Maruti Auto Expo’08Maruti Auto Expo’08

IntroductionIntroduction

Maruti Suzuki India ltd. Maruti is India's largest passenger car company, which account for over 50 per cent of the

domestic car market.

Maruti have a sales network of 562 outlets in 372 towns and cities, and provide maintenance support to customers at 2538 workshops in over 1200 towns and cities (as on December 31,2007).

The company boasts about its products, which offer unsurpassed fuel efficiency, low maintenance costs and easy availability of genuine parts.

MUL extended its product range to include vans, multi-utility vehicles (MUVs) and mid-sized cars.

Suzuki saw its Indian sales rise 21 per cent to 653,000 cars

Of the $3.5 billion Suzuki plans to spend on its expansion in India

MUL’s Competitive Advantage

Size Low Initial investment Unique concessions from the government Indigenous sourcing of components Fully depreciated plants High labour productivity

Maruti Suzuki ranks highest in customer satisfaction with authorized dealership service

Maruti models

Comparing Maruti 800 and Tata Nano

Maruti Suzuki India Limited has showcased three

concept cars at the Auto Expo 2008

• Concept A-Star,

• Concept Splash and

• Concept Kizashi

Concept A-Star

It is a concept car because it is for the first time that Suzuki has premiered a concept in India.

It is the first Japanese-Indian concept vehicle.

Segment: A (currently Alto is the market leader in this segment.

Expected price: A-star is expected to be priced around the 3-4 lakh range($7500)

Competitors: Chevrolet Spark and

the Hyundai i10.

Segmentation,Targeting and Positioning

SegmentationDEMOGRAPHIC:

A) Age- 20-34

B) Gender- Male, Female

C) Family size- 3-4 , 4+

D) Income - RS 20000-30000, 30000-50000, 50000 and above.

E) Occupation- Professionals, Officials, Supervisors, Home makers, Youngsters.PSYCHOGRAPHIC

A) Social class: Middle class, working class, upper lowers.

B) Lifestyle: Strivers, Achievers

C) Personality: Gregarious, Ambitious, Compulsive

BEHAVIORAL:

A) Benefits: Quality. Service, Economy, Speed

B) Readiness stage: Interested, Intending to buy

Cont……...Cont……...

TARGET MARKET: Expected price: A-star is expected to be priced around the 3-4lakh range

It will target the small car segment A segment where ALTO is the market leader. It will mainly focus on the middle and workers class people. It will satisfy both the needs of European and Indian customers.

POSITIOINING: The A-Star would be launched in other international markets gradually.

The A-Star is an environmentally oriented concept and would be produced with a very efficient 1-litre petrol engine, which would have great mileage and low emissions.

The A-Star might just be the new Alto in India.

Porter’s Five Force Model

Potential entrants

Will impart a spectacular growth to the entire industry by actually widening and deepening it.

It is doubtful if the current growth rate of over 50 per cent would have been possible but for the entry of these players.

New entrants into this segment could be Honda with its sub-compact Jazz, or Honda Life as it is called in other markets

Ford India with either the Fusion or the Fiesta

Rivalry amongst the existing firms

And from a second-hand car to cars like the Maruti Zen, Hyundai Santro, Daewoo Matiz or the Tata Indica.

Throw in a few more lakhs and you can bite into the wider small segment populated by the Hyundai Santro, Maruti Zen, Maruti WagonR, Tata Indica, and Fiat Palio.

The deluxe version of the Zen, the fully-loaded Santro and the Matiz form another segment along with the Fiat Uno.

Cont…….

Substitutes Maruti swift sedan, Maruti splash, Tata 1 lakh car a small family car actually a substitute for a Maruti A-

star.

The Indica and the Santro due to its high presence in the market can be substitute for A-star

Due to lower price consumer can shift to motorbikes and scooters launched by TVS, Bajaj and Yamaha.

Bargaining power of suppliers The cars of Maruti are differentiated to such an extent that it is difficult for buyers to switch over to other

products.

As Maruti is dominant player in the market holding 50% share in the industry, it is highly attractive to buyers.

Branding- The brand Maruti is strong due to its role of quality and services

Switching Costs- It’s easy for suppliers to locate new customers.

Cont…….Cont…….

Bargaining power of buyers

Usually customers appreciate and look for various features in a car. Often there is a loyal set of customers. Cars enhance social status and there may be a strong association of price with quality and status.

Switching costs- It’s easy for buyers to locate new suppliers

Large number of options available

Well informed customers

Availability of finance schemes

Concept SplashConcept Splash

Segment: B (Next generation Wagon R) Expected price: Rs 4.5-5.5 lacs Theme: ‘Family’ The name Splash signifies its desire to

create a new sensation. Splash combines the sportiness of

Suzuki's successful model Swift with the technologies and immense know-how

Suzuki unveiled its’ splash’ MPV (Multi Purpose Vehicle) in the Frankfurt Motor Show.

