Babru S Final Report Updated

PROJECT REPORT ON

“BRAND IMAGE BUILDING APPROACH IN TWO WHEELERS”

Submitted in partial fulfillment of the requirements for the award of degree of

Master of Business Administration Of

MAHARSHI DAYANAND UNIVERSITY, ROHATK (Sesson: 2007-2009) Submitted To:-

Submitted By:-

Dr. R N SINGH

BABRU BHAN YADAV

Faculty (MBA Dept.)

MBA (IV-Sem.)

INSTITUTE OF MANAGEMENT & TECHNOLOGY (Approved by AICTE, Govt. of India & Affiliated by M.D. University, Rohtak.) (AN NBA ACCREDITED INSTITUTE) Tigaon Road, Near Sai Dham Faridabad-121002

Table of contents •

Chapter I Introduction  Significance of the problem  Review of the literature  Conceptualization  Operationalisation of the concept  Focus of the study  Objectives  Limitations  Chapterisation  Notes (references)

•

Chapter II Research Methodology  Universe and survey population  Profile of the organization  Research design  Sample size and techniques  Analysis pattern  Data collection (primary and secondary)  Identification of the independent and dependent variables  Content analysis  Applied statistical tools

•

Chapter III  Objective wise analysis (Micro Analysis)

•

Chapter IV  Macro analysis(Interface and Interpretation)

•

Chapter V  Summary of major observations & recommendations

Annexure Questionnaire Raw analysis Bibliography

DECLARATION

I, Babru Bhan Yadav of MBA IVth Sem., of IMT Faridabad, hereby declare that the project entitled “BRAND IMAGE BUILDING APPROACH IN TWO WHEELERS (AN ANALYSIS OF HERO HONDA VS TVS MOTORS)” is an original work and the same has not been submitted to any other institution for the award of any other Degree. The interim report was presented to the supervisor. The feasible suggestions have been duly incorporated in consultation with the supervisor.

Countersigned

Signature of the supervisor

Forwarded by:

Director/Principal of the institute

Signature of the candidate

PREFACE

My stepping stones…...

I had an impression in my mind that the project which I am going to undertake would only be a mere prerequisite to enter into a corporate world. But when it came to end, only then, I understood that, what it is like to be professional man. How important this project is for all students who are doing their post graduate degree in Business Administration. I learned a lot from this experience, many aspects were totally new to me and it took great deal of efforts to understand them but now when I am finished with this project, I can say that the time which I spent on this project gave me knowledge and professional attitude for whole life. The following report discusses the details of these experiences and about the project. I thank everyone who has contributed to make this experience complete and fomented.

(Babru Bhan Yadav)

ACKNOWLEDGEMENT

Concentration, dedication, hard work and application are essential but not the only factor to achieve the desired goal. Those must be supplemented by the guidance assistance and cooperation of experts to make it success. I am extremely grateful to my institute for providing me the opportunity to undertake this research project in the prestigious field. With profound pleasure, I extend my extreme sincere sense of gratitude and indebtedness to my faculty for extensive and valuable guidance that was always available to me ungrudgingly and instantly, which help me complete my project without difficulty. I express my deep and sincere gratitude to Dr. R.N.Singh (Faculty - MBA Dept.) for providing me first hand knowledge about other related subjects. Last but not the least I am indebted to Dr. Ravi Handa, Director, of our institute without whose sincere gratitude this project would not have been possible.

CHAPTER – 1 INTRODUCTION

INTRODUCTION SIGNIFICANCE OF THE PROBLEM

 The project involves, the study of the segmentation, targeting & positioning of Hero Honda two-wheeler in the market. And what people think about it in Comparison with TVS Motors.  It includes carrying out a survey among customers & the industry people as well as the retailers of these two Companies. It also involves the devising of repositioning of the existing brand by some modifications; advertisement should be so made that the targeted segment comes to know what the bike is. How is it better from TVS. So, that in near future this bike becomes a grand success.  Information regarding the market share, cost factors, the marketing and promotional strategies etc was collected from primary and secondary data sources.

REVIEW OF LITERATURE Some people distinguish the psychological aspect of a brand from the experiential aspect. The experiential aspect consists of the sum of all points of contact with the brand and is known as the brand experience. The psychological aspect, sometimes referred to as the brand image, is a symbolic construct created within the minds of people and consists of all the information and expectations associated with a product or service. People engaged in branding seek to develop or align the expectations behind the brand experience (see also brand promise), creating the impression that a brand associated with a product or service has certain qualities or characteristics that make it special or unique. A brand is therefore one of the most valuable elements in an advertising theme, as it demonstrates what the brand owner is able to offer in the marketplace. The art of creating and maintaining a brand is called brand management. Careful brand management, supported by a cleverly crafted advertising campaign, can be highly successful in convincing consumers to pay remarkably high prices for products which are inherently extremely cheap to make. This concept, known as creating value, essentially consists of manipulating the projected image of the product so that that the consumer sees the product as being worth the amount that the advertiser wants him/her to see, rather than a more logical valuation that comprises an aggregate of the cost of raw materials, plus the cost of manufacture, plus the cost of distribution. Modern value-creation branding-and-advertising campaigns are highly successful at inducing consumers to pay,

AUTO INDUSTRY- A REVIEW INTRODUCTION The Rs. 5500 crore Indian Two wheeler segments is the second largest market fin the world after China. India’s two wheeler production is the third largest in the world after Japan and China. India has a well- developed two wheeler market with around 15 million households owning two-wheeler. The Indian two wheeler industry made a modest beginning in the early 1950 when Automobile Product of India (API ) started manufacturing scooter in India. Until 1958. API and Enfield /( motorcycle) were the only two production. In 1948, Bajaj auto began trading in imported Vespa scooter and the three – wheeler- finally, in 1960’s. it set up shop to manufacturer them in technical collaboration with piggaio of Italy. The agreement expired in 1971. In the initial stages, the scooters segment was regulated regime, foreign company was not allowed to operate in India, and waiting time for getting Bajaj scooters was as high as 12 years. Java and escort. While the Enfield bullet was a four strokes bike, the Java and Rajdoot were two-stroke bikes. The motorcycles industry was originally dominated by Enfield with 350 cc bikes. The motorcycles

industry was cc segment. The two wheelers segment was opened up to foreign competition in the mid 1980’s which saw the entry of the Japanese manufactures into the country.

MARKETSHARE OF 125-250 CC MOTORCYCLES (2007-08)

HONDA (UNICON) 11%

HERO HONDA (CBZ) 4%

SUZUKI (ZEUS) 5%

TVS (APACHE) 14% YAMAHA (RX 135) 4%

BAJAJ AUTO (PULSAR) 62%

CLASSIFICATION OF THE INDUSTRY The two-wheeler segment can be categorized into the scooter, mopeds, and motorcycles. Motorcycles: this segment has shown the best performance in the recent years. The market leaders in this section are Bajaj Auto. TVs Suzuki, Hero Honda and Escort. The splendor is the most popular segment among motorcycles.

Two Wheeler Industry The Indian two wheeler contributes the largest volumes amongst all the segments in automobile industry. Though the segment can be broadly categorized into 3 subsegments viz.; scooters, motorcycles and mopeds; some categories introduced in the market are a combination of two or more segments e.g. scooterettes and step-thru's . 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 2000-01. 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 slow down 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 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 motorcycle segment); Hero Honda Splendor (best executive motorcycle segment); Bajaj Pulsar (best premium motorcycle segment); and Royal Enfield Bullet Electra (best cruiser motorcycle segment). "The relatively low score for the premium segment indicates that most manufacturers have fallen short of meeting the high expectations of these buyers," states Mr. Lochan. "Bajaj Pulsar is one exception with segment-leading ratings across all aspects of ownership experience, particularly on areas related to vehicle styling."

Production, sales growth of the industry The two-wheeler companies have been operating at high capacities due to high growth rates between 1993 and 1996. The growth is expected to lead to increase in the capacities from present 32 lakhs units to 50 lakhs per annum in the year 2002-03 , whereas the actual production estimates by that period at an estimated growth rate of 18% is only 50 lakhs.

CONCEPTUALISATION This report deals with Motor Bike Industry in India, who are the major players in this industry and what is their image in eyes of customers. How consumers recognize and rate Hero Honda in comparison to TVS Motors in the market is the main motto of study. The project named “BRAND IMAGE BUILDING APPROACH IN TWO WHEELERS. (An Analysis of TVS Motors & Hero Honda)” is undertaken to analyze how customer views Hero Honda as a Brand in comparison to TVS Motors. HERO HONDA Motors Ltd. (HHML) came into existence by collaboration of HERO Cycles Pvt. Ltd. & HONDA Motor Company. Advanced technology coupled with environmental friendly approach of treating effluents is the one of the outstanding feature of this organization. HERO Group has been a pioneer & now an unmistakable leader in an array of consumer & industrial appliances including motorcycles, light motorcycles, mopeds, automotive components and industrial supplies. This report tries to find out Brand Image of Hero Honda & TVS Motors in customer’s eyes in comparison to other competing brands available in the market. This report puts a light on consumer perception relating to brands available in Motor Bike Industry & whether Hero Honda & TVS, as a brand are able to retain their position in the Market beside cut throat competition or not. This project is not concentrated to a particular area or factor. This project basically includes all the factors which emphasize purchasing decision of a customer and his choice. The project is based on a Market Survey being conducted of the general customers & thereby analyzing and recording their views about Hero Honda and TVS Motor.

