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Executive summary Brief history of the organization

09-18

Organization structure

19-22

About Maruti True Value

23-27

Mission, vision and philosophy of the org.

28

Performance

29-41

Product/services

42-82

“CUSTOMER PROFILING & PURCHASE

PROJECT REPORT

PARAMETERS”

INDEX

Part-1

Page no.

ON

A

1

 Objective 84  Research methodology 85-88  Analysis (SWOT analysis) 89-111  Findings 112 
 Objective
84
 Research methodology
85-88
 Analysis (SWOT analysis)
89-111
 Findings
112
 Conclusion
113
 Suggestion/Recommendation
114-115
 Limitations
116
 Annexure
117-120
 Bibliography
121-123
Part-2
2

Comprehensive chapter about the Organization which should incorporate

Part-1

Words of thanks

124

3

Maruti Udyog Limited (MUL) was established in Feb 1981 through an Act of Parliament, to meet the growing demand of a personal mode of transport caused by the lack of an efficient public transport system. Suzuki Motor Company was chosen from seven prospective partners worldwide. This was not only due to their undisputed leadership in small cars but also to their commitment to actively bring to MUL contemporary technology and Japanese management practices (which had catapulted Japan over USA to the status of the top auto manufacturing country in the world). A license and a Joint Venture agreement were signed between Govt of India and Suzuki Motor Company (now Suzuki Motor Corporation of Japan) in Oct 1982. The objectives of MUL then were: Modernization of the Indian Automobile Industry, Production of fuel-efficient vehicles to conserve scarce resources, Production of large number of motor vehicles which was necessary for

BRIEF HISTORY OF ORGANISATION

4

economic growth.

5

Maruti created history by record production in 13 months. On 14 December 1983, the then Prime Minister of India, Mrs. Indira Gandhi, handed over the keys of the first car to Mr. Harpal Singh of Delhi. Volume targets were routinely exceeded, and in March 1994, it became the first Indian company to produce over one million vehicles, a landmark yet to be achieved by any other car company in India. Maruti is the highest volume car manufacturer in Asia, outside Japan and Korea, having produced over 3.5 million vehicles by December 2001. Maruti is one of the most successful automobile joint ventures, and has made profits every year since inception till 2000-01. In 2000-01, although we generated operating profits on an income of Rs 92.5 billion, high depreciation on new model launches resulted in a book loss. We are again on track for profits in 2001-02, with a profit of Rs 300 million in the first half. In this period, sales were increased by 5.3%, against an industry decline of 6.1 %. We revolutionized the wav Indians looked at cars. "No other car company so completely dominates its home market" - (The Economist). Despite there being 11 companies now in the passenger car market, Maruti holds about 60 % of the total market share. MUL is also the first and only car company in the world to lead its home market in terms of

The Revolution

6

Suzuki is a smooth process. Great stress is laid on training and motivating the people who maintain the equipment, since the best equipment alone cannot guarantee high quality and productivity. From the beginning it was a conscious decision to send people to Suzuki Motor Corporation for on-the- job training for line technicians, supervisors and engineers. This helps them to imbibe the culture in a way that merely transferring technology through documents can never replicate. At present 20 % of our workforce is trained under this program.

Our employees are our greatest strength and asset. It is this underlying philosophy that has molded our workforce into a team with common goals and objectives. Our Employee-Management relationship is therefore

characterized by: Participative Management, Team work, Kaizen, Communication, Information sharing, and an open office culture for easy accessibility to implement this philosophy. We have taken several measures

both market share and in the JD Power Customer Satisfaction study (JD Power Asia Pacific 2000 India Customer Satisfaction studies).

imperative that the transfer of contemporary technology from our partner

Every minute two vehicles roll out of the Maruti Plant. It is therefore

Transfer of Technology

Our Ethos

7

outside Japan. Becoming a global player is the resurgent theme of Maruti's future strategy in the post-privatization phase as listed in the IPO offer document filed with SEBI. In terms of manufacturing processes or quality systems or even R&D, the flavor is global. Clearly, the company wants to build on its leadership in the domestic market and make a place for itself in the global arena. After sharp gains in productivity and quality in the past two years, the company wants to further improve its operating efficiencies by cutting costs by 30% and enhancing productivity by 50% and align itself with Suzuki's Kosai plant in Japan by year '04-05. On the quality front, while Maruti was

uniforms (at all levels), and a common canteen for all. This structure ensures better communication and speedy decision making processes. It also creates an environment that builds trust, transparency and a sense of belonging amongst employees.

like a flat organizational structure i.e. there are only three levels of responsibilities ranging from the Board Of Directors, Division Heads to Department Heads. Other visible features of this philosophy are common

New Delhi: With the enhanced backing of Suzuki, Maruti Udyog is gearing up to become a global scale player and will be a R&D centre for Suzuki cars

Maruti eyes Global Pie, to be R&D Hub for Suzuki

8

amongst the first automobile manufacturers in the world to receive the ISO 9001:2000 certification, it wants to go further and adopt Suzuki's global customer audit index. But the biggest shift is in the area of R&D. Although Maruti has gained from its expertise in localization of components, it now wants to take R&D to another plane where it can become Suzuki's centre for cars in Asia, outside Japan. In fact, it has recently acquired the capability to conduct minor and major face lifts to its products and upgrade products in terms of technology or features. To reduce initial investment on models, Maruti may outsource dye from other than Japan, such as Taiwan, which are often less expensive. Maruti's initiatives are based also on its recent success in the export market. It sold nearly 24,000 units of the Alto in Europe last fiscal and its overall exports were up by a whopping 163% over the previous year. Its global ambitions are also now nurtured by the backing of Suzuki Motor Corporation. The prospectus makes this point by Sayin2 that as a subsidiary of Suzuki, Maruti has "access to globally respected technology in the small car segment.”

Even while maintaining the overall global theme, Maruti wants to leverage

9

its local advantage. Its promise of providing customers a "wide range of Maruti branded services at different stages of ownership" is at par with other global manufacturers. It lays great emphasis on these Maruti branded services like insurance, finance and pre-owned cars, and believes that this "360 degree customer experience" will secure repeat purchase and increase revenue of the sales network. In supply chain initiatives as well, Maruti's reference is to the world wide purchase system fostered by General Motors.

From a loss of Rs 269 crore in 2000-01, after being written off by many analysts, Maruti has bounced back: its 800 model is as popular as ever, new launches are picking up. Jagdish Khattar, managing director Maruti, spoke to Vinay Pandey on Maruti's transformation. Excerpts: Maruti's turn around:

To understand Maruti today, you need to go back to 1993 when liberalization took place and foreign manufacturers were allowed to come. Maruti should have taken proactive measures then. But between 1995 and 1998 our shareholders (the government and Suzuki) had differences.

Through this, it could make a select few of its vendors the sole suppliers for Suzuki products in several countries.

Our focus will continue to be the small car: Jagdish Khattar

should have been

prepare for

the mid-90s

Decisions

taken in

that

to

10

competition got delayed. In June 1998, we decided to increase our capacity by one lakh vehicles and to introduce four or five new models, which arrived a year and a half after our competitors', who gained from this. Two, investments that should have been done over five years were done in 24 months in a hurry to launch new models. So, localization was low, the yen was strong, prices were market- determined, depreciation increased, and we ran into losses. That's when you got the feeling Maruti was in trouble. But internally, it was a very good wake up call, which did a lot of good to us. We brought out models, localized faster, cut costs massively. So even when everyone thought we were in trouble, we were confident that we'd bounce back. Our market share went down to 61%, but we've now stabilized around 58-59%. We took off a bit late, had lot of catching up to do, which we've done. Role of M800: People say 800 is old and so on. But go on the road and see someone on a two-wheeler, wife and two children, in rain, in winter, in summer. Is he going to be bothered about power windows and steering, or does he wish to be in a car and be comfortable?

Today we're selling air-conditioned 800s at Rs 2.2 lakh. Many people

11

buying AC 800s may not have an AC at home. So, look at the tremendous role it is playing. India's car penetration is six per 1,000; Pakistan and Sri Lanka are at 12. Thailand is at 200, Japan and America are over 500-600. What I'm saying is that there's still a huge gap. If our motorization has to increase, we can't do that by selling expensive cars. We need to make cars more affordable. Therefore, a narrower gap between two-wheelers and entry-level cars is what's required. It should also have good performance, no compromise on quality, fuel-efficient and low on maintenance. The 800 fits the bill. The Alto can't replace the 800 today because the volume and price at which 800 is selling, we can't sell Alto at that. Yes, once we get costs under control, we'll position the Alto between segments A and B. We'd like to have a car from the entry level to Rs 3-3.5 lakh at every Rs 20,000- Rs 25,000 difference. Success of new models: Historically, Maruti's new models never start with a bang. I joined Maruti in 1993 when Zen was introduced and we found it hard to sell initially. We had to reduce our production plan drastically, but then after a year or two it caught on. And look what it is today.

