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Homework Lifan Case Study Essay

Question 1:

The Lifan company tries to sell their products very cheap to make it affordable for the people thus everyone. They probably don´t have the best quality but that´s not their designated strengths. They do not only sell motorcycles they also sell the engines for motorcycles. And beyond that the Lifan brand became also famous for manufacturing electrical goods, wine, mineral water, sport shoes, anti-theft doors etc. and so they created a brand image which is more famous in Vietnam than company´s like Honda. With this brand image they have the chance to sell completely different products than the products the company came up with.

This is not typical for a European company. They can do this because of low-cost production and low wages. And also the legal and government restrictions are lower in these countries so it´s easier to enter new markets with “new” products. Typical for western companies is that they try to focus and specialize on niche products and be the best in this certain market segment. Western Companies also try to first establish their products on the home market and export afterwards. The Lifan Company´s business behavior is risky because there were already other giants in the motorcycle market like Honda and Yamaha. But they saw their chance and they knew that the demand for motorcycles will rise.

Question 2:

The marketing management philosophy has to be different because people in western European countries see their motorcycles as a kind of a status symbol and with owning a motorcycle they also want to show their wealth. Also the quality is very important because people pay more money when they know that it is a product with high quality. But in China it´s more a vehicle to go from A to B. For Chinese people the price is relevant because they cannot afford an expensive motorcycle because their wages are relatively low and there are more poor people than rich people. Another thing is that there are already other strong competitors who are well established in the home market so they have to come up with something new or special.

So the marketing management philosophy has to focus on these attitudes of the people, they cannot use the same marketing techniques in both markets. The European and the Chinese consumer behaviors are really different. You cannot use the same commercial breaks or role models everything in marketing strategy has to be customized to the certain country or market because the cultural differences are huge especially between Asia and Europe. They should do multicultural researches and the entire research design may have to be different between the European countries to maximize the comparability of the results.

Question 3

The Lifan company should focus more on quality and service. Or they should find another advantage to attract European costumers. When it comes to automotives European costumers have a strong brand awareness and focus on quality and service because it´s a long-term investment for them. But the most important thing for the Lifan company is to analyze the market and the opportunities they have in this market. But not only the market should be analyzed also the costumers and stakeholders they are focusing on. Without knowing their future environment they will not succeed in the European market.

And they should also analyze their own strengths and weaknesses to improve or utilize them. Such as producing in their home country and not producing in Europe because it´s much more expensive. Or maybe do a joint venture to penetrate the foreign market and corporate with other firms to do well in this business. In general you should figure out the advantages and disadvantages of both cultures and try to use something of both to make the best out of it.


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