Академический Документы
Профессиональный Документы
Культура Документы
: -
1
The Indian two wheeler industry has seen a paradigm shift from
being a regime of regulation and tight control in the 1980s to a
more liberalised and a competitive present day era. After missing
out on the initial boom in two wheeler segment during the period
of 1993-1996, Hero Honda has emerged as a world leader. The gap
between motorcycles sold by Hero Honda and its closest rival is
approximately 1 m units (23% of industry size). One of the reasons
for the tremendous performance of Hero Honda is the significant
increase of share of motorcycles in the two-wheeler segment, from
42% in FY99 to 77% in FY04. No doubt, that the shift in
preference of Indian populace from scooters and mopeds towards
motorcycles has facilitated the growth of Hero Honda. However its
performance vis-à-vis industry indicates that the performance of
Hero Honda was better than the industry peers, barring two years.
In the seven-year period ending FY04, it has achieved a CAGR of
30% in two-wheeler volumes against 11% of the industry.
As can be seen from the table below, the company the sales as well
as the profits have increased enormously. The company net sales
2
has shown a CAGR of 27% and net profits have shown a CAGR of
39% led by its motorcycle led dominance. The operating margin of
the company has improved by 290 basis point to 16.8%.
3
Ratios FY00 FY01 FY02 FY03 FY04
RONW 20.0% 100.0% 100.0% 100.0% 100.0%
ROCE 37.8% 36.5% 58.5% 59.0% 55.5%
Debt Equity (x) 0.1 0.1 0.2 0.2 0.2
Interest coverage (x) 57.8 151.9 417.0 465.7 527.2
Dividend payout 0.9% 0.6% 0.4% 0.4% 0.3%
BVPS 111.1 30.5 33.8 42.5 57.0
SUZUKI (ZEUS)
5%
TVS
(APACHE)
14% BAJAJ AUTO
(PULSAR)
YAMAHA 62%
(RX 135)
4%
4
Hero Honda Splendor
Hero Honda Splendor has come up with all possible features of any
standard bikes. Apart from these features, this bike also has many
advanced and customer friendly features. This bike is equipped
with every safety and comfort features for the convenience of the
biker.
• Super Splendor
• Splendor +
• Splendor NXG
Super Splendor
This Bike comes with 125 cc new generation quantum core engine
with an output of 9 bhp (6.7 kw). Its relaxing seating arrangement
with other comfort features like less strain while clutching and
declutching, low noise and less vibration engine etc, makes it more
market friendly bike.
5
For the convenience of the biker, there are few features included
here are trip meter, peep hole, large utility box etc. Some safety
features included here are pass switch and push cancel indicator
switch, muffler with heat shield etc.
• Frost Blue
• Cloud Silver
• Mono Tone Black
• Dual Tone Black
• Blazing Red
Splendor +
Its double cradle frame gives the steadiness in biking. Its wider
1230 mm wheelbase provides the proper base for safer riding.
6
Lighting fitting included in it like multi reflector with halogen bulb
makes the biking secured at every time.
Splendor NXG
7
Splendor NXG comes with a new engine and pioneering features
and combines stylish looks with a high performance engine. It
features trapezoidal multi -reflector headlamps which is powerful
even at low speeds. This is achieved by powerful battery which
powers the DC high beam in the headlamp and its strength is not
dependent on the engine rpm. Circuitry for the low beam and pilot
lamp has also been enhanced for low variation in intensity arising
from changes in the engine rpm.
It features:
Splendor NXG is available in a range of five attractive colors and
seven stripe combinations.
8
• 160mm of ground clearance.
Colors
Best in its class awards for each category by TNS Total Customer
Satisfaction Awards 2006:
• Splendor Plus (Executive)
• CD Deluxe (Entry)
Geographical Segmentation
9
Geographic Segmentation calls for division of the market into
different geographical units such as nations, states, regions,
countries, cities, or neighborhoods. In the South Asian context,
geographic segmentation assumes importance due to variations
in consumer preferences and purchase habits across different
regions, across different countries, and across different states
in these countries.
Demographic Segmentation
Psychographic Segmentation
10
groups on the basis of psychological/personality traits, lifestyle,
or values. People within the same demographic group can
exhibit very different psychographic profiles. Values and
lifestyles significantly affect product and brand choice of
consumers. Religion has a significant influence on values and
lifestyles. The strict norms that consumers follow with respect
to food, habits or even dress codes are representative examples
in this regard.
Innov
at-ors High Resources
High Innovation
Primary
Motivation
Believer
Strivers Makers
s
Low Resources
Low Innovation
Surviv
ors
11
2. Thinkers- mature, satisfied, and reflective people who are
motivated by ideals and who value order, knowledge and
responsibility. They seed durability, functionality, and value in
products.
3. Achievers- successful, goal-oriented people who focus on
career and family. they favor premium products that demonstrate
success to their peers
4. Experiences- Young, enthusiastic, impulsive people who
seek variety and excitement. They spend a comparatively high
proportion of income on fashion, entertainment and socializing.
like to work with the hands. They seek products with a practical
or functional purpose.
4. Survivors- Elderly, passive people who are concerned about
12
Behavior Segmentation: -
In behavioral segmentation, marketers divide buyers into groups
on the basis of their knowledge of, attitude toward, use of, or
response to a product.
Decision Roles: - People play five roles in a buying decision:
Initiator, Influencer, Decider, Buyer and User. Recognition of
the different buying roles and specification of the people who
play these roles for specific products and services are vital for
marketers. This is especially useful for designing the
communication strategy.
