When Car Loan 4U launched in 2006, its co-founders James Wilkinson and Ryan Dignan chose a name that was functional, and easily told the end-customer what the business did. Nine years later, and the company has grown into one of the largest brokers in the industry and, as a business, Car loan 4U found itself doing an increasing amount of work beyond broking. Following a substantial investment from Scottish Equity Partners in 2014, the company rebranded to Zuto in May. At the time, Wilkinson said the new name offered a blank slate to set about its ambitions. Motor Finance caught up with him to discuss the rebrand.
How has the rebrand gone?
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The rebrand has gone very well. Lot’s and lot of planning nights and hard work have gone into this – we’ve been planning it for 18 months. But we’re really happy with the results. We’re a data-driven business, and the expectation was for quite a substantial decline in the first four weeks, but we’ve not seen that and traffic has actually remained steady, and so has the flow of business.
What were the hopes of the rebrand in the longer term?
Car Loan 4U has been good for us. We would still describe ourselves as a start-up business, but we’ve matured a little. So Car Loan 4U gave us a very functional name, which said what we did for a period of time very well. But over the last 18 months we’ve done unbelievable amounts of research, spoken to thousands of customers and we’ve found that it’s more of a challenge to let our customers know what we do. This is because the name Car Loan 4U is so functional, when actually we’ve become all about being a better way to buy a car. When a customer comes to us we remove all the friction from buying a used car. So we make sure the dealer’s right for the customer; we value as many cars as they want us to and we make sure the car hasn’t been written off or stolen, and we make sure the finance is right.
So the finance is only part of the overall experience. We wanted a name we could build that experience around, as opposed to a name that was very functional, but made it almost a bigger challenge to explain that we do more than just finance, because it’s just so descriptive.
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By GlobalDataAnd that’s why you went for something more abstract?
Yes, we wanted a name that didn’t mean anything. It could be a blank canvas to build the experience around. We’ve grown 100% year-on-year for the last few years, and we’re in a very strong position now. We’re the number one in the digital space, but we want to be the clear number one in used car finance, not just the digital space. So our ambition exceeded what Car Loan 4U could give us, and Zuto has given a brand we could grow into.
How long had you been thinking about the rebrand?
Ryan and I had talked quite seriously, and quite far back, about the name perhaps being a barrier one day. When we received £8m from Scottish Equity Partners, and then recruited a world-class senior team around us, it was then that we really got into in-depth strategy discussions, and it kept coming back to the fact that we wouldn’t be able to achieve what we wanted with Car Loan 4U.
So I guess it goes back a long while with Ryan and I talking about it, and not doing anything about it, and the timing is now perfect, before we start exponential growth, to get the brand, tone of voice, what we stand for, our purpose, and everything all aligned, before we go on that growth.
What’s happened behind the scenes for the past 18 months?
The main bulk of the work was user research. We’re massive on user testing with all our digital assets anyway, so we spoke to a lot of our customers in their homes, talking about buying a used car and the name, and different names which we had on the table. Zuto was received so well that we chose it.
You get the feeling that it’s A to Z of buying a car, and if you remove the Z and replace it with an A you get auto, and it sounds very much in our space, even though it’s nondescript.
That was the first thing. Obviously, after that, designing the new website was huge. It was built for mobile first, and very much with mobile in mind. Then there was changing all the assets over, and making sure they all went over on one day.
We’re very lucky to have relationships with Auto Trader, What Car?, Gumtree, PistonHeads, these big motoring sites. So one day, at three in the morning, you want to change it all over on these sites. And a lot of these you don’t have control of because they’ve got to change it at their end. That’s a good example of how lining all that up to go smoothly takes a lot of planning to make sure you don’t let the customer down. I think we’ve done a good job, and I’m really happy with the team.
The other thing to say is that going through something like a rebrand is a massive task, along with maintaining 100% growth in the business, and trading, it’s a real credit to the team.
