Let's Get Serious: How Car Brands Are Courting Young People | 2015 Youth Series

From corporate strategy to marketing tactics, online and offline, car brands have pounced on anything that touches young people.

Car brands did not start calling themselves "young" in 2015, but over the past year they courted the young harder than ever.

Chevrolet issued a press release in emoji, young people's favorite picture language. Ford held talks with WeChat about building a chat feature. Mercedes-Benz teamed up with Uber to launch one-tap helicopter hailing in Shanghai. Cadillac stole the show at Tmall's Singles' Day gala by selling 11 ATS sedans for 1 yuan each. Mini brought a VR headset to this year's Shanghai auto show. Rumors that Apple would build a car had barely surfaced before BMW jumped out to say "we could work together"...

Chevrolet's emoji press release

Executives at Nissan and Toyota stress a "youth-oriented" corporate strategy at almost every public appearance. General Motors has set about tidying up its fragmented digital marketing. Daimler even rebuilt its marketing and sales department, seating people from telematics, entertainment, IT and other divisions together to work out which marketing plans young people like...

This year autonomous driving became a trend you could feel. "Car Airbnb" and "car e-commerce" turned into fashionable marketing buzzwords for "luring" young people before anyone could see what real innovation they brought. Brand and new-model slogans alike filled up with words such as "love," "dare," "wild," "freedom" and "dream," chosen to set young people's nerves tingling.

The auto industry grows ever keener on new technology, and turns up ever more often wherever young people gather.

A McKinsey report released this April may explain why. The world's 21 leading automakers depend more and more on China, North America and their luxury-car businesses for profit. In 2014, 70% of their profits came from North America and China, up from 65% in 2013. Luxury cars made up only 12% of 2014 sales but 38% of profits, up from 33% in 2013.

So in the United States they try to decode "millennials," while in China a single market insight, that "people who spend money on cars, especially luxury cars, are much younger than in Europe and North America," is enough to make them work hard at pleasing the post-1980s and post-1990s generations.

From corporate strategy to marketing tactics, online and offline, car brands have pounced on anything that touches young people.

First, how they go looking for young people

Into WeChat Moments

WeChat, with 650 million monthly active users, says its users are mostly young: the average age is 26, and about 86% are between 18 and 36.

BMW became one of the first advertisers on Moments. After it set the example, Infiniti put Perfect Escape, a film shot for the QX50 starring Gao Shengyuan and Zhou Xun, onto Moments while the couple's wedding was still a hot topic. Jeep Cherokee, FAW Toyota, Changan Eado, Roewe, Porsche and others followed into the Moments feed, with copy and visuals aimed squarely at young people.

"Flirting" with e-commerce

The other place the auto industry was busy in 2015 was e-commerce platforms, also young people's turf.

During this year's Shanghai auto show, Alibaba hosted an "auto show" of its own that drew presidents, directors and general managers from more than 40 car, parts and service brands, including Jaguar Land Rover, Buick, Toyota and Bosch. In hindsight it looked more like a rally ahead of Tmall's Singles' Day. In the end 45 car brands, including Cadillac, Buick and Volvo, and more than 50 models joined the shopping spree.

Into celebrity reality shows

After Infiniti pulled off a marketing miracle with the first season of Dad, Where Are We Going?, car brands began crowding into celebrity reality shows.

Volkswagen Lamando sponsored the first season of Running Man (the Chinese edition, Keep Running). The new Changan Mazda CX-5 became the official car of Dad, Where Are We Going? 3. Dongfeng Nissan Venucia went to the second season of Zhejiang TV's Dad's Back. MG GS sponsored Let's Fall in Love. GAC Toyota Highlander ran off to Extreme Challenge. Buick Envision turned up in Real Man. Impossible Challenge and Amazing Challenge are now the most expensive ad slots CCTV sells; Changan Ford and Roewe 360 bought their 2016 title sponsorships. Infiniti, now an old hand, simply partnered with Shenzhen TV to make The Amazing Race China, where it can get all the exposure it wants.

Buick Envision is the title sponsor of Real Man

Fancy crossovers

The auto industry has always liked crossovers with fashion, film and art, but in 2015 the tricks multiplied.

