-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
1/42
INTRODUCTION
Consumers play an important role in the economy. They from the largest
economic group in any economy. They are indeed considered the pillars of the
economy. Consumer behavior (CB) is at the core of the market behavior. CB
in relation to the products bought and sought factors like personality,
perception, attitude and reading on the one hand and the product, price, physical
attributes adjusting and social influence on the other, shape the behavior of
consumers.
Profile of the Automobile Industry-India
The automobile industry (AI) is a leading sector in economic development: its
most obvious benefit is its input in to the motor transport industry viz in the
ferrying of goods and people from one place to another in a more flexible and
very often more efficient manner than by other forms of transport. Since time
immemorial, man has been seeking means to transport himself and his
belongings and produce from one place to another in his quest for better and
cheap means of transportation or movement of persons and things. Since then,
different kinds and models of motorized vehicles swing the varied requirements
of diverse users are produced by many manufacturers throughout the world.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
2/42
Two Wheeler IndustryINDIA
India is the second largest manufacturers of two wheelers (TW) in the world. It
stands next to Japan and China in terms of the number of TW produced and sold
respectively. India is one of the very few countries manufacturing three
wheelers in the world. It is the worlds largest manufacturer and seller of three-
wheelers. Indias automobile sector consists of the passenger cars, utility
vehicles, and commercial vehicle, TW and tractors segment. The total market
size of the auto sector in India is approximately Rs.540 billion and has been
growing at around eight per cent per annum for the last few years. The growth
in automobile sales has been impressive for the past ten years since
liberalization began. The AI is fairly concentrated, as in most of the segments
two to three players have cornered a major chunk of the total sales. For
instance, in the TWs segment, the sales volume of Hero Honda (HH), Bajaj
(BAL) and TVS Motors constitute around 80 per cent of the total sales.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
3/42
OBJECTIVE OF THE PROJECT:-
The main objectives of the Project study are:
Detailed analysis of Automobile industry which is gearing towards international
standards.
To conduct market research with regard to two-wheeler automobile industry and
understand its marketing strategies.
Analyze the impact of qualitative factors on industrys and companys prospects
Comparative analysis of major tough competitor.
To understand the current trends in two-wheeler automobile industry.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
4/42
INTRODUCTION TO INDIAN AUTOMOBILE
INDUSTRY
Automobile is one of the largest industries in global market. Being the leader in product and
process technologies in the manufacturing sector, it has been recognized as one of the drivers
of economic growth. During the last decade, well directed efforts have been made to provide
a new look to the automobile policy for realizing the sector's full potential for the economy.
Aggressive marketing by the auto finance companies have also played a significant role in
boosting automobile demand, especially from the population in the middle income group.
A Nations economy is well known from its transport system. For instant and rapid growth ineconomy, a well-developed and well-networked transportation system is essential. As India's
transport network is developing at a fast pace, Indian Automobile Industry is growing too.
Also, the Automobile industry has strong backward and forward linkages and hence provides
employment to a large section of the population. Thus the role of Automobile Industry is very
essential in Indian economy. Various types of vehicles are manufactured by the Automobile
Industry. Indian Automobile Industry includes the manufacturing of trucks, buses, passenger
cars, defence vehicles, two-wheelers.
The two-wheeler manufacturing is dominated by companies like TVS, Honda Motorcycle &
Scooter India (Pvt.) Ltd., Hero Honda, Yamaha, Bajaj, etc.
The automobile industry in the country is one of the key sectors of the economy in terms of
the employment opportunities that it offers. The industry directly employs close to around 0.2
million people and indirectly employs around 10 million people. The prospects of the
industry also has a bearing on the auto-component industry which is also a major sector in the
Indian economy directly employing 0.25 million people.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
5/42
OVERVIEW OF TWO WHEELER SECTOR
Two Wheeler Industry
Indian two -wheeler contributes the largest volumes amongst all the segments in automobile
industry. This segment can be broadly categorized into 3 sub-segments viz.; scooters,
motorcycles and mopeds. In the last four to five years, the two-wheeler market has witnessed
a marked shift towards motorcycles at the expense of scooters. In the rural areas, consumers
have come to prefer sturdier bikes to withstand the bad road conditions. In the process the
share of motorcycle segment has grown from 48% to 58%, the share of scooters declined
drastically from 33% to 25%, while that of mopeds declined by 2% from 19% to 17% during
the year 2008-09. The Euro emission norms effective from April 2000 led to the existing
players in the two- stroke segment to install catalytic converters. All the new models are now
being replaced by 4-stroke motorcycles. Excise duty on motorcycles has been reduced from
32% to 24%, resulting in price reduction, which has aided in propelling the demand for
motorcycles.
