The German oil and additive specialist LIQUI MOLY is pursuing a highly countercyclical strategy in times of Covid-19: Increasing investment instead of cutting spending. Sebastian Zelger, CEO of LIQUI MOLY USA/Canada, explains why this strategy is so successful.
LIQUI MOLY is increasing its investments in marketing and personnel in times of COVID-19. How does this fit together?
We are not doing this despite COVID-19, but because of Covid-19. To get through difficult times safely, you ultimately need more power and effort than when the sun shines. Of course, you can also hide away when a storm rises. But then you no longer have your fate in your own hands. We prefer to roll up our sleeves and tackle the task.
So the recipe for success is that simple?
Basically, yes. Of course, a company also needs the economic backbone to be able to set such a course and survive. Here at LIQUI MOLY, we have the advantage of standing on firm ground and having made provisions. In a crisis, accelerating instead of stepping on the brakes also has a psychological component that should not be underestimated, including on the company’s own employees. If you don’t have to fear for your job, but on the contrary can now show what you’ve got, you’ll act very differently. Our customers have also noticed this.
How is LIQUI MOLY getting through the crisis with this approach?
Very well. We will probably not achieve our original targets for this year. But we are increasing our turnover compared to the previous year – despite the fact that people are driving between 30 and 40 percent less. In other words: We have gained strongly in market share. This puts us in a very good position once COVID-19 is over.
In what way?
It’s very simple: When competitors make themselves scarce, are very hard to reach, reduce their service and can’t deliver goods, it is easy for us to convince jobbers, workshops and car owners to come to us.
Were there no problems?
Yes, of course, quite a lot. Just one example: We traditionally maintain very close contact with our customers, visit them, offer on-site training and organize many events. If a large part of the work is based on personal contact, a lockdown will first pull the rug out from under your feet. However, it didn’t take long and we offered the schooling in the form of video conferences, for example. This worked very well and our customers were grateful to be able to use the lockdown for courses. In fact, we rarely had as intensive and in-depth training as in recent months. Our customers had the time and were happy to refresh their knowledge. It is important that you do not surrender to problems, but try to solve them.
What happens next with LIQUI MOLY?
We have become known as a German brand with our premium products in the import car segment. But we also offer many oils and additives for domestic cars. This is a promising area that we will tackle more strongly.