Sales Promotion On Maruti Suzuki.docx

“PROMOTIONAL STRATEGY OF MARUTI SUZUKI”

Submitted by: Chirag Agarwal Class: BBA 6A Marketing Management Name of the Mentor – Dr. Debasis Ray ILEAD (Affiliated To WBUT)

ACKNOWLEDGEMENT Any fruitful work is incomplete without a word of thanks to those involved directly or indirectly in its completion. With my sincere gratitude I would like to thanks everyone who has supported me in my project. I would like to thank Prof. (Dr.) Debasis Ray to provide us with opportunity to work and expand our knowledge. The help received from something without which the project would not have been complete. Their insight as well as guidance helped me to understand the essentials of the Project. I would like to thank them for their support. I would also like to place on record my sense of gratitude to my parents and friends for their support and encouragement, which has always guided me my entire endeavored.

TO WHOM IT MAY CONCERN

This is to certify that Chirag Agarwal, a student of BBA (Hons.), 3rd Year, of ILEAD has successfully completed the project on “A study on the Marketing and Promotional Strategy of Maruti Suzuki” under the supervision and guidance of Dr. Debasis Ray. The project being submitted is genuine and original work to the best of my knowledge.

_____________________ Dr. Debasis Ray Ilead Kolkata

PREFACE

Promotion is one of the four aspects of promotional mix. (The other three parts of the promotional mix are advertising, personal selling, and publicity/public relations.) Media and non-media marketing communication are employed for a pre-determined, limited time to increase consumer demand, stimulate market demand or improve product availability Many of the examples above are focused upon consumers. Don't forget that promotions can be aimed at wholesalers and distributors as well. These are known as Promotions. Examples here might include joint promotions between a manufacturer and a distributor, sales promotion leaflets and other materials (such as car), and incentives for distributor sales people and their retail clients.

TABLE OF CONTENT SL NO.

TOPIC

1.

ACKNOWLEDGEMENT

2.

CERTIFICATE

3.

PREFACE

4.

INTRODUCTION & PROMOTION KEY CONCEPTS

5.

SALES PROMOTION

6.

PROMOTION TECHNIQUES

7.

POLITICAL ISSUES & PROMOTIONAL MIX

8.

COMPANY PROFILE, HISTORY AND CHRONOLOGY OF MARUTI SUZUKI

9.

PRODUCTS & SERVICES AND SWOT ANALYSIS

10.

SALES & SERVICE NETWORK, PROMOTION AND CRM ACTIVITIES, AFTER SALES SERVICE

11.

CONCLUSION

12.

BIBLIOGRAPHY

INTRODUCTION Sales promotion is any initiative undertaken by an organization to promote an increase in sales, usage or trial of a product or service (i.e. initiatives that are not covered by the other elements of the marketing communications or promotions mix). Sales promotions are varied. Often they are original and creative, and hence a comprehensive list of all available techniques is virtually impossible (since original sales promotions are launched daily!). Here are some examples of popular sales promotions activities: (a) Customer Relationship Management (CRM) incentives such as bonus points or money off coupons. There are many examples of CRM, from banks to supermarkets. (b) New media - Websites and mobile phones that support a sales promotion. For example, in the United Kingdom, Nestle printed individual codes on KIT-KAT packaging, whereby a consumer would enter the code into a dynamic website to see if they had won a prize. Consumers could also text codes via their mobile phones to the same effect.

(c) Merchandising additions such as dump bins, point-of-sale materials and product demonstrations. (d) Free gifts e.g. Subway gave away a card with six spaces for stickers with each sandwich purchase. Once the card was full the consumer was given a free sandwich. (e) Discounted prices e.g. Budget airline such as EasyJet and Ryanair, e-mail their customers with the latest low-price deals once new flights are released, or additional destinations are announced. (f) Free samples (aka. sampling) e.g. tasting of food and drink at sampling points in supermarkets. For example Red Bull (a caffeinated fizzy drink) was given away to potential consumers at 1supermarkets, in high streets and at petrol stations (by a promotions team). (g) Competitions and prize draws, in newspapers, magazines, on the TV and radio, on The Internet, and on packs. (h) Cause-related and fair-trade products that raise money for charities, and the less well-off farmers and producers, are becoming more popular.

