2022
0
China Car Owners in Lower Tier Cities Market Report 2022
2022-10-22T04:02:20+01:00
OX1104923
3695
156762
[{"name":"Automotive","url":"https:\/\/store.mintel.com\/industries\/transport\/automotive"},{"name":"Consumer Lifestyles","url":"https:\/\/store.mintel.com\/industries\/consumers-trends\/consumer-lifestyles"}]
Report
en_GB
“As cars become more intelligent, car buyers in lower tier cities are shifting their focus from being brand-oriented to practical features. Differentiated intelligent configurations can better meet their individual car…

China Car Owners in Lower Tier Cities Market Report 2022

£ 3,695 (Excl.Tax)

Report Summary

“As cars become more intelligent, car buyers in lower tier cities are shifting their focus from being brand-oriented to practical features. Differentiated intelligent configurations can better meet their individual car usage needs and quest for a technological touch. It is worth noting that even though car buyers in lower tier cities would take a positive view of innovative marketing campaigns, they still expect more practical value. Opportunities exist for positive marketing campaigns that meet their practical and entertainment needs.”
– Austin Yuan, Research analyst

Key issues covered in this Report

  • Car purchase preference: increased priority for practicality and differentiation of intelligent configuration
  • Marketing formats: product-oriented with interactive and co-creation opportunities
  • Car owners’ lifestyle: localised content and relevant car peripherals are in demand
  • Aftermarket channel: ‘acquaintance economy’ and trust-based marketing
  • Acceptance of NEVs: recognition and concerns about the trend

Table of Contents

  1. Overview

    • What you need to know
      • Key issues covered in this Report
        • Objective and methodology
          • Quantitative research methodology
            • Figure 1: The sample structure for each city is as follows:
          • Qualitative research methodology
            • Figure 2: Interviewed cities in the qualitative research
            • Figure 3: Profiles of respondents to the qualitative research
        • Executive Summary

            • The market
              • Mid-late-stage urbanisation spawns new challenges and opportunities for industrial structure development in lower tier cities
                • Figure 4: GDP sector compositions, by city tier, 2018-20
              • COVID-19 outbreaks affect the consumption environment in lower tier cities more greatly than tier 1 cities
                • Figure 5: Total retail sales and year-on-year growth rate of consumer goods, by city tier, 2018-2020
              • Lower tier city consumers tend towards conservative consumption behaviours despite limited immediate impact of the outbreak
                • Confidence in financial situation rebound steady in lower tier cities but will be indirectly affected by tier 1 and 2 cities
                  • Figure 6: Confidence in improving future finances – very confident/somewhat confident, by city tier, 2020-22
                • The consumer
                  • Car purchase preference: increased priority for practicality and differentiation of intelligent configuration
                    • Figure 7: Purchase consideration factors – interview excerpts, 2022
                    • Figure 8: Brand importance in car purchasing consideration – interview excerpts, 2022
                    • Figure 9: Importance of car functions, by age, 2021
                  • Marketing formats: product-oriented with interactive and co-creation opportunities
                    • Figure 10: Attitudes towards new forms of marketing – interview excerpts, 2022
                    • Figure 11: Attitudes towards brands highly interactive with customers – interview excerpts, 2022
                    • Figure 12: Selected attitudes towards car marketing and retailing, by age, 2022
                  • Car owners’ lifestyle: localised content and relevant car peripherals in demand
                    • Figure 13: Interest in official content or offline activities provided by brands – interview excerpts, 2022
                    • Figure 14: Membership shopping mall – interview excerpts, 2022
                    • Figure 15: Interested official content, by age, 2022
                  • Aftermarket channel: ‘acquaintance economy’ and trust-based marketing
                    • Figure 16: Aftersales maintenance and repair channels – interview excerpts, 2022
                    • Figure 17: Value more on technicians’ experience or machinery equipment – interview excerpts, 2022
                    • Figure 18: Expected future aftermarket services, by age, 2021
                  • Acceptance of NEVs: recognition and concerns about the trend
                    • Figure 19: Attitudes towards NEV – interview excerpts, 2022
                    • Figure 20: Select between domestic or foreign brands for premium EVs around RMB300,000 – interview excerpts, 2022
                    • Figure 21: Attitudes towards BEV – top three, by age, 2022
                  • What we think
                  • Introduction to Lower Tier Cities in China

                      • Mid-late-stage urbanisation spawns new challenges and opportunities for industrial structure development in lower tier cities faces
                        • Figure 22: GDP sector compositions, by city tier, 2018-20
                      • COVID-19 outbreaks affect the consumption environment in lower tier cities more greatly than tier 1 cities
                        • Figure 23: Total retail sales and year-on-year growth rate of consumer goods, by city tier, 2018-2020
                      • Real income growth slowing down in lower tier cities
                        • Figure 24: Per capita annual salary, by city tier, 2018-20
                      • Proportion of single, unmarried people in high-income groups in lower tier cities is approaching that of tier 1 cities
                        • Figure 25: Family structure of respondents, by city tier, 2019- June 2022
                      • Car ownership and gym membership penetration rates comparable to tier 1 and tier 2 cities
                        • Figure 26: Car ownership and gym membership, by city tier, 2017-June 2022
                    • Market Factors

