New Zealand Classic Car - - Local Market Report -

Last month, I wrote about themed events — and the im­por­tance of hav­ing more lo­cal events in­volv­ing clas­sic and vin­tage ve­hi­cles, with the aim of pre­serv­ing and pro­tect­ing our her­itage in this coun­try.

It sad­dens me when peo­ple say to me that the vin­tage car mar­ket in New Zealand is dead, that it is al­most im­pos­si­ble to sell vin­tage cars nowa­days be­cause new gen­er­a­tions are not in­ter­ested in these older cars, and that the cur­rent own­ers have no one to whom to pass these cars.

Alas, there is an un­der­ly­ing truth in this, which to a large ex­tent — not in­ten­tion­ally, per­haps — is self-gen­er­ated. It is why I’ve been ham­mer­ing on all along that au­thor­i­ties in New Zealand need to cre­ate a new mar­ket for these cars be­fore our her­itage ends up over­seas, or, worse still, de­te­ri­o­rat­ing in some­one’s shed.

When mar­kets are flat or go­ing nowhere, as is the case with vin­tage cars nowa­days, one needs to find a bet­ter al­ter­na­tive, and my view is that in­no­va­tion is the only sen­si­ble way for­ward. Un­for­tu­nately, ad­mo­ni­tions to de­velop cre­ative strate­gies or to think out­side the box are rarely ac­com­pa­nied by prac­ti­cal ad­vice, so where do we be­gin?

Mar­ket trends

I have been pay­ing at­ten­tion to this mar­ket for the past 15 years. I have ob­served mar­ket trends and pat­terns, and thought long and hard about how one can save the vin­tage car mar­ket in New Zealand from def­i­nite ex­tinc­tion.

We will even­tu­ally have no vin­tage cars, no mem­bers, and no author­ity rep­re­sent­ing vin­tage cars in New Zealand. Men­tal­i­ties must change, and aware­ness must be raised. We must cre­ate a fun­da­men­tally new and su­pe­rior value to these ve­hi­cles, if we want vin­tage cars to be around us in the fu­ture.

If it helps, I have looked for pat­terns in the way one can cre­ate a new mar­ket and/or per­haps recre­ate the ex­ist­ing one. I have found a few ba­sic ap­proaches that all come from look­ing at fa­mil­iar data from a new perspective — none re­quires any spe­cial vi­sion or fore­sight about the fu­ture.

Most of us tend to con­verge on an im­plicit set of be­liefs about how we com­pete in our in­dus­try, or in our strate­gic group. We share a con­ven­tional wis­dom about who our cus­tomers are, or can be, and what they value, and about the scope of prod­ucts and ser­vices our in­dus­try should be of­fer­ing. The more we share this con­ven­tional wis­dom about how we com­pete, the greater the com­pet­i­tive con­ver­gence.

As ri­vals try to outdo one an­other, we end up com­pet­ing solely based on in­cre­men­tal im­prove­ments in cost or qual­ity, or both.

Strate­gic think­ing

Cre­at­ing new mar­ket space re­quires a dif­fer­ent pat­tern of strate­gic think­ing. In­stead of look­ing within the ac­cepted bound­aries that de­fine how we pro­mote our prod­ucts and ser­vices — in this case, vin­tage cars to fu­ture gen­er­a­tions, — we can look sys­tem­at­i­cally across them. By do­ing so, we can find un­oc­cu­pied ter­ri­tory that rep­re­sents a real break­through in value. We can sys­tem­at­i­cally pur­sue value in­no­va­tion by look­ing over the con­ven­tion­ally de­fined bound­aries across buyer groups, across com­ple­men­tary prod­uct and ser­vice of­fer­ings, across the func­tional-emo­tional ori­en­ta­tion of an in­dus­try, and even across time.

In the broad­est sense, buy­ers tend to im­plic­itly weigh sub­sti­tutes — of­ten un­con­sciously, be­cause the thought process is in­tu­itive for in­di­vid­ual con­sumers and in­vestors alike. For some rea­son, how­ever, we of­ten aban­don this in­tu­itive think­ing when we be­come sell­ers. Rarely do we, as sell­ers, think con­sciously about how our cus­tomers make trade-offs across sub­sti­tute in­dus­tries.

A shift in price, a change in model, even a new ad cam­paign can elicit a tremen­dous re­sponse from ri­vals within an in­dus­try, but the same ac­tions in a sub­sti­tute in­dus­try usu­ally go un­no­ticed. Trade jour­nals, trade shows, and con­sumer rat­ing re­ports re­in­force the ver­ti­cal walls that stand be­tween one in­dus­try and an­other. Of­ten, how­ever, the space be­tween sub­sti­tute in­dus­tries pro­vides op­por­tu­ni­ties for value in­no­va­tion.

It is no won­der, then, that cor­po­rate lead­ers through­out the world see mar­ket cre­ation as a cen­tral strate­gic chal­lenge to their or­ga­ni­za­tions. They un­der­stand that, in an over­crowded and de­mand-starved econ­omy, prof­itable growth is not sus­tain­able without the cre­ation, and re­cre­ation, of mar­kets.

This is also how our vin­tage car mar­ket can re­gen­er­ate it­self and be­come buoy­ant once again: by cre­at­ing a mar­ket that turns our vin­tage cars into in­vest­ments — just like art.

Un­til then, our prob­lem re­mains, and, as a re­sult, we con­tinue los­ing an era of cars; we con­tinue los­ing an in­dus­try that can be saved. How­ever, by sim­ply turn­ing this prob­lem into a fun, fash­ion­able in­vest­ment scheme, we can make vin­tage cars the dar­ling of in­vestors and cus­tomers in New Zealand once again.

Un­til next month, safe driv­ing!

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