What is the Xu ZhanHai Matrix?
"Xu Zhanhai Matrix" is a business and product portfolio competition tool, this model will be a complete combination of growth strategy, competitive strategy, brand potential energy three aspects of the integration. In the process of practice, it is impossible for enterprises to decide on products and business combinations based on a pure financial model, but also to consider the direction of brand competition and overall competitive advantage.
Xu Zhanhai Matrix solves the problem of enterprise growth momentum, escorts the long-term growth of enterprises, and helps enterprises create the second and Nth signboards.
Through 3 years, more than 300 market visits, more than 600 case studies, and more than 900 days of brand research, we came up with the Xu Zhanhai matrix model.
The most unique independent car brand,
After ups and downs,
Witness the historical rise and fall of China's own brands
No matter how high the number of sales units of an independent car brand is and how amazing the model design is, a brand in China is always the most special in everyone's heart, that is, Hongqi.
In 1958, the first Hongqi car was born, the Hongqi brand itself represents multiple meanings, for Chinese, Hongqi is not only a famous car brand, but also a special symbol of the times, is a deep feeling and sacred memory. For FAW people, Hongqi is a strong responsibility and historical mission.
In August 1958, China's first self-owned brand car, Hongqi Car, was born in Changchun.
In September 1959, the first Hongqi sedan was sent to Beijing and became a parade car for the 10th anniversary of the founding of the People's Republic of China. Since then, the Hongqi car has always had special symbolic significance.
In the 1960s and 1970s, the Hongqi car has always been a banner of China's automobile industry.
Since the 1980s, "Hongqi" has continued to undertake the heavy responsibility of "national vehicle" while beginning the process of marketization.
In July 2017, Xu Liuping stepped down as chairman of Changan Automobile and went north to take charge of FAW. Subsequently, an unprecedented reform broke out at FAW.
On April 25, 2018, the Hongqi brand debuted independently at the Beijing Auto Show for the first time in its history, and the high-end B-class car Hongqi H5 was shockingly listed. Since then, the red flag has opened up a channel for rapid development.
On February 4, 2019, Hongqi HS5 made its first official debut at the 2019 CCTV Spring Festival Gala Jilin Changchun (FAW) Branch venue, and was officially launched during the 2019 Changchun International Marathon on May 26, 2019. Driven by these two cars, new Hongqi staged a miracle of 63 times sales growth in 4 years.
According to the data, from 2018 to 2020, the Hongqi brand sold 33,000, 100,000 and 200,000 cars respectively, and sales rose steadily. Sales for the full year of 2021 reached 300,000 units, up 50% year-on-year. Hongqi is constantly refreshing its best results.
The red flag is facing new energy changes
Is it a crisis or an opportunity
In 2021, China's new energy vehicle sales reached about 3 million, accounting for about one-seventh of the entire auto market, experts expect sales to reach 5 million in 2022, the historical trend of new energy has been unstoppable, in this case, the new energy market has become a must for the soldiers, whether it is independent brands or joint venture brands are striving to develop their own new energy vehicles, new energy vehicles are also the red flag brand must go to the blue ocean market, In the new energy market, Hongqi only has three models on sale, E-HS9, E-HS3 and E-QM5, and the sales of these three cars can only be described as dismal.
We are familiar with the Hongqi E-HS9, the cumulative output of 8438 vehicles in 2021, the cumulative sales volume of 5481, the cumulative production and sales rate of 64.96%. The backlog of nearly 3,000 vehicles can be said to be an achievement that cannot be taken.
Sales volume comes from online information collation
From January to December 2021, Hongqi E-HS3 sales were 1709 units, down 48.43% year-on-year. In the rapid development of the new energy market, the sales of E-HS3 can be described as sad, and because the Red Flag E-HS3 is mostly used in the field of shared travel, this also labels this car as an "online car", making many consumers prohibitive. For Hongqi, the loss is not only sales, but also lowers the brand potential.
There is also a car called the E-QM5, which has a very low starting price, only 122,800 to start. In 2021, the cumulative production of Hongqi E-QM5 was 23,353 units, the cumulative sales volume was 16,641 units, and the cumulative production and sales rate was 71.26%; The backlog of inventory reached 6712 vehicles.