So, initially there's skepticism,

and share their

people buy

then some

12

experience. About 60-70% of our sales take place by referral. I'm not saying marketing is unimportant, but there's nothing more effective than a present owner giving a good chit to prospective buyer. We're seeing the same effect with Wagon R, which is doing really well now. Versa is slightly different. When we decided on Versa, in 1998, the government had announced that in April 2002 the administered price mechanism (APM) for oil would be abolished. The gap between petrol and diesel prices would have then been negligible. Versa came, but APM remained. Now there is no hell of a chance of anyone buying a petrol version when a diesel alternative is available for the same purpose. For the Versa we've carried out a lot of localization, the pricing has been reworked and things are looking up. But some amount of disadvantage between petrol and diesel will remain. Those who bought the Baleno are very happy. Also, view it from our perspective. We launched five models in a space of 12 months. We had to prioritize. Because of low localization, we were losing money on Baleno. So it made no sense to just gain numbers. Now some localization has taken place and the product is getting its due. The Vitara is different, it's not manufactured here. We'll import what is

13

required. Anyway, our core competence and focus would be the small car because that is what the county needs and that is where the volumes are. Let us look at it in another way. There are only four major players in the small car segment - Telco, Fiat, Hyundai and Maruti and 80 % of the market is the small car segment. In the remaining market, there are a dozen players. It is a very lopsided market structure today.

14

15

15 RKBK Automobiles Ltd ORGANISATION STRUCTUR General Manager Mr.S.K.Thompson Team Leader-1 Team Leader-2 Mr.Santosh Singh Mr.Sujeet
15 RKBK Automobiles Ltd ORGANISATION STRUCTUR General Manager Mr.S.K.Thompson Team Leader-1 Team Leader-2 Mr.Santosh Singh Mr.Sujeet

RKBK Automobiles Ltd

ORGANISATION STRUCTUR

General Manager Mr.S.K.Thompson

Team Leader-1

Team Leader-2

Mr.Santosh Singh

Mr.Sujeet Singh

Sales executive (se) [4 sales executive under 1 team leader]

Managing Director Mr.B.K.Poddar

 
Managing Director Mr.B.K.Poddar Director & CEO Mr. K.P.Poddar

Director & CEO Mr. K.P.Poddar

 

Human Resourse Manager

   
           

Manager

Mr.Sanjay Pathak Customer

 

Accounting

True

Manager

Spares

Care

Value

sales

Manager

Workshop

Manager

 

WORKSHOP MANAGER Mr.Nasir Ali Khan

   
 

Service

Pre-

Service Pre- Customer

Customer

 

Advisor/

delivery

Accidental

Manager

Back Office

Inspection

Unit

Supervisor

(PDI)

Mr.C.Moitra

Mechanic

 
Mechanic Jr.Mechanic Electrician

Jr.Mechanic

 
 
Mechanic Jr.Mechanic Electrician

Electrician

 
Mechanic Jr.Mechanic Electrician
Mechanic
Mechanic

Denter/Painter

Customer Manager Care
Customer
Manager
Care

16

 
Evaluater’s Sales Back Office Executive Staff Executive

Evaluater’s

Sales

Back Office

Executive

Staff

Executive

 
Evaluater’s Sales Back Office Executive Staff Executive

TRUE VALUE MANAGER Mr.R.K.Tiwari

 

Sr.Manager A/c Mr.K.N.Ojha

A/C Manager

 

A/C Department

A/C Department

Executive A/C Manager

Duties and Responsibilities of the Staff in RKBK.

Evaluater’s Sales Back Office Executive Staff Executive TRUE VALUE MANAGER Mr.R.K.Tiwari Sr.Manager A/c Mr.K.N.Ojha A/C Manager

17

The duties and responsibilities of the staff of the dealer RKBK Automobiles

To provide all the facilities and services to the customers which are

To create healthy environment in the organisation.

To co-oporate with each other in the organisation.

To maintain good relation with the customers.

To complete the target of selling cars of dealer .

given by Maruti Company to their customer.

To maintain all the a/c with honesty.

To be in the office at right time.

To sale maximum vehcles .

True Value

ltd is

18

19

Ltd”.

cycle.

Complete peace of mind

Professionally trained manpower

All car related services under one roof

300 outlets in 178 cities and growing

Maruti True Value business expands the family of Maruti customers,

satisfaction by continuous association during the vehicle ownership life

No one know your Maruti car better than Maruti- based on this premise,

is venture of india’s largest automobiles manufacture “Maruti Suzuki India

and further emphasizes Maruti’s Commitment towards enhancing customer

providing reassurance to exsting Maruti customers about resale of their cars

Maruti Trye Value is India No.1 organised pre-owned car brand. True Value

Unique advantages India’s largest certified used car dealer network

19 Ltd”. cycle. ∑ Complete peace of mind ∑ Professionally trained manpower ∑ All car related

As a mark of confidence, and to provide reassurance to customers, every

are transparend and fair. Through that, the company endeavors to extend the

Value processes and systems ensure that the seller gets the right price and is

Value category cars bought by Maruti True Value dealers are taken to state-

Maruti chanalises its expertise to ensure that transactions in pre owned cars

Value car in exchange or a brand new Maruti Suzuki car in exchange.True

True Value has transparend and fair evaluation process, which is currently

missing in the largely unorganized market for pre-owned cars. Maruti true

Maruti Genuine Parts and by skilled technicians. These cars are then sold

Services. Convenient finance options are also offered to buyers of Maruti

20

Maruti Engineers and the car carries a one- year warranty and three free

Under True Value, the seller has option to be paid in cash, or get a True

True value category cars are refurbished in state of art workshops using

Vehicle bought under Maruti True Value is inspected and certified by

relationship and emotional connect that it enjoys with the customer.

through Maruti true Value outlets.

of- the-art workshops.

paid promptly.

True Value cars.

Under the Maruti True Value service, Maruti cars which are less than four

both first-time car buyer and those who are looking to upgrade themselves to

The launch of new service, for which MUL has tied –up with a select set of

customer by offering a range of cars, resale and financing options all under

‘Project Vistaar’, Maruti Udyog Ltd (MUL) is now rolling out its used- car

dealers, will begin in Maruti True Value outlets in Banalore on Oct 19 and

two previous ownerships will be accepted for purchase from the customer.

AFTER launching its fleet management service under the Umbrella brand

years old or ones which have done up to 60,000 km and have not changed

name’Maruti True Value’ and is aimed at catering to customers who are

21

later, in Delhi from Oct 22 onwards. It will then be extended to the rest of

The pre-owned cars business is being introduced under the sub-brand

a passenger car in a higher segment. MUL is also hoping to retain its

Then, designated engineers from Maruti who will be present at

business countryide in a phased manner.

Maruti’s ‘True Value’ for used cars

the country, company sources said.

one roof.

Consequently, the seller will have the option to be paid in cash, or get

checked for any irregularities. MUL has trained it’s staff at the select dealer

For the buyer of a second hand car, MUL is going a step further in offering

Again ,Finance options are begin offered for the True Value car, which will

The engineers at the True value counter are expected to adopt a transparent

outlet will also offer finance options to the customers, to enable the second

a one- year warranty and three free services along with the refurbished car.

and fair evolution process to ensure that the seller gets the right price. The

another True Value car in exchange or even a new Maruti car in exchange.

the True Value outlets will conduct a standard 120- point check of the

22

Using Maruti Genuine parts, techniciana at the True Value outlet will

vehicle brought to the outlet. The documents of the seller will also be

be certified by the company after allowing the potential buyer an

After this, the purchased used car is readied for refurbishment.

-hand car seller to purchase a new car of his choice.

refurbish the car, which will then be offered for sale.

outlets to handle its pre –owned cars business.

opportunity to personally evaluate the car.

and usually two-wheeler owners looking for upgrading their status go for

02 December, 2008 Maruti Suzuki has recorded a growth in its used car business inspite of

Recently, Maruti has made a new offering to India with the launch of Maruti

Suzuki A-star in the A2 segment, a car that is targeted towards urban young

Ravi Bhatia, Chief General Sales Manager, Maruti Suzuki stated, “The low

According to Bhatia, Maruti holds majority of the shares in the robust used

the Rs 1 Lakh priced cars, used ones are available for Rs 60,000-Rs 80,000

there is an altogether different set of buyers vying for this segment. Unlike

priced cars like Nano will not have any impact on used cars business since

23

slowdown in the car market. The company denies the impact of low-cost

car market in India. He also states that business with True Value is quite

cars like Tata Nano on its True Value and expects a growth by 30%.

robust and expects to climb a growth scale.

Maruti's True Value on Growth Scale

used cars.”

consumers.

(ii)

Evolve as an institution that serves the best interest of all stakeholders.

(iii)

Pursue excellence through total quality management.

(iv)

Ensures the highest standards of ethics and integrity in all our action.

  • (i) Provide superior products and services to our customers and maintain

The leader in Indian automobiles industry creating customer delight and

shareholder’s wealth; a pride of India.

VISSION & MISSION

market leadership.

Our Vision:

Mission

24

25

last seven years.

Rs.18.77 in 2004-05.