(i) Finance deals - for example, 0% finance over 3 years on selected vehicles. Many of the examples above are focused upon consumers. Don't forget that promotions can be aimed at wholesalers and distributors as well. These are known as Trade Sales Promotions. Examples here might include joint promotions between a manufacturer and a distributor, sales promotion leaflets and other materials (such as car), and incentives for distributor sales people and their retail clients.

PROMOTION Key concepts Product / Pricing / Promotion Distribution / Service / Retail Brand management Account-based marketing Marketing ethics Marketing effectiveness Market segmentation Marketing management Market dominance Promotional content Advertising / Branding Direct marketing / Personal Sales Product placement / Public relations Publicity / Sales promotion Promotional media Printing / Publication / Broadcasting Out-of-home / Internet marketing Word of mouth

Sales promotion is one of the four aspects of promotional mix. (The other three parts of the promotional mix are advertising, personal selling, and publicity/public relations.) Media and non-media marketing communication are employed for a pre-determined, limited time to increase consumer demand, stimulate market demand or improve product availability. Examples include: 

contests



point of purchase displays



rebates



free travel, such as free flights

Sales promotions can be directed at either the customer, sales staff, or distribution channel members (such as retailers). Sales promotions targeted at the consumer are called consumer sales promotions. Sales promotions targeted at retailers and wholesale are called trade sales promotions. Some sale promotions, particularly ones with unusual methods, are considered gimmick by many.

Consumer sales promotion techniques 

Price deal: A temporary reduction in the price, such as happy hour



Loyal Reward Program: Consumers collect points, miles, or credits for purchases and redeem them for rewards. Two famous examples are Pepsi Stuff and Advantage.



Cents-off deal: Offers a brand at a lower price. Price reduction may be a percentage marked on the package.



Price-pack deal: The packaging offers a consumer a certain percentage more of the product for the same price (for example, 25 percent extra).



Coupons: coupons have become a standard mechanism for sales promotions.



On-shelf couponing: Coupons are present at the shelf where the product is available.



On-line couponing: Coupons are available on line. Consumers print them out and take them to the store.



Online interactive promotion game: Consumers play an interactive game associated with the promoted product. See an example of the Interactive Internet Ad for tomato ketchup.



Rebates: Consumers are offered money back if the receipt and barcode are mailed to the producer.



Contests/sweepstakes/games: The consumer is automatically entered into the event by purchasing the product.

Trade sales promotion techniques 

Trade allowances: short term incentive offered to induce a retailer to stock up on a product.



Dealer loader: An incentive given to induce a retailer to purchase and display a product.



Trade contest: A contest to reward retailers that sell the most product.



Point-of-purchase displays: Extra sales tools given to retailers to boost sales.



Training programs: dealer employees are trained in selling the product.



Push money: also known as "spiffs". An extra commission paid to retail employees to push products.

Trade discounts (also called functional discounts): These are payments to distribution channel members for performing some function.

POLITICAL ISSUES Sales promotions have traditionally been heavily regulated in many advanced industrial nations, with the notable exception of the United States. For example, the United Kingdom formerly operated under a resale price maintenance regime in which manufacturers could legally dictate the minimum resale price for virtually all goods; this practice was abolished in 1964. PROMOTIONAL MIX There are four main aspects of a promotional mix. These are: 1 Advertising- Any paid presentation and promotion of ideas, goods, or services by an identified sponsor. Examples: Print ads, radio, television, billboard, direct mail, brochures and catalogs, signs, instore displays, posters, motion pictures, Web pages, banner ads, and emails. 2 Personal Selling - A process of helping and persuading one or more prospects to purchase a good or service or to act on any idea through the use of an oral presentation. Examples: Sales presentations,

sales meetings, sales training and incentive programs for intermediary salespeople, samples, and telemarketing. 3 Promotions- Incentives designed to stimulate the purchase or sale of a product, usually in the short term. Examples: Coupons, sweepstakes, contests, product samples, rebates, tie-ins, self-liquidating premiums, trade shows, trade-ins, and exhibitions. 4 Public relations - Paid intimate stimulation of supply for a product, service, or business unit by planting significant news about it or a favorable presentation of it in the media. Examples: Newspaper and magazine articles/reports, TVs and radio presentations, charitable contributions, speeches, issue advertising, and seminars. Direct Marketing is often listed as a the fifth part of the marketing mix Sponsorship is sometimes added as a sixth aspect.

