GM Strategy in the China Market
Introduction
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The research explores the integrated marketing communications (IMC) strategies applied by General Motors (GM) in the introduction of the Cadillac automobile name plate in the China market. IMC strategies are highly complex and were created primarily from a perspective that focused on conditions in developed economies. While IMC strategies have a role in marketing in China, these strategies are not as relevant to the marketing of luxury automobiles in a market where the mean annual income is less that US$3,000 as they are relevant to markets in the United States, Germany, the United Kingdom, and other highly developed Western economies.Marketing Cadillac in the China Market An IMC strategy envisions the use of media advertising, direct marketing, interactive/Internet marketing, sales promotion, and publicity/public relations (Belch & Belch, 2004). While this set of integrated marketing communications channels is available in the China market, the mix of the proportional application of the elements of the IMC channel set is influence to a great extent by more traditional considerations of market segmentation and target market definition for specific products in the China market. The increasingly outward focus of GM reflects a corporate strategy based on the companyÆs recognition of shifts in the loci of opportunities for the company from the domestic sphere to the global domain. GM has established an operational division for China that markets (a) automobiles manufact
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ting of Cadillac in the China market and the use of an IMC strategy in this marketing effort, the mix of marketing communication channels must be tailored to the relatively small segment of the target market for passenger automobiles that (a) GM has defined for the China market and (b) has the capacity to pay cash for the Cadillac automobile purchased.
In terms of units, GM sales in the China market increased from 60,000 in 2001 to 250,000 in 2002 and to 360,000 in 2003 (McCormick, 2004). GM hopes to sell 450,000 automobiles in China in 2004. GM outsold Volkswagen (VW) of Germany in the China market in June 2004 for the first time on a monthly basis as a result of a price war. For the year, VW remains well ahead of GM in number of units sold in China. GM states that the companyÆs China market share in 2004 is 12 percent (ôGM Outsells Volkswagen in Chinaö, 2004).
GM expects household incomes to rise above the US$3,000 level in ChinaÆs major cities in 2005. This income level will cause many new buyers into the automobile market. GM also plans to begin making auto loans through General Motors Acceptance Corp. in 2005 of the various hurdles mentioned earlier in this report are overcome (Guilford, 2004).
The company assumes th
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Approximate Word count = 1387
Approximate Pages = 6 (250 words per page)
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