PROJECT REPORT ON

MARKETING STARTEGY ON MARUTI SUZUKI

SUBMITTED BY
JADHAV JAYESH SURESH
T.Y.B.M.S. [SEMESTER V]
PADMASHRI ANNASAHEB JADHAVS
B.N.N COLLEGE
DHAMANKAR NAKA, BHIWANDI, 42!"2
SUBMITTED TO
UNIVERSITY O# MUMBAI
ACADEMIC YEAR
2"4 $ 2"%
NAME O# PROJECT GUIDE
PRO#. BHAVANA KHAIRNAR
DATE O# SUBMISSION
DECLARATION
I JADHAV JAYESH SURESH of PADMASHRI ANNASAHEB
JADHAVS B.N.N COLLEGE of TYBMS [Semester V] hereby
declare that I have compiled this project on MARKETING
STARTEGY ON MARUTI SUZUKI in the academic year 20!"
20#$ The information s%bmitted is tr%e and ori&inal to the best of
my 'no(led&e$
Si&nat%re of the St%dent
CERTI#ICATE
I) P&'(. BHAVANA KHAIRNAR hereby certify that JADHAV
JAYESH SURESH of PADMASHRI ANNASAHEB JADHAV*S
B.N.N COLLEGE of TYBMS [Semester V] has completed project
on MARKETING STARTEGY ON MARUTI SUZUKI in the
academic year 20!"20#$ The information s%bmitted is tr%e and
ori&inal to the best of my 'no(led&e$

+rincipal ,oordinator +roject
-%ide


./ternal ./aminer
ACKNOWLEDGEMENT
0Many talented people have contrib%ted to the s%ccessf%l
completion of this (or' and I (o%ld lie to e/tend a (ord of than's
and appreciation to all of them$1
I am indebted to my project &%ide P&'(. B)*+*,* K*-&,*& for
helpin& me o%t in the s%ccessf%l completion of my project report on
M*&./0-,1 20&*0/13 ', M*&40- S454.- L-6-0/7.
I am than'f%l to my teachers for providin& me the information as
and (hen re2%ired$
I am e/tremely than'f%l to my family members for their constant
s%pport$
3ast b%t not the list) are my friends (ho disc%ssed (ith me the
vario%s iss%es in my project$ 4inally) I (ant to than' one and all
(ho helped me directly and indirectly thro%&h the project (or'$
JADHAV JAYESH SURESH

E8ECUTIVE SUMMARY
In this project (e are tryin& to find se&mentation of cars done by
Mar%ti S%5%'i and its effects on c%stomer (e are also tryin& to
st%dy sales trend follo(ed by Mar%ti S%5%'i$ In o%r st%dy (e had
follo(ed different method to find and analy5e the data (e are %sin&
primary data as (ell as secondary data$ Before o%r lot of st%dy is
bein& done b%t none had tried to research on Mar%ti S%5%'i
se&mentation and its effect on sales trend$ 6e had %sed the
2%estionnaire method to st%dy the Mar%ti S%5%'i sales trend (e
had as'ed 2%estion to dealers$ 6hat modification sho%ld Mar%ti
ma'e in its cars to ta'e an ed&e over competitors7 6e are also
%sin& secondary data to analy5e the sales trend of Mar%ti S%5%'i$
In (hich (e had st%died the Mar%ti shares condition in the mar'et$
Its profit and lose its mar'et share and many more$ 6e had
analy5ed (here Mar%ti havin& an ed&e over competitor and (here
it is lac'in& behind$ 8o( it (o%ld improve its sales trend$ 6hat are
analy5in& the f%t%re prospects of Mar%ti in Indian cars mar'et$
INTRODUCTION
Mar%ti S%5%'i India 3imited is India s leadin& 9 lar&est +assen&er car man%fact%rer
(hich acco%ntin& for nearly #0 percent of the total ind%stry sales$ 6ith a vie( to
cater the demand of all types of c%stomer the company has variety of brands in its
bas'et i$e ran&in& from the peoples car Mar%ti :00 to the stylish hatch"bac' S(ift)
S;! Sedan and l%/%ry sports %tility vehicle <S=V> -rand Vitara$ The company has
received ample a(ards and achievements d%e to its contin%o%s innovations and
technolo&ical %p &radations$ The company today is very conscio%s abo%t
safe&%ardin& the environment from vehicle poll%tion (hich res%lted in la%nchin& of its
advanced ?"Series en&ines$ @espite of stiff competition) Mar%ti S%5%'i India 3imited
is presently considered as the leadin& a%tomobile &iant d%e to its remar'able
.conomic) .nvironmental 9 Social performances$ The object of this paper is to
eval%ate the performance of Mar%ti S%5%'i India 3imited (ith respect to ./port)
Sales) +rod%ction and Sales Aet(or'$ Before independence the Indian car mar'et
(as considered as a mar'et for imported vehicles$ The earlier period (as very to%&h
for &ro(th of Indian a%tomobile sector d%e to strict licensin&) restrictive triflin&
str%ct%re$ The Indian Mar%ti S%5%'i started to &ro( after BC0) b%t that &ro(th (as
mainly driven by tractors) scooters and commercial vehicles$ Dfter B:0) the Indian
a%tomobile sector sa( drastic b%t historical chan&e$ 6ith an objective to moderni5e
the Indian Mar%ti S%5%'i Mar%ti =dyo& 3imited (as incorporated in 4ebr%ary B:$ In
Ectober B:2 the company si&ned license and Foint vent%re a&reement (ith S%5%'i
Motor ,orporation of Fapan$ Dfter collaboration) in @ecember B:G) the company
la%nched its most a(aited Mar%ti :00$ The company la%nched its m%lti p%rpose
vehicleH Emni in Aovember B:!$The company la%nched -ypsy in @ecember B:#$
In the year B:C) the company forayed into the forei&n mar'et by e/portin& first lot of
#00 cars to 8%n&ary$
Mar%ti S%5%'i India 3imited <Mar% i S%5%'i>) commonly referred to as Mar%ti and tt
formerly 'no(n as Mar%ti =dyo& 3imited) is an a%tomobile man%fact%rer in India$ It is
a s%bsidiary of Fapanese a%tomobile and motorcycle man%fact%rer S%5%'i$ Ds of
Aovember 202) it had a mar'et share of GCI of the Indian passen&er car mar'et$
]
Mar%ti S%5%'i man%fact%res and sells a complete ran&e of cars from the entry level
Dlto) to the hatchbac' Jit5) ,elerio) D"Star) S(ift) 6a&on J) Ken and sedans @Kire)
?i5ashi and S;!) in the L,L se&ment .eco) Emni) M%lti +%rpose vehicle S%5%'i .rti&a
and Sports =tility vehicle -rand Vitara$The companyLs head2%arters are at Ao )
Aelson Mandela Joad) Ae( @elhi$ In 4ebr%ary 202) the company sold its ten
millionth vehicles in India$
Mar%ti =dyo& 3imited (as established in 4ebr%ary B:) tho%&h the act%al
prod%ction commenced only in B:G$ It started (ith Mar%ti :00) based on the S%5%'i
Dlto 'ei car (hich at the time (as the only modern car available in India$ Its only
competitors (ere 8ind%stan Dmbassador and +remier +admini$ Eri&inally) C!I of
the company (as o(ned by the Indian &overnment) and 2MI by S%5%'i of Fapan$ Ds
of May 200C) the &overnment of India sold its complete share to Indian financial
instit%tions and no lon&er has any sta'e in Mar%ti =dyo&$
0D mar'et is never sat%rated (ith a &ood prod%ct) b%t it is very 2%ic'ly sat%rated (ith
a bad one$ " 8enry 4ord1
HISTORY O# MARUTI SUZUKI
Before independence the Indian car mar'et (as considered as a mar'et for imported
vehicles$ The earlier period (as very to%&h for &ro(th of Indian a%tomobile sector
d%e to strict licensin&) restrictive tariffin& str%ct%re$ The Indian a%tomobile ind%stry
started to &ro( after BC0) b%t that &ro(th (as mainly driven by tractors) scooters
and commercial vehicles$ Dfter B:0) the Indian a%tomobile sector sa( drastic b%t
historical chan&e$ 6ith an objective to moderni5e the Indian a%tomobile Ind%stry
Mar%ti =dyo& 3imited (as incorporated in 4ebr%ary B:$ In Ectober B:2 the
company si&ned license and Foint vent%re a&reement (ith S%5%'i Motor ,orporation
of Fapan$ Dfter collaboration) in @ecember B:G) the company la%nched its most
a(aited Mar%ti :00$ The company la%nched its m%lti p%rpose vehicleH Emni in
Aovember B:!$ The company la%nched -ypsy in @ecember B:#$ In the year
B:C) the company forayed into the forei&n mar'et by e/portin& first lot of #00 cars
to 8%n&ary$ In the year BB0 the company la%nched India s first sedan Mar%ti 000
and .steem in Aovember BB!$ In the year BBC the company started Mar%ti Service
Master as model (or'shop in India to loo' after sales service$ In year 2000 the
company la%nched a call centre$ This (as the first time a car company had ever
la%nched a call centre in India$ In September 2000 the company la%nched its hi&hest
sellin& model Dlto$ In the year 2002 the Mar%ti la%nched Mar%ti finance to offer
financial services li'e e/tended (arranty and finance for car ins%rance$ In the year
2002) S%5%'i Motor ,orporation increased their sta'e in the company to #!$2
percent$ The company la%nched its M+V -rand Vitara in Dpril 200G$ Mar%ti la%nched
its most pop%lar 9 s%ccessf%l hatch"bac' S(ift in 200#$ Mar%ti la%nched diesel
version of S(ift in Fan%ary 200C 9 in May 200C the company la%nched its sedan
S;! in Indian a%tomobile mar'et$ In F%ly 200C Mar%ti =dyo& 3imited renamed
NMar%ti S%5%'i India 3imited $ In March 200:) the company la%nched S(ift @5ire and
in Aovember 200: the company la%nched D"StarH e2%ipped (ith ?"series en&ine$ In
May 200) Mar%ti S%5%'i la%nched its stylish vehicle Jit5$ In the year 20) the
company la%nched its l%/%ry sedan ?i5ashi and (ith an objective to f%lfill the needs
of lar&er family si5e cons%mers) on 2 Dpril 202 the company la%nched its M+V
.rti&a. Initially) in the post"liberali5ation period) the a%tomotive sector) especially the
passen&er car se&ment) sa( a boom) derived primarily from economic vibrancy)
chan&es in -overnment policies) increase in p%rchasin& po(er) improvement in life
styles) and availability of car finance$ The passen&er car ind%stry (as finally
dere&%lated in BBG$ 8o(ever) thesa%ri S%5%'i) (hich contrib%ted s%bstantially to the
ind%strial &ro(th in 4YBBM failed to maintain the same moment%m bet(een 4YBBC
and 4YBBB$
The overall slo(do(n in the economy and the res%ltant slo(do(n in ind%strial
prod%ction) political %ncertainty and inade2%ate infrastr%ct%re development (ere
some of the factors responsible for the slo(do(n e/perienced$ In 4Y2000) the sector
e/perienced a t%rnaro%nd and (itnessed the la%nch of many ne( models$
T(o thin&s that st%nted &ro(th of this ind%stry in the past have been lo( demand
and lac' of vision on the part of the ori&inal e2%ipment man%fact%rers <O.Ms>$
8o(ever) the demand pic'ed %p after the liberali5ation of the re&%latory
environment) and &lobal O.Ms" (ho enjoy scale economies both in terms of
man%fact%rin& and research and development <J9@> " entered the Indian mar'et$
This has res%lted in a bi& shift in the (ay b%siness is cond%cted by s%ppliers)
assemblers and mar'eters$
PRO#ILE O# MARUTI SUZUKI INDIA LIMITED
Mar%ti S%5%'i India 3imited is a s%bsidiary of S%5%'i Motor ,orporation)
Fapan 9 India s leadin& passen&er car man%fact%rer) acco%ntin& for nearly !#
percent of the total ind%stry sales$ Mar%ti S%5%'i offers M brands (ith near abo%t
#0 variants$ Mar%ti offers vario%s brands (hich incl%de Mar%ti :00) Dlto :00) Dlto
?0) .stilo) 6a&on"J) Emni) .eco) D"Star) Jit5) -ypsy) S(ift) S(ift @5ire)
S;!) .rti&a) ?i5ashi and -rand Vitara$ The company is en&a&ed in the b%siness
of +%rchase) Man%fact%rin&) and Sales of vehicles 9 spare parts$ Mar%ti S%5%'i is
also en&a&ed in other activities li'e +re o(ned car sales) ,ar financin& 9 4leet
mana&ement$ Mar%ti S%5%'i &ot vario%s a(ards and accolades in its profile$ It has
ran'ed no$ in F@ +o(er Dsia +acific ,%stomer Satisfaction Inde/ <,SI> s%rvey
200B for ten times in a ro($ Mar%ti S%5%'i &ot ,AB, TV: a(ard 20 for
man%fact%rer of the year$
Mar%ti S%5%'i is the only Indian company (ho has crossed the 0 million sales mar'
since its inception$ The company has t(o man%fact%rin& facilities in Manesar
and -%r&aon) 8aryani) India$ The -%r&aon man%fact%rin& plant has a
man%fact%rin& capacity of nine la'h %nits ann%ally$ Dccordin& to
Mr$J$,$Bhar&ava",hairman) Mar%ti S%5%'i India 3imited) Mar%ti S%5%'i India
3imited finali5ed Js$C00 crore investment for do%blin& the diesel en&ine capacity at
-%r&aon Man%fact%rin& 4acility to M)00)000 %nits by 20!$ The -%r&aon plant also
havin& ? Series en&ine plant$ Since inception of this plant) till date over 0 la'h ?
