rural marketing of hero motors

About Hero• “Hero” - Munjal brothers

(1956) - Hero Cycles

• Established in 1984 as the Hero Honda company, India

• World's largest manufacturer of two - wheelers, based in India

About Hero• Three manufacturing facilities

based at Dharuhera and Gurgaon in Haryana, Haridwar in Uttarakhand, and Mangli near Ludhiana

• Vision is to see mobile and empowered India

• Mission is to become a global enterprise fulfilling its customers' needs and aspirations for mobility, setting benchmarks in technology, styling and quality

"The majority of India lives in rural areas and the government is pumping in a lot of money through various programmers. Hero Honda is focusing a lot on rural markets. Going forward, a substantial industry growth is expected to come from these markets.”

- Pawan Munjal, MD and CEO, Hero Honda Motors Limited, in May 2009

Rural Marketing strategy

Har Gaon, Har Aangan

Har Gaon, Har Aangan (Cont.)• Free service and check-

up camps• Consultations for

obtaining driving licenses

• Safe riding educational programs

• Health check- ups and awareness camp

• "Sikhao Baliye"

Rural vertical

• Rural vertical in 2007 to focus on• Product development• Consumer understanding• Marketing• Distribution• After-sales service

Market Research

• Under the rural vertical, they started collecting a lot of data at rural touch points

• Many of their dealers are now meeting• Sarpanches• Headmasters • Aanganwadi • Workers• Opinion makers to understand the rural consumer better.

• 1,00,000 of 6,00,000 villages in country.

• Penetration in Rural Market- 10%

• 500 Sales Representatives to meet potential customer (local people as sales executives )

• Average of 16000 bikes per month. ( sales )

Contd………!

Contd…..!

• These representatives have been given work tasks and not sale targets - they need to meet potential customers and opinion leaders in villages.

• To strengthen their network in rural areas, the company started sales, servicing and spare part outlets in small towns and villages across India.

Suitable Products• The most successful product is SPLENDOR in

rural market and the company kept on focusing on upgrading the models so, then they later came up with SPLENDOR PLUS and SPLENDOR NXG, SPLENDOR PRO which provided extra features and the consumers were satisfied

“The rural market is the right strategy for Hero as the penetration in these markets is low,”

Umesh Karne, Analyst ,Brics Securities Ltd.

Brand Hero

• Honda has been accepted by people because its strong brand image and product quality

• The punch line of Hero gives a emotional touch to customers “Desh Ki Dadkhan”

• Now “Hum Mein Hain Hero”

4 A’s of Hero

• Acceptability (Product)• Strong brand image and product

quality• Most fuel efficient bike on Indian

roads• Preferred by daily users (utility as

well as looks)

• Affordability (Price)• Cheapest motorcycles in India• Easy installments and loan facilities

• Awareness (Promotion)• 500 sales rep for “Har Gaon Har Aangan”• Free service camps every year• Advertisements in TV, newspapers, magazines etc

4 A’s of Hero• Availability (Place)• 3 plants• 3000 customer touch points• 5000 dealership plus sales service outlets

Promotion• Mapping the demographic

landscape to formulate region-specific modules to tap customers at a very local level

• Leverage regional festivals such as Pongal and Onam in the south, Gudi Padwa in Maharashtra, Durga Puja in the eastern region , Dhanteras and Diwali in the north region

Promotion (Cont.)

• Skits and Dramas

• Village haats and mandis are also being targeted to reach customers

• Tie-up’s with new partners, including local cooperative banks and financing units to have a robust financial model and promotions

Rural Expansion Strategy

• Started Social Development activities : – Employment generating program– Adult Literacy Program– Rural Health Project– Public Amenities– Road Safety Program

• With an indirect vision to create animage in Rural India

Hero’s Strategy

Hero’s Strategy (Cont.)

• Tie up with State bank of India to help Uttar Pradesh farmers

• Similar tie-up with Punjab State Cooperative Bank

Conclusion

• Hero has generated over 40 percent of sales from rural areas

• Increase in market share in the coming years

• Focus is on reducing maintenance cost and increasing fuel efficiency

THANK YOU

Out of Clutter find SIMPLICITYFrom Discord find HARMONYIn Middle of Difficulty lies OPPORTUNITY