market mix chapter 1-5 revised (1)

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1

INTRODUCTION

India is the second largest producer of two wheeler in the world. In the last few years, the

Indian two wheeler industry has been spectacular growth. The country stands next to China and

Japan in terms of production and Sales respectively.

Majority of Indians, especially the youngsters prefer motorbikes rather than cars.

Capturing a large share in the two wheeler industry, bikes and scooters cover a major segment.

Bikes are considered to be the favorite among the youth generation, as they help in easy

Communication.

Large varieties of two wheelers available in the market, known for their latest technology

and enhanced mileage. Indian bikes, scooters and mopeds represent style and class for both men

and women in India

The study and analysis of Two-wheeler in Hero Two-wheeler company as the main

theme them of study.

Today‘s business operates in highly competitive environment. Marketing is most

dynamic and challenging function of modern business at this changing preference of people, the

business organizations are trying to attract customers at the possible extant. Companies are

creating new ways and tools to make the public know about their products.

Within in this exchange transaction customers will only exchange what they value

(money) if they feel that their needs are being fully satisfied; clearly the greater the benefit

provided the higher transactional value an organization can charge.

Marketing objectives, goals and targets have to be monitored and met, Competitor

strategies analyzed, anticipated and exceeded. Through effective use of market and marketing

research an organization should be able to identify the needs and wants of the customer and tryto delivers benefits that will enhance or add to the customer‘s lifestyle. While at the same time

ensuring the satisfaction of these needs results in a healthy turnover for the organization.

Philip Kotler defines the marketing as ‗Satisfying needs and wants through an exchange

processes.



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NEED FOR THE STUDY

The main basic reason to the study the marketing mix strategies in Organization are to

evaluate the extent of satisfaction attained by the customer and the extent of fulfillment of needs

and wants of the customer.

Discounts and offers are one of the important tools of the sales promotional Strategy. The

study involves important that the discounts and offers have on the company in terms of Sales

Revenue, Market Share, Competitive advantage, Increase in Sales, attracting the Competitive

customers.

Hero Moto Corp Ltd. (formerly Hero Honda Motors Ltd) is the world‘s largest two

wheeler manufacturer based in India* World‘s No.1 two wheeler company in terms of unit

volume sales in a calendar year.* The company was a joint venture between India‘s Hero Group

and Honda Motor Company, Japan that began in 1984 later in 2011 it turn into Hero Motors

Limited.

Today, every second motorcycle sold in the country is a Hero bike. Every 30 seconds,

someone in India buys Hero splendor which is India‘s selling motor cycle.* A popular

advertising campaign based on the slogan Fill it - Shut it - Forget it that emphasized the

motorcycles fuel efficiency helped the company grow at a double-digit pace since inception. The

technology in the bikes of Hero for almost 26 years (1984 – 2010) has come from the Japanese

counterpart Honda

The Company‘s growth in the two wheeler market in India is the result of an intrinsic

ability to increase reach in new geographies and growth markets. Hero Monocarps extensive

sales and service network now spans over to 5000 customer touch points. These comprise a mix

of authorized dealerships, service & spare parts outlets and dealer-appointed outlets across the

country.



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OBJECTIVES OF THE STUDY

To analyze the marketing mix strategies of vara lakshmi motors ltd.

To analyze the products range and pricing strategies at vara lakshmi motors ltd.

To estimate the customers perception among major competitive brands analyzed.

To analyze the consumers purchasing power and buying behavior.

To analyze the various promotional strategies at vara lakshmi motors ltd.



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RESEARCH METHODOLOGY

Methodology can prepare to the theoretical analysis of the methods appropriate to a field

of study or to the body of methods and principles to branch of knowledge.

A body practices, procedures, and rules used by those who in a discipline or engage in an

enquiry the branch of philosophy that analysis the principles and procedures of enquiry in a

particular discipline.

DATA COLLECTION METHODS:

• PRIMARY SOURCES

• QUESTIONNAIRES

• SECONDARY SOURCES

DATA COLLECTION:

The data for the study has been adopted to collect data from the primary sources,

Secondary sources.

PRIMARY SOURCES:

Various techniques have been adopted to collect data from the primary sources.

QUESTIONNAIRES:

A well structured Questionnaire was developed for customers to extract information.

SECONDARY SOURCES:

To trace the origin, growth and performance of Hero the company‘s internal survey

record material, and business magazines, broachers and milestones are utilized.



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LIMITATIONS OF THE STUDY

1. The scope has been confined to vizianagaram and surrounding areas.

2.

The perceptual bias or attitude of respondents may also hurdles to the study.

3. The size of the sample is not consistent to the total customers.

4. Time is another major contrasting factor, as the project done in a time period of 40 days.



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Frame Work of Study:

Chapter 1: It deals with introduction, need for the study, and objectives of the study,

methodology and limitations.

Chapter 2: It deals with industry profile of two- wheeler industry and company profile Sri vara

Lakshmi motors pvt Ltd, vizianagaram.

Chapter 3: It deals with theoretical frame work of study, about employee welfare measures.

Chapter 4: It deals with data analysis, tabulation and interpretation of the project study.

Chapter 5: It deals with findings and suggestion of the study.



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Indian two wheeler industry

The two wheeler industry (hence forth TWI) in India has been in existence since

1955. It consists of the segments viz., scooters, motor cycles and mopeds. The increase in sales

volume of this industry is proof of its high growth. In 1971, sales were around 0.1 million units

per annum. But by 1988, had risen to 3 million units per annum.Similarly, Capacities of

production have also increased from about 0.2 million units of annual capacity in the seventies to

more than 4 million units in the late 90‘s.

The TWI in India began operations within the frame work of the national industrial

policy as espoused by the industrial policy resolution of 1956. This resolution divided the entire

industrial sector into three groups, of which one contained industries whose development was the

exclusive responsibility of the state and the private sector could be developed exclusively under

private initiative within the guidelines and the objectives laid out by the five year

plans(CMEI,1990).

Private investment was canalized and regulated through the extensive use of licensing

giving the state comprehensive control over the direction and pattern of investment. Entry of

firms, capacity expansion, choice of product and capacity mix and technology were all

effectively controlled by the state in a bid to prevent the concentration of the economic power.