Series en&ine have been rolled o%t$ Mar%ti S%5%'i s Manesar man%fact%rin&
facilities have t(o f%lly inte&rated plants havin& capacity of #$# la'h %nits
ann%ally$ Mar%ti S%5%'i is also ahead in Social activities$ Ds a responsible corporate
citi5en Mar%ti S%5%'i introd%ced (orld class drivin& trainin& facilities to India by
la%nchin& Instit%te of @rivin& 9 Traffic Jesearch$ These incl%de a specially
form%lated m%ltilin&%al theory c%rric%l%m) scientifically laid"o%t drivin& trac's and
advanced drivin& sim%lators that replicate Indian drivin& conditions$ In 200:)
Mar%ti S%5%'i introd%ced Aational Joad Safety Mission$ =nder this initiatives)
the company too' a commitment of trainin& over #)00)000 people in safe drivin&
practice in a span of three years$ Dlso (ith an objective to improve road safety and
inc%lcate safe and systematic drivin& habits amon& people) Mar%ti S%5%'i has
opened Mar%ti @rivin Trainin& School <M@S>$ These drivin& schools are e2%ipped
(ith +ractical Trainin& and Dttit%d Trainin&$
OBJECTIVES O# MARUTI SUZUKI
To foc%s on historical &ro(th of Mar%ti S%5%'i India 3imited$
To eval%ate the performance of Mar%ti S%5%'i India 3imited (ith
respect to ./port) Sales) +rod%ction and Sales Aet(or'$
To Jevie( the pro&ress of Indian D%tomobile Sector
To %nderstand the Mar'etin& Strate&ies of Mar%ti S%5%'i India 3imited
+rod%ction of f%el"efficient vehicles to conserve scarce reso%rces$
RESEARCH METHODOLOGY
The p%rpose of methodolo&y section in the report ma'in& is to describe the research
process that is follo(ed (hile doin& the main part$ This (o%ld ho(ever incl%de the
research desi&n) the samplin& proced%re) and the data collection method$ This
section is perhaps diffic%lt to (rite as it (o%ld also involve some technical terms and
may be m%ch of the a%dience (ill nor be able to %nderstand the terminolo&y %sed$
The methodolo&y follo(ed by the researcher) d%rin& the preparation of the report
(asP
R/2/*&9) D/2-1, :
D research desi&n is p%rely and simply the frame(or' or plan for a st%dy that &%ides
the collection and analysis of data$ The s%rvey research (as %sed in this project)
beca%se cons%mer*s feedbac' (as necessary for obtainin& the data.
R/2/*&9) I,20&46/,0 :
4or doin& the s%rvey research) str%ct%red 2%estionnaire (ith both open"ended and
closed"ended 2%estions (as %sed$
M'7/ '( S4&+/3 :
The mode of s%rvey (as personal intervie( (ith the respondents d%rin& the fillin&
%p of the 2%estionnaires.
P/&2',*; V-2-02 :
Ds a part of the analysis) it (as necessary to visit the st%dents of different school) as
it (o%ld al(ays help me 'no(in& the nat%re of st%dents$ 6e visited different schools
and as'ed the st%dent different 2%estions (hich are formatted in the 2%estionnaire$
DATA SOURCES
P&-6*&3 D*0* :
+rimary data is that 'ind of data (hich is collected directly by the investi&ator himself
for the p%rpose of the specific st%dy$ +rimary @ata is collected by the investi&ator
thro%&h intervie(s of company employees) vendors) distrib%tor etc$ @ata s%ch
collected is ori&inal in character$ The advanta&e of this method of collection is the
a%thentic$ D 2%estionnaire of abo%t #0 2%estions (as made and it (as &iven to the
dealers to fill it %p for o%r research$ The research (as a 'ind of concl%sive research
as it helps in the testin& of hypothesis$ The method of samplin& (as the Jandom
method as it is %nbiased$
S/9',7*&3 D*0* :
6hen an investi&ator %ses the data that has been already collected by others) is
called secondary data$ The secondary data co%ld be collected from Fo%rnals)
Jeports) libraries) ma&a5ines) fair 9 conference and other p%blications$ The
advanta&es of the secondary data can be QIt is economical) both in terms of money
and time spent $The researcher of the report also did the same and collected
secondary data from vario%s internet sites li'e ((($&oo&le$com) ((($airtel$com)
((($h%tch$co$in and many more$ The researcher of the report also visited vario%s
libraries for collection of the introd%ction part$
SAMPLE DESIGN<
6hile developin& a sample desi&n) follo(in& points sho%ld be 'ept in mindP
S*6=;-,1 4,-0P
D decision has to be ta'en concernin& a samplin& %nit before selectin& sample$
Samplin& %nit may be a &eo&raphical one s%ch as state) district) villa&e etc or a
constr%ction %nit s%ch as ho%se) flat etc$ or it )may be as social %nit s%ch as family)
cl%b) school etc or it may be an individ%al $ the researcher (ill have to decide one or
more of s%ch %nits that he has to select for his st%dy
S-5/ '( 0)/ 2*6=;/P
This refers to the n%mber of items to be selected from the %niverse to constit%te a
sample$ This is a major problem before a researcher$ The si5e of the sample sho%ld
be neither is e/cessively lar&e) nor too small$ it sho%ld be optim%m
Dn optim%m sample is one (hich f%lfills the re2%irements of efficiency)
representatives) reliability and fle/ibility
OBJECTIVES O# THE STUDY
The present st%dy of the mar'etin& strate&y of the Mar%ti S%5%'i <+vt$> 3imited
revolves aro%nd the follo(in& broad objectivesP
To st%dy the evol%tion and &ro(th of the Mar%ti S%5%'i <+vt$> 3imited in the
conte/t of the a%tomobile revol%tion in IndiaH
To st%dy the &ro(th strate&y of the Mar%ti S%5%'i <+vt$> 3imited and the
mar'etin& methods follo(ed by it in this re&ard$
To st%dy the small car revol%tion in India and the contrib%tion of the Mar%ti
S%5%'i <+vt$> limited to it$
LIMITATIONS O# RESEARCH
@%e to the follo(in& %navoidable and %ncontrollable factors the res%lts mi&ht not be
acc%rate$ Some of the problems mi&ht face (hile cond%ctin& the s%rvey are as
follo(sP
,ertain open"ended 2%estions have been p%t in the 2%estionnaire to &ive
respondents freedom to e/press their perception$
Time and cost constraints (ere also there
,hances of some biasness co%ldn*t be eliminated$
D sample si5e of 00 has been %sed d%e to time limitations$
The data has been collected from @elhi<Aorth> and there the perception of the
people from the smaller to(ns co%ld not be j%d&ed
Dl the data has been collected at random b%t it is al(ays liable fro biasness$
The primary data has been collected from the middle and %pper section of the
society$
COMPONENTS
In India the components ind%stry (as concentrated in poc'ets (hich) ho(ever) (ere
at the fo%r points of the Indian compassP Bombay in the 6est) ,alc%tta in the .ast)
MadrasRBan&alore in the So%th) and @elhi in the Aorth$ The materials) parts) and
components %sed in car man%fact%rin& can be cate&ori5ed in at least three (ays)
vi5$ by so%rce) by type) and by val%e$ ,lassification by so%rce res%lts inP
in"ho%se man%fact%re by the car assembler
Man%fact%rers of finished parts s%ch as radiators) cl%tches) bra'es)
shoc' absorbers) etc$
S%b"contractors for t(o above and for secondary parts <i$e$ for re&%lar
parts s%ch as scre(s) &ears) sprin&s) etc$>
S%b"contractors of the assemblers <i$e$ companies involved in castin&)
for&in&) machine"processin&) platin&) etc$>
Man%fact%rers of related parts li'e tyres) batteries) bearin&s) etc$
These co%ld be either established companies or ne( entrants$ They ran&ed in si5e
from the lar&er companies in the land to some of the smaller ones$ The total o%tp%t
of the or&ani5ed se&ment of the Indian ancillary sector (as aro%nd Js :)000 million$
PRODUCT RANGE
It offer f%ll ran&e of cars Q from entry level Mar%ti :00 9 Dlto to stylish hatchbac'
Jit5) S(ift) 6a&on J) .stillo and Sedans @Kire) S;! and Sports =tility vehicle -rand
Vitara$
Mar%ti :00
Emni
S(ift
Dlto
6a&on J
.stillo
S(ift @Kire
D"star
S;!
-rand Vitara
.rti&a
,elerio
Jit5
.eco
Dlto ?0
PASSENGER CAR INDUSTRY IN INDIA< HIGHLIGHTS
+assen&er car sales are e/pected to increase at a compo%nd ann%al &ro(th
rate <,D-J> of :I over the period 4Y200!"200C$ The si/ broad se&ments in
the car mar'et today are" Mini) ,ompact) Midran&e) ./ec%tive) +remi%m and
3%/%ry$ In the medi%m term) &ro(th in the Indian passen&er car ind%stry is
e/pected to be led lar&ely by the ,ompact and Mid"ran&e Se&ments$
The critical s%ccess factor has chan&ed from price to price val%e$
In terms of en&ine capacity) the Indian passen&er car mar'et is movin&
to(ards cars of hi&hest capacity$
6ith the la%nch of ne( models from 4Y2000 on(ards) the mar'et for M=Vs
has been redefined in India) especially at the %pper end$ ,%rrently) the hi&her"
end M=Vs) commonly 'no(n as Sports =tility Vehicles <S=Vs>) occ%py a
niche in the %rban mar'et$ 6ith the s%ccess of S=Vs) the line of distinction
bet(een passen&er cars and M=Vs in the Indian mar'et is &ettin&
increasin&ly bl%rred$
@omestic car man%fact%rers are no( vent%rin& into areas s%ch as car
financin&) leasin&) and fleet mana&ement) and %sed"car reconditionin& Rsales)
to complement their mainstay"b%siness of sellin& ne( cars$
TRENDS IN THE INDIAN PASSENGER CAR INDUSTRY
Indian
Passenger Car

Industry
Manufacturing
Technologies:
Flexible
Manufacturing
Systems
Components:
Tierisation;
Tyres: Radials,
Retreading
Regulatory
framework:
Deregulation;
De licensing;
Removal of QRs;
ntroduction of strict
!mission norms
Auto finance:
"etter# c$ea%er sc$emes
Distribution ystems:
&$anging relations$i% of
manufacturers 'it$
dealers and su%%liers
Materials: (o'
'eig$t; Synt$etic
&om%osites
!ntry of Foreign
Manufacturers
Product technology:
M)F; &RDi; diesel
system
tructure of
demand:
&$ange in industry
segmentation
KEY DEVELOPMENTS IN THE INDUSTRY
&*M)+,- ,+M!
D!M"TIC A#" MAR$"T %AR"
+)R.
+/0
1223
+)R.
+/0
1242
0R*5T
6
+)R.
+/0
1223
+)R.
+/0
1242
Daimler &$rysler ndia )vt
(td 788 771 9.7 2.1 2.1
Fiat ndia +utomobiles )vt
(td 132: 78; .:<.1 2.3 2.1
Ford ndia (td <<;1 7399 .14.7 1.< 1.4
0eneral Motors ndia (td :4:3 93<4 .82.7 1.8 4.;
6industan Motors (td ;742 ;717 2.8 4.< 4.:
6onda Siel &ars ndia (td 48<48 4:;72 1:.4 9.9 ;.8
%yundai Motor India #td &'()) *+,&- +-./ ,0.+ ,)
Maruti /dyog (td 47122: 473727 9.: ;4.9 ;4.4
S=oda +uto ndia (td 8228 8983 49.; 4 4
Tata Motors (td ;<;9< ;;;87 .;.4 4<.7 47.:
Toyota >irlos=ar Motor
(td 9;43 9282 .42.< 4.9 4.1
Total Passenger Car ales +,0+/- ++(,0) 0.+ ,-- ,--
@%rin& Dpril Q D%&%st 200M) the passen&er car sales in India at GG2#B %nits) mar'ed
a &ro(th of #$GIover the previo%s year$ The &ro(th in the domestic sales of
passen&er cars (as led by stron& &ro(th in vol%mes reported by compact and mid Q
si5e se&ments$ 6hile the share of mini and e/ec%tive se&ments declined in the
period %nder st%dy) the share of other se&ments increased$ 4or instance) the share
of compact se&ment in the domestic car sales increased from #B$CI in Dpril Q
D%&%st 200# to M!$BI in Dpril Q D%&%st 200M) mid Q si5e se&ment from 20$#I to
22I) and the share of +remi%m se&ment (as sta&nant at 0$CI in the same period$
Ae( variants la%nches) easy availability of finance at relatively lo(er interest rate
and price disco%nts offered by the players have played an important role in drivin&
the sales &ro(th in the domestic passen&er car ind%stry$
KEY DEMAND DRIVERS
Traditionally) disposable income (as perceived as the 'ey factor drivin& passen&er
car demand$ B%t over time) other factors that are 'no(n to have an impact on
demand have emer&ed$ These incl%de the need for &reater mobility) non" availability
of p%blic transport services) availability of cheap finance) development of the %sed"
car mar'et) introd%ction of ne( technolo&ically s%perior models) increasin& levels of
%rbani5ation and chan&in& cons%mer profiles$
SEGMENT ANALYSIS
C A R
D " M A 1 D
T $ e r e i s a $ i g $
d e g r e e o f
c o r r e l a t i o n
b e t ' e e n t $ e
d e m a n d f o r c a r s
a n d " C ! 1 ! M I C
2 R ! 3 T % .
+ v a i l a b i l i t y o f
1 " 3 M ! D " #
i s l i = e l y t o
i n c r e a s e a n d
c $ a n g e t $ e
s t r u c t u r e o f
d e m a n d .
& o m % e t i t i v e
P R I C I 1 2 i s
c r u c i a l f o r g a i n i n g
m a r = e t s $ a r e ,
e s % e c i a l l y i n t $ e
s m a l l c a r s e g m e n t .
+ ? + ( + " ( T - * F & 6 ! + )
F , + , & ! i s a k e y
d e t e r m i n a n t o f d e m a n d a s
m o s t c a r s 4 a r o u n d * - 5 6
p u r c h a s e d i n I n d i a a r e
f i n a n c e d .
+ m a t u r e 7 " D C A R
M A R $ " T ' o u l d , o n o n e
$ a n d , e n c o u r a g e
c o n s u m e r s t o t r a d e i n t $ e i r
c a r s f a s t e r , a n d o n t $ e
o t $ e r , e a t ' e l l i n t o t $ e
s $ a r e o f n e ' c a r s .
T $ e & e n t r a l
0 o v e r n m e n t @ s A 7 T !
P ! # I C 8 o n e x c i s e
a n d c u s t o m s i s a n
i m % o r t a n t a s % e c t
a f f e c t i n g t $ e d e m a n d
a n d s u % % l y o f c a r s .
6 i g $ d e g r e e o f c o r r e l a t i o n b e t ' e e n P " R
C A P I T A I 1 C ! M " a n d d e m a n d f o r c a r s ,
i n c r e a s e i n t $ e n u m b e r o f % e o % l e c r o s s i n g
t $ e i n c o m e t $ r e s $ o l d , a n d C % A 1 2 I 1 2
& * , S / M ! R ) R * F ( ! a r e l i = e l y t o
i n c r e a s e a n d c $ a n g e t $ e s t r u c t u r e o f
d e m a n d .