PERFORMANCE

useful to begin with three.

operational efficiencies, has translated into much higher returns on investment.

growth of 25.8 per cent over 2003-04. It is the highest top-line growth in the

Earnings per share (EPS) more than trebled from Rs.5.14 in 2003-04 to

its highest ever sales of over 4.72 lack vehicles in the domestic & export

markets which resulted in gross sales revenue of Rs.112,840 million — a

growth momentum. There have been several developments, of which it is

In more ways than one, the year 2004-05 was a watershed year for Maruti

First, driven by renewed vigor and aggression in the market, Maruti recorded

Second, this high sales growth, coupled with significant improvements in

Udyog Limited (MUL). The company has consolidated and initiated a new

Third, the Government of India divested a majority of its shares through an

disposable income which, coupled with much easier availability of

in increasing revenue. This is the highest GDP increase recorded by India

economies of the world .This has considerably increased per capita

Historically, the fortunes of automobile industries across the globe are

2003-04 to 8.2 per cent in 2004-05 — has definitely assisted your company

The sharp revival in the Indian economy — from 4 per cent GDP growth in

since the advent of economic liberalization, and the country has become one

strongly correlated with macro-economic parameters and the performance

26

In a nutshell, therefore, 2004-05 marks the beginning of a new journey for

your company, as it restructured itself in the face of stiff competition and

initial public offer(IPO) and made way for greater participation from you —

the shareholders – in the fortunes of India’s leading passenger car manufacturer.

significantly cheaper consumer finance, has driven automobile sales.

entered a new high growth phase.

of the fastest growing

first company that aspired to sell 100,000 cars a year. The aspiration of being

Improved operational efficiencies, which are largely due to the transfer of

the market leader with high sales volume continues to be intrinsic to your

multi-utility vehicles market finally reached efficient scales of nearly a

million. Although the improved economic environment helped growing

of the industrial sector. Chart A plots growth in GDP, industry, passenger

company’s philosophy. This belief has held the company in good stead

automobile sales, it was not a totally smooth drive for the Indian

emphasizes this correlation. In 2004-05, the Indian passenger car and

Maruti has always believed in size and spread. When the Indian automobile

27

during 2004-05 — where the strategy of pushing volume growth resulted in

industry was reconciled to around 40,000 cars in early 1980’s, MUL was the

vehicle (PV) sales volumes and total automobile sales volumes – and

automobile industry. An increase in the number of players and models has

resulted in fierce competition — driving down prices across all segments.

The industry also witnessed significant rise in prices of key raw materials

technology, systems and work culture from MUL’s majority shareholder.

higher margins due to the positive effects of better capacity utilization.

like steel, rubber and plastics. Thus, profit margins were under pressure.

returns on investments. In 2004-05, the company has had record growth in

was originally set up as a joint venture between the Government of India

MUL also witnessed a key structural change during 2004-05. The company

initial growth of the Indian automobile industry to becoming one of India’s

car. Today, 20 years hence, MUL has come a long way from charting the

(GOI) and SMC to provide the average Indian with a reliable and affordable

Earnings per share (EPS) increased from Rs.5.14 in 2003-04 to Rs.18.77 in

Return on average capital employed (ROCE) increased from 9.9 per cent in

Net profit margin (PAT/total income) increased from 2 per cent in 2003-04

Return on average net worth (RONW) increased from 5.2 per cent in 2003-04

28

Suzuki Motor Corporation (SMC) — has also contributed to the improved

bottom-line and return on investments. Here are some numbers.

2004-05, while cash EPS increased from Rs.17.79 in

2003-04 to 22.3 per cent in 2004-05.

leading business organizations

to 16.5 per cent in 2004-05.

to 5.6 per cent in 2004-05.

2003-04 to Rs.38.39 in 2004-05.

Stock Exchange & National Stock Exchange) with Suzuki Motor Corporation

having 54.2 per cent share ownership. Today, GOI owns 18.3 per cent of

hours of its opening. In fact, it was over subscribed nearly 10 times at the

operations and financials of Maruti during 2004-05, and analyze the rapid

MUL is a company which is constantly reinventing itself in a sector that is on

Thus, MUL is now a listed company in Indian stock exchanges (Bombay

with vendors. GOI played a key role in supporting Maruti’s growth. In 2004-

markets is based on figures released by Society of Indian Automobile

share capital, for sale to the public through the book-building route. Even in

green-shoe option, and offloaded an additional 10 per cent of the issue size

external and internal transformations in its business. All data pertaining to

29

a somewhat bearish stock market, the issue was fully subscribed within three

floor price. Encouraged by the overwhelming response, GOI exercised the

the move. In the course of the following sections, we shall discuss markets,

GOI offered 72,243,300 equity shares, which is 25 per cent of the company’s

-which has also promoted overall industrial growth through its linkages

05, GOI divested a bulk of its shares in the company to the public.

MUL’s ordinary shares, while 27.5 per cent is in public hands.

(equivalent to 7,224,300 equity shares).

Manufacturers (SIAM).

What factors influence consumer purchases?

Consumer Buying Behavior refers to the buying behavior of the ultimate

Buyers' reactions to a firms marketing strategy has a great impact on

Marketers can better predict how consumers will respond to

The marketing concept stresses that a firm should create a marketing

Buying Behavior is the decision processes and acts of people involved in

mix(MM) that satisfies (gives utility to) customers, therefore need to

Why consumers make the purchases that they make?

analyze the what, where, when and how consumers buy.

consumer. A firm needs to analyze buying behavior for:

30

The changing factors in our society.

What is Consumer Buying Behavior?

Definition of Buying Behavior,

buying and using products.

Need to understand:

marketing strategies.

INTRODUCTION

the firm's success.

A successful information search leaves a buyer with possible alternatives.

1. Problem Recognition (awareness of need)--difference between the

include all 6 stages, determined by the de2ree of complexity discussed ...

decisions). Actual purchasing is only one stage of the process. Not all

decision processes lead to a purchase. All consumer decisions do not always

Six Stages to the Consumer Buying Decision Process (For complex

External search if you need more information. Friends and relatives

a commercial for a new pair of shoes, stimulates your recognition that you

Can be stimulated by the marketer through product information— i.e, see

desired state and the actual condition. Deficit in assortment of products.

31

(word of mouth). Marketer dominated sources; comparison shopping;

Stages of the Consumer Buying Process

Internal search, memory.

need a new pair of shoes.

2. Information search-

The 6 stages are :

public sources etc.

next.

Cognitive Dissonance, have you made the right decision. This can be

  • 3. Evaluation of Alternatives you need to establish criteria for

  • 4. Purchase decision-Choose buying alternative, includes product,

package, store, method of purchase etc. Purchase May differs from

Level of Involvement in purchase decision. Importance and intensity

evaluation features the buyer wants or does not want. Rank/weight

Information from different sources may be treated differently. Marketers

alternatives or resume search. May decide that you want to eat something

Can you think of another alternative? Look in the yellow pages etc.

spicy. If not satisfied with your choices then return to the search phase.

32

5.Post-PurchaseEvaluation--Outcome Satisfaction or Dissatisfaction.

decision, time lapse between 4 & 5, product availability.

Types of consumer buying behavior are determined by:

reduced by warranties, after sales communication etc.

Types of Consumer Buying Behavior

of interest in a product in a particular situation.

try to influence by "framing" alternatives.

information gathering. Examples include Clothes know product class

products visible to others, and the higher the risk the higher the involvement.

High involvement purchases--Honda Motorbike, high priced goods,

Limited Decision Making buying product occasionally. When you

Routine Response Programmed Behavior -- buying low involvement

Buyer's level of involvement determines why he/she is motivated to

product category, perhaps. Requires a moderate amount of time for

frequently purchased low cost items; need very little search and

decision effort; purchased almost automatically. Examples include

seek information about a certain products and brands but virtually

33

The four type of consumer buying behavior are:

need to obtain information about unfamiliar brand in a familiar

soft drinks, snack foods, milk etc.

ignores others.

Economic risk

Types of risk:

but not the brand.

Personal risk

Social risk

Extensive Decision Making/Complex high involvement, unfamiliar,

expensive and/or infrequently bought products. High degree of

relatives, store personnel etc. Go through all six stages of the buying

In order to produce successful ads, you must give people exactly what

they want. This article will teach you why people buy the things they

and deciding. Information from the companies MM; friends and

homes, computers, education. Spend a lot of time seeking information

economic/performance/psychological risk. Examples include cars,

do so you can design your ads to fulfill these needs.

Impulse buying, no conscious planning.

process.

34

35

MODEL OF BUYING BEHAVIOR

Problems recognition Information search Evaluation of alternatives Purchase decision Post purchase decision

Buyer’s decision process

Product choice Brand choice Dealer choice Purchase timings Purchase amount

[3 rdse under 1 sales executive]

Rural development (rdse)

Other Stimuli

Economy

Political

Cultural

Technological

 

Buyer’s

Characteristic

Cultural

Social

Personal

Psychological

Marketing Promotion Product Stimuli Place Price
Marketing
Promotion
Product
Stimuli
Place
Price
Evaluation of STAGES OF CONSUMER BUYING PROCESS Problem recognition Information search
Evaluation of STAGES OF CONSUMER BUYING PROCESS Problem recognition Information search

Evaluation of

STAGES OF CONSUMER BUYING PROCESS

Problem recognition
Problem
recognition
Information search
Information
search
Evaluation of STAGES OF CONSUMER BUYING PROCESS Problem recognition Information search alternatives Purchase decisions behaviour
Evaluation of STAGES OF CONSUMER BUYING PROCESS Problem recognition Information search alternatives Purchase decisions behaviour
Evaluation of STAGES OF CONSUMER BUYING PROCESS Problem recognition Information search alternatives Purchase decisions behaviour
Evaluation of STAGES OF CONSUMER BUYING PROCESS Problem recognition Information search alternatives Purchase decisions behaviour
alternatives Purchase decisions behaviour
alternatives
Purchase
decisions
behaviour

Post purchase

36

High involvement

Complex buying

behaviour

Low involvement

Variety-seeking buying behaviour

Dissonance-reducing buying behaviour

CONSUMER BUYING BEHAVIOR

between brands Few differences
between brands
Few differences
brands differences between Significant
brands
differences
between
Significant
behaviour Habitual buying
behaviour
Habitual buying
Maruti 800 has topped every fuel efficiency survey that has been conducted petrol car in the

Maruti 800 has topped every fuel efficiency survey that has been conducted

petrol car in the country with a cost of Rs1.94 per kilometer.This confirms

Great technology enables the Maruti 800 to deliver great fuel efficiency. The

in the past. The Maruti 800 has the lowest fuel cost per kilometer of any

country and Maruti also launched their LPG model which is more economic

the position of the Maruti 800 as the most fuel efficient petrol car in the

PRODUCTS & SERVICES

MARUTI 800

ECONOMY

than others.

