A Project Report on Marketing Mix

of

TVS Apache

Submitted toMr. C. Nagapawan

Coordinator and FacultyBusiness Administration

Submitted byApurva Utkarsh(IMBA-2nd Sem)

Session:2010-15

1

Introduction…

- More than US$ 1 billion turnover in 2008-09- India’s 3rd and among world’s top ten two-wheelers manufacturer- Offering 17 products globally including a three-wheeler brand- 15 million customers on the road- Export of more than 2.39 lakh units in 2010-11

TVS Motor which has its roots in the 2nd decade of 20th century as a transport service provider in Tamil Nadu is now a well known brand in India offering a wide range of two-wheelers. The company went on back-foot when its consecutive products failed in the market and Suzuki broke up over the issue of management in the joint venture TVS-Suzuki Motor in 2001. It also faced some labour issues which resulted lockouts in factories.

It was believed that the company has literally died after separating its ways with Suzuki but against all odds and expectations it climbed the 3rd slot in Indian two-wheelers market and has successfully held this position till now. With products like Victor, Apache, Star City, Scooty pep, etc. TVS Motor has successfully built a reputation of its own and is striving hard to replace Bajaj Auto from the 2nd slot in the market.

TVS has been facing problems like unavailability of spare parts and high maintenance cost resulting low resell value of its products and also lower trust at customers’ part. But in recent times the company has been focusing on its after sell services and quality of its products.

2

TVS has three manufacturing units in India at Hosur, Mysore and Nalagarh and 1 in Indonesia focusing on Indonesian and other Asian market.

TVS is one of the pioneers of Indian motorcycle industry with credits of setting trends in the Indian market which are still vital. It was the first company to introduce two-seater moped in India. It launched Fiero in 2000 which is the first 150cc, 4 stroke bike in India.

3

Background…

TVS Motor is the flagship company of TVS Group founded by T. V. Sundaram Iyengar. The group started as a local transport provider in Madurai in 1911. Sundaram-Clayton Ltd. (founded in 1962 which launched TVS 50 in 1980, a 50cc moped) with Suzuki Motor Co. Ltd. of Japan promoted Indian Motorcycle Pvt. Ltd. incorporated in 1982 which was later renamed as TVS Suzuki Ltd. in 1988.

TVS Suzuki launched 100cc bikes- Max 100 in 1984 as its first two-wheeler offering and entered in the bikes market. The company entered in the scooterette market with TVS Scooty in 1994. TVS Motor launched TVS King as its first three-wheeler offering in the market in 2008.

TVS has distinction of launching India’s first ‘Green’ motorcycle- Shogun in 1996 and of launching India’s first 5 speed motorcycle- Shaolin in 1997. TVS launched Fiero in the Indian market in 2000 which was the first 150cc, 4 stroke bike in India. Fiero was re-launched in 2003 to take up Bajaj Pulsar. Victor (fully indigenously designed and manufactured bike) was launched in 2001 and within 18 months it crossed the sales of 4 lakh units. In 2007 the company launched Apache RTR which has racing inspired engine and features.

In 2010 TVS came out in the market with Wego which, a unisexual scooter, is claiming to have unique body balance feature and Jive which is an auto-clutch motorcycle (first of its kind in India).

4

The company separated with Suzuki over the issue of management in the JV in 2001 and renamed itself as TVS Motor. TVS Motor was considered a ‘to-be-shutdown’ company after Suzuki’s exit from TVS Suzuki Ltd. but with its efforts and focus on the market it pulled itself out from the ‘to-be-shutdown’ position and now has a strong presence in Indian two/three-wheeler market.

The company has been focusing much on R&D in recent times as a result of which it has been able to develop VTi technology and products like Jive and Wego which are having auto-clutch and body-balance respectively. TVS develops all types of two-wheelers through its own in house R&D facility.

TVS Motor has presence in 57 countries and has sold 15.34 lakh units of vehicles in FY ended March 2010 showing a growth of 13%. The total revenue of the company stood around 4484 crores in the same FY and has an employee base of more than 7200.

5

Marketing Mix…

Products…

TVS Motor has a strong presence in Indian market with a wide range of offerings including bikes, scooterettes and three-wheelers. Its products are-

Jive (100cc) StaR City (110cc) StaR Sport (100cc) Flame (125cc) Apache RTR 160/160 FI (160cc) Jive Apache RTR 180 (180cc) Wego (110cc) Scooty Streak (90cc) Scooty Pep+ (90cc) Teenz (60cc) XL Super (60cc) XL Super HD (60cc) King (3 wheeler)

Wego XL Super

6

The company has tried to register its presence in the mind of the customers of every segment ranging from 60cc to 180cc but still has failed to capitalize because unlike its competitors it does not offer many options to its customers in most of the segment. When in 150+cc segment Hero Honda and Bajaj offer 4 and 6 products respectively, TVS has only two products in its stores.