Just as Mercedes-Benz announced its one-tap helicopter service with Uber in Shanghai, Lincoln launched a "Didi sedan Lincoln package" with Didi. Audi worked with Tencent on the "Audi A3 · 2015 QQ Music Awards" and eight concerts, and Ford Mustang teamed up with the musician Zuoxiao Zuzhou on Christmas Eve. Everyone joined a contest to see who could "play" harder and smarter.

Partying on site

Mini brought a VR headset to the Shanghai auto show early in the year. At its "theme night" before the Guangzhou auto show at year's end, Chevrolet put up a two-meter-tall Optimus Prime and filled the venue with yo-yos and shuttlecocks in every color, while seven or eight couples of post-1980s Chevrolet owners from across China told the stories of their struggles on stage. Piggybacking on the "2015 ILLUMI RUN" color night run, Buick staged a "Handsome Night Run" event, using a Regal GS in glow-in-the-dark paint and the Verano sport sedan as props. The all-electric BMW i3 also appeared on the course of this year's Shanghai Marathon.

They try to show up wherever young people show up, straining to project a youthful air. Along the way came plenty of marketing gimmicks and buzzwords.

The five biggest marketing gimmicks of the 2015 auto industry

Smart cars

Ever since Google revealed its driverless car in 2009, the smart car has been a concept that keeps getting hyped. This July, Apple senior vice president Jeff Williams's line that "the car is the ultimate mobile device" set many people speculating about an Apple car. At CES 2015, Audi, BMW, Mercedes-Benz and others all showed off their own driverless technology.

Car companies increasingly like to dabble in tech, and you have probably been hearing more and more sales terms like smart parking, smart unlocking and smart in-car entertainment.

Car apps

Try searching the iPhone App Store for Volvo, General Motors, Ford and the like. You will find 16 apps under Ford Motor Company, 13 under General Motors and about ten under Volvo, plus two official truck games.

Beyond the functions that replace a car key, such as locking and unlocking, starting and stopping the engine, sounding the horn and finding the car by GPS, Volvo added remote pre-heating and pre-cooling of the cabin. Download and pair the Mazda app, and it will call for help automatically when it detects an accident. Toyota's in-car entertainment system, Entune, connects to the music app Pandora, the ticketing service Movietickets and Microsoft's Bing search.

Car official accounts

If carmakers around the world are keen on apps, in China they pour enormous energy into WeChat official accounts, and they are adept at riding hot topics for promotion.

For example, "Princess Mi Yue Arrives | The 8 Running Man Brothers Guard Her Majesty, Live," posted on BMW China's official account, was really promoting the BMW X1. Chevrolet's "Hot Review | Choosing a Car Is Like Choosing a Man: Mi Yue's Exclusive Tasting" was promoting the newly launched 2016 Chevrolet Malibu. To match its brand slogan, "Passion: Chasing Dreams Together," Chevrolet even gave all its official-account posts a uniform "Hot · X" format.

From headlines to writing tricks, these posts resemble today's popular WeChat official accounts (the so-called 100,000+ reads crowd). More and more car ads also run on currently hot accounts such as Serious Gossip, Shiliupo Report and Toxic Tongue Movies.

Car sharing

In the industry's trendier phrasing, it is "car Airbnb."

BMW's car-sharing service DriveNow launched in Munich in 2011 and within four years covered San Francisco, London, Vienna and five German cities. It mainly uses BMW 1 Series cars and MINIs.

DriveNow's main rival is Daimler's Car2go. This B2C car-sharing program, built mainly around Mercedes-Benz smart cars, dates back to 2008 and has grown into the world's largest B2C car-sharing brand. It entered China this year, starting with Chongqing.

The Car2go program

In June, General Motors also announced that its Opel brand would offer a car-sharing service, "CarUnity," letting owners rent their cars through an app to friends on social networks.

Ford prefers to call it offering broader mobility solutions. "Consumers told us they are very interested in how the costs of shared car ownership are divided, and this program helps us understand the most consumers will tolerate spending on a Ford," said David McClelland, Ford's vice president of marketing.

It looks more like a way to gather consumer insight. Ola Källenius, the Daimler board member in charge of marketing and sales, also said the car2go program can improve the customer experience and enable one-to-one customer relationship management.

Customized cars

These tend to travel hand in hand with the so-called demand for personalization.