COMPANY PROFILE Maruti Suzuki

Type Traded as

Public

  

BSE: 532500 NSE: MARUTI BSE SENSEX Constituent

Industry

Automotive

Founded

1981; 38 years ago

Headquarters

New Delhi, India

Area served

India

Key people

 

Products

R. C. Bhargava (Chairman) Kenichi Ayukawa (Managing Director & CEO) Automobiles

Production output

1,568,603 units (2017)

Revenue

₹796,060 million(US$11 billion) (2017)

Operating income

₹101,272 million(US$1.4 billion) (2017)

Net income

₹77,326 million(US$1.1 billion) (2017)

Total assets

₹519,605 million(US$7.2 billion) (2017)

Total equity

₹370,905 million(US$5.2 billion) (2017)

Number of employees Parent Website

40000 (2018)

 

Suzuki Motor Corporation (56.21%) Public (43.79%) www.marutisuzuki.com

Maruti Suzuki India Limited, formerly known as Maruti Udyog Limited, is an automobile manufacturer in India. It is a 56.21% owned subsidiary of the Japanese car and motorcycle manufacturer Suzuki Motor Corporation. As of July 2018, it had a market share of 53% of the Indian passenger car market. Maruti Suzuki manufactures and sells popular cars such as the Ciaz, Ertiga, Wagon R, Alto

K10, Swift, Celerio, Swift

Dzire, Baleno

and

Baleno

RS, Omni, Alto

800, Eeco, Ignis, S-Cross. The

company

is

headquartered at New Delhi. In May 2015, the company produced its fifteen millionth vehicle in India, a Swift Dzire.

History Maruti was established in February 1981 with production starting in 1983 with the Maruti 700 Which is 100 % Indian Made & The Second Model is Maruti 800 DX based on the Suzuki SS80 Which is imported From Japan Car Manufacturer SUZUKI As of May 2007, the Government of India, through Ministry of Disinvestment, sold its complete share to Indian financial institutions and no longer has any stake in Maruti Udyog. Chronology Under the name Maruti "Surya Ram Maruti Technical Services Private Ltd" (MTSPL), a private company, was launched in 1970 to provide technical know-how for the design, manufacture and assembly of "a wholly indigenous motor car". Under the Companies Act, "Maruti Limited" was incorporated in June 1971. Maruti Limited went into liquidation in 1977. Further, Maruti Udyog Ltd was incorporated through the efforts of Dr. V Krishnamurthy.

Affiliation with Suzuki In 1982, a license and joint venture agreement (JVA) was signed between Maruti Udyog Ltd, and Suzuki of Japan. At first, Maruti Suzuki was mainly an importer of cars. In India's closed market, Maruti received the right to import 40,000 fully built-up Suzuki in the first two years, and even after that the early goal was to use only 33% indigenous parts. This upset the local manufacturers considerably. There were also some concerns that the Indian market was too small to absorb the comparatively large production planned by Maruti Suzuki, with the government even considering adjusting the petrol tax and lowering the excise duty in order to boost sales. At First Maruti introduced Maruti 700 which is Indian Made Later Maruti Tied Up with Japan Car Manufacturer SUZUKI & Imported SUZUKI SS80 & Sold In Indian market With the Name MARUTI SUZUKI 800DX in 1983, this Maruti 800 Its India's first Hatchback car. In 1985, the Suzuki SJ410-based Gypsy, a 970 cc 4WD off-road vehicle, was launched. In 1986, the original 800 was replaced by an all-new model of the 796 cc hatchback Suzuki Alto and the 100,000th vehicle was produced by the company. In 1987, the company started exporting to the West, when a lot of 500 cars were sent to Hungary. By 1988, the capacity of the Gurgaon plant was increased to 100,000 units per annum.