37

The multi-point fuel injected engine helps to lower emissions and achieve kgm @ 3000 rpm ensures

The multi-point fuel injected engine helps to lower emissions and achieve

kgm @ 3000 rpm ensures better climbing power and lesser gear changes. In

With 37 bhp @ 5000 rpm, you have greater pulling power. A torque of 6.32

This car position itself in the mind of consumer as a family car. The punch

line of the car is “total solution of the entire family”

greater fuel efficiency.

MARUTI OMNI

FOR THE FAMILY

Features are:

MPFI Engine

38

Reclining front seats with adjustable head restraints let you relax

anything. Pack in your family, your group of friends, your luggage, your

headroom and legroom make long rides comfortable and enjoyable.

completely. With its ample luggage space, the Omni is equipped for

Stretch out. Open up. Enjoy the luxury of space inside the Omni. The ample

The MPFI engine also meets all the stringent Euro II emission norms

golfing gear, your picnic hamper…all can fit in snugly.

other words, less fatigue.

SPACE

39

40

MPFI ENGINE

Features are:

RELIABILITY

introduction in India!

MARUTI ALTO

other vehicles in its class.

power with optimal fuel efficiency

Here's another first by ALTO, which has been setting records since its

and a 16-bit on-board computer allows the Alto to effectively combine

choice for Indian roads. The fuel efficiency of the Alto is better than any

Plenty of power, great mileage and low emission make the Alto the perfect

fun. The 4-valves per cylinder MPFI engine mated with a 5-speed gearshift

The 16x4 hypertech MPFI engine delivers unadulterated power, begging for

40 MPFI ENGINE Features are: RELIABILITY introduction in India! MARUTI ALTO other vehicles in its class.
rear seats allow you to stretch yourself during long drives. This ensures that Alto becomes the

rear seats allow you to stretch yourself during long drives. This ensures that

Alto becomes the first Indian car to undergo a 24 hours endurance test and

push driving comfort to the max. Full flat folding front seats and reclining

The smarter race knows exactly how to take the stress out of driving and

The McPherson strut suspension in the front and coil springs at the rear

you travel in maximum comfort as compared to cramped seating

sets 13 national records in the process.

arrangements in other cars.

Wagon R

COMFORT

41

zone shields you in the unlikely event

ensures a smooth comfortable drive. It's not just comfort; Wagon R also has

And the Wagon R is designed to satisfy every concern. Just check out the

platform. Caution, safety and protection are integral to a smarter mindset.

Wagon R. Tall body, high seats and wide opening doors make it easy to

get in and get out. Seven cm taller than the Santro, the Wagon R offers

Nothing cramps the style of the smarter race. That’s why it prefers the

The Wagon R comes with an extra large boot space, which is possible

position. The split rear seating arrangement along with fully reclining

Dual side-impact beams in the front and rear doors protect you from

more headroom, amazing spaciousness and a commanding driving

because of its unique design that maximizes space on a compact

front and the reclining rear seats gives a first

a

a 1061cc MPFI low friction engine

battery of safety features:

class airline seating

A long crumple

lateral collisions.

SPACE

collision.

comfort.

frontal

of

42

A Roll Control device in the front suspension imparts greater stability inch booster-assisted brakes equip you

A Roll Control device in the front suspension imparts greater stability

inch booster-assisted brakes equip you well to handle any emergency

in all 4 doors protect the passengers from side crashes. Front impact

High seating position gives you a bigger field of view, allowing you to

guard your loved ones from road disasters. Side impact absorbing beams

The Versa is one of the safest cars on the road. It has safety features to

and helps the Wagon R to negotiate sharp curves at high speeds. The 8

better anticipate traffic problems before they occur.

ONE GREAT DRIVE. TWICE THE SAFETY

MARUTI VERSA

43

* Except for the folding seat in 2nd row (DX, DX2) and last row seats.

beams between the front pillars and the collapsible steering column

during sudden stoppages. Height adjustable head restraints, brake

A steel pipe frame in the rear seat safeguards your family from rear

impacts.ELR seat belts allow free movement, but hold you securely

can be slid forward or backward independently to suit the convenience of

boosters and a collapsible steering column further ensure your safety.

protecting the driver from engine heat. The rear seat also has a steel pipe

and the engine. Two layers of PUF and aluminium sheets act as a buffer,

The high seat position makes it easy to get in and out and gives superior

44

long rides. All seats* have recliners. In SDX, the 2nd row bucket seats

Versa's the ideal car for long journeys. Now stretch your legs on those

road visibility. The front row seats have thick insulation between seat

When you step out of the house and into your Versa, rest assured

frame for protection in the event of a rear impact.

Sink in. Stretch out. Lie back. Indulge

shield you from head on collisions.

the passengers.

∑ Diaphragm Spring Clutch designed to with stand higher rotational ∑ Higher ground clearance of 210

Diaphragm Spring Clutch designed to with stand higher rotational

Higher ground clearance of 210 mm to ensure better off-road

speeds requiring less release load ,thereby reducing the wear of parts

MARUTI GYPSY

Gypsy Advantage

handling.

HILLS

45

power and greater responsiveness.

The Engine that’s high on thermal conductivity, and heats up quickly

The Engine avoids overheating because its high thermal conductivity

A higher power to weight ratio of 0.0812 ensures faster acceleration

Maximum power of 80 bhp @ 6000 rpm makes for easier crossings.

1300 cc petrol engine — lighter than a diesel engine, resulting in a

4-Wheel drive for better control and more power at the wheel.

even under extremely cold conditions. Thus, there are no starting

higher power to weight ratio. This ensures better control, more

problems even in the midst of snow.

46

and muddy terrain.

DIRT TRACKS

enables it to give

through streams

off heat much faster

STREAMS

DESERT

SNOW

The time has come for a new kind of compact car, one that's based on a

The time has come for a new kind of compact car, one that's based on a fresh approach to design and development, delivers the kind of driver and

The Gypsy is a lighter vehicle weighing in at 1020 kg (hard top) and

Steering Damper ensures that shocks encountered from bumps and

985 kg (soft top). This is a major advantage on sandy or muddy tracts

potholes are not passed on to the steering wheel. Thus, any loss of

— a heavier vehicle will get stuck but the Gypsy keeps

control owing to unexpected obstacles is avoided.

DIRT TRACKS

SWIFT

47

is intended to "redefine the market and stir excitement in the entry level sedan segment". It's

is intended to "redefine the market and stir excitement in the entry level sedan segment". It's a good news for the consumers because Swift DZire, which comes both in diesel and petrol engines, offers luxury feature options

The time has come for the Maruti Suzuki Swift. The Swift is more eye- catching, more spacious, more refined, more user-friendly, and a whole lot more enjoyable to drive than anything else in the compact-car category.

passenger experience that places it in a class of its own and has true worldwide appeal.

The new Swift DZire joined the Swift and SX4 in Suzuki's Indian lineup and

SWIFT DZIRE

Maruti Swift DZire

48

Arctic White Silky Silver Clear Beige Midnight Black Bright Red Azure Gray Sovereign Blue Features Launched as a replacement of the earlier mid size sedan Maruti Esteem, the Swift DZire is sophisticated in look and features. There is a long list of features of Swift DZire which includes:

including integrated stereo, steering mounted audio controls, automatic climate control and power windows as well. Not only this but, it is also equipped with latests safety features like Dual Airbags, ABS with EDB, collapsible steering column and an i-CATS anti-theft facility. It's true to say that many of these features are being offered for the first time in this segment in contemporary car market in India. Variants PetrolDiesel LXI LDI VXI VDI ZXI ZDI

There is a wide range of colors for the customers. The newly Swift DZire is offered in seven colours:

RANGE OF COLOURS

49

There is a chiseled shoulder line to complement muscular flared wheel arches and sills. Rich chrome styling for an imposing grille and an impressive rear is also there now. Stylish wraparound tail lamps fitted. Powerful clear lens headlamps for superior night visibility is and additional benefit for you. Headlight leveling allows you perfect light beam adjustment while driving. A high mounted stop lamp and a rear bumper-integrated fog lamp give clear signals to following traffic, thus avoiding accidents. Comfort & Convenience Indulge your desire of complete comfort:

Whenever you need to choose you temperature, just choose the temperature you desire and the on-board computers is there to auto-adjust to the weather outside, maintaining precise cabin temperature.

Swift DZire is equipped with a classy dashboard integrated audio system with remote control along with powerful speaker.