Sales volume comes from online information collation
In 2021, the cumulative sales volume of Hongqi new energy vehicles in the whole year was 23,831 units, compared with the total sales of 300,000 vehicles last year, the sales volume of Hongqi new energy vehicles accounted for 7.94%, which is far lower than the national new energy vehicle market share of 13.4%. Even the 10.86% of Great Wall Motors is not a star and a half.
The historical trend of new energy is inevitable, the window period of new energy vehicles has arrived, why is the red flag that continues to shine in the fuel vehicle market so bad in the new energy market? How does Hongqi create brilliance in the competition of new energy vehicle market?
We used the Xu Zhanhai matrix model to analyze the Hongqi automobile product matrix.
We use the Xu Zhanhai matrix model to gain insight into Hongqi Automobile's growth strategy.
Xu Zhanhai matrix model analysis of Hongqi Automobile
Internal competition is a category that starts with a brand or can represent the brand in the customer's mind, and the internal line is the brand signboard business. Share products, sign products and image products are all internal products.
From the Xu Zhanhai matrix diagram of Hongqi Automobile, we can see:
Share products: Hongqi H9, Hongqi H9+, Hongqi H7, Hongqi HS7, Hongqi LS7, Hongqi E-HS3, Hongqi E-HS9, Hongqi E-QM5
Signature products: Hongqi H5, Hongqi HS5
Image products: Hongqi L5, Hongqi S9
1. Signature products
Hongqi H5: B-class high-end luxury car
• Published: April 25, 2018
• Price range: 145,800-190,800
• Model positioning: Class B
• Sales: As of June 2022, Hongqi H5's latest monthly sales volume was 3,970 units, and its cumulative sales in 2022 were 29,426 units.
For the new Hongqi, the Hongqi H5 is a representative product. As a grounded medium-sized family car, Hongqi H5, with its excellent comprehensive product strength and national pricing, contributed more than half of the sales of the Hongqi brand in 2018 alone, and the sales volume of the Hongqi H5 reached 20,825 units in 2018, accounting for 63% of the brand's total sales; By 2019, the annual sales volume of Hongqi H5 will be close to 50,000 vehicles, which is the first main force for the Hongqi brand to achieve annual sales of 100,000 vehicles; In 2020, hongqi H5 sales reached 61,862 vehicles, accounting for 31% of the brand's total sales. Even in 2021, when it has reached the end of the product life cycle, Hongqi H5 will sell 83,875 vehicles in 23,875 vehicles, accounting for about 28% of the brand's total sales.
Hongqi HS5: China's first luxury B-class SUV
• Published: May 26, 2019
• Price range: 183,800-249,800 yuan
• Model positioning: Mid-size SUV
• Sales: As of June 2022, Hongqi HS5 has 8,715 vehicles in the latest month, and cumulative sales in 2022 are 57,827 units.
After the launch of the high-end luxury and people-friendly mid-size car H5, Hongqi did not stop. In June 2019, Hongqi launched the mid-size SUV model Hongqi HS5, which is also the first SUV on the market of Hongqi, which is positioned as a mid-to-high-end SUV. Although compared with many autonomous mid-size SUVs, this HS5 with a starting price of 183,800 yuan is not cheap, but in fact the effect is surprisingly good. In the first year of the market, the hongqi HS5 sold 29,284 vehicles in 2019.
In 2020, Hongqi HS5 sold a total of 98,365 vehicles; Hongqi HS5 will sell a total of 131573 units in 2021. In January 2022, the sales volume of The Hongqi HS5 reached 24,451 units, becoming the first luxury high-end domestic SUV with monthly sales of more than 20,000 units in the domestic automobile market, ranking first in sales.
Signature Product Summary:
1, the choice of mainstream market, not limited to the category brand thinking, Hongqi's signature products H5 and HS5 are cars and SUVs, which is also the two largest markets in the automotive field, choose the big track to be able to produce a big brand.
2, relative to the national price, Hongqi H5 is not as high as the past Hongqi products are not grounded, nor is it blindly "cheap" like other independent brands. It should be said that Hongqi H5 has found a very suitable position between the joint venture brand and the independent brand, in fact, it has formed a certain price confrontation with the joint venture B-class car to a considerable extent.
The Hongqi HS5 of about 200,000 yuan is a nationalized price in the luxury SUV sedan. Because the Hongqi HS5 entry is the top match, the standard fixed speed cruise, front and rear radar, reversing image, the appearance of high-end atmosphere on the grade, can be called a national luxury car, directly hit the Audi Q5, drive out absolutely have face! Consumers put the Hongqi HS5 with audi Q5, Mercedes-Benz GRC, BMW X3 in the same order of magnitude for comparison, "Chinese luxury car brand", national price, who does not love it.
