Online sales smart move for Jingdong, Mercedes

Xu Wei never reckoned that when she logged on to online retailer Jingdong Mall (360buy.com) to buy a longed-for smart car on Monday, the cute vehicles would already be gone.

"Bookings started at 10 am when I was away from my computer for a meeting. I never imagined that two hours later, no cars would be left," said the 31-year-old, who works in Harbin, Heilongjiang province.

Xu was one of the 17,200 Jingdong registered users who added the smart car to their watch lists since the joint campaign by Jingdong and Mercedes-Benz, a division of Daimler AG, began on Feb 10. Only 300 got lucky.

The success of the online sale also surprised Stefan Herbert, head of smart operations at Mercedes-Benz (China) Ltd.

"Far beyond our expectations, the 300 units of Pearl Grey limited edition smart cars were sold out within 89 minutes," said Herbert. "I originally thought it would be a great success if they could be sold out in three hours."

Herbert said that China was the only country where these special edition cars had been sold exclusively through an online retailer. "We got the largest portion of the total 1,200 units globally."

He added: "Another surprise is that the 300 orders came from all over China, not just first-tier cities."

"We prepared three days for the first trial of selling cars through our online store. The result shows that there is huge potential for online vehicle sales," said a Jingdong executive who would only give his surname as Wu.

"I believe that Chinese customers would prefer the low-cost online shopping experience even for vehicles, if there is a credible platform to provide high-quality products."

"The campaign has been an example of win-win cooperation between Jingdong and Mercedes-Benz," said Wu. "We're looking for more opportunities to make vehicles one of our online product categories, based on the experience of this smart sale."

The online sale of the Pearl Grey smart cars further validated the German luxury vehicle provider's marketing strategy in China. It previously set another record by selling 205 smart cars within four hours through group buying on Taobao, a Chinese online marketplace, in 2010.

Since the smart car entered the mainland in April 2009, China has become its third-largest market after Germany and Italy. Sales surged 180 percent last year to almost 11,000 units.

"We even saw a very exciting start of 1,443 units of smart sales in January, a dark month for China's vehicle market because of the two New Year holidays," said Herbert. "Growth of 340 percent meant that the monthly sales were almost equal to the full-year smart sales for 2009."

Herbert attributed the success of the smart vehicles to the company's targeted branding and marketing strategies.

"Smart's target audience is quite broad, ranging from first-time buyers of 18 to drivers aged 70, evenly split by gender," said Herbert. "So we need to tailor-make strategies and marketing campaigns for different target groups."