Are China’s Electric Vehicle Brands Ready to Set the New Experience Standard?
A Case Study on Customer Experience Performance and Opportunities for Growth in the Chinese NEV Market
The Context
The Chinese new energy vehicle (NEV) market has rapidly become one of the most competitive in the world. Recently, many brands have engaged in aggressive price wars, slashing prices to gain market share and attract attention. However, as the era of price competition begins to wane, the market is poised for a new phase of competition centered around customer experience (CX). This shift presents a unique opportunity for brands to differentiate themselves by delivering exceptional customer experiences. The market’s key challenges include a lack of systematic methodologies to enhance CX and the complexity of managing interactions across multiple sales touchpoints. Furthermore, the target consumers—primarily young, well-informed, and demanding individuals—are driving the need for more personalized and engaging experiences.
The CXG Approach
Reshaping the Customer Experience in NEVs
Our methodology was designed to capture a comprehensive view of the customer experience in the new energy vehicle (NEV) market, focusing on offline in-store touchpoints. Participants from our CXG proprietary database of luxury CX Evaluators engaged in a shopping experience, reflecting their typical behaviors when considering a vehicle purchase:
- In-Store Interaction: Participants visited the NEV brands’ experience centers, interacting with brand advisors and exploring the vehicles on display.
- Advisor Engagement: They evaluated the quality of interactions with brand advisors, assessing their knowledge, communication skills, and ability to address customer inquiries.
The study encompassed 120 in-store visits, with a balanced gender representation (50% Female, 50% Male) and a focus on key consumer segments (13% Gen Z, 73% Millennials, 13% Gen X/Boomers). Conducted over two months (April – May 2024), the study targeted four luxury NEV brands—one American and three Chinese—providing insights into how these brands perform in a highly competitive market.
CXG Advocacy Index
Measuring the Power of Recommendation
A crucial component of our CX measurement is the CXG Advocacy Index, a proprietary metric that evaluates a brand’s ability to generate positive word-of-mouth, effectively transforming satisfied customers into brand ambassadors. For this study, we posed a key question: “Based on your experience with the brand advisors in the experience center, how likely are you to recommend it to a colleague or a friend?”
The findings revealed: Only 45% of customers were likely to share a positive word of mouth, indicating a considerable gap compared to the luxury retail industry benchmark of 60% in China. This result highlights the need for brands to improve the quality of their in-store interactions to enhance customer satisfaction and loyalty.
The Outcome
Key Insights for Future Success
The study highlighted several key insights into the behaviors and expectations of NEV consumers in China:
Smart Technology Attracts Consumers: The primary consumers of NEVs, particularly those aged 24 to 40, are digital natives prioritizing smart technology features over traditional vehicle attributes like engine performance or emissions. These consumers view their vehicles as extensions of their smart lifestyles, with seamless connectivity and intelligent configurations being top priorities.
Consumers May Know More About Cars Than Brand Advisors: These consumers’ information-savvy natures mean they are often more knowledgeable about NEVs than the brand advisors themselves. This presents a challenge for brands to ensure that their advisors are not only well-informed but also capable of engaging with highly knowledgeable customers on an equal footing.
Omni-Channel Experience is Crucial: In an increasingly digital world, younger consumers rely heavily on online channels for information and decision-making. From reading car reviews to exploring financing options and vehicle configurations via mini-programs, the influence of online touchpoints is undeniable. To meet these consumers’ expectations, brands must offer a seamless omnichannel experience that integrates online and offline interactions.
In Conclusion
Closing the Gap to Meet Market Standards
Our study highlights three critical areas where new energy vehicle (NEV) brands can improve to elevate their customer experience and meet—or even exceed—market benchmarks. Focusing on Proactivity, Connection, and Inspiring interactions, brands have a unique opportunity to drive meaningful change in the customer journey. Here’s a closer look at the current performance, industry standards, and target benchmarks for the top five players in the NEV market:
Opportunity 1: Proactivity
Proactivity involves leading the interaction, offering guidance, and taking responsibility for the entire customer experience. In our study, 58% of evaluators felt that advisors demonstrated proactivity during their interactions. However, this falls short of the luxury industry benchmark of 73% and is significantly lower than the 84% achieved by the top five NEV players. By adopting a more proactive approach, advisors can transform passive engagements into purposeful and memorable experiences that build trust and satisfaction.
Opportunity 2: Building a Connection
Establishing a genuine connection goes beyond knowing a customer’s product preferences; it involves understanding their individual needs and aspirations. In our study, 63% of evaluators felt that the advisors successfully built a connection, which is close to—but still below—the luxury industry benchmark of 67%. The top five players, however, reached 83%. Brands that prioritize client-centric conversations and ask questions beyond the transactional can unlock deeper engagement and a stronger emotional bond with their clients.
Opportunity 3: Inspiring Customers
Inspiring customers is essential to fostering brand loyalty and driving purchase confidence. Only 48% of evaluators reported feeling inspired by their interactions, far below the luxury industry benchmark of 62% and the top five players’ benchmark of 77%. Our study found that customers who felt educated and inspired were 93% more likely to have a positive overall experience and feel confident in their purchase decisions. This indicates a clear opportunity for brands to craft experiences that not only inform but also captivate and inspire customers.
By focusing on these three areas, NEV brands can close the gap with market leaders, creating impactful customer experiences that not only meet but exceed expectations.
CXG is your partner in this transformation. We offer comprehensive services and solutions tailored to elevate your brand’s customer experience across all touchpoints. Contact us today to learn more about how we can help your brand succeed in the evolving NEV market. If you are interested in the full study, please reach out to us by filling the form below.