Within the two-wheeler industry, motorcycle segment grew at a phenomenally high rate of
35% as against a deceleration of 3% for scooters and 27% for mopeds. In fact, motorcycle
has been taking away the share of scooters and mopeds in a 4.3 million two-wheeler market
and surging ahead with its market share of 68%. The increasing demand from semi-urban and
rural segments may have caused this positive shift towards motorcycles. Also, easy credit
coupled with low interest rate regime, constrained personal transport, increasing income
levels in middle class and higher aspirations of young people all seem to be the factors
responsible for such high growth in two-wheelers. The growth in two-wheelers has been
robust enough to counter the slowdown and other factors constraining the overall business
activity in the country. Also, rationalization of excise duty in the Union Budget 2002-03 had
a positive impact on the demand for motorcycles. We also expect the motorcycles to continue
to lead the two-wheeler segment like in all other Asian countries. Available forecasts suggest
that this trend would continue for another couple of years and the industry would record
nearly double-digit average annual growth up to 2006.
During the year, there have been important developments in two-wheeler industry. The
competition has strengthened though there are hardly any new entrants into the industry.
There is an increasing emphasis on price and this has led to cost cutting efforts all across the
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
6/42
industry, thereby, making the customer an ultimate beneficiary. The trend also saw
introduction of new motorcycles with capacity ranging from 100 to 180cc bikes. We
anticipate that many more new models will be launched during the year and provide
customers plenty of choice at competitive prices.
Businesses cannot consistently grow at 25-30 per cent. Each business has a tendency to taper
and plateau after attaining a particular size. An annual growth rate of 10-12 per cent over a
period of time is extremely healthy.
The TCS study rankings are conducted at the motorcycle segment-level to provide
comparisons among similar groups of motorcycles. Motorcycles ranking highest in their
respective segments for TCS are: Hero Honda CD100 SS (best standard motorcyclesegment); Hero Honda Splendor (best executive motorcycle segment); Bajaj Pulsar (best
premium motorcycle segment); and Royal Enfield Bullet Electra (best cruiser motorcycle
segment).
The feeling of freedom and being one with the Nature comes only from riding a two wheeler.
Indians prefer the two wheelers because of their small manageable size, low maintenance,
and pricing and easy loan repayments. Indian streets are full of people of all age groups
riding a two wheeler. Motorized two wheelers are seen as a symbol of status by the populace.
Two wheelers in India are the second largest producer and manufacturer of two-wheelers in
the world. It stands next only to Japan and China in terms of the number of two-wheelers
produced and domestic sales respectively. Indian two-wheeler industry has got spectacular
growth in the last few years. Indian two-wheeler industry had a small beginning in the early
50's. The Automobile Products of India (API) started manufacturing scooters in the country.
Bikes are a major segment of Indian two wheeler industry, the other two being scooters and
mopeds. Indian companies are among the largest two-wheeler manufacturers in the world. In
the initial stages, the scooter segment was dominated by API; it was later overtaken by Bajaj
Auto. Although various government and private enterprises entered the fray for scooters, the
only new player that has lasted till today is LML.
The motorcycle segment was initially dominated by Enfield 350cc bikes and Escorts 175cc
bike. The two-wheeler market was opened to foreign competition in the mid-80s. And the
then market leaders - Escorts and Enfield - were caught unaware by the onslaught of the
100cc bikes of the four Indo-Japanese joint ventures. With the availability of fuel efficient
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
7/42
low power bikes, demand swelled, resulting in Hero Honda - then the only producer of four
stroke bikes (100cc category), gaining a top slot.
The first Japanese motorcycles were introduced in the early eighties. TVS Suzuki and
Hero Honda brought in the first two-stroke and four-stroke engine motorcycles respectively.
These two players initially started with assembly of CKD kits, and later on progressed to
indigenous manufacturing. In the 90s the major growth for motorcycle segment was brought
in by Japanese motorcycles, which grew at a rate of nearly 25% CAGR in the last five years.
The industry had a smooth ride in the 50s, 60s and 70s when the Government prohibited new
entries and strictly controlled capacity expansion. The industry saw a sudden growth in the
80s. The industry witnessed a steady growth of 14% leading to a peak volume of 1.9mn
vehicles in 1990.
In 1990, the entire automobile industry saw a drastic fall in demand. This resulted in a
decline of 15% in 1991 and 8% in 1992, resulting in a production loss of 0.4mn vehicles.
Barring Hero Honda, all the major producers suffered from recession in FY93 and FY94.
Hero Honda showed a marginal decline in 1992.
The reasons for recession in the sector were the incessant rise in fuel prices, high input costs
and reduced purchasing power due to significant rise in general price level and credit crunchin consumer financing. Factors like increased production in 1992, due to new entrants
coupled with the recession in the industry resulted in company either reporting losses or a fall
in profits.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
8/42
Two wheeler fleet composition in India:-
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
9/42
STRUCTURE OF TWO WHEELER INDUSTRY
Mopeds:-
Over the last 15 years, mopeds contribution in overall 2-wheelers has declined significantly
and now it remains a marginal category with just one manufacturer for the product. Its
contribution in the 2-wheelers industry now stands at 5% and we expect that this segment
will continue to be marginalised. The only player in this segment is TVS Motor.