MI1I
C!MPAC
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?e$icle (engt$ A8922mm +&-,9&--- 9224.9;22 9;24.9:22
9:24.
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Maruti 7dyog
#td
<22 Alto !steem
*mni :en "aleno
3agon R +ltura
<ersa
6yuindai Motor
ndia (td antro Accent
"lantr
a onata
6industan Motors
(td
+mbassado
r &ontessa
Mitsubis$i
(ancer
Fiat ndia
+utomobile (td
Palio Siena
7no adventure
5ee=end
0eneral Motors
ndia (td
Corsa ail *%el &orsa *%el ?ectra
*%el +stra
*%el S'ing
6onda Siel ndia
(td &ity
+ccor
d
Ford ndia (td =on
Monde
o
T!(&* Indica ndigo
Dalmier&$rysler
ndia (td
Mercedes
"enC &
&lass,M
&lass,S(
Merce
des
"enC
!
&lass
Mercedes
"enC S
&lass
S=oda ndia (td *ctavia
Toyota >irlos=er
Motor (td &orolla &amry
The credit for &ro(in& the Indian ,ompact Se&ment) and in fact) the Indian
+assen&er car ind%stry &oes partly to the ?orean man%fact%rers <8MI3 and the
erst(hile @ae(oo> and the Indian player Tata Motors$
The 8MI3 Santro (as la%nched in SeptemberBB: and created a sensation on
acco%nt of its a&&ressive pricin& at Js$2) BB)000$ The Santro became s%ccessf%l as
8MI3 had &ot the price Qval%e e2%ation j%st ri&ht$ 6hile @ae(oo*s Mati5 pic'ed %p
only seven months after its la%nch) the Santro (as sellin& more than G000%nits a
month only 2 months after its la%nch$ 8MI3 had infact) planned its entry into the
Indian mar'et (ith the !B#cc Dccent b%t later opted in favo%r of the smaller car$ Dt
the time the Santro (as la%nched) both the options available in the se&ment" 4iat
=no and the Ken"had been aro%nd in the Indian Mar'et for 2%ite some time and
lac'ed novelty$ Santro (as not only cheaper b%t also incorporated a m%lti"point f%el
injection <M+4I> system that offered s%perior f%el economy to Ken*s carb%retor
system$
The Mati5 (as la%nched in Aovember BB:$ Its :00cc en&ine immediately
enco%ra&ed comparisons (ith Mar%ti :00$ The initial la%nch price of Mati5 at Js$ G)
##)000 (as si&nificantly hi&her than the Santro*s Js) 2) BB)000$ -iven that the Mati5
(as smaller than the Ken and the Santro) the initial impact (as not so stron&$ In May
BBB) @ae(oo la%nched stripped"do(n variants$ The la%nch of the cheaper versions
sa( the sales of Mati5 reachin& almost 2000 %nits in May BBB and recordin& an
avera&e monthly sale of G2G%nits in 4Y2000$ 8o(ever) the financial crisis faced by
the parent) @ae(oo Motor ,orporation affected the performance of the Indian
s%bsidiary <that (as reportin& net loss and had si&nificant borro(in&s>$
S%bse2%ently) the Indian s%bsidiary halted prod%ction$
M=3 no( has ! cars in the ,ompact Se&mentP the S(ift) the Ken) the Dlto and the
6a&on J$ In terms of mar'et share) Ken steadily lost share in 4Y2000 to its
competitors$ @espite this) there is no denyin& that the Ken is one of the bi&&er
s%ccess stories in the Indian car mar'et$ 6ith G models) M=3 is the mar'et leader in
the ,ompact se&ment$
The Dlto arrived in India (hen there (as little room for man oe%vre in a cro(ded
compact se&ment$ It (as la%nched in 2 versions) the 3; and the V;$ The base
version is priced competitively (ith the del%/e version of the Mar%ti:00) (hile the
hi&her"end version competes (ith the based versions of the Ken and the 6a&on J$
The 0Mcc 6a&on J is available in fo%r man%al transmission variants <3;) 3;i) V;
and V;i> and one a%tomatic transmission variant <D;>$ Since its introd%ction in
4ebr%ary 2000) 6a&on J has been sellin& in the #00"G000%nits per month ran&e as
a&ainst #000":000%nits per month ran&e for the Santro$ The presence of the already
(ell"established Mati5 and the Santro meant that the novelty factor did not (or' too
(ell for 6a&on J$
8o(ever 200# has been a revol%tionary year for Mar%ti since its ne( 3a%nch S(ift
has been a h%&e s%ccess in the mar'et and the most demanded car as (ell$
The other cars in the compact se&ment to have made an immediate dent in the
mar'et (ith their la%nch are the +alio of 4iat India and the improved version Indica
V2 of Tata Motors$ Indica (as the third lar&est sellin& car in 4Y2002 in this se&ment)
after Santro and Ken$ En the other hand) +alio (as la%nched at the time (hen the
passen&er car ind%stry (as (itnessin& a sl%mp b%t the model c%t across the barriers
and (as able to create a mar'et for itself$ 8o(ever) the s%ccess of this model (as
short"lived and the sales declined thereafter$ Aevertheless) la%nches of ne( variants
<s%ch as the diesel version> helped sales recover mar&inally$
The si5e of the compact se&ment has increased as a res%lt of the hi&h &ro(th rate
attained by the models in this se&ment$ The chan&in& price"val%e e2%ation) co%pled
(ith the declinin& interest rates and easy availability of finance) has prompted
cons%mers to move to(ards the compact car se&ment from the mini se&ment$ The
hi&h rate of &ro(th achieved by the compact se&ment has attracted the attention of
other players alsoH incl%din& -M$ -M has entered the compact se&ment (ith the
la%nch of its Epel ,orsa Sail in May200G$
MARUTI TOOK THE INITIATIVE AND GAINED
In the late BB0s) car man%fact%rers li'e 4ord) -eneral Motors) and 4iat (ere farin&
miserably in the Indian mar'et$ Mar%ti had a mar'et share of a (hoppin& CB per cent
in the passen&er car se&ment$ @ae(oo and Telco (ere creatin& hype over the
impendin& la%nches of their cars Mati5 and Indica) respectively$ In s%ch a scenario)
the top mana&ement of 8y%ndai Motor India 3td) (hich has So%th ?orean ori&ins)
had a to%&h decision to ma'e$ It (as a bi& &amble to &o ahead (ith the la%nch of the
small car QSantro$ The 8y%ndai mana&ement st%c' to a simple strate&y Q la%nch a
2%ality prod%ct in the most promisin& se&ment
(ith the latest technolo&y and price it a&&ressively$ In the pre"la%nch period in late
BBC) the company commissioned mar'et research project to %nderstand the
Indian cons%mer psyche and specify a benchmar' for the pricin& policy$ The res%lts
of this s%rvey and the actions ta'en thereafter had a bearin& %pon the s%ccess of the
prod%ct later on$ The Indian cons%mers sho(ed an immense disli'e to the shape of
Santro$ Ene cons%mer even li'ened it to a 0f%neral hearse1$ D second important
res%lt (as that 8y%ndai is an %n'no(n brand (ith
almost 5ero brand e2%ity amon&st Indian cons%mers$ The company immediately
%ndertoo' the initiative of reshapin& and c%stomisin& the car for the Indian c%stomer$
The tall rear end (as red%ced and made more aesthetically appealin&$ The Santro
(as all set for the Indian la%nch$
MARUTI:MARKETING GENIUS
8ere came the most important aspect of the la%nch Q the mar'etin& strate&y$ This
(as a factor that co%ld ma'e or mar the s%ccess of the Santro$ 8y%ndai tied %p (ith
the advertisin& a&ency Saatchi and Saatchi) (ho hit %pon a novel strate&y$
Bolly(ood star Shah J%'h ?han (as roped in to be the brand ambassador$ D three"
pron&ed strate&y (as desi&ned to attract the cons%merP
.d%cate Indian ,ons%mers abo%t 8y%ndai
,reate hype and e/pectations abo%t the Santro
./plain the virt%es of the Santro
The TV 9 +ress ,ampai&n bro'e in F%ne BB:$ The initial TV spots and the press
campai&n sho(ed Shah J%'h ?han bein& approached by a 8y%ndai official to
advertise the Santro$ Shah J%'h (as not convinced abo%t 8y%ndai and he (as
sho(n to as' all 2%estions a normal Indian cons%mer is e/pected to as'$ 6hat is
8y%ndai7 6hy sho%ld I advertise for the Santro7 6ill it match c%stomer service
e/pectations7 6hat abo%t dealer net(or's7 8o( can an international car meet the
re2%irements of Indian roads7 Ds the campai&n (ent thro%&h all of these 2%estions)
the 8y%ndai official ans(ered Shah J%'h ?han$ By the time the car (as act%ally
la%nched) Shah J%'h ?han proclaims) 0he is convinced1$ 8e declares that he is no(
ready to advertise the Santro since he is certain that the Santro is the car for India$
This hi&h profile campai&n bac'ed by some very innovative media b%yin&) (hich
(ent for ma/im%m covera&e (ith the minim%m b%d&et) bro'e all &ro%nds in terms of
creatin& cons%mer e/pectations and hype in the mar'et$
Dlon& (ith the Ddvertisin& ,ampai&n) the Sales Team (or'ed b%rnin& midni&ht oil in
creatin& the dealer net(or' across the len&th and breadth of the co%ntry$ The (ide
dealer net(or' (o%ld prove to be inval%able in ens%rin& that the Santro (o%ld be
available to anyone (ho (ants to b%y it$ Dn important pre"re2%isite for the dealer
net(or' (as a f%lly f%nctional (or'shop area (ith imported international standard
e2%ipment and en&ineers trained in 8y%ndai*s parent trainin& centre in So%th ?orea
and localised trainin& provided in the ,hennai +lant$
SALES NETWORK
Mar%ti S%5%'i has the lar&est sales and service net(or' amon&st car man%fact%rers
in India$ It had :02 sales o%tlets in ### cities and 2C!0 service (or'shops in GG#
cities$ The service net(or' of the Mar%ti S%5%'i incl%des @ealer (or'shops)
D%thori5ed service stations and Mar%ti service 5ones$ The follo(in& pie chart clearly
describes the sales net(or' of Mar%ti S%5%'i$
It is amply clear from the above pie chart that) Mar%ti S%5%'i &rad%ally increased its
sales and service net(or'$ In year 200#"0M) the total sales net(or' (ere GC#
(hereas in year 200M"0C the n%mber of sales net(or' reached to !B$ In year 200B"
0 the n%mber of Sales net(or' increased by 2 over 200:"0B and reached to :02$
In year 20"2 the total n%mber of Sales net(or' (as 00 i$e a &ro(th of C$:B
percent over 200"$
PER#ORMANCE O# MARUTI SUZUKI INDIA LIMITED
DOMESTIC SALES
Mar%ti S%5%'i is the only Indian company (ho has crossed the 0 million sales mar'
since its inception$ The company has the lar&est sales and service net(or' amon&st
car man%fact%rers in India$ In the month of Ectober 202) Mar%ti S%5%'i reported
:#$!M percent increase in total sales at )0G)0: vehicles) in same month the
company had recorded domestic sales of BM)002 vehicles compared to #)!#:
vehicles in 20$ In Aovember 202) the company sold total )0G)200 vehicles and in
the same month last year) the company sold B)CC2 vehicles$ 6e can see the
performance of Mar%ti S%5%'i (ith respect to @omestic Sales thro%&h follo(in&
&raph$
4rom the above chart it is revealed that the domestic sales of Mar%ti S%5%'i India
3imited in year 200B"0 (as :)C0)CB0 vehicles i$e a &ro(th of 20$#: percent than
domestic sales of 200:"0B$ In year 20"2 Mar%ti S%5%'i sold 00MGM vehicles i$e
a ne&ative &ro(th of <"> $M percent over 200"$ In year 200") the company
sold G2CGB vehicles$ The follo(in& pie chart describes the net sales of Mar%ti
S%5%'i d%rin& 200!"0# to 20"2$
4rom the above pie chart it is revealed that Mar%ti S%5%'i s total Aet Sales in year
200!"0# (as 0B0: million (hereas the net sales in year 200#"0M (as 20)0G!
million$ In year 200") Mar%ti s total net sale (as GM)2:2 million (hereas the total
net sale in year 20"2 (as G!C)0#B million$ In year 20"2 Mar%ti S%5%'i s net
sale (as decreased by <"> G$BG percent over 200"$
E8PORT
Mar%ti S%5%'i India 3imited e/portin& to B: co%ntries in .%rope) Dsia) 3atin Dmerica)
Dfrica and Eceania$ Some leadin& overseas mar'ets of Mar%ti incl%de -ermany)
Aetherland) 4rance 9 =?$ +resently the company e/ports vario%s models li'e D"Star)
Jit5) .stilo and Mar%ti :00$ In year 200B"0) Mar%ti S%5%'i cloc'ed e/port sales of
!C)#C# %nits its hi&hest ever and in 20"2) the company e/ported )2C)G00 %nits$
The follo(in& are the top ten e/port destinations of Mar%ti S%5%'i India 3imited$
Country <ehicles "=ported 4In 1o6 D+s on 84
Marc$ 1242E
Aetherlands C:)#!
Dl&eria M:)#0M
Italy #2)2#0
=nited ?in&dom !:)M!
,hile !#)02B
-ermany G:)!2G
Srilan'a G0)0C:
8%n&ary 22)B2!
