Principles of MarketingGroup #1

Market Scenario

• Total market size in 2009 was 110,000 vehicles.

• Currently 4 OEMs are operating in Pakistan.

• PSMCL (Pak Suzuki Motor Company Limited) is the market leader with 49% market share, where Indus Motors is 39%, Honda is 10% and Deewan Motors is 2%.

• As the over all market size increased this year, PSMCL is projecting to achieve more than 60,000 units of sales.

Market SegmentationGeographic Segmentation• Pakistan• Density: Urban Areas

City Location Population Growth Rate

Karachi Sind 13,205,339 2.86

Lahore Punjab 7,129,609 2.71

Faisalabad Punjab 2,880,675 3.02

Rawalpindi Punjab 1,991,656 2.90

Multan Punjab 1,606,481 2.46

Hyderabad Sind 1,578,367 2.66

Gujranwala Punjab 1,569,090 2.74

Peshawar NWFP 1,439,205 3.36

Quetta Baluchistan 896,090 4.03

Islamabad Capital Territory 689,249 2.25

Market SegmentationDemographic Segmentation

Annual IncomeOptions Percentage

Under 10 Lac a 37%11-20 lac b 24%21-30 lac c 18%31-40 lac d 8%41-50 lac e 7%

over 50 lac f 6%

Family Size

Options Percentage

1 or 2 person a 6%

3 - 5person b 34%

6 or 7 person c 31%

8 and above d 29%

Age GroupOptions Percentage

0-17 years a 41%18-30 b 28%

31-45 c 16%

46-59 d 9%

Over 60 e 6%

Psychographic Segmentation

• Social Class: Upper Middle class and Lower Upper class• Lifestyle: Innovators, Achievers, Passionate• Personality: Fun loving, Young, Exciting

Behavioral Segmentation

• Attitude: Those who feel young at heart.• Benefits Sought: trendy, classy and easy to handle.• User Status: New users, potential users

Market Segmentation

Target MarketMARKET TARGETING STRATEGY

• Pak Suzuki uses a DIFFERENTIATED MARKETING STRATEGY with separate products for specific segments.

• During last 3 years in Pakistan, average 52 percent of the total cars were sold in the hatchback category.

Market TargetingTarget Segments

Age GroupOptions Percentage

0-17 years a 41%18-30 b 28%

31-45 c 16%

46-59 d 9%

Over 60 e 6%

Family Size

Options Percentage

1 or 2 person a 6%

3 - 5person b 34%

6 or 7 person c 31%

8 and above d 29%

• Annual Income of more than Rs. 5 lacs (monthly income = Rs. 40000+)

Target Market

Therefore Target Market Segments are:

“YOUNG AT HEART” individuals. Professionals and Executives. People interested in “reconditioned” CBU (Complete Built

Unit). Innovators - Trendy individuals who are aspiring for CHANGE.

SWOT Analysis

STRENGTHS

• Powerful Engine rare in Hatchback Category.• Stylish and Trendy• Available in 7 different colors.• Largest 3S (sales, service & spare parts)• Easy availability of spares.• Better Handling.

WEAKNESSES

• According to potential customers, high price for a Suzuki hatchback.

• Not available in automatic transmission.• Bad image of Suzuki with respect to

durability.• Failure of last two 1.3L Suzuki Models

(BALENO, LIANA).

OPPORTUNITIES

• Support of Govt. for local market against reconditioned CBUs.

• Suzuki has the largest market share• Growing Demand for Small and Mid

size Cars

THREATS

• Foreign companies entering market; so a bigger threat from MNCs.

• Increasing Costs of Input.• Increasing Inflation rate

Competitors

Engine CapacityThe Pak Suzuki is targeting the market between the 1000cc (with hatchback) and 1300cc category, however, the competition will be stiff as this segment is already crammed by two major competitors

• Toyota Corolla (with 69 percent of market)

• Honda City (17 percent share)

Design Comparison• Toyota Vitz• Toyota IST• Hyundai Santro• Suzuki Cultus

Competitors can be classified in terms of

Comparison in Design CategoryFeatures Swift Vitz IST

CC 1300 1000 1300

Model Latest Used / old Used / old

Price 1,049,000 .9 m – 1 m 1.05 m +

EPS X X

Immobilizer X X

ABS with EBD

Tire Size 185/60R15 155/80R13 185/65R15

Tumble-Folding Back Seat X X

Tilt Steering

Pollen Filter X X

Power Windows

Central Door Locking

Key less entry X X

CD + AM/FM tuner (2 Din with MP3)

Comparison in 1300cc CategoryToyota

Corolla 1.3L GLi

Honda City Suzuki Liana 1.3L RXI MT

Suzuki Swift 1.3L

PriceRs.

1,414,000Rs.

1,249,000Rs. Rs.

1,099,000Rs.

1,049,000

Displacement (cc) 1299 1300 1300 1300

Overall Length (mm) 4540 4395 4495 3755

Overall Width (mm) 1760 1695 1690 1690

Overall Height (mm) 1480 1480 1545 1525

Transmission Manual Manual Manual Manual

Fuel System EFI with VVTI EFi EFi Multipoint Injection

Marketing Strategy

Positioning Statement

For people who want fun and Enjoyment through driving experience so SWIFT is the right choice for them.

Feel Young Drive Young

Marketing Strategy

4 P’s of Marketing

Marketing StrategyProduct

As a product it is luxuries, cool, smooth and sporty in driving powered by 1.3 L MPI Engine

Features Swift

CC 1300

Model Latest

Price 1,049,000

EPS

Immobilizer

ABS with EBD

Tire Size 185/60R15

Tumble-Folding Back Seat

Tilt Steering

Pollen Filter

Power Windows

Central Door Locking

Key less entry

CD + AM/FM tuner (2 Din with MP3)

ColorsSilky Silver White Graphite Grey

Pearl Red Aqua Blue Eminent Blue

Indica

Marketing StrategyPromotion

ABOVE THE LINE

TV

Print Ad

Radio Spot

Hoardings

Special Website

Posters

Banners

Events

Direct Mail Shots

Test Drive

Sales Training

BELOW THE LINE

Marketing StrategyPlace

• Manufacturing plant is situated at Pakistan Steel Industrial Estate, Bin Qasim, Karachi.• More than 70 3S dealers are located all over the country

Marketing StrategyPrice

Product Version Price

SWIFT Deluxe 1049,000

• Pricing is the key: If the prices in the 1300cc segment are analyzed, showroom price of Toyota Corolla (1.3 GLi) is Rs 1.414 million followed by Honda City (1.3L MT) Rs 1.249 million and Liana Rs 1.1 million.

• To provide a cushion for Suzuki Swift 1.3L , the price of Liana is increased by Rs. 50,000 and Cultus VXLi model has been discontinued.

Marketing StrategyPrice

Payment DetailsCar Description: Swift DLXCost Price: Rs. 1,049,000.00/-Tenure: 5 Years

Initial PaymentSecurity Deposit: Rs. 209,800.00/- (20%)Processing Fee: Rs. 4,000.00/-

Total: Rs. 213,800.00/-Monthly Payment

60 Monthly Rentals of Rs. 24,507.00/- approx.