Final Hero

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<p>FORE SCHOOL OF MANAGEMENT</p> <p>Brand Audit report on Hero HondaGroup Submitted To : Freda J Swaminathan 12/18/2010</p> <p>Submitted By :Anika Gupta - 91005 Anmol Sahni 91009 Chinmay Jagga 91013 Neha Arya 91036 Shweta gangwani - 91052</p> <p>1 Brand Audit report on Hero Honda one of the known brands in two wheeler market in India</p> <p>AcknowledgementI have searched for the definition of success, in the context of leading a successful life. It turns out that there are as many definitions as there are seekers and that success lies as much in the attempt as in the achievement. - Robert Frost Feeling gratitude and not expressing it is like wrapping a present and not giving Arthur Ward it. - William</p> <p>First and foremost, I Thank the Almighty God for sustaining the enthusiasm with which I plunged into this endeavor. I avail this Opportunity to express my profound sense of sincere and deep gratitude to many people who are responsible for the knowledge and experience I have gained during the Project Work. I have great pleasure in expressing my deep sense of gratitude to our faculty of Strategic Brand Management, Prof Freda J Swaminathan for her valuable guidance and meticulous supervision during the preparation of this Project Report. I convey my hearty and inevitable thanks to all the respondents who helped me to bring out the project in a successful manner. Last but not the least I extend my gratitude towards my parents, faculties and friends who extended their whole hearted support towards the successful completion of this Project Work.</p> <p>2</p> <p>Table of ContentsHistory ................................................................................................................................................................... 4 Points of Parity ....................................................................................................................................................... 5 Points of Difference................................................................................................................................................ 5 Product Related Attributes ..................................................................................................................................... 6 Brand Portfolio....................................................................................................................................................... 7 Target Consumer.................................................................................................................................................... 7 Competitive Scenario ............................................................................................................................................. 8 Customer knowledge ............................................................................................................................................. 9 Sources of Brand Equity ....................................................................................................................................... 10 Brand Philanthropy .............................................................................................................................................. 14 Branding Strategies .............................................................................................................................................. 14 Communication.................................................................................................................................................... 16 Brand Positioning ................................................................................................................................................. 18 CBBE Pyramid....................................................................................................................................................... 19 Brand Identity Prism............................................................................................................................................. 20 Brand Mantra ....................................................................................................................................................... 21 Research Analysis ................................................................................................................................................. 22 Brand Personality Sketch ...................................................................................................................................... 26 Recommendations ............................................................................................................................................... 27</p> <p>Annexure ................................................................................................................................................................ 28 Timeline for Hero Honda History: Milestones and Achievements.......................................................................... 28 Questionnaire ...................................................................................................................................................... 30</p> <p>References .............................................................................................................................................................. 33</p> <p>3</p> <p>HistoryIn the year 1984, a joint venture was established between Hero Group and Honda Motor Company. Today Hero Honda has an assembly line of 9 different models of motorcycles available. It holds the record for most popular bike in the world by sales for Its Splendor model. It is currently the largest producer of Two Wheelers in the world. The Group's low key, but focused, style of management has earned the company plaudits amidst investors, employees, vendors and dealers, as also worldwide recognition. The growth of the Group through the years has been influenced by a number of factors:</p> <p>1. Just- In- Time The Hero Group through the Hero Cycles Division was the first to introduce the concept of just-intime inventory. The Group boasts of superb operational efficiencies. Every assembly line worker operates two machines simultaneously to save time and improve productivity. The fact that most of the machines are either developed or fabricated in house, has resulted in low inventory levels. In Hero Cycles Limited, the just-in-time inventory principle has been working since the beginning of production in the unit and is functional even till date.</p> <p>2. Ancillarisation An integral part of the Group strategy of doing business differently was providing support to ancillary units. There are over 300 ancillary units today, whose production is dedicated to Hero's requirements and also a large number of other vendors, which include some of the better known companies in the automotive segment. Employee Policy: Another Striking feature within the Hero Group is the commitment and dedication of its workers. There is no organized labour union and family members of employees find ready employment within Hero.