Aepal 22)GM:
.&ypt :)#2G
The follo(in& chart clearly foc%ses on ./port of Mar%ti S%5%'i d%rin& 200!"0# to
20"2$
It is revealed from the above chart that the e/port of Mar%ti S%5%'i in year 200B"0
(as !C)#C# vehicles (hereas the company e/ported G:)2MM vehicles in year
200" i$e the year 200" sa( ne&ative &ro(th by <"> M$G0 percent over 200B"0$
The year 20"2 had also seen a ne&ative &ro(th by <"> C$:C percent over 200"$
The year 200B"0) recorded marvello%s &ro(th of 0$C# percent over 200:"0B$ The
follo(in& &raph stated the economic performance of Mar%ti S%5%'i India 3imited
d%rin& 200!"0# to 20"2$ The &raph depicts the profit of company after ta/$
ARRIVAL O# SMALL CARS IN INDIAN MARKET WAS THE
BEST THING TO HAVE HAPPENED TO MARUTI
The race for IndiaLs small"car mar'et has be&%n$ B%t only those amon& the bi& fo%r
(ho &et all their strate&ies ri&ht (ill (in this %nfor&ivin& contest$ The pri5eP not j%st
the lar&est a%tomobile se&ment) b%t also s%rvival in this mar'et$ TheyLre lined %p for
the last lap$ 6ith Mar'et India becomin& a minefield for the (orldLs lar&est a%to"
ma'ers) the 4orm%la I has become bri&hter than the red li&hts that have stopped
them in their trac's so far""only the small car (ill enable end%rance$ B%mper"to"
b%mper) therefore) the combatants are acceleratin& to(ards the small"car se&ment$
Dmo%ntin& to M0 per cent of the Js !)#00"crore a%tomobiles mar'et) and hitherto
monopolised by the Js :)!#!"crore Mar%ti =dyo& (ith its Mar%ti :00 and Ken) itLs the
final frontier bet(een s%rvival and e/tinction$ So far) acc%stomed as they are to the
priorities of the c%stomer in the developed mar'ets) the &lobal a%to"ma'ers have
ta'en many (ron& t%rns in India$ Enly no() after many 'noc's) crashes) and repair
jobs) are they bac' on trac') headin& to(ards their destination$
B%t neither the road nor the end"point of their jo%rney is (ide eno%&h for all of them$
Dt projected M"la'h %nits by 2000) demand for cars is still 2# per cent less than the
n%mber of 4"#0 pic'"%p tr%c's sold by the S#G$M2"billion 4ord Motor ,o$ in BBC$
B%t the importance of India on the (orld a%to map is strate&ic$ 6ith an estimated
total capacity of #: million %nits a year) the &lobal a%to ind%stry is racin& far a head
of the demand of !# million %nits$ Mar'ets in Aorth Dmerica) .%rope) and Fapan""
(hich acco%nt for C! per cent of the demand""have become sat%rated$ -lobal car"
man%fact%rers (ill need to plant their feet in a lo("cost) yo%n&) stable mar'et to sell
their prod%cts to create a &lobal s%pply"base for cars and components$ The first
(ave of man%fact%rers simply failed to ma'e a splash in India$ They (ere revvin& %p
for a &ro(th that never happened$ Their entry reasonin&P since India had been a
small"car mar'et for years) it (as only a matter of time before it enlar&ed to
accommodate bi&&er) l%/%ry cars$ That the lo&ic (as fla(ed has no( become
evident$ India is still a small"car mar'et for anyone (ho (ants both reven%es and
profits$
Aot s%rprisin&ly) 4ord <(hich la%nched the )G00"cc petrol and the ):00"cc diesel
.scort in BBM>) the SC:$C"billion -eneral Motors <(hich entered (ith the )M00"cc
Epel Dstra in BBM>) and the SC2"billion @ae(oo -ro%pLs Js BMG$GC"crore @ae(oo
Motors <(hich la%nched the )!B:"cc ,ielo in BB#> are limpin& at the startin&"bloc'$
Aone of the G has mana&ed to chal' %p sales of more than :)000 %nits a year$ .ven
Mar%ti =dyo&""a joint vent%re bet(een the S2$2"billion S%5%'i Motor ,orporation of
Fapan and the -overnment of India""has been %nable to &ro( the l%/%ry se&ment$ Dt
:)000 %nits in BBC"B:) its )G00"cc .steem l%/%ry carLs sales fell by 2: per cent$
./plains B$V$J$ S%bb%) !G) @irector <Sales 9 Mar'etin&>) 8y%ndai Motor IndiaP
TTraditional mid"car b%yers are t%rnin& to small carsH they are (aitin& for ne(
technolo&ies$T 6ithin : months of the )!M:"cc ,ityLs la%nch in Fan%ary) BB:) the
S!:$:C"billion 8onda Motor has sold !):0 cars in the Indian mar'et) (hich is more
than the combined sales <G)GC %nits> of the Dstra and the .scort$ B%t despite
8ondaLs initial s%ccess) the l%/%ry"car se&ment has platea%ed) and there seems to
be room for j%st one player$ In the past G years) the se&ment has shr%n' in val%e)
dashin& car"ma'ersL hopes of reb%ildin& their f%t%res in India$ Aat%rally) the only safe
haven that remains is the small"car se&ment) (hich is 2$!# la'h %nits in si5e$ Dnd the
only se&ment e/pected to &ro( at # per cent a year for the ne/t # years$ The ne(
millenni%m cannot b%t belon& to the small car$ 8o(ever) economics of %pstream
man%fact%re (ill only ens%re s%rvival$ Sophisticated do(nstream s'ills are essential
to ma'e inroads into the to%&h Mar%ti =dyo& territory$
BUILDING COMPETITIVE STRATEGIES
B%t strate&ies) li'e cars) m%st feed on vol%mes$ Dnd ho( m%ch is the s%b"compact
se&ment li'ely to yield in BB:"BB7 Mar%ti =dyo& e/pects the sales of the Ken to
cross the "la'h"%nit mar'$ Dss%min& that at least a third of the small"car o(nin&
pop%lation""this incl%des c%stomers (ho have been %sin& the Mar%ti :00) say) for at
least G years""&rad%ates to a s%b"compact that means a mar'et for at least other
la'h cars$ .ven if the 2"la'h mar' is not breached in the ne/t # months) BBB"2000
(ill be the Year of the =p&rade) the economy permittin&$ 6hich is (hy the second
(ave is foc%sed on the small se&ment""from the mini to the s%b"compact to the small
car7 En that relatively stable band(a&on is perched the &oliath) Mar%ti =dyo&) 2
ne(comers""the S2:"billion 8y%ndai Motor of So%th ?orea and the Js C)!#0$G!"
crore telco""and one revitalised company) @ae(oo Motors$ By dra(in& on their
intrinsic stren&ths) each is evolvin& a %ni2%e strate&y to overta'e competition$ BT
test"drives the strate&ic responses of the second (ave and assesses their chances
of s%rvival$
In less than t(o decades) India has ascended the ladder of &lobal competitiveness
and improved its b%siness environment for investors thro%&h a consistent foc%s on
economic reforms$ .ven more creditable is the fact that this &ro(th comes on the
bac' of an ever"stren&thenin& social infrastr%ct%re s%pported by vibrant democracy$
India today is the hotbed of entreprene%rial activity$ 6ealth creators and (orld"
beaters are visible in sectors after sector$ India*s economy has more than do%bled in
real terms since reform be&an in BB$ ,ons%mer demand) increasin& three to five
times faster than the economy) reflects the aspirations of a vibrant) &ro(in& and
yo%n& middle classH India is home to 20 per cent of the (orld*s pop%lation %nder the
a&e of 2!$ 6ith more than 200 television channels offerin& a (indo( to the (orld)
Indians are perhaps the most rapidly evolvin& cons%mers across the &lobe$
S%ccessf%l economic reforms) favo%rable media disposition and an overall positive
economic scenario have placed a spotli&ht on the co%ntry$ Indian companies are
ma'in& overseas ac2%isitions) capital mar'ets are boomin&) 4IIs are p%mpin& money
in) 4EJ.; reserves are a record hi&h and the political economy has &ained
credibility in the &lobal investor comm%nity and (orld media$ Innovative prod%cts)
innovative processes) innovative man%fact%rin& methods are enticin& forei&n
investors and m%ltinationals to India$ 6hat is UIndiaL for the (orld7 It is a millennia"
old civilisation$ It is also the (orldLs premier IT services provider$ The (orldLs bac'
office D &lobal J 9 @ h%b$ .mer&in& small"car h%b$ Jepository) ar&%ably) of the
(orldLs lar&est n%mber of en&ineers) doctors) acco%ntants) and so on$ To brin& it all
do(n to a sin&le idea Q India is ready (ith vario%s to%ch pointsP from nation brandin&
to prod%ct brandin&$ ,ar man%fact%rers every(here are str%c' by India*s en&ineerin&
and desi&n capabilities$ Toyota is plannin& to set %p a research centre in India$
@aimler ,hrysler and -eneral Motors have done that already and 8onda Siel) 4ord
India) Dsho' 3eyland and Mar%ti S%5%'i spend millions of dollars on research and
development activities and it plans to ma'e India a h%b for S%5%'i*s small cars$
#UTURE O# CAR MARKET IN INDIA
The Indian a%tomotive mar'et offers tremendo%s opport%nities d%e to a stron& -@+
&ro(th) increased %rbanisation) an e/pandin& middle class) an %p(ard mi&ration of
disposable incomes and availability of easy financin& options$ The Indian a%tomotive
ind%stry is dominated by t(o"(heelers) (hile cars acco%nt for abo%t 0$C percent of
the total ind%stry$ The potential for &ro(th is enormo%s$
The Indian -overnment*s D%tomotive Mission +lan 200M"20M states that the Indian
passen&er car mar'et is e/pected to reach G million by 20#) ma'in& India as one of
the top 0 car mar'ets in the (orld$ India is also e/pected to remain as the second"
lar&est t(o"(heeler man%fact%rer) the lar&est tractor and three"(heeler
man%fact%rer and the fo%rth"lar&est tr%c' man%fact%rer in the (orld by 20#$ The
main considerations drivin& c%stomer preference are mainly reliability and economy$
INDIA< THE SOON TO BE SMALL:CAR HUB
Small cars constit%te abo%t C: percent of the domestic demand) ma'in& India the
third"lar&est prod%cer of small cars after Fapan and Bra5il$ Therefore) the
&overnment has decided to la%nch a pro&ramme to ma'e India a small car h%b in the
f%t%re Q a recent red%ction in e/cise d%ties from 2! percent to M percent e/cl%sively
for small cars bein& an initiative in this direction$ The major players not present in
this se&ment have also dra(n %p plans for enterin& this se&ment in the near f%t%re$
+layers (ith e/pertise in small car) s%ch as Mar%ti and 8y%ndai) have form%lated
plans for rampin& %p prod%ction capacities$ It is li'ely that (ith the small car vol%me
increase <both d%e to domestic vol%mes and e/ports> in the ne/t decade) domestic
players) s%ch as Tata Motors) (o%ld become stron& &lobal players$
COMMERCIAL VEHICLES TO CONTINUE STRONG GROWTH
This se&ment has sho(n stron& &ro(th over the last # years <at ,D-J of over 20
percent>) and the &ro(th is li'ely to contin%e in the f%t%re as (ell as this is mainly
dependent on economic pro&ress and road"net(or' availability) both of (hich are
&ro(in& at a fast pace in the co%ntry$ Dccordin& to the Aational 8i&h(ay a%thority
estimations) the &ro(th of hi&h(ays is e/pected to proceed at a ,D-J of abo%t M
percent d%rin& 200M"20#) in contrast to a &ro(th of abo%t $2 percent d%rin& B#"
BB#$
The f%t%re is also e/pected to (itness more prod%ct sophistication (ith increasin&
po(er to (ei&ht sol%tions especially for the tr%c' se&ment$ M%ltinationals have
already made an entry in the se&ment (ith MDA) @aimler ,hrysler and Volvo already
present in the mar'et$
INDIA #IRMS VENTURING ABROAD
Man%fact%rin& occ%pies abo%t M0 percent of the total direct overseas investments by
Indian companies in vario%s sectors$ The Indian a%tomotive companies) incl%din&
both Indian E.Ms and (ell as component man%fact%rers) have been investin&
mainly in the domains of for&in& and castin&) partic%larly in .%ropean co%ntries$ So
far) the ind%stry has (itnessed M ac2%isitions <five in 200#>$ The collapsin& a%to
ancillary ind%stry in these re&ions ma'es the deal e/tremely affordable for Indian
companies) providin& them mar'et access and brand enhancement opport%nities in
a ne( re&ion$ Indian companies are also investin& in emer&in& Dsian economies
s%ch as ,hina to establish a ne( so%rcin& base in the re&ion$
G;'>*; *40'6'0-+/ =;*3/&2< 2'4&9-,1 =*&02 ? '402'4&9-,1 R?D >*2/ 0' I,7-*
The a%to component e/ports sector is e/pected to sho( a stron& &ro(th (ith an
estimated ,D-J of G! percent by 20!$ Dll the leadin& E.Ms in the (orld are
already so%rcin& components from India) mainly in steerin& systems) castin&
prod%cts and electrical) s%ch as motors and (irin&) harnesses$
The Indianmar%ti s%5%'i has fo%r major se&ments "" commercial vehicles <,Vs>)
passen&er vehicles) three (heelers) and t(o (heelers$ The mar'et share for each of
these se&ments of the Indianmar%ti s%5%'i) for the year 200G"0!$ Dccordin& to the
Society of Indian D%tomobile Man%fact%rers <SIDM> ) the Indian passen&er vehicle
mar'et has three cate&ories "" passen&er cars) m%lti"p%rpose vehicles <M+Vs>) and
%tility vehicles <=Vs>$ The passen&er car mar'et is f%rther divided into vario%s
se&ments based on the len&th of the car <Jefer to ./hibit II for a detailed description
of the len&th(ise classification of passen&er cars$ The Indianmar%ti s%5%'i (as a
hi&hly protected slo("&ro(th ind%stry (ith very fe( players till the openin& %p of the
Indian economy in BB$ 3o( man%fact%rin& costs) availability of s'illed labor) an
or&ani5ed component ind%stry) and the capability to s%pply in lar&e vol%mes
attracted &lobal a%to majors to set %p their operations in India after the openin& %p of
the sector$ 4or e/ample) 4iat and @aimler,hrysler started o%tso%rcin& their
component re2%irements to India$ 00 percent Indian s%bsidiaries of &lobal players)
li'e @elphi D%tomotive Systems and Visteon ) e/ported components to other parts of
the (orld$
Macroeconomic factors li'e &overnment re&%lations) lo( interest rates) and
availability of retail finance played an important role in the rapid development of
themar%ti s%5%'i in India d%rin& the late nineties <Jefer to ./hibit III for an