Behavioral Variables: - Many marketers believe behavioral
variables-occasions, benefits, user status, usage rate, buyer
readiness stage, loyalty status, and attitude-are the best starting
points for constructing market segments.
Market Targeting: -
Effective Segmentation Criteria
To be useful, market segments must rate favorably on five key
criteria:
Measurable, the size, purchasing power and characteristics
of the segments can be measured.
Substantial, The segments are large and profitable enough
to serve. A segment should be the largest possible
homogenous group worth going after with a tailored
marketing program. It would not pay, for example, for an
13
automobile manufacture to develop cars for people who are
less four feet tall.
Accessible, The segments can be effectively reached and
served.
Differentiable, The segments are conceptually
distinguishable and respond differently to different
marketing-mix elements and programs. If married and
unmarried women respond similarly to a sale on perfume,
they do not constitute separate segments.
Actionable, Effective programs can be formulated for
attracting and serving the segments.
Single- Segment
Concentration
M1 M2 M3
P1
P2
P3
Selective Specialization
M1 M2 M3
14
P1
P2
P3
Product Specialization
M1 M2 M3
P1
P2
P3
Market Specialization
M1 M2 M3
P1
P2
15
P3
M1 M2 M3
P1
P2
P3
16
moneymaker. This multisegment strategy has the advantage of
diversifying the firm’s risk. When Procter & Gamble launched
crest Whitestrips, initial target segments included newly engaged
women and brides to be as well as gay males.
17
(vehicle market), and coca-cola (nonalcoholic beverage market),
can undertake a full market coverage strategy. Large firms can
cover a whole market in two broad ways: through undifferentiated
marketing or differentiated marketing.
Additional considerations
Two other considerations in evaluating and selection segments are
segment-by-segment invasion plans and ethical choice of market
targets.
18
Positioning: -
Positioning is the act of designing the company’s offering and
image to occupy a distinctive place in the minds of the target
market, the goal is to locate the brand in the minds of consumers to
maximize the potential benefit to the firm. A good brand
positioning helps guide marketing strategy by clarifying the brand’
essence, what goals it helps the consumer achieves, and how it
does so in a unique way. Everyone in the organization should
under- stand the brand positioning and use it as context for making
decisions.
19
♦ Congested areas of urban cities.
♦ Males/Females between the age group of 18-36
♦ Middle class people , mostly officials & executives
The client analysis from our questionnaire it was found that our
client has targeted the right segment
HHML & TVS is overlooking one feature in bike which is its low
maintenance cost and reliability (i.e. less chances of breakdown)
which is absent in its competitors. Therefore, in order to meet the
sales target, two options are available with the client; one is to
redesign the bike and second is to reposition the bike as “Bike with
one time investment”. Since redesigning of bike may involve a big
task and huge investment therefore we recommended repositioning
the bike.
Product:-
Core Product: -
The core product or benefit of Hero Honda Splendor is Travelling
and saving the time by reach on desire place at right time.
Basic Product: -
The basic product of Hero Honda splendor are Engine, Handle,
Shockers, Wheels, Gear box and chain set etc.
Expected Product: -
The expected products of Hero Honda splendor are: -
1. It should be 5 gear gear box.
2. It should be 90 Kmpl mileages.
3. It should be 120 Km/hour Maximum speed.
4. It should be disk brake or power brake.
5. It should be steel body.
20
Augmented Product: -
The augmented products of Hero Honda Splendor are: -
1. It provides monthly check up for decrease the pollution.
2. It provides fast service of the product.
Pricing Strategy: -
Penetration Pricing: -
The price charged for products and services is set artificially low in
order to gain market share. Once this is achieved, the price is
increased. This approach was used by France Telecom and Sky
TV.
Hero Honda Used penetration pricing strategy because that time
Hero Honda use National Segment and low income persons so they
used penetration strategy.
Price Skimming: -
Charge a high price because you have a substantial competitive
advantage. However, the advantage is not sustainable. The high
price tends to attract new competitors into the market, and the price
inevitably falls due to increased supply. Manufacturers of digital
watches used a skimming approach in the 1970s. Once other
manufacturers were tempted into the market and the watches were
produced at a lower unit cost, other marketing strategies and
pricing approaches are implemented.
Premium pricing, penetration pricing, economy pricing, and price
skimming are the four main pricing policies/strategies. They form
21
the bases for the exercise. However there are other important
approaches to pricing.
Promotion: -
Below the Line Promotion: -
‘Below The Line is a common technique used for touches and feel
products. Those consumer items where the customer will rely on
immediate information than previously researched items. Below
The Line techniques ensure recall of the brand while at the same
time highlighting the features of the product.
Above The Line Promotion: -
Above the line (ATL) is an advertising technique using mass media
to promote brands. Major above-the-line techniques include TV
and radio advertising, print advertising and internet banner ads.
This type of communication is conventional in nature and is
considered impersonal to customers. The ATL strategy makes use
of current traditional media: television, newspapers, magazines,
radio, outdoor, and internet.
Hero Honda used Above the Line Promotion because in the Above
the Line promotion co. members used advertisement through
Radio, T.V., Newspaper and Other media communications.
Place: -
1. Local
2. National
22
3. Regional
4. International
Hero Honda used National Market for sale the Hero Honda
Splendor.
BIBLIOGRAPHY
• www.herohonda.com
• Marketing management, 13th edition, Kotler, Keller,
Koshy, and Jha, Pearson Education.
• www.marketingteacher.com
• www.scribd.com
23
24