OPERATIONALIZATION SEGMENTATION, TARGETING & POSITIONING From the current segmentation, targeting & positioning and consumer surveys we found that our client has targeted the following segments: ♦ Congested areas of urban cities. ♦ Males/Females between the age group of 18-36 ♦ Middle class people , mostly officials & executives The client analysis from our questionnaire it was found that our client has targeted the right segment HHML & TVS is overlooking one feature in bike which is its low maintenance cost and reliability (i.e. less chances of breakdown) which is absent in its competitors. Therefore, in order to meet the sales target, two options are available with the client, one is to redesign the bike and second is to reposition the bike as “Bike with one time investment”. Since redesigning of bike may involve a big task and huge investment therefore we recommended repositioning the bike.

INDUSTRY DEVELOPMENT India is the second largest manufacturer and producer of two wheelers in the world. It stands next only to Japan and China in terms of the number of twowheelers produced and domestic sales respectively. This distinction was achieved due to variety of reasons like restrictive policy followed by the Government of India towards the passenger car industry, rising demand for personal transport, inefficiency in the public transportation system etc. The Indian two-wheeler industry made a small beginning in the early 50s when Automobile Products of India (API) started manufacturing scooters in the country. Until 1958, API and Enfield were the sole producers. In the initial stages, the scooter segment was dominated by API, it was later overtaken by Hero Honda. Although various government and private

enterprises entered the fray for scooters, the only new player that has lasted till today is LML. Under the regulated regime, foreign companies were not allowed to operate in India. It was a complete seller market with the waiting period for getting a scooter from Hero Honda being as high as 12 years. 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 low power bikes, demand swelled, resulting in Hero Honda then the only producer of four stroke bikes (100cc category), gaining a top slot. 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. The entry of Kinetic Honda in mid-eighties with a variometric scooter helped in providing ease of use to the scooter owners. This helped in inducing youngsters and working women, towards buying scooters, who were earlier, inclined towards moped purchases. In the 90s, this trend was reversed with the introduction of scooters. In line with this, the scooter segment has consistently lost its part of the market share in the two-wheeler market. 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 0.4 mn 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 crunch in consumer financing. Factors like increased production in 1992, due to new entrants coupled with the recession in the industry resulted in companies either reporting looses or a fall in profits.

OBJECTIVES  To study the marketing mix of Hero Honda & TVS Motors.  To study various promotional strategies and know about the current strategies keeping in mind the cutthroat competition between Hero Honda & TVS Motors.  To focus on comparative marketing strategies of Hero Honda &

TVS Motors.  Different range of Products; their success and failure.

HYPOTHESIS

In statistics, a null hypothesis (H0) is a concept which arises in the context of statistical hypothesis testing. A common convention is to use the symbol H0 to denote the null hypothesis. The null hypothesis describes in a formal way some aspect of the statistical behavior of a set of data and this description is treated as valid unless the actual behavior of the data contradicts this assumption. Statistical hypothesis testing is used to make a decision about whether the data does contradict the null hypothesis: this is also called significance testing. A null hypothesis is never proven by such methods, as the absence of evidence against the null hypothesis does not establish the truth of the null hypothesis. Failing to reject H0 says that there is no strong reason to change any decisions or procedures predicated on its truth, but it also allows for the possibility of obtaining further data and then re-examining the same hypothesis. The alternative hypothesis (or maintained hypothesis or research hypothesis) and the null hypothesis are the two rival hypotheses whose likelihoods are compared by a statistical hypothesis test Usually the alternative hypothesis is the possibility that an observed effect is genuine and the null hypothesis is the rival possibility that it has resulted from chance. The classical (or frequentist) approach is to calculate the probability that the observed effect (or one more extreme) will occur if the null hypothesis is true. If this value (sometimes called the "p-value") is small then the result is called statistically significant and the null hypothesis is rejected in favor of the alternative hypothesis. If not, then the null hypothesis is not rejected. Incorrectly rejecting the null hypothesis is a Type I error; incorrectly failing to reject it is a Type II error.

LIMITATIONS



Due to lack of time I was not able to cover many customers.



As I reside in Faridabad which is near to Delhi (Metro city and capital), so customers of Delhi and Faridabad were taken into account.

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Answers given by the customers may be biased one.



Research work was confined to definite area in Delhi.

CHAPTERISATION This section of the research project contains a precise summary of the chapters which are being included in the study. The chapter first of the study contains the introduction of the research topic, with its significance for the organization and the concerned customers. A detailed concept of the topic has been mentioned in the chapter. Which gives a conception of the concerned topic i.e., its concept could be understood through it. The second chapter of the research study deals with the research portion, related to the universe and survey population, profile of the organization, its design, sample size & further various method of the data analysis. The medium of the data collected has also been mentioned in this section of the study. The third chapter of the study includes the objective wise analysis of the research study. This depicts a specific view of the outcomes of the study as per the objectives of the study. The proceeding chapters 4, 5, and 6 of the project contain interpretation of the data, which has been collected during the period of research. Chapter fifth includes the major observations of the study, followed by the questionnaire, tables& raw analysis, and bibliography in sixth chapter.

CHAPTER-II RESEARCH METHODOLOGY

RESEARCH METHODOLOGY

UNIVERSE AND SURVEY POPULATION:The universe for the project was the population of Faridabad and Delhi NCR The survey population was youngsters and bike owners. The project involves the study of four- strokes bike segment in two wheeler industry sector, which involved: 1.

Market survey/ Researches

2.

Meeting the retailers and the customers

3.

Desk Research

PROFILE OF THE ORGANISATION COMPANY PROFILE OF HERO HONDA Hero Honda Motors Limited (HHML) started as a Joint Venture between Hero Group, the world's largest bicycle manufacturers and the Honda Motors of Japan. Today HHML is the manufacturer of India's largest selling motorcycles. Coming into existence on January 19, 1984, the company gave India nothing less than a revolution on two-wheels made even more famous by the 'Fill it - Shut it - Forget it' campaign. With a market share of 42% in the motorcycles segment and 20.16% in the two wheeler industry as a whole, HHML is building on the trust of 1 million customers. The philosophy of HHML has been to produce vehicles based on consumer preferences. They ensured superior quality in style, and excellent performance in terms of fuel efficiency. This helped the company to become the market leader in the motorcycles segment. Fuel efficient bikes managed to overcome the price advantage that scooters had over motorcycles and this has initiated the shift of consumers from scooters to Motorcycles.

New Models The company has a large portfolio of brands, with the money-spinners being mainly Splendor (the world's largest selling bike) Passion. 150cc CBZ aspirational brand. "The launch of CBZ got us into a different league altogether. Although the sales are just about 3,000 a month, it made us an overall bike company," says Sobti. Hero Honda would launch a new model in the 100cc-150cc category by the middle of the current year, the Managing Director, Mr. Pawan Munjal, said. Meanwhile, the company is yet to decide on the location of its proposed third manufacturing unit. “The feasibility study is on'', he said, adding that the new plant was likely to come up in the next 18 months. New launches are likely to help Hero Honda gain a market share in the coming quarters. Hero Honda Motors Ltd, has launched a new 100-cc four-stroke bike, Dawn and CD100 and CD100 SS are likely to be phased out of the market once the new model sells ``10,000 plus'' units per month, ``six months from today''. CD100 model sells close to 15,000 units per month.

Sales Performance It is my privilege to share with you the fact that by the end of the calendar year 2001, Hero Honda became the largest single two-wheeler manufacturer in the country and also in the world. The leading edge got consolidated by the close of financial year 2001-02 with a record sale of 1.43 million units. This is equivalent to 35.2% growth on the previous year sale of 1.03 million units. In the same manner, the market share of the company increased to 48% and 33 % in motorcycles and two-wheelers, respectively. Hero Honda Motor Ltd., the country's largest two-wheeler maker, finished the year 2002-03 with total motorcycle sales of 1,677,535 units; a growth of 18% over last year's sale of 1,425,302 motorcycles. For the month of March 2003, the company posted sales of 115,722 motorcycles compared to 135,464 in March 2002. As reported earlier, the economic slowdown, as a consequent of drought in certain parts of the country, and low agricultural production, affected the demand for a whole lot of durable including motorcycles. Lack of clarity on VAT issues also impacted sales. The company achieved a significant landmark in exceeding its sales turnover target of Rs. 5000 crore during the year; up from Rs. 4539.49 crore in the previous year. Last year, two new models were launched, namely Passion and Joy to address superstyle and economy segments. Passion has found its position firm amongst Indian models, only next to Splendor, the largest selling bike in the world in terms of sales performance. Joy was re-launched as Dawn, in April 2002, with changes and value additions to cater to specific needs of the customers. Reportedly Dawn is doing well in its segments and has sold over 10,000 units in the initial months itself. Hero Honda has targeted a sale of over 1.8 million bikes for the year 2002-03. This effort is supplemented by two major launches this year, one in September and the other coinciding with World Cup Series in early 2003, which is being sponsored by Hero Honda Motors Ltd. These bikes will have some novel features and will be in the 100cc plus range. There is an ambitious programme of launching a new range of bikes with technical support from Honda in the coming years. With a slew of such measures the capacity available at present locations can at best support two-million production targets at the existing plants. The company, therefore, is looking at the possibility of setting up a third plant to meet the future demand and for which techno-economic study is in progress.

