6. Saudi Arabia Auto Industry SWOT
Strengths:
• The regional economy is liquid with petrodollars. High business confidence and
increased disposable incomes provide a favorable background for the
automotive sector.
• Saudi Arabia is the largest importer of cars and automotive parts in the Middle
East.
• The recent oil price boom has boosted growth in the non-oil sector and
infrastructure is now much improved.
• A large and growing local population means solid domestic demand for goods,
services and infrastructure in spite of the global macroeconomic crisis.
7. SWOT
Weaknesses:
• There is no local production of passenger cars and only a small number of
commercial vehicles are assembled locally.
• The domestic market is largely dependent on international car manufacturers
for the style and design of autos and its profitability is hostage to the demands
of those major suppliers.
• Dependence on oil means growth, exports and government revenue remain
highly vulnerable to shifts in world oil prices.
• The private sector is dependent on expatriate labor, reflecting a shortage of
marketable skills among nationals and a high unemployment rate among Saudi
citizens.
8. Opportunities
• Trade liberalization between the Gulf Cooperation Council (GCC) and the
EU will open the Saudi market to more European imports.
Confidential
9. Impact Of The Economic Crisis In Middle East
Confidential
10. Automotive Financing
Auto finance covers around 75% of the value of total sales in the Gulf region,
where automotive sales amounted to around 1.1mn units in 2007. With a
higher proportion of premium brands than most developed markets, the
value of the automotive finance market in the GCC was worth up to
US$30bn. Car purchases are also on the rise and corporate fleets are
expanding fast, with the market driven by high population growth and
rising income levels. Increased bank liquidity related to oil revenue has
fuelled the rise in car loans, with banks willing to lend on very easy terms
and at highly competitive rates. Dealers have agreements with banks to
facilitate car loans.
Confidential
11. After-Sales Business
With competition between rival carmakers and dealers increasing
as more firms look to bulk up their presence on the large and
lucrative Saudi market, more attention is being paid to after
sales services, which had not always kept pace with the
increasingly sophisticated market. After-sales is seen as a key
area in which dealers can boost their value-added offerings.
Confidential
12. External challenges
• Japan Earthquake
• Chinese invasion “price war”
• Expansion of regular competitors “Toyota and
Nissan
• Legal and political challenges “Saudization”
• Restricted area “Riyadh city”
• Mono-brand “only Isuzu
• Mono-category “commercial vehicles”
Confidential
14. Japan Earthquake
• Time : Friday 11 March
• Place: Japan North East
• Events:
– Earthquake 9 degree on Richter scale considered to be
the most violent recorded one in Japan since 130 years
and 4th strongest worldwide.
– Tsunami waves as a consequence to the earthquake hit
and consecutive earthquakes.
– Nuclear power planet were affected and explosions were
monitored with dangerous nuclear pollution emission.
15. Consequences of Japan Earthquake
• By Wednesday 16th of March afternoon, the Japanese National Police
Agency reported 3,771 deaths. Another 8,181 people are missing and 2,218
were injured.
• The International Nuclear and Radiological Event Scale -- or INES -- ranks
incidents from Level 1, which indicates very little danger to the general
population, to Level 7, a "major accident" with a large release of radioactive
material and widespread health and environmental effects.
• Japanese stocks rebounded Wednesday, with the leading stock index
recovering nearly 6% from a two-day plunge. The Nikkei 225 index, the
most prominent measure of Tokyo market stocks, ended up 489 points, or
5.7%.
16. Expected effect on Isuzu and AUM
Business
• Human and material resources are deeply affected in all Japan specially
east and north regions.
• Nuclear power planet damage is affecting electrical power supply for many
regions in Japan.
• Already Isuzu management in Japan announced shut down for business on
level of production and shipment till other announcement.
• On level of trucks from Isuzu Japan only 250 vehicles will be arrived in
March till reproduction time.
• On level of D-Max, although it is produced in Thailand, parts supply from
Japan is stopped that will stop production in Thailand within 2-3 months.
• Our inventory is 1982 vehicles.
• Estimated time for Business process continuity for AUM till next July on the
current sales figures.
17. Internal challenges
• Quality of people.
• Materialistic attitude.
