1、Expanding current product/service portfolioRead the reportIts the most optimal strategy for Volkswagen Phaeton to expand current product and service portfolio from the following perspectives.23Content14Potential ChallengesOptimal StrategyPhaeton ProfileChina Luxury Car Market lChina will become the
2、worlds largest premium car market lMain distribution province of luxury brandlDivisions of Chinese luxury car usersContent1China Luxury Car Market lDistribution of brand attention in luxury car marketlKey buying factors what truly matters?4/21Number of urban households by annual disposable income br
3、acket Million householdsSOURCE:McKinsey Insights China Macroeconomic model update(2012);Canback DangelChina Luxury Car Market 1China will become the worlds largest premium car market Global premium car sales ranking,thousand unitsPerhaps as early as 2016,China will overtake the United States as the
4、worlds largest market for premium cars.By 2020,there will be 23 million affluent urban households in China 7%of the population and roughly equal to the total number of households in Great Britain today.海南黑龙江吉林辽宁河北山东福建江西安徽湖北湖南广东广西上海河南山西内蒙古陕西宁夏甘肃青海四川贵州云南西藏新疆江苏浙江北京台湾(Sales proportion of nationwide)5/21
5、SOURCE:McKinsey Insights China Macroeconomic model update(2012);Canback DangelChina Luxury Car Market 1Beijing,Shanghai,ZhejiangOver 10%:Guangdong,Jiangsu,SichuanInner Mongolia,Shandong,Hebei,Liaoning,Fujian.5%-10%:2%-5%Main distribution province of luxury brand6/213Mainly Male(30-39).Attention on o
6、rgin and property.High percentage of women(25-35).Care about luxurious figure and cost performance most.Successful business owners or senior executive(35-45).Attention on social identity and comfort.Mainly Male(30-39).Willing to try the advanced features and technology.30-39.Emphasis on representing
7、 personal identity and image.Chinese luxury car users are divided into five groupsSOURCE:DAXUE Consulting 2013 Luxury Car Market Research of ChinaChina Luxury Car Market 3China Luxury Car Market 7/21SOURCE:DAXUE Consulting 2013 Luxury Car Market Research of ChinaMultinationals dominate Chinas premiu
8、m car market,with German automakers(e.g.Audi,BMW,Mercedes,and the Volkswagen Group premium cars)accounting for 80 percent of market share;other European,Japanese,and US brands make up the remainder.However,competition is heating up,putting pressure on profit margins.Distribution of brand attention i
9、n luxury car market(May,2013)3China Luxury Car Market 8/21SOURCE:McKinsey Insights China Macroeconomic model update(2012);Canback DangellOrigin of PhaetonlDevelopment of PhaetonlSales of Phaeton and its main competitorsContent2Optimal strategy10/21The Volkswagen Phaeton,launched in 2002,is a full-si
10、ze luxury sedan manufactured by German automaker Volkswagen,described by Volkswagen as their premium class vehicle,aspirating to compete on the level of its premium German counterparts in the luxury market likes of the Mercedes-Benz S-class,the BMW 7-series,and its VW Group siblings,the Audi A8 and
11、Bentley GT Coupe.3Phaeton profileOriginThe whole manufacturing procedure focus on sedans quality.It is the devotion to detail that makes a work of art and masterpiece.In the transparent factory,where Phaetons are assembled,passion,craftsmanship and precision are channeled into motor cars.Buyers will
12、 have an unforgettable experience enjoying the handcrafting interior and luxury design derived from German.The Volkswagen Phaeton was a technological marvel with top configurations when it was exported to the United States.Sales fell short of expectations.The sales in America saw a short increase,bu
13、t plunged to only 235 in 2006.So that,at the end of the 2006,Phaeton was pulled from the United States.3Phaeton profileDevelopmentSource:Annual Report of Volkswagen 11/21In contrast to how the Phaeton performed in the U.S.,the sedan captured the attention of buyers in foreign markets,particularly As
14、ia,with much success coming in South Korea.In recent years,Korea has been surpassed by China as the Phaetons biggest sales market outside of Germany.3Phaeton profileHigh demand for the Volkswagen Phaeton in China has given new optimism for its successor.In 2009,Chinese deliveries of the Phaeton worl
15、dwide rose to 40%.Volkswagen successfully increased that figure to 3741 vehicles in 2010,a 158%gain,making China the biggest market for Phaeton.In 2012,the number of deliveries in China is 10000.With excellent performance in the serial years,China is now the chief market for Phaeton.The new Phaeton
16、was presented in 2010 Beijing International Automotive Exhibition.And selecting China as the venue for the launch of the new Phaeton proves VWs commitment to this vast market.Phaeton is still far behind from its competitors in sales,although it has outstanding market performance in China.12/213Optim
17、al StrategylEnrich China-specific product portfolio lPersonalized services in Phaeton Customization CenterlPhaeton Exclusive Lounge in the most understated wayContentsmaller enginesOptimal Strategy314/21offer China-specific car models at appropriate prices-considerably less than the Mercedes-Benz S-