New Initiatives Customer and customer satisfaction is the purpose of our being an entity. To increasingly understand him and make him part of our ongoing business we have launched a unique

CRM Program called “Hero Honda Passport Program” The passport holders not only get concessions on parts and spares but also enjoy the benefit of company organized cultural and sport events. So far six lakh Hero Honda owners have been made members and we would like to soon get to a million figure. Some more initiatives on the aegis of Passport Program are planned for the year 200203. Another customer related initiative has been the

Increase of warranty period to two years since July 2001. This has attracted a great deal of customer attention. During the year the company has added nearly a hundred dealerships and SSPs. In terms of sheer numbers, the network has grown by 16% during the year 2001-02. We would endeavor to increase our reach to every corner of this country. On the operation side after the successful launch of ERP (SAP) last year, the company has now taken up its extensions to cover Human Resource division this year. Also, under consideration of extending the network to dealers, vendors and other associates. The idea is to increase the network capability to bring about efficiency in operations and also in our response to changes in the market.

Plans for the future Hero Honda’s performance has been more than satisfactory; it has earned substantial operating margins from a primarily engineering-based manufacturing business. All its stakeholders–promoters, suppliers, dealers and investors–are involved in its growth. It is sure it will maintain margins and grow at 12-15 per cent over the next two-three years, in line with the industry. The company aims to garner 35 per cent of the motorcycle market in the current financial year and has set a growth of 26 per cent for the year. Hero Honda has maintained its overall market share of 43-45 per cent in the motorcycle segment. While in the executive segment the company has lost its market share, it has gained a significant market share in the entry-level segment. Motorcycle and step-through sales fell 3.3 per cent in March 2003 but posted a modest six per cent growth in April 2003. With the launch of the of the 100cc motorcycle CD Dawn and the 223cc Karizma the product portfolio of the company now caters to a wide cross section of riders. Hero Honda Motors Ltd. (HHML) has attained the distinction of being the largest twowheeler company in the world in volume terms. With a new factory on the anvil, it is gearing itself for Operation One Billion, targeting $1 billion revenues in 2002-03. "Next year, we will enter the (dollar) billionaire's club (in revenues). After Operation Million for volumes in 2001-02, our slogan for the next year is Operation One Billion, said Mr. Pawan Munjal, Director & CEO, HHML.

VARIOUS MODELS OF HERO HONDA MODEL: AMBITION

MODEL: CBZ

MODEL: CD100 SS

MODEL: CD-DAWN

MODEL: PASSION

MODEL: SPLENDOR

MODEL: KARIZMA

ACHIEVER

NET SALES OF HERO HONDA BIKE IN FOLLOWING YEARS: 1985-86 1989-90 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06

43,000 units 96,200 units 5,30,600 units 7,61,210 units 10,29,555 units 14,25,195 units 16,77,537 units 20,70,147 units 26,21,400 units 31,24,460 units

ACHIEVEMENTS AWARDS AND ACCOLADES 1992

Harvard Business school Awarded for Good Corporate Performance

1993

National Productivity Council Awarded for ‘Best performance in the Automobile Sector.

1994

Hero Honda Chairman declared business man of the year, by Business India magazine.

1995

National small Industries Corporation Ltd. Hon Ours our chairman with the National Award for outstanding contribution towards development of small scale Industries.

1998

Hero Honda becomes Number- 1 motorcycles Brand.

1999

Hero Honda receives ISO 14001 Certification for environment conservation.

2000

Splendor becomes the World’s number –1in two wheeler brand. National Productivity Award for best performance in Automobiles and tractor sector.

2001

Ranked amongst the top 10 Indian Companies by the Far Eastern Economies Review. Becomes World’s number –1 largest selling two wheeler.

SALES

2000000

1680478

1677537

1800000 1600000

1750398

1469394

1425195

1400000 1200000

1029555

1000000

761210

800000 600000

530600

400000 200000 0 1998-99

1999-00

2000-01

2001-02

2002-03

2003-04

2005-06

2006-07

MARKET SHARE 9% 23%

43%

25%

Hero Honda

Bajaj

TVS

Others

COMPANY PROFILE OF TVS MOTORS TVS Motor Co. is the flagship company of the TVS Group. The TVS group was established in 1911 by Sri T.V. Sundaram Iyenger. TVS group commands a strong

presence in manufacturing of two-wheelers, auto components and computer peripherals. TVS Motor Company's first launch was 50 cc Moped TVS 50 in August 1980. It is the first Indian company to introduce 100 cc Indo-Japanese motorcycles in India in 1984. It was also the first Indian company to launch indigenous scooterette in India in 1994. It has grown rapidly since it's beginning to become one of the prominent two-wheeler manufacturers in India. Today TVS is a well-known brand in the field of bike manufacturing. The manufacturing unit of TVS Motor is located at Hosur and Mysore.

The TVS models are:-

• • • • • • • • • • • • • • • • • • • •

TVS Apache Centra Fiero F2 Fiero FX Max 100/R Samurai Scooty Scooty Pep Spectra Star Star City Star DLX Suzuki Fiero Victor Victor Edge Disc Victor Edge Drum Victor GLX Victor GX XL Super XL Super HD

CHALLENGES May 2001 found TVS Motor Company facing the daunting task of rolling out mySAP ERP across its offices and two manufacturing units without a dedicated connection/ leased line to its plants. Though the company used the services of Satyam Infoway, for setting up a VPN, a dedicated connection was required from Satyam's POP in Bangalore to Hosur, where TVS Motor's primary manufacturing unit was located. Satyam was counting on a bandwidth service provider (Spice Telecom) to provide the necessary physical link. Unfortunately Spice has its POP only in Attibele, Karnataka, which is seven kilometres from Hosur. Similarly, a physical link was not present from Spice Telecom's POP to TVS Motor's secondary manufacturing unit at Nanjangudu, with Spice's POP being six kilometres away from the Nanjangudu unit.

MILESTONES 2006:Houser, May 2, 2006: TVS Motor Company has begun the new fiscal on a spirited note recording 53 per cent sales growth in motorcycles in April 2006. As against sale of 52,825 units in April 2005, the company clocked sales of 80,862 units in April 2006. Buoyed by the motorcycle growth, the overall two wheelers recorded 1,24,917 units in April 2006 compared to 92,400 units in the year ago period, recording a growth of 35% Recently, the company launched feature-packed new versions of TVS Star City and Victor GLX with alloy wheels. The company launched a new advertising campaign for the Star City brand featuring its latest brand ambassador Mahindra Singh Dhoni. TVS Apache that has won wide acclaim as the best bike of the year has met with an encouraging response in all the markets that it has been launched in the last two months. The company is in the process of ramping up production and spread its availability in more towns in the coming months. According to a recent study by Boston Consulting Group and the CII, TVS is among the list of 100 companies chosen from 12 rapidly developing economies that are emerging as global challengers. The company is a recipient of The Deming Prize for Total Quality Management, the hallmark of Quality.

2005:TVS APACHE, the all new 150 cc bike makes a debut The Apache is the new 150 CC, 5 speed stunner of a motorcycle created to be the leader of the 150 CC motorcycle class with respect to acceleration, performance, styling, ride handling, and stability. With its sporty and chiseled looks and unmatched performance packed with superior engine technology, the Apache is sure to be a head turner. Apache’s engine is powered by 13.5 Brake Horse Power (bhp) and, with the highest power to weight ratio in its class, the bike is slated to be the fastest off the block in the 150 CC categories. The Apache has been designed and engineered to woo youngsters on the look out for a motorcycle that is aggressive and sporty looking with class leading performance. This racing inspired sleek machine characterizes unique engine features, innovative design, international looks, advanced engineering and technical excellence offering an exhilarating combination of sporty performance and exceptional ride comfort in highways and city roads. With the Apache, TVS is now set to redefine the 150 CC segment. With this launch TVS aims at strengthening its position in the premium segment of the motorcycle and consolidate further on total volumes.

DYNAMIC FEATURES OF APACHE • 150 CC, 5 speed, 13.5 bhp motorcycle • Intake and Exhaust (IE) surge with intake and exhaust resonator which excellent initial pick-up and greater acceleration

translateto an

• Inductive Digital Ignition (IDI) engine with lean burn technology • The Roller Cam Follower (RCF) technology for low friction engine for greater mileage and durability • The convenience of all gear start • Synchronized stiff chassis making it easy to maneuver through heavy traffic and have precise control at high speeds • Monotube Inverted Gas filled shock absorbers giving greater ride comfort • Athletic look, black alloy wheels and special paint giving the Apache a sporty styling • 17 inch front wheels and 18 inch rear wheels giving it a sporty stance • Wider tyres giving better road grip • 240 mm disc brakes for effective braking • Handle bar balancing mass for very low vibrations

TVS Motor sales touch highest ever 13, 42,257 units in 2005-06 Hosur, April 1, 2006 - TVS Motor Company (TVS M) has closed the financial year 200506 with 19% growth in the sale of motorcycles. The motorcycles sales recorded 8, 06,708 units compared to 6, 79,099 units in the financial year 2004-05. The total two wheeler sales witnessed 15% growth by clocking 13, 42,257 units compared to 11, 67,016 units recorded in the previous financial year The launch of popular models with fresh new features added to the significant sales growth in March. A feature-packed new version of TVS Star City was launched with alloy wheels. Victor GLX too was launched with alloy wheels and fresh new graphics. TVS Apache, the new 150 cc sensation with 5-gears and the winner of ‘bike of the year’ awards by all the leading Auto Magazines has received overwhelming response in the markets where it has been launched in March. TVS Motor Company Limited, the flagship company of the USD 2.7 billion TVS Group, is the third largest two-wheeler manufacturer in India and among the top ten in the world, with an annual turnover of over USD 740 million. The company is the only two-wheeler manufacturer in the world to be honored with the hallmark of Japanese Quality – The Deming Prize for Total Quality Management.