In this project we are dealing with one of the best selling existing products of TVS i.e. TVS Apache.

TVS Apache RTR 180

TVS Apache was launched in 2006. It has 4 variants and comes with 160cc and 180cc engine. The RTR and RTR FI version of the 160cc bike was launched in 2007 and it was the first two-wheeler in its segment in India to have racing inspired engine and features. In 2008 a variant of this bike was launched as ‘Hyper Edge’ which is considered as a cosmetic face of Apache RTR 160 FI by the experts (Topgear & Bike India). The 180cc variant of the bike was launched in 2009.

7

TVS targets these group of people for Apache-

College going students

Youth between 18-30 age

People wanting to upgrade to 150+cc

People looking for a sporty & stylish bike

TVS has been frequently refreshing and modifying this bike as the company looks forward to capitalize the premium segment with this product. In 2011 TVS introduced Anti-lock Breaking System in Apache 180 making it the first bike in India to have this feature.

8

Pricing…

TVS has priced Apache very competitively as there is intense competition in 150+ cc segment and Indian customers are more price sensitive. The company offers Apache RTR 180, which comes with unique safety feature i.e. ABS and generates 17.3 bhp, for around Rs.65,000 (ex-showroom, Bangalore) while Bajaj’s Pulsar 180DTSi cost Rs.60,000 (ex-showroom, Bangalore) without such feature and generates 17 bhp.

Price of RTR 160 FI is definitely high but the product provides more value than its competitors.

9

Place…

TVS has a strong distribution channel having dealers in almost every part of India and other countries where it operates. The company has more than 750 dealers (2009) across the country. Its service centres are located across the country facilitating continuous access of Apache to the market.

TVS Logistics Service Ltd. is a subsidiary of TVS Motor which provides logistics solutions to TVS Motor. TVS Logistics Service Ltd. provides logistics solutions also to Mahindra & Mahindra, Ford, Ashok Leyland, Royal Enfield, Tata Motors, etc.

10

Promotions…

TVS had built a reputation of aggressive advertiser when appointed Sachin Tendulkar and Jason Gillespi as brand ambassadors for TVS Victor. This continued when it signed M.S. Dhoni as the brand ambassador of TVS StaR and recently it hired Virat Kohli for TVS StaR Sport. But in case of TVS Apache it didn’t go with any celebrity. The advertisements gave 100% focus on the product and its performance. TVS decided to have only one person speaking for its product and that was Apache itself. The advertisements extensively talk about the awards Apache received in various automobile award functions.

Apache RTR 180 uses the tagline ‘Racing DNA Unleashed’ defining the racing features of the bike.

The company organizes road-shows and exhibition of Apache. Hoardings of Apache bulleting the features and the tagline can be seen at youth oriented public places.

TVS also promotes Apache through TVS Racing. The company organizes rally in different parts of the world. Brochures and pamphlets speak more about the mileage and power of Apache.

11

Positioning…

TVS has very cleverly positioned Apache as a racing oriented bike. It uses the RTR (Racing Throttle Response) sticker boldly on the body of Apache. In every advertisement TVS has been focusing on the racing aspect of its products by showing a guy riding Apache and leaving every other behind.

Apart from racing features TVS talks about the power of the bike which is directly related to the performance of the bike on road.

TVS also organizes road-shows and rallies to promote its product through TVS Racing. It runs a special Apache racing club.

TVS Apache 180 RTR is accompanied by the tagline that says- ‘Racing DNA Unleashed’. The advertisement highlights the text ‘Racing DNA Unleashed’ and ’17.3 bhp’ to strengthen its position as a premium segment racing bike.

Apache has also established itself as a trustworthy brand by continuously performing well at different auto award functions like NDTV Car & Bike Awards, Overdrive Awards, etc.

12

What’s next…??

Apache is a vital product for TVS Motor as the sales of TVS Motor grew up by 6% during 2009-10 while in the same financial year sales of TVS Apache grew by an impressive 26%. Also Apache is the only offering by TVS in premium segment. TVS has no products in 200cc or 200+cc segment. Its absence in these segments is enjoyed by Hero Honda, Bajaj, Honda and Yamaha, particularly by Bajaj Pulsar 200/220 and Hero Honda Karizma.

Apache, being a tested and trusted product, will definitely be a tough competitor in 200 or 200+cc segments. The market is looking forward to Apache as TVS has confirmed the roll-out of an upgraded Apache.

A question everyone is asking…

What will be the displacement of Apache… 200cc or 220 cc…??

…Well Mr. Srinivasan knows it better…

13

Bibliography

TopGear

Bike India

Website of TVS Group

Website of TVS Motor

Website of TVS Apache

14