Automakers look to the internet in China

19 May 2010

BEIJING: Many automakers are making increased use of the internet as they seek to engage with consumers in China.

Ford, the US multinational, employed a range of interactive tools when introducing its updated Fiesta in the world's most populous nation last year, as part of a campaign developed by Wunderman China.

"We're seeing digital media increasingly used to build awareness as well, particularly in social media," Bryce Whitwam, general manager of Wunderman China, said.

One factor behind this trend is that more customers are conducting in-depth research on the web before even setting foot inside showrooms.

"Most dealers in China report a 30% drop in test drives and that is in part due to the importance of online in product purchase," Whitwam said.

"Nowadays, more and more people literally walk right into the dealer and buy the car - the result of knowing exactly what they want."

DDB China, which is part of Omnicom Group, won the account for Shanghai Volkswagen's Passat in late 2009, and also currently handles duties for its Tiguan and Lavida models.

"Particularly in China, with over 320 million netizens, digital has become a must-win battle ground for car brands,” Jesse Lin, managing director of DDB China, argued.

"We are witnessing a dramatic growth in digital spending, from the previous 1–2% of total budgets, to 12–15%."

Nielsen, the media monitoring specialist, estimated that automotive companies spent 630 million yuan on internet display ads in China during the first quarter of 2010.

"The key point is that people are using the internet at all stages of the purchase decision making process," said Georgia Zhuang, a director at Nielsen China.

"TV commercials and magazines are complementary but aren't involved in the decision making cycle."

Having an online presence can also be crucial in stimulating word of mouth, in a market where recommendations from trusted sources have been found to exert an important influence.

“The majority of consumers are first-time buyers and they would rather trust their colleagues and friends than the dealerships,” Zhuang continued.

Fareeda Cassumbhoy, national planning director at Bates 141 China, added that this "third generation" of younger shoppers has unique needs.

Among this audience, cars are "no longer a mode of transport, but about fulfilment, and increasingly seen as an extension of the owner's personality, said Cassumbhoy.

Bates141 produced a viral video to promote Buick's Regal Turbo in China, and this clip went on to receive 17 million hits in its first ten days.

The agency has also utilised experiential initiatives like the S-Curve Challenge, a race covering 20 cities, to generate buzz in both traditional and new media.

Elsewhere, BMW has formed its own dedicated web community in China, while other manufacturers have sought to participate in popular forums like Xcar and Autohome.

CIC, the WOM tracking firm, follows 450 models and 13 million online conversations in China each month to find out which brands are being talked about.

Based on this data, it reported that Shanghai General Motors held a 16.8% share of voice from December 2009 to February 2010.

First Automobile Works Volkswagen, a joint venture between Volkwagen and a domestic partner, posted a score of 16% on this measure, with its sister company Shanghai Volkswagen on 12.8%.

Domestic automaker Chery followed on 10.5%, with Dongfeng Peugeot Citroen on 9.8% and Chang'an Ford Mazda on 9.4%.

Data sourced from Media Asia; additional content by Warc staff