Before Singles' Day this year, Geely and the e-commerce platform Biyao announced a customizable sedan sold online, the Geely Panda Cool Edition. Buyers can choose the exterior and interior configuration themselves: 11 colors, including 8 solid colors and 3 two-tone film-wrapped bodies; manual or automatic transmission; and extras such as a 10-inch tablet-sized screen. It reignited debate about car customization.

The pioneer of car customization is probably Rolls-Royce. Oil-rich Arab tycoons went as far as studding the front, rear and beltline of their cars with diamonds and other jewels, with everything inside, from carpets to seats, made by master craftsmen.

That kind of haute couture hardly deserves praise. But how does what carmakers now call customization differ from the base, mid-level or top trims a 4S dealership already offers?

Some luxury brands do keep high-performance divisions, such as BMW's M and Mercedes-Benz's AMG, which mainly build high-performance versions of mass-production models or launch special editions.

The eight buzzwords of the 2015 auto industry

Product genius

Yes, this is copied from Apple's retail stores. Robert Parker, president of Lincoln China, told QDaily at the Guangzhou auto show that Lincoln's goal in building its retail network is to create physical stores like Apple's.

Ola Källenius also said that, to deliver the best customer experience, Mercedes-Benz staffs its retail network with a "product expert team" similar to Apple's Geniuses, though Mercedes calls them "product concierges."

At the BMW Brand Experience Center in Shanghai, a Product Genius holding an iPad will gladly answer all your questions for as long as you need. These "product geniuses" do not sell anything, and of course they work not in 4S dealerships but in experience centers of every kind.

Experience

When any industry starts stressing this word, competition has already turned fierce.

"In the past, when the auto industry was expanding fast, many dealers rushed to deliver cars and close deals, and neglected the consumer experience," Parker said. The "Lincoln Way" stores they have set up in China are meant to offer a different experience, and in fact there are already many experience centers like them.

• In early 2016, a Mercedes-Benz brand experience center will open in Sanlitun, with a Mercedes-Benz restaurant, bar, lifestyle store and more, as a playground where Mercedes fans can gather.
• In April 2015, Dongfeng Renault opened its first experience center, in Shanghai
• In December 2014, Audi's sport car experience center opened in Beijing
• In 2013, the world's first BMW Brand Experience Center and the world's first Mini Brand Experience Center opened in Shanghai
• In 2013, Audi's first digital city showroom in Asia opened in Beijing
• In April 2012, Mercedes-Benz's first standalone AMG Performance Center anywhere in the world opened in Sanlitun, Beijing
• In May 2011, Volkswagen's "Volkswagen Self-Made" experience hall opened in the Orange Hall of Sanlitun Village South, Beijing

The auto industry calls this an innovative experiment in retail experience, and ultimately hopes to earn a "cool" label among young people.

"Love"

These words show up mostly in marketing slogans: Infiniti's "Dare to Love," Chevrolet's "Passion," along with "joy," "charge," "cool" and "freedom." All these fervent words are aimed at young people.

Buick Encore's "When you're young, go SUV," GAC Toyota Levin's "The direction is in my hands" and DS's "Want to go wild?" all try to speak to young people in the language they are guessed to like. At bottom this is no different from Toyota's old "Where there's a road, there's a Toyota." It all comes down to what tone young people like.

Looks

According to a McKinsey survey, over the next 10 years China, as the dominant market and production hub, will have a major influence on how cars are designed. Chinese tastes and standards will carry global weight, especially in the luxury market, where carmakers have clearly raised their standards. Surveys show that when young consumers born in the 1980s and 1990s buy a car, design ranks second and first respectively among their purchase factors.

Jaymer Starbody, exterior designer of the Chevrolet Malibu XL, at the Guangzhou auto show

So global design directors show up to lend support more and more often, and the brands have begun to stress their designers' youth. Liu Zheming, chief designer of Infiniti's Vision GT concept car, who was paraded before the media at the Shanghai auto show, was only 25. The chief designer who appeared for the 2016 Chevrolet Malibu at the Guangzhou auto show was likewise only 26.

They believe young people understand young people better.

Digitalization

More advertising money is flowing to digital media. Ji Qiyi, head of Chevrolet marketing at SAIC-GM, told QDaily at the Guangzhou auto show: "In recent years the split between traditional and new media spending has changed markedly. Traditional media is falling very fast, even faster than our own industry is changing."

