Will NIO’s Newest Marketing Tactic, the NIO EP Club, Help or Hurt its Brand Image?
Recently, the Chinese new energy vehicle company NIO (蔚来) has created the ultimate high-end social club in China – the EP Club. A whopping 10 million yuan (around 1.6 million US dollars) can buy you a seat at the table. The company’s goal is to become “The It Brand” in the domestic EV market and for NIO vehicles to be seen as a status symbol. What better way to build brand status than by creating a car owner community where members are either rich or …. richer.
However, the rules for getting into the EP Club seem a bit like multi-level marketing, causing some people to poke fun at the brand. Let’s take a look.
You need to help NIO sell 25 vehicles to join NIO EP Club
Recently, a salesperson at one of NIO’s stores shared that when a customer has purchases, repurchases, or recommends others to buy a NIO, that customer will get NIO points. When the points have reached a certain level, NIO will recommend the customer to enter the high-end EP Club.
Doesn’t sound too complicated. However, the caveat is, just how many NIO vehicles does a customer needs to purchase or refer others to buy?
On July 22, a NIO spokesperson told media outlet Red Star Capital Bureau that, according to the data from February this year, current members of the EP Club on average have purchased/helped sell 25 NIO vehicles. The spokesperson went on to say that, “Some owners have sold and purchased more than 160 cars.”
Based on the average starting price of NIO at 400,000 yuan (62k USD), if the average car owner bought/sold 25 cars, then the average EP Club car owner has driven 10 million yuan (1.6 million USD) in sales for the company. In other words, if you want to enter the EP Club you have pay more than 10 million yuan to buy NIO vehicles or created more than 10 million yuan in revenue for NIO.
What are the benefits of joining this “high-end community”?
According to NIO’s official introduction of the club, members of the EP Club can enjoy EP9 (the company’s crown jewel race car) driving experience, get formula-E racing tickets, join overseas ‘study’ tours, and business resource sharing. However, many members believe that EP Club is more like a “tour group” of the wealthy and powerful.
In November last year, many social media influencers shared EP Club’s trip to Lijiang, in Yunnan Province. According to one blogger, in addition to club members, NIO also invited some media outlets to join the event.
After arriving in Lijiang, the members dressed in formal clothes to attend the dinner on the first day, watched some members perform and CEO Li Bin also attended the dinner.
The activity on the second day was to climb the Yulong Snow Mountain in the morning and in the afternoon, members did some activities in the ancient city of Lijiang. In the evening, they held a martial arts-themed cosplay (role playing). Li Bin also dressed up and took a group photo with the members.
According to the Blogger, members only need to buy their own plane tickets, while the hotel and event expenses are all covered by NIO.
A member of the club also published a video revealing more details about the EP Club’s trip to Lijiang, including staying in a five-star hotel with gorgeous view, an EP9 track day driving experience and an interview with the CEO Li Bin. In the video Li Bin said: “the EP Club is a gathering of NIO’s most die-hard users.” Notably, he said the word users, not fans.
Is the NIO EP Club worth it?
NIO CEO Li Bin once bluntly said that buying NIO vehicles is not just buying a car, but “a ticket to a new lifestyle.”
From very early on, Li Bin learned from the success of Starbucks that no matter how advanced the Internet is and how developed e-commerce is, people’s inner demand for social interaction will not decrease, and they are willing to pay for services beyond the functionality of the product.
Another aspect of this is the people in this group are either wealthy or well-connected. So, for some, this group isn’t just a “tour group” – it is more like a Country Club. The only difference is Country Club is a lot cheaper.
The resources from social connections formed at the EP Club may allow some to gain more wealth and connections, so the 10 million yuan may be well worth it.
But some netizens have reacted unfavorably to information about the club, saying that NIO is not an EV manufacturer but a multi-level marketing (MLM) company. Others have said it seems like a high-end social networking company where the membership fee is cars.
But this isn’t the first time NIO has been called an MLM company, the brand has been dealing with this nickname for several years now due to its ongoing referral incentives and the natural passion its owners have for their vehicles. NIO’s response? “These types of rumors exist, mainly because people don’t have a deep enough understanding of our brand.”