Products and services Current models Model

Launched

Category

Omni

1984–present

Minivan

WagonR

1999–present Hatchback

Swift

2005–present Hatchback

DZire

2008–present

Sedan

Image

Eeco

2009–present

Minivan

Alto 800

2014-present

Hatchback

Alto K10

2010–present Hatchback

Ertiga

2012–present

Mini MPV

Alto 800

2012–present Hatchback

Celerio

2014–present Hatchback

Ciaz

2014–present

Sedan

Baleno

2015–present Hatchback

S-Cross

2015–present

Mini SUV

Vitara Brezza 2016–present

Mini SUV

Ignis

CelerioX

2017–2019

Hatchback

2017–present Hatchback

Discontinued models

Model

Launched Discontinued

Category

800

1983

2010

Hatchback

Gypsy E

1985

2000

Mini SUV

1000

1990

2000

Sedan

Zen

1993

2003

Hatchback

Image

Esteem

1994

2010

Sedan

Baleno

1999

2007

Sedan

Alto

2000

2012

Hatchback

Versa

2001

2010

Minivan

Grand Vitara XL7 2003

2007

Mini SUV

Grand Vitara

2007

2015

Mini SUV

Zen Estilo

2007

2013

Hatchback

A-star

2008

2014

Hatchback

SX4

2008

2014

Sedan

Swift Dzire

2008

2017

Sedan

Ritz

2008

2016

Hatchback

Kizashi

2011

2014

Sedan

Gypsy King

1985

2018

Mini SUV

Sales and Service Network Maruti Suzuki has 1,820 sales outlets across 1,471 cities in India. The company aims to double its sales network to 4,000 outlets by 2020. It has 3,145 service stations across 1,506 cities throughout India. Maruti's dealership network is larger than that of Hyundai, Mahindra, Honda, Tata, Toyota and Ford combined. Service is a major revenue generator of the company. Most of the service stations are managed on franchise basis, where Maruti Suzuki trains the local staff. Other automobile companies have not been able to match this benchmark set by Maruti Suzuki. The Express Service stations help many stranded vehicles on the highways by sending across their repair man to the vehicle. NEXA In 2015 Maruti Suzuki launched NEXA, a new dealership format for its premium cars. Maruti currently sells the Baleno, Baleno RS, S-Cross, Ciaz and Ignis through NEXA outlets. S-Cross was the first car to be sold through NEXA outlets. Several new models will be added to both channels as part of the Company's medium term goal of 2 million annual sales by 2020.

Awards and recognition The Brand Trust Report published by Trust Research Advisory, a brand analytics company, has ranked Maruti Suzuki in the thirty seventh position in 2013 and eleventh position in 2014 among the most trusted brands of India. Viewers' Choice Car of the Year published by CNBC-TV18 OVERDRIVE, Overdrive is India’s No.1 Auto Publication for Cars and Bikes in India, has awarded Maruti Suzuki Baleno the Viewers' Choice Car of the Year 2016

Market Share • THE LATEST STATISTICS SAY THAT MARUTI SUZUKI INDIA PVT LTD. HAS A WHOOPING 35% IN THE PASSENGER CAR SEGMENT. • THE MARKET SHARE OF MARUTI IS INCREASING AS THE OVERALL INDUSTRY IS SUFFERING FROM THE BAD ECONOMIC CONDITIONS. • THE ENTRY LEVEL SMALL CAR ALTO IS THE BEST SELLING CAR IN ALL SEGMENTS SINCE LAST SEVEREL YEARS AND SELLS AROUND 18000 UNITS EVERY MONTH. • THE SECOND, THIRD AND THE FOURTH HIGHEST SELLING CARS ARE WAGONR, SWIFT AND DEZIRE. ALL THESE ARE PRODUCTS OF MARUTI INDIA PVT LTD. • THE COMPANY SELLS ABOUT A MILLION UNITS PER ANNUM.

SALES AND SERVICE NETWORK • MARUTI INDIA UNDOUBTEDLY HAS THE BEST SALES AND SERVICE NETWORK IN THE INDUSTRY. • IT HAS 802 SALES OUTLETS IN 555 CITIES AND 2740

SERVICE WORKSHOPS IN 1335 CITIES. THE SERVICE NETWORK OF THE MARUTI SUZUKI INCLUDES DEALER WORKSHOPS, AUTHORIZED SERVICE STATIONS AND MARUTI SERVICE ZONES WHICH SUMS UP TO 3013. • Over 33000 personnel are engaged in the service centers of the company. • The company is all set to double the sales network by the end of 2015.

Sales Promotion and CRM Activities 1. CONSUMER PROMOTION ACTIVITIES • Price Packs. • Price packs are the general offers to customers of savings off the regular price of the products. Maruti, in spite of achieving magical figures every year consistently offer price packs. GIFT CHEQUES AND EXCHANGE BONUSES ARE ALWAYS OFFERED ON EVERY MARUTI CAR ALL ROUND THE YEAR.

• Premiums and Gifts. Maruti Suzuki offers accessories like alloy wheels, body cover, carpets, door visors, fog lamps, stereo systems, seat covers and other car care products as gifts with the higher end product

• FREQUENCY PROGRAMS. Frequency programs are to reward the loyal customers of the company. Maruti has a loyalty discount in which the company offers 2-3% discount on the product if the buyer is already an owner of a Maruti car. A special corporate discount is offered to employees of certain companies on the cars.