3. The new Hongqi signboard products start from the user, not from the enterprise. It can be said that the Hongqi H5 and HS5 are basically designed according to the idea of ordinary family cars. Although the shape is not so sporty or innovative, the style has obviously begun to pursue the direction of youth, movement and fashion.
2. Image products
Hongqi brand naturally has a unique brand potential, that is, the national luxury brand, Hongqi luxury car L5, the selling price of 7 million yuan a car is difficult to find, the aura is strong, the potential energy is not lost to Rolls-Royce.
Hongqi L5 is an E-class sedan independently developed by China FAW and the only E-class sedan of a Chinese brand so far. In January 2018, FAW Chairman Xu Liuping released a new Hongqi brand strategy, and at the same time released L5 for global users, opening high-end limited edition customization.
Although the Red Flag L5 has long been customized, but it is not something that can be bought with money, we all know that the purchase of the Red Flag L5 needs to pass the "strict review" of the Red Flag staff: 1. Have enough wealth 2. The background is clean enough 3. Have a certain influence. Judging from the known owner identities of Hongqi L5, they are film and television star Jin Dong, Cao Dewang, chairman of Fuyao Glass Group, and Wang Jianlin, chairman of Wanda. From this, car buyers need a high social status and social contribution, and at least an excellent positive image to become the owner of Hongqi L5.
Red Flag S9
The new Hongqi supercar S9 adopts the world's first V8T engine and three-motor hybrid technology, the total power of the system exceeds 1400 horsepower, the acceleration of 100 kilometers is less than 2 seconds, and the maximum speed is more than 400 kilometers per hour. The technical requirements of supercars are very high, and New Hongqi invests heavily in the development and production of S-class sports cars, which is based on brand potential and competitive strategy thinking. Although supercars are not mass consumer goods, the research and development and production technology of supercars represents the highest level of the automobile industry and can effectively enhance the potential energy of the brand. In the future, this kind of speeding energy research and development and production technology can also be applied to the production of civilian cars to promote the improvement of Hongqi national car technology.
Hongqi's image products have been very successful: Hongqi L5 has greatly increased the brand potential energy through "strict review", and the new Hongqi supercar S9 represents the highest level of the automobile industry and effectively enhances the status of the industry.
3.
Share of products
Hongqi's share products: Hongqi H9, Hongqi H9+, Hongqi H7, Hongqi HS7, Hongqi LS7, Hongqi E-HS3, Hongqi E-HS9, Hongqi E-QM5
Hongqi's share of products is divided into three categories:
The first category is a share product based on the signature product
In the field of cars, H5 is a signature product, and H7 and H9 are based on H5 share products.
In the SUV space, HS5 is a signature product and HS7 is a share product based on HS5.
The second category is a share of products based on different powertrains of a single model
For example, for H7, in addition to the fuel version, there is also a hybrid "H7 PHEV", and for H5, the hybrid "H5 PHEV" is also about to appear.
There is also a wrong share of products, that is, Hongqi's new energy E-HS3, Hongqi E-HS9, Hongqi E-QM5, the wrong new energy vehicles that should be used as an external line, as a share product.
Hongqi Automobile Inner Line Summary:
New Hongqi staged a miracle of 63 times sales growth in 4 years, in addition to the successful creation of signature products in the two mainstream models, and through the correct image products to create a great increase in brand potential, product changes are the key point of Hongqi's "outbreak", it successfully realized the transformation from official cars to civilians.
With the development of China's car technology, domestic cars are more and more recognized, followed by market changes and consumption upgrades, China's independent car brand high-end also ushered in the opportunity to rise, in recent years has begun to see results, Hongqi as a representative of independent car brand high-end car, in the strategy of nationalization through the price of the guidance, but also seized this wave of market dividends.
Another reason that has to be mentioned is the change in the internal environment of Hongqi, Xu Liuping took over the FAW Group. After Xu Liuping took over FAW, he did a lot of things about Hongqi. In particular, his statement of "if the red flag is not done well, I will resign with blame" has approached the military order. This is both your own determination, but also a clear expression of your own views to the team - don't hesitate, don't think so much, work hard to do a good job!