Segmentation, Targeting and PositioningSegmentation, Targeting and Positioning

SEGMENTATION

DEMOGRAPHIC:

A) Age- 20-40

B) Gender- Male, Female C) Family size- 4-5 , 5 D) Income - RS 25000-35000, 35000-50000, 50000 and above. E) Occupation- Professionals, Officials, Managers, Sales, Youngsters.

PSYCHOGRAPHIC: A) Social class: Middle class, Upper middle class B) Lifestyle: Achievers, survivors C) Personality: Gregarious, Ambitious

BEHAVIORAL:

A) Benefits: Quality. Service, Economy, Speed

B) Readiness stage: Interested, Intending to buy

Cont…….Cont…….

TARGET MARKET: It will target the B-segment

The theme of the splash is basically focusing on FAMILY It signifies its desires to create a new sensation. Its vivid sound creates a sense of freshness

and youthfulness. It will likely appeal to those with small families and low budget.

POSITIONING: The Japanese major chose the name Splash for the car to “signify its desire to create a new

sensation.

Maruti Suzuki's Splash is orientated strongly towards the European design style. Splash will be marketed for its such high seating position, good visibility and spacious interiors.

Suzuki's Splash will offer comfortable space for five occupants due to clever packaging

Porter’s Five Force Model

POTENTIAL ENTRANTS: It is doubtful if the current growth rate of over 50 per cent would have been possible but for the entry of these

players.

CHEVROLET AVIO (AVEO-5) – mp3 enabled audio system, carbon fiber trim, solid fuel economic ratings.

TOYOTA’S youth oriented spin off: SCION XD- subcompact interior, fuel economy 30mpg, transportation costing <$16000.

VOLKS WAGEN: POLO-diesel push, sharper price $16990, face lift.

RIVALRY AMONG EXISITING FIRMS:

And from a second-hand car to cars like the Maruti800, Maruti zen, Hyundai santro, Maruti esteem, Maruri alto etc..

TATA’S low cost car will create a new segment as no cars available in 1lakhs-2lakhs segment.

HYUNDAI latest small car-pressure on pricing.

SATURN AURA XB-bidding for mid-size segment.

Cont…..Cont…..

BARGAINING POWER OF SUPPLIERS:

The cars of Maruti are differentiated to such an extent that it is difficult for buyers to switch over to other products.

As Maruti is dominant player in the market holding 50% share in the industry, it is highly attractive to buyers.

Branding- The brand Maruti is strong due to its role of quality and services Switching Costs- It’s easy for suppliers to locate new customers.

SUBSTITUTES:

Maruti SWIFT SEDAN, Maruti A-STAR, TATA 1 lakh car a small family car actually a substitute for a Maruti SPLASH..

Maruti WAGON-R, CHEVROLET AVEO, HYUNDAI i10.

PEOPLE can switch over to new bikes launched by Yamaha-R1, BAJAJ, TVS.

PEOLE can go for Diesel or Cng cars due to high prices of petrol and fuel efficiency eg. SWIFT SEDAN

Cont……….Cont……….

BARGAINING POWERS OF BUYERS: SWITCHING COST- buyers looking for new suppliers.

Consumer going for second hand car market.

Availability of :

a) Finance scheme

b) Registration insurance

Different substitutes available.

Concept KizashiConcept Kizashi

Competitor: Honda’s civic Segment : D Theme: “Status”. With Concept Kizashi, Suzuki

Motor Corporation has announced its entry into the D-segment.

Segmentation, Targeting and Positioning

SEGMENTATION

DEMOGRAPHIC:

A) Age- 20-34

B) Gender- Male, Female

C) Family size- 3-4 , 4+

D) Income - RS 50000-75000, 75000-100000, 100000-125000, 125000-150000 and over.

E) Occupation- Professionals, officials, Youngsters.

PSYCHOGRAPHIC:

A) Social class: Upper middle class, High class

B) Lifestyle: Achievers

C) Personality: Gregarious, Ambitious

BEHAVIORAL:

A) Benefits: Quality. Service, Economy, Speed

B) Readiness stage: Interested, Intending to buy

Cont…….Cont…….

TARGET MARKET:

KIZASHI revealed in Frankfurt represents the beginning of the 3 rd phase of world strategy.

It is into a Luxury car segment. It will mainly target the high class people with its sporty looks and comfort,

Its main objective will focus on status. It will target an un-compromised combination of affordability and emotional appeal

POSITIONING:

The sportiness that Suzuki wants to deliver in the D-segment will perhaps be most directly expressed by the car's dynamics.