However, due to lapses in the system, fresh Policies were brought in at the end of the sixties.

These consisted of MRTP of 1969 and FERA of 1973, which were aimed at regulating monopoly

and foreign investment respectively. Firms that they came under the preview of these acts were

allowed to invest only in a select set of industries.

This set of controls on the economy in the seventies caused several firms to-

Operate below the minimum scale of efficiency(henceforth MES)

Under-utilize capacity, and

Use outdated technology.

Low manpower



8

While operations below MES resulted from the fact that several incentives were given to smaller

firms, the capacity under utilization was the result of

(a) The capacity mix being determined independent of the market demand.

(b) The policy of distributing imports based on the capacity, causing firms to expand beyond

levels determined by demand so as to be eligible for more imports.

Use of outdated technology resulted from restrictions placed on import through the

provisions of FERA. Recognition of the deleterious effects of these policies led to the initiate of

reforms in 1975, which took on a more pronounced shape and acquired wider scope under the

new economic policy (NEP) in 1985. As part of these reforms, several groups of industries were

de-licensed and broad banding was permitted in select industries. Control over capacity

expansion was relaxed through the specification of the MES6 of production for several

industries. Foreign investment was allowed in select industries and norms under the MRTP act

were relaxed. These reforms led to a rise in the trend rate of growth of real GDP from 3.7% in

the seventies to 5.4% in the eighties. However the major set of reforms came in 1991 in response

to a series of macroeconomic crises that hit the Indian economy in 1990-91. Several industries

were deregulated, the Indian rupee was devaluated and made convertible on the current account

and tariff replaced quantitative restrictions in the area of trade. The initiation of reforms led to a

drop in the growth of real GDP between 1990-92, but this average at about 5.5% per annum after

1992. The decline in GDP in the years after reforms was the outcomes of devaluation and the

concretionary fiscal and monetary. Policies in 1991 to address the foreign exchange crisis. Thus

the industrial policy in India moved from a position of regulation and right control in the sixties

and seventies to a more liberalized one in eighties and nineties.

The two-wheeler industry in India has, to a great extent been shaped by the evolution of

the industrial policy of the country. Regulatory policies like FERA and MRTP caused the growth

of some segments in the industry like motorcycles to stagnate. These were later able to grow

(both in terms of overall sales volumes and number of players) once foreign investments were

allowed in 1981. The reforms in the eighties like ‗broad building‘ caused the entry of several

new firms and products, which caused the existing technologically, outdated products to lose



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sales volume exit the market. Finally, with liberalization in the nineties, the industry witnessed a

proliferation in brands.

A description of the evolution of the two wheeler industry in India is usefully split up

into four 10 periods. This division traces significant changes in policy making. The first time

period 1960-1969 was one during which the growth of the two-wheeler industry was forecasted

through means like permitting foreign collaborations and phasing out of non-manufacturing

firms in the industry . The period 1970-1980 saw state control, through the use of the licensing

system and certain regulatory acts over the economy, at their peak.

During 1981-1991 significant reforms were initiated in the country. The final time –

period covers the period 1991-1999 during which the reforms process was deepened. These

reforms encompassed several areas like finance, trade, tax, industrial policy etc., we now discuss

in somewhat greater detail the principle characteristics of each sub periods.

A) 1960-1969

The automobile industry being classified as one of importance under the industrial

policy resolution of 1948 was therefore controlled and regulated by the govt. In order to

encourage manufacturing, besides restricting import of complete vehicles, automobile assembler

firms were phased out by 1952 (Tariff commission, 1968), and only manufacturing firms

allowed continuing. Productions of automobiles were licensed, which meant that a firm required

a licensing approval in order to open a plant. It also meant that the govt. determined firm‘s

capacity of production. During this period, collaborations with foreign firms were encouraged.

Table 1 illustrates the fact that most firms existing in this period had some form of collaboration

with foreign firms. Table 1 also gives the details of the various firms that existed in the industry

during this time period and the products they manufactured.

B) 1970-1980

This was a period during which all the overall growth rate of the two wheeler industry

was high (around 15% per annum). Furthermore, the levels of restriction and control over the

industry were also high. The former was the result of



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The steep oil price hike in 1974 following which two-wheeler became popular modes of personal

transport because they offered higher fuel efficiency over cars/jeeps. On the other hand, the

introduction of regulatory policies such as MRTP and FERA Resulted in a controlled industry.

The impact of MRTP was limited as it effects only large firms like Bajaj auto Ltd. whose growth

rates were curbed as they came under the purview of this act. However, FERA had a more far-

reaching effect as it caused.

Foreign investment in India to be restricted. In the motorcycles segment FERA did not because

technological stagnation, as consequence of which, new products nor firms entered the market

since this segment depended almost entirely on foreign collaborations for technology. The

scooter and mopped segments on the other hand were technologically more self-sufficient and

thus there were two new entrants in the scooter segment and three in the moped segment.

C) 1981-1990

The technologically backwardness of the Indian two-wheeler industry was one of the

reasons for the initiation of reforms in 1981. Foreign collaborations were allowed for all two-

wheelers up to an engine capacity of 100cc. This prompted a spate of new entries into the

industry (Table 1) the majority of which entered the motor cycle segment, bringing with them

new technology that resulted in more efficient production processes and products. The variety in

products available also improved after ‗broad banding‘ was allowed in the industry in 1985 as a

part of NEP. This, coupled with the announcement of the MES of production for the two-wheeler

industry, gave firms the flexibility to choose an optimal product and capacity mix which could

better incorporate market demand into their production strategy and there by improve their

capacity utilization and efficiency. These reforms had two major effects on the industry. First

licensed capacities went up t 1.1 million units per annum overshooting the 0.675 million units

per annum target set in the sixth plan. Second, several existing but weaker players died out

giving were to new entrants and superior products.

