hero motocorp - a rural outlook
TRANSCRIPT
Hero MotoCorp- A Rural Outlook
Abhishek Naik (P14037)Kakoli Laha (P14026)
Shashank Buddhavarapu (M14019)
About Hero• Incorporated as Hero Honda Motors Ltd in 1984 • Mr. Brijmohan lall Munjal (Chairman), Mr.
Pawan Mujal (CEO)• JV between Hero Group and Honda Motor
Company (HMC) of Japan• The world's largest manufacturer of two-
wheelers since 2001• Ended the JV in 2010• Leading manufacturer of motorcycles and
scooters in India
About HeroDerives around 60% of its revenue from rural
areas as compared to approximately 45% for the industry as a whole
About Rural
Automobile sector-RuralThe rural market contributes approximately
45% of the total industry demandOnly 10% of the households own a two-
wheeler in the rural areas
Demographics
About Hero Motocorp Started a separate 'rural vertical‘
in December 2007 Started sales, servicing, and
spare part outlets in several small towns and villages
Recruited local people as rural sales executives, trained them to market products to rural consumers
Extensive presence in rural India; 100,000+ villages covered
DISTRIBUTION "Hub and Spoke System" of
distributing products in rural areas
Dealership to one dealer who takes care of a district.
Hero Motocorp Rural Strategies
Brand Displays in various Hariyali Kissan Bazaar Centres across UP, MP, Haryana and Punjab
Genuine Spare Parts Programs Camps held in association with
Monsanto, Godrej Aadhar, IFFCO etc.
Use of IT to capture details of sales in rural markets
Identify customer mix, demand forecast, enhanced coordination with distribution partners
Splendor, Splendor Plus & Splendor PRO
Har Gaon Har Aangan and Service Har Jagah Programs
Results - • Covered
1,30,000 villages
• Increased Awareness
• Increased buy-in for products
Method• Meeting customers/
opinion leaders• Free check up bike camps/
Loan melas• Test ride camps• Ride Safe Program to
educate customers on Safety & Maintenance
Objectives• To reach every Indian home and every Indian
village• To build long-lasting relationships with people • Ensuring purchase and service of two wheelers in
India is affordable and convenient• Implement with the help of over 2000 channel
partners in villages with population of up to 2000
Other Notable Programs Dhadkanon Ki Rally - The Queen’s Baton program passed through 124 cities using Karizma ZMR
bikes To compensate for this, a massive rural activation campaign ‘Dhadkanon Ki
Rally’ was started across 22,000 villages, touching more than 2 million people
Khushiyan Har Angan – Undertaken to celebrate the spirit of caring and sharing during Diwali Rural executives travelled to 56,932+ villages in 2 weeks Met 4,58,000+ people at their doorsteps and wished them personally Distributed branded box of sweets with diyas
Good Life Program – Provides magnetic card with special rewards Free riders’ insurance worth Rs. 1 Lakh Points on all workshop and showroom spends can be redeemed at stores or
on their website
Other Notable Programs
Saral Finance – Tie-up with Cooperative and
Grameen banks Best rates, easy
documentation Shwet-Labh – Specially designed loan
package for Milk Cooperative members
Competitors’ Rural Marketing Strategies
Bajaj Auto Rural Marketing Strategies
• Special Finance Scheme for Rural customers, even if they have no bank account• Appointed 135 dealers in small towns and mini metros where it had only 25 dealers• Rural customers can schedule their repayment according to crop cycle rather than monthly instalments• Extensive market research surveys conducted• According to results obtained from these surveys, company now focusing on manufacturing bikes with higher power and larger wheelbase
Honda Rural Marketing Strategies• CD 110 Dream at a competitive price tag of ₹ 41,000 launched specially with rural markets in focus• The company hopes to cash in on the brand value of the CD Series• When it comes to service, the customer is not willing to go beyond 10 kilometres- a study by Honda• The ‘Service-on-Wheels’ initiative has catered to above one lakh customers• To take this forward as a planned activity on a monthly basis, the company recently launched a mobile service van• The van will be equipped with audiovisual equipment, washing facilities, generator sets and a training work base• The AV equipment allows the company to have a class and conduct private workshops through videos
SourceSociety of Indian Automobile Manufacturers
(SIAM)http://www.ibef.org/industry/india-automobiles.aspxCRISILhttp://www.heromotocorp.com/en-in/uploads/Annual_Reports/pdf/20140708105458pdf291.pdfHero Honda Annual Reportshttp://www.heromotocorp.com/en-in/investors/annual-reports/2013-2014-50.html