Scooters:-
Advent of fuel efficient motorcycles in the Indian 2-wheelers industry led to decline of
Scooters. However, over the last five years, it has made a recovery and is emerging as a niche
segment targeted towards women commuters. One of the reasons for this is the increasing
need of mobility for the women commuters especially in the urban areas is due to higher
number of college going girls and greater participation of women in urban work force. The
product itself has gone for a complete revamp and now this category mainly consists of
gearless products. This segment is now dominated by Japanese manufacturers with HMSI
having the leadership. HH, which is a late entrant in this segment, has also cornered a
sizeable market share in the scooter segment. Another development in this segment is the
launch of battery operated scooters. However, given the high replacement cost for the
batteries, this has remained a marginal segment.
Motor cycles and bikes:-
Executive Segment
Executive segment is the largest motorcycle segment and this is the stronghold of market
leader HH. Competitors have tried to challenge HH in this segment, however all such
challenges have fizzled out over time. With higher growth in economy segment, the
contribution of this segment had come below 50% in FY06. However over the last three
years, it has made a strong come back and now accounts for almost 60% of the motorcycle
share.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
10/42
Premium Segment
This segment was creation of HH with 'CBZ' And KARIZMA; however major boost to the
segment was given by BAJAJ through 'Pulsar' which has dominated the segment. HH has
remained a marginal player in this segment and one of the reasons for this is presence of
HMSI in this segment. This segment remains a small segment in the Indian market with
contribution of around 23% to the motorcycle industry. This is the performance segment and
customers pay a premium for the novelty. Hence constant upgradation in the product is a
requisite for success in this segment.
Usage Pattern of two-wheelers in India
Is quite different from other countries
Initial cost and fuel economy are highest priority.
Low maintenance costs are desired.
Small entrepreneurs and farmers conduct their business carrying loads.
Very limited usage for sports bike.
Indians prefer the two wheelers because of their small manageable size, low
maintenance, and pricing and easy loan repayments.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
11/42
Key players in the Two-wheeler industry:
Hero Honda motors ltd.
Bajaj auto ltd.
TVS motors company ltd.
Yamaha motors India
Honda motorcycle and scooters India
Motorcycles in India:
Bikes comprise a major segment of Indian two wheeler industry.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
12/42
Companies :
Hero Honda Motors Ltd (HHML )
Hero Honda Motors Limited was established in 1984, as a joint venture between India's Hero
Group (world's largest bicycle manufacturers) and Japan's Honda Motor Company. And
created the world's single largest two wheeler company and also one of the most successful
joint ventures worldwide. During the 80s, Hero Honda became the first company in India.Over 19 million Hero Honda two wheelers running on Indian roads today.
* Hero Honda CD Dawn
* Hero Honda CD Deluxe
* Hero Honda Glamour
* Hero Honda Glamour-Fi
* Hero Honda Karizma
* Hero Honda Passion Plus* Hero Honda Pleasure
* Hero Honda Super Splendor
* Hero Honda Splendor NXG
* Hero Honda CBZ X-Treme
Bajaj Auto Ltd Company:
Bajaj is the first Indian two wheeler automobile company in the market since 1945 with the
name M/s Bacharj trading corporation private limited. In 1959 M/s Bacharj trading
corporation private limited change its name as Bajaj Auto Ltd. Bajaj Auto obtains license
from the Government of India to manufacture two- and three-wheelers vehicles in 1959.
* Bajaj Avenger
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
13/42
* Bajaj CT 100
* Bajaj Platina
* Bajaj Discover DTSi
* Bajaj Pulsar DTSi
* Bajaj Wave* Bajaj Wind 125
* Sonic DTSi
TVS Motor Company :
TVS Motors is the third largest company in the two-wheeler industry with a market share of
16%. Infect, it is the only Indian company without a foreign collaboration in the two-wheeler
industry. When the company opted out of the collaboration with Suzuki in 2002, many
believed that TVS was headed towards extinction. But the company proved the doomsayers
wrong and came out with a very successful `TVS Victor'. TVS Motors Ltd. originally
incorporated in 1982 to manufacture two-wheelers in collaboration with Suzuki Motors of
Japan, TVS was one of the leaders in two-wheeler industry.
* TVS Apache
* TVS Centra
* TVS Fiero* TVS Star
* TVS Victor
Yamaha Motor India:
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
14/42
Yamaha Motor Corporation is the auto mobile company of Japan (1953) which works in
India since 1955 and providing latest technology in India from last two decades. Yamaha
Motor India was incorporated in august 2001 as a 100% subsidiary of Yamaha motor
corporation, Japan
* Yamaha CruxS
* Yamaha G5* Yamaha Gladiator
* Yamaha FZ 16
* Yamaha R15
* Yamaha Fazer
Honda motor:
Honda motors of Japan is not a new name in the two wheeler scenario in the country, they
were in a tie up with the Firodias owned Kinetic group. However in the late 90s they parted
ways after problems arose over issues like introduction of new models, advertising
expenditure, marketing strategies and other related issues. In the mid 80 Honda motors of
Japan joined hands with the largest bicycle maker of India the Hero cycles to create Hero
Honda which in a couple of decades or so have gone on to become the single largest
motorcycle company in the world. Though Honda has come on its own on the Indian market
yet it will be providing technological support to Hero Honda for the next ten years. Thus
presenting a unique situation in which the company will be in direct competition with the
company which it has been associated for nearly two decades. Honda Motorcycles and
Scooters India limited, a 100% subsidiary of Honda motor company Japan eventually entered
the Indian market with Honda Unicorn in 2004.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
15/42
* Honda Unicorn
* Honda activa
Now further the marketing strategies of HERO HONDA and its competitor
BAJAJ will be analyzed.
