A Star Is Born For Chinese Drivers - Mercedes-Benz Entering Outbound Luxury Tourism Market

Jan 19 2014, 4:32pm CST | by

ch hTo the surprise of many observers,  Mercedes-Benz announced during a press conference in Shanghai the establishment of the “Mercedes-Benz Travel” brand through an exclusive partnership with HH Travel, the high-end travel brand of Ctrip International. The move marks Mercedes-Benz’s official entry into the Chinese premium outbound travel market as the first automaker to offer travel solutions together with a dedicated cooperation partner in the Greater China region. Mercedes-Benz Travel is positioning itself as providing specially-engineered travel design, high quality of trips and unique Mercedes-Benz highlights. Itineraries will only be announced next month, but Mercedes-Benz Travel promises to introduce products for Chinese sophisticated premium travel customers which combine carefully selected locations with a well-balanced itinerary featuring regional, theme-based and event trips with a focus on Europe as the main destination, including special topics such as ladies-only trips, summer camps, and education trips, as well as German engineering trips for the technically-minded, including visits to the Mercedes-Benz Museum in Stuttgart.

Using the existing high-level network and contacts, travelers are to be taken to unusual places, but also to classical highlight destinations with a different spin. Customers will meet people and make experiences that are out of reach for other travelers.

Through the establishment of Mercedes-Benz Travel, Mercedes-Benz is adding another dimension to the brand in China  which is meant to underline that it also embodies diversified and passionate lifestyles, which are in China more often associated with its German rivals BMW and Audi. This approach will be helped by the partnership with HHTravel, which has established itself as a major player in the premium tour segment.  China is the starting market to enter the travel industry for Mercedes-Benz but if the initiative proves to be successful, the concept could be extended to other tourism source markets.

Mercedes-Benz is among the first non-tourism brands which try to leverage their brand value for the profitable luxury tourism market in China in a systematic way. In a country with only very few distinctive tour operator brands, dominated by large state-owned companies like CITS, CTS, CYTS which offer almost identical products and compete mainly on price, this might not be a bad business plan. TUI, Europe’s biggest tour operator, shied away from using the outbound license granted to its daughter TUI China in 2012, as in China nobody knows the brand and the money needed to change that seemed to be already earmarked to prop up the faltering key markets closer to home. Mercedes-Benz on the contrary only has to convince Chinese affluent travelers that good car-makers can also be good travel service provider.

The author has been involved in market research activities of both Mercedes-Benz and TUI for the Chinese outbound market.

Source: Forbes Auto

 
 

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