D) 1991-1999

The reforms that began in the late seventies underwent their most significant change in 1991

through the liberalization of the economy. The two-wheeler industry was completely



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deregulated. In the area of trade, several reforms were introduced with the goal making Indian

exports competitive. The two wheeler industry in the nineties was characterized by

• An increase in the number of brands available in the market which caused firms to

complete on the basis of product features.

• Increase in sales volumes in the motorcycles segment via the scooter segment

reversing the traditional trend.

The period between 1998-201 is considered to be significant in the history of Indian two

wheeler industries, as it saw and end of at least three alliances. First to go was that between

Kinetic and Honda. In November 1998, after protracted negotiations, in which Honda tried to

take over completely, and the firodias refused to surrender, Honda sold its shares to the Kinetic

Group. In 2000, Yamaha and escorts parted ways with the Nandas-controlled escort group

selling shares to the Japanese manufacturer. During this period, the TVS group and Suzuki

Motorcycle parted ways.

AWARDS & RECOGNITIONS

Year

2011

Two wheeler manufacturer of the year award by bike India magazine. Adjudged the

―Bike manufacturer of the year‖ at the economic times

“Most recommended two wheeler brand of the year” by CNBC Awaaz Consumer

awards.

Ranked no 1 brand in the Auto (two wheelers) category in the Brand equity ―MOST

TRUSTED BRAND‖ 2011 Survey

2010

Company of the year awarded by Economic time‘s awards for corporate excellence

2008-09.



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CNBC TV 18 overdrive awards 2010 ―Hall of Fame‖ to splendor.

2009

“Two wheeler manufacturer of the year” by NDTV profit car & bike awards 2009 and

passion pro adjudged as CNB viewer‘s Choice Two wheeler.

―NDTV Profit business leadership Awards 2009” – two wheeler category.

2008

Top gear design awards 2008- Hunk bike of the year award

―NDTV Profit business leadership Awards 2008” – two wheeler category.

2007

Overall “BIKE OF THE YEAR”- CBZ X-treme

“BIKE TECHNOLOGY OF THE YEAR ‖- Glamour PGM FI.

2006

Adjudged 7th top Indian company by Wall Street Journal Asia (Top Indian two Wheeler

Company).

No.1 in automobile industry by its TNS corporate Social Responsibility Award.

2005

Awaaz Consumer Awards 2005-India‘s most preferred two-wheeler brand by CNBC in

the ‗Automobiles‘ category.

ICWAI National Award for Excellence in cost Management 2004 in the private sector

category by ICWAI

10th Motilal Oswal Wealth Creator Award for as the most consistent wealth creator for

the period 1991-2005.



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2004

Winner of the review 200- Asia ‗companies award (3rd Rank amongst the top 10 Indian

Companies).

Adjudged as the Best Value creator- Large size companies 2003-04 by the outlook

money.

Corporate excellence award 2004 by Indian Institute of Materials Management.

ICSI National Award for excellence in Corporate Governance 2004 by the institute of

Company Secretaries of India.

2003

Winner of the Review 200-Asia‘s Leading Companies Award (3rd Rank amongst the top

10 Indian companies).

Most Respected Company in Automobile sector by Business world.

Bike maker of the Year by Overdrive Magazine.

1999

National Productivity Award for the Best Productivity Award in the Category of

Automobile & Tractor presented by Vice president of India.

1995

The analyst Award 1995 presented to Hero Honda ltd. On Being ranked 9th

amongst the

most investor rewarding companies in India.

1991

Economic Times – Harvard Business School Award for Corporate Performance to Hero

Honda Ltd.,



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PROFILE OF THE DEALER

Sri Varalakshmi motors pvt.ltd.is one of the biggest hero Honda showroom in

the vizianagaram district. It is existed head quarters (vizianagaram) and the heart of the

city. It has been established in 2005 28th

Aug as hero authorized dealer Mr. Rama venkata

reddy is the managing director of the company.

Sri Varalakshmi motors pvt.ltd. Is selling around 1000 vehicles per year and

around 50 employees are working in the company. Marketing and sales department has

one marketing manager, 2 marketing executives and 5 members of sales team.

Sri Varalakshmi motors pvt.ltd. Has a huge automates Work shop for servicing of

the vehicles. Daily around 50 vehicles and services and repaired in the servicing centre.

Workshop has one service manager, Technical supervisor and skilled mechanics.

Sri Varalakshmi motors pvt.ltd. Has linked with HDFC, ICICI To finance the

customers who wish to buy the vehicles in Finance. Monthly the company maintenance

300 vehicles as opening stock and sell 250 vehicles. The company authorities invested 2

cores to shape the company.

CONSUMER FACILITIES AT SERVICING CENTER

1. Automated workshop

2. Quick service

3. Breakdown servicing

4. Lounge for customers

5. Phone

6. Restroom

7. Free replacement and split pin and tube cap



15

8. TV with cable

9. RTA approved pollution checkup

10. Free drop facilities

Services offered

The service offered to the customers in the Sri Varalakshmi motors pvt.ltd.

1. 3 free services and paid services after sale of motorcycle

2. Free checkup campaign

3. Finance through banks

4. Demonstrations of new products

5. Acceptance of Warranty from claim.

Products available at Sri Varalakshmi motors pvt.ltd.

Sri Varalakshmi motors pvt.ltd. Franchise of Hero Honda Company. Herohonda

Company manufactures various types of motorcycles.

They are

1. Hero Honda ambition

2. Herohonda cbz-xtreme

3. Herohonda cd deluxe

4. Herohonda cd dawn

5. Herohonda glamour

6. Herohonda glamour 125 PGM fi



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7. Herohonda hunk 150

8. Herohonda Karizma

9. Herohonda Karizma ZMR

10. Herohonda passion plus

11. Herohonda pleasure

12. Herohonda passion pro

13. Herohonda splendor NXG

14. Herohonda Splendor plus

15. Herohonda Super splendor 125

16. Hero impulse

17. Hero Maestro

18. Hero Ignitor

Employers in Sri Varalakshmi motors pvt.ltd

Sri Varalakshmi motors pvt.ltd. Headed by managing director. It has various

departments- Accounts department, Sales department, Spares department and workshops.

Total employees in Sri Varalakshmi motors are around 65 members in various

departments.