TVS Scooty

TVS VICTOR GLX

VARIOUS MODELS OF TVS TVS Max 100

TVS VICTOR GL

TVS APACHE

RESEARCH DESIGN:•

Descriptive Research

For this research I did two types of surveys (Data source):

A. PRIMARY SURVEY •

Conducted by taking views of the customers using this model of Hero Honda and TVS. Their view points about the model, their grievances/ complaints about it. Last but not the least their views about modification required in it.

B. SECONDARY SURVEY •

Conducted gaining information from different magazines, newspaper, personal interviews, web sites, company annual reports, telephone discussion, personal discussion. It is one of the best methods to collect data because of economy in terms of time and money.

Data Collection The data collection is the gathering of needed information for making fruitful decisions that helps in successful completion of the project. Data collection is either structured or unstructured depending upon the study, Questionnaire method was found to be most effective. The questionnaire was structured and non-disguised. There was also face-to-face conversation between the researcher and the respondents; the respondents were also provided feedback and clarifications behind the questions. This was deemed necessary in order to enable the respondents understand the questions in the same context, as the researcher wanted. This calls for collection of both primary and secondary data. In the present project work, both types of data are collected for achieving the objectives of present research study.  Primary Data These are those that are collected afresh for the first time, and thus happen to be original in nature. Such data are administered by the authorities who

themselves are responsible for their collection. Methods used for collecting it are Observation and Questionnaire.  Questionnaire: -

It is a formalized schedule to obtain and record specified and relevant information with tolerable accuracy and completeness. As such it directs the questioning process and promotes clear and proper recording. The questionnaire method has been used for the present study as shown in the annexure. Once the questions have been addressed the next step concerns the type of responses/questions. Questions can be classified into two groups: a) Open-ended Questions- here lists of acceptable responses are not provided to the respondent and they may answer in his/her own words.

a) Close- ended Questions- here list of acceptable responses is provided to the respondent. Dichotomous subtype questions are used for the present study. This allows only two possible answers. These questions are generally easy to ask and answer.  Survey: -

Discussions with branch head of the bank The Structured questionnaire was administered to the selected sample size of 50.  Secondary Data These are those which have already been collected by someone else and which have been passed through the statistical process. The sources of secondary data used for the present study include Internet, company journals and magazines. The secondary data has been scrutinized before compilation to access it’s suitability, reliability, adequacy and accuracy

SAMPLE SIZE AND TECHNIQUES:The research instrument used was a structural questionnaire.

SAMPLING PLAN a) Sampling unit: The sampling unit constituted the people in The middle income going in for bikes.

b) Sampling size: the sample size consists of 45 customers, out of which 5 refused to fill the questionnaire and 5 forms were found incomplete.

c) Sampling procedure: Convenience sampling.

ANALYSIS PATTERN

RESEARCH TECHNIQUES A wise consumer comparison-shops for goods and services by evaluating quality, price, location and service. Likewise trainers seek the most effective methods for conducting needs analysis and for the evaluation of the training delivered. This means determining how to obtain the useful information which to make decisions about training program design and evaluation. Once we have selected the best method to acquire the information needed, how this method is putted into practice. In this context following questions must be asked:  What data do I need?  What are the sources of data?  How do I go about collecting them?  How will I analyze what I have collected?  What does all collected data mean?

The term data refers to bits and pieces of detail from which information is derived; therefore information is data that have been compiled in a useful way. Data and information are not synonymous but complimentary. Decisions are made from conclusions, which are obtained from information and information comes from data. The essence of research begins with the definition of a problem to be addressed. This step is followed by identifying what is already known about the issue. This, in turn, is often followed by some educated guesses, called hypotheses-the relationship between two or more variables-that might be involved in solving this problem. All research tends to follow basically the same pattern. Identifying the issue to be studied Determining what is already known about problem Making assumptions about the problem Identifying method to collect needed data Choosing or developing instruments that will results in collection of valid data  Collecting the data  Distilling the result of this collection  Formulating conclusions and recommendations that address or resolve original problem     

MARKETING Marketing is a social and managerial process by which individuals and groups obtain what they need and want through creating, offering and exchanging products and values with each other. In this way marketing is a business function that identifies customer needs and wants, determines which target market the organization can serve best, and designs appropriate products, services, and programs to serve these markets. Marketing is much more than isolated business function it is the philosophy that guides the entire organization. The goal of marketing is to create customer satisfaction profitably by building-value laden relationship with important customers as well as fulfill certain organizational objectives. People throughout the various kinds of organizations-product or service, profit or nonprofit, domestic or global, small or large, need to know how to define and segment a market and how to position themselves strongly by developing need satisfying products

and services for chosen target segment. They must know how to price their offerings to make them attractive and affordable and how to choose and manage intermediaries to make their products available to customers. And they need to know how to advertise and promote products so customers will know and want them.

MARKETING MIX PLAN Demographic Segmentation •

Income: Our customer survey indicates that the segments available for the Hero Honda bike are the people with monthly income of Rs. 10,000 and above.

•

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 stylish,

brand conscious.

Behavioral segmentation: This segmentation is done considering user status, benefit wise.

Targeting The proposed targeting people in the age group of 18 years and above with a monthly income of Rs. 10,000 and above, who are adventurous, enthusiasts and socializing and who are either students or retired individuals or may be employed as professionals, government servants or having their own business, but mostly male.

Positioning The image that Hero Honda creates in the mind of the customers is the faith. The add shown by it says “Desh ka Dhadkan”. That means it’s 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. The 4 factors affect it are:

Product - The tangible offer to the market, which includes the product quality, design, features, branding and packaging. The product is perfectly designed and all the switch are well placed, which provides a good riding condition

Price – Pricing is an important component of marketing mix of firm. Determining the prices of different products of a firm is a very difficult task of the marketing manager. Price denotes money value of a product. It represents the amount of money for which a product can be exchanged. In other words, prices represent the money which the buyer pays to the seller for a product price represents the exchange value of goods and services in terms of money. Price is all around. Price factor has very well been touched by the manufactures. The manufactures (Hero Honda) are charging very comparatively cheaper prices then their competitors. The pricing strategy of the company is very set. They price their product according to the cost of production and also by keeping an eye on the price of the competitors of that segment & demand of the product in the market. The pricing strategies adopted by Hero Honda Ltd. The management of a firm decide to fix the price at the competitive level. This method is adopted by Hero Honda because the bike market is highly competitive. The amount of money that customer pays for the product. The price of the product should commensurate with its perceived value. If does not, the buyers will turn to competitors products.

Place – Includes the various activities the company undertakes to make the product accessible and available to a large number of target customers. • There are about many regional offices located in major cities through out the country. • There are more than 10,000 dealers through out the country. •

For the product distribution the company distributes its products through authorized dealers.

• The variety products are easily available in showrooms.

Promotion – The fourth marketing mix tool, includes all the activities the company undertakes to communicate and promote its products to the target market. It consists of advertising, sales promotion, public relations, and direct and online marketing.

The various promotional activities adopted by the Hero Honda Company. The company has 100crore rupees for its promotional activities out of which 75% is sponsored by the company and 25% from the dealers. They may sign a celebrity for its promotional activities in recent futures. The company provides six free services to its customers in comparison to its competitors.

The company provides good services facilities to its customers through dealer’s service station. Dealers encourage its customers by giving discount, providing 0% interest loan schemes, prices, coupons etc.

The various promotional activities adopted by Hero Honda bikes are as follows  Credit & finance schemes  Free services to the consumers  Advertisements on Televisions, Newspapers, Magazines  Road Shows  Free trials for the new consumers

RESULTS  Companies data shows that the company produces approximately 1, 11,000 vehicles per month. Out of which they sales 60,000 motor cycles per month.  The company has more demand of its product in western region.  The company has 21 regional offices throughout India out of which 10 contains training centers.  The main objective of these offices is to pay emphasis to human resource development and provide good services to its customers.

Customer: The results from customer survey are as follows: 1.

Customers prefer because of their fuel efficiency.

2.

Customers prefer because of their performance.

3.

Customers prefer because they are value added product.

4.

Customers also prefer because they are stylish.

IDENTIFIED INDEPENDENT AND DEPENDENT VARIABLES

MARKETING COMMUNICATIONS “Walk the Talk” though Advertising, sales Promotion, Public Relations, through an emerging Media, including the Web these things are done through. ♦ Promotional Methods ♦ Promotional Mix ♦ Advertisement ♦ Sales promotion ♦ Public Relations ♦ Event Management ♦ Media Management ♦ Budgeting ♦ Measuring Effectiveness And much more……………….. The internet’s greatest potential has been superbly exploited by the small business ventures to reach customers directly. The market had virtually opened quickly to market changes by providing accurate market intelligence, faster communication and greater planning time. This helped to reduce the market volatility the dealer to understand the significance and value of e-commerce and benefits of embracing the latest in information technology, and initiate concrete steps to capitalize on it. The marketing is also done through sales promotions, Advertisement, publicity, etc.

Strong dealer relationship expands the scope of the commercial paper programme in an organization and Hero Honda is doing that. They are doing the communication through newspaper, magazines and television channels, etc.