The design of the new car should have two themes: grace and dynamism.

Kizashi represents Suzuki's passion for challenges (this is a major aspect of Suzuki's corporate culture), its future direction, and the competitive strengths that are unique to Suzuki.

Porter’s Five Force Model

POTENTIAL ENTRANTS:

BMW-1-series

Octavia Skoda Skoda Fabia- engines offered in 4 trims levels- active, classic, ambiente and elegance. Audi Honda Accord-LX – 16inch alloy wheel, 166-hp, 2.4-4lt cylinder engine. Chevrolet Captiva- sporty design, luxury features, seating, ride control.

SUBSTITUTES:

HONDA CIVIC

TOYATA COROLLA HYUNDAI SONATA SKODA AUTO- OCTAVIA VOLKSWAGEN JETTA

Cont…….Cont…….

Rivalry Amongst the existing players The growth of the car industry is on a high pace, companies are coming up with new models every

six months.

Rivalry tends to intensify as the number of competitors increases and as they become more equal in size and capacity.

Rivalry is more volatile and unpredictable the more diverse the competitors are in terms of their strategies, personalities, corporate priorities, resources, and countries of origin.

Bargaining power of suppliers

The cars of Maruti are differentiated to such an extent that it is difficult for buyers to switch over to other products.

As Maruti is dominant player in the market holding 50% share in the industry, it is highly attractive to buyers.

Branding- The brand Maruti is strong due to its role of quality and services

Cont…….Cont…….

Bargaining power of buyers

Usually customers appreciate and look for various features in a car. Often there is a loyal set of customers. Cars enhance social status and there may be a strong association of price with quality and status.

Switching costs- It’s easy for buyers to locate new suppliers

Large number of options available

Well informed customers

Availability of finance schemes

Promotional Tools By Maruti In Auto Expo’08Promotional Tools By Maruti In Auto Expo’08

•HUGE BANNERS AND POSTERS

•ALLOWING PUBLIC TO TAKE FEEL

•FREE INSURANCE FOR ON THE SPOT BOOKING

•ATTRACTION THROUGH MODELS

•BROCHERS,PAMPHLETS AND CONTESTS

Which stall did you like the most?

- 19% of the people liked Maruti.

- 22% of the people liked Tata.

- 43% of the people liked Honda.

- 10% of the people liked Hyundai.

- 6% of the people liked others.

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Maruti Honda O thers

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WHAT DID YOU LIKE THE MOST ABOUT MARUTI?

25% OF THE PEOPLE ARE SATISFIED WITH THE PERFORMANCE-27% OF THE PEOPLE ARE SATISFIED WITH ITS RELIABILITY-30% OF THE PEOPLE ARE SATISFIED WITH THE PRICE-18% OF THE PEOPLE ARE SATISFIED WITH ITS LOOKS

P E R F R O MANCER E L IAB IL ITY

P R IC E

L O O K S

DID YOU LIKE THE PROMOTIONAL STRATEGY OF MARUTI?

- 57% OF THE PEOPLE SAID YES

- 43% OF THE PEOPLE DID NOT LIKE IT

Y ESNO

WHICH OF THE THREE MODELS DID YOU LIKE THE MOST?

- 27% OF THE PEOPLE LIKED A STAR CONCEPT

- 38% OF THE PEOPLE LIKED SPLASH

- 35% OF THE PEOPLE LIKED KAIZASHI

0

10

20

30

A S TAR S P L AS H K AIZ AS HI

DO YOU MARUTI 800 WILL BE PREFERABLE AFTER THE LAUNCH OF TATA NANO?

51%OF THE PEOPLE WERE SATISFIED

-49% OF THE PEOPLE WERE UNSATISFIED

Y ESNO

DO YOU THINK THAT MARUTI WILL FACE COMPATITION FROM OTHER NEW CARS?

78% OF THE PEOPLE AGREE

- 22% OF THE PEOPLE DISAGREE

Y ESNO

DO YOU THINK THAT THE FEATURES OF MARUTI HAS IMPROVED IN ITS NEW CARS?

-80% OF THE PEOPLE AGREED

-20% OF THE PEOPLE DISAGREED

Y ESNO

ConclusionConclusion

It can be concluded from the project that Maruti is a brand, which consumers prefer to buy, due to its fuel efficiency and cost effectiveness.

Due to the launch of Maruti’s 3 concept cars that is A-star, Splash and Kizashi customers are willing to purchase and experiment these new

cars with its improved features. Maruti will face stiff competition from others new cars launched in the

market Maruti’s 3 new cars will be successful in the coming market and will

be most preferred by the customers.

Thank YouThank You