SALES:

Sales of the Sri Varalakshmi motors are higher than any other two-wheeler

company in vizianagaram.



17

YEAR NO.OF UNITS

2005-2006 2223

2006-2007 3938

2007-2008 4149

2008-2009 4983

2009-2010 5185

2010-2011 5608

2011-2012 5235

In its workshop, daily 70 to 80 customers are servicing their vehicles. The workshop‘s

per day Income is about Rs. 15000 to Rs. 35000.

COMPANY PROFILE OF SRI VARA LAKSHMI MOTORS LTD

Brijmohan Lall munjal-the king of the road, the venerated patriarch and visionary of the

hero group, is a first generation entrepreneur who started very small and through sheer hard work

and perseverance has today made his two-wheeler venture the world‘s no.1 two wheeler

company. The story of the ‗indomitable entrepreneur‘, one of the brightest stories of Indian

entrepreneurship began 71 years ago when a six-years old boy quietly walked into a newly

opened gurkul (Indian value based school) near in his home in kamalia (now in Pakistan)

determine to gain admission. Impressed by his conviction, the gurukul granted him admission

instantly. Thus began an extraordinary saga of entrepreneurial achievement. Today, we know

that boy has brijmohan Lall munjal, the much-venerated patriarch of the hero group, one of the

largest groups in the corporate company. Brijmohan Lall‘s inspiration to enter the two wheeler

world came from a desire to provide the cheapest from of transport for the poorest of the poor.

Post-partition, Brijmohan Lall munjal and his brothers relocated to Ludhiana. They had to begin

from scratch. They set up as manufacture of the bicycle components. From then on, there was no



18

looking back. In typically modest manner, brijmohan Lall munjal accords a greatest deal of the

credit for his success to his family and his team.

BOARD OF DIRECTORS

Chairman Brijmohan Lall munjal

Joint managing director Toshiaki Nakagawa

Managing director & CEO Pawan munjal

Technical director Sumihisa fukuda

Non-Executive Director Pradeep dinda

Non-Executive and Independent director Prakesh malik

Non-Executive and Independent director Dr.pritam Singh

Non-Executive director Om prakesh munjal

Non-Executive director Masahiro

Non-Executive director Sunilkanth munjal

Non-Executive director Takashi Nagai

Non-Executive and Independent director Ms.shobhana Bhatia

Non-Executive and Independent director Sunil Bharti mittal

Non-Executive and Independent director Meleevtil Damodaran

ALTERNATE DIRECTOR Satoshi matuzawa

COMPLANCE OFFICER Sr. G. M. llam c. kamboj



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OTHER DIRECTORS:

Non-Executive and Independent director Amar Nath Maria

Non-Executive and Independent director Sunil Bharti Mittal

Whole-time director Yutaka kudo

Non-Executive and Independent director Marinade Nath vohra

COMMITTEE OF DIRECTORS:

Chairman Pradeep dinodia

Member Gen. (Retd.) Ved prakesh malik

Member Dr. Pritam Sing

REMUNERATION COMMITTEE:

Chairman Gen. (retd.) ved prakesh

Member Pradeep dinodia

SENIOR MANAGEMENT TEAM:

Sr.vice president & CFO Ravi sud

Sr.vice president-sales,Marketing and customer care Anil dua

Plants head-operative and supply chain Vikram s.kasbekar

Vice president-HRM, corporate Dr.Anand s. pande

Vice president-information systems Vijay sethi

INITIATIVES

An environment and socially, aware company at hero Honda, our goal is not only to sell

you a bike, but also to help every step in making your world better place in live in. besides it will

provide a high quality services to all its customers. Hero Honda takes a stand as a socially



20

responsible enterprise respectful of its environment and respectful of t6he important issues. Hero

Honda has been strongly committed not only to environment conversion programmers but also

expresses the increasingly inseparable balances between the economic concerns and the

environment and social issues faced but rather must mankind.

“We must do something for the community from whose land we generate our

wealth‖-a famous quote by Mr.Brijmohan Lall Munjal, CMD.

WEBSITE www.heromotocorp.in

HERO COMPANY PROFILE

TYPE Public company

Traded as BSE:500182

NSE: HEROMOTOCORP

BSE SENSEX Constituent

INDUSTRY Automotive

FOUNDED 19 January 1984(Gurgoan)

FOUNDERS Brijmohanlall munjal

HEADQUARTERS New Delhi, India

KEY PEOPLE Brijmohanlall munjal

Pawanmunjal(MD&CEO)

PRODUCTS Motorcycles, scooters, three-Wheeled vehicles

REVENUE 19669.290 CRORE

PARENT HERO GROUP



21

ORGANISATIONAL CHART

ManagingDirector

Financemanager

managerof services

Servicesaupervisor

Technicians

Floorsupervisor

Technicians

manager ofspares sales

Executiveof outdoor

manager ofwholesales

Executive

of showroom

Generalmanager



22

PROFILE OF THE DEALER

Sri Varalakshmi motors pvt.ltd.is one of the biggest hero Honda showroom in the

vizianagaram district. It is existed head quarters (vizianagaram) and the heart of the city. It has

been established in 2005 28th

Aug as hero authorized dealer Mr. Rama venkata reddy is the

managing director of the company.

Sri Varalakshmi motors pvt.ltd. Is selling around 1000 vehicles per year and around 50

employees are working in the company. Marketing and sales department has one marketing

manager, 2 marketing executives and 5 members of sales team.

Sri Varalakshmi motors pvt.ltd. Has a huge automates Work shop for servicing of the

vehicles. Daily around 50 vehicles and services and repaired in the servicing centre. Workshop

has one service manager, Technical supervisor and skilled mechanics.

Sri Varalakshmi motors pvt.ltd. Has linked with HDFC, ICICI. To finance the

customers who wish to buy the vehicles in Finance. Monthly the company maintenance 300

vehicles as opening stock and sell 250 vehicles. The company authorities invested 2 crores to

shape the company.

