Unique Game Plan to Complement Customer MentalitiesTue, 09/01/2015 - 12:44
Q: What are the distinguishing factors of Hyundai’s current strategy in Mexico?
A: After the growth we have witnessed in Mexico and the US over the last 15 years, we felt it was time to recapture our image with the customers, so we are now working on redesigning our dealerships. We are implementing a clean approach and want to convey a premium feeling to customers with a design inspired by nature, so we are adding a lot of green areas in the showrooms, which shows that we are a company that cares about the environment. Currently we have 31 dealerships in the country, including the one we recently opened in Chihuahua. During 2015, we have been trying to establish nine more showrooms, half of which are under construction, and we have already decided on the location of the rest. Hyundai expects sales of 20,000 units this year, but we recently changed our target to 22,000 because of the positive results we had obtained in the first five months.
Last year, we had a goal of 8,000 sold vehicles, but we were able to reach 12,000. We were extremely pleased to realize that by the end of the year Hyundai dealerships were the most visited stores in the country. We had an average of 50 visits per day in certain showrooms, which is a considerable difference from the usual 12 in the country. The company underestimated the awareness that Mexico had of Hyundai. However, we found that our customers were truly loyal, and were already waiting for us.
Q: What is the average age of Hyundai customers and how is the company planning to expand its client base?
A: Our global average is 35 years, younger than the rest of the market and slightly more oriented to the male segment. During the first few months after our inauguration in Mexico, we focused on attracting our existing client base and, since then, we have continuously attempted to favor these customers. We offered a MX$5,000 (US$330) discount to previous Hyundai owners to preserve their loyalty, and we continuously deliver a five year bumper-tobumper warranty with road assistance available in the US and Canada, which no other volume brand provides.
This year we are launching a new project called “Before the Service” to offer a free inspection to all our customers before every vacation period. The message we are trying to send is that we are not here only to sell cars, but we also care for our customers. Clients generally decide on a product based on two approaches: rational and emotional. At Hyundai, we have worked really hard to offer all the necessary solutions to appeal to the rational part of the customer, and now we have to appeal to the emotional side with truly attractive products.
Q: How have Hyundai’s different models been received in the Mexican market?
A: Elantra had a significant market share in the compact segment. Compact cars took a hit last year given the changes in the tax reform, making them no longer deductible. However, we had a competitive product, it was well accepted, and we are confident that it will be one of the pillars of our future strategy. The ix35 was very successful and our customers really appreciated the size of this SUV. Furthermore, the price point was well-received, considering that the trim with the highest price represented 70% of the model’s sales. For the Grand i10 we do not have a clear market yet, but it was a really popular model given our former experience in this segment. We started selling the Sonata in late October 2014 and our sales have increased month after month. This is the segment where we are least known, but we are really pleased with the growth we have seen. In seven months we have sold 879 units, and customers are now comparing us with brands that have been in this segment for a much longer time.
Q: How much is Hyundai pushing its financial services in Mexico and how much of your fleet has been covered with this service?
A: In 2014, we reached about 50% of our clients with Hyundai Finance, powered by Bancomer. We are now looking at continued growth of these services, as they have performed much better than expected. It is important for Hyundai to promote its own financing arm, as we think it offers many advantages and provides us with a much more comprehensive client database. We are in the process of transferring our financial services to the used vehicle segment, but in order to strengthen this segment we need to ease the used vehicle purchasing process.