 FREE TEST DRIVES. The test drives are free of cost and is the best way of demonstrating a product where the potential buyer himself drives the vehicle and decides whether or not to buy the car. The company provides a test drive on a telephone request at the buyer’s home. So the buyers don’t even have to go to the sales outlet for the drive but the company guys come to the buyers place.

 PRODUCT WARRANTIES. The warranties of the products are as high as up to 40,000 km. This considerably reduces the cost of owning a Maruti making it the perfect car for the middle class masses which is the target market of most of the cars of the company.

• POINT OF PURCHASE DISPLAYS. Displays and demonstrations are of the most importance for the company. The company is bothered about this particular parameter to such an extent that the dealerships are given only after the minimum space requirements and the location requirements are fulfilled by the applicants.

2. TRADE PROMOTION ACTIVITIES. Price off • Price off is a straight discount off the list price or the landing price offered to the retailers. • Maruti offers a discount on achieving certain targets to its dealers. The exact information on this is with the dealers and the company but the TODs are definitely offered

3. BUSINESS AND SALES FORCE PROMOTION ACTIVITIES • AUTO SHOWS. Maruti is a consistent participator in the world famous auto shows like AUTOEXPO and Geneva motor show. Most of its products and new launches are mainly in these mega events in and out of India alike. • SALES CONTEST • Sales contest aims at inducing the dealers to increase their sales over a stated period, with prizes going to those who succeed. • THE DEALER OF THE YEAR AWARD is given by Maruti depending on the sales and service done the dealers. Other prizes like cash discounts and foreign trips are common in the company dealers.

Major Sponsorships • The first sponsor of the advertiser funded film MERE DAD KI MARUTI. • Sponsors many road safety award for students and policemen. • MARUTI ALSO SPONSORED THE ONLINE CRICKET LEAGUE NAMED MARUTI SUZUKI INDIA LEAGUE WHICH GENERATED 3.20 LAKH CLICKS. • Sponsored the 6TH INDIAN PREMIER LEAGUE and reached 7 million audience

CRM ACTIVITIES MARUTI DRIVING SCHOOL. Today there are over 300 MDSs nationwide, and the company has already created 5 lakh better, more confident drivers.

AT HOME TEST DRIVE The customer just has to give a call to the dealer and the dealer will arrange for a test drive from your home. ME AND MY MARUTI This is a program where the company gives free tips to the owners of their cars about the day to day driving, maintenance and troubleshooting in case something goes wrong with the car. THE EXPERIENCE AT THE DEALERSHIP The company sees to it that the customer is treated properly and due attention is given to their queries. They also offer advisory service in case a customer is not very Sure about which car to buy. It is a good experience to buy at Maruti showrooms.

After Sales Service • Maruti has backed the BEST SERVICE PROVIDER AWARD the 14th time this year. And it is not very surprising. • With this tremendous penetration into the country and over 3000 service stations, it is undoubtedly the best service provider with a daily servicing of more than 40000 cars. • Maruti has the MOST COST EFFECTIVE genuine spare parts available at all the service stations and also special spare part authorized dealers. So finding a spare part of a Maruti car is not a trouble at all. With AFTER SALES SERVICE being one of the major concerns of the middle class people, Maruti earns great points and the effect is seen in its sales.

Conclusion

Maruti Suzuki India Pvt Ltd. is the biggest manufacturer of passenger cars and holds a market share of over 35% in the Indian market and an average export of 1lakh units per annum. This consistent success and sust0ainability is achieved by its fool-proof sales strategy, which not only involves customers but also the dealers of the company. The CRM of the company also is commendable and undoubtedly adds to the growth of the company.

Bibliography

1. https://www.marketing91.com/marketing-strategy-of-maruti-suzuki/ 2. https://en.wikipedia.org/wiki/Maruti_Suzuki

3. https://www.mbaskool.com/marketing-mix/products/16974-maruti-suzuki.html 4. http://www.icmrindia.org/casestudies/catalogue/Marketing/MKTG230.htm

5. https://www.google.com/search?q=maruti+suzuki+promotion+strategy&source=lnms&tbm=isch&sa=X&ve d=0ahUKEwiP_8yFtKLhAhUVU30KHdVtAUIQ_AUIDygC&biw=1536&bih=722