The other thing is Ryan and I are very much ‘test and learn’. And as a result the business has always been very agile and is ‘test and learn’. This means we get the data and then if it works we do it. But for something like this, it couldn’t be like that. So that was a challenge in itself – for myself and Ryan to keep quiet about something for a long time and not being able to just put it online and see what happens.
The other thing to mention with the rebrand is that we’ve trademarked it not only in this country, but in other countries as well. We’ve got about a 3% share in the used car finance market here, and we want to take that to 15-20% before we start looking internationally. But we wanted to get our ducks in a row beforehand, so we’re ready to go.
What were some of the other challenges in the rebrand?
I think one challenge was this wasn’t just a rebrand. The whole strategy, over the past 18 months, has been reassessed. That includes things like our purpose, or beliefs – our how, what and why – have been assessed and slightly changed. I think it’s important to have that strategy in place before you go and lay a rebrand on top. That was another big challenge and we had some really long days at strategy meetings.
How are you going to judge the success of the change in the medium to long term?
I don’t think it’s a six-month thing to assess. This is a long-term move. Like I said, we’re currently the number one in online car finance, but we want to be the clear number one in used car finance full stop, and to be a better way to buy a car for customers. So to judge the success of Zuto will be more long term. It will be so if it becomes a household name, where if someone wants to buy a car they’ll think Zuto.
Also, Car Loan 4U had a great reputation, and so will Zuto, because it’s the same company. But actually we’ve got a greater expectation from a customer point of view. We’ve got a great reputation with a very small percentage of customers, so I think that unprompted awareness of Zuto will be the big measure of the success of it.
Was there a fear that changing identity could undo some of the good from the Car Loan 4U name?
Not at all. The future plans far supersede what we’ve achieved so far. I don’t think there’s an element of having to start again or losing our reputation because we’re a tiny piece of the whole market, and our awareness with end-customers is very low, so I don’t think that was a concern.
You said you’ve got a £15m marketing budget. What are the plans for that money?
We’re a digital brand. We will continue to spend money digitally, but the bulk of that £15m will be going above the line – anything from TV, radio and outdoor. That’s where the bulk of the spend will be going, just to raise awareness of Zuto. The TV advert is coming together, but it’s not ready yet.
You mentioned a change in strategy. Could you spell out what that means?
I wouldn’t say it’s a change; it’s more getting down what you believe and what your purpose is. The point was that we did so much more than finance under Car Loan 4U, with the whole removing of friction from buying a car and really helping customers to make the right decision, and using intuitive technology with an element of human interaction. That’s what Zuto is, and what Car Loan 4U was. But I think Zuto allows us to build the whole experience around that, as opposed to Car Loan 4U where it’s a bit descriptive and you’re just thinking loan straight away, as opposed to ‘this could be a better way to buy a car’.
Is the car loan still going to remain the central pillar of what you do?
Yes, the finance will still be there, and it’s something that will remain there. But what customers find valuable – the loan is almost secondary – is actually all the advice when buying a car. That’s what differentiates us in the market.
What are your next steps?
The next steps for Zuto are exponential growth. We’ve grown quickly at this stage, and we’re about to grow a hell of a lot quicker. Actually, going back to your question about challenges, that is another challenge: getting the business fit to serve the increase in demand. So we’ve done a rebrand, the big strategy piece; we’ve had to keep on trading, and we’ve also done a huge piece across the business getting ready to serve our customers after this growth.
You just opened up an office in Manchester, has that given you enough space to grow your headcount?
We’ve left the contact centre team in Macclesfield, and we’re refurbishing there. We’re taking over the whole building and that will take up to 220 people in Macclesfield. That team will continue to grow in line with Zuto’s growth.
In Macclesfield we’ve recruited some great people, but location is becoming a bit of an issue when we’re getting into the final stages of talks with some really talented people. So we thought if we moved to Manchester it would remove that barrier, and it has done. We’ve got some really good people since the move to Manchester, particularly around technology, marketing and products. We will continue to see that growth.
When we moved into Manchester we took over one floor with the first option on two other floors. We only moved in a couple of months ago, and we’ve already taken the floor above, which is being refurbished as we speak. So we’re really moving into that space. n