• Packages and benefits
• Cooperation with other sister companies “IT slow
response”
• Communications
Confidential
47. 2011 marketing strategy outlines
• Monitoring expenses to maximize the profitability through:
o Integrating online with offline marketing activities.
o expanding our e-marketing activities (banner advertising - Google Adwords camp.)
o approaching different vendors (new suppliers for promotional items)
o Monitoring gift distribution (providing valuable gifts to fleet customers via name list
request)
• Achieving Market share of 55% in central region at 2011 through:
o Isuzu at your place project.
o Corporate Social Responsibility program (traffic manner awareness campaign)
o increasing SOV and SON
o Diesel concept building activities.
o Focusing on CRM implementation
Confidential
48. 2011 marketing strategy outlines
• Maintain and increase our customers loyalty through:
o Traffic manner campaign.
o AUMSC training waves for different levels.
o ISUZU branding activities.
o promotional activities.
• Increase accessibility through:
o New sales office.
o Expand Target Audience via online channels.
o Isuzu at your place project
Confidential
49. 2011 Sales strategy outlines
• Increase total sales by 10%:
o Open new sales office in IC2 ( industrial city 2).
o Developing the governmental sales ( by using the Demo D-max )
o Increasing the heavy duty truck sales, and disposal of 2009 stock
• Keep minimum 8% GP through:
o Give priority to margin over volume sales.
o Improving retail sales share from total sales.
• Developing Daily and weekly Sales Reports .
o Daily monitoring using sales reports from S.force to S.supervisor, &
Weekly from S.Supervisor to S.Manager.
Confidential
50. 2011 Sales strategy outlines
• Strictly monitor operating cost at budgeted level through:
o Manage inventory levels between 2.2 to 3 months sales.
o Review and approve cost allocations.
Confidential
51. 2011 after sales strategy outlines
• Reduce back jobs from 2% to 1.5%.
o Train technicians to diagnose and fix the vehicle right first time
o Improve quality control process.
• Increase labor sales amount from SR- 3.39m to 4.14m by 2013.
o Initiate routine and maintenance packages with customer at the point of vehicle sale.
• Increase service and parts sales.
o Mobile workshop.
• Maximize vehicles retention from 350 V /M to 450 V/M
o Communicating warranty coverage and importance of periodic maintenance
with our customers at sales point and during first Maintanance.
Confidential
52. Basic Calculation for weight
Model : D-MAX Single Cab without rear body (Cab-Chassis)
GVW : 2,750 kg ---(1)
Kerb weight : 1,425 kg ---(2) (Figure on catalog)
Passenger weight : 250 kg ---(3) (3 passengers with 80kg/man)
Rear Body weight (tentative) : 200 kg ---(4) (Just tentative weight)
Fuel weight : 70 kg ---(5) (Full refueled)
Net Payload for Bottles : 805 kg = (1)–(2)–(3)–(4)–(5)
Weight of one water bottle is less than 20kg (18.9 L + plastic case), so
Maximum loading quantity will be 40 bottles.
Body 200kg
Bottles 805 kg
53. 20 bottles in one floor.
2 floors 40 bottles.
2,400 mm
1,720 mm
Apx 900mm
300 mm
500 mm
Bird View
Side View
Frame Body for Water Bottles
55. Bird View
[Option 1] [Option 2]
Option 1 can accommodate more bottles, but it will be over-loaded (2 floors 50 bottles)
Option 2 seems to be suitable, in terms of the number of bottles (2 floors 40 bottles)
(REF) Study for Water Bottle Layout
56. Al Manhal Water Factory (Mar.30th)
Hiace in Al Manhal Water Factory. All models are with DSL engine / MT, without ABS/Airbags.
They have 200 units in Riyadh (400 u’ in KSA total), but there are some stand-by vehicles.
Body is well branded for Al Manhal (or Nestle) product. They have role of running ads also.
Bottles are located on the floor, but it can carry 50 bottles in one floor. If 2 layers, it will be 100
Bottles maximum. However their payload is only around 1t, it will be much over-loaded.
They increase rear leaf spring by themselves.
Stand-by vehicles
Nestle brandingAl Manhal branding
Increased leaf spring
Half floor 25 bottles
57. Al Manhal Water Factory
[Loading Layout for Hiace (inside the van)]
2,930 mm
1,545 mm
Tire House
Tire House
Around 45 bottles
on one-floor
58. Al Manhal Water Factory
[Loading Layout for Hiace (inside the van)]
2,930 mm
1,545 mm
Tire House
Tire House
1st layer : 45 bottles
2nd layer : 40 bottles
Total : 85 bottles
1,700 kg loaded !