Makes Heads Turn with its desirable exteriors:

Automatic Climate Control (ACC):

Steering Mounted Audio Controls:

EXTERIORS

INTERIORS

50

All around power windows for improved convenience to the drivers is there now. Sounds absorbing materials and vibration dampers for a smooth and pleasurable drive. Now, there is height adjustable drivers seat for personalized driving position. A tilt adjustable steering column lets you to set it just right for your height, so you enjoy a comfortable drive and enjoy the ride even for long distance. Improved comfort in the back row for those who don't drive but enjoy the ride. Variants

All around power windows for improved convenience to the drivers is there now. Sounds absorbing materials

Maruti Suzuki SX4

MARUTI SX4

51

.. Suzuki SX4, a joint venture made by two of automobile czars, Suzuki and Maruti. The model closely follows the Swift platform, therefore, it is easily available with exclusive features which makes it all the more desirable among car connoisseurs. A mini SUV (sport utility vehicles) style, SX4 is almost like a car in it's construction & comfort context. The model is found in two- and four- wheel drive. With two variants, the model is all set to conquer the Indian auto biz market. These are commonly referred as the "Urban Line" & the "Outdoor Line", where the latter is more like an SUV in appearance compared to the first one. The car is expected to have 1590cc petrol engine making it capable enough to deliver a power of 94bhp and a torque of 13.4kgm.

ABS EBD Dual SRS airbags Front and rear side doors having impact beams Seat belt pre-tensioners Force limiters Car immobilizer Anti theft device Switchable three-mode 4x4 system for :

Maruti Suzuki SX4 is assorted with elegant features which makes the model worth possessing. These are :

is out with it's cutting edge new model, Maruti

Maruti Suzuki India Ltd

OTHER FEATURES

2WD

52

4WD Auto mode 4WD Lock mode Colors Grand vitara is anew segment entered by maruti. Initially

4WD Auto mode 4WD Lock mode Colors

Grand vitara is anew segment entered by maruti. Initially they are just in

traditional cars business Grand vitara is a SUV (sports utility vehicle) with a

powerful engine of 2600 cc. It is fitted with a MPFI diesel engine. It delivers

Colors for Maruti Suzuki SX4 are quite unique & contemporary in nature

GRAND VITARA

4x4 drive.

53

Price charged

Price charged respond with a brand new vehicle for the Indian market. Engineers from newly-launched A-Star.

respond with a brand new vehicle for the Indian market. Engineers from

newly-launched A-Star. Hundai has already launched their i10 model in the

Maruti Ritz is the perhaps the most awaited and hyped car from Maruti

includes its compact offering such as Alto, WagnoR, Swift, Zen and the

Suzuki. The car is positioned in the premium A2 market segment, which

Indian market. Now, it’s the turn of market leaders maruti Suzuki to

Maruti Ritz Review

premium segment.

MARUTI RITZ

is

for grand

vitara is

between

lakh. It

lakh

13.5

of

16

54

to

are being offered for the first time in this segment in contemporary car

Ritz launched in the Indian markets on 15 th May,2009, the Ritz Maruti is one

going the complete distance to insure that the Ritz manages to make an

manages to complete with its counterparts is yet to be seen in the time to

Maruti Suzuki worked at close quarters with their Japanese counterparts in

impact on the cut-throat A-2 hatchback space. How far the new Ritz

the development of the Ritz, much like that for the A-Star.MUL seems to be

say segment in contemporary car market in India.that many of these features

of the first BS-IV complaint cars of India. Priced at Rs 4 Lakh to Rs.5 Lakh,

the Ritz Maruti has a sporty new look with cool spacy interiors. It's true to

55

Mruti Ritz VXi ABS

Mruti Ritz VDi ABS

market in India.

Mruti Ritz VDi

Mruti Ritz VXi

Mruti Ritz LXi

Mruti Ritz ZXi

Mruti Ritz LDi

come.

56

Features

DOMESTIC

categories:

MARKETS

1. Passenger cars

Alloy wheels

Engine immobilizer(iCATS)

Steering-mounted audio controls

a 27.4 per cent increase from 707,198 units sold in 2003-04.

Driver seat / Steering wheel / Seatbelt height adjustor

emphasis on passenger cars. During 2004-05, the Indian passenger vehicles

The passenger vehicle market is divided broadly into the following three

Maruti primarily operates in the passenger vehicles market with an

market finally attained critical mass with sales volume of 900,752 units —

Front seat under tray

60:40 rear split seats

Indian passenger vehicles market and grew by 28.6 per cent from 541,491

A2: Compac

— from 3,401 mm to 4, 000 mm.

A3: Mid-size

from 4,001 mm to 4,500 mm.

Within these categories, MUL’s presence in order of prominence and in

market growth, but also managed to overcome intense competition and gain

passenger vehicles sales, where passenger car sales have been broken up

market leader. During 2004-05, not only did Maruti grow due to the overall

In volume terms, passenger car sales accounted for over 77 per cent of the

volume term is in passenger cars, MPVs or the C segment and UVs or the B

segment. Chart B gives the relative share of each segment in Maruti’s

market share — which increased from 50.8 per cent in 2003-04 to 51.4 per

57

The Indian car market is classified into six categories based on the

units in 2003-04 to 696,207 units in 2004-05. Maruti continues to be the

2. Multi-purpose vehicles (MPVs) and 3. Utility vehicles (UVs)

according to the SIAM based classification (A1-A6).

1: Mini — up to 3,400 mm.

PASSENGERS CAR

vehicle length

cent in 2004-05.

greater reach in distribution, and MUL is undertaking many efforts in this

new models. Things have fundamentally changed in 2004-05. Through a

well-crafted strategy, Maruti consolidated its leadership position in the A2

A2 CATEGORY: Maruti has three models in this category — Zen, Alto

volume grew by 46 per cent. Consequently, the company’s market share has

and Wagon R. This is the segment where the company faced stiff competition

in the last few years, and had lost some ground due to delays in launching

category. While the category grew by 23.4 per cent in 2004-05, MUL’s sales

A6: Luxury — 5,001 mm and above. MUL has presence in three of these cate-

gories namely A1, A2 and A3. Chart C plots MUL’s sales volumes in these three

A1 CATEGORY: With its Maruti 800, your company is the only player in

58

and consumers buying their second car. Penetrating this market requires

this category. Sales volumes increased by 16.9 per cent during 2004-05.

Growth in this economy segment comes mainly from first-time buyers,

increased from 40.3 per cent in 2003-04 to 47.7 per cent in 2004-05.

A5: Premium — from 4,701 to 5,000 mm.

categories for 2004-05 and 2003-04.

4,501 mm to 4,700 mm.

A4: Executive —

direction.

wheelers, especially in the higher end segment, should shift to cars in the A1

penetration, the A1 and A2 segments will continue to register strong growth

We believe that given India’s income distribution and low levels of car

roads is over 50 million. With cheaper credit facilities, many users of two-

as the population increases its levels of motorization. Today, India is the

second largest two-wheeler market in world with sales of around 5 million

two wheelers during 2004-05. The existing stock of two wheelers on India’s

tap this huge growth opportunity. To penetrate deeper into the Indian market,

category. MUL is the dominant company in India, which has the models to

the widest branch network in India, and we expect to reach parts of the rural

MUL has tied up with the State Bank of India (SBI) to finance cars. SBI has

59

Apart from strengthening the distribution network, key initiatives that

Strengthening the brand image of the three models through

Repositioning Alto in a niche space between A1 and A2 cars. Aggressive

pricing of the Alto was supplemented by a strong ad campaign that targeted

the younger generation. These factors played a role in boosting the

markets hitherto uncovered by retail finance availability.

advertisements and sales promotional initiatives.

drove this growth during 2004-05 include:

volume of Alto sales by over 125 per cent.

models, and no single player has major leadership position. MUL’s two

A3 CATEGORY: This is a highly fragmented category with several

around 30 per cent, against the overall category’s growth of 50.8 per cent. In

over 10 per cent. Maruti lost some market share as its volume sales grew by

prices of SX4 downwards and launched a new version — the SX4Lxi. We

the last quarter of 2004-05, to increase market penetration, MUL revised the

which rejuvenated the brand in the market. There were also

significant changes in the Wagon R, which contributed to a

New variant of the Zen was launched in the latter half of 2003,

models —Swift Desire& SX4— have a combined market share of a little

have already started witnessing results from this initiative.

volume growth of 59 per cent.

60

Launched its state-of-the-art sports utility vehicle (SUV) — the Grand

segment. Maruti marginally increased its share in this segment with about

55.2 per cent in volume terms during 2004-05. Segment with a market

Passenger cars and MPVs are generally analyzed as a comprehensive

share of only 2.5 per cent. The primary model in this segment is the

During the latter half of the year, Maruti launched an economy model of

the Versa. A new Omni variant, which runs on LPG was launched to tap

Maruti is the dominant player with nearly 100% market share. In 2004-05,

In this segment, Maruti’s models include the Omni and the Versa. Here,

61

MULTI-PURPOSE VEHICLES (MPVS)

the company’s sales volumes grew by 14.7 per cent.

Gypsy. During April 2003 , the company

Passenger Cars + MPV Market

newer cargo markets.

Customer Orientation

Vitara.

It is important to note that the rating, which was between 10 and 20 per cent

improving customer satisfaction is the top ranking given to the Wagon R

is integral to the company’s planning process. A tribute to its efforts at

in 2000, has increased to above 50 per cent in 2003. Another interesting

in the premium compact segment, and Esteem in the entry midsize

The growth in sales volumes is a consequence of Maruti’s continuous

segment, by JD Power’s survey on IQS. Table 1 gives a snapshot of five

stress on customer focus. Regular interface and feedback from customers

top reasons why people buy Maruti cars as per the JD Power survey.

point is that while Maruti’s

62

“good technology” became one of the five leading reasons cited by

This high level of customer satisfaction and award of number 1 position in

which actively reaches out to potential customers. The company has

customer satisfaction by world renowned J D Power survey for four times in

a row can be translated into sales only through a strong dealer network,

and has a service network of more than 1900 workshops spread across 1000

extended its dealership network to 280 sales outlets, spread over 182 cities,

Diesel vehicles dominate this segment with a share of around 95 per

player in the MUV economy factor was the most important reason for

purchase in 2000, the company’s reputation has become the leading factor

63

managed to build a strong brand image in the last four years. MUL’s

cent. This is mainly because vehicles in this segment are by nature

determining the customer’s purchase decision in 2003. Thus, Maruti has

heavy and diesel has a policy determined price advantage over petrol.

technological capabilities are getting greater recognition as in 2003:

Since Maruti does not have a diesel vehicle today, it remains a small

UTILITY VEHICLES (UVS)

customers for buying a Maruti car.

