Marketing Strategy Used By Chinese In Order To Attract Major Brands To Promote Their Industry

Summary:

Chinese attracted multinational companies to promote their industry by adopting multi-factors strategies. Chinese made refined policies and gave investors enough space to invest in China’s market. Chinese made innovations like electric cars, etc., to catch the attention of companies like Ford, BMW etc. Chinese promoted the luxury cars in public as well by proper marketing to take the sales high. Luxury cars were promoted using marketing, refined prices etc. Investors were given a lot of benefits and lower taxes with a competition that was acceptable for luxury car brands to come and invest in China. Nowadays, all luxury cars are being made in China, which is a result of the strategies adopted by the Chinese.

Introduction:

China is in the 3rd position in luxury car marketing and is making its routes to get its market on 1st rank in the world. For this, there are many policies made by the government to get the best import and export business and luxury car marketing in China. There are many factors along with the policies by the government by which the competition between luxury car marketing is increasing at a higher speed.

Likewise, in other countries, Chinese women also have a greater percentage who are willing to buy branded things, and according to Maserati’s managing director of Greater China, Bo Yaming, Chinese women account for 40% of its buyers in the Chinese market, which is in stark contrast to the rest of the world, where women account for less than 5% of buyers (Zheng, 2017).

Things like the needs of people are increasing nowadays. Here actually need to point out the factor of balancing the status in society, so the way of living and obviously, everyone wants to drive a luxury car. We can also take this point as a factor, too, yet it is a general one. Above all are the things that are responsible for the rise in luxury car marketing in China, but we will also see what strategies are adopted by the companies to fight back and get 1st rank level in luxury car marketing.

To do this these companies are trying to put some new technological innovation in their new car models. In which they are having electric cars and mainly solar energy working cars, which do not have that much effect, but many companies are trying their best. Tesla is a great company that has introduced its electric car, which is fully auto-drive and works better than a human, and can drive at 160km/hour speed in auto-drive mode. To do that, Mercedes-Benz also launched its car, which is also a drive car, in 2016.

Discussion:

Looking at the luxury car market competition right now in China, we cannot say that all this came of a sudden, and competition got higher. Simply no, because this starts from the time when China was dealing with passenger automobiles, not the luxury one yet. Let’s have a look at the two companies Chery and Dongfeng. Chery and Dongfeng are both government companies, and both of these companies had a hard time developing themselves, but Chery got its power soon and how that’s the beauty. Chery first made its new car models without any foreign company help and came on the front line; this step became a downfall of Dongfeng because the engineers of Dongfeng Company had a vision that if this company got down, so would their future, so they joined Chery Co. and this gives a new way to a different journey. A group of 20 engineers who joined Chery Co. made a new company named “Jia Jing Technology Company.” Which was specialised automotive design company and being with Chery this gave a great start for more Chery development. (Luo, 2005)

Let’s have a look at the competition in the luxury car market journey and how it started or even what the causes for the competition between the companies at such a high level.

• Government Policies:

Government policies have a big role in any industry of a country, but as we are considering the luxury car market so, let’s be on that. Now we can see that there are policies from 2000 till now the Chinese government is trying to encourage car companies to work in China, and the beauty of this encouragement is that companies are getting the prices or profits that they want from selling luxury cars. Now, what are the encouragements by the government?

A simple answer can be that lower the taxes, so this is true. They did, in 2004 China was the 3^rd largest car marketer in the world, and this was because of the reason for government policy of a fixed permit fee on all the imported cars. This encouraged the companies to work in China because they can have their profit, and as we know, the 1st goal of a company is always to have a profit because it’s the first rule to live in the market or else you are dead. This had a very large impact overall because this made many companies increase their working platform in China; companies like Volkswagen, Toyota, Ford, and Mercedes-Benz and many other higher rank companies, especially Maserati and Ferrari as the names are very loved, expanded their market in China.

Again, in 2004, when the government lowered the permit fee on imported cars, this was a huge benefit to the car companies, and there was also an increase in the quota of imported cars (T Phani Madhav; M Dakshi, 2004).

• A large number of car companies:

As we know, wherever there are a small number of competitors, there is small competition between them mostly because if 5-6 companies are working in China so, obviously, they won’t compete because it would be difficult for them too to give efficient and effective marketing. But in our case it’s not the case there is a large number of companies which are working in China so they would have good competition between them because when there are, for example, 20 companies and all of them are selling a 4 seater luxury car, then only the company whose car would have better mileage, beautiful and other things higher than other companies will win the race in the market for that car. Likewise, more are the applicants for a job manager more will be the competition.

• People’s interest in luxury cars:

Now, having a look at the interests of people, according to many case studies and articles on websites, Chinese women tend to spend more money on luxury goods and mainly on luxury cars. “In China, women are more ambitious… so they will buy more ‘high powered’ products than women in the US or Europe,” Tom Doctoroff, a senior partner at brand and marketing consultancy Prophet, told to Forbes, addressing the difference between women in China and the west (Zheng, 2017).

This thing shows the interest of people that they need more luxury cars than their neighbors, etc.

Now, talking about the ‘global comparison revenue, ’ China had US$469,088.0m in revenue from the car market. And that’s the highest revenue. (Statista, 2018)

Appendix A:

This shows how much China is thinking about the car market, and from this, one can acknowledge what kind of competition there is in China in luxury car marketing. The other reason for the luxury car companies to have big competition in China is also considered the interest of China in the car market, which causes the worldwide companies to have large-scale work in China because if they have good market value in China, obviously they would have a good name in the world.