%nderstandin& of the impact of the =nion B%d&et on the Indianmar%ti s%5%'i over the
years>$$V The leadin& Indian man%fact%rers are a&&ressively aspirin& to become
Tier"I s%ppliers Q the E.MP aftermar'et ratio in e/ports has chan&ed from G#PM# in
the last decade to C#P2# at present$ Dccordin& to a -overnment of India estimate)
there are !00 lar&e firms in the or&anised sector and abo%t 0)000 firms in the
%nor&anised sector$ The entry of more forei&n companies in the sector is e/pected to
lead to &reater re&%lation) pr%nin& of the sp%rio%s mar'et and the %nor&anised
players ceasin& to be stand"alone companies) and enterin& into either contract
man%fact%rin& or becomin& ancillary %nits$ India is also sho(in& an increasin&
pro(ess in a%tomotive desi&n and development$ -lobal MA,s) s%ch as -M) 4ord)
@elphi) Visteon) etc$) have already set %p their J9@ centres in India$ The main
advanta&e of these centres is the lo( development costs Q it ta'es R#th of the costs
to develop or en&ineer prod%cts in India as compared to &lobal rates$
CASE STUDY O# MARUTI SUZUKI @PVT.A LIMITED
I believe in @r$ ,$ ?$ +rahlad*s concept of findin& val%e at the bottom of the pyramid$
6e are tryin& to increase mar'et penetration thro%&h several innovative schemes$
There is still a very lar&e se&ment of o%r pop%lation (hich cannot afford a car$1
J*17-2) K)*00*&, M*,*1-,1 D-&/90'&, MUL, -, 2""4

Mar%ti =dyo& 3imited is a s%bsidiary of the S%5%'i Motor ,orporation of Fapan and
has been the leader of the Indian car mar'et since its establishment in B:$ Its
man%fact%rin& plants) located so%th of Ae( @elhi in -%r&aon and Manesar) has an
installed capacity of !#0)000 %nits per ann%m) (ith a capability to prod%ce aro%nd
half a million vehicles$ The company has a portfolio of vehicle brands and is listed
on both the Bombay and Aational Stoc' ./chan&es in India$

ESTABLISHMENT O# MARUTI UDYOG LIMITED
Incorporated on 4ebr%ary 2! ) B:$
Mo% si&ned on april ! ) B:2$
3icense and j$v a&reement si&ned on oct%ber 2 ) B:2$
+lants located at -%r&aon ) 8aryana$
8ead office located at Ae( @elhi$
E(nership Q -EI !B$C!I ) SM, #0I ) M.MB4 0$2MI

VISION
0The leader in the Indian Mar%ti S%5%'i) creatin& c%stomer deli&ht and shareholders
(ealthH a pride of India$1
The case LMar'etin& strate&ies of Mar%ti =dyo&L e/amines the mar'et e/pansion
strate&ies adopted by Mar%ti =dyo& 3imited <M=3>) IndiaLs bi&&est carma'er) in
response to intense competition and a decline in sales of its bread"and"b%tter
model " the Mar%ti :00$ M=3 enjoyed a near"monopoly stat%s) %ntil the -overnment
of India liberali5ed the economy in BB$ This led to the entry of forei&n players li'e
8y%ndai) 4iat) Mits%bishi) and Toyota$ .ven Indian a%to players li'e Tata Motors and
Mahindra and Mahindra entered the fray to &ive M=3 to%&h challen&es$ M=3 be&an
to introd%ce ne( models) and %p&rade its e/istin& models in response to mar'et
demand$ 4or instance) the company introd%ced the hatchbac' LS(iftL to shed its
ima&e of bein& a man%fact%rer of lo("cost staid cars$ The case st%dy loo's into ho(
M=3 came bac' from the cr%nch to retain its place as the top carma'er in India$ It
also deals (ith the t%ssle bet(een S%5%'i Motor ,orporation and the -overnment of
India over o(nership iss%es$ The case hi&hli&hts the promotional offers %nderta'en
by M=3 in its 2%est for mar'et dominance and e/amines ho( the company (as able
to mo%ld itself accordin& to the mar'et re2%irements) by enterin& ne( domains and
reachin& o%t to potential c%stomers thro%&h its LTr%e Val%eL and other promotional
offers$
D joint vent%re bet(een the -overnment of India and S%5%'i Motors) a%tomotive
man%fact%rer Mar%ti =dyo& 3imited has the lar&est dealer and service net(or' in
India and commands a M0 percent mar'et share of the Indian car mar'et$ In the F@
+o(er S%rvey for the year 2000) Mar%ti (as ran'ed n%mber one in c%stomer
satisfaction mar'in& the first instance (here a leader in the Indian mar'et (as also
reco&nised as a leader in c%stomer satisfaction$ To help maintain this hi&h level of
c%stomer satisfaction) Mar%ti (as loo'in& for a (ay to speed and streamline
information access to ens%re the possible response to c%stomer iss%es$
SOME SUCCESS STORIES
Japid e/pansion of ,apacity P 4rom 20)000 %nits <one plant> in B:G to
G#0)000 %nits <three plants> in BBB$
Total A%mber of .mployees P #:G: <as of March 2000>
+rod%ctivity P Vehicles per employee increased from # in B:! Q :# to C0 in
BBB"2000
8i&hest val%e added per employee in BB:"BB at Js 2G$M la'hs$
B#$GI attendance$
2$# days of Dvera&e Inventory$
S%&&estions Scheme 9 O%ality circles P ,ost savin&s of Js G$MB cr thro%&h
#2)0#! S%&&estions in BBB"2000$
Innovative %se of IT for increased efficiency ) .ffectiveness of comm%nication
and red%ction of costs$
T6e 'ne( (e needed to be more nimble (hen it comes to information access and
sharin&)T says Jajesh =ppal) &eneral mana&er) IT division) Mar%ti =dyo& 3td$ T6e
had been loo'in& for portal soft(are for o%r intranet to help accomplish this b%t had
not fo%nd any open) fle/ible and cost"effective sol%tions$ 8+ Services (as
instr%mental in pointin& %s to(ard the Microsoft Share+oint +ortal Server$T Mar%ti
had) in fact) been partnerin& (ith 8+ -lobal Services since BBGH and 8+ Services
has provided desi&n and s%pport services for Mar%tiLs net(or'in& infrastr%ct%re as
(ell as providin& assistance in plannin& the mi&ration from Microsoft ./chan&e
Server #$# to ./chan&e 2000$ TThe 8+ Services team %nderstands o%r b%siness and
o%r information technolo&y re2%irements)T says =ppal$ TTheir e/tensive Microsoft
e/pertiseWalon& (ith the information they shared (ith %s abo%t 8+Ls o(n intranet
sol%tion based on Share+ointWenabled the fast deployment of Microsoft Share+oint
+ortal Server and res%lted in a sol%tion that is both fle/ible and cost"effective$T
Mar%ti =dyo& 3td$) a joint vent%re bet(een the -overnment of India and the S%5%'i
Motor ,orporation of Fapan (as India*s lar&est a%tomobile company in 200#$ It
operated in the passen&er vehicle mar'et and man%fact%red affordable and f%el
efficient cars for the Indian masses$ Mar%ti :00 (as its fla&ship small si5ed car and
(as the best sellin& car in India since decades$ In 200#) S%5%'i la%nched their &lobal
car XS(ift* in international mar'ets and later in India$ S(ift (as the first stylish compact
car from the stable of Mar%ti and (as a differentiator from its earlier prod%cts$ The
la%nch of S(ift had bro%&ht Mar%ti in lime"li&ht and vario%s &lobal international
a%tomobile man%fact%rers anno%nced their plans to boost their investments in India
and la%nch competin& cars$ The competition (as e/pected to intensify to &rab the
b%r&eonin& c%stomer base$
The case describes the Indian +assen&er car ind%stry and the presence of Mar%ti in
each of the cate&ories$ It traces the ori&in) &ro(th and evol%tion of Mar%ti and the
role played by S%5%'i in enablin& it to achieve dominance$ The case hi&hli&hts the
&lobal strate&y of S%5%'i and the mar'etin& strate&y of Mar%ti in la%nchin& S(ift$ It
describes the # +*s of mar'etin& aro%nd the la%nch of S(ift in an endeavor to
chan&e the ima&e of Mar%ti as a man%fact%rer of f%el"efficient b%t non"stylish cars
only$ The case finally tal's abo%t the plans of other competitors and their strate&y to
&ain dominance and the plans of Mar%ti to s%stain its dominance in all se&ments$
The e/citement has started b%ildin& at Mar%ti =dyo&Ls plant in -%r&aon) near @elhi)
and amon&st potential car b%yers$ The co%ntryLs lar&est a%tomobile man%fact%rer is
&earin& %p for one of its bi&&est la%nches$ Aot since the la%nch of the Mar%ti :00 in
B:G has the anticipation amon&st its employees) dealers and c%stomers been so
hi&h$ The objet dLattention (e are tal'in& abo%t here is the S%5%'i S(ift) the first tr%ly
&lobal car that the Fapanese man%fact%rer (ill be la%nchin& in the Indian mar'et$
Sched%led to hit the nei&hbo%rhood Mar%ti sho(room in the third (ee' of May) the
S%5%'i S(ift has already &enerated a lot of heat in the a%tomobile mar'et (ith
competitors (or'in& and re(or'in& their mar'etin& strate&ies and c%stomers p%ttin&
their p%rchase decisions on hold$ Yo% may have ca%&ht a fe( &limpses of the
,oncept"S) the desi&n concept car on (hich the S(ift is based) sho(cased at the
2000 D%to ./po$ B%t the ne( S(ift is a lot different and m%ch more practical than
that concept$ 6e thin' this snea'"pee' of the S%5%'i S(ift (ill be able to &ive yo% an
idea of (hat is in store for potential premi%m small car b%yers$
VALUES
c%stomer obsession
fast ) fle/ible and fast mover
innovation and creativity
net(or'in& and partnership
openness and learnin&
The S(ift is considered as S%5%'iLs most attractive and stylish vehicle$ Since la%nch
it has 2%ic'ly &one %p the sales charts to become one of the 20 top sellin& models in
Fapan$ There is a stron& India connection for the S(ift$ 4rom the time S%5%'i
decided to develop this S%permini) as the si5e se&ment is called in .%ropean
mar'ets) the Fapanese company had (or'ed on the desi&n and development (ith
en&ineers from aro%nd the (orld) motorin& enth%siasts and .%ropean desi&ners for
fine"t%nin& the loo's and performance of the car$ 6ith the aim of la%nchin& the car in
India too) 2 Indian en&ineers (or'ed (ith S%5%'i in developin& this &lobal model$
This is one of the fe( occasions that en&ineers from India have been involved in the
development of an international car model$ These en&ineers from Mar%ti have been
part of the S(ift desi&n team for t(o years) and are no( b%sy testin& the the vehicle
in Indian conditions$
The S(ift is S%5%'iLs first (orld car in the sense that it has been desi&ned (ith
.%ropean taste in mind and is bein& la%nched sim%ltaneo%sly (orld(ide$ Both
S%5%'i and Mar%ti are positionin& the car aro%nd traits s%ch as style) modern loo's
and yo%n& attit%de) in addition to the traditional Mar%ti"S%5%'i =S+s of f%el efficiency
and performance$ To that e/tent the S(ift (ill be a depart%re from the e/cessive
foc%s on f%el economy and lo( maintenance that Mar%tiLs other vehicles are 'no(n
for$ 8o(ever) Mar%ti (ill (ant the S(ift to also retain the ima&e of a car that offers
the benefits of f%el efficiency) performance and reliability$ The S(ift co%ld come (ith
a choice of ne( $G litre or $# litre petrol en&ines and may later offer even a diesel
b%rner$ Dltho%&h the pricin& of the S(ift (ill be decided at the time of la%nch in May)
it is li'ely to be at a premi%m to the c%rrent crop of small cars$ Mar%ti is hopin& to
cloc' bi& n%mbers (ith the S(ift and the tar&et a%dience is li'ely to be potential
c%stomers and c%rrent o(ners of the S%5%'i Dlto) Ken and 6a&on J) 4iat +alio and
the 8y%ndai Santro$
Mar%ti =dyo& 3imited*s <M=3> share of the Indian passen&er vehicle mar'et dropped
to belo( #0I in 200!"0# $ The f%t%re of M=3*s lo("cost model " the Mar%ti :00 <M"
:00> " (as at sta'e d%e to the entry of &lobal a%toma'ers into India$ M":00 had
dominated the Indian car mar'et since it (as la%nched in B:!$ The introd%ction of
ne( cars by competitors made the M":00 loo' obsolete as it had not been chan&ed
in any major (ay for over t(o decades$ Dpart from the increased competition) M=3
also had a fe( other problems on its plate$ There (as a delay in settin& %p of a plant
in India for man%fact%rin& diesel en&ines and transmission systems for cars$ The
en&ines for its diesel variants (ere imported from other co%ntries) and there (ere
limits on the 2%antities it co%ld import$ In the mar'et) M=3*s models li'e the Ken) Dlto)
6a&on) and Baleno (ere sho(in& mi/ed res%lts$
6hile Ken) Dlto and 6a&on (ere s%ccessf%l) Baleno failed to live %p to M=3*s
e/pectations$ Its %tility vehicle XVersa* met (ith a disastro%s response from the Indian
cons%mer$ In addition) risin& incomes) the &ro(th in the %sed"car mar'et) and
availability of easier finance options) led c%stomers to shift their alle&iance to other
models from competitors$ To red%ce its e/cessive dependence on a sin&le model <M"
:00>) the company had restr%ct%red the strate&y for the M":00) and planned for
prod%ct %p&rades and ne( prod%ct development$ In t%ne (ith chan&in& c%stomer
preferences) the company la%nched its hatch"bac' model) XS(ift* in May 200#) to
compete (ith 8y%ndai -et5 and 4iat +alio$ M=3 hoped this model (o%ld help the
company shed its lo("cost and simple loo'$
MARKETING STRATEGY O# MARUTI SUZUKI
Mar%ti S%5%'i India 3td$ is a leadin& man%fact%rer of fo%r"(heelers in India$ Born in
B:G (ith the mission to motorise India) Mar%ti (as a joint vent%re bet(een
-overnment of India and S%5%'i Motor ,orporation) Fapan$ It 2%ic'ly &re( into the
lar&est compact car ma'in& company of India and remained so till 200!$ The
company started (ith S%5%'i holdin& the minor sta'es of the company (hile
-overnment of India holdin& the major sta'es$ Ds of present) -overnment of India
has disinvested its sta'es in the company completely) and handed over the
mana&ement of company to S%5%'i Motor ,orporation$ Today) Mar%ti and its
partners employ more than C#)000 employees$ Its man%fact%rin& facilities are
located at t(o locations) -%r&aon and Manesar) both so%th of Ae( @elhi.
