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Strategies & Market Trends : China Warehouse- More Than Crockery -- Ignore unavailable to you. Want to Upgrade?

To: RealMuLan who wrote (1681)	12/4/2003 12:58:39 PM
From: RealMuLan	Read Replies (1) \| Respond to of 6370

Branding Cars In China The McKinsey Quarterly, 12.03.03, 1:00 PM ET Although local brands of compact cars such as Xiali and Geely still sell well in China, some foreign marques have built themselves strong brand perceptions in the market, as evidenced by the way consumers perceive their performance on key brand attributes. The Volkswagen Polo, for example, outperforms most competitors on ten of the top 20 attributes, such as industry leadership and the ability to make the buyer appear to be successful. Other foreign brands, such as the General Motors (nyse: GM - news - people ) Sail and the Toyota (nyse: TM - news - people ) Vios, excel on average in four such attributes, while Chinese brands are not competitive. Chinese consumers in all market segments are price sensitive, however, which is where foreign brands face challenges. Consumers who consider buying a Xiali are three times more likely to get one than those who consider buying a Polo. And in McKinsey's purchase funnel analysis, price was identified as one of the top five bottlenecks in converting consumers from people who consider purchasing new cars into people who actually purchase them. On the other hand, a manufacturer that lowers prices risks losing some intangible attributes linked to status. Setting a price that captures sufficient market share without cheapening the brand image presents a hurdle for both existing automakers and new entrants. The good news for the automakers currently on the threshold of entering this market is that although brand preferences are in the process of developing, loyalties have yet to be formed. Fewer than 12% of compact-car buyers in China say that they would buy the same model again, as compared with 50% of such buyers in Japan (Exhibit 2), though the Chinese figure is largely attributable to consumers who plan to trade up to larger cars. How then can new entrants and existing players capture customer loyalty? First, Chinese car buyers have strong emotional preferences, are extremely brand conscious, and place great importance on industry leadership. Therefore, automakers must develop and maintain strong emotional and intangible associations between their brands and the customer not only on the level of individual models but also on the corporate, or umbrella, brand level. Depending on the segment that automakers target, they can select from a range of key intangible attributes, such as popularity, trendiness, and an air of success. Second, automakers should build their frontline sales capabilities. Some 80% of Chinese buyers are in the market for the first time, and they shop around to a much greater extent than buyers in more mature car markets. Salespeople who educate consumers to make them feel comfortable with this unfamiliar purchase are more likely to build strong relationships and to promote repeat purchases. Excerpted from The McKinsey Quarterly forbes.com

To: RealMuLan who wrote (1681)	12/5/2003 12:54:09 PM
From: Ann Corrigan	Read Replies (1) \| Respond to of 6370

China is an enemy of FAIR trade. However, not for much longer....the majority of Americans have finally woken up to the Walmart/China axis of weasels phenomenon. Start improving workers salaries, working conditions & we'll see how long items can be produced for pennies. Gravy train is about to drastically slow down for the American China-investor traitors.