Now let’s have a look at the percentage of production of large cars by some different companies in China. Taking first the Chery Co. which will have amount to 455 t. Pcs. In 2021. (Statista, 2018)

Appendix B:

Going forward, other companies like Ford will have an amount of 784 t. Pcs. In 2021. (Statista, 2018)

Appendix C:

The Geely oldest company in China, making large cars or can be said luxury cars, will produce an amount of 1,102 t. Pcs. In 2021. (Statista, 2018)

Now, from these tables, we can come to the point that the amount of luxury cars produced by different companies in China shows the past competition between companies, current competition and future competition which can be there in China. The scales of large cars in all three graphs show the number of actual luxury cars in China, which increased highly between the years 2013 to 2019. (Statista, 2018)

This is almost the same for many companies working in China, and the production rate is almost increasing to manage and get a place in the luxury car market.

All above we were seeing the factors which are increasing the competition in the luxury car market in China. Now, let’s discuss the strategies made by these companies to hold their position in the luxury car market in China.

Different companies have different strategies to maintain their place in the luxury car market of China. But all of the companies are somehow doing the similar ways too because like efficiency and effectivity of product is the main goal of almost every organization or company. These strategies in general and company wise will be our subject now.

In this diagram, we can see the way a brand, in general, what does to maintain its place in the market. Let’s stick ourselves just to two points for a while: brand awareness and brand attitude. These are the two factors that are associated because of which a company gets its value raised mainly. The more awareness a brand will have in the area more its number of customers and talking about brand attitude itself, which plays a big role in maintaining the status of its customers in the society. That’s the most beautiful thing and is the best way to get your company on the scale.

We are going to discuss the major luxury car companies’ strategies here. Now the thing is that, taking the example of Mercedes-Benz, which has a big name, and has big strategies as well to maintain its place in the market. Strengthening core business, leading in technology, pushing digitization and growing itself globally.

A big step during advertisement is taken by the actual company to convince the supermodels of movies and other characters which are very famous among the people in their advertisement so they will have more trust in their liked models, and so obviously trust will also be made on the car company. So this is how the luxury car companies are trying to make their rank 1st in the luxury car market in China.

Now considering, another thing that companies do to come on the front line is making themselves global means to say that they are trying to export their goods out of China too, so making a view in people’s minds that this company has something great in it, that’s why its products are accepted globally. Lifetime guarantee and ten-year guarantee, etc. Such terms and policies are being used by companies to overcome the problems.

Methodology:

Introduction

Research Methodology is a rule to choose the fitting exploration theory that will be more reasonable for your report. This caused us to choose the best way of research approach for accomplishing the exploration destinations; all the while this likewise encouraged us to finish the report work inside the time zone given for fruition.

Realism

The researcher should be realistic. His research should be based on facts of the current era. His narrative should be realistic and clear.

Research Approach

There are two types of research approaches after deciding the paradigm of the report. We have selected Realism as our strategy. Following are the types of approaches that we can use for this purpose.

• Inductive Approach
• Deductive Approach

Research Strategy: Selected for this Research

Based on the current topic we have chosen an inductive approach, and we remained subjective and factual. Realism was approached, and the real facts, which are the results of general public thoughts, were considered. Many of the facts were from public view. Biased information was avoided and the research conducted is based on the statistics of the leading bureaus. We followed the top leading sites when we needed stats.

Data Collection and Analysis Methods for this research

Facts were taken from different websites where polling is done by people. The root of the problem was targeted, and many of the facts were taken into view which were in favor or against it.

Conclusions:

China, being the highest revenue holder in car marketing, has a high rise in the luxury car competition. And reasons for this competition are the high demand for luxury cars in China and the best policies of the government in which they have lowered the import taxes and increased the import quota of luxury cars, because of which every car company is trying to increase its production rate and import in China and giving the best and new of its best car models so people can have the good cars and companies obviously can get profit. Many strategies are being adopted by the companies in which their advertisement, awareness and innovative technologies are playing main roles. Chinese markets are a bird’s eye view for the investors, and they are the most suitable ones to invest.

After all of this, we can say that the Chinese luxury car market has good management, and its results can be seen in the Global Comparison Revenue, which shows the 1st rank of China, and one cannot say that there are any major management issues in this sector of China trade.

Recommendations:

China is the world’s leading economy, and if China continues to improve its auto policy, it will become the world’s largest automobile exporter. Moreover, China needs to look at the quality of products for exports. Developing countries should adopt the same strategies China adopted to promote their automobile industry.

Glossary:

Multinational: A multinational corporation (MNC) has facilities and other assets in at least one country other than its home country.

Paradigm: Pattern or model

Digitization: Used as a metaphor for describing the growth of the economy.

Strategy: a plan of action designed to achieve a long-term or overall aim

Innovation: a new method, idea, product, etc.

Polling: record the opinion or vote of.

Biased: unfairly prejudiced for or against someone or something

Realism: the attitude or practice of accepting a situation as it is and being prepared to deal with it accordingly

Appendix:

Appendix A: Global comparison revenue’ China had US$469,088.0m revenue from car market. And that’s the highest revenue.

Appendix B: Percentage of production of large cars by some different companies in China.

Appendix C: Geely oldest company in China, making large cars or luxury cars, will produce an amount of 1,102 t. Pcs. In 2021.

Bibliography:

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