Market entry consulting is an important area of the consulting industry and one of the core businesses of Champ Consulting Group. Champ Consulting Group is a global management consulting firm with more than 1000 consultants, providing strategic, operational, organizational, technical and financial consulting services to clients in various industries. The purpose of the Champ Consulting Group is to help clients achieve outstanding performance and create sustainable value.

This article will take the case of market entry consulting provided by Champ Consulting Group for a European automobile manufacturer as an example, introduce the process, method and results of market entry consulting, as well as some reflections and suggestions on market entry consulting.

1. Case Background

Customer is a German-based automaker that produces high-end cars and sports car with a long history of brands and a loyal customer base. Customers have high market share and profit margins in developed markets such as Europe, North America and Japan, but underperform in emerging markets such as China, India and Southeast Asia, where market share and revenue growth are slow or even declining. Customers recognize that to maintain competitiveness and growth potential, they must accelerate their expansion in emerging markets, especially in China, which is the world's largest automotive market and one of the most promising. The client expects the help of Champ Consulting Group to develop and implement an effective market entry strategy to increase its share and revenue in the Chinese market.

2. market analysis

The first step of Shangpu Consulting Group is to conduct a comprehensive analysis of the Chinese auto market, including market size, growth rate, structure, competitive landscape, consumer demand, policies and regulations, industry trends, etc. Through the collection and analysis of large amounts of data and information, the Champ Consulting Group made the following key findings:

The Chinese auto market is a huge market, with car sales reaching 25 million units in 2019, accounting for nearly 30% of global car sales. It is estimated that by 2025, the size of China's automobile market will reach 35 million, a growth rate of 6.8.

China's auto market is a diversified market, with many types of cars, including cars, SUVs, MPVs, sports car, and new energy vehicles. Among them, cars are the largest market segment, accounting for nearly 50% of total sales, but the growth rate is relatively low, only 2.3 percent. SUVs were the fastest-growing segment, accounting for nearly 40 percent of total sales, with a growth rate of 12.5 percent. New energy vehicles are the most promising market segment, accounting for nearly 10% of total sales, with a growth rate of 25.6.

The Chinese auto market is a highly competitive market with multiple players, including domestic brands, joint venture brands and imported brands. Among them, domestic brands account for nearly 40% of the total sales, mainly attracting consumers with low prices and diversified products, but there are still deficiencies in quality and technology. Joint venture brands account for nearly 50% of total sales. They mainly win the trust and recognition of consumers with mid-to-high-end products and services, but there is still room for improvement in innovation and differentiation. Imported brands account for nearly 10% of total sales, mainly attracting consumers with high-end products and brand image, but there are still challenges in terms of price and localization.

China's auto market is a rapidly changing market, which is affected by many factors, including consumer demand, policies and regulations, technological innovation, and social environment. Among them, consumer demand is the most important driving force. With the improvement of consumers' income level, lifestyle, personalized needs, and environmental awareness, the quality, function, design, safety, comfort, and energy saving of automobiles The requirements are getting higher and higher. Policies and regulations are the most important constraints. With the strengthening of government supervision and support for the automobile industry, regulations on automobile emission standards, energy types, market access, and tax incentives are becoming more and more stringent. Technological innovation is the most important factor of change. With the development and application of science and technology, the progress of automobile intelligence, electrification, networking and sharing is also faster and faster. The social environment is the most important influencing factor. With the change and development of society, the cultural significance, social responsibility, public transportation, urban planning and other aspects of the automobile are also increasing.

3. target market selection

Based on the results of the market analysis, Shangpu Consulting Group helped the client to determine its target market segments and target customer groups in the Chinese market. Shangpu Consulting Group believes that customers should focus on high-end cars and sports car market segments, as well as high-income, high-education, high-taste, pursuit of personality and quality of consumers. These market segments and consumer groups are characterized:

The segment of high-end cars and sports car is a relatively small but highly profitable market, accounting for about 5% of total sales, but about 15% of total revenue. The growth rate of this market is 8.7 percent, which is higher than the average level of the car market. The competition in this market mainly comes from imported brands, such as Mercedes-Benz, BMW, Audi, Porsche, etc. These brands have high visibility, reputation and loyalty in China, but they also face problems such as price sensitivity, unfavorable policies, and insufficient localization.

The consumer group with high income, high education, high taste and pursuit of individuality and quality is a relatively small but high-value consumer group, accounting for about 10% of the total population, but accounting for about 30% of the total consumption. These consumers have an annual income of more than 500000 yuan, have higher education, have higher aesthetics and taste, like personalized and customized products and services, pay attention to quality and performance, and do not hesitate to spend high prices to buy their favorite cars. The needs of these consumers are diverse and dynamic, evolving as markets change and individuals grow.

Shangpu Consulting Group believes that customers have strong competitive advantages and growth potential in these market segments and consumer groups, because their cars have the following characteristics:

The customer's car is a high-end car with excellent quality, performance, design and safety, which can meet the needs and expectations of consumers for high quality cars.