Chairman Xu Liuping's determination and driving force, coupled with the continuous enhancement of reliable products and brand potential, under this resonance, the "outbreak" of the new Hongqi fuel vehicle seems to be accidental, but it is actually an inevitability.
Hongqi Motors: Missing outer line
Outside competition is a new category that brands enter in order to enhance potential energy and cope with competition, while allowing brands to create incremental markets. Seed products, flame products and the second signboard are all outside products.
From the Matrix Diagram of Xu Zhanhai of Hongqi Automobile, it can be seen that Hongqi has no external line, although Hongqi has made new energy vehicles, but we have drawn it to the inner line, because Hongqi's new energy vehicles are all share-based products of the internal line, and are not based on external line thinking. Below, we will look at what is the new energy strategy of external line through the new energy strategy of BYD and GAC.
BASED ON THE EXTERNAL GROWTH STRATEGY AND FULLY EMBRACES NEW ENERGY
Let's first look at BYD's Xu Zhanhai matrix:
From the BYD product matrix, we can see:
Share products: other batteries, other consumer electronics, other semiconductor products
Signature products: blade batteries, mobile phone and computer parts, high-end IGBT power chips
Image products: solar energy storage battery, automotive intelligent system, motor drive three-phase full-bridge SiC module
Seed products: other marine series
Flame products: cloud rail, cloud bar, dolphin
The second sign: the Dynasty series
As can be seen from BYD's product matrix, BYD has developed a perfect external competition: rich seed products, flame products with certain users and potential energy, and the second signature product of the Dynasty series. BYD is a model of using new energy vehicles as an external strategy.
First of all, on April 3 this year, BYD Automobile officially announced that according to its strategic development needs, it will stop the production of fuel vehicles from March 2022, and all of its external products are new energy vehicles. It can be seen that BYD's determination of the new energy vehicle strategy will fully empower external new energy vehicles.
Secondly, it is not limited to models, from cars and coupes to various SUVs (compact SUV, medium and large SUV, small SUV), MPV; From passenger cars to commercial vehicles, BYD covers almost all mainstream models. BYD prices also cover most of the price range, from less than 100,000 to more than 300,000 have been covered, including in the luxury car market of more than 300,000, there are also 350,000 denza D9 in the impact.
In terms of sales, BYD also began to show the phased results of the external growth strategy of taking new energy as a new energy: in March, BYD's new energy vehicle sales 104878, breaking through the 100,000 mark. The flagship bydir Han sold 12,359 units; Tang 9625 vehicles; The Song family has 26,729 vehicles; The Qin family has 24,797 vehicles. Meta series, e family and dolphins all performed very well. In April, BYD Auto's monthly wholesale sales were 105,000 units, up 134.3% year-on-year, and the brand topped the sales championship position for the first time.
Based on the external line growth strategy, based on the synergy with the internal line, not limited to the model, and the comprehensive external line, BYD has entered the chinese passenger car head camp with the continuous rapid growth of new energy vehicles.
Based on its external growth strategy, GAC Aeon is leading the new forces of car manufacturing
GAC Aean, formerly known as GAC New Energy, is an automobile brand of Guangzhou Automobile Group Co., Ltd. GAC Aeon once defined the tonality of the brand as a new force in car manufacturing, which can be seen that GAC attaches great importance to the new energy vehicle track and regards Aeon as an independent brand entering the field of new energy vehicles.
Let's take a look at the product matrix diagram of GAC Passenger Cars (this matrix is for its own brand GAC Passenger Cars, which does not include GAC Joint Venture Vehicles):
It is worth mentioning that GAC Aeon was formerly known as GAC New Energy, and at the 2020 Guangzhou Auto Show, the GAC Aeon brand was officially independent, and it was renamed gac Aeon from GAC New Energy. The purpose of gac Aeon is to accelerate the external line building strategy of gac passenger cars' new energy and intelligent vehicle products, and once defined AEAN as a new car-making force, which shows GAC's emphasis and determination to embrace the new energy track.
Based on the external line growth strategy and entering the field of new energy with an independent brand, GAC Aeon is also not limited to models, but chooses the two tracks with the largest domestic market space, mainstream SUVs and cars, and also the nationalized price of new energy vehicles with 100,000-200,000 yuan in price.
The correct growth strategy has helped GAC Aeon to sell more than 10,000 units in April and break through sales in May to exceed 20,000 units.