PRODUCT STRATEGY
+rod%ct is anythin& that can satisfy h%man needs and (ants$ The prod%ct is a combination
of tan&ible and intan&ible aspects of the prod%cts offered by the man%fact%rer to the
c%stomers$ It can be defined as a b%ndle of satisfactions and dissatisfactions offered by
company to the c%stomers at a point of time$ The prod%ct strate&y of Mar%ti is that its foc%s
is on caterin& the needs of almost all the se&ments$ Mar%ti S%5%'i offers M brands
consistin& of Mar%ti :00) Mar%ti Emni) Mar%ti Dlto) Mar%ti Versa) Mar%ti -ypsy) Mar%ti D Star)
Mar%ti 6a&onJ) Mar%ti Ken .stilo) Mar%ti S(ift) Mar%ti S;!) Mar%ti ?i5ashi) Mar%ti .eco)
Mar%ti .rti&a) Mar%ti -rand Vitara and #0 variants spannin& across all se&ments$ Th%s
company creates prod%cts that are %ni2%e and val%ed and it is attainin& advanta&e either
thro%&h differentiation via ne( feat%res) improved performance) after sales service or
thro%&h cost leadership$
PRICING STRATEGY
The price is the amo%nt a c%stomer pays for the prod%ct$ It is fi/ed after considerin& vario%s
factors s%ch as mar'et share) competition) material costs) prod%ct identity and the
c%stomerLs perceived val%e of the prod%ct$ The b%siness may increase or decrease the price
of prod%ct if other stores have the same prod%ct$ The price decision is very sensitive and for
that special care is to be ta'en to &et the competitive ed&e$ There are vario%s factors to
determine a price of a car) s%ch as mar'et condition) cost inc%rred to b%ild a car) profit by
company) dealer profit$ The company*s pricin& strate&ies are s%ch that every c%stomer can
o(n a car or %p&rade to another one of his or her choice$ The company offered a different
model at a price difference of aro%nd 0)000$ It follo(s a price"point"strate&y (herein they
have prod%cts available in almost all possible price points$
DISTRIBUTION STRATEGY
@istrib%tion strate&y of a firm is a plan created by the mana&ement of a
man%fact%rin& b%siness that specifies ho( the firm (ishes to transfer its prod%cts to
intermediaries) retailers and end cons%mers$ Mar%ti S%5%'i has t(o man%fact%rin&
facilities in India$ Both man%fact%rin& facilities have a combined prod%ction capacity
of !)#0)000 vehicles ann%ally$ Mar%ti has a stron& dealer net(or'$ Infact it (as one
of the very first companies in the co%ntry to %nderstand the importance of after sales
service in hi&h involvement prod%cts li'e cars$ It has the lar&est distrib%tion 9
Service net(or' comprisin& of over !00 sales sho(rooms) over M00 dealer
(or'shops) and B00 D%thori5ed Service Stations spannin& across over B0 cities
%nparalleled in the co%ntry$ It has G0 ./press Service Stations on G0 Aational
8i&h(ays across )G! cities in India$ Most of the service stations are mana&ed on
franchise basis (here Mar%ti trains the local staff$ To increase their reach to r%ral
India) (here settin& %p a complete dealership (as very diffic%lt) they opened
e/tension co%nters (hich are operated by some dealer in the city thereby ens%rin&
increased c%stomer to%ch points (itho%t ris'in& the viability of the dealers.
PROMOTION STRATEGY
The promotion incl%des all comm%nications a mar'eter %sed in the mar'et for his
prod%cts and services to create a(areness) to pers%ade the c%stomers) to b%y and
retain in f%t%re also$ 4or improvement in the position of sales or pro&ress of b%siness
this method is %sed$ The messa&e is &iven to tar&et &ro%p re&ardin& the feat%res
and benefits of the prod%cts or services$ 6itho%t comm%nication) the feat%res)
benefits and schemes (o%ld not be 'no(n to the c%stomers and objectives of
la%nchin& of prod%cts or services and increasin& sales (o%ld not be completed$
6hen comm%nication creates a(areness then only the interest (o%ld be created
and c%stomers (o%ld ta'e the decision for b%yin&$ 4or promotion different methods
of comm%nication can be %sed$ The promotional strate&y of Mar%ti S%5%'i is very
effective$ The company emphasise on road safety and environment friendly
prod%cts$ The company has la%nched road safety mission %nder (hich #)00)000
people (ill be trained in the ne/t three years$ This (ill be done thro%&h t(o channels
" Instit%te of @rivin& Trainin& and Jesearch <I@TJ> and the Mar%ti @rivin& Schools
spread across the co%ntry$ Ef the #) 00)000 people to be trained) at least )00)000
(ill be people from %nderprivile&ed section of society) (ho are 'een to ta'e drivin&
as a profession$ The company has al(ays promoted the concept of TJed%ce) Je%se)
JecycleT <GJLs>$ The company has ta'en help of all the promotional tools li'e radio)
television) road sho(s) print media) (or'shops and seminars to promote their cars
MARKETING STRATEGY THEORY O# MARUTI SUZUKI
@PVT.A LIMITED
The mar'etin& strate&y of the Mar%ti S%5%'i +vt$ 3td$ can be meas%red from the
follo(in& storyP
E##ICIENT PRODUCTION AND DISTRIBUTION CAPABILITIES
F%st three months after it la%nched S(ift) Mar%ti =dyo& 3imited has already sold over
:)000 %nits of the car and added another #)000 ne/t month$ ThereLs a fo%r"month
(aitin& period for the )2B:"cc hatchbac' "" the company claims more than B)000
boo'in&s before the car (as la%nched$ Dnd thatLs even (hile competitors "" ,orsa
Sail) 8y%ndai -et5 and 4iat +alio "" are available off the shelf$ Aot s%rprisin&ly) M=3
no( has a lot ridin& on the carP thereLs over Js !!0 crore <Js !$!0 billion> invested in
the project <Js 2#0 crore"odd is M=3Ls share>$ Aot only is the company hopin& that
the S(ift (ill help e/pand the mar'et for the B"pl%s se&ment <premi%m hatchbac's>)
itLs also co%ntin& on S(ift to ma'e a style statement "" that S%5%'i can deliver &ood"
loo'in& cars on Indian roads$ 4or a company that has been 'no(n more for its val%e"
for"money proposition "" from the :00 to the .steem "" thatLs important$ TItLs not as if
o%r cars (erenLt style statements$ ItLs j%st that (ith S(ift) (e have made a brea'
from the past)T reveals a company official$
The b%55 aro%nd S(ift be&an in @ecember 200! "" five months before its la%nch$ Dll
ne( 6a&on Js and Mar%ti Emnis came (ith stic'ers and s%nshields that proclaimed
TMy ne/t car is a S(ift$T =nli'e most car la%nches) (here the loo' of the vehicle is
'ept %nder (raps %ntil the last possible moment) photos and specs (ere made
available at sho(rooms several months earlier$ Models of the car (ere placed on
hi&h platforms at b%sy intersections in @elhiH (hile cars (ere on display in malls$ TIt
(or's (ell for those (ho donLt have the inclination to really &o to a dealer and chec'
o%t the car)T says a company official$ The la%nch (as sta&&ered over three to fo%r
days in # cities across the co%ntry) coincidin& (ith the (orld(ide la%nch of the car$
M=3 also made &ood %se of its Js 20 crore <Js 200 million> mar'etin& b%d&et$ 4or
the first time) it opted for an in"film placement "" S(ift appeared in the Bolly(ood hit
B%nty D%r Babli) (hich (as released on the same day as the car la%nch) May 2C$
Dnd it trained )000 salespeople "" called Tener&isersT "" to e/cl%sively sell the S(ift$
+erhaps the S(iftLs bi&&est pl%s is its price$ Introd%ced at Js G:C)000 for the base
model) it (as close to abo%t Js #0)000 less than its competitors$ .ven the top"end
version (as Js C0)000 cheaper than the 8y%ndai -et5 -3S$ M=3 does not (ant to
&ive this pricin& advanta&e a(ay$ Dltho%&h it hi'ed prices by Js 0)000 in early
F%ne) advance boo'in&s (ere hono%red at the introd%ctory price$ Dnd since the car
is priced at j%st %nder Js !00)000) @elhi residents pay only 2 per cent road ta/)
compared to ! per cent for a car that costs more than Js !00)000$
S%5%'i Motor ,orporationLs e/pansion plans) (hich set the Fapanese company on a
collision co%rse (ith the &overnment) co%ld t%rn o%t to be a bi& p%sh for the
a%tomobile components ind%stry$ The 2#0)000 cars per ann%m assembly %nit
anno%nced by S%5%'i co%ld res%lt in an investment of %p to Js C)#00 crore <Js
C# billion> by the components ind%stry$ The entire so%rcin& for the vent%re is
proposed to be done locally$ Tho%&h Mar%ti =dyo&) (hich (ill o(n C0 per cent of the
vent%re) is yet to anno%nce its investment in the project) the a%tomobile components
ind%stry e/pects it to be aro%nd Js 2)#00 crore <Js 2# billion>$ Ds every r%pee spent
in a car project needs to be bac'ed by a do(nstream investment of Js G in
components) vendors say the ind%stry co%ld see an investment of Js C)#00 crore$
T6e are very b%llish on this development) tho%&h (e are yet to do o%r calc%lations
on (hat the S%5%'i Motor investment means to %s e/actly)T S%rinder ?ap%r)
chairman of the Sona -ro%p) one of the lar&est vendors of Mar%ti =dyo&) told
B%siness Standard$ Dny ne( demand can be met only by addin& fresh capacity$ TThe
a%tomobile components ind%stry has to ma'e s%bstantial investments in increasin&
capacity to meet the additional demand)T said @ilip ,henoy) director"&eneral) Society
of Indian D%tomobile Man%fact%rers$ Mc?insey 9 ,o had in a recent st%dy said the
Indian a%tomobile component ind%stry had the potential to become a SGG"!0 billion
ind%stry by 20#$ S%5%'iLs e/pansion plans co%ld t%rn o%t to be a bi& p%sh in that
direction$8avin& s%ccessf%lly completed the s%pply of f%el nec' and real a/le for
Mar%ti =dyo& 3td <M=3> vehicles d%rin& last fiscal) Fay Bharat Mar%ti 3td <FBM3>) the
Js !22"crore man%fact%rer of components for a%tomotive applications) is no(
(or'in& on another e/pansion pro&ramme$ The company is also plannin& to set %p a
coatin& facility and additional (eldin& lines$ 4%rther) it has also decided to e/pand its
e/istin& capacity to meet the increased demand of M=3$ TDt present) the company is
(or'in& on a major e/pansion plan for ne( model of Mar%ti YA! and (ill be settin&
%p facilities for man%fact%rin& of the rear a/le in technical collaboration (ith Yoro5%
,orporation) Fapan)T a FBM3 official told the researcher$ 8o(ever) declinin& to
div%l&e the details on investments involved in the e/pansion project and the
implementation sched%le) he said) Tthe details for the finalisation of technical
collaboration and e/pansion project are still bein& (or'ed o%t in constant
cons%ltations (ith Mar%ti =dyo&$ 6e (ill anno%nce them as and (hen they (ere
finalised$T The official said that Mar%ti =dyo& has recorded first ever sales of
!)C2)22 vehicles in its 20 years of operations (ith G0 per cent &ro(th over the
previo%s year$ TE%r performance is mainly attrib%table to performance of M=3) o%r
main c%stomer$ @%rin& last fiscal) (e have recorded an increase of G#$GB per cent in
sales over the previo%s year$T Statin& that the company has already started
commercial s%pplies of f%el nec' to M=3 d%rin& last fiscal) the FBM3 official said the
test trials have been cond%cted for rear a/le and the commercial s%pplies (o%ld start
d%rin& the first half of c%rrent fiscal$ ./pressin& concern over the %nprecedented hi'e
in steel prices) the official said the steel prices d%rin& last fiscal increased by almost
!0 per cent$ Dccordin& to him) red%ction in import d%ty on components)
stren&thenin& of r%pee a&ainst dollar) th%s ma'in& import cheaper) and si&nin& of
free trade a&reement (ith other co%ntries (o%ld f%rther add to the concerns$
THOROUGH PRO#ESSIONAL MANAGEMENT PHILOSOPHY
Fapanese Mana&ement +hilosophy of Team Spirit
,ommon %niform
Epen office
,ommon ,anteen
Epen office Q .asy accessibility ) Speedy ,omm%nication and decision
ma'in&$
Mornin& Meetin&s
Mornin& ./ercises
The %nit sales of the company d%rin& 200#"0M &re( faster than the rest of the
domestic car ind%stry) and (as the hi&hest ever in Mar%ti*s history$ -ross Sales
Jeven%e &re( by per cent over the previo%s year$ Aet +rofit increased by GB per
cent compared to 200!"0#$ The ratio of Aet +rofit to Aet Sales (as B$B per cent
compared to C$: per cent in 200!"0#$ @%rin& the year) (or' on the company*s ne(
vent%res proceeded as per plan$
LATEST #ACULITIES
This state"of"the"art facility) located in Manesar in 8aryana) be&ins (ith an initial
capacity of 00)000 %nits per year$ This (ill be over and above the capability of over
M00)000 %nits a year in o%r e/istin& facility in -%r&aon) 8aryana$ The ne( car plant
at Manesar) to&ether (ith S%5%'i Motor ,orporation*s ne( plant in Sa&ara) Fapan)
has been desi&ned to meet the S%5%'i &ro%p*s &lobal aspirations in the f%t%re$ Ds
s%ch) the Manesar plant comes e2%ipped (ith many sophisticated systems and
processes to ens%re hi&h 2%ality and prod%ctivity on the shop floor$
The company is also committed to %p&radin& facilities at the e/istin& plant in
-%r&aon$ The total investment by Mar%ti and S%5%'i in the ne( car plant) the diesel
en&ine and transmission facility) %p&radation of the e/istin& plant and in la%nchin&
ne( models (ill be close to Js M000 crore$ The other major vent%re Q the diesel
en&ine plant """ is also on co%rse to be&in operations in this calendar year$ The plant
(ill man%fact%re state"of"the"art) $G litre diesel en&ines for cars$ It (ill start (ith an
