Auto cos look at maverick solutions to beat slowdown

Chennai: With sales hitting a slump, auto companies are being pushed to think up innovative marketing and sales solutions to improve volumes.

Motorcycle brand Royal Enfield, for example, is investing in the compact store concept in hinterland markets which will require less investment from dealers and therefore will break even faster. Luxury car maker Mercedes Benz for its part is launching its wishbox financial package which will offer customised options to attract buyers including a 4-year EMI alternative which can be used to buy two Mercedes Benz models for the price of one. Othersincluding Nissan and M&M are offering subscription and personal lease as an alternative to traditional car financing. Two wheeler companies like Hero Motocorp, TVS and Bajaj are offering lower interest loans through their captive financing arms with some markets getting zero interest financing.

Auto marketers say the usual brand building and discounting are no longer enough to pull in customers, even for luxury vehicles. Take Mercedes Benz India. The luxe car company is rolling out its Wishbox initiative including options like the ‘Key to Key change’ which allows customers to own two Mercedes-Benz cars in a span of 4 years. Applicable on GLE and GLS SUVs and the S-Class, this offer allows two upgrades at no extra cost. “We are introducing some mobility solutions with the aim of bringing the much needed customer confidence back, by offering them financial flexibility,” said Martin Schwenk, MD & CEO, Mercedes-Benz India. The company is also offering its BS6 products earlier than the deadline to allow customers to transition faster. “Till date we are already at a 60% plus transition level and by September 2019 we will be at 80% level,” said Schwenk.

At Nissan, the new mantra is precision marketing. “At Nissan we believe that precision marketing is the way to tap into what customers want and targeting the right customer at the right time with the right medium.” What that means is the complete experience of choosing and owning the car “will undergo a transformation through Nissan’s Intelligent ownership platform,” said Sriram Padmanabhan, VP-marketing, Nissan Motor India. Leasing is part of this package, “a financial solution which addresses a part of the ownership hassle i.e. no down-payment,” he added.

Nissan is bringing a “complete ownership solution by allowing customers to subscribe to a KICKS with a minimum lock in period,” said Padmanabhan.

Of course, financing isn’t the only area where auto companies are looking to innovate. Cult bike brand Royal Enfield, for instance, is going in for micro-retail to push sales in smaller, hinterland markets. “We call them Studio Stores and they are 500-600 sq ft showrooms in upcountry markets owned by our existing dealers.

“Since the investment requires is very small – Rs 5-Rs 6 lakh – they will recoup them quickly, bringing additional volumes to us,” said Siddhartha Lal, MD, Eicher Motors. The company plans to put up 500 such stores by the end of this quarter.