CONTENT ANALYSIS

SWOT ANALYSIS OF HERO HONDA Strengths: •

Technological support from Honda Motors, Japan.

•

The company has a deeply penetrated dealer network.

•

The company provides good after sales service through its well-established dealer network.

•

The company enjoys a huge market share and well established brands like Splendor, Splendor +, Passion, CBZ, Ambition, etc.

•

New CBZ Extreme for Sporty look.

Weaknesses: •

Hero Honda depends on Honda for new products and this is a big weakness considering it from the post 2005 point of view. The reason being that the technological tie-up between Hero Honda and Honda Motors of Japan will cease to exist.

•

The company doesn't have a product catering to Rs. 25,000 - Rs. 30,000 segment, and the company might suffer on account of this as the imported motorcycles and foreign players' motorcycles are expected to cater to this particular segment of the market. This can result in fall in the market share of the company.

•

The company imports about 31% of its spare requirements. This makes the company vulnerable to the import policies of the government. It also exposes them to the exchange rate risk.

•

Not able to counter the Bajaj Pulsar, and TVS Apache success in the market.

Opportunities: •

The motorcycle segment is growing at the rate of 33%, which provides a great opportunity for the company to cash on.

•

Also it is experiencing a shift in the customer preference for 4-stroke mobikes. This again provides an excellent opportunity to Hero Honda to leverage its market share and market leadership for sustained profitability.

•

Market needs better look and pick up with stylish appearance.

Threats: •

Wide acceptance of Bajaj Pulsar in the market. Market share of Bajaj and TVS is increasing.

•

The company has plans to foray into the scooter segment, which can also be a major threat for the future prospects of the company. The reason being that the consumers are shifting from scooters to motorcycles and at this hour moving from motorcycles to scooters doesn't sound logical. Motorcycles form the major chunk of the sales revenue of Hero Honda. A small proportion of the revenue comes from the sales of spares.

SWOT ANALYSIS OF TVS MOTOR Strengths: •

Technological support from Suzuki Motors, Japan.

•

The company has a deeply penetrated dealer network.

•

The company provides good after sales service through its well-established dealer network.

•

The company enjoys a huge market share and well established brands like Victor GLX, Star City, Max 100, Apache etc.

Weaknesses: •

TVS Motor depends on Suzuki for new products and this is a big weakness considering it from the post 2005 point of view. The reason being that the technological tie-up between TVS Motors and Suzuki Motors of Japan will cease to exist.

•

The company doesn't have a product catering to Rs. 25,000 - Rs. 30,000 segment, and the company might suffer on account of this as the imported motorcycles and foreign players' motorcycles are expected to cater to this particular segment of the market. This can result in fall in the market share of the company.

•

The company imports about 21% of its spare requirements. This makes the company vulnerable to the import policies of the government. It also exposes them to the exchange rate risk.

Opportunities: •

The motorcycle segment is growing at the rate of 17.68%, which provides a great opportunity for the company to cash on.

•

Also it is experiencing a shift in the customer preference for 4-stroke motor bikes. This again provides an excellent opportunity to TVS Motor to leverage its market share and market leadership for sustained profitability.

Threats: •

The technical collaboration with Suzuki was valid only till 2005 and this is a serious threat as they have been dependant on Suzuki for technology. Also Suzuki has set up its 100% subsidiary in India which shall start producing motorcycles from 2004. This will further increase the competition.

•

The company has plans to foray into the scooter segment, which can also be a major threat for the future prospects of the company. The reason being that the consumers are shifting from scooters to motorcycles and at this hour moving from motorcycles to scooters doesn't sound logical.

•

Popularity of Bajaj Pulsar in the market.

APPLIED STATISTICAL TOOLS In probability theory and statistics, correlation (often measured as a correlation coefficient) indicates the strength and direction of a linear relationship between two random variables. That is in contrast with the usage of the term in colloquial speech, denoting any relationship, not necessarily linear. In general statistical usage, correlation or co-relation refers to the departure of two random variables from independence. In this broad sense there are several coefficients, measuring the degree of correlation, adapted to the nature of the data. Rank correlation coefficient

CHAPTER-III OBJECTIVE WISE ANALYSIS (MICRO ANALYSIS)

OBJECTIVE WISE ANALYSIS 

To study the marketing mix of Hero Honda & TVS Motors. 4’PS OF MARKETING OF HERO HONDA

PRODUCTS 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. Among these we are going to analyze only three – (1) CBZ, (2) Ambition and (3) Splendor (4) Splendor +. •

CBZ

•

Ambition

•

Splendor

•

Splendor +

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 manufacturers are charging very comparatively cheaper price i.e. Rs 45000 approx. The pricing strategy of the company is very set. They price their product according to the cost of production and also by 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 them selves 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. I fixes customer centric pricing that provide customer total satisfaction. Hero Honda’s 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 HERO HONDA HAS direct contact with the dealers. There are no middlemen involved. The dealers directly sell to the customers. The channel is of 1st level which has only the dealers as the link between the customers and the company.

What Does Customer Want? The customers of Hero Honda, according to the Asst. Manager (Sales) are very particular about the colors that Hero Honda offers in its wide variety of scooters. He said that the customers are very much aware of their purchase. Gone are the days when the sales people could influence the buyer to buy a particular product. Almost 90-93% of the customer, whoever comes to the showroom? Usually comes after he/she had made a decision. So, the work of the sales person is less. The rest 7-10% have some doubts with regard to the

purchase of Hero Honda. It is here, where the sales persons have to do some work in convincing the customers about the scooter. The sales person in this regard conveys the customers about the mileage, strokes and also the parameters that the customers enquire.

How Is The Price Determined According To The Change? Manufacturer, on the basis of the cost of production determines the price and the factors like tax and others. Usually the sales tax on the two wheelers is 8% but in Hero Honda it 4%. This is because Delhi Government has found out that the pollution from Hero Honda is very less due to the catalytic converter which every model of Hero Honda have. The government has identified that by using the catalytic converter Hero Honda is helping the environment which is a social cause. Hero Honda Bikes not only have market in India, but also in abroad. To maintain the differences in market of the different companies it takes the help of the local manufacturers or the dealers outside for the distribution of their scooters smoothly.

PROMOTION BY HERO HONDA 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 Honda’s latest DKD –2 commercial its two brand starring its Ambassador and India’s heart throbs, Hritik Roshan and Sourav Ganguly, truly reflects the multi fact roles that today’s 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 vibrant and 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 today’s heart throbs, Hritik and sourav, 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. 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.

Hero Honda

:

Leading the way.

4’PS OF MARKETING OF TVS MOTOR COMPANY PRODUCTS • • • • • • • • • • • • • • • • • • •

Centra Fiero F2 Fiero FX Max 100/R Samurai Scooty Scooty Pep Spectra Star Star City Star DLX Suzuki Fiero Victor Victor Edge Disc Victor Edge Drum Victor GLX Victor GX XL Super XL Super H

With the Apache, TVS is now set to redefine the 150 CC segment. With this launch TVS aims at strengthening its position in the premium segment of the motorcycle and consolidate further on total volumes.

ADVERTISEMENT OF TVS MOTORS TWO-WHEELER major, TVS Motor Company, has come up with an improved performance for the first quarter of this fiscal. The company continues to ride on the success of the recently-launched four-stroke model, Victor. For the quarter ended June 2002, the turnover increased about 54 per cent to Rs 629.97 crore. The `Victor' ride: The sharp spurt in motorcycle sales volume has been the key driver of revenues. The sustained demand growth for Victor, coupled with the recovery in sales volume of the two-stroke model, Max 100, aided an 88 per cent jump in motorcycle sales volume. Victor's success has improved the company's product-mix. An indigenously developed product, the profit margin on Victor is relatively high, compared to Fiero and other brands. This, in turn, has pushed up the operating profit margin to 9.23 per cent from 7.38 per cent in the corresponding previous quarter. The margin expansion would have been even better, but for the increase in staff cost and other expenditure. TVS Motor had signed up Sachin Tendulkar as its brand ambassador. Notably, other expenditure (including advertisement and promotional costs) increased to Rs 98.66 crore from Rs 69.42 crore. The post-tax earnings increased 149 per cent to Rs 26.78 crore. The growth in net profit was stunted by a rise in taxation provision to Rs 12.26 crore from Rs 3 crore in the 200001 first quarter. Deferred taxation of Rs 3.34 crore also played a part in pulling down the bottom-line for TVS Motor. The company's performance continues to ride on Victor. There is no evidence of slackening of demand for this model with a 113 per cent rise in motorcycle sales in July 2002. TVS Motor Company, India's premier two-wheeler manufacturer launched the TVS Cup One Day International (ODI) Trination Series between India, Australia and New Zealand in Chennai on October 22, with the symbolic unveiling of the TVS Cup. At a press conference, Harish Krishnamachar, Vice President, Marketing, TVS Motor Company unveiled the glittering TVS Cup alongside Indian Skipper Rahul Dravid and New Zealand Skipper.