CONSUMER FACILITIES AT SERVICING CENTER

1. Automated workshop

2. Quick service

3. Breakdown servicing

4. Lounge for customers

5. Phone

6. Restroom

7. Free replacement and split pin and tube cap

8. TV with cable



23

9. RTA approved pollution checkup

10. Free drop facilities

Services offered

The service offered to the customers in the Sri Varalakshmi motors pvt.ltd.

1. 3 free services and paid services after sale of motorcycle

2. Free checkup campaign

3. Finance through banks

4. Demonstrations of new products

5. Acceptance of Warranty from claim.

Products available at Sri Varalakshmi motors pvt.ltd.

Sri Varalakshmi motors pvt.ltd. Franchise of Herohonda Company. Herohonda Company

manufactures various types of motorcycles. These are

1. Hero Honda ambition

2. Herohonda cbx-xtreme

3. Herohonda cd deluxe

4. Herohonda cd dawn

5. Herohonda glamour

6. Herohonda glamour 125 PGM fi

7. Herohonda hunk 150

8. Herohonda Karizma

9. Herohonda Karizma ZMR



24

10. Herohonda passion plus

11. Herohonda pleasure

12. Herohonda passion pro

13. Herohonda splendor NXG

14. Herohonda Splendor plus

15. Herohonda Super splendor 125

16. Hero impulse

17. Hero Maestro

18. Hero Ignitor

Employers in Sri Varalakshmi motors pvt.ltd

Sri Varalakshmi motors pvt.ltd. Headed by managing director. It has various

departments- Accounts department, Sales department, Spares department and workshops. Total

employees in Sri Varalakshmi motors are around 65 members in various departments.

SALES Sales of the Sri Varalakshmi motors are higher than any other two-wheeler

company in vizianagaram.

YEAR NO.OF UNITS

2005-2006 2223

2006-2007 3938

2007-2008 4149

2008-2009 4983

2009-2010 5500

2010-2011 5000



25

INTRODUCTION TO MARKETING MIX

The 21st century has seen the advent of the new economy, thanks to the technology

innovation and development. To understand the new economy, it is important to understand in

brief characteristics and features of the old economy. Industrial revolution was the start point of

the old economy with focus on producing massive quantities of standardized products. This mass

product was important for cost reduction and satisfying large consumer base, as production

increased companies expanded into new markets across geographical areas. The old economy

had the organizational hierarchy where in top management gave out instructions which were

executed by the middle manager over the workers.

In contrast, the new economy has seen the buying power at all time thanks to the digital

revolution. Consumers have access to all types‘ information for product and services.

Furthermore, standardization has been replaced by more customization with a dramatic increase

in terms of product offering. Purchase experience has also changed as well with the introduction

of online purchase, which can be done 24 × 7 with products getting delivered at office or home.

Companies have also taken advantage of information available and are designing more efficient

marketing programs across consumers as well as the distribution channel. Digital revolution has

increased speed of communication mobile, e-mail SMS, etc. This helps companies take faster

decisions and implement strategies more swiftly.

Marketing is art of developing, advertising and distributing goods and services to

consumer as well as business. However, marketing is not just limited to goods and services it is

extended to everything from places to ideas and in between. This brings forth many challenges

within which marketing people have to take strategy decisions. And answer to these challenges

depends on the market the company is catering to, for consumer market decision are with respect

to product, packaging and distribution channel. For business market, knowledge and awareness

of product is very essential for marketing people as businesses are on the lookout to maintain or

establish a credential in their respective market. For global market, marketing people have to

consider not only culture diversity but also be careful with respect to international trade laws,

trade agreement, and regulatory requirements of individual market. For non for profit



26

organization with limited budgets, importance is related to pricing of products, so companies

have to design and sell products accordingly.

Marketing philosophy employed by any given company has to be mix of organization

interest, consumer interest and societal interest. In production philosophy, companies focus is on

numbers, high production count, which reduces cost per unit and along with mass distribution.

This kind of concept is usually making sense in a developing market where there is the need of

product in large numbers. The product philosophy talks about consumers who are willing to pay

an extra premium for high quality and reliable performance, so companies focus on producing

well made products. The selling concept believes in pushing consumers into buying of products,

which under normal circumstance, they would be resistant. The marketing concept believes

consumer satisfaction, thereby developing and selling products keeping focus solely on customer

needs and wants. The customer philosophy believes in the creation of customized products,

where in products is design looking at historical transaction of consumers. The last philosophy is

the societal concept which believes in developing products, which not only generate consumer

satisfaction but also take into account well being of society or environment.

Digital revolution and 21st century have made companies fine tune the way they conduct

their business. One major trend observed is the need of stream lining processes and systems with

the focus on cost reduction through outsourcing. Another trend observed in companies is,

encouragement to entrepreneur style of work environment with glocal (global-local) approach.

At the same time, marketers of companies are looking forward to building long term relationship

with consumers. This relationship establishes platform understanding consumer needs and

preference. Marketers are looking at distribution channels as partners in business and not as the

customer. Companies and marketers are making decisions using various computers simulated

models.

Neil Borden in the year 1953 introduced the term Marketing mix, an extension of the work done by one of his associates James Culliton in 1948.

Marketing Mix - A mixture of several ideas and plans followed by a marketing

representative to promote a particular product or brand is called marketing mix. Several



27

concepts and ideas combined together to formulate final strategies helpful in making a brand

popular amongst the masses form marketing mix.

Elements of Marketing Mix

The elements of marketing mix are often called the four P‘s of marketing.

Product

Goods manufactured by organizations for the end-users are called products.

Products can be of two types - Tangible Product and Intangible Product (Services)

An individual can see, touch and feel tangible products as compared to intangible products.

A product in a market place is something which a seller sells to the buyers in exchange of

money.

Price

The money which a buyer pays for a product is called as price of the product. The price of a

product is indirectly proportional to its availability in the market. Lesser its availability, more

would be its price and vice a versa.

Retail stores which stock unique products (not available at any other store) quote a higher price

from the buyers.

Place

Place refers to the location where the products are available and can be sold or purchased.

Buyers can purchase products either from physical markets or from virtual markets. In a physical

market, buyers and sellers can physically meet and interact with each other whereas in a virtual

market buyers and sellers meet through internet.