: 2ne layer (on top of 1st layer)
59. Al Manhal Water Factory
Consideration :
1. The fact is that Al Manhal is satisfied with Hiace is true, and Hiace itself is actually
good and well designed vehicle. However, we have a chance to penetrate.
2. Our advantages are :
(1) Stability during driving With bottle fixed cage-body.
(2) Price Depending on the cost of body.
(3) Safety D-MAX is bonnet type, while Hiace is cab-over. And D-MAX has
option of ABS/Airbag also.
(4) Special designed body It can be specialized. For example, we can provide
body type which can carry bottles and machines together with.
(5) Work efficiency Easy to load-unload body (side opened shutters)
(6) Fuel Economy Fuel tank of D-MAX is 76L, while Hiace has 70L only.
etc…
We can find more, if we compare the specs in details.
3. Our disadvantages are :
(1) Loading capacity But Hiace’s case is just over-loading. It will cause non-safe
situation. And I wonder if they really need 70-80 bottles in one-time.
Next step will be a discussion with Body Maker who can make this kind of special body.
61. 2011 marketing strategy outlines
• Monitoring expenses to maximize the profitability through:
o Integrating online with offline marketing activities.
o expanding our e-marketing activities (banner advertising - Google Adwords camp.)
o approaching different vendors (new suppliers for promotional items)
o Monitoring gift distribution (providing valuable gifts to fleet customers via name list
request)
• Achieving Market share of 55% in central region at 2011 through:
o Isuzu at your place project.
o Corporate Social Responsibility program (traffic manner awareness campaign)
o increasing SOV and SON
o Diesel concept building activities.
o Focusing on CRM implementation
Confidential
62. 2011 marketing strategy outlines
• Maintain and increase our customers loyalty through:
o Traffic manner campaign.
o AUMSC training waves for different levels.
o ISUZU branding activities.
o promotional activities.
• Increase accessibility through:
o New sales office.
o Expand Target Audience via online channels.
o Isuzu at your place project
Confidential
63. 2011 marketing strategy
modifications
• Focus on AUM branding.
• Control expenses.
• Customer retention.
• Maintain customer loyalty.
• More focus on after sales department.
• Maximize ROI and undergo investment
enhancement tactics.
• Integrate all marketing communication tools.
Confidential
64. • SA - 25,731,776 population (2010)
• 9,8 Millions Internet users as of June/10, with 38.1% penetration
rate, with double digit growth every year.
– At year 2000 internet users at Saudi Arabia was 200,000 which represent 0.9 %
• High integration in Social Media market
– 2,575,740 Facebook users on August 31/10, 10.0% penetration rate.
Confidential
65. "It may not always be profitable at first for businesses to be online, but it is
certainly going to be unprofitable not to be online."
Esther Dyson
Confidential
66. Digital Marketing Activities
1. AUM website renovation.
2. Establish AUM presence in social media networks.
3. Email marketing campaigns.
4. Developing online event management to be integrated into
coming offline events.
5. Developing first online marketing campaign strategy.
Confidential
67. It is not about only creating a website, we are building our web
presence through the integration of the new version of the
website and the social media networking.
AUM has started its travel from a physical showroom and has
reached to its current destination of virtual showroom,
enabling a faster, professional and wider reach in much
economical way.
Building the new version of AUM website
68. Website Statistics
• No. of generated requests: 124.
• No. of visits: 1172 visit.
• No. of page views: 8846 pages
• No. of pages per visit: 7.55 page
• Bounce rate: 8.53%
• Avg. Time on site: 05:31 min.
Confidential
73. Establish AUM presence in social media networks.
The importance of digital media marketing has proven itself as
an essential part of a business and as a fast mean of
transferring information.
Confidential
74. Facebook Fan Page enables us to Interact with our Customers and Prospects
Post Views: 12,755
Daily Photo Views: 409
Daily Video Views: 163
External referral from Google: 874
76. Confidential
Flickr is an online system that provides an
affordable way to store and manage photos, as
well as share them with the world.
