Kia Australia’s new chief operating officer is set to take the South Korean brand in a new product-focused direction as it seeks to increase its market share.
Speaking with Australian media in Sydney today, Damien Meredith, a nine-year veteran of sister brand Hyundai, admitted that Kia needed to lift its brand profile and stop focusing on price as a way of getting sales.
“We need to move away from being on sale all the time.” Meredith said.
Kia will focus its future marketing efforts, which have had a budget increase of around 20 per cent, on product rather than pricing.
“Our unique offering is fantastic product, design and Australian [specific] set-up,” Meredith said. “We haven’t expressed that to the consumer but we will going forward.”
Meredith said previously “everywhere people use to look we were on offer” but that there’s “no doubt” Kia could sell on product rather than price when asked about the brand’s ability to move away from being price-focused.
Kia currently commands just under three percent market share in Australia with sales having stagnated over the past few years – unlike Hyundai, a brand that has seen consistent growth through very similar product, and now claims a market share more than three times that of Kia.
But despite the similarities, Meredith intends to differentiate Kia with more focus towards a younger audience.
“The difference between Kia and Hyundai is we want to be youthful and Hyundai probably want to be a little bit more mature.”
“We have to show in our communication and in our total brand situation that we are about youthfulness. We have to differentiate ourselves quite significantly I think, in terms of what’s happening to number one to nine player because last month we finished number 10 [on the sales chart].”
Kia’s goal of reaching around five per cent market share in the coming years is not intended to come at Hyundai’s cost, however, with struggling Japanese brands such as Honda and Mitsubishi more in the company’s crosshairs.
“My focus will be taking market share from the other 88 precent of the market where Hyundai and Kia haven’t got.”
In other markets the split between Hyundai and Kia sales is roughly 66:33 in Hyundai’s favour, yet the Australian market sees that skew around 75:25 and that’s a statistic Meredith is aiming to improve.
Kia aims to have a model in the top five best sellers list in each of the segments it competes. A key focus is the struggling Cerato small car, which Meredith says may soon get a new variant with a 1.6-litre direct-injection petrol engine with a more affordable price but still high levels of specification to help increase volume.
Kia currently has 122 dealers in Australia, with the great majority being multi-franchise businesses. Interestingly, the brand has a higher retention rate than Hyundai.
The South-Korean brand is currently researching the idea of having a seven-year warranty to further differentiate itself from other brands.