Kia 2006 Annual Report Download - page 45

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Sales Strategy
Domestic Business
The 2007 outlook for the domestic market is far from strong due to lackluster consumer confidence level and stagnant employment level. But the upcoming
presidential election brings the hope of better times ahead. The political climate is set to change and will undoubtedly focus on stimulus measures to get the
economy roaring ahead again. The demand for new cars replacing a large number of superannuated vehicles is forecasted to rise. The change in presidents that is
set to take place will likely bolster consumer confidence in the second half of the year.
Kia has announced that 2007 will be the ‘Year of Domestic Sales Innovation’. We will throw our weight behind expanding our domestic market share. Kia intends to
focus promotions on our New Opirus (‘Amanti’ in some markets) - the No.1 large-sized passenger car in Korea. And we hope to see an uptick in our RV sales, since
they were selected as the most satisfying RVs in the 2006 NCSI(National Customer Satisfaction Index).
Analysts anticipate that demand for passenger cars will grow in 2007. Kia intends to secure market share in the sub-compact segment by expanding the sales of
Pride (‘Rio’ in overseas markets; the highest-ranking model in the sub-compact segment - J.D. Power 2006 IQS) and Morning (‘Picanto’ in overseas markets).
Furthermore, an improved 2007 Lotze (‘Optima’ or ‘Magentis’ in overseas markets) is set to hit the market in April and help to increase our domestic sales. We plan to
fortify our brand recognition with New Opirus through continued test-drives, ceremonial vehicle offers to many events, which is expected to pick up our sales.
In the RV segment, sales promotions will center on the LPI model version of the New Carens (‘Rondo’ in some markets), which is gaining popularity for its lower fuel
price and alluring design. And a newer LPI version of the Carnival (‘Sedona’ in some markets) is scheduled for release in October of 2007.
In the area of light commercial vehicles, we will work hard to maintain our existing loyal customer groups and convert potential customers by highlighting our
Bongo Truck. Advertisements will promote Bongo Truck’s excellence in delivery service businesses. Sales promotion will bring out the brand value of Bongo Truck.
We also plan to strengthen our corporate image through sales promotions that illustrate how we create customer loyalty through ‘Before Service’ programs. These
promotions will target lifetime customers and will be aimed to create replacement demand.
Additionally, Kia will conduct differentiated sales promotion events linked to various cultural performances, as well as collaborative marketing efforts with domestic
oil refineries and department stores. We will also offer leisure and educational camps for our customers.
While focusing our brand identity on the concept of ‘Exciting & Enabling’, all of us at Kia are committed to building our reputation through superior products and
services.
Overseas Business
We have set our 2007 export goal at 921,000 units (KD excluded), a 5.7% rise over 2006.
Despite the many challenges we face head, Kia is committed to delivering superior value through our entire chain of operations. With determined efforts to localize
management practices in each of the regions that we operate, Kia believes there is still plenty of room for growth. We can and will strengthen our sales and
marketing capabilities. We want to exceed the expectations of every person or family that is investing in Kia.
To achieve the target that are in place, we aim to increase the number of overseas dealers from 3,864 as of the end of 2006, to 4,008 by the end of 2007. We will
cultivate an environment in which the most professional dealers thrive. Dealerships are the heart line to our customers: every car owner deserves the best possible
experience, from the moment they step onto a Kia dealership lot.
Our marketing teams are excited about the upcoming launch of the cee’d, a model to be mass-produced at the Slovakia plant. We believe expanded advertising &
sales promotions will create even higher level of passion for our key models including the New Carens (‘Rondo’ in some markets) and Sportage. We will be actively
involved in all major auto shows and dealer-related events to share ‘Kia Vision’ with both dealers and individual customers.
In the US we will continue advertising the Rio - the highest-ranking model in the sub-compact segment, according to the J.D. Power 2006 IQS. To address the issue
of a further potential slowdown in the US market, Kia will revamp various dealership programs to improve the quality of sales and service among our dealers. The
integrity of our dealerships is the beacon from which customer loyalty flows. Plans are also underway to leverage a more diversified marketing campaign through
NBA sponsorship. And we will further improve our IQS scores.