Cadillac’s China Ambitions May Lure Younger Crowd
Only 27,073 Cadillacs were sold in China in the first 11 months of 2011, compared with 370,559 Audis. Photographer: Lintao Zhang/Getty Images
While General Motors (GM) stands as the largest foreign automaker in China, selling over 251,800 vehicles in October and more than 260,000 in November, the Detroit-based company remains unsatisfied as it faces sustained, fierce competition from German luxury automakers such as Audi. To remain competitive in the upmarket sector — its weakest point — GM recently announced plans to increase the number of Cadillac dealerships in the country by about 25 percent, the beginning of a global campaign to publicize its higher-end offerings.
According to Businessweek, GM's China President Bob Socia said in a recent interview that GM will add about 40 Cadillac dealers next year to its current 160. GM also hopes to add a new Cadillac model annually in China through 2016. As Socia put it, "We've struggled in the past, there's been a new commitment so to speak, from General Motors about what we want to do with the Cadillac brand. It's a journey, you're not going to do this in a year or two, but you've got to come up with product that unequivocally can compete."
However, GM may be getting ahead of itself, as the brand still has a full plate of marketing strategies to consider. First, as Jing Daily noted last month, Cadillac's bold and edgy design aesthetic has been a harder sell in China to date, as the country's older car-buyers have tended to stick to more rounded, elongated designs. However, it is possible that Cadillac's greatest potential for success in China could come by targeting younger buyers from China's "post-80s" generation.
While it may seem that Cadillac's China expansion plan is aimed at converting an older, wealthier crowd away from their beloved black Audis, it looks entirely plausible that the automaker is targeting a very different consumer. Specifically, the company's savvy use of social media, including experimenting with the emerging and wildly popular WeChat on its "Discover Route 66″ campaign, may open doors to post-80s well-to-dos. The company's digital marketing efforts have been largely successful over the past year, with its Weibo fans increasing 132 percent year-on-year to over 850,000, according to the latest L2 Digital IQ Index. Heavily used by China's plugged-in 20- and 30-something white-collar demographics, platforms like Weibo and WeChat are able to connect Cadillac with buyers who aren't necessarily looking for the designs preferred by middle-aged consumers, but rather a more aggressive and active aesthetic.
This 25-35-year-old buyer base, often several years into their career, is at the age now when many are looking to move up the value chain for their second or third vehicle. Rather than taking on (often German-brand-loyal) older buyers, American carmakers like Cadillac have an opportunity to appeal directly to the post-80s driver who's more open to suggestion when it comes to auto brand. While it's a bit of a stretch to assume Cadillac will focus single-mindedly on a younger Chinese consumer and position itself as a mid-range luxury brand for the urban white-collar worker, it's probably a smart move for the brand to take a cue from fellow American brands Tiffany & Co. and Coach and work to occupy the accessible luxury segment rather than aiming at the ultra-luxury consumer.
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