Dealership and Service Network

showrooms. On the same lines, 59 new workshops were opened by 51

Apart from having a good product, the key factor in developing a good

which meets all the requirements during the life cycle of a car. This not

the fact that 28 existing dealers made large investments and opened new

with the opportunity to generate greater profits. Other services that have

cities. The confidence of the dealer community in Maruti is spelled out by

selling a car is only the beginning of a long-term relationship with the car

buyer. During the course of a car’s life, there are many services and products

MUL offers its customers a suite of products through its authorized dealers,

only meets a much larger basket of customer needs but also provides dealers

dealer network is to assure profits for the dealers. Maruti believes that

64

buyer. It is imperative to have a robust dealer network to push sales to the

customers. In the last three years, Maruti has worked hard to revitalize and

The automobile industry has two levels of customers — the dealer and the

which can be offered to the customer like finance, accessories, insurance,

final customer. Therefore, MUL treats its dealers as its first level of

service, spare parts and finally trade-in resale opportunities.

been launched under new business initiatives of Maruti include Maruti

strengthen its dealership network.

existing dealers.

A key initiative to promote best practices on the dealer front has been the

The company acknowledges that superior customers experience is only

possible if the dealers’ employees are adequately trained. To achieve this,

among Suzuki distributors in South-East Asia; and now, an Indian team will

Maruti plays the role of an aggregator and brand manager. None of the risks

We are proud to state that Maruti’s dealer’s technicians were ranked the best

Finance (a consortium of finance companies), Maruti Insurance and the pre -

business model and their strong motivation has resulted in record top-line

Most dealers have understood the importance and profitability of this new

65

practice of the balanced scorecard to evaluate dealers. Those dealers who

achieve or exceed a certain score are financially rewarded for their efforts.

owned cars business under the True Value brand name. In all these businesses,

participate in the International Technical Skill Competition in Japan.

training is undertaken in all areas of dealership operations.

related to these businesses are booked in the books of MUL.

growth for 2004-05.

over 50,000 vehicles. It exported 51,175 units. Maruti’s export growth has

years’ export history. It is also the first year in which the company exported

been driven primarily by 56.8 per cent increase in exports of Maruti 800, and

Your company remains steadfast in its quest for achieving higher operational

YG4 (Alto) was a huge success in the European market, where 34,399 Suzuki

Algeria, Belgium, Bhutan, Chile, Denmark, Germany, Hungary, Nepal, Sri

value of exports grew by 51.7 per cent from Rs.6,204 million in 200203 to

Altos were sold during 2004-05. The M-800 and the Zen were very well

Qatar) for the first time with the new Alto GCC specifications, specially

efficiencies. This includes efforts at reducing costs, increasing productivity

66

2004-05 was also a landmark year for Maruti in terms of exports. The FOB

Rs.9,410 million in 2004-05 — which is the highest ever in Maruti’s 17

60.5 per cent growth in exports of A2 category cars. Within the A2 category the

accepted in Algeria. We also achieved substantial growth in our exports to

Lanka and UK. Maruti entered the Gulf market (Saudi Arabia, Kuwait and

and maintaining delivery schedules.

designed for this region.

O P E R AT I O N S

EXPORTS

category-wise production of vehicles in 2003-04 and 2004-05. Production

An example of Maruti’s strength in operations is its capability to roll out

two vehicles every minute from its shop floor. It is on the foundation of such

Two years ago, in the backdrop of fierce competition, your company had

helped us remain competitive. Today, as markets have turned upbeat, we

have leveraged this strength to seize opportunities and ensure that profits

initiated a program called ‘Challenge 50 — go fast, high quality’ across its

strong operations that MUL offers its customers a suite of 10 models in over

In times of unfavorable market conditions, our operational efficiencies have

increased across all categories of passenger cars — the A1 category grew by

67

with a combined capability of 500,000 units per annum. Chart D shows the

20.4 per cent, A2 grew by 47.7 per cent and A3 grew by 33.8 per cent. Total

vehicle production increased by 31.4 per cent from 359,960 units in 2003-

Spread over 297 acres, Maruti has three fully integrated production facilities

  • 04 to 472,908 units in 2004-05.

outpace top-line growth.

production facilities.

PRODUCTION

  • 50 variants.

In an industry like automobiles, where large part of its components are

gains for the company. A critical parameter that measures efficiency of

vendor base. This involved providing capital, transplanting technology, and

production systems in the automobile industry is man-hours spent in

producing one vehicle. This has improved by around 54 per cent in the last

three years. In addition, there has been a considerable reduction in inventory

performance benchmarking. 2004-05 is the last year of this program. As

Thus, one of the immediate goals was to develop and establish a competent

holding period, which dropped from 30 days in 2003-04 to 19 days in 2004-

levels by 50 per cent in three years through Kaizen and continuous

outsourced, vendor management becomes a critical operation. This has

shown in Chart E, this program has already yielded impressive operational

always been a key focus area for your company. When MUL started its

operations in India, auto-component suppliers were almost non-existent.

The principal philosophy behind this program is to raise our productivity

developing production processes for suppliers.

SUPPLIER MANAGEMENT

05.

68

our company has been encouraging vendors to develop their own technology and

increasingly finding global recognition for its production capabilities and

low costs. This has considerably eased pressure on the vendor development

years, vendor management has become critical to the business. Some of the

by lowering the time and costs involved in dealing with more vendors. It has also

Today, this situation has changed. The Indian auto-component industry is

front. Nevertheless, given the severe competitive pressures over the last few

220 at the end of 2004-05. This has helped us enhance supply chain efficiencies

Going forward, we plan to have technically and financially capable set of vendors,

provided our vendors with the requisite volumes to realise economies of scale.

69

improving quality and productivity of the vendors is a priority area for Maruti.

R&D capability. In the long run, Maruti expects its vendors to initiate and

While the average standards have improved significantly over the years, there

is still high variability. Hence, improvement in this area is of considerable

develop specialised components on their own, while it focuses energies on its

operational issues in this regard are discussed below.

whose standards match up to those of Maruti.

core competency of making better cars.

importance to MUL.

‘Focus’) visits by our engineers to our vendors’ production facilities. Junkai

supplying high cost parts. In these workshops, current cost structures of

To help vendors achieve these targets, a team of engineers from Maruti and

gathered greater momentum this year with the introduction of ‘Junkai’ (or

Maruti has been continuously engaging in Value Analysis/Value

these targets. The assistance of vendors’ collaborators, wherever applicable,

Engineering (VA/VE) activities across its operations. This initiative has

In addition, Maruti has started conducting cost workshops with vendors

vendors are analyzed in detail and specific cost reduction targets suggested.

visits facilitate development of fresh VA/VE ideas for cost reduction and

Suzuki visit their production facilities and develop an action plan to meet

R&D activities of Maruti have the twin objectives of reducing product

R&D hub for all Suzuki operations. The company has adopted a ‘focused

costs by developing capabilities of local vendors and becoming a regional

also reduce the cycle time for idea evaluation.

is taken to accelerate implementation.

model cost reduction’ technique.

R&D AND TECHNOLOGY

70

house, resulting in significant reduction in the investment required for these

Audit (GCA)’ mechanism. The GCA methodology places a great deal of

emphasis on delivering products which meet the quality requirements of

reduction in cost of bought-out parts, yield improvement and process cost

modifications done on the new Zen model introduced by the company in

Maruti has raised the bar for quality checks by adopting the ‘Global Customer

prototype making and its evaluation, and stamps / dies designing. All

body panels were developed in- house die-shop for the first time. All the

centre has developed capabilities for face lifts and body changes of current

changes required in the existing production facilities were also developed in

200304 were carried out in-house by the R&D team. The dies for the new

71

technical assistance to local component manufacturers. Over the years, this

In its early days, the Maruti R&D centre was primarily involved in providing

models. These include styling, clay modeling, computer aided design,

The action plan often includes VA ideas, localization of inner parts, and

our customers. In this process, a select number of cars are picked at random

reductions. In the year under review, 33 such visits were made.

everyday and taken through rigorous tests.

QUALITY

modifications.

vendors too. To this end, MUL is actively involved in assisting its suppliers

positioned at 110 key locations throughout the manufacturing process, and

provide real-time feedback for continuous process improvement by

across its manufacturing processes. These ‘Quality Gates’ have been

all functional parts. The total cycle time for GCA is 95 minutes per vehicle.

