"Audi products are about pride of ownership"

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: Martin Birkner, vice-president, marketing of German luxury carmaker, Audi India, has been engaged in formulating the marketing strategies for Audi since its launch in India. Forty-year-old Birkner believes that the charm for luxury products and particularly for high-end luxury car brands is on the rise in India. The company is, therefore, working to expand its base in India by extending the dealer network from seven exclusive Audi dealerships to at least 10 before the year-end. In a freewheeling interview to FE’s Ruchi Kapoor, Birkner talks about the potential of luxury cars in India and unveils the company’s plans for the country.

What does Audi stand for in India? How do you differentiate it from your peers?

That’s quite clear. Our claim is “Vorsprung durch Technik”—that means “advancement through technology”. That’s what Audi is all about and that is what drives our company. You can find that in the product, the design and in the way we try to communicate the sophistication and innovation of an Audi car.

Audi is a luxury brand—it is sophisticated and the accent is on perfection. It’s also got an aspiration value. When you see an Audi car, you will see it’s a bit different from other luxury brands. It’s about subtlety, it’s not showy, it’s a brand that focuses more on values and design. It is sporty and aggressive. In that sense, it is also aspirational.

How big is the market for luxury cars in India? What kind of feedback have you got about your product?

There are 250 thousand millionaires in the country. You can see there is a lot of potential in the luxury segment. The overall car market is also growing year on year. This year, the segment was roughly 4,500 cars and this is still less when compared to the actual potential in the country. People in India are just about entering the luxury segment, but they are already looking for alternatives to choose from. They want to see new brands, new statements and Audi makes a new and powerful statement in the luxury segment. We believe that Audi will be very successful.

What is the size of the luxury or premium car market in India?

The market in 2007 was roughly 4,500 cars, but there aren’t yet many makes in the country. But it’s getting bigger.

What is the profile of your target customer in India?

It is the elite of India. Our products start from Rs 25 lakh (A4) and go up to Rs 1.1 crore for A8. You can easily see that it is a luxury product and not everyone can easily afford these cars. As I have mentioned the number of the rich in the country is big and they are becoming more passionate about luxury goods in general and for luxury cars in particular. Our customers know what luxury is all about. Our products are not just functional; they are about pride of ownership.

What is your sales target in India?

For this year we have set a target of roughly 1,000 cars and for 2010 our target is 3,000 cars. Mind you, the cars are produced in India, in Aurangabad. We have started production of the A6 last year and by the end of this year we will start with the production of the upcoming A4 model, which will cost Rs 29 lakh onwards—a pretty attractive product, which we have already presented at the Auto Expo this year in Delhi. The car will hit the Indian roads middle of this year and will be manufactured in India by the end of this year.

How do you plan to advertise and communicate (your brand) in India? How much emphasis is being given to R&D?

For luxury goods one has to be very careful about what you do with the communication. For us it will be a targeted and focused communication. We don’t want to cover the whole country with our advertising. We will focus on our target group through highly sophisticated magazines. However, since we are new brand in the country, we have to improve awareness and announce that Audi is a successful player in the game. It’s always a task to find a balance between creating awareness and keeping a high profile. As a luxury brand you have to build up the image very carefully and treat it right.

Before coming to India we had to understand the market and the culture—to figure out ways to communicate to the target customer. We are doing more research and combining it with strategy. We are convinced because we find people who are looking for a luxury brand like Audi—they are looking for a German brand which stands for German values like technology, sophistication and design. Audi was launched in India in 2004. Now we to want to set up our headquarters in Mumbai and extend our dealer network. If you are close to a market you learn a lot more and you can adjust your strategies according to those learnings.

What is the crux of your marketing and advertising strategy worldwide? In India, will it be in line with the international one?

As a global brand you have to communicate at a global level. We have a global standard irrespective of time and place. That is because the people you are targeting travel worldwide and see the brand all over the world. If we communicate through different strategies in different countries our target customer will be confused. This is our task—to communicate and let the customer experience Audi as the most successful luxury brand.

Of course, we sometimes adjust our communication style according to the local needs and that’s exactly what we are doing here.

How would you describe the market for luxury cars in neighbouring countries like China?

The luxury market, in general, is growing worldwide. In Europe there is a sort of stagnation though. In the emerging markets in Asia, like India and China, the demand for luxury cars is quite high. In China, for example, we sold more than 100,000 cars in 2007—Audi being the most successful premium brand in that country. So you can see the potential. India, we anticipate, will have similar potential.

How do you plan to expand your base in India?