall 3M business in India, noted Jain.
On future plans, Jain noted that the company’s top priority is expansion given the rising competition for similar specialised cleaning services in the organised sector. The company will continue with its franchise store dealership model and is keen to encourage existing partners to carry out further expansion of stores and enter newer formats, he concluded.
TEXT: Naveen Arul