The customer's car is a unique car with a unique brand history, culture and image, which can meet the needs and preferences of consumers for personalized cars.

The customer's car is an innovative car with advanced technology and functions, which can meet the needs and trends of consumers for intelligent, electric, networked, and shared cars.

4. market entry mode selection

After identifying the target market and target customers, the Champ Consulting Group helps the client choose the model that best suits their market entry. Market entry mode refers to the ways and means for enterprises to enter new markets or expand existing markets, including export, authorization, joint venture, sole proprietorship, merger and acquisition, etc. The choice of market entry mode depends on a variety of factors, such as market attractiveness, competitiveness, risk, complexity, etc., as well as the company's goals, resources, capabilities, and experience. Through comparative analysis of the advantages and disadvantages of various market entry modes, Shangpu Consulting Group finally recommends customers to adopt the market entry mode of sole proprietorship, that is, to establish their own production and sales base in China, in order to achieve complete control of the market and maximize the benefits. Champu Consulting Group believes that the sole proprietorship market entry model has the following advantages:

Sole proprietorship can protect the customer's core technology and intellectual property rights, avoid competition and conflict with partners, and maintain the customer's brand image and reputation.

Sole proprietorship can improve the customer's market response speed and flexibility, according to market changes and consumer needs, timely adjustment of product and service strategies and programs, to enhance customer competitiveness and market share.

Sole proprietorship can reduce the operating costs and tax burden of customers, and use China's low-cost labor, raw materials and infrastructure, as well as government preferential policies and subsidies, to improve customers' profit margins and returns.

Of course, the sole proprietorship market entry model also has some challenges and risks, such:

Sole proprietorship requires a large investment of capital and resources, bears higher barriers and costs to market entry and exit, and faces greater uncertainty and risk.

Sole proprietorship is required to comply with China's laws and regulations, meet China's market access and environmental protection standards, and respond to China's political, economic and social changes and impacts.

Sole proprietorship needs to adapt to China's market environment and consumer culture, carry out effective localization and differentiation strategies and actions, and establish good relationships and trust with Chinese suppliers, distributors and consumers.

Therefore, Shangpu Consulting Group recommends that customers choose the sole proprietorship market entry model, but also consider the following points:

The client should develop a clear market entry goal and plan, specifying the time, place, scale, steps, budget, etc. of market entry, as well as the expected results and evaluation indicators of market entry.

Customers should conduct sufficient market research and risk analysis, understand the opportunities and threats in the Chinese market, and formulate corresponding countermeasures and backup plans to reduce the risks and losses of market entry.

Clients should establish a professional market entry team, including local managers, technicians, market personnel, etc., as well as external consultants, lawyers, accountants, etc., to ensure smooth and effective market entry.

Customers should maintain good communication and cooperation with the Chinese government and relevant departments, understand and abide by Chinese laws and regulations, apply for and obtain necessary permits and approvals, and enjoy and utilize government support and concessions.

Customers should establish good cooperation and competition with China's automobile industry and related industries, understand and respect China's industry rules and practices, and participate in and contribute to China's industry development and innovation.

Customers should establish good communication and relationship with Chinese consumers, understand and meet the needs and preferences of Chinese consumers, provide and deliver customer value and advantages, and increase and maintain the awareness and loyalty of Chinese consumers.

5. market entry plan development and execution

After choosing the sole proprietorship market entry model, Shangpu Consulting Group helped the client to develop a specific market entry plan, including the following aspects:

Market entry time: Shangpu Consulting Group recommends that customers start to establish their own production and sales bases in China in 2024, and expect to complete the entire market entry process in 2026 to achieve full operation and development in the Chinese market.

Market entry location: Shangpu Consulting Group recommends that customers establish their own production and sales bases in the eastern coastal areas of China. These areas have developed economies, convenient transportation, dense populations, and high consumption levels. They are the main markets and consumers of high-end automobiles. group. Specifically, Shangpu Consulting Group recommends that customers set up their own factories and sales outlets in first-tier cities such as Shanghai, Beijing, Guangzhou, and Shenzhen and second-tier cities such as Hangzhou, Nanjing, Suzhou, and Tianjin.

Scale of market entry: Shangpu Consulting Group recommends that customers gradually expand their scale in the Chinese market, starting from small-scale pilots and tests, to medium-scale promotion and marketing, and then to large-scale production and sales. Specifically, Shangpu Consulting Group recommends that customers launch 1000 cars in the Chinese market in 2024, mainly for market research and brand promotion, and to establish contact and trust with potential partners and consumers; in 2025 In the Chinese market, 5000 cars will be launched, mainly for marketing and marketing, and to increase communication and interaction with existing partners and consumers; 20000 cars will be launched in the Chinese market in 2026, mainly used for market production and sales, as well as with all partners and consumers to achieve long-term cooperation and loyalty.

