The luxury automobile industry in India has begun to focus on increasing its sales and brand awareness in tier-II and tier-III cities
Realizing that affordability and aspiration levels in smaller cities represent untapped potential, brands are coming up with innovative strategies to entice customers to buy a luxury vehicle. Brands also say that tier-II and III cities are beginning to attribute to a sizeable portion of their sales figures. Mercedes Benz India, which celebrated its silver jubilee at Sundaram Motors in the city on Wednesday, declared that last year almost 25% of their overall vehicle sales came from tier-two and tier-three cities.
“The numbers are constantly growing,” executive director of Sundaram Motors Sharath Vijayaraghavan said. “We believe the market in these cities is still unexplored, but slowly opening and growing,” he added. Coimbatore which contributes to a third of the Mercedes’s sales in Tamil Nadu, has seen at least three more luxury automobile brands — Audi, BMW and Volvo open showrooms in the last seven years.
The brands to tap into a market, which was initially perceived to be conservative, are now working on getting more people to “experience the feel of a luxury car”.
“In smaller cities like Salem, Coimbatore and Madurai, we conduct programs like Brand Tour and Luxe Drive so that people can get a tour of our showrooms, facility and history to know and understand the brand,” Vijayaraghavan said.
An Audi marketing manager said getting more people to experience the feel of a luxury car, hoping that it will entice customers towards working on acquiring one is their main strategy in smaller cities. “We participate in a lot of shows and events, so that people can get a close look at the car and get attracted to its appearance. We also allow almost any curious customer to enjoy a test drive and even follow up enquiries, by taking the cars to their doorstep for test drives. We don’t always hope for a sale immediately,” he said.
“We also provide offers like four and five years of warranty on certain models of cars, give them free service for a few years and even buy back offers,” he added.
Volvo which has only recently began focusing on smaller cities has employed retail consultants at smaller cities like Madurai and Tirunelveli, so they can follow up on any enquiries they get from their centres and neighbouring districts. “Once they line up around 10 customers, we take the models they are interested in to those towns and customers’ doorsteps allowing them to take a test drive,” an official said. “But it is a market that the brand intends to tap into,” he said.