GM is also standardizing its digital activity worldwide. It now builds its marketing teams and organizes its digital campaigns around the consumer's purchase journey: from building brand awareness, to steering consumers to its websites, to engaging them with video and other content, to getting them to request a test drive, to the sale, and finally to how consumers share and spread word of their driving experience. Every step is accounted for.

Mercedes-Benz is the same. "We offer all-round service around the car and even beyond the car itself. From advertising and physical displays to the look of our stores, we strive to make every visual and sensory experience blend seamlessly with the digital world," Ola Källenius said.

"Chinese-style" innovation

As carmakers lean more and more on the Chinese market, they also like to talk more and more about innovation from China. It is another way of courting the Chinese market.

This usually takes the form of opening innovation labs and design centers, holding innovation contests, and going straight onto campuses for "academic" exchanges.

Connected, mobile

In short, they want the car to do everything a smartphone can do today.

The real question: are young people really the mainstream market?

According to the 2015 China Auto Consumer Insight Report, released jointly this November by the consultancy Roland Berger and Bitauto, people born in the 1980s and 1990s have become the car market's mainstream buyers. Consumers under 35 rose from 45% of all car buyers in 2013 to 54% in 2015, and those under 30 already account for 36%. So the answer is "Yes."

Young people have begun to set consumer trends. Compared with the more pragmatic buyers born in the 1960s and 1970s, they care more about fashionable, sporty design, and they know more about cars than the previous generation. They want value for money, and often quality on top. That is why SUVs and luxury-brand compact sedans are the most popular cars in the youth market, and why carmakers are making their lineups younger.

Where they get information has changed too. J.D. Power's 2015 China Automotive Media Study found that 90% of car buyers say new media are their main source of information when buying a car. WeChat is the new-media channel buyers use most often (33 times a month on average), but it has relatively little sway over purchase decisions: only 3% of buyers use WeChat to look up models and prices.

Yet buyers born in the 1990s like sharing information about their purchases, especially on WeChat (33%), and 69% of what they share is positive. Of all age groups, post-1990s buyers follow carmakers' official WeChat or Weibo accounts the most (26%). That is why the auto industry stresses digitalization.

So judging by the shift in consumer trends, all this assorted youth marketing is heading in the right direction.

So who did comparatively well in the youth market?

Only clever enough tactics can catch young people's attention and nudge them toward a purchase. How well did the youth marketing described above actually work? Let's look at a few cases.

From May to July, while Hunan TV aired Real Man, the Baidu search index for Buick Envision did rise, and sales rose month on month too, with a lingering effect in the months after. But sales depend on many factors, such as promotional discounts, so all we can conclude is that sponsoring the variety show earned Buick Envision buzz and searches, and may also have helped sales.

By contrast, Changan Mazda, which also sponsored Dad, Where Are We Going? 3, seems to have seen little effect in either its Baidu search index or its sales.

Tmall's Singles' Day gave Cadillac enormous exposure. Its Taobao index hit a startling peak in October, when the warm-up began, and a smaller one in November. Sales showed no such correlation, though they were still well up on the same period last year; the peak in year-on-year growth, however, came before last year's Spring Festival.

Likewise, although Audi also had small peaks in Taobao searches in October and November, it sold 49,519 new cars in China (including Hong Kong) this November, down 5.8% from a year earlier. From January to November, Audi's cumulative sales in China reached 510,692 vehicles, down 1.1% from 516,356 in the same period last year.

Every marketing tactic is ultimately meant to drive sales, but the two do not always move together. No marketing miracle is easy to repeat, even for the brand that pulled it off. Advertising matters, but a good product that fits what the market wants matters more.

In 2015, China's top three luxury brands were still Audi, BMW and Mercedes-Benz, but Audi is slipping in both reputation and sales. BMW grew 3% year on year, roughly holding its ground, while Mercedes-Benz grew as much as 32.8% in the first 11 months. Jaguar Land Rover fell 25.7% year on year, the steepest drop among luxury brands. Cadillac, Porsche and Infiniti all grew fairly fast, and Lexus can be said to have made a comeback.

As for the non-luxury brands, well, young people have always been their main business anyway.

We cannot cover every car brand's youth marketing in one article, but by now you should be able to feel how eager they are for young people (that's you). One word of advice: don't chase youth for youth's sake.

(Reporter Zhifei Dong also contributed to this article.)

Graphics: Bingqing Xu