144367171 12881447 Maruti Suzuki Market Strategy

7/27/2019 144367171 12881447 Maruti Suzuki Market Strategy

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Jai Prakash Choudhary Nishant Bhadauria

MBA PM

UNIVERSITY OF PETROLEUM AND ENERGY STUDIES


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Car Segments

Maruti Suzuki Portfolio

Strategies (Marketing and Promotion)

Competition


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Suzuki Motor Company was chosen from seven prospective

partners worldwide. This was due not only to their undisputed

leadership in small cars but also to their commitment to

actively bring to MUL contemporary technology and Japanese

management practices . A license and a Joint Ventureagreement was signed between Govt of India and Suzuki

Motor Company (now Suzuki Motor Corporation of Japan) in

Oct 1982

Suzuki brought efficient management practices,bettertechnology and administration.

Initially Suzuki held the 26% stake in Maruti Suzuki .

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Maruti was the first company in India which studied the consumerdemand and responded to it well.

Market segmentation policy was adopted that targeted different typeof consumers with different type of models.

Maruti800 targeted medium income group,while the deluxe modeltargeted rich income group.

Maruti van targeted businessmen and doctors(ambulance)

The Gypsy targeted the paramilitary forces and the police.

This resulted in complete control of maruti over the market .

The company advertised its different products according to costumerse.g- maruti van was rechristened as Omni .

A special cell was made to make direct dealing of Gypsy with thegovernment & the army.

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The MUL depended more on its M800

model, so when in late 1990s the new

players like when Matiz, Santro and Indica

came into the market with more space and

better comfort ,at same price, then Maruti

lost a major share of market.

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After year 2000,(and 2003 to be moreprecise)there was a change in automobilemarket which where due to-

1. The government has reduced regulation onthe industry and more foreign players wereinvited.

2. Banks and other financing companiesstarted providing car loans at reasonableinterest rate

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The Indian consumer now started buying

the mid-size cars rather than small cars

,the luxury cars also gained

popularity,SUVs also started coming in the

market.

The increasing level of income of urban

people ,the small cars were not consideredto be luxury item any more.

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To gain back its lost share Maruti launched Zen ,Alto andWagonR.These small segment car gained huge response forconsumers.

Maruti also launched aggressive promotional policy to promote themlike announcing Zen as the worldscar.

Maruti also made a slogan count on us.To emphasize its reliability In 2003 maruti came up with change your life campaign ,it provided

vehicle insurance at just Rs 1 to attract the customers. advertisment such as of Alto in which a small boy says to his father

papa ki karan petrol khatam hi nahi honda was make customer feelthat Alto was best fuel efficient.

During 2003 and 2004, MUL visualized and implemented a strategy

for its dealers to increase their profitability levels in view of increasedcompetition. According to the strategy, the 300-odd dealers of thecompany were asked to strengthen their manpower, increase thesalaries of their sales agents, and offer them better incentives.

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During 2003 and 2004, MUL visualized and implemented a strategyfor its dealers to increase their profitability levels in view of increasedcompetition. According to the strategy, the 300-odd dealers of thecompany were asked to strengthen their manpower, increase thesalaries of their sales agents, and offer them better incentives.

'2599' offer-In 2004, MUL introduced the '2599' offer under which aconsumer could buy an M-800 by paying an EMI of Rs 2,599 only,for a period of seven years. The down payment was fixed at Rs40,000. MUL entered into an agreement with the State Bank of India(SBI), the largest bank in India, to promote this scheme

'Teacher Plus' scheme-To further penetrate into the market, MULcontinued to focus its efforts on the rural markets and specific targetgroups. In 2004, it introduced the 'Teacher plus' scheme, in a tie-upwith SBI, aimed at teachers who were interested in buying a new car.

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Segmen

t Price Range CarsA < 3.0 lacs Maruti 800, Omni , RevaB 3.0 -5.0 lacs Wagon R, Zen, Versa, Ambassdor, Fiat

Palio, Esteem, Tata Indica, IndigoC 5.0 -10.0 lacs Baleno, Elantra, Honda City, Lancer,

Innova, Sx4D 10.0 -15.0 lacs Octivia, Corolla, CivicE 15.0 30.0 lacs Honda CRV, Maruti Grand Vitara,

Honda Accord

http://www.surfindia.com/automobile/automobile-industry.html


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The Journal of Business Perspective, Vol 10, No 1: Jan - Mar 2006


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The Maruti 800, has gone beyond just a car, it

has actually changed the lives and lifestyles of

countless people, by bringing the joy of motoring

to millions across the length and breadth of thecountry


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The alto is a great combination of economy ,

practicality and styling. A runaway success on

the roads of Europe, it exemplifies thebenchmark in build, quality and reliability in a

compact car. This is testified by the 24-hour

endurance record set on Aug 03, 2003 of

covering 3082 kms in 24 hours at an averagespeed of 128kmph.