initial capacity of 00)000 diesel en&ines per year$ This (ill enable Mar%ti*s entry into
the si&nificant diesel car se&ment of the domestic passen&er car mar'et$ These ne(
facilities (ill stren&then the company*s leadership position in the domestic passen&er
car mar'et$ Dt the same time) they symboli5e S%5%'i Motor ,orporation*s contin%ed
commitment to India$
IMPRESSIVE GLOBAL HOLD
The company (ill la%nch a ne( e/port model d%rin& 200:"0B$ This compact car
model) (hile servin& the Indian mar'et) (o%ld be for e/port mainly to .%rope$ The
company (ill tar&et to e/port 00)000 %nits of this model ann%ally$ D fe( months
a&o) S%5%'i Motor ,orporation and Aissan Motor ,ompany decided to (iden the
scope of their &lobal strate&ic alliance$ Ds a first step) they a&reed to collaborate in
man%fact%rin& by %tili5in& the facilities of the company$ In the ne( scenario) India
and Mar%ti have ac2%ired a very important role in this alliance$ The increased scale
of operations on acco%nt of the Aissan contract is li'ely to f%rther improve cost and
2%ality competitiveness at the Mar%ti facilities) (hich in t%rn (ill benefit c%stomers in
the domestic mar'et$ The company shares the -overnment of India*s vision of
ma'in& India a &lobal h%b for compact cars$ 6ith Mar%ti emer&in& as a contract
man%fact%rer for Aissan) India ta'es one step for(ard in reali5in& that vision$
MOST E##ICIENT RESEARCH AND DEVELOPMENT
6hile S%5%'i and Mar%ti remain committed to e/cellence in man%fact%rin&) both
companies are also increasin& collaboration in J 9 @$ S%5%'i Motor ,orporation
sees a major role for Mar%ti in the area of J 9 @ for cars in Dsia$ B%ildin& on the
s%ccess of the S(ift e/perience) (here Mar%ti en&ineers trained in Fapan (or'ed
closely (ith their S%5%'i co%nterparts to desi&n and develop a ne( model) the effort
(ill be empo(er Mar%ti to independently develop cars to s%it preferences of Indian
c%stomers$ The foc%s (ill be on tappin& the vast talent pool available in India and
develop people thro%&h e/tended trainin& at S%5%'i Motor ,orporation) Fapan$ This)
combined (ith a%&mentation of J 9 @ facilities) (ill help Mar%ti ac2%ire a preeminent
position in S%5%'i*s &lobal J 9 @ set"%p$
MARUTIS STARATEGY TO COME UP WITH NEW MODELS
? SURPRISE MARKETERS
The company is aimin& at sales of one million cars per year in 200$ Investments in
ne( facilities and in J 9 @) as o%tlined above) are both part of the strate&y to
achieve the ambitio%s sales &oal$ In addition) the company (ill la%nch a series of
ne( models to be able to attain the one million sale tar&et$ It plans to la%nch five ne(
models in the ne/t five years to meet the needs of Indian c%stomers$ This (ill be
over and above face"lifts of any e/istin& models and la%nch of ne( variants$ To sell
one million cars in a year) the company (ill have to e/pand the net(or' of sales
o%tlets as (ell as service (or'shops across the co%ntry$ This process) (hich
&athered pace in recent years) is li'ely to accelerate in the ne/t fe( years$ Besides
increasin& the n%mber of o%tlets) the company (ill also revamp the 2%ality of
infrastr%ct%re and service at these o%tlets$
GRABBING COMPACT CAR OPPORTUNITY
The company believes that the lo( penetration rate of cars in India and the relatively
lo(er percenta&e of first time b%yers present a tremendo%s opport%nity for &ro(th$
Therefore) the company*s optimism stems from positive macro economic factors)
incl%din& si&nificant -@+ &ro(th) bias to(ards lo(er ta/es) a yo%n& pop%lation)
foc%s on roads and r%ral infrastr%ct%re and &ro(in& cons%merist aspirations$ 3i'e
,hina before it) the Indian car mar'et may be on the threshold of e/plosive &ro(th$
This &ro(th is li'ely to be driven by the entry"level se&ment$ Ever 2# million Indians
have bo%&ht t(o (heelers in the past five years) and (ill boost demand once they
%p&rade to fo%r (heels$ The company) (ith a ran&e of models in the entry level and
compact se&ments) is best placed to tap this opport%nity$ S%5%'i Motor ,orporation
has been the leader of the minicar mar'et in Fapan for over three decades$ It has the
ri&ht technolo&y and the ri&ht prod%cts to tap the compact car opport%nity in India$
The e/pansion of their sales and service net(or') innovative and foc%sed mar'etin&
initiatives) a&&ressive cost red%ction and prod%ctivity improvement pro&rammes)
their tie"%ps (ith re&ional finance companies and ban's to e/pand the reach of
or&anised finance) are all efforts to reach o%t to entry level c%stomers$
SHOWED GREAT SOCIAL RESPONSIBILITY
The company is conscio%s of its responsibility as a corporate citi5en$ @%rin& the
year) the company has e/panded the n%mber and reach of Mar%ti @rivin& Schools
across the co%ntry$ .2%ipped (ith drivin& sim%lators and specially trained instr%ctors)
these schools provide a comprehensive theory"c%m"practical c%rric%l%m modeled on
the best international drivin& schools$ They have been very (ell received) especially
amon& (omen learners$
The recent decision of S%5%'i to set %p a separate joint vent%re for the man%fact%re
of diesel en&ines and a ne( plant had raised concerns that M=3 may not be able to
benefit s%bstantially from any f%t%re e/pansion plans$ 8o(ever) &overnment
intervention before the cr%cial board meetin& to decide on the joint vent%re ass%red
M=3 a s%bstantial C0I sta'e in the joint vent%re for the ne( vehicle man%fact%rin&
plant$ M=3 has been enjoyin& &ood &ro(th in sales this fiscal (ith overall sales in
the Dpr"Ect period &ro(in& by 20$MI YoY to G02:C$ -oin& for(ard too) (e e/pect
M=3 to enjoy &ood sales &ro(th &iven its (ide distrib%tion net(or') hi&h c%stomer
recall and attractive pricin&$ 6e maintain o%r E%t +erformer ratin& on the stoc' (ith
a tar&et of Js!!!$
Mar%ti =dyo& 3imited has led India*s car mar'et for more than a 2%arter of a cent%ry$
4irst established in B:) the company is no( a f%lly"fled&ed s%bsidiary of the S%5%'i
Motor ,orporation$ Its principal activities incl%de the man%fact%re and sale of motor
vehicles and spare parts via a G00"stron& dealer net(or' scattered across India$ The
year 2002 sa( Mar%ti add finance) leasin&) ins%rance) and pre"o(ned car
b%sinesses to its portfolio) increasin& the scale of its operations and promptin& a
revie( of its processes and systems$ Eracle ,ons%ltin& (as en&a&ed to install a
n%mber of Eracle ."B%siness S%ite mod%les and inte&rate them (ith Mar%ti*s
e/istin& systems$ The ei&ht"month project involved mana&in& %p to #0 people)
incl%din& Mar%ti staff) Eracle cons%ltants) and employees of third"party
or&ani5ations$ Eracle also assisted Mar%ti (ith chan&e mana&ement) a critical part
of the process to ens%re 2%ic' %ser acceptance$
GREAT MANAGEMENT CONTROL
+rior to employin& Eracle) Mar%ti %sed a n%mber of home"&ro(n systems to
mana&e its vario%s lines of b%siness$ Many of these disparate systems co%ld not
tal' to each other) re2%irin& staff to enter data m%ltiple times and consolidate
information to &enerate mana&ement reports$ The addition of fo%r ne( b%siness
sectors in 2002 created f%rther press%res) re2%irin& constant monitorin& and h%man
intervention to 'eep the system operatin& across the h%ndreds of locations Mar%ti
serves (ithin India$ To s%pport this &ro(th and improve efficiency) the company
decided to revamp its information technolo&y systems to provide end"to"end visibility
into the or&ani5ation$ 06e (ere loo'in& for a fle/ible) e/pandable system that (as
easy to mana&e)1 said Jajesh =ppal) chief &eneral mana&er) information
technolo&y) Mar%ti =dyo&$ 0This (o%ld red%ce the comple/ity of the IT environment
and o%r reliance on certain people to maintain the systems. Dnd beca%se o%r
b%siness is %nder&oin& a period of rapid e/pansion) it (as important to have a
standard system that co%ld scale easily$1
To minimi5e the impact of the system chan&e on its b%siness) Mar%ti decided on a
phased mi&ration to Eracle ."B%siness S%ite$ Ds a first step) the company decided
to replace its financial) p%rchasin&) and h%man reso%rces systems (ith Eracle
4inancials) Eracle +roc%rement) and a ran&e of Eracle 8%man Jeso%rces
applications$ Eracle ,ons%ltin& (as selected to s%pervise the implementation)
incl%din& determinin& Mar%ti*s re2%irements and developin& a project plan) desi&nin&
the system) deployin& the soft(are) mana&in& the vario%s parties involved) and
providin& post"implementation s%pport$
TIGHT PROJECT MANAGEMENT
Ds (ith all Eracle ,ons%ltin&"led deployments) cons%ltants sat do(n (ith Mar%ti
mana&ers and 'ey b%siness %sers to scope o%t their re2%irements$ D steerin&
committee (as set %p to &%ide the implementation and ens%re cons%ltants had
reco%rse to senior e/ec%tives for advice$ The project plan delineated the
responsibilities of each party and incorporated monthly milestones and testin&
deadlines$ Eracle ,ons%ltin& ens%red a fast) problem"free installation by employin&
Eracle*s B%siness 4lo( DcceleratorsWan implementation approach that levera&es
predefined b%siness flo( templates to red%ce the time and cost associated (ith
application deployments$ D 'ey project challen&e (as interfacin& the Eracle mod%les
(ith Mar%ti*s le&acy systems) incl%din& direct item proc%rement) dispatch systems)
the time card system for attendance) and the 8yperion b%siness intelli&ence
platform$ The inte&ration had to be completed (itho%t any impact on the company*s
b%siness) (hich fre2%ently deals in lar&e vol%mes$ 4or e/ample) Mar%ti &enerates
more than 2)000 invoices each day and any len&thy interr%ptions co%ld have
disastro%s impacts on cash flo( f%rther do(n the line$
GREAT #UTURE PLANS
Dfter the s%ccess of the financials) proc%rement) and h%man reso%rces deployment)
Mar%ti is considerin& e/pandin& its Eracle footprint$ The company is eval%atin&
Eracle Ddvanced S%pply ,hain Mana&ement and Eracle .nterprise Dsset
Mana&ement$ 06e (o%ld li'e to a%tomate s%pply chain mana&ement and inte&rate
this process (ith the Eracle .J+ system)1 said =ppal$ 06e are also loo'in& at lin'in&
more systems (ith Eracle) so (e can access real"time information across all o%r
b%sinesses$ I e/pect Eracle ,ons%ltin& to play a role in f%t%re projects$1
A CRITICAL ANALYSIS O# MARKETING STRATEGY O#
MARUTI SUZUKI
Strate&y and timin& are the 8imalayas of mar'etin&$ .verythin& else is the ,ats'ills$
Dl Jies$ Mar%ti has been s%ccessf%l in capt%rin& the car mar'et beca%se of the
e/cellent prod%ct it has prod%ced$ The mar'et research cond%cted by Mar%ti S%5%'i
sho(ed that Indian cars (ere overcro(ded) (ith t%rbans and sarees to be
accommodated$ The idea (as to create a vol%mino%s compact car$ The 0tall boy*
model (as ta'en from the Dto5 and it (as redesi&ned to meet Indian conditions$ The
car also &ives hi&h milea&e$ The en&ine delivers ade2%ate tor2%e i$e$ the ability to
p%ll loads even at very lo( speeds"""this proves to be very essential for slo( and
traffic"heavy Indian conditions$ The most important is the seatin&) (hich is) hi&h and
&ives 0road command1$
Mar%ti S%5%'i (as competin& (ith Mar%ti S%5%'i in the small car se&ment and it
offered technolo&y that other car ma'ers tho%&ht (as too advanced for the slo(
&ro(in& Indian mar'et$ Mar%ti has no( b%ilt %p a rep%tation s%ch that it is the first
preference of anybody (ho has driven or ridden in it$
The mar'etin& strate&y employed by Mar%ti S%5%'i can be st%died (ith insi&hts into
their ST+ analysis and Mar'etin& Mi/$
PEST ANALYSIS
In order to %nderstand the conditions %nder (hich the Mar%ti prod%cts (ere la%nched
in the Indian mar'et) it*s necessary to analy5e the factors that infl%enced its
effectiveness$
P';-0-9*; C',7-0-',2
Mar%ti S%5%'i entered India (hen liberali5ation (as at its pea'$ Ds a res%lt)
everyone (as very open to the idea of forei&n companies collaboration
<Mar%ti India Y S%5%'i Fapan> settin& %p base in India$
The &overnment insisted on the ,ompanies %sin& C0I local content in the
man%fact%re of the cars as they (o%ld have &enerated tremendo%s reven%e
for India$ Mar%ti S%5%'i achieved this in a very short time$
D positive .;IM policy also has helped Mar%ti S%5%'i to boost its top line (ith
./ports of Mar%ti S%5%'i prod%cts to other co%ntries$
E9','6-9 C',7-0-',2
The economic conditions d%rin& the la%nch of Mar%ti S%5%'i (ere very
rela/ed and liberal$ Mar%ti S%5%'i (as la%nched (hen the co%ntry had j%st
opened its doors to liberali5ation$ So there (ere no strict norms or byla(s that
the company had to adhere by$
The reso%rces available in India (ere %tili5ed by the m%ltinationals <S%5%'i>)
(hich &enerated considerable reven%e for the &overnment$
D boomin& ban'in& sector and a phenomenal &ro(th in D%to 3oans mar'et
has made Mar%ti S%5%'i more affordable$
S'9-*; C',7-0-',2
D rise in Middle class and concept of small n%clear families has propelled a
demand of B"Se&ment cars$ Mar%ti S%5%'i provides an e/act choice for this
demand leadin& to its hi&h &ro(th$
T/9),';'1-9*; C',7-0-',2
