“Risk is part of the job”: Rolls-Royce CEO reveals its dark side

There aren’t many brands with an allure quite like Rolls-Royce, the well-known luxury marque that’s shrouded in mystery and only accessible to an elite few.

It has stood the test of time for more than 114 years and ridden the ebb and flow of the marketplace with apparent ease. But even heritage brands need to be revitalised every now and then and, luckily for Rolls-Royce, there’s one man who’s willing to take it to bold new places.

CEO Torsten Müller-Ötvös is something of a risk-taker. He’s adamant that Rolls-Royce can’t rest on its laurels if it wants to remain successful in the future. “You need to be reinventing yourself regularly,” he explains.

“If you’re not prepared to do that, you’re gone, finished. You need to be prepared to learn daily and to think differently and to say, ‘Maybe this was right yesterday, but maybe it isn’t right tomorrow.’”

He’s the type of leader who practises what he preaches, too. Since being appointed to the position in April 2010, he has led the company on an exciting – and often risky – rejuvenation, and it’s been paying dividends.

“We have grown massively over the past few years in comparison to where we used to be,” he shares. “We have quadrupled in volume.”

The biggest focus of this rejuvenation has been recognising, and capitalising on, a significant demographic change within its core consumer.

“You need to be reinventing yourself regularly. If you’re not prepared to do that, you’re gone, finished,” – Torsten Müller-Ötvös

Over the past decade the average age of the Rolls-Royce buyer has dropped considerably, becoming an important indicator of the direction the company needs to take.

“When I joined Rolls-Royce the average age of a client was 56, now that has dropped down to 43. It’s a remarkable development,” Torsten says. “With this new average it means that for everyone who is 60 years old, there is at least one person who is 30.

“The background of this is that our clients – the ultra-high-net-worth and high-net-worth individuals – are getting younger and younger. This is due to the fact that it’s much easier to earn money today at an earlier stage in life than it used to be. These changing demographics are influencing how we shape our progress strategy, communicate our brand and appear in public when we talk about Rolls-Royce.”

To cater to this young, cashed-up consumer, Torsten has had to change the way Rolls-Royce markets itself. “Our clients today are more casual and easygoing, and they see luxury in a very different way – it’s not as formal as it used to be,” he says.

“This is a remarkable difference from where we were nine years ago. The imagery, the visuals, the whole look and feel of the brand – everything has changed quite dramatically. We’ve become very active on social media and we put on what I would call ‘money can’t buy’ events.”

Torsten adds that Rolls-Royce has become “a little bit more adventurous” in its approach, taking calculated, yet sometimes risky, moves. The introduction of the Black Badge – a “darker, more menacing side of the brand” – is its boldest move to date.

“Risk is part of the job when you’re a CEO. You need to take risks from time to time,” – Torsten Müller-Ötvös

Black Badge targets a younger, select clientele who can’t be easily categorised.

These consumers want bespoke luxury and high performance without any constraints. Black Badge is available with the Wraith, Ghost and Dawn models and is described as “the ‘alter egos’ of the standard models: darker, edgier, with more power and torque and enhanced driving dynamics to open up the Rolls-Royce brand to new audiences”, the Rolls-Royce website claims.

“It’s something nobody would have expected from us 10 or 15 years ago,” Torsten says. “Back then it might have even been seen as shocking, but it was the right time to do it. There were some who said, ‘Wow, that’s probably a little bit too risky, that might overstretch the brand or it might even scare away existing clients’, but it didn’t happen. Brand-wise, it’s probably the riskiest thing we’ve done.”

New product launches have also been an important part of the brand rejuvenation. A car designed for daily use, Cullinan was released last year to multifarious receptions as it was a marked change to what a Rolls normally represents.

“The imagery, the visuals, the whole look and feel of the brand – everything has changed quite dramatically,” – Torsten Müller-Ötvös

“We’ve never used a word like ‘practical’ to describe a Rolls-Royce before but that’s how you would describe the Cullinan,” Torsten explains. “It’s an SUV that’s super flexible and caters to all your needs. You can bring your friends along, put your dogs in it, go skiing, do your hobbies, take it for a school run – whatever you want to do, this is the car for it.”

The gamble has paid off with strong interest from buyers. “In the beginning, this type of car was never embedded in the history of the brand so it was quite a risky decision, but I would not be surprised to see this car being close to 50% of our total volume this year,” Torsten says.

“Risk is part of the job when you’re a CEO,” he continues. “You need to take risks from time to time and you need to move brands from time to time, even in a radical way, to stay alive and not die in age or history. This is how you stay in tune with your target market and your clients.”

This philosophy of not being satisfied with the status quo extends to Torsten’s personal journey too. “Even as a person, I’m convinced that you need to reinvent yourself regularly,” he notes.

“I’m a keen reader of books and I would also call myself a passionate fly fisher. To do something completely different from what I regularly do, to switch off, to go into nature and just be there opens my mind. That’s important to me.”

#RollsRoyce #RollsRoycePhantom

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