Market share of two wheeler automobile
sector
35.60% 27.50%
16%
7%4%9.50%
Hero Honda
Bajaj Motors
TVS Motors
YamahaMotorsHonda Motors
Others
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
16/42
HERO HONDA
The Company was Incorporated on 19th January,1984 at New Delhi as a joint
venture.
Today Hero Honda is the largest two-wheeler manufacturer in the world producing
more than 3 million units of two-wheeler per year.
The company's most popular model is the Hero Honda Splendour, which is the
world's largest-selling motorcycle.
Over 19 million Hero Honda two wheelers are on Indian roads today.
Hero Honda CD-100 is the first four stroke motorcycle to be introduced in India in100cc range.
During the fiscal year 2008-09, the company has sold 3.28 million bikes.
PRODUCT MIX
SCOOTER BIKE 100CC 125CC 150CC 220CC
PLEASURE CD 100
SPLENDOR
SPLENDOR+
PASSION
PASSION+
AMBITION
GLAMOR
CBZ
CBZ XTREME
KARIZMA
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
17/42
BAJAJ (COMPETITOR)
Established in 1945.
Started production of scooters in 1961 and became first two wheeler manufacturingcompany of India.
Bajaj Auto, is ranked as the world's fourth largest two and three- wheeler
manufacturer.
Bajaj Auto is Indias largest exporter of two wheelers.
During 2008-09, the company exported 772,519 two and three-wheelers recording a
growth of 25 percent over 2007-08.
Exports now constitute 37 per cent in volume terms and 35 per cent IN value of net
sales.
PRODUCT MIX
100CC 125CC 135CC 150CC 180CC 200CC 220CC
BAJAJ CT
100,
BAJAJ
PLTINIA,
BAJAJ
WAVE
DISCOVER,
BAJAJ
WIND,
BAJAJ XCD
PULSAR-135 PULSAR-150 PULSAR-
180,
AVENGER
PULSAR-200 PULSAR-
220
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
18/42
4 Ps OF MARKETING OF HERO HONDA :-
PRODUCT
Hero Honda, which has a technology tie-up with Japan's Honda Motors, was currently
discussing the feasibility of manufacturing scooters for the Indian market, Mr. Munjal said.
However, the company has a binding clause with Honda's scooter manufacturing Indian
subsidiary, preventing it from making scooters till 2004.
Hero Honda Motors, India's largest motorcycle company, has launched the premium segment
223cc motorcycle Karizma priced at Rs 79,000 (ex-showroom, Delhi). Many of the products
which the company has started with have been phased off. Now the existing products are
Karizma, Ambition, CBZ, Splendor, Splendor+, Passion, Passion Plus, CD 100 SS, CD 100
and CD Dawn.
The TCS study examines customer evaluations at three distinct ownership periods: 1 to 6
months, 7 to 18 months, and 25 to 36 months. This helps in understanding the differences in
satisfaction during initial ownership, in-warranty and post-warranty ownership periods.
Satisfaction ratings decline as the length of vehicle ownership increases. However, Hero
Honda Splendor is among the few models to maintain consistency across the three ownership
periods.
PRICING
Pricing is a important component of marketing mix of the firm. Determining the prices of
different products of a firm is very difficult task of the marketing manager. Price denotes
money value of a product. If represent the amount of money for which a product can be
exchange. In other words, prices represents the money which the buyer pays to the seller for a
product price represent the exchange value of goods and services in terms of money. Price is
all around.
Price factor has very well been touched by the manufacturers. The pricing strategy of the
company is very set. They price their product according to the cost of production and also by
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
19/42
keeping an eye on the price of the competitors of that segment and demand of the product in
the market.
A pricing strategy that ensured an average manufacturer margin that game dealer an adequate
return and created a reputation with consumers like a company selling a good quality
product at a reasonable price. Industry focus themselves the low cost producer with good
quality and aimed to maintain the price advantage in every market of two wheelers.
Hero Honda group ensures an easily affordable pricing through excellent transportation to
common man. It fixes customer centric pricing that provide customer total satisfaction.
Hero Hondas pricing objectives are: List price, Discount, Financing schemes, Credit terms,
and Maximize profits
Hero Honda group ensures an easily affordable pricing through excellent transportation to
common man. It fixes customer centric pricing that provides the customer with total
satisfaction.
PLACE
CHANNELS OF DISTRIBUTION:
As a company, dealers play a major role in serving customers, while growing and sustaining
markets. Hero Honda has a network of more than 3500 strong and dedicated Authorized
dealers. A network that has helped Hero Hondas name and its promise of reliable quality to
every part of the country. The power of this highly efficient and motivated network goes a
long way to create goodwill for Hero Honda brand among countless consumers besidescreating availability and after sales services.