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Four C’s of Marketing Mix

Now a days, organizations treat their customers like kings. In the current scenario, the four C‘s

has thus replaced the four P‘s of marketing making it a more customer oriented model. Koichi

Shimizu in the year 1973 proposed a four C‘s classification.

Commodity - (Replaces Products)

Cost - (Replaces Price) involves manufacturing cost, buying cost and selling cost

Channel - The various channels which help the product reach the target market.

Communication - (Replaces Promotion)

INTRODUCTION TO MARKETING MIX

Marketing identifies consumers‘ needs and supplies various goods and services to satisfy those

needs most effectively. So the businessman needs to: (a) produce or manufacture the product

according to consumers‘ need; (b) make available it at a price that the consumers‘ find

reasonable; (c) supply the product to the consumers at different outlets they can conveniently

approach; and (d) inform the consumers about the product and its characteristics through the

media they have access to.

So the marketing manager concentrates on four major decision areas while planning the

Marketing activities, namely, (i) products, (ii) price, (iii) place (distribution) and (iv) promotion.

These 4 ‗P‘s are called as elements of marketing and together they constitute the marketing mix.

All these are inter-related because a decision in one area affects decisions in other areas. In this

lesson you will learn about the basic aspects relating to these 4‗P‘s viz., product, price, place and

promotion.

OBJECTIVES

After studying this lesson, you will be able to :

• explain the concept of marketing mix and its components;



30

• explain the meaning of product and its classification;

• state the various factors affecting pricing decisions;

• describe different methods of pricing;

• state the meaning of channels of distribution;

• identify the various channels of distribution;

• state the factors affecting choice of a channel of distribution; and

• explain the concepts of promotion and promotion mix.

CONCEPT AND COMPONENTS OF MARKETING MIX

Marketing involves a number of activities. T o begin with, an organization may decide on

its target group of customers to be served. Once the target group is decided, the product is to be

placed in the market by providing the appropriate product, price, distribution and promotional

efforts. These are to be combined or mixed in an appropriate proportion so as to achieve the

marketing goal. Such mix of product, price, distribution and promotional efforts is known as

‗Marketing Mix‘.

According to Philip Kotler ―Marketing Mix is the set of controllable variables that the

firm can use to influence the buyer‘ s response‖. The controllable variables in this context refer

to the 4 ‗P‘ s [product, price, place (distribution) and promotion]. Each firm strives to build up

such a composition of 4‗P‘ s, which can create highest level of consumer satisfaction and at the

same time meet its organisational objectives.

Thus, this mix is assembled keeping in mind the needs of target customers, and it varies

from one organisation to another depending upon its available resources and marketing

objectives.

Product:

Product refers to the goods and services offered by the organization. All these are

purchased because they satisfy one or more of our needs. We are paying not for the tangible



31

product but for the benefit it will provide. So, in simple words, product can be described as a

bundle of benefits which a marketer offers to the consumer for a price. Product can also take the

form of a service like an air travel, telecommunication, etc. Thus, the term product refers to

goods and services offered by the organisation for sale.

Price:

Price is the amount charged for a product or service. It is the second most important

element in the marketing mix. Fixing the price of the product is a tricky job. Many factors like

demand for a product, cost involved, consumer ‘ s ability to pay , prices charged by competitors

for similar products, government restrictions etc. have to be kept in mind while fixing the price.

In fact, pricing is a very crucial decision area as it has its effect on demand for the product and

also on the profitability of the firm.

Place:

Goods are produced to be sold to the consumers. They must be made available to the

consumers at a place where they can conveniently make purchase. So, it is necessary that the

product is available at shops in your town. This involves a chain of individuals and institutions

like distributors, wholesalers and retailers who constitute firm‘ s distribution network (also called

a channel of distribution). The organization has to decide whether to sell directly to the retailer or

through the distributors/wholesaler etc. It can even plan to sell it directly to consumers. The

choice is guided by a host of factors about which you will learn later in this chapter .

Promotion:

If the product is manufactured keeping the consumer needs in mind, is rightly priced

and made available at outlets convenient to them but the consumer is not made aware about its

price, features, availability etc, its marketing effort may not be successful. Therefore promotionis an important ingredient of marketing mix as it refers to a process of informing, persuading and

influencing a consumer to make choice of the product to be bought. Promotion is done through

means of personal selling, advertising, publicity and sales promotion. It is done mainly with a

view to provide information to prospective consumers about the availability , characteristics and

uses of a product. It arouses potential consumer‘s interest in the product, compare it with



32

competitors‘ product and make his choice. The proliferation of print and electronic media has

immensely helped the process of promotion.

CONCEPT OF PRODUCT AND ITS CLASSIFICA TION

As stated earlier, product refers to the goods and services offered by the organization for sale.

Here the marketers have to recognize that consumers are not simply interested in the physical

features of a product but a set of tangible and intangible attributes that satisfy their wants. For

example, when a consumer buys a washing machine he is not buying simply a machine but a

gadget that helps him in washing clothes. It also needs to be noted that the term product refers to

anything that can be offered to a market for attention, acquisition, or use.

Thus, the term product is defined as ―anything that can be offered to a market to satisfy a want‖.

It normally includes physical objects and services. In a broader sense, however, it not only

includes physical objects and services but also the supporting services like brand name,

packaging accessories, installation, after sales service etc.

Product

Acc to William J. S tanton

―Product is a set of tangible and intangible attributes including packaging, colour ,pr ice,manufacturer‘ s prestige, retailer‘ s prestige and manufacturer‘ s and retailer‘services which

buyer may accept as offering satisfaction of wants and services‖.

Jerome McCarthy

―A product is more than just a physical product with its related functional and aesthetic features.

It includes accessories, installation, instructions on use, the package, perhaps a brand name,

which fulfills some psychological needs and the assurances that service facilities will be

available to meet the customer needs after the purchase‖.



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PRODUCT CLASSIFICATION

Product can be broadly classified on the basis of (1) use, (2) durability, and (3) tangibility.