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The Omni is truly Indias original Multipurpose

vehicle. Today it is available in 6 Avtars 5

Seater, 8 Seater, Cargo, Ambulance, CNG andLPG. It meets diverse needs across different

user segments and can double up both as a

people carrier and a goods carrier. This faithful

workhorse is easy on the pocket, yet tough onthe job.


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A Spanish expression for Style, the new Zen

Estillo stands true to its name. Its aerodynamic

body, unique bean shape, sparkling colors andsnazzy lights will rev up your style quotient. An

amazing blend of style and substance, its agile

nature will leave you enthralled.


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Drive with complete peace of mind. The word-

class safety features of the wagonR keep you

safe and secure, always. Wearing new vibrantcolors, the new wagonR is full of freshness

and energy to keep you charged up and

always to go.


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76% of Maruti cars are financed

44% through Maruti Finance, 12 % through SBI

and associate banks

In year 2006-07, it added Mahindra Finance,

Magma Leasing , Cholamandalam and Axis

Bank.


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SegmentA

SegmentB

SegmentC

0

25

50

75

100FY02 FY03

Segment A:

Maruti 800, Omni

Segment B:Zen, Alto, Wagon R

Segment C:Swift, Esteem, Baleno


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Maruti 800

Omni

Alto

WagonR

Swift Zen

Gypsy

Esteem

Versa

SX4

Grand Vitara


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HYUNDAI SANTRO

TATA INDICA

CHEVY SPARK


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+ Santro rated Best Small Car in JD Power Asia Pacific Initial Quality and APPEALstudies.+ European styling , power-assisted brakes, advanced suspension system and uniquely

responsive engine.+ Celebrity endorsed (Shahrukh Khan and Preity Zinta).+ Hyundai had a national network of 300 sales and service outlets.- The spares are expensive than that of Maruti

- TATA INDICA

+ Car built for Indians by Indians+Ambassadors internal dimension and Maruti 800s price with option of diesel engine+ Has a sleek fascia with chrome lined grill, clear lens illumination, muscled flares, flexible

seating and electronic instrumentation with tachometer.+ Cheaper and home grown spares.

+ Has lowest running cost (around Rs. 2.06 /km)

Chevrolet SparkGeneral Motors rolled out its small car Chevrolet Spark in India as it takes on market leader

Maruti Suzuki.

+ Rs 3.09 lakh (Ex-showroom Delhi) slightly lower than Marutis Zen Estillo base model.

Improved cabin space21


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Dealer network across the countryA wide dealership network allows the company to service customers over a wider

geographical area than competitors. Currently, MUL has 500 sales outlets that cover312 cities, as compared to 162 outlets of Hyundai Motors and 140 outlets of TataMotors

B True Value Operations

MUL providing its customers an opportunity to resale their car to MUL or exchange with anew Maruti car under its True Value network has proven really beneficial. In FY07True Value network touched 10000 units a month and more than 90% of that resultedin the exchange of a new car

C Presence across segments

In a car manufacturing plant, the press shop, paint shop, engine and transmissionassembly, and machine shop are used for manufacturing different modelsA presenceacross various segments ensures that the company retains its existing customers byoffering them upgrades from its portfolio of models.

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Maruti Suzuki is far behind in luxury andSUV car ,the other player likeGM,TATA,Mahindra ,Mitsubhisi and Toyota

are already established in the market ,soreplacing them would not be easy.

MUL has been now emphasizingconsistently on its Best customer

satisfaction car to keep an psychologicalimpact on costumers.


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Advertisements targeting different

segments

Promotional offers through out the years

Psychographics is used : Wagon-R : Smarter people (executives)

Omni : People who need to transport goods

Alto : Small car : small family Zen Estillo : Young trendy people

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Maruti has launched two luxury models

SX4 in 2006 and A STAR in Nov 2008

,these two models are facing intense

competition from already established

companies.

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Thank You

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144367171 12881447 Maruti Suzuki Market Strategy

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