Shell Unveils Newly Launched Phoenix Strategy

Five years after the joint venture between Shell and Uniform Lubricants, the company with two lubricant brands started a new journey.

Not long ago, Shell Uniform (Beijing) Petrochemical Co., Ltd. (hereinafter referred to as Shell Uniform) completed a new round of personnel appointments. Its new head is Chen Cuiwei who has over 20 years of management experience in the construction industry. Joining Shell with Chen Cuiwei is the 22-year-old Zhai Zizi who has worked for Shell. He is the deputy general manager of Shell's unified market and strategy.

In fact, the oil market environment placed before Chen Cuiwei is not a smooth one. In the international market, the declining European markets and financial risks have made current Chinese companies’ export performance decline rapidly. Chen Tanchen, “This is a challenge for oil suppliers. This challenge will be in the second half of 2012. It gradually emerged."

In addition, the competition in the domestic lubricants market has become increasingly fierce. Not only are old and powerful competitors from home and abroad fighting fiercely, but some of the newer lubricant companies have also begun to grab market cakes. This kind of childbirth has been extended to the competition of channel terminals. Coupled with the proliferation of counterfeit oil in the domestic market, this has brought pressure to the oil companies to survive and develop.

In this regard, Chen Cuiwei’s idea is to look for opportunities in an economically bad environment. First of all, due to the stringent environmental conditions at home and abroad, some smaller lubricant companies have started to close down. "The rest are several relatively strong companies. This is also an opportunity. Under this background, how to attract customers, save production costs, and make themselves bigger will be the key to the success or failure of the future."

In addition, at present, China is already the world's second largest lubricants market, and it is already very close to the North American market, the world's largest market. “In the Chinese market, we can produce relatively good quality products at a relatively low cost. Therefore, our cost pressures and competition in the industry are fierce. These challenges have in turn aroused my interest and enthusiasm for the work.” Say.

In terms of specific tactics, it is clear that Shell and unified market positioning and sub-line operations are also important tactics for Chen Cuiwei’s use of soldiers.

In 2006, Shell, a multinational oil giant, and a privately owned brand of Lubricating Oil jointly entered into a joint venture. At the time, the unification of self-developed lubricants caused a shortage of crude oil supply, combined with the limited supply environment of domestic base oil, and faced many pressures such as the market and competing products. Uniform lubricants encountered bottlenecks.

As a result, Shell and Unity formed a unified Shell joint venture. Among them, Shell holds 75% of the shares. At the beginning of the joint venture, Shell and Unity made it clear that they should retain a unified lubricant brand, “a family of two brothers.” Shell must sign a five-year cooperation agreement with a unified senior management team. The personnel changes this time are carried out after 5 years.

The operational thinking of the new team is that, in accordance with Shell's main attack on international customers and high-end markets, the unified brand acquired by the company will focus on domestic and localized markets that require economic efficiency. In Chen Cuiwei's view, lubricating oil is a very real product. In industrial demand, as long as the standard is met, it does not require every customer to purchase cutting-edge lubricating oil products. It just happens to cover different markets with Shell.

Based on the clarification of the positioning of the two brands, the new team also proposed a new strategic plan for the development and promotion of corporate business from 2012 to 2015. It is called the “Phoenix Strategy” and is used as a unified strategy for the development of Shell in the next four years. Conduct business development and strategic layout.

In the channel terminal, Shell unifiedly established the “Development Committee” in the industry, mainly to solve the contradictions between distributors in the regional market. The main work is to help and promote the development of regional markets. Also joined the business training, sales methods, applications, etc., in order to enhance the dealer's market competitiveness. More importantly, it has changed the development model that has encouraged the nation to build stores and optimize channel integration.

According to Chen, at present, the dealer channel competition is very fierce. Therefore, it will be one of the efforts of Shell to enhance the competitiveness of Shell's unified market. At present, Shell has a total of about 1,000 dealers and has distribution networks in 30 provinces across the country. “We want to help our distributors continue their success and improve their capabilities. In addition, we must help them develop end-users, including 4S stores and designated repair shops. For these end-users, there will be a series of programs for market development.”

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