BMW opens brand centre to provide quality service
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E-mail Shanghai Daily, April 19, 2013
Mr. Karsten Engel, the new president and CEO of BMW Group Region China, has recently prioritized four tasks for the company under his agenda.
"Looking forward, we are fully confident we will continue BMW Group's success story in China in 2013. Our targets are clear: double-digit growth in sales volume, outgrowing the premium segment and winning more market share; leading the segment in the quality of sales and after-sales service; remaining the most desirable and respected brand; and having healthy profitability for our dealer partners," Engel said at a press conference in Shanghai on Monday.
The message he sent out is loud and clear: in the future, BMW will bring not only exciting products, but also thoughtful services to its largest single market in the world.
On the very same day, Engel unveiled the first BMW Brand Experience Centre worldwide in the city, which is part of the BMW "Future Retail" program to improve customer experience.
Taking the form of a two-storey "crystal box," the BMW Brand Experience Centre located beside the China Art Museum in Pudong New Area is where anyone can feel free to explore the JOY of BMW through sophisticated, high-tech product presentation.
There are no pushy salesmen but only helpful digital concierge "Product Geniuses" equipped with advanced gadgets, who can introduce to visitors about BMW history and culture, details of the exhibited models such as the classic BMW 501, the BMW Art Cars and the latest BMW i3, and the rarely-known stories behind these cars.
The whole point of introducing the role of "Product Geniuses" is to make product knowledge more interesting and more accessible to consumers so that salesmen can concentrate on cutting the deals, explained Engel. "The Future Retail program is not a one-shot experiment but a comprehensive program which will integrate into our business model in future."
Soon, the MINI Brand Experience Centre will open on the other side of the China Art Museum, together with BMW Brand Experience Centre, the three building structures will define an architectural triangle. In addition, more brand experience centres will open to the Chinese public in coming years, and "Product Geniuses" will greet customers at every BMW store in the country. Spending his first nine years at BMW developing sales network in emerging high-growth markets like southeast Asia, Engel is well aware of how the development of dealerships and that of car brands come closely together.
By the end of the first quarter, running 370 service outlets in the country, the most among all upscale market players, BMW saw the quarterly sales of its namesake brand and MINI rise 7 percent and 10 percent respectively, outperforming the 4 percent expansion of the premium segment.
Untapped consumption
To continue such a strong momentum of growth, BMW will need to keep extending its presence in lower-tier cities with huge untapped consumption potential, Engel said.
"There are many smaller cities in China with a population of more than 1 million and without premium car dealers," said Engel. "We are usually the first one to go there to serve the local customers. The latest example is our newly-opened 4S dealer in Liyang City in east China's Jiangsu Province."
And this year, it won't be just about selling new cars as the company plans to step up the role of after-sales in its business.
"The car park of BMW and MINI in China exceeded 1 million last year and is likely to double within three years," said Engel. It means "hundreds of thousands of cars will have to come to our workshops in a couple of years, generating substantial growth in after-sales business," and as a process effect, used car trading and consumer financing service will also boom.
Last year, sales at BMW's authorized used car dealerships in China amounted to more than 15,000 units, and financing program benefited 30 percent BMW customers, it was a big improvement compared with the 20 percent a year earlier.
"As has been proven in other mature markets, stable after-sales revenues will make our business healthier, more resilient, and more able to stand volatile market climate like last year," said Engel, strengthening the importance of reducing dealers' reliance on new car sales for profits.
Since he took office in the first quarter, Engel has already visited more than 30 dealer partners in China as part of his plan to inspect at least 100 each year as he always did in Germany.
Dealerships need to be convinced and even pushed to do the right thing, he said, which is all about using good services to retain customers for the future, not only for themselves, but also for the BMW brand.
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