Our photo stream on Flickr:
http://www.flickr.com/isuzusaudi
77. Email marketing Campaign
Confidential
Objectives of AUM monthly newsletter
• Expand customer database.
• Increase brand awareness, and
communicate special offers and
promotions.
• Overcome obstacles for easy reaching
target consumers
• Target the specific segment of consumers
with the right message.
• Direct qualified traffic to AUM website for
further action.
80. 2010 Major challenges
• CRM Associated technical problems.
• Lack of accurate database.
• Unfamiliarity of the sales team with the newly applied CRM system.
• Lack of linking and cooperation between sales team and other
departments.
Confidential
82. Marketing Activities for Q1
• D-max leasing campaign for fleet and retail customers
– For all D-Max models (from dd/mm to dd/mm )
– Xx Insertions in Riyadh, Jazeera and Al Iqtsadeia newspapers.
– In Cooperation with Arabic National Bank with the following terms:
• 2.99% interest rate.
• No down-payment.
• No Admin fees.
84. D-max Café-Mobi. campaign for retail
customers:
• For all D-Max models (from dd/mm to dd/mm )
• Street-Mobi. In XX Café, XX Café and XX Cafe
• In Cooperation with Arabic National Bank with the
following terms:
– 2.99% interest rate.
– No down-payment.
– No Admin fees.
Confidential
85. N-Series January Campaign for fleet and retail
customers:
– For all N-Series Models (from dd/mm to
dd/mm).
– XX insertions in Riyadh, Jazeera and Al
Iqtsadeia newspapers.
– With a gift free oil and filter for 50,000 Km
from our workshop.
Confidential
86. 0% interest rate campaign
Confidential
Different marketing channels
One Campaign
92. • during this project high level of promoters visited 1500 medium and small companies. Promoters distributed our
branded bags containing D-Max catalouge, simple gift and flayer with different message according to customer
targeted segments;
• for medium companies, message of 50% leasing campaign with AlYousr in one face and on the other face free oil
exchange to announce and support our Malaz workshope in addition to industrial office announcement and finally
online-offline integration to generate updated data base for our e-marketing activities.
• for small size companies the free oil and online - offline integration wes replaced by english translation of the
leasing offer as these segment is buying used vehicles with the same price of new vehicle first installment of our
leasing campaign. and many of them are not arabic and they own old vehicles that are not target for our
workshope in the current stage.
• I hope that I succeeded in integrating direct marketing with other used marketing communication tools which are
exihibition in malls and advertising in newspaper and others in addition to utilising for the first time online - offline
integration in our activities. and to achieve that
Confidential
93. campaign objectives
• offer maximum support to sales department and generating new hot
leads.
• focus more on after sales department through generating hot leads
and announcing for long term relationship.
• target virgin segment of small companies with more customized
leasing program.
• synergize different marketing approaches to maximize ROI.
• link AUM with Isuzu as an authorized dealer.
• keep AUM on top of prospects mind for future business.
• build AUM goodwill
• use innovation and modern approaches to maximize marketing
efficiency.
Editor's Notes
As the main OPEC swing producer, the kingdom is in a strong position within the cartel.
Overall, the GCC market is a strong one for vehicle sales, and has been less hard hit than others in the Middle East and beyond. An affluent, rapidly growing population and a sophisticated consumer profile are all strengths.
Link it to new lease campaign
“TELL ME AND I'LL FORGET; SHOW ME AND I MAY REMEMBER; INVOLVE ME AND I'LL UNDERSTAND.”
"The Internet is not just one thing, it's a collection of things - of numerous communications networks that all speak the same digital language." Jim Clark
Online event management.
Preparing for the first online marketing campaign to be launched through the second quarter.
Common Internet Advertising Terminology:
Impressions: The number of times an internet ad is displayed.
Clicks: Number of times users have clicked on an internet ad
Unique user reach: Number of unique users an internet advertising campaign has reached (different from impressions as one unique user may be delivered several ad impressions during a campaign).
Click through rate (CTR): Percentage of users who have click on an internet ad. This is the metric commonly used to measure initial effectiveness of creative concepts & ad placements. An average CTR is 0.20% but this varies by creative size (a text link for example will have a much lower CTR while a large format banner will have a much larger CTR). Eg. 50 clicks from 10,000 impressions = 50/10,000 = 0.5% CTR.