18、Class and BMW 7 Series-lowering the entrance level of premium cars to embrace“new mainstream”consumers.To follow the trend of stricter control on fuel efficiency and stronger awareness of environmental protection.For example,VW Phaeton could ditch the thirsty V-8 and W-12 engines used previously,and
19、 use a range of turbocharged 4-cylinder and V-6 engines,couple to an 8-speed automatic transmission for production.A plug-in hybrid model could also join the range at some point.Enrich China-specific product portfolio with.The older generation of premium car owners purchased vehicles mainly to refle
20、ct their social status,but the increasingly sophisticated new generation of buyers is expressing their youthful vigor for buying premium autos.For example,the slab-sided and forgettable 3-box shape of the original Phaeton may give way to fender curves,a long and flowing roofline,and steeply raked re
21、ar glass.for Volkswagen Phaeton to expanding current product and service portfolio from the following perspectives.1more attractive design2014 case competition we are acumen from SJTUOptimal Strategy315/21personalized services in Phaeton Customization Center.for Volkswagen Phaeton to expanding curre
22、nt product and service portfolio from the following perspectives.2the phasing of individual assembly procedures makes production sector into stages such as engine fitting and window fitting.It is on these stages that the vehicles to be assembled are placed by lifters which feature a large selection
23、of setting options.customers can choose from a variety of different configurations,p r o v i d i n g t h e m t h e m o s t appropriate product according to their personalities and demands,which will be a first-mover advantage for VW Phaeton in the upscale segment.Because VW Phaeton will be the first
24、 one who introduces customized services into the production of cars millions valued,while it is only adopted in cars with tens million price now.2014 case competition we are acumen from SJTUOptimal Strategy316/21Phaeton Exclusive Lounge-approaching,caring for,respecting customersfor Volkswagen Phaet
25、on to expanding current product and service portfolio from the following perspectives.3Builds the”premium personality”or brand DNA,reflects the owners sense of individuality and emotional needs and gets win in the battle for premium car market share.Provides the Phaeton owners a private club to ling
26、er on the overall premium ambiance,soak in the very personalized lounge atmosphere,savor the details under-scoring the build quality,f e e l t h e p u l s e o f innovation,and immerse themselves in a world of exclusivity.Encourages customers to bring their entire entourage to the lounge and they wil
27、l be treated to a unique experience of one-o n-o n e s e r v i c e,w h i l e consumers in lower-tier cities seek social acceptance.2014 case competition we are acumen from SJTUlRivalry competitionlCustomers choices and influence of the brand imageContent4Potential ChallengeslOrdinary and conservativ
28、e design of its appearance fails to attract its target groupPotential Challenges418/21of expanding the product and service portfolio:Faces intense competition with car manufacturers targeting elite customer segments hence limited market share.The Customized Service，which Volkswagen Phaeton is featur
29、ing in China market,Nowadays,is being attached importance to by other German prestige market leaders,Mercedes-Benz and BMW.2014 case competition we are acumen from SJTU1Rivalry competitionPotential Challenges419/21of expanding the product and service portfolio:Volkswagen underestimated the weakness
30、of their brand in the luxury segment.Reality of the luxury car market is the fact that luxury car customers are quite a conservative bunch and they are usually the last to embrace new brands.Furthermore,it was difficult for customers to transfer their beliefs about Volkswagen cars to the Phaeton as
31、the luxury Phaeton n o t s e e m e d t o b e a p r o p e r Volkswagen car.2Customerschoices and influence of the brand image:2014 case competition we are acumen from SJTUPotential Challenges420/212014 case competition we are acumen from SJTUof expanding the product and service portfolio:Ordinary and
32、 conservative design of its appearance fails to attract its target group:3 Phaetons target group is Young executives.VW released Phaeton to express the idea of using the conservative appearance to attract those who worked hard to earn wealth and wanted a luxury car that would be functional,not too f
33、lashy and that represented value for the money.However,the market reflections showed that young executives and businessmen didnt show much appreciation for this idea.Therefore,this design style needs transformation.ContentTHANKSWe are ACUMEN from SJTUCheng Yu Wu Hong Pan QianqianGeng ZhengCustomizationBackground成功之处背 景背 景成功之处BBackgroundB背 景成功之处背 景背 景