The channel of distribution is a direct dealer network. A direct dealer is a dealer who is
authorized to purchase the product directly from the company and sell.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
20/42
PHYSICAL DISTRIBUTION:
Hero Honda has more than 3500 showrooms in India. Some of the Authorized dealers of
Hero Honda Karizma, in and around Bombay, are:
Max Motors (Bombay)
F. P. Motors (Bombay)
Axis Motors (Thane)
Ranjeet Motors (Thane)
Ahir Motors (Kalyan)
Spectra Motors (New Bombay)
H. M. Motors (Panvel)
PROMOTION
Promotional tools
1. ADVERTISING: It is defined as a paid non-personal communication with a target
(usually mass) market. It is cost effective and can reach a large number of people. It can
also be used for long term or short term objectives.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
21/42
There are various forms or mediums through which can advertise.
A. Broadcast Media:
Television
Radio
Cinema
B. Print media:
Newspapers
Magazines
Leaflets
C. Outdoor media:
Posters and billboards.
2. PUBLIC RELATIONS AN PUBLICITY:
Public relations are an umbrella term and refer to the totality of the organizationsbehavior with respect to the society in which it operates. The maybe regarded as good or bad
and is reflected in the companys reputation and image.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
22/42
3. SPONSORSHIP:
Sponsorship can be seen as a part of public relations and it is certainly the case that some
sponsorship goes on to generate positive publicity for the organization.
The company has not left any stone untamed in sponsoring the major events both globally
and domestically. The biggest of all is the sponsorship of the WORLD CUP for which
Hero Honda has the credit of being the only two-wheeler company in the world to do so.
Recently they are sponsoring the Hockey World cup. Besides this, the company has also
sponsored events like Master Golf, television academy awards, etc,
Thus the company has gained a lot of reputation by doing so.
4. DISCOUNTS/OFFERS:
The company has started giving discounts and other offers to the customers on the
purchase of a new bike, for instance, with the World Cup offer, in which the consumer was
to get a 1 gm gold coin with every purchase.
But after all these schemes and benefits may be because of cut-throat competition in the
segment with heavyweight competition such as Bajaj, kinetic, Yamaha, and TVS the
company (HERO HONDA) officially says:
Our aim is to proactively and consistently deliver value to the customer. We are giving
back to the customer after becoming successful. Most companies give discounts only when
their products are not doing well in the market. There is lost of competition in the segment,
especially from Bajaj. But the reason for Hero Hondas success it that we are consumer-
focused while other companies such as Bajaj tends to be more competitor-focused.
5. Test ride and Road show
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
23/42
PROMOTION POLICY:
Company gives advertisement in different media vehicles time to time. Like in TV.
Magazines, newspaper, etc.
Hero Honda also organizes free service camps every year.
Hero Honda also takes art in trade fair.
Hero Honda with the help of ICICI Bank provides loan to the customers & also
provide easy monthly installment scheme to customers.
Hero Honda gives huge commission to their dealers.
Advertisement, local events sponsorship and promotions and inviting a prominent personality
for the inaugural or first like delivery function would contribute effectively in generating a
wider local interest and attention.
Hero Hondas latest DKD 2 commercial its two brand starring its Ambassador and Indias
heart throbs, Hritik Roshan and Sourav Ganguly, truly reflects the multi fact roles that
todays new generation plays. The commercial reflecting the charisma and vibrancy of these
two stars, takes Desh Ki Dhadkan to dazzling new heights. It is young, colorful and vibrantand represents the icons of contemporary times. And it will go a long way in strengthening
the leadership status of the product by the mile.
The new commercial is powerful film repeat with an impressive storyline. The effort to pack
the story, drama and impact in just 60 seconds was phenomenal challenge itself. The idea was
born itself. The idea was born out of the very essence of Hero and Stars. Keeping in mind
would cause on the drama and impact it would cause on the audience. It is a commercial
packed with action where todays heart throbs, Hritik and saurav, are seen tackling new roles.
The story being in a field adjoining a hill with two cool men, Hritik and Sourav on Hero
Honda bikes and Passion respectively.
Both Sameer and Aditya win lifetime opportunity act with Hritik and Sourav, the two star
heartthrobs of millions in India and all four will be seen in action in the new commercial
DKD-2.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
24/42
These are some of the Slogan for every product (Bike) and these are following:-
CD-100 : Fill it, shut it, Forget it.
CD100SS : Tough and Rugged.
Splendor : Designed to Excel.
Street Smart : License to enjoy.
Passion : When style matters, Bike born in studio not in factory.
CBZ : Motorcycling Unplugged.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
25/42
MARKET SEGMENTATION OF HERO HONDA
Demographic Segmentation
Income: HERO HONDA products are offered to the public taking into
consideration all the income groups in the society.
Age: The main segmented group for the motorcycle are 18 years and
above.