Steps to market entry: Champ Consulting Group advises clients to plan and execute market entry as follows:

The first step: market preparation. In this step, the customer needs to complete the following tasks: communicate and negotiate with the Chinese government and relevant departments to obtain market entry permits and approvals; establish contacts and cooperation with the Chinese automotive industry and related industries to understand the rules and practices of the market; establish cooperative relationships with Chinese suppliers and distributors to ensure the supply and distribution of products and services; establish a good image and reputation with Chinese media and public, improve brand awareness and recognition; establish initial communication and relationship with Chinese consumers, understand and meet their needs and preferences.

The second step: market pilot. In this step, the customer needs to complete the following tasks: put a small number of cars in some cities and regions of China, conduct market research and brand promotion, collect and analyze market feedback and data, evaluate and optimize product and service strategies and programs, adjust and improve market entry plans and budgets.

The third step: marketing. In this step, customers need to complete the following tasks: put more cars in more cities and regions in China, carry out market promotion and marketing, adopt various channels and means, such as advertising, activities, exhibitions, sponsorship, etc. Enhance and deliver the value and advantages of products and services, increase and maintain market share and income.

Step 4: Market production. In this step, customers need to complete the following tasks: to establish their own production bases in selected cities and regions in China, to carry out market production and sales, to use China's low-cost resources and preferential policies, to improve the quality and efficiency of products and services, to reduce the cost and price of products and services, and to improve market profits and returns.

Step 5: Market maintenance. In this step, customers need to complete the following tasks: maintain their own sales outlets in all cities and regions in China, maintain and develop the market, continuously update and improve the strategies and programs of products and services according to the changes of the market and the needs of consumers, and enhance and consolidate the competitiveness and loyalty of the market.

Outcomes and evaluation of 6. market entry

Champ Consulting Group helps clients develop a market entry results and assessment system, including the following aspects:

Results of market entry: Shangpu Consulting Group expects that after completing the whole process of market entry, customers will achieve the following results in the Chinese market: market share of 5%, market revenue of 5 billion yuan, market profit of 1 billion yuan, and market return rate of 20%.

Market entry assessment: Champ Consulting Group recommends that customers regularly conduct market entry assessments during the market entry process to check and monitor the progress and effectiveness of market entry, as well as identify and resolve market entry issues and risks. Champ Consulting Group recommends that clients use the following assessment metrics and methods:

Evaluation indicators: Shangpu Consulting Group recommends that customers use the following evaluation indicators to measure the performance and results of all aspects of market entry: market share, market revenue, market profit, market rate of return, market satisfaction, market loyalty, Market influence, market innovation, etc.

Evaluation methods: The Champ Consulting Group recommends that clients use the following evaluation methods to collect and analyze various data and information for market entry: market research, market testing, market feedback, market reports, market audits, market consulting, etc.

Reflections and Suggestions on 7. Market Entry

In the process of providing market entry consultation for customers, Shangpu Consulting Group has also made some reflections and summaries on the nature and methods of market entry consultation, and put forward the following suggestions:

The essence of market entry consulting is to help clients achieve their strategic goals and business objectives in new or existing markets by analyzing, selecting and implementing the strategies and actions that best suit their market entry.

The approach to market entry consulting is based on the needs and circumstances of the client, as well as the characteristics and trends of the market, using scientific and systematic analysis and problem-solving tools and techniques to provide objective and professional advice and solutions.

The key to market entry consulting is to understand and meet the needs and preferences of the market and consumers, provide and deliver customer value and advantages, and establish and maintain market and consumer trust and loyalty.

The challenge of market entry consulting is to respond to and adapt to the changes and dynamics of the market and consumers, innovate and optimize the strategies and programs of customers' products and services, and enhance and consolidate the competitiveness and influence of customers.

The value of market entry consulting is to provide customers with market entry guidance and support to help customers increase market share, revenue and profits, and achieve successful and sustainable market entry.

8. Conclusion

Taking the case of market entry consulting provided by Shangpu Consulting Group for a European automobile manufacturer as an example, this paper introduces the process, methods and results of market entry consulting, as well as some reflections and suggestions on market entry consulting. Market entry consulting is a complex and important consulting service that requires consultants to have professional knowledge and skills, as well as a deep understanding and insight into the market and consumers, in order to help clients formulate and implement the most suitable strategies and actions for their market entry, and achieve their strategic and business objectives in new or existing markets. The essence of market entry consulting is to understand and meet the needs and preferences of the market and consumers, to provide and deliver the value and advantages of customers, and to establish and maintain the trust and loyalty of the market and consumers. The approach to market entry consulting is based on the needs and circumstances of the client, as well as the characteristics and trends of the market, using scientific and systematic analysis and problem-solving tools and techniques to provide objective and professional advice and solutions. The key to market entry consulting is to respond to and adapt to the changes and dynamics of the market and consumers, innovate and optimize the strategies and programs of customers' products and services, and enhance and consolidate the competitiveness and influence of customers. The value of market entry consulting is to provide customers with market entry guidance and support to help customers increase market share, revenue and profits, and achieve successful and sustainable market entry.