The Ferrari Way

Current CEO at Ferrari, China

Why is this interview interesting?

  • Difference between Chinese and Western consumer behavior and psychology
  • How Ferrari curated the buying experience from showroom to vehicle delivery
  • The Ferrari philosophy and brand equity management
  • The advantage of leveraging F1 for commercial products
  • Challenges and complexities of operating in China
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Executive Bio

Giuseppe Cattaneo

Current CEO at Ferrari, China

Giuseppe is the Current CEO at Ferrari, China and has over 25 years experience working in China. From 2004-9, he was CEO of Pirelli’s China Division before being promoted to CEO of APAC in 2009. Giuseppe then joined Ferrari as President and CEO of Far East Asia in 2013 before rejoining Pirelli as CEO of APAC for another three years in September 2014. Giuseppe has recently rejoined Ferrari in 2020 with full P&L responsibility of the China business. Read more

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Interview Transcript

Can we start by describing the difference in the Chinese versus the Western consumer, in purchasing luxury vehicles?

It’s a huge difference, actually. The difference is not really between the Chinese and the West. It’s more about developing countries and developed countries. I think China is, to a certain extent, partly a developing country, so there is still not full recognition of certain iconic brands; at least what the Western world considers iconic brands. Their approach to the brand is a bit less emphatic. They take the brand, they use it. Sometimes it looks good and they keep it, tick the box. Done; what’s next? There is multi-experiencing of different brands. There is no historical heritage. There is no loyalty. At least, there was no loyalty or heritage. Now it is changing somewhat.

In practical terms, what does it mean? It means that I know that to accomplish my success, I need to have a Ferrari in the garage. I buy the Ferrari, I put it in the garage and I forget about it. Maybe next time, I will buy a McLaren and the time after, I will buy a Rolls Royce, if I can afford it. There is no real loyalty. The first round of purchasing was done absolutely in that way. Now, the ripple chasing is the rule of the game. When you sold your luxury item, for the first time – and it could be true for a car, a watch, a yacht or something else – an item that is a historical brand and is very iconic in the Western world that some people wanted to have it, then they bought it. After that, there is the repurchase process.

The repurchase process is not automatic because people tend to have the world range of iconic brands, before they go back and fall in love with one brand. This is, I think, the real challenge. This challenge is the challenge everywhere in the world but in China, particularly, it is to get the loyalty of the client. Get him or her to repurchase your product. Once they become a repeater, in that moment, you start to establish loyalty and you can leverage the worldwide tools to retain the clients. The real key issue is the repurchase.

How do you approach driving repurchasing by customers?

Customer satisfaction with the first purchase is very important. The product you are selling should be consistent with the iconic heritage of the brand. This is very important and it’s true for everyone. If your brand, if your product, at the end of the day, is not consistent and is not up to the standard that the people expect, the risk is that they will not repurchase. It’s absolutely necessary not to underestimate the quality that the Chinese market want to receive and the ability to perceive quality from this new client. In certain cases, it’s even easier to sell to well-known and continual repeater clients because they are more accepting of certain imperfections. But when you sell to a very demanding, first-time client, you need to sell to a level of perfection – a perceived one, but also an actual one – that must really be up to the reputation of your brand. In that case, you will have a high percentage that will come back. This is so important; do not underestimate the ability to evaluate quality, by Chinese consumers.

How is the expectation of the product and service different in China, versus the West?

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The Ferrari Way(May 6, 2020)

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