PROMOTION OF TVS MOTORS Promotions at all cities hosting the matches will give everyone a chance to be a part of the fun filled experience surrounding this event. TVS customers will get an opportunity to participate in 'pitch on wheels', which is a 'hit wicket get ticket promotion" which began on October 19. 'Pitch on wheels' is a promotional activity wherein a vehicle promoting the match would make a round of the whole city prior to each match. The spectators at the stadium too will be treated to a whole lot of entertainment in the form of music and dance during breaks in the games. There would also be lucky draws for everyone in the stadium with TVS bikes as prizes

How does TVS Motor create value for its customers and measure satisfaction levels? In addition to continuous innovation to improve the performance, features and durability of our two-wheelers, we also benchmark the sales of the products and service processes to offer better value to the customer. Customer service is provided through a large network of fully equipped dealers, authorized and certified service points. The service network is equipped with state of the art workshops, hydraulic and pneumatic equipment, carbon emission devices, etc. A network of authorized spare parts stockiest has also been set-up to ensure timely supplies. We commission customer satisfaction surveys through specialist agencies on a continuous basis to monitor the feedback, which is benchmarked to improve product performance and satisfaction. The company was ranked second in overall customer satisfaction and TVS Centra emerged as the top choice in the executive segment. Since dealers are the first customers, a comprehensive dealer management system (DMS) is being introduced to improve dealership sales and services processes. Regular meetings of select groups of dealers, designated as 'presidents club' and 'antenna club', are conducted to obtain feedback on customer's expectations and solve customer problems.

 To study various promotional strategies and know about the current strategies keeping in mind the cutthroat competition between Hero Honda & TVS Motors.

Hero Honda CELEBRITY ENDORSEMENT

Hero Honda has roped in film actor Hrithik Roshan, Former Captain of Indian Cricket team Sourav Ganguly, Mohammed Kaif, Harbhajan Singh, Zaheer Khan, Yuvraj Singh and Virender Sehwag as its brand ambassadors. The four players will join the current Hero Honda brand ambassador and Former captain of the Indian team, Sourav Ganguly, to form the Hero Honda `Team Ambition'. Incidentally, the `Ambition' is also Hero Honda's latest launch in the market. Announcing the formation of the Hero Honda `Team Ambition', Mr. Pawan Munjal, said, "Indian Cricket and Hero Honda have both made the nation proud and helped the world recognize India's potential The `Team Ambition' would also provide coaching and guidance to the budding talent in the country and support cricket projects undertaken by Hero Honda in India and abroad, a company release said. Hero Honda will keep up its promotional activities with emphasis on cricket and entertainment. The company claims that its Desh Ki Dhadkan campaign featuring brand ambassadors Saurav Ganguly and Hrithik Roshan has received a very good response and helped build the company's image. Last year, the company spent around Rs 90 crore on advertising and marketing.

SALES PROMOTION OF HERO HONDA A fundamental concern of any customer during the purchase of a double product is the quality and provision of efficient service. After all queries on product quality, performance, features and benefits have been satisfied, the customer invariably focuses on the service factor for the product as the end objectives is to ensure trouble free operation. In this respect servicing acquires paramount importance and Hero Honda’s focus and emphasis on these key result area have been instrumental in establishing its superiority and technological edge in the market. The host of training programmes and relationship enchantment activity additionally backs the spates of servicing camp, organized throughout the country. The active support of servicing and co-operation rendered by the dealer in the form of logistics and infrastructure further aid in making such programmes highly meaningful and valuable. They are doing free check up camps reinforce customer trust. Service advisor’s collecting information from a customer about his satisfaction level after the servicing of their bike. For the promotion of products the Hero Honda dealer rally. Hero Honda is organizing so many events in sports, cultural programmes, film -festivals etc for the promotion of the product eg. Hero Honda NKP salue Challenger Cricket Cup brings new talent to the force, MALTA Junior Tennis Tournament, Hero Honda social’s Commitment rehabilitating children affected by violence, operational, Relief, donation for drought relief, Rota Trade Mela 2000, Road Show, Training programmers to enhance quality of service, free back up camps reinforce customer’s trust, ride safe programmes held for Delhi Traffic Police, Mobile Revolution in servicing etc. The powerful benefits of test rides, special promotions and communication drives to draw in the initial customers, preparation of accurate customer information forms to create a customers database, offer of finance facility and active steps to impart specific transiting at the dealer’s sales and services levels would be essential steps to achieving the brand and the company objectives. Mr. Uppal also touched upon the servicing policy for passion and cautioned the invitees to remain alert for substitution in Hero Honda brands among its customers. The sales increase would have do be targeted from new customers and not its existing ones. The key attitude that would constantly contribute towards sales would be total and passionate commitment.

PUBLICITY OF HERO HONDA For the purpose of publicity Hero Honda is always organizing different events, etc. and they are always inviting celebrities from film, sports, media, politics, etc. There is some of event and parties are as follows:The Hero Honda stardust millennium Honours and BFJA awards for Bengali films. In a gesture that honors and salutes some of the finest talent in south Indian Cinema. Hero Honda also security sponsored the 20th Cinema Express Awards. The sponsorship of the women’s World Cup in 1997 came next, then the ICC Cricket World Cup 2003. Hero Honda, the largest two wheeler leader in Indian sponsored the 21st Cinema express Awards. Marketing Convention 2001. They are Priyanka Chopra, Miss World, Lara Dutta Miss Universe, Diya Mirza Miss Asia Pacific, Sourav Ganguly Indian Cricket Captain, Dealer Mehndi, Mr. Harsha Bhogle the famous cricket commentator etc. Dandiya programme at Kota and Banswara. In this Ms Sunita Rao, the popular singer entertains at the festivals at the Dandiya Programme. Thrill and the excitement at the Hero Honda Master Golf tournament. In this tournament Kapil Dev, virendra sehwag, Pronoy Roy, Milkha Singh and so many celebrities were present.

TVS MARKETING OF TVS MOTOR TWO-WHEELER major, TVS Motor Company, has come up with an improved performance for the first quarter of this fiscal. The company continues to ride on the success of the recently-launched four-stroke model, Victor. For the quarter ended June 2002, the turnover increased about 54 per cent to Rs 629.97 crore. The `Victor' ride: The sharp spurt in motorcycle sales volume has been the key driver of revenues. The sustained demand growth for Victor, coupled with the recovery in sales volume of the two-stroke model, Max 100, aided an 88 per cent jump in motorcycle sales volume. Victor's success has improved the company's product-mix. An indigenously developed product, the profit margin on Victor is relatively high, compared to Fiero and other brands. This, in turn, has pushed up the operating profit margin to 9.23 per cent from 7.38 per cent in the corresponding previous quarter. The post-tax earnings increased 149 per cent to Rs 26.78 crore. The growth in net profit was stunted by a rise in taxation provision to Rs 12.26 crore from Rs 3 crore in the 200001 first quarter. Deferred taxation of Rs 3.34 crore also played a part in pulling down the bottom-line for TVS Motor. The company's performance continues to ride on Victor. There is no evidence of slackening of demand for this model with a 113 per cent rise in motorcycle sales in July 2002.

ADVERTISEMENT OF TVS MOTORS TWO-WHEELER major, TVS Motor Company, has come up with an improved performance for the first quarter of this fiscal. The company continues to ride on the success of the recently-launched four-stroke model, Victor. For the quarter ended June 2002, the turnover increased about 54 per cent to Rs 629.97 crore. The `Victor' ride: The sharp spurt in motorcycle sales volume has been the key driver of revenues. The sustained demand growth for Victor, coupled with the recovery in sales

volume of the two-stroke model, Max 100, aided an 88 per cent jump in motorcycle sales volume. Victor's success has improved the company's product-mix. An indigenously developed product, the profit margin on Victor is relatively high, compared to Fiero and other brands. This, in turn, has pushed up the operating profit margin to 9.23 per cent from 7.38 per cent in the corresponding previous quarter. The margin expansion would have been even better, but for the increase in staff cost and other expenditure. TVS Motor had signed up Sachin Tendulkar as its brand ambassador. Notably, other expenditure (including advertisement and promotional costs) increased to Rs 98.66 crore from Rs 69.42 crore. The post-tax earnings increased 149 per cent to Rs 26.78 crore. The growth in net profit was stunted by a rise in taxation provision to Rs 12.26 crore from Rs 3 crore in the 200001 first quarter. Deferred taxation of Rs 3.34 crore also played a part in pulling down the bottom-line for TVS Motor. The company's performance continues to ride on Victor. There is no evidence of slackening of demand for this model with a 113 per cent rise in motorcycle sales in July 2002. TVS Motor Company, India's premier two-wheeler manufacturer launched the TVS Cup One Day International (ODI) Trination Series between India, Australia and New Zealand in Chennai on October 22, with the symbolic unveiling of the TVS Cup. At a press conference, Harish Krishnamachar, Vice President, Marketing, TVS Motor Company unveiled the glittering TVS Cup alongside Indian Skipper Rahul Dravid and New Zealand Skipper.

SALES PROMOTION OF TVS MOTORS Promotions at all cities hosting the matches will give everyone a chance to be a part of the fun filled experience surrounding this event. TVS customers will get an opportunity to participate in 'pitch on wheels', which is a 'hit wicket get ticket promotion" which began on October 19. 'Pitch on wheels' is a promotional activity wherein a vehicle promoting the match would make a round of the whole city prior to each match. The spectators at the stadium too will be treated to a whole lot of entertainment in the form of music and dance during breaks in the games. There would also be lucky draws for everyone in the stadium with TVS bikes as prizes

How does TVS Motor create value for its customers and measure satisfaction levels? In addition to continuous innovation to improve the performance, features and durability of our two-wheelers, we also benchmark the sales of the products and service processes to offer better value to the customer. Customer service is provided through a large network of fully equipped dealers, authorized and certified service points. The service network is equipped with state of the art workshops, hydraulic and pneumatic equipment, carbon emission devices, etc. A network of authorized spare parts stockiest has also been set-up to ensure timely supplies. We commission customer satisfaction surveys through specialist agencies on a continuous basis to monitor the feedback, which is benchmarked to improve product performance and satisfaction. The company was ranked second in overall customer satisfaction and TVS Centra emerged as the top choice in the executive segment. Since dealers are the first customers, a comprehensive dealer management system (DMS) is being introduced to improve dealership sales and services processes. Regular meetings of select groups of dealers, designated as 'presidents club' and 'antenna club', are conducted to obtain feedback on customer's expectations and solve customer problems.