Occupation: All kinds of people are taken into account. Students,
professionals, Govt. Servants, etc.
Geographic Segmentation: The potential customers are basically
from every regions of India.
Psychographic segmentation: People purchasing bikes are very
economical, quality, brand conscious and loyality.
Behavioral segmentation: This segmentation is done considering
user status, benefit wise.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
26/42
TARGETING AND POSITIONING OF HERO HONDA
TARGETING
The proposed targeting people in the age group of 18 years and above with a average
monthly income of approximately Rs. 10,000 and above, who are brand loyal and
who are either students or retired individuals or may be employed as professionals,
government servants or having their own business, but mostly male i.e on the
different stratas of the population.
POSITIONING
The image that Hero Honda creates in the mind of the customers is the faith. The
add shown by it says Desh kiDhadkan. That means its a member of the Indian
family. It represents the Indian culture and society.
The objectives can be achieved through the implementation of suitable marketing strategy by
the organisation. It is the marketing logic that is formulated keeping in mind the needs of the
consumers and also strategies of the competitors.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
27/42
Porters five force model for Hero Honda:-
Bargaining Power of suppliers:
Suppliers of auto components are fragmented and are extremely critical for this industry since
most of the component work is outsourced. Proper supply chain management is a costly yet
critical need.
Bargaining Power of Buyer:
Buyers in automobile market have more choice to choose from and the increasing
competition is driving the bargaining power of customers uphill. With more models to choose
from in almost all categories, the market forces have empowered the buyers to a large extent.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
28/42
Competitive rivalry:
The industry rivalry is extremely high with any product being matched in a few months by
competitor. This instinct of the industry is primarily driven by the technical capabilities
acquired over years of gestation under the technical collaboration with international players.
Threat of substitute Products:
There is no perfect substitute to this industry. Also, if there is any substitute to a two-
wheeler, Bajaj has presence in it. Cars, which again are a mode of transport, do never directly
compete or come in consideration while selecting a two-wheeler, cycles do never even
compete with the low entry level moped for even this choice comes at a comparatively higher
economic potential.
Threat of new entrants
Here the threat of new depends on the economies of scale of the cost of production
, and customer switching costs, access to industry distribution channels.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
29/42
S.W.O.T. ANALYSIS OF HERO HONDA (KARIZMA):-
STRENGTH:
It has a good speed and sporty look
Karizma is the First bike in India launched under Sports Bike Segment.
Loyal Customer Base: In the past four years, Karizma has been successful in building up a
good and loyal base among its customers.
After Sales Service: Till today, customers are satisfied with the after sales service provided
by Hero Honda for this particular product.
Refinement, comfort, great handling and that much-sought-after big bike feel are all
available on the Karizma.
Brand Recall: the name Karizma itself is a metaphor to its success. The brand Karizma has
given a good platform to this product in the Sports Bike Segment.
WEAKNESS:
High Maintenance: The maintenance of Karizma is high as compared to its biggest
competitor Bajaj Pulsar 200cc and 220cc.
Fuel Efficiency: The pulsar 200cc offers an impressive mileage of 38.3kpl in city and
42.4kpl in highway against the Karizma offers only 30kpl in city and a decent figure of 45kpl
in highway. Less Promotion: the promotions and ads of Karizma are very less as compared to its
competitors.
OPPORTUNITIES:
If Hero Honda comes up with the idea ofchanging some features of Karizma, like self
cancelling indicators, soft touch handle bar and digital speedometer, it will help them to
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
30/42
boost up the sales of Karizma.
If they are able to improvise the fuel efficiency of Karizma, it will be a golden opportunity
to take over the market.
THREATS:
The major threat faced by Hero Honda Karizma is from Bajaj Pulsar, who has always been
the market leader in the 150 plus segment with 60% market share.
Karizmas strong competitors Bajaj and TVS, in 150 cc plus segment, already posses certain
featureslike self-controlling indicators, soft touch handle bar which Karizma lacks.
The competitor Pulsar 200cc has already come up with oil cooled engine which delivers
maximum power. This is again a major threat to Karizma.
S.W.O.T. ANALYSIS OF BAJAJ (PULSAR 220cc)
STRENGTHS:
Pulsar 220cc features Indias First Oil Cooled Engine which delivers maximum power
making it most powerful engine offered by Bajaj.
New Pulsar also provides Digital Speedometer, Self Canceling Indicators which is for the
First time in this segment in India.
Fuel efficiency: Pulsar 220cc delivers an impressive mileage of 38.2 kmpl in city as
compared to Karizma which delivers 30 kmpl in city.
Customer Base: In past decade Bajaj has established a strong base amongst its customers.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
31/42
WEAKNESS:
Style and Design: PULSAR 200cc and 220cc derives their styling from there previous
version Pulsar 150 Dts-i and 180 Dts-i.
Pricing; Bajaj 220cc (Rs 82449 basic price) is costlier than karizma(Rs 78000 basic price)
OPPORTUNITIES:
If they derive new styling, shape, design for pulsar 200cc and 220cc then they can attract
more customers.
