1. 1. Presented By 1 RURAL MARKETING STRATEGY OF BAJAJ
2. 2. DEFINING RURAL INDIA RURAL RETAIL SCENARIO IN INDIA BAJAJ RURAL STRATEGIES CASE STUDY OF BOXER 150 VIDEO DEMO July 6, 2013 2 CONTENTS
3. 3. Census of India defines Rural Settlements as Population lower than 5,000 persons Population density lower than 400 persons/sq. km At least 75% of male population engaged in Agri. activities. July 6, 2013 3
4. 4. RURAL SCENARIO RETAIL TOWARDS RURAL AREAS GREAT OPPORTUNITIES FOR MARKETER THE INDIAN RURAL MARKET July 6, 2013 4
5. 5. RETAIL TOWARDS RURAL AREAS Rural India consists of 720 Million consumers across 6,38,000 villages 17% of these villages account for 50% of the rural population and 60% of the rural wealth Extensive reach is required as to cover 50% market 1,00,000 villages must be catered Immense opportunity amounting to US$ 125 billion 5
6. 6. Triggering Rural economy Creates Purchasing Power by focusing on increasing Income Levels July 6, 2013 6
7. 7. THE INDIAN RURAL MARKET The Rs.140,000 Crore rural retail market is expected to cross Rs.180,000 Crore mark by 2012, And up to Rs.240,000 Cr by 2015 (CII). The rural revolution is driven by Rising purchasing power Changing consumption patterns Increased access to information and communication technology Improving infrastructure Increased government initiatives to boost the rural economy July 6, 2013
8. 8. RURAL OCCUPATION STATISTICS July 6, 2013 8 OCCUPATIONS URBAN RURAL Cultivator 5 40 Petty Shopkeeper 15 5 Wage earner 20 35 Salary earner 40 20 Others 18 8
9. 9. THE RURAL CONSUMER Is a value seeker Seeks comforts and amenities Does not wish to be seen as the deprived cousin. Does not experiment easily but this does not mean that he would not change. Values local relationships because of unfavorable past experiences July 6, 2013 9
10. 10. Rural Business Challenges o Increasing costs of land o Pace of expansion o High operating costs o Low purchasing power of consumers Lack of literacy and awareness Low per capita income Wide geographic spread. Gaps in road and Telecommunications connectivity. Lack of reliable electricity and water supply Limited Distribution network for example cold storage. Competition from local players July 6, 2013 10
11. 11. Bajaj Group Bajaj Group (pronounced is an Indian conglomerate founded by Jamnalal Bajaj in 1926, Mumbai. Bajaj Group is one of the oldest & largest conglomerates based in Mumbai, Maharashtra. The group comprises 34 companies & its flagship company Bajaj Auto is ranked as the world's fourth largest two- and three-wheeler manufacturer. July 6, 2013 11
12. 12. BAJAJ AUTO Bajaj Auto has the major competitor as Hero Honda in rural and semi-urban markets which accounts for more than half of two-wheelers sold in the country. Bajaj Auto is based in Pune, Mumbai, with plants in Chakan (Pune), Waluj (near Aurangabad) and Pantnagar in Uttarakhand. The oldest plant at Akurdi (Pune) now houses the R&D centre Ahead. July 6, 2013 12
13. 13. BAJAJ AUTO Bajaj Auto makes and exports automobiles, scooters, motorcycles and auto rickshaws. Bajaj Auto is the world's third-largest manufacturer of motorcycles and the second-largest in India. The Forbes Global 2000 list for the year 2005 ranked Bajaj Auto at 1,946. It features at 1639 in Forbes 2011 list. July 6, 2013 13
14. 14. BAJAJ AUTO MARKET Bajaj Auto has about 27% of the two wheelers market share The motorcycle segment constitutes about 81.5% of the two wheeler market in India. It also contributes to three- fourths of the total exports in the two wheeler industry. Bajaj is the second largest player in this segment after Hero Honda. July 6, 2013 14
15. 15. BAJAJ RURAL APPROACH The country's second largest two-wheeler maker has appointed 135 dealers in small towns and mini metros, where it had only 25 dealers, and will offer special finance scheme for rural customers even if they have no bank account. Bajaj Auto is going at full throttle to challenge market leader Hero Honda in rural and semi-urban markets that account for more than half of two-wheelers sold in the country. July 6, 2013 15
16. 16. BAJAJ RESEARCH STUDY Company has been conducting a lot of market research in Rural Sectors and found that the rural customers are seeking for bikes with wider tyres that gives more road grip, which essentially requires higher engine power July 6, 2013 16
17. 17. BAJAJ BOXER INTRODUCED New Product Introduction For Rural Segment The company added another model, Boxer 150 cc which is dubbed as 'Tank on Two Wheels' by August this year targeting the rural market. Bajaj discontinued the boxer 100cc and 125cc variety since the rural market has been experiencing the change as reflected in the pattern of sales July 6, 2013 17
18. 18. EASY LOAN FACILITY FOR RURAL AREAS Bajaj introduced easy loan facility for the natives of Hingoli village in Maharashtra Scheme Details Offered a special financing scheme backed by Bajaj Auto Finance with a direct cash collection facility. That is, customers need not provide post-dated cheques to avail of finance ; they can pay the installments in cash. The loans will be given on the basis of trust and initial verification and there will be no collateral . The company has already tried this out in select areas and, found default rate is much less than in the post-dated cheque system. July 6, 2013 18
19. 19. Bajaj Auto introduced seasonal collection strategy for rural areas. This would mean that instead of monthly installments , rural customers can time their loan repayment to crop cycle, which is 2-3 months for rice and wheat. RESULTS Bajaj Auto was able to improve its market share to more than 30% with the rural push, compared to the 27% share July 6, 2013 19 EASY LOAN FACILITY FOR RURAL AREAS
20. 20. Video Ad This Ad focuses on the Rural Segment It aspires a common farmer to purchase the bike The Bajaj sales advisor introduces him, with the easy finance option and the Farmer agrees to go for the purchase The Joyful moments is shared in the video July 6, 2013 20
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