Auto importers use VIP marketing to woo rich

Import automakers are stepping up their marketing aimed at Korea’s affluent demographic to capitalize on the rising popularity of import cars.
Import vehicles are rapidly taking a bite out of the market share of domestic carmakers, said Yoon Dae-sung, executive director of the Korea Automobile Importers and Distributors Association.
“The 40-percent growth of import vehicle buyers in their 20s and 30s last year from a year ago is a significant factor that brightens the outlook for import brands,” he said.
Importers organize events to cater to high-end customers, from golfing to free tickets to operas, concerts and overseas trips. In golf-crazed Korea, automakers say hosting a golf event for customers once or twice a year has almost become a basic marketing essential. Volvo Korea, for instance, sends players to the Volvo Masters’ Amateur every April at a south Spanish resort.
Mercedes-Benz Korea will hold a golf training session for 30 children of its customers this summer at a five-star hotel. Last month, the German automaker invited 2,000 customers to an opera by a world-class singer at the Sejong Center for the Performing Arts in central Seoul.
Each quarter Audi Korea opens a wine school, where experts from a French winery give lectures to customers who bought Audis. GM Korea operates a gourmet club, picking 10 buyers of its Cadillac sedan each month for a meal at a fancy restaurant that includes a conversation with the chef.
“Import automakers try to expand their customer base through VIP marketing. That is a key difference from domestic carmakers,” said Jeon Yeong-seon, head of the Auto Culture Research Institute. “But holding car-riding events for the public or developing social contributions is more desirable in the long-term.”
Importers last year sold 40,530 units, a 31-percent jump from a year earlier. Their market share of 4.2 percent in the Korean car market, as well as the sales volume, topped previous records. Combined sales totaled 2.5 trillion won ($2.6 billion), also a record.
Industry sources say combined net earnings of import carmakers here last year are estimated at 100 billion won.
Leading brands such as Toyota Korea and BMW Korea had net profit of more than 20 billion won.
Sources say automakers send more than half of net earnings every year to their home countries. The cash that top brands, including Toyota, Benz and BMW have sent home so far has outpaced the expenses of their launches in Korea.

By Kim Tae-jin JoongAng Ilbo [spring@joongang.co.kr]