dentsu China publishes white paper: The road to success in China's Electric Vehicle market

Today, dentsu China announced the breakthrough study, The Road to Success in China's Electric Vehicle Market, in partnership with MaLogic, TalkingData, and UnionPay Advisor. Our report provides an in-depth view of the consumer behaviours, sentiments and buying habits that shape this exciting opportunity for marketers in our interconnected era. 

The wide range of data analysed includes both conventional and electric vehicles (EV) and a great amount of transactions. The report considers the challenges and opportunities in this already highly competitive electric vehicle market. It offers actionable steps for brands to successfully align marketing strategies to the unmet needs of prospective customers. 

Deric Wong, CEO, dentsu China, said: “The Electric Vehicle market is increasingly competitive and fast-paced. We are excited to team up with Malogic, to unlock consumption data to better understand the consumption choices, behavioural patterns and priorities of EV buyers. Our report also provides marketers with vital insights to connect with current and prospective category buyers, helping them pave the way for future success in an increasingly changing market."

“Future success lies not only for vehicles with optimized battery management but also those that offer consumers a wide range of digital services In addition to understanding the consumer behaviour, with deep analysis and simulation, we look at mobile data from TalkingData to identify criteria for precise customer targeting and optimized marketing strategies to meet the needs of future EV buyers.” said Wong.

It’s the younger generation that will drive future business growth in the automotive industry. The car has evolved from a ‘means of transportation’ to an ‘enabler of individual mobility’. Determining purchase factors such as consumers’ decision-making paths, EV brand impressions, and definitions of “premium” are continually being restructured. 

“Our findings indicate that the electric vehicle market still offers great potential, especially in the upper mid-range and premium segments. We have found that the spending behaviour of current Chinese premium EV brand buyers is equivalent to that of buyers of traditional non-premium conventional cars. We can therefore conclude that most buyers of legacy premium car brands are still looking for a premium EV offering that suits their needs. This is good news for traditional premium automakers as the EV market still offers them a tremendous opportunity.” said Eliza Wong, CEO of MaLogic.

WHAT THE STUDY REVEALED:

CONSUMPTION POWER OF EV BUYERS IS UP TO 33% LOWER THAN TRADITIONAL CARS

Analysing the share of wallet at the regional and city level shows that Chinese EV buyer spending is underrepresented in the eastern and southern regions and tier 1 cities. The average spend of all category EV buyers is up to 33% below that of buyers of conventional cars. This indicates a significant demand for bespoke EV offerings in geographies with the highest purchasing power.

APPROACH CHINESE EV BUYERS THROUGH IDENTIFIED LOCATIONS/CHANNELS

In terms of broader consumer behaviour, buyers of conventional cars seem to place more value on larger ticket purchases (e.g., real estate, jewellery, etc.). Chinese EV buyers are following a more pleasure and leisure-oriented consumption pattern, with much of their wallets being spent in service industry categories such as coffee shops, karaoke, cinema, sports activities, and travel. Similar behaviour, albeit to a lesser extent, is exhibited by buyers of conventional cars. With that, the service industry categories seem to be relevant for interacting with customers.

Buyers of Chinese EV brands tend to gravitate toward financial management apps (11 out of the top 15 apps), while buyers of conventional cars use a wider variety of apps. Overall, the average target group index (TGI), a measure of target group usage efficiency, is 80% higher among Chinese EV buyers (429 vs 236). This underscores the importance of precise targeting to achieve the best results.