Taking into consideration the reviews of the customers regarding the fairing of 220cc
and making the needful changes will be an opportunity to capture an even larger share of
the 200cc+ segment
THREATS:
The biggest threat is faced from the goodwill of Karizmain this segment who is the Four-
Stroke Two Wheeler Ruler of the Indian bike market.
Certain technical faults in the bike design which are potentially dangerous to the riders
safety can be disastrous to the image of the bike.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
32/42
COMPARISION OF ADVERTISING STRATEY OF HERO HONDA AND BAJAJ
ADVERTISING STRATEGY OF HERO HONDA:-
Currently the number one company in terms of sales and has been dominant in the two-
wheeler segment since the past decade. Since the inception of hero Honda, the company has
been using television as a major role for its publicity. Though hero Honda was dominant in
sales it lacked the skills of creating a spectacular ad till now. Though it had a vast range of
mobiles, its advertising strategy was not up to the mark. For its publicity hero Honda has
been using many famous celebrities like Saurav Ganguly, the captain of Indian cricket team,
Hritik Roshan and other famous personalities as their brand ambassadors. Thus, hero Honda
has been spending huge amounts on its publicity.
The biggest of all is the sponsorship of the WORLD CUP for which Hero Honda has the
credit of being the only two-wheeler company in the world to do so.
Presently they have tried to gain publicity by sponsoring the hockey world cup event which is
the national game of India. There by creating a sense oneness and Nationalism through
providing publicity and encouragement to the game by various ads.
ADVERTISING STRATEGY OF BAJAJ:-
Bajaj is always known for its outstanding ads over the period of time. Since its
inception, Bajaj has come out with variety of ads and were always successful in their
advertisements. Scooters were well known by the brand name of Bajaj. Be it any scooter, one
used to recognize it by the brand name Bajaj. This was the identity a decade ago which the
Bajaj has still maintained. Bajaj is always known for its ads without well-known brand
ambassadors which is again a plus point to its cart as it saves a huge cost in terms of brand
ambassadors unlike Hero Honda and TVS. Prior, Bajaj used to convey the feeling of
Indianness in its ads. With a punch line Hamara Bajaj Bajaj drove into everybodys hearts
and the title song of Naye Bharat Ki Naye Tasveer added a g reat value to its mobikes and
scooters.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
33/42
A couple of years back, Bajaj had introduced an advertisement which promoted all the
different ranges it had, wherein they had shown each product they had with a feeling of
Indianness. Example: Eliminator passes-by a rangoli and drives slowly sideways without
disturbing it. People on boxer pass-by a temple and bend their head to give a little offering.
Such ads had revealing Indian culture had a great effect on Indians and Bajaj was successful
in most of its ads.
But recently, Bajaj had changed its brand logo along with its punch line i.e. Hamara
Bajaj got converted to Inspiring Confidence. The reason for this change as told by the
company officials was to keep pace with the new technologies in the fast moving world. Even
though it had changed its punch line, it didnt have much effect on its brand image.
A year back, Bajaj introduced DTSi technology upgrading its always successful
PULSAR 150cc and 180cc. Though Bajaj had changed its identity it still dominates for its
creativity in ads.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
34/42
Future Challenges and Plans:-
Sustaining the growth rate.
Need for innovation low cost/ hybrid vehicles.
Upgrading Indian two-wheeler products.
Taking the products to the global market.
Capturing Indian as well as global market.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
35/42
SCOPE
Scope was limited to the geographical boundary of the Ludhiana city.
Limitation of the Survey
Due to resources and time constraints the study was limited to the
Ludhiana city.
Sample was chosen according to the convenience and such sample
might not be representative of the universe.
Being an opinion survey the personal biases of the respondents might
have entered in their responses. As this study and its result are based on primary data, the probability of
personal bias cannot be overruled.
Since the sample size was 50, so the findings and conclusions of the
study are only suggestive not conclusive, in spite of the best and honest
efforts.
It cannot be accepted as a piece of excellence and is limited to the
knowledge and experience of a student.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
36/42
REVIEW OF LITERATURE
Though there are different market determinants for the product, the concept of
consumer behavior (CB) plays a vital role in selecting the particular companys
product. The following are few literature about CB towards automobile
product, particularly about two wheeler (TW) products at national and
international level.
Brown, T.M (1952) explored the presence of lagged influences.
Experimentation with various alternative hypotheses led to the development of a
habit hysterics habit persistence theory of the causal basic of the lag.
Havey, M. Wanger (1956) purposed theory analysis of CB for two related
aspects, the rest being that concerned with the consumers subjective point or
view as his action in the market and the second being concerned with the
economists point of view as an objective of the consumer market behavior.
Richard., E. Quandt (1956) revolved essentially around the problem of the
measurability of utility to initial approach to utility theory was the cardinals
approach of Jevans, Walras, Marshall etc., In fact, traditional theory is a
limiting case in the present model in a meaningful sense.