Let us have a brief idea about the various categories and their exact nature under each head,

noting at the same time that in marketing the terms ‗product‘ and ‗goods‘ are often used

interchangeably .

1. Based on use, the product can be classified as:

(a) Consumer Goods; and

(b) Industrial Goods.

(a) Consumer goods: Goods meant for personal consumption by the households or ultimate

consumers are called consumer goods. This includes items like toiletries, groceries, clothes etc.

Based on consumers‘ buying behavior the consumer goods can be further classified as :

(i) Convenience Goods;

(ii) Shopping Goods; and

(iii) Speciality Goods.

(i) Convenience Goods: Do you remember, the last time when did you buy a packet of butter or

a soft drink or a grocery item? Perhaps you don‘t remember, or you will say last week or

yesterday. Reason is, these goods belong to the categories of convenience goods which are

bought frequently without much planning or shopping effort and are also consumed quickly .

Buying decision in case of these goods does not involve much pre-planning. Such goods are

usually sold at convenient retail outlets.

(ii) Shopping Goods: These are goods which are purchased less frequently and are used very

slowly like clothes, shoes, household appliances. In case of these goods consumers make choice

of a product considering its suitability, price, style, quality and products of competitors and

substitutes, if any. In other words, the consumers usually spend a considerable amount of time

and effort to finalize their purchase decision as they lack complete information prior to their



34

shopping trip. It may be noted that shopping goods involve much more expenses than

convenience goods.

(iii) Specialty Goods: Because of some special characteristics of certain categories of goods

people generally put special efforts to buy them. They are ready to buy these goods at prices at

which they are offered and also put in extra time to locate the seller to make the purchase. The

nearest car dealer may be ten kilometers away but the buyer will go there to inspect and purchase

it. In fact, prior to making a trip to buy the product he/she will collect complete information

about the various brands. Examples of specialty goods are cameras, TV sets, new automobiles

etc.

(b) Industrial Goods: Goods meant for consumption or use as inputs in production of other

products or provisions of some service are termed as ‗industrial goods‘. These are meant for non-

personal and commercial use and include (i) raw materials, (ii) machinery , (iii) components, and

(iv) operating supplies (such as lubricants, stationery etc). The buyers of industrial goods are

supposed to be knowledgeable, cost conscious and rational in their purchase and therefore, the

marketers follow different pricing, distribution and promotional strategies for their sale.

It may be noted that the same product may be classified as consumer goods as well as industrial

goods depending upon its end use. Take for example the case of coconut oil. When it is used as

hairoil or cooking oil, it is treated as consumer goods and when used for manufacturing a bath

soap it is termed as industrial goods. However, the way these products are marketed to these two

groups are very different because purchase by industrial buyer is usually large in quantity and

bought either directly from the manufacturer or the local distributor.

2. Based on Durability, the products can be classified as:

(a) Durable Goods; and

(b) Non-durable Goods.

(a) Durable Goods:

Durable goods are products which are used for a long period i.e., for months or years together .

Examples of such goods are refrigerator , car , washing machine etc. Such goods generally



35

require more of personal selling efforts and have high profit mar gins. In case of these goods,

seller‘s reputation and pre-sale and after-sale service are important determinants of purchase

decision.

(b) Non-durable Goods:

Non-durable goods are products that are normally consumed in one go or last for a few uses.

Examples of such products are soap, salt, pickles, sauce etc. These items are consumed quickly

and we purchase these goods more often. Such items are generally made available by the

producer through large number of convenient retail outlets. Profit margins on such items are

usually kept low and heavy advertising is done to attract people towards their trial and use.

3. Based on tangibility, the products can be classified as:

(a) tangible Goods; and

(b) Intangible Goods.

(a) Tangible Goods:

Most goods, whether these are consumer goods or industrial goods and whether these are durable

or non-durable, fall in this category as they have a physical form that can be touched and seen.

Thus, all items like groceries, cars, raw-materials, machinery etc. fall in the category of tangible

goods.

(b) Intangible Goods:

Intangible goods refer to services provided to the individual consumers or to the organisational

buyers (industrial, commercial, institutional, government etc.). Services are essentially intangible

activities which provide want or need satisfaction. Medical treatment, postal, banking and

insurance services etc., all fall in this category.

PRICING AND FACTORS AFFECTING PRICING DECISIONS

As stated earlier price is the consideration in terms of money paid by consumers for the

bundle of benefits he/she derives by using the product/ service. In simple terms, it is the

exchange value of goods and services in terms of money. Pricing (determination of price to be



36

charged) is another important element of marketing mix and it plays a crucial role in the success

of a product in the market. If the price fixed is high, it is likely to have an adverse effect on the

sales volume. If, on the other hand, it is too low, it will adversely affect the profitability. Hence,

it has to be fixed after taking various aspects into consideration.

The factors usually taken into account while determining the price of a product can be

broadly described as follows:

(a) Cost: No business can survive unless it covers its cost of production and distribution. In large

number of products, the retail prices are determined by adding a reasonable profit margin to the

cost. Higher the cost, higher is likely to be the price, lower the cost lower the price.

(b) Demand: Demand also affects the price in a big way. When there is limited supply of a

product and the demand is high, people buy even if high prices are charged by the producer . But

how high the pr ice would be is dependent upon prospective buyers‘ capacity and willingness to

pay and their preference for the product. In this context, price elasticity, i.e. responsiveness of

demand to changes in price should also be kept in view.

(c) Competition: The price charged by the competitor for similar product is an important

determinant of price. Marketer would not like to charge a price higher than the competitor for

fear of losing customers. Also, he may avoid charging a price lower than the competitor.

Because it may result in price war which we have recently seen in the case of soft drinks,

washing powder, mobile phone etc.

(d) Marketing Objectives: A firm may have different marketing objectives such as

maximization of profit, maximization of sales, bigger market share, survival in the market and so

on. The prices have to be determined accordingly. For example, if the objective is to maximize

sales or have a bigger market share, a low price will be fixed.

(e) Government Regulation: Prices of some essential products are regulated by the government

under the Essential Commodities Act. For example, prior to liberalization of the economy ,

cement and steel prices were decided by the government. Hence, it is essential that the existing

statutory limits, if any, are also kept in view while determining the prices of products by the

producers.