Aeon, a new force for car-making, has also done a good job in sharing.
At present, AION has a variety of models such as AION S, AION LX, AION V, AION Y, etc., covering small cars, compact cars, medium-sized SUVs and other market segments, and the rich product types allow consumers to have more ample choice. Not only that, Aegean is also undertaking rich user needs through new versions, such as the 2022 GAC AION AION Y new 70 executive version and 80 executive version models.
Euler: Choosing non-mainstream markets and focusing on category innovation is destined to be a small and medium-sized brand
Based on the category innovation positioning of the women's car, Euler first set herself small. On August 20, 2018, Great Wall Motor Group officially released the independent brand of new energy vehicles, Euler ORA, which is the first independent new energy vehicle brand among China's mainstream independent car companies. Specially built for urban travel, the target user is the new urban youth, positioning is a car brand that loves women more.
First of all, the choice of small cars is a small track of category focus, and secondly, the positioning of cars that love women more makes Euler's market space narrower. All the brands that focus on the small track after subdividing the category do not end up well, such as the mobile phone's Duowei women's mobile phone is only a temporary hilarity, and the final outcome is tragic.
Euler did not build on the Great Wall Haval, or even learn from haval's successful experience in pricing. Haval's first choice was the SUV, a market that is continuing to rise, and secondly, Haval's pricing is about 100,000 SUVs, which is more affordable than other SUVs in the market. It is precisely because of the incremental market and the nationalized price point that Haval has achieved success and occupied the top spot in the SUV sales list for many years.
In 2022, Euler Motors, which should have been a continuous hit, experienced a decline in sales in February this year, with total sales plummeting to 6,261 units, down 52.7% month-on-month, and in April, Euler Cars sold only 5,474 units.
Red Flag Outer Line Summary:
Hongqi attached great importance to new energy in the early days, but treating new energy as a share product cannot really land and is not competitive. As early as the beginning of the H7 listing in 2014, there were plans to launch the H7 hybrid version in 2015, but in the actual landing process, there was no news, until July 2018, the H7 hybrid version was unveiled in everyone's vision.
The lack of external competitive strategic thinking of the red flag does not do new energy as an external line strategy, but as a share of products to do, does not fully embrace the determination of new energy, does not upgrade new energy vehicles to the strategic level, that is to say, the lack of external competitive strategic thinking is the most important reason for the setback of hongqi in the field of new energy vehicles.
In the next few years, the overall sales of Chinese automobiles to achieve rapid growth is not very likely, in the case of basic disk stability, every step of the development of new energy vehicles, is squeezing the living space of fuel vehicles. Although it took a lot of effort, the red flag is struggling in new energy, and if the new red flag cannot shine in new energy, it will not be squeezed by BYD and Wei Xiaoli.
Our advice to Red Flag:
1. Take new energy vehicles as an external competitive strategy, based on the external growth strategy, and fully embrace new energy.
2. Learn from the experience of Hongqi H5 and HS5's signature products, and quickly create a new energy signboard product in the field of cars and SUVs.
3. After creating a signature product, share it in a timely manner.
Hongqi will challenge the annual sales of 500,000 in 2022, and in today's shrinking fuel vehicle market and the rapid development of new energy, Hongqi's new energy vehicle strategy has a long way to go.
Hongqi brand is China's most historical high-end automobile brand, but also the first real sense of luxury brand in the lineup of independent brands, the unique historical background gives Hongqi's unique brand image and brand potential, it has witnessed the independent automobile brand from scratch, from mediocrity to excellent development process. With the important position of the Hongqi brand, the take-off of Hongqi Automobile will represent the rise of China's independent automobile brands and the prosperity of China's automobile industry.
Finally, we wish Hongqi a smooth realization of its goals and a better and better national automobile brand.
About the author
Qu Guoli: Head of Growth Strategy Business Unit, Project Director
Yang Zhongzhong: Senior consultant of growth strategy business unit, senior researcher of Xu Zhanhai Matrix Research
Editor: Liu Yue
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Help China's leading enterprises
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Xu Zhanhai Consulting, founded by "Mr. Competition Mr. Xu Zhanhai", created a new positioning theory in 2019, and the core consulting team has long served well-known brands such as Beijing Automobile, Foton Group, Jinmalang, Repeat Customer, Wang Li Group, Xiaomi Group, Wang Laoji, Six Walnuts, Mengniu, sina and so on.