Eugene, J. Kelley (1958) found that to understand sopping behavior is to
increase importance the consumers are attaching to convenience considerations
to trend towards higher consumer valuation of ten convenience forms is
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
37/42
identified. Raymond, J. Lawrence (1966) examined the CB treating it is a
dichotomy, bought brand A and bought some other brand that A argued that
paired product comparisons are misleading and should be abandoned
(Blankenship, 1966) shows that it is possible and in fact easy to collect direct
observation of purchasing behavior instead. Joel, B. Cohen (1967) concluded
differential preference for exerting and reviewing interpersonal influence may
lead complaint, aggressive, and detached people to refer different roles in the
diffusion of information and the adoption of new product.
Gayler, H.J (1980) revealed that consumers were disaggregated by social class
(SC) and it was determined whether the higher the SC group, the greater was
the distance travelled to shop for five products. In the case of groceries and
womens dress the hypothesis was supported, reflecting variations in store and
shopping centre preference which require different distance to be travelled.
Louis, L. Wilde (1980) found that there are significant advantages to greater
collaboration between economists and consumer researchers (CRs). Alice, M.
Tybout, and John, R. Hauser (1981) examined the role that conceptual model of
CB can play in a marketing audit and concluded by theoretical support for the
model and has evaluated its application in a marketing decision environment.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
38/42
RESEARCH METHODOLOGY
SOURCE OF DATA
The study is the blend of primary and secondary data. Primary data have been
collected from the TW owners; the CB towards preference of TW, being a
broad area in view of time, money, energy and other factors, the study is
confirmed to the consumers of TW in Chennai, Tamil Nadu.
TOOLS USED FOR DATA COLLECTION AND FIELD SURVEY
Tools used for data collection
Observation method, and
Interview Schedule method.
SAMPLING TECHNIQUE
Probability sampling technique has been used for collecting data. A pre test
was conducted to check and ascertain the schedule prepared was
comprehensive, clear, effective and accurate. Due importance was given while
selecting the sample on various consumer characteristics viz, age, education,
occupation and sources of income. To get a precise, reliable data various tools
have been used for analysis of data.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
39/42
RESEARCH METHODOLOGY
RESEARCH
It is regarded as systematic process is any form of systematic and arranged
investigation to organize facts or gather data, and is often related to a problem
that has to be solved. Research is the study of materials, sources and data in
order to get conclusions. This project describes the methodology adopted for
conducting the comparative study on comparative Cadbury v/s Nestle
chocolates.
RESEARCH METHODOLOGY
It enumerates the description of the sampling plan, research instruments used
for the collection of data, pre-testing of questionnaires, the use of statistical
tools and the techniques for the analysis of the collected data.
RESEARCH PLAN
To meet the objectives of the study undertaken, descriptive research type was
adopted.
RESEARCH DESIGN
It is an arrangement of plan, which guides the collection of data and analysis of
data. The purpose of research design is to ensure that the data collected is
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
40/42
accurate and relevant. Any research work requires clarity of objectives to be
achieved effectively. Research design is so chosen that the analysis is accurate.
SELECTION OF POPULATION
Due to constraints, the study has been conducted in the city of Ludhiana. The
population for the research was the general people.
SELECTION OF SAMPLE
Sampling unit: consisted of students, women and men of all ages.
Sampling size: The sample for this research was 50 respondents.
Sampling procedure: judgement and convenient sampling techniques
were adopted.
SAMPLING TECHNIQUES
For the purpose of research, questionnaires were used to interview the
respondents. The questionnaires were developed so as to obtain responses
relevant to the objectives of the research. While designing the questionnaires
every attempt was made to make it precise so that the purpose of filling up the
responses does not consume time.
To find the general attitude, perception, beliefs and intentions of people towards
SUVs market in India, a questionnaire was developed.
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
41/42
The questionnaire, which was administrated to the respondents for the
purpose of collecting primary data, was a structured one.
The questionnaire included dichotomous, rating, ranking type of
questions which were aimed at knowing the instant and unbiased
response of the respondents.
DATA COLLECTION METHOD
Primary data: in this study, I have used the unbiased structured
questionnaires and personal interviews as the method for receiving
primary data.
Secondary data: in this study, I have acquired the information from
various newspaper, magazines and various websites.
DATA ANALYSIS AND INTERPRETATION TECHNIQUES
For data analysis and interpretation, the data was processed with various tools
of percentages. For interpretation, various tools have been used and they are as
follows:
Tables
Graphs
Pie charts
Rank score charts
-
7/27/2019 27797997 Two Wheeler Automobile Marketing Strategy
42/42
ANALYSIS OF RATING TYPE QUESTION
In case of five scale where respondents are asked to indicate their degree of
agreement and disagreement scores were assigned from -2 to +2 where the
respondents disagreed with the statement a score -2 was assigned a score of 0
was given to an indifferent response. Frequencies were multiplied with their
respective scores and mean score was found out.
ANALYSIS OF RANKING TYPE QUESTION
Ranking type question was evaluated by giving weight ages to the different
ranks as follows:
Rank Weightage
1 5
2 4
3 3
4 2
5 1
These weights multiply with their respective frequencies and weighted mean
scores were calculated.