 To focus on comparative marketing strategies of Hero Honda & TVS Motors. COMPARATIVE MARKETING STRATEGIES Hero Honda has 20% of Honda’s sales in the world and Honda Motor of Japan is proud to be associated with Hero Honda. As a staunch supporter, with technology and brand support from the global power house, Honda Motors, Japan, would immensely boost the business prospects in the country despite the onslaught of serve competition in the market place. ‘ it is our avowed aim that Honda Motors’, scooters and Hero Honda’s motorcycles would together corner 50% of the market share of two wheeler in the country’. Primary among these were the National Customer Survey by IMRB with a record 25,000 interviews, making it the largest two-wheeler survey. This way followed up by the National Customer satisfaction survey in September 2000. In keeping with “Top Gear”, the company also established customer finance tie-ups with Centurion Bank and Tata Finance. In the present Scenario, this is available in 136 towns and to 232 dealers a leading to a current volume of around 6000 per month. This represents as much as 25% of the total customers financing. The dealers finance tie-ups with Citi Bank and Centurion Bank. The current sanctions to as many as 189 dealers were worth Rs.61Crore, he revealed. There had also been no opportunistic ad hoc price increases. The company also took positive steps to facilitate the dealer “Authorized representative service extension policy. The corporate commitment to “we are” and the company’s emphasis on environment protection also resulted in opening the first effluent treatment plant at a dealership. New service training centers were also established at Delhi and Chennai. While quarterly product reviews were conducted with the factories, a unique programme of joint visits with quality department land Japanese staff was also introduced. On the spare parts front, multiple increases in spare policy was also overhauled and new, innovative actions were taken leading to a volume of over 6,000 bikes in the current year itself. The company also associated itself actively with sponsorship of armed forced rallies, notable among them being the Kargil Rally and the AOC Rally. While this built up its relationship with premier customers, the initiatives taken on other priority fronts were equally effective. Showroom standardization was effectively detailed. World event sponsorships also helped the company to achieve global exposure for its brand, particularly through such events as international spots tournament like the world Cup Cricket, held in England in 1999. Plans for participating in the ICC World Cup Tournament and sponsorships have already been finalized, right from the Mini World Cup 2000 at Kenya to World Cup 2003 at South Africa.

The company’s entry into the tournament events sponsorships was equally successful. Its sponsorship of Hindi Cinema awards(Millennium Honors held in Mumbai in January 2000, was followed up by sponsorship of Bengali cinema (BFJA Awards –Calcutta, August 2000) and then South Indian Cinema (Cinema Express Awards- Chennai, November 2000). A laudable achievements was also the signing of the two top Leaders, veritable ‘Desh ki Dhadkan’ in the field of sports (Cricket), and entertainment (Hindi films), three years. Sourav Ganguly and Hritik Roshan the two stalwarts in their respective fields were also designed as brand ambassadors for Hero Honda for a period of three years. The national Launch of the Hero Honda passport programme specifically targeted at enhancing customers relationships, the implementation of the Hero worldwide safety riding campaign at dealer Level, and support extended to dealer during the customer’s satisfactions survey. To streamline operations and sales administration, the company also introduced the service excellence awards for SSP’s decentralized the settlement of free service coupons reimbursement, reorganized the Dharuhera Service Center as the National Training Center, with latest technology to provide specialized advanced courses. Dealer level implementation of the integrated dealership software package was also another significant activity undertake. The major success was the volume and revenue increase of by over two and half times and a market share increase in motor cycles, from 36% to from 47% and in 2 wheeler, a doubling from 13% to 26%. For the current year ending 2001, the company would achieve a volume of over 1 million bikes under project “OM” and revenue in excess of Rs.3000 crore. The spare parts business itself was striving for revenues of Rs. 145 Crores. Service reporting at all authorized outlets would exceed the five million mark. The market perception inevitably revolved around the admirable achievement of Hero Honda as the No:-1 two wheeler company in India. It revealed that the total customer base of the company on a world wide basis had crossed the 4 million mark. The road envisaged in the light of these facts was just an ambitious with the emphasis being to sustain a growth rate of 15% per annum as well as be alert and responsive to new development particularly the resurgent and aggressive competition with new players and bikes as in addition to the China / WTO impact world trade organization. Hero Honda’s own marketing initiatives as well as the emerging potential of second hand motorcycle business. Key aspects in accessories business, social commitment and socially relevant programmers, and communications drives were also pointed out. Specific brand building and customers relationship exercise like the passport programme, satisfaction survey, safety riding, campaign, service extension assistance the various multi-levels training and development programmes, seminars and workshops, CBZ club, product quality reviews and field quality visits were all essential and Indispensable ingredients to achieve the required results. And for this the most vital input was inevitably the passion from one and all.

AUTO MOBILE SALES FIGURE

Bajaj Auto Ltd.

Hero Honda Motor

Kinetic Engg.ltd.

LML Limited

Royal Enfield Motors

TVS Motor Co.

Yamaha Motors India 0

100000

2004-2005

200000

300000

400000

2005-06

500000

600000

MARKET SHARE The auto two-wheeler segment has been witnessing a mixed trend in year 200304. During the first seven months, the scooter volumes dipped and there was a sudden spurt in the motorcycle sales. However there was some deviation from this trend during October 2004 when the scooter sales stated picking up due to launch of new variants by Hero Honda Ltd., But on the whole the motorcycle market continued to prop up domestic 2- Wheelers sales whereas scooters and moped sales maintained their downward trend in fiscal 2003. The sales of motorcycle segment remained buoyant in Dec 2001 and the major three players have reported an average growth of 55% in their sales volumes. Bajaj Auto Ltd. Has been the outperformed in the motorcycle segment followed by Hero Honda Motors Ltd. And TVS Motor Company Ltd. (formed after the break-off with Suzuki Motor Corporation, Japan) with the whopping 85% growth in the motorcycle sales Bajaj Auto Ltd. Is the second biggest manufacturer of motorcycles? Hero Honda has posted a negative sales growth of 8.75% from last month November 2001 which is attributed to lower registrations for new purchases by the customers in the last month of the year. With the rising rural demand the company is optimistic of reaching the sales target of 1.4 million units for the financial year ending March 2003-04.

MODEL

2

2006

005 Premium/lifestyle category (Rs 50000 and above) 45.25

29.16

Commuter/Smart Category (Rs 40000-50000)

64.80

56.16

Economy category (Rs 30000-40000)

21.71

32.95

The Growth/Share Matrix for Hero Honda Motors Limited: This matrix has often been used to examine the relative growth prospects of a firm’s line of products. In the matrix, activities are classified according to their growth rate and there competitive position or market share. Hero Honda Motors Limited is a Star which has high market share and a high growth rate. They developed fuel efficient motorcycles at a time when everyone was producing 2stroke motorcycles. This made them gain market share at a rapid pace and helped them to become the market leaders in the motorcycle segment. Having set its focus on customer satisfaction, the company is determined to provide products and services that meet the quality, performance and price aspirations of their customers. HHML wants to provide its customers with value for their money. Hero Honda's motorcycles account for over 45% of the entire motorcycles market. The various brands of Hero Honda are Splendor, CBZ, Passion, Sleek, and Ambition. Splendor enjoys nearly 30% of the total motorcycles market.

COMPANY

SALES UNITS 2006

MARKET SHARE

HERO HONDA

417014

46.01

BAJAJ AUTO

219554

24.22

TVS SUZUKI

162081

17.88

OTHERS

107673

11.88

STRATEGY 1. They must address the need for power in a new premium category and not in commuter bikes. 2. Consumers are basically looking for fuel efficiency, durability, style, power and price. Hero-Honda products the Splendor & Passion & TVS products the Victor GLX,Star City offer fuel efficiency and durability. CBZ & APACHE offers style. Power and price bikes. Now they must look for new products. 3. Not having proper in-house Product Engineering skills have caused Hero Honda dearly. They must hence improve in-house Product Engineering skills. 4. Lack of product creation skills also means that the speed at which Hero Honda launches new products is likely to be less than that of its rivals. Thus to launch new products at a speed in line with their competitors is one strategy that Hero Honda must look in to cash on. 5. The company uses both imported and indigenous raw materials and components to manufacture the motorcycles. As a result, the increase or decrease in the import tariffs has an impact on the company's bottom-line. The proportion of imported and indigenous raw materials, components and spares used in FY02 is as follows:

Alternate Recommendations: The two wheeler industry in India is experiencing a shift from Scooters to Motorcycles. In the motorcycles segment, the customers are shifting from 2-Stroke to 4-Stroke motorcycles citing fuel efficiency as a major reason. Hero Honda must catch on this opportunity. This has made the ride smoother for Hero Honda & TVS. But this coupled with the low cost of production has attracted MNC’s to enter India in a big way. This has been signaled by the arrival of Honda Motors, Japan, through its fully owned subsidiary. This has made the motorcycle companies to reduce their prices. Hero Honda has reduced the price of its leading brands by an average of Rs. 2300. This price cut is expected to have a positive impact on the demand for two-wheelers. The company is expected to face stiff competition from foreign players in the future and the technological tie-up with Honda is expected to cease by 2005. Hero Honda must hence try to reduce the cost of production and this can be achieved through reduction along the value chain.

