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Why SAIC Motor's Business Model is so successful?

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SAIC Motor’s Company Overview


SAIC Motor Corporation Limited is a Chinese State-owned automotive design and manufacturing company headquartered in Shanghai, China, with multinational operations. A Fortune Global 100 company and one of the "Big Four" State-owned Chinese automakers the company had the largest production volume of any Chinese automaker in 2014 making more than 4.5 million vehicles. Its manufacturing mix is not wholly consumer offerings, however, with as many as 1.000.000+ SAIC passenger vehicles being commercial vans.

http://www.saicgroup.com/

Country: Shanghai

Foundations date: 1955

Type: Public

Sector: Industrials

Categories: Automotive


SAIC Motor’s Customer Needs


Social impact:

Life changing: self-actualization

Emotional: design/aesthetics, badge value, attractiveness, provides access, rewards me

Functional: saves time, connects, reduces effort, avoids hassles, quality, variety


SAIC Motor’s Related Competitors



SAIC Motor’s Business Operations


Add-on:

An additional item offered to a customer of a primary product or service is referred to as an add-on sale. Depending on the industry, add-on sales may generate substantial income and profits for a firm. For example, when a customer has decided to purchase the core product or service, the salesman at an automotive dealership will usually offer an add-on sale. The pattern is used in the price of new software programs based on access to new features, number of users, and so forth.

Affiliation:

Commissions are used in the affiliate revenue model example. Essentially, you resell goods from other merchants or businesses on your website or in your physical store. You are then compensated for referring new consumers to the company offering the goods or services. Affiliates often use a pay-per-sale or pay-per-display model. As a result, the business can access a more diversified prospective client base without extra active sales or marketing efforts. Affiliate marketing is a popular internet business strategy with significant potential for growth. When a client purchases via a referral link, the affiliate gets a portion of the transaction's cost.

Customer loyalty:

Customer loyalty is a very successful business strategy. It entails giving consumers value that extends beyond the product or service itself. It is often provided through incentive-based programs such as member discounts, coupons, birthday discounts, and points. Today, most businesses have some kind of incentive-based programs, such as American Airlines, which rewards customers with points for each trip they take with them.

Digital:

A digital strategy is a strategic management and a business reaction or solution to a digital issue, which is often best handled as part of a broader company plan. A digital strategy is frequently defined by the application of new technologies to existing business activities and a focus on enabling new digital skills for their company (such as those formed by the Information Age and frequently as a result of advances in digital technologies such as computers, data, telecommunication services, and the World wide web, to name a few).

Ingredient branding:

Ingredient branding is a kind of marketing in which a component or ingredient of a product or service is elevated to prominence and given its own identity. It is the process of developing a brand for an element or component of a product in order to communicate the ingredient's superior quality or performance. For example, everybody is aware of the now-famous Intel Inside and its subsequent success.

Make more of It:

The business invests time and money in developing in-house expertise and development that may be used both internally and outside to sell goods or services to clients or third parties. AWS was created to meet Amazon's cloud computing requirements. They quickly discovered that they could offer their services to end-users. At the moment, AWS accounts for about 11% of Amazon's overall income.

Integrator:

A systems integrator is an individual or business specializing in integrating component subsystems into a unified whole and ensuring that those subsystems work correctly together. A process is known as system integration. Gains in efficiency, economies of scope, and less reliance on suppliers result in cost reductions and may improve the stability of value generation.

State-owned:

As rivals or subjects of study, Chinese businesses' emergence on the world stage necessitates or creates a new category of business models: state-owned enterprises. These enterprises typically do not exist for profit but rather to offer critical goods and services to society that cannot be supplied economically by established firms. This model is characterized by fixed pricing, monopoly access to consumers, an advantage in exploiting resources, minimal or no tax obligations, and recurring financial losses.

Reverse engineering:

It is a legally sanctioned technique of duplicating a technology in which, rather than beginning from scratch, one starts with an existing product and works backward to determine how it works. Once the product's basic principle or core idea is established, the next stage is to replicate the same outcomes using other methods to prevent (legally prohibited) patent infringement. The cost of manufacturing is significantly lowered.

Experience selling:

An experience in the sales model describes how a typical user perceives or comprehends a system's operation. A product or service's value is enhanced when an extra customer experience is included. Visual representations of experience models are abstract diagrams or metaphors derived from recognizable objects, actions, or systems. User interfaces use a range of experience models to help users rapidly comprehend what is occurring in the design, where they are, and what they may do next. For example, a software experience model may depict the connection between two applications and the relationship between an application and different navigation methods and other system or software components.

Long tail:

The long tail is a strategy that allows businesses to realize significant profit out of selling low volumes of hard-to-find items to many customers instead of only selling large volumes of a reduced number of popular items. The term was coined in 2004 by Chris Anderson, who argued that products in low demand or with low sales volume can collectively make up market share that rivals or exceeds the relatively few current bestsellers and blockbusters but only if the store or distribution channel is large enough.

From push to pull:

In business, a push-pull system refers to the flow of a product or information between two parties. Customers pull the products or information they need on markets, while offerers or suppliers push them toward them. In logistics and supply chains, stages often operate in both push and pull modes. For example, push production is forecasted demand, while pull production is actual or consumer demand. The push-pull border or decoupling point is the contact between these phases. Wal-Mart is a case of a company that employs a push vs. a pull approach.

Licensing:

A formal agreement in which the owner of the copyright, know-how, patent, service mark, trademark, or other intellectual property grants a licensee the right to use, manufacture, and sell copies of the original. These agreements often restrict the licensee's scope or area of operation, define whether the license is exclusive or non-exclusive, and stipulate whether the licensee will pay royalties or another kind of compensation in return. While licensing agreements are often used to commercialize the technology, franchisees also utilize them to encourage the sale of products and services.

Reseller:

Resellers are businesses or individuals (merchants) that acquire products or services to resell them instead of consuming or utilizing them. This is often done for financial gain (but could be resold at a loss). Resellers are well-known for doing business on the internet through websites. One instance is the telecommunications sector, in which corporations purchase surplus transmission capacity or take the call from other providers and resell it to regional carriers.

Technology trends:

New technologies that are now being created or produced in the next five to ten years will significantly change the economic and social landscape. These include but are not limited to information technology, wireless data transmission, human-machine connection, on-demand printing, biotechnology, and sophisticated robotics.

Supply chain:

A supply chain is a network of companies, people, activities, data, and resources that facilitate the movement of goods and services from supplier to consumer. The supply chain processes natural resources, raw materials, and components into a completed product supplied to the ultimate consumer. In addition, used goods may re-enter the distribution network at any point where residual value is recyclable in advanced supply chain systems. Thus, value chains are connected through supply chains.

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