</p> <p>3. Dealer Network The relationship of Hero Group with their dealers is unique in its closeness. The dealers are considered a part of the Hero family. A nation-wide dealer network comprising of over 5,000 outlets, and have a formidable distribution system in place. Sales agents from Hero travels to all the corners of the country, visiting dealers and send back daily postcards with information on the stock position that day, turnover, fresh purchases, anticipated demand and also competitor action in the region. The manufacturing units have a separate department to handle dealer complaints and problems and the first response is always given in 24 hours.4</p> <p>4. Quality Quality at Hero is attained not just by modern plants and equipment and through latest technology, but by enforcing a strict discipline. At the Group factories, attaining quality standards is an everyday practice - a strictly pursued discipline. It comes from an amalgamation of the latest technology with deep-rooted experience derived from nearly four decades of hard labor. It is an attitude that masters the challenge of growth and change - change in consumers' perceptions about products and new aspirations arising from a new generation of buyers. Constant technology up gradation ensures that the Group stays in the global mainstream and maintains its competitive edge. With each of its foreign collaborations, the Group goes onto strengthen its quality measures as per the book. The Group also employs the services of independent experts from around the world to assist in new design and production processes.</p> <p>Points of Parity1. Sporty design or look 2. Domestic Company: Just like its closest competitor Bajaj Hero Honda is also a domestic company 3. Target Segment is youth 4. Finance schemes are almost same as competitors 5. Service centres are again a common thing 6. Range of products is similar.</p> <p>Points of Difference1. JIT: Hero is probably the only company to have mastered the art of the just-in-time inventory principle due to Honda access to latest technology. 2. Strong Distribution Network 3. First Mover Advantage : Bajaj was initially in scooters and later on it came into bikes. So Hero Honda has the first mover advantage.</p> <p>5</p> <p>Product Related Attributes</p> <p>Parameters and attributes that play a significant role in swaying customers purchasing behaviors and decisions are: y y y y Lifestyle image Quality engineering Price Service Offerings The lifestyle image includes characteristics like engine capacity, product styling,</p> <p>Lifestyle image:</p> <p>uniqueness, and brand image. Together these attributes create the lifestyle image that represents one significant parameter that often sways customers purchasing decisions rather more than functional attributes. Price: Affordable price is another parameter the current target market looks for. The typical consumer for Hero Honda bikes is in the 21 to 35 age group olds. This age group is interested in their image along with a consideration for price on account of the lack of disposable income. Quality engineering and Service offerings: These two attributes can be related as a pair because if the engineering quality is poor, then the consumer will presume that they need a great deal of maintenance, and hence Hero Honda should provide those services for the product purchased from them. Hero Honda stands out in all the above attributes as it provides bikes for different requirements of consumer, ranging from CD Deluxe for rural farmers, low income group to Karizma for the urban youth. The product portfolio of Hero Honda meets all consumer requirements keeping in mind the above identified attributes of lifestyle image and price. As for the other two, quality engineering and Service offerings, Hero Honda focuses on high quality in all its products which is ingrained through Discipline of quality in all its three plants. According to The Economic Times Brand Equity India s most trusted brands survey, Hero Honda stands atrank 33.</p> <p>6</p> <p>Brand Portfolio</p> <p>Hero Honda CD Dawn Hero Honda CD-Deluxe Hero Honda Splendor Plus Hero Honda Splendor NXG Hero Honda Super Splendor Hero Honda Passion Plus Hero Honda Passion Pro Hero Honda Glamour Hero Honda Glamour PGM F1 Hero Honda Achiever Hero Honda CBZ Xtreme Hero Honda Hunk Hero Honda Karizma Hero Honda Karizma ZMR Hero Honda Pleasure</p> <p>Target Consumer</p> <p>Hero Honda has a wide range of bikes targeting a wide customer groups, contributing to bottom line and competing with competitors. Splendor Target Market Entry level, Middle income group bike CD Target Market Passion Target Market Glamour Target Market </p> <p>Entry level, Lower Tier I city, Middle 2nd bike purchaser, Income group bike income group bike Middle income group</p> <p>Splendor (basic Model Super (auto start)</p> <p>Plus</p> <p>CD Dawn (basic Passion Plus (basic Glamour bike) model) model)</p> <p>(basic</p> <p>Splendor</p> <p>CD Deluxe (old Passion Pro (Sporty Glamour PGM F1 splendor look alike) look)</p> <p>7</p> <p>Flankers Flanker brands are called fighter brands and are positioned with respect to competitors brands so that more important flagship brands can retain their desired positioning. Fighter brands need to be designed in such a way that they should not eat away from their higher priced comparison brands or referents and it must be designed so cheaply that they reflect poorly on these other brands. Example Passion--Glamour-Achiever</p> <p>Cash Cows Some brands may be kept around despite dwindling sales because they manage to hold on to a sufficient number of customers and maintain their profitability with virtually no marketing support. These cash cow brands can be effectively milked by capitalizing on their reservoir of existing brand equity. Example - CBZ xtreme, Hunk, Splendor</p> <p>Low End Entry level The role of low-priced brand in the brand portfolio often may be to attract customers to the brand franchise. Example - CD Dawn &amp; CD Deluxe</p> <p>High-End Prestige The role of a relatively high-priced brand in the brand family often to add prestige and credibility to the entire portfolio. Example - Karizma ZMR</p> <p>Competitive ScenarioMajor competitors of Hero Honda include Bajaj, Yamaha, TVS, Royal Enfield, Harley Davidson. Bajaj is the immediate competitor other players being either niche players or having very small market share. Bajaj Auto Ltd. There has been a long history of rivalry between these two companies. While Bajaj has been the market leader in scooter segment it went into motorcycle segment because of the declining demand of scooters. BAL offers a large variety of products which are mainly positioned on the basis of high mileage and low8</p> <p>maintenance. T was only recently when Bajaj launched Pulsar that it repositioned itself as more stylish and powerful. This was to put itself in competition with Hero Hondas CBZ. Pulsar gained a lot applauses for the company and gave it a new revamped image. Hero Honda reverted by launching variants of CBZ, Karizma and recently Hunk. Yamaha Motors Ltd. Yamaha is an other major player in this market who is known for its imported technology and high speed bikes. But the offered product range lacks depth and breadth. But Yamaha recently marked it presence by launching FZ series in direct competition with Bajajs Pulsar and Hero Hondas Karizma to tap youth market. While Hero Honda has strong association with Style and Design, Bajaj is known for reliability and high mileage. Yamaha at the same time offers sporty bikes with speed and adrenaline rush. Honda motorcycle and Scooter India With a recent speculation of splitting of Honda motorcycle and Scooter India from Hero group, there are good chances that Honda emerges as a strong competitor against Hero group with its high quality technological base. As per recent media news, HMSI has chalked out aggressive expansion plans and is steadily going out ahead with its...</p>