Since Mar%ti S%5%'i man%fact%rers everythin& from the smallest of scre(s to the
bi&&est of machines in its factory it is able to maintain the efficiency of the machines$
Mar%ti S%5%'i therefore man%fact%res cars %nder best of conditions (ith the best of
machinery$ Ds a res%lt) the cars man%fact%red are of top 2%ality$
STP $ SEGMENTATION, TARGETING, POSITIONING
Mar'etin& is not an event) b%t a process $ $ $ It has a be&innin&) a middle) b%t never
an end) for it is a process$ Yo% improve it) perfect it) chan&e it) even pa%se it$ B%t yo%
never stop it completely$
S/16/,0*0-',
Se&mentation is based %pon considerable evidence that a sin&le mar'etin&
approach or form%la (ill not (or' for all members of the comm%nity to be served$
G/'1&*=)-9
The re&ion of interest of Mar%ti S%5%'i is (hole India (ith special foc%s on Type D
and fast &ro(in& Type B cities across India$
D/6'1&*=)-9
D&e Q Dnybody of a&e bet(een 20 Q !0 yrs$
Income Q Dnybody (ith an income of over ! la'h p$a$
Ecc%pation Q Millennials employed as professionals) mana&ers and those (ant to
b%y their first car$ Social ,lass Q Middle class) =pper middle) 3o(er =pper and
=pper %ppers$
P239)'1&*=)-9
+ersonality Q @reamers) those (ho (ant to achieve bi&) ambitio%s) price conscio%s)
too' their first step to(ards s%ccess and val%e driven$
B/)*+-'&*;
Benefits Q O%ality) Style) +rice <economical>
=ser stat%s Q +otential %sers and first time %sers
B%yer Q Jeadiness Sta&e Q Those (ho are a(are) informed) interested and intend to
b%y
T*&1/0-,1
In eval%atin& the mar'et se&ments Mar%ti S%5%'i has loo'ed at t(o factors " The
se&ments overall attractiveness and the companies reso%rces$ Ds is very clearly
seen Mar%ti S%5%'i has opted for a selective speciali5ation 'ind of tar&etin&$ Mar%ti
S%5%'i has selected a n%mber of se&ments each objectively attractive and
appropriate$ There is minimal syner&y amon& the se&ments b%t each is a cash co($
This m%lti se&ment strate&y has had the effect of diversifyin& the firm*s ris'$
8avin& Bolly(ood celebrities to endorse its cars paid off for Mar%ti S%5%'i$
Bolly(ood celebrities li'e S%nny @eol as a brand ambassador tar&ets t(o sections of
the society$ 4irstly) his &lamoro%s and sophisticated ima&e appealed to the elite
effectin& their p%rchase decisions$ Secondly) his adorable persona appealed to the
middle class b%yers (ho (anted a &ood car for the Xbi&* investment they (ere
ma'in& and for people (ho (ere &rad%atin& from the second hand car$
The lo( price ta& of Mar%ti S%5%'i initiated a price (ar amon& all companies and
forced Tata Indica to pre"pone its la%nch$ The initial lo( price ta& and stren&thened
by a solid mar'etin& initiatives in form of print advertisements provided a solid
fo%ndation for Mar%ti S%5%'i in India (hich sho(ed in its sales of C000 %nits in j%st
# months$
Mar%ti S%5%'i has identified its tar&et mar'et based on its pricin& strate&y$ S(ift aims
to be the price leader in B"Se&ment cars$ It has al(ays priced its base model lo(er
than Ken or Indica &ivin& all the feat%res (hich they &ive in their hi&her models$ 6ith
a constant chan&e in its positionin& strate&y) Mar%ti S%5%'i S(ift has s%cceeded in
identifyin& its tar&et mar'et every time and emer&in& as the fastest sellin& car in its
o(n se&ment$ 6ith the invent of S(ift) Mar%ti S%5%'i is loo'in& to(ards entire ne(
se&ment of cons%mers and all set to tar&et it to emer&e as the mar'et leader in B"
Se&ment cars$
P'2-0-',-,1
Since its inception) S(ift has %nder&one a lot of chan&es in terms of its positionin&$
4irst it (as S(ift) then S(ift V;I) and then came finally S(ift V@I$

6hen S(ift (as initially la%nched it (as positioned as 0The ,omplete 4amily ,ar1$
Since S(ift (as la%nched in B"Se&ment) it had Santro and Tata Indica as its bi&&est
competitors in that se&ment$ The stylish XTall Boy* @esi&n of S(ift to&ether (ith its
slo&an helped it to position itself as one of the cars to loo' %pon$ 6ith a constant
chan&e in its positionin&) Mar%ti S%5%'i al(ays tried to 'eep alive the b%55
associated (ith S(ift$
Mar%ti S%5%'i repositioned S(ift as 0S%nshine ,ar <smart car for yo%n& people>1
from earlier 0complete family car1$ This (as done beca%se the competitors (ere
comin& o%t (ith similar prod%cts and then Mar%ti S%5%'i started (hat they call as
X.motional +ositionin&*$ This repositionin& of S(ift also helped it to tar&et the
se&ment of first time car b%yers$ .ven the print ads at this time (ere desi&ned in a
(ay to project S(ift as the first car for the fastest &ro(in& cons%mer se&ment of
India at that time) The Yo%n& +rofessionals) of the service ind%stry that combined
(ith vario%s loan facilities (ere too ea&er to b%y their first car$ This led to a
phenomenonal &ro(th in its sales and f%rther stren&thenin& its position as a brand in
cons%mer mind$ Th%s the repositionin& of S(ift &ave it an ed&e over its competitors
and also to emer&e as a to%&h rival to Mar%ti :00 as XThe 4irst ,ar*$
PORTERS #IVE #ORCES MODEL
>arriers to "ntry
6ig$ ca%ital investment reFuired
Strong distribution net'or= of
existing %layers
Strong "rands existing
!conomies of Scale
Threat of ubstitutes
S'itc$ing &ost to substitute is very
lo'
)rice G %erformance Trade off of
substitutes
"rand loyalty does not exist
>argaining power of
uppliers
,o substitute for critical n%uts
S'itc$ing cost from one
su%%lier to ot$er is $ig$
Su%%lier integrating for'ard
for $ig$er %rices and margins
>argaining power of
>uyers
+vailability of many brands
)rice sensitivity
"uyer nformation
)roduct differentiation
Ri?alry among e=isting firms
!xit barrier
ndustry 0ro't$
ndustry &oncentration
Diversity of rivals
)rice com%etition
)roduct differences
SWOT ANALYSIS
STRENGTHS
Brand AameP Mar%ti S%5%'i has emer&ed as a stron& brand name in recent
times$ Bac'ed (ith the parent company Mar%ti S%5%'i this is reco&ni5ed as a
stron& player in (orld(ide a%tomotive mar'et) S(ift has definitely a val%e
associated (ith it any individ%al (ill li'e associatd (ith$
3ar&e @istrib%tion Aet(or'P 6ith a stron& dealer net(or' of aro%nd G000
dealers al aro%nd the co%ntry) Mar%ti S%5%'i has made its presence felt in
each and every corner of India$
6ide +rod%ct offerin&s at different price pointsP Mar%ti S%5%'i has la%nched
vario%s models in vario%s se&ments and hence has a very &ood prod%ct mi/
of offerin&s as different price points$
,heapest cars in respective se&mentsP Mar%ti S%5%'i has al(ays follo(ed an
a&&ressive pricin& policy$ Ds a res%lt it has its cars priced at lo(est possible
rates in respective se&ments$
.nco%ra&in& ./portsP Bac'ed by a stron& prod%ction and a &lobal set%p at
-%r&aon) Mar%ti S%5%'i is e/portin& a lot$ Dn e/port of (orth Js$ )G2# crores
has been achieved in last si/ months$
D(arded Many D(ardsP Mar%ti S%5%'i has been a(arded (ith many a(ards
and reco&nitions li'e 0The Star ,ompany1 amon&st %nlisted companies by
B%siness Standard this year$ Its vario%s models li'e S(ift has achieved many
a(ards) thereby increasin& the brand val%e of the company$
.conomy (ith technolo&yP Mar%ti S%5%'i*s cars have al(ays seen as a
company prod%cin& cars blendin& economy (ith technolo&y$ S(ift*s initiative
of p%ttin& a M"bit microprocessor on board has proved as one of the major
reasons for its s%ccess and that too for the lo(est price in its se&ment$
WEAKNESSES
3ac' of in ho%se J 9 @P Mar%ti S%5%'i does not have a comprehensive J 9 @
department$
Ae( model introd%ction to only cosmetic chan&esP There is no major desi&n
chan&es incorporated in Mar%ti S%5%'i prod%cts$ Enly some cosmetic
chan&es have been made$
@ominance mainly at lo(er levelP Mar%ti S%5%'i dominance in Indian mar'et is
only at its lo(er level se&ments li'e S(ift in B"Se&ment and Dccent n ,"
Se&ment$ It has to foc%s on its %pper se&ment models to stren&then its
position in Indian car ind%stry$
OPPORTUNITIES
Jise of Indian middle class and small citiesP Ds a phenomenonal &ro(th is
seen in recent times in Indian middle class and the p%rchasin& po(er of
(or'in& class individ%als$ Dlso a rise in small cities across the co%ntry has
&iven a &reat opport%nity to Mar%ti S%5%'i for achievin& a hi&her &ro(th rate
in comin& times$
D Boomin& .conomyP Indian economy is &ro(in& at a rate of on an avera&e of
CI every year thereby &ivin& an opport%nity of lar&er sales in each and every
se&ment$
Jisin& e/portsP 6ith a e/port of Js$ )G2# crores in last si/ months) Mar%ti
S%5%'i has a &reat opport%nity of achievin& a e/port tar&et of Js$ 2)C00 crores
in this fiscal year$
THREATS
Many players fi&htin& for the same ca'eP There a many major players in the
B"Se&ment and since the si5e of mar'et is not e/pandin& rapidly) Mar%ti
S%5%'i has a major threat in form of to%&h competition$
.ntry of ne( playersP (ith comin& of Tata Indica and other players plannin& to
come o%t (ith m%ch more models in B"Se&ment) the competition is j%st
&ettin& hotter$
,annibalismP to some e/tent the Ken is affectin& S(ift beca%se of its price$
Th%s Mar%ti S%5%'i has to foc%s more on its positionin& strate&y of Ken and
S(ift$
CONCLUSION
Mar%ti =dyo& 3td$) a joint vent%re bet(een the -overnment of India and the S%5%'i
Motor ,orporation of Fapan (as India*s lar&est a%tomobile company in 200#$ It
operated in the passen&er vehicle mar'et and man%fact%red affordable and f%el
efficient cars for the Indian masses$ Mar%ti :00 (as its fla&ship small si5ed car and
(as the best sellin& car in India since decades$ In 200#) S%5%'i la%nched their &lobal
car XS(ift* in international mar'ets and later in India$ S(ift (as the first stylish
compact car from the stable of Mar%ti and (as a differentiator from its earlier
prod%cts$ The la%nch of S(ift had bro%&ht Mar%ti in lime"li&ht and vario%s &lobal
international a%tomobile man%fact%rers anno%nced their plans to boost their
investments in India and la%nch competin& cars$ The competition (as e/pected to
intensify to &rab the b%r&eonin& c%stomer base$
The Indian car mar'et c%rrently appears to be at a crossroads) (here car mar'eters
are attemptin& to chan&e c%stomer perceptions of their brands and (here specific
b%yin& motivations appear to be replacin& &eneralities$
This mean(hile is 2%ite %nli'e the (est (here b%yers consider aesthetics) comfort
and safety) not necessarily in that order) before finalisin& a p%rchase$ 0It*s smarter to
thin' abo%t emotions and attit%des) if mar'eters are to do a better job of marryin&
(hat a car offers to the cons%mer*s ima&e of the offerin&s$
The mindset of the Indian cons%mer is s%ch that he is deli&hted if he b%ys a pen a
little cheaper than his nei&hbo%r$ Thin&s are) ho(ever) slo(ly chan&in& and
c%stomers at the %pper end of the mar'et are no( ready to pay more for more$ I
hope that this approach (ill soon enter the small car se&ment) maybe not (ith the
same intensity $
0S%ccess (ill lar&ely be determined to the e/tent a company can differentiate itself in
terms of intan&ibles that &o (ith a car1$ Th%s) s%ccess co%ld (ell hin&e on the best of
b%ndle of services that a carma'er can provide$ Mar%ti S%5%'i &re( from 5ero to the
#00)000 mar' and the n%mber Ene sales spot in India in j%st five years$ 3oo'in& at
the present scenario it can be said that tho%&h there is lot of competition in the a%to
(orld Mar%ti S%5%'i is pic'in& %p (ell$
ANNE8URES
O$ 4rom ho( many years yo% are =sin& Mar%ti S%5%'i ,ars7
a> More than 2 years
b> More than # years
c> More than 0 years
O2$ Is ,%stomer price Sensitive7
a> Yes
b> Ao
OG$ 6hat is ,ompetitive Ddvanta&e of Mar%ti S%5%'i over other
cars ,ompanies7
a> +rice
b> O%ality
c> Dfter sales services
d> Ether
O!$ 6hich Version is the ,%stomer +refer more7
a> +etrol
b> @iesel
c> 3+- or -DS
O#$ 6hat is its Sales +osition of Mar%ti S%5%'i7
a> -oin& =p
b> -oin& @o(n
c> Jemains ,onstant
OM$ Dre yo% a(are abo%t the present boom in Mar'et7
a> Yes
b> Ao
OC$ 6hat method do yo% follo( for sell of yo%r prod%cts7
a> @irect sales Method
b> Indirect @ealership Method
c> Both
O:$ 6hich is the major factor to increase the sale of yo%r
prod%cts7
a> Brand
b> @emand S%pply 4actors
c> O%ality
d> Ether 4actors
OB$ 6hich are the prod%cts of the company that are favorite
amon& the c%stomers7
a> O%ality Based
b> .conomical R ,heap
c> Branded
O0$ @o yo% see the probability of a separation bet(een Mar%ti
and S%5%'i in f%t%re7
a> Yes
b> Ao
Aame Q
Si&n Q
+rofession Q
@ate "
BIBLIOGRAPHY
B''.2 ? J'4&,*;2
Mar'etin& Mana&ement by +hillip ?otler
Brand positionin& by S%broto sen&%pta
+ositionin&P The Battle for yo%r mind by Dl Jies 9 Fac' Tro%t
Dhl%(alia) I$F$ <B::>$ TInd%strial +olicy and +erformance in IndiaT in 3%cas)
J$.$B$ and -$4$ +apane' <eds$> <B::>$ The Indian .conomyP Jecent
@evelopment and 4%t%re +rospects$ @elhiP E/ford =niversity +ress) pp$ #"
M2
DIDM <BBB>$ Jecommendations for @evelopin& Indian D%tomotive +olicy$
Dssociation of Indian D%tomobile Man%fact%rers) Ae( @elhi
N/B2=*=/&2, J'4&,*;2 ? M*1*5-,/2
B%siness 6orld
The .conomist
.conomic Times
D%to car India*s