                      • Lower tier city consumers tend towards conservative consumption behaviours despite limited immediate impact of the outbreak
                        • Figure27: Impact of COVID-19, by city tier, 2022
                      • Figure28: COVID-related actions in future, by city tier, 2022
                        • Figure28: COVID-related actions in future, by city tier, 2022
                      • Confidence in financial situation rebound steady in lower tier cities but will be indirectly affected by tier 1 and 2 cities
                        • Figure 29: Confidence in improving future finances – very confident/somewhat confident, by city tier, 2020-22
                      • Home appliances leading trading up in various categories, while commercial centres marching into lower tier market
                        • Leisure and entertainment market has considerable room for growth, while ‘social economy’ offers great potential
                          • Figure 30: Ways of de-stressing, by city tier, 2022
                        • The outbreak might reduce consumer demand for trading up in the car market
                          • Figure 31: Concerns towards car purchasing plan, by income, 2022
                      • Car Purchase Preference: Increased Priority for Practicality and Differentiation of Intelligent Configuration

                        • Practical considerations and differentiation of smart configurations
                          • Figure 32: Purchase consideration factors – interview excerpts, 2022
                        • Pragmatism undermines the brand-driven mindset
                          • Figure 33: Brand importance in car purchasing consideration – interview excerpts, 2022
                        • Senior car owners are most interested in smart configuration
                          • Figure 34: Importance of car functions, by age, 2021
                        • Highlighting the differentiation of exterior and interior design can effectively attract the younger group
                          • Figure 35: Car purchase concerns, by age, 2021
                        • Meeting exclusive needs through differentiated appearance
                          • Figure 36: ORA Lightning Cat, 2022
                      • Marketing Formats: Product-oriented with Interactive and Co-creation Opportunities

                        • Marketing innovation is not about the form, but the positive spirit
                          • Figure 37: Attitudes towards new forms of marketing – interview excerpts, 2022
                        • User-centric mindset brings brands closer to car owners
                          • Figure 38: Attitudes towards brands highly interactive with customers – interview excerpts, 2022
                        • Positive brand campaigns and communications are more effective in reaching car owners in lower tier cities
                          • Figure 39: Selected attitudes towards car marketing and retailing, by age, 2022
                        • Customer co-creation is best recognised by consumers aged 30-39
                          • Figure 40: Brand image – highly interactive with customers (c), by age, 2022
                        • High customer interactivity benefits both sides
                          • Figure 41: BAIC ORV BJ60, 2022
                        • Integrating marketing with online and offline traffic to enhance brand reach
                          • Figure 42: Douyin Car Carnival, 2021
                          • Figure 43: Poster for the Super 818 Motor Gala Night 2021
                      • Car Owners’ Lifestyle: Localised Content and Relevant Car Peripherals Are In Demand

                        • Creating driver lifestyle networks to meet car users’ needs
                          • Figure 44: Interest in official content or offline activities provided by brands – interview excerpts, 2022
                        • Automotive peripherals need to be more relevant to car usage
                          • Figure 45: Membership shopping mall– interview excerpts, 2022
                        • Lifestyle services guide more appealing to car owners in lower tier cities in their 30s
                          • Figure 46: Interested official content, by age, 2022
                        • Consumers in their 30s are interested in self-driving tours and exclusive apps for car owners
                          • Figure 47: Activities to enhance consumers’ favourability, by age, 2021
                        • Auto peripherals relevant to local and everyday life seeing opportunities
                          • Figure 48: Hongguang MINIEV Macaron ice cream, 2022
                        • A new lifestyle rising with the camping trend
                          • Figure 49: Tank 300 Camping Season promotional photos, 2022
                          • Figure 50: Xiaodu Tiantian collaborated with MINI to launch the campaign Drive and Sing to Camping, 2022
                          • Figure 51: Beijing X7 Have Fun and Go Camping, 2022
                      • Aftermarket Channel: ‘Acquaintance Economy’ and Trust-based Marketing

                        • Trusted acquaintance channel on par with professional 4S stores
                          • Figure 52: Aftersales maintenance and repair channels – interview excerpts, 2022
                        • Trusting human beings more and sceptical of the ‘singularity’, ‘inflexibility’ and ‘value for money’ of smart devices
                          • Figure 53: Value more on technicians’ experience or machinery equipment – interview excerpts, 2022
                        • Aftermarket service with assurance attributes presents opportunities
                          • Figure 54: Expected future aftermarket services, by age, 2021
                        • Excellent service and good prices are the key to aftermarket service
                          • Figure 55: Selected attitudes towards aftermarket service, by age, 2021
                        • Opportunity for ‘small stores’ in lower markets thanks to their flexibility and cost advantages
                          • Figure 56: Tuhu.cn branch in lower tier market, 2022
                      • Acceptance of NEVs: Recognition and Concerns about the Trend

                        • Recognition of the NEV trend and the technical bottleneck of BEVs highlight the advantages of hybrid models
                          • Figure 57: Attitudes towards NEV – interview excerpts, 2022
                        • Domestic players capitalise on new tech to quickly overtake in NEV sector
                          • Figure 58: Select between domestic or foreign brands for premium EVs around RMB300,000 – interview excerpts, 2022
                        • Environmental concept wins over young consumers aged 18-29
                          • Figure 59: Purchase motivations, by age, 2022
                        • Access to vehicle data more appealing to younger car owners aged 18-39 in lower tier cities
                          • Figure 60: Attitudes towards BEV – top three, by age, 2022
                        • Marching into overseas markets to bring Chinese brands to the next level
                          • Figure 61: Voyah opens first space outside China in Norway, 2022
                          • Figure 62: Xpeng’s self-operated experiencing store in Denmark
                        • Use user data to optimise products and achieve win-win results by feeding data back to users
                          • Figure 63: The Raw Stone Plan of IM Motors, 2022
                      • Appendix

                        • Abbreviations
                          • Interviewees’ photos

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