‘dynamic condition’ by test driving it under varied road conditions to check

Based on the GCA feedback, requisite remedial measures are undertaken to

In the year under review, MUL introduced the concept of ‘Quality Gates’

believe it is imperative that these high quality standards be shared by our

MUL’s press shop and related functions received the TS 16949 quality

We are pleased to report that our initiatives on the quality front have

72

MUL was ranked No. 1 in the prestigious JD Power Customer Satisfaction

certification in 2004-05. While we are proud of this achievement, we

This includes examining the vehicle in ‘static condition’ and then in

Survey, 2003. This No.1 rank is for fourth time in a row — which is a

ensure that defects are not carried in vehicles which are under production.

world record for any automobile leader in a country.

following the concept of “plan-do-check-act”.

to improve their quality practices to TS 16949.

yielded gains:

by JD Power Asia Pacific. In the highly competitive A2 segment, Wagon R

This initiative was given a major thrust with organizing a training program

workmen. Through this training program, management shared its perception

The successes and accomplishments of the company over the years have been

of the company’s future and familiarized the union members with the

for the union working committee members so that the message reached the

entirely due to the motivation, dedication and commitment of its

In 2003, Maruti models topped ‘Initial Quality Study’ conducted in India

In 2004-05, NFO, an international survey agency, ranked Maruti WagonR as

Maruti’s most valuable asset has always been, and will continue to be, its

73

workforce the opportunities and challenges faced in its business

It has been a constant endeavor of the management to share with its

was rated best in overall quality rating, followed by the Zen; while in A3

no.1 in the ‘Total Customer Satisfaction’ for Premium Compact segment.

segment, Esteem achieved top ranking in 2003.

HUMAN RESOURCES

employees.

operations.

people.

Developing human resource capabilities across all levels and functional

areas is integral to the company’s human resource philosophy. As a part of

training program, ‘Sankalp’, was launched to cover 100% of our workmen on

factories in Japan for on-the-job training programs. Varying from one month

business. The Sankalp series will continue through the year to cover the

objective was to highlight the need for a change in mindset and approach to

the global business trends and the ever-increasing competition. The

but also inculcating the Japanese way of working and facilitating cross-

to two years, these programs are not only aimed at enhancing technical skills

this, Maruti Udyog sends its workers, supervisors and engineers to Suzuki

74

competitive pressures faced by the company. Subsequently, a one-day

and change management were organized by the Company for all

cultural exchange. Management training programs focusing on leadership

confidence and strength to keep our costs competitive and bring in greater

Going forward, we believe that this agreement would provide us the

Encompasses a flexible perquisite basket based compensation package.

entire workmen population.

operational resilience.

departmental heads.

75

scheme for workers, this agreement.

made in 2001-02, which was accepted by 1,050 employees.

training-cum-orientation program for new campus recruits.

settlement agreement was signed by MUL with its workers’ union. Apart

from bringing in the concept of cost to company in the remuneration

As on 31 March 2004, Maruti Udyog has 3,334 employees. Industrial

was lost due to strikes or disputes. During 2004-05, a five year wage

relations remained cordial throughout the year and not a single day’s work

Retirement Scheme (VRS) to its employees in the year under review. This

and competitive organization. To this end, Maruti offered a Voluntary

In light of mounting competitive pressures, a priority area for Maruti is to

offer was accepted by 1,251 employees, and followed an earlier VRS offer

Apart from this the Company also has a well-structured, one yearlong

rationalize and redesign its manpower needs to transform itself into a lean

1983 with the implementation of a booking system for its vehicles. With

of operation including marketing and sales, finance, plant and production

centralized ‘extranet’, which allows dealers to log in and transact business in

an online mode. While this system has proved to be effective, to further

enhance operational efficiencies. The IT initiative of the company started in

enhance operational efficiencies, the company is in the process of launching a

across the country. Currently transactions with these dealers are through a

growing business complexities, IT tools have now found use across all areas

leverage innovative and cutting-edge Information Technology (IT) tools to

dealership showrooms, workshops and authorized service stations spread

76

Since its inception 20 years ago, Maruti Udyog has made concerted efforts to

As mentioned earlier Maruti has the widest network of dealer comprises

the company. It would bring in ‘downstream-visibility’ into the distribution

— will provide real-time information on all transactions between dealers and

This system — implemented in Application Service Providing (ASP) mode

network, and standardize service delivery at customer touch points.

management, raw material and spare parts management.

first-of-its-kind Dealer Management System (DMS).

INFORMATION TECHNOLOGY

Maruti has also introduced a Vehicle Tracking System (VTS) at two of its

One of the key initiatives on the operations front has been the introduction of

best practices inherited from Suzuki, and has significantly smoothened our

plants. This acts as an interface between business and shop-floor systems. It

MUL has also taken up e-sourcing as one of the key focus areas for cost

to significantly reduce costs of procurement, while bringing in greater

capability of introducing more products and variants on the same production

reduction and improved procurement. The company has successfully used this

E-Nagare— a system for material scheduling and ordering. This is one of the

enhances shop-floor efficiencies by providing accurate and timely

77

enhanced our quality control systems and has given us an important

Going forward, this infrastructure should provide additional strategic

facilities. VTS along with existing Quality Gate System has considerably

instructions to the shop-floor, along with a feedback to the business systems.

The system is presently undergoing pilot-testing, and is expected to be

Just-In-Time (JIT) operations on the shop-floor.

competitive advantage in today’s scenario.

operational by November 2004.

transparency into the system.

has been established, and is finding increasing popularity among employees

sites of this product developed by Microsoft before its launch worldwide —

is in the process of deploying a software solution which is integrated with

Going forward, MUL intends to increase procurement through e-sourcing, and

Knowledge management is another area of focus for MUL. To this end, an

intranet portal using Microsoft Share point software — one of the first six free

across all levels and functional areas .

MUL’s internal applications.

78

Part-2

The study of micro research profile

79

  • 3. To find the various sources of information about cars from primary

  • 2. To find the brand status, brand loyalty in the mind of customer for

  • 4. To find and analyses the various parameters of buying decision of

  • 5. To find the Strength, Weakness, Opportunity, Threats of the

    • 1. To find the mode of purchase by the customers.

OBJECTIVES OF THE PROJECT

The objectives are.

data through customers.

company.

customers.

Maruti.

80

Management must define a problem in broader way. Because it is said that defining the problem is half solved and the objective of my research is to study the consumer perception about MARUTI CARS over in Indian consumer durable industry.

The nature of my research is exploratory research. It’s goals to shed light on the real nature of the problem and to suggest possible selection and its involves number of steps.

Marketing Research is the backbone of marketing. The objective of my research is to Determine Customer Profiling & Purchase Parameters.

Research Approaches, Research Instrumental, Sampling Plans &

The second stage of marketing research calls for developing the most

Designing the research plan calls for decision on the data sources,

efficient plan for gathering the needed information.

  • I. Define the Problem & Research Objective:

RESEARCH METHODOLOGY

Develop the Research Plan

Contact Methods.

II.

81

Mostly in marketing research involves some primary data

I have collected my research data from secondary as well as

Magazines, Catalogue, Newspapers, Product Profile & Internet.

primary sources from random sampling survey.

collection by the questionnaire

Sample Area : Gorakhpur

  • Sample Size : 100
    (b) Research approaches

  • (a) Data Sources

Secondary Data

Primary Data

82

Following facts were kept in mind while preparation the questionnaire:

problem while answering the questionnaire or in clarifying any confusion

they had. Personal interviews provided flexibility in the sense that the

The target market of our study was mainly concentrated to the recent car

in explaining the respondents the exact list of questions or if they face any

The tool used for this research is questionnaire, administered and filled by

interviewees. The questionnaire was typed and presented to respondents in

an arranged manner. In this process the personal interview came very handy

researcher was able to provide further clarification or explanation whenever

83

Primary data can be collected into five ways – observations, focus

groups, survey, behavioral data & experiments and here I have

buyer's and the survey was conducted at the point of purchase.

  • 1. The questionnaire is in an easy language

TARGET MARKET

used survey research.

METHODOLOGY

required.

84

purchase.

THE RESEARCH

more than one answer for most of them

respondent could elaborate upon his thoughts

people who have recently purchased their cars.

feasible both for the respondents and researcher

the research is to be conducted. The universes of this task constitute all the

Sampling design: The sample design adopted was convenient sampling.

  • 2. Maximum questions are of multiple choice questions and there can be

  • 3. The comments and suggestions were open-ended questions so that the

  • 4. The size of the questionnaire is not too long. This is to make the job

consumer employs in gathering information for the product he is planning to

Aim: The aim of the research was to study the factors which a customer

perceives in a car and the sources as well as the knowledge which the

Universe: The universe means the set of objects or population among which

  • 1. A detailed analysis has been done for Maruti cars on the basis

  • 2. A SWOT analysis for the company has been done.

Analysis has been divided into 2 parts:

ANALYSIS

of questioner.

85

86

  • a) Cash

1.Which car

questioner.

HDFC PNB

ICICI SBI

QUESTIONS:

have you purchased?

  • b) Finance, which company

  • 2. What was the purchase mode?

M&M FSL ANY OTHER __________

Model wise division of the cars purchased

TO FIND OUT MODE OF PURCHASE.

1. A detailed analysis has been done for Maruti cars on the basis of

Cars

               

purchased

Maruti800

Omni

Zen

Alto

WagonR

Versa

SX4

Vitara

In %

25

6

16

36

11

2

3

1

0 Zen Alto SX4 Omni Vitara Versa WagonR Cars purchased Maruti800 40 5 10 15 20
0
Zen
Alto
SX4
Omni
Vitara
Versa
WagonR
Cars purchased Maruti800
40
5
10
15
20
25
30
35

CARS PURCHASED

Europe. Versa's sale has got to pick up because costumers have an unclear

The above figure shows that the ALTO model of Maruti commands a good

picture in their mind regarding the car being high priced which is actually a

Alto model has the largest share in the export category, and is marketed in

share in the market, followed by WagonR and hot selling Zen. ALTO&

Maruti 800 is the undisputed leaders of the roads of Gorakhpur.

