Intensifying Industry Competition: Domestic Lubricant Enterprises Win the Market with Brands

As China's lubricant market gradually opened up, foreign lubricant companies entered the country one after another to grab a share of this enormous market, and Chinese and foreign companies became locked in fierce head-on competition. In that contest, domestic lubricant brands represented by Kunlun have won market recognition on the strength of a solid brand image.
Chinese and Foreign Brands in Fierce Battle
In 1992, China's lubricant market began to open to the outside world, becoming the earliest sector of China's petroleum and petrochemical market to do so, which prompted foreign brands such as Shell, ExxonMobil, BP, Fuchs and Total to pour into China. In 2005, China's refined oil retail market was formally opened to foreign participation, and the oil majors stepped up their investment in the Chinese market, particularly in lubricants.
At the same time, China's sustained and rapid economic growth brought prosperity to the automotive industry and directly caused a surge in market demand for lubricant products. China has now overtaken Russia to become the world's second-largest lubricant consumer after the United States, with annual demand of 4 million tonnes, and as vehicle ownership keeps rising, that demand continues to climb.
Faced with huge market demand, domestic and foreign companies have pulled out all the stops, from improving product performance, raising technological content and refining services to changing packaging, making acquisitions and building plants. Their strategies differ, but the ultimate aim is the same: to expand market share, especially in the highly profitable high-end segment.
Domestic Enterprises Win Through Branding
In this competition, domestic enterprises have come to a profound understanding that a brand is a symbol of a company's overall strength and an intangible asset that can bring higher added value; to expand market share, they must intensify brand building.
Brand consolidation has been an important step in the brand building of China's leading enterprises, and Kunlun has led the way in this effort. Kunlun's brand consolidation began in 2002 and concluded successfully in 2005, bringing all of PetroChina's lubricant operations under the Kunlun umbrella and ultimately forming Kunlun's "Tian" (Heaven) brand group, which forcefully strengthened the Kunlun brand image while allowing each sub-brand to target different markets and improving the adaptability of Kunlun products.
In addition, Kunlun rapidly raised the influence of the Kunlun brand through a series of marketing initiatives. In 2003, Kunlun bought out the advertising slot for the Shenzhou V mission, taking CCTV's "first bid" crown; in 2004, it won the naming rights to CCTV's Olympic Gold Medal Table and became the designated oil for the Antarctic expedition team's icebreaker; in 2006, it sponsored the China-ASEAN International Car Rally and supplied the designated oil for the race; in 2007, it formally signed with the NBA's Houston Rockets, becoming an official partner of the team of Chinese player Yao Ming. Kunlun also sponsored the national Top Ten Good Samaritan Drivers award for five consecutive years... Through this series of brand-building actions, Kunlun quickly conveyed its caring philosophy and outstanding product performance to consumers, deepening their awareness of the brand. The influence and market share of the Kunlun brand rose substantially.
It is understood that through brand building, domestic brands' share of the market, especially the high-end market, has risen steadily, breaking the "80/20 rule" of the lubricant market: domestic brands' share of the high-end market has increased greatly, and consumer loyalty to domestic brands has risen sharply. Brands are becoming the magic weapon with which domestic enterprises win the market.