FINDINGS  Motorcycles are mostly used by youth between the age group of 20-35 years.  Nowadays, Motorcycles are a symbol of Comfort, Passion and Economy in sense of fuel efficiency.  It was found that Hero Honda is the most preferred bike followed by Bajaj & TVS.  The survey proved that all the bikes of Hero Honda are equally liked by Public. But certainly, Splendor & Victor GL being the oldest model is still preferred more by people.  The survey also proved that Hero Honda has been able to retain quality while launching new stylish bikes in face of competition.  Splendor and Passion are unbeatable models of Hero Honda.  Like wise Victor GL and TVS SCOOTY are unbeatable models of TVS.  People appreciated the movement of Hero Honda in providing a new image to Splendor and Passion by coming up with Splendor Plus and Passion Plus.  Like Wise Victor GL coming up with Victor GLX.  It was also found that consumer views Hero Honda as a bike which gives value for money. This means over the years, Hero Honda has been able to retain its Goodwill in customer’s eyes.  Hero Honda is still the Leader in Bike Industry in India.  Lastly, it was found that most no. of people carries a positive attitude towards Hero Honda. Many of them are certain that they will buy Hero Honda Bike in future. 36 AboveAGE GROUP 18-20 9% 10%

21-25 33%

31-35 37% 26-30 11%

INCOME GROUP (PER ANNUM IN THOUSAND)

150-175 11%

175 above 4%

75-100 17%

125-150 11%

100-125 57%

Three Motorcycle Companies that comes in your mind? 35 32

30

25 20 20

18 17

15

10 4 5

0 TVSL

HHML

BAL

EYML

RE

Things that you looked while purchasing a bike?

80

75 71 68

69

70

60

50

40

33

32

30

20

10

0 Fuel efficiency

Looks

Low Reliability maintenance (less chances cost of breakdown)

Least physical effects

Low price

How did you get to know about Hero Honda that you are having at present? 80

75 72

71

70

60

51 50

40

31 26

30

20

10

0 Looks

Fuel economy

Low maintance cost

Reliability

Least physical effort bike

High price

Which other bikes would you prefer to buy?

45

40

35

30

25

20

15

10

5

0 Yamaha

LML

TVS

Bajaj

I preferred Hero Honda Splendor than other bike?

80

71 66

70

60

50

40

33

30

14

20

10

0 Maintenance cost

Looks

Physical efforts

Fuel economy

CHAPTER-IV MACRO ANALYSIS

MACRO ANALYSIS From the customers survey and desk research we conclude that:



Most of the customers of Hero Honda belong to congested areas. They mostly belong to middle class and are mostly officials/ executives. Thus, we conclude client has targeted the right segment.



From the findings we conclude that a customers while purchasing a bike, customers takes into consideration mainly fuel efficiency, good looks, low maintenance cost and reliability.



The main competitors of Hero Honda are Bajaj Auto, Yamaha, TVS, and Suzuki.

 

The consumer preference basically depends upon wider network and better services. In addition to continuous innovation to improve the performance, features and durability of our two-wheelers, we also benchmark the sales of the products and service processes to offer better value to the customer. Customer service is provided through a large network of fully equipped dealers, authorized and certified service points. The service network is equipped with state of the art workshops, hydraulic and pneumatic equipment, carbon emission devices, etc. A network of authorized spare parts stockiest has also been set-up to ensure timely supplies. We commission customer satisfaction surveys through specialist agencies on a continuous basis to monitor the feedback, which is benchmarked to improve product performance and satisfaction. The company was ranked second in overall customer satisfaction and TVS Centra emerged as the top choice in the executive segment. Since dealers are the first customers, a comprehensive dealer management system (DMS) is being introduced to improve dealership sales and services processes. Regular meetings of select groups of dealers, designated as 'presidents club' and 'antenna club', are conducted to obtain feedback on customer's expectations and solve customer problems. Customers are influenced more to buy a product by advertisements rather than dealer friend’s or family recommendations.







CHAPTER-V OBSERVATION & RECOMENDATIONS

OBSERVATIONS After a study of various Hero Honda & TVS customers, we found the following:

♦ Geographical Distribution: About 98% of the customers surveyed belong to congested areas of Delhi.

♦ Age group of customers: About 90% of the customers were within in the age group of 20-35

♦ Income group of customers: Most of the customers surveyed belong to middle income group.

♦ Occupation of the customers: 84% of the customers surveyed were official/ salesmen and 11% were students & first jobbers.

♦ Percentage share of HHML and TVSL in two wheeler segment: HHML holds 43% share. TVSL holds 21% share.

♦ Customers preferences while purchasing a bike: Fuel efficiency, looks, Low maintenance cost, Reliability

♦ Competitors of Hero Honda: According to the survey reports the main rivals of Hero Honda are TVS Suzuki, Yamaha, Bajaj Auto.

♦ Preference of Hero Honda over competitors: About 89% of the customers believe that Hero Honda is better than the competitors because of low maintenance cost and fuel efficiency.

RECOMMENDATIONS After the complete analysis of entire assignment we put forward a set of recommendations which are a follows:  Since the client has targeted the right segments, but the reason for the low sales of Hero Honda is its dependability on Honda design.  CBZ is high price. Moreover the client has positioned the bike as “city ride made easy”. Low fuel –efficient bike as a result of which results in small segment of customers.  HHML is overlooking one feature in bike. Which is its low maintenance, and reliability (i.e. less chances of breakdown) which are absent in its competitors. Therefore in order to meet the sales target, two options are available with the client, one is to redesign the bike and second is to reposition the bike as “bike with one time investment” since redesigning of bike may involve a big task and huge investment therefore we recommended repositioning the bike.  In order to increase the market share, customer’s promotional activities should be encouraged through advertisements to attract the male & female segment.  Hero Honda, if it starts functioning independently, has to innovate and develop their own technology to support their growth aspirations.  The dissatisfied customers should be dealt with appropriately should be satisfied so that they do not break the relationship with company.  Service class segment has the huge potential for fuel efficient bikes with low maintenance with some looks.  Marketing strategy is the crucial part of the brand image building in the customer mind which can be easily understood by the success of Bajaj Pulsar in the current market.

ANNEXURE (i)

QUESTIONNAIRE

(ii)

RAW ANALYSIS

(iii)

BIBLIOGRAPHY

QUESTIONNAIRE

CONSUMER SURVEY Name: ______________________ Address: _____________________

Q1. Please mention your age group 18-20

 21-25

 26-30

 31-35

 36- Above Q2.) Please mention your income group (per annum in thousand)  75-100

100-125

 125-150

150-175

 175 & above Q3) Gender  Male

 Female

Q4) Martial Status  Married

 Unmarried

Q5) Please mention your occupation.  Officials

 Clerical or Salesmen

 Student

 First Jobbers Retired

Q6) Name three motorcycle companies that come to your mind  Hero Honda Motor Ltd.  TVS Ltd.  Escort Yamaha Motors Ltd.  Royal Enfield  Bajaj Auto Ltd. Q7) what are the things that you look while purchasing a bike?  Fuel efficiency  Looks  Low maintenance cost  Reliability(less chances of breakdown)  Least physical efforts Low price Q8) How did you get to know about Hero Honda that you having at present?  Advertisement  Family information  Friend’s recommendation  Dealer’s recommendation Q9) how did you get to know about Hero Honda that you having at present?  Advertisement  Family information

 Dealer’s recommendation  Friend’s recommendation

Q10) Which other bike would bike you have preferred to buy?  Yamaha

 LML

 TVS Motors

 Hero Honda

 Bajaj Pulsar

Q11) Prefer Hero Honda splendor than other bike because of:  Fuel economy

 less physical efforts

 Better looks

 Low maintenance cost

Q12) Would prefer TVS Victor to Hero Honda Splendor because of:  Fuel economy

 Price

 Brand image

 Low maintenance cost

Q13) What is the image of HERO HONDA in your mind?  Economical  Durable  Smooth Bike  Safe Bike  Rough and Tough Q14) what is the image of TVS Motors in your mind?  Economical  Durable  Smooth Bike  Safe Bike  Rough and Tough

RAW ANALYSIS

To make the study meaningful the data collected needs to be edited, encoded and tabulated. This is necessary to arrive at a concrete conclusion. The raw data has no use in research until an appropriate analytical tool is used. This is essential for the study for ensuring that we have all relevant data for making contemplated comparisons and analysis. The various data obtained through the methods specified in the preceding sections have been carefully sections have been carefully edited and classified for further use in presenting the data in an easily understandable manner. Among the tools available for better analysis data tools such as pie charts, bar graphs were used.

BIBLIOGRAPHY MAGAZINES  AME BUSINESS MAGAZINE.  AUTO MAGAZINE.  BUSINESS INDIA  FINANCIAL EXPRESS  BUSINESS LINE  OVER DRIVE MAGAZINE.

WEBSITES  WWW. INDIAINFOLINE.COM  WWW. HEROHONDA.COM  WWW.TVSMOTOR.COM  WWW.ECONOMICTIMES.COM 

WWW.GOOGLE.COM