INTERPRETATION

myth.

87

0 Purchase M&MFSL PNB HDFC SBI ICICI Cash Mode of 40 5 10 15 20 25
0
Purchase
M&MFSL
PNB
HDFC
SBI
ICICI
Cash
Mode of
40
5
10
15
20
25
30
35

MODE OF PURCHASE

Mode of

           

Purchase

Cash

ICICI

SBI

HDFC

PNB

M&MFSL

In %

16

36

12

19

8

9

As can be seen in the figure above the availability of easy loan has attracted

the consumers to much so that the out of the cars purchased only 16 % of the

vehicles are paid for in cash. With the mushrooming of finance companies

The two rivals in car financing are ICICI and SBI bank with ICICI leading

the rate of interests has been continuously reducing.

The mode of purchase of the vehicle

INTERPRETATION

88

QUESTIONS:

cars with more and more people who have the capability of paying cash

Easy availability of finance have up surged the demand for higher segment

The brand-recalling test showing the brand that has the picture in consumer's

opting for finance due to hassle free approvals and lowest interest rates

TO FIND THE BRAND STATUS IN THE MIND OF

  • 2. Which two TV car commercials (Ads) can you recall

Which are the three brand (companies) that come to

the race due of more and wider presence.

when you think of a car?

CUSTOMER.

.

right now?

your mind

_______________________________________

_______________________________________

89

1.

__________________

__________________

__________________

120 100 80 60 40 20 0 Hyundai Honda Maruti Brand Ford Tata Fiat
120
100
80
60
40
20
0
Hyundai
Honda
Maruti
Brand
Ford
Tata
Fiat

BRAND RECALLED

Recalling

 

Maruti

Hyundai

Tata

Honda

Fiat

Ford

Brand Recalling In %

97

66

40

20

19

12

relies on aggressive marketing tools, followed by the good old Tata which

Maruti when they are asked to name a brand that comes to their mind at the

first instance. Followed by Maruti is a close competitor Hyundai which

As seen in the figure above somewhere down the line people do recall

It can be seen that the more the people recall the brand the more likely are

their flagship Indica.

INTERPRETATION

mind

90

70 60 50 40 30 20 10 0 Maruti800 Maruti service WagonR Hyundai Versa Alto Zen
70
60
50
40
30
20
10
0
Maruti800
Maruti service
WagonR
Hyundai
Versa
Alto
Zen

ADVERTISEMENT RECALL

         

Maruti

   

Advertisement

WagonR

Versa

Alto

Maruti800

service

Zen

Hyundai

In %

3

8

12

11

4

4

58

higher recalling power when it comes to Media advertisements because of

As said earlier in the above brand recalling analysis Hyundai commands a

Also the hot favorite in Maruti ads is the Bachaan father and son ad with the

the chances of good sales turnover

its high advertisement budget.

The advertisements that strike

INTERPRETATION

91

Star

Zee

Any other ____________________

News papers

Times of India

Hindustan Times

Aaj Tak

Zee news

Star News

Any other __________________

Star sports ESPN

Ten sports

Any other ____________________

TO FIND

VARIOUS

SOURCES

OFINFORMATION ABOUT CAR.

QUESTION:

What were the sources of information when you purchase

highest recalling in Maruti brand of cars.

Entertainment channels

Sports channels

News channels

the car?

92

Economic Times

Amar Ujala

 

Bainik Bhaskar

Navbharat Times

Any other _____________________

Magazines

 

Business World

Overdrive

 

India Today

Outlook

Auto car India

Business Today

 

Any other _________________________

Entertainment

 

STAR SPORT

ESPN

TEN SPORTS

IN

%

45

24

31

93

50 40 30 Series1 20 10 0 STAR SPORT TEN SPORTS ESPN
50
40
30
Series1
20
10
0
STAR SPORT
TEN SPORTS
ESPN

SPORTS CHANNEL MOSTLY ACSSESED

60 50 40 30 20 10 0 SONY STAR Zee
60
50
40
30
20
10
0
SONY
STAR
Zee

ENTERTAINMENT CHANNEL MOSTLY WATCHED

Entertainment

STAR

Zee

SONY

In %

54

24

15

INTERPRETATION

94

50 40 30 20 10 0 DAINIK AMARUJALA RAS-SHARA ECO-TIMES TOI
50
40
30
20
10
0
DAINIK
AMARUJALA
RAS-SHARA
ECO-TIMES
TOI

NEWS PRINT MOSTLY READ

Newspapers read

TOI

AMAR

RAS-

DAINIK

ECONOMIC

UJALA

SHARA

S TIMES

In %

18

12

23

40

7

the most followed by ESPN and Ten sports therefore we can say that it

would be better for Maruti to advertise on Star rather than Ten sports. But

Summarizing the above figures we can say that the people watch Star Sports

one has to look at the target audience and then make a feasible decision; it is

than other entertainment channels followed by Zee and Sony India.

possible that a media is good for a certain class of target audience.

Likewise Star has a much wider coverage

95

40 30 20 10 0 Overdrive Business world India Today Auto India Outlook
40
30
20
10
0
Overdrive
Business world
India Today
Auto India
Outlook

MAGAZINE MOSTLY READ

 

Auto

   

Business

 

Magazines read

India

Outlook

Overdrive

World

India

In %

14

9

4

8

34

matter any other language but it is important that to make the ad effective it

media and a good medium for advertising but one has to be sure about its

Print media is perhaps the most effective and the most widely circulated

target audience and then resort to division of the same into different

circulated as well as read newspaper in and around Gorakhpur, followed by

should be positioned right. DAINIK JAGARAN is the most widely

segments. Such as people reading English newsprints or Hindi or for that

Rastriya sahara.

96

Price

[

]

Schemes

[

]

Mileage

[

]

Resale value

[

]

Looks

[

]

After sales services

[

]

Reference

[

]

Advertisement

 

[

]

makes the customer aware and the right kind of expenditure is definitely a

There is a saying that "Advertising is a social waste" but it is advertising that

Similarly the magazine India Today is quite a source of good information

Please rank in order of importance (1 being most important)

TO FIND THE VARIOUS PARAMETER OF

necessity in today's competitive environment.

You choose this brand because :

BUYING DECISION.

INTERPRETATION

for the elite class.

QUESTION:

97

Repeat purchase

wants economy or style,discount or resale, features or services, of all in the

Now the most important question that comes to the consumers mind when

The interviewees were asked to rank the top 6 factors which helped him to

he plans to purchase a car of at the time of purchasing the car. Whether he

Features

[

]

Brand image

[

]

For this we asked the customers to rank the factor which lured him to

purchase the car, the following parameters were taken:

Brand image Repeat purchase

Advertising Features

After sale service

]

same package.

References

Mileage

Discount

Resale

Looks

Price

98

[

 

choose the brand he has chosen.

   

For this we have done a model based study wherein we have taken those

 

models which have a sampl For the ease of understanding we took ranking

in percentage form, also because of unequal sample sizes it became

necessary to take figures in percentages so that the study is not biased.

 

STEPS of computation of ranks:

 

1. Calculating how many people gave what ranks to the factors which were

 

taken under consideration and summing them up.

 

Maruti800

   

sample size=33

           
                       
                       
       

Resale

 

After

 

Adver-

 

Brand

Repeat

Discoun

Mileag

Referenc

Featur

Ranks

Price

value

Looks

sales

tising

Image

purchase

t

e

e

es

1

21

1

2

2

1

0

0

 
  • 0 5

  • 0 1

 

2

3

4

11

5

3

3

2

 
  • 0 1

  • 1 0

 

3

3

1

7

5

8

5

1

 
  • 1 1

  • 1 0

 

4

0

0

2

3

8

10

0

 
  • 1 8

  • 1 0

 

5

0

2

3

4

3

3

4

 
  • 1 6

  • 4 3

 

6

0

3

2

2

2

4

4

 
  • 2 5

  • 8 1

 

In the figure above 21 people gave price as its first preference followed by 3

   

people each who gave 2nd and 3rd rank to price. Similarly for mileage 2

people had ranked it 1st and so on

 
 

99

 

2. Percentage representation of the same out of the sample size of

 

33

customers.

 
               

Adver

     

Resale

After

Brand

Repeat

-

Discoun

Mileag

Referenc

Ranks

Price

value

Looks

Sales

Tising

Features

Image

purchase

t

e

e

1

0.64

0.03

0.06

 

0.03

0

  • 0.06 0

 
  • 0 0.03

0

0.15

 

2

0.09

0.12

0.33

 
  • 0.15 0.09

0.09

 

-

0

  • 0.06 0

0.03

0.03

 

3

0.09

0.03

0.21

 

0.24

0.15

  • 0.15 0.03

 
  • 0.03 0

0.03

0.03

 

4

0

0

0.06

 

0.24

0.3

  • 0.09 0.03

  • 0 0.03

 

0.24

0

5

0

0.06

0.09

 

0.09

0.09

  • 0.12 0.03

 
  • 0.12 0.09

0.12

0.18

 

6

0

0.09

0.06

 

0.06

0.12

  • 0.06 0.06

 
  • 0.12 0.03

0.24

0.15

 

100

               

Adver

     

Resale

After

Brand

Repeat

-

Discoun

Mileag

Ranks

Price

value

Looks

sales

Reference

tising

Features

Image

purchase

t

e

1

 
  • 0.192 0.009

0.009

0.018

   

0

  • 0.018 0

0