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METHODS OF PRICE FIXATION

Methods of fixing the price can be broadly divided into the following categories.

1. Cost based pricing

2. Competition based pricing

3. Demand based pricing

4. Objective based pricing

1. Cost Based Pricing

Under this method, price of the product is fixed by adding the amount of desired profit margin to

the cost of the product. If a particular soap costs the marketer Rs. 8 and he desires a profit of

25%, the price of the soap is fixed at Rs 8 + (8x25/100) =Rs. 10.

While calculating the price in this way, all costs (variable as well as fixed) incurred in

manufacturing the product are taken into consideration.

2. Competition Based Pricing

In case of products where market is highly competitive and there is negligible difference in

quality of competing brands, price is usually fixed closer to the price of the competing brands. It

is called ‗young rate pricing‘ and is a very convenient method because the marketers do not have

to worry much about demand and cost and effect the change as per the changes by the industry

leaders.

3. Demand Based Pricing

At times, prices are determined by the demand for the product. Under this method, without

paying much attention to cost and competitor‘s prices, the marketers try to ascertain the demand

for the product. If the demand is high they decide to take advantage and fix a high price. If the

demand is low, they fix low prices for their product. At times they resort to differential prices

and charge different prices from different groups of customers depending upon their perceived

values and capacity to pay.



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4. Objective Based Pricing

This method is applicable to introduction of new (innovative) products. If, at the introductory

stage of the products, the organization wishes to penetrate the market i.e., to capture large parts

of the market and discourage the prospective competitors to enter into the fray, it fixes a low

price. Alternatively , the organization may decide to skim the market i.e., to earn high profit by

taking advantage of a group of customers who give more importance to their status or distinction

and are willing to pay even a higher price for it. In such a situation they fix quite high price at the

introductory stage of their product and market it to only those customers who can afford it.

CHANNELS OFDISTRIBUTION

You are aware that while a manufacturer of a product is located at one place, its consumers are

located at innumerable places spread all over the country or the world. The manufacturer has to

ensure the availability of his goods to the consumers at convenient points for their purchase. He

may do so directly or, as stated earlier, through a chain of middlemen like distributors,

wholesalers and retailers. The path or route adopted by him for the purpose is known as channel

of distribution. A channel of distribution thus, refers to the pathway used by the manufacturer

for transfer of the ownership of goods and its physical transfer to the consumers and the

user/buyers (industrial buyers).

Stanton has also defined it as ―A distribution channel consists of the set of people and firms

involved in the transfer of title to a product as the product moves from producer to ultimate

consumer or business user‖. Basically it refers to the vital links connecting the manufacturers

and producers and the ultimate consumers/users. It includes both the producer and the end user

and also the middlemen/agents engaged in the process of transfer of title of goods.

Primarily a channel of distribution performs the following functions:

(a) It helps in establishing a regular contact with the customers and provides them the necessary

information relating to the goods.

(b) It provides the facility for inspection of goods by the consumers at convenient points to make

their choice.



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(c) It facilitates the transfer of ownership as well as the delivery of goods.

(d) It helps in financing by giving credit facility.

(e) It assists the provision of after sales services, if necessary.

(f) It assumes all risks connected with the carrying out the distribution function.

TYPES OF CHANNELS OFDISTRIBUT ION

Generally we do not buy goods directly from the producers. The producers/manufacturers

usually use services of one or more middlemen to supply their goods to the consumers. But

sometimes, they do have direct contact with the customers with no middlemen in between them.

This is true more for industrial goods where the customers are highly knowledgeable and their

individual purchases are large. The various channels used for distribution of consumer goods can

be described as follows:

1. Zero stage channel of distribution

Manufacturer__________> consumer

Zero stage distribution channel exists where there is direct sale of goods by the producer to the

consumer . This direct contact with the consumer can be made through door-to-door salesmen,

own retail outlets or even through direct mail. Also in case of perishable products and certain

technical household products, door-to-door sale is an easier way of convincing consumer to

make a purchase. Eureka Forbes, for example, sells its water purifiers directly through their own

sales staff.

2. One stage channel of distribution.

Manufacturer- retailer- consumer

In this case, there is one middleman i.e., the retailer. The manufacturers sell their goods to

retailers who in turn sell it to the consumers. This type of distribution channel is preferred by

manufacturers of consumer durables like refrigerator, air conditioner, washing machine, etc.

where individual purchase involves large amount. It is also used for distribution through large

scale retailers such as departmental stores (Big Bazaar, Sponsors) and super markets.



40

3. Two stage channel of distribution

Manufacturer- wholesaler- retailer- consumer

This is the most commonly used channel of distribution for the sale of consumer goods. In this

case, there are two middlemen used, namely, wholesaler and retailer. This is applicable to

products where markets are spread over a large area, value of individual purchase is small and

the frequency of purchase is high.

4. Three stage channel of distribution

Manufacturer- agent- wholesaler- retailer- consumer

When the number of wholesalers used is large and they are scattered throughout the country , the

manufacturers often use the services of mercantile agents who act as a link between the producer

and the wholesaler . They are also known as distributors.

FACTORS AFFECTING THE CHOICE OF DISTRIBUTION CHANNEL

Choice of an appropriate distribution channel is very important as the pricing as well as

promotion strategy are dependent upon the distribution channel selected. Not only that, the route

which the product follows in its journey from the manufacturer to the consumer also involves

certain costs. This in turn, affects not only the price of the product but also the profits. Choice of

inappropriate channels of distribution may result in lesser profits for the manufacturer and higher

price from the consumer. Hence, the manufacturer has to be careful while finalizing the channel

of distribution to be used. He should pay attention to the following factors while making his

choice.

(a) Nature of Market: There are many aspects of market which determine the choice of channel

of distribution. Say for example, where the number of buyers is limited, they are concentrated at

few locations and their individual purchases are large as is the case with industrial buyers, direct

sale may be the most preferred choice. But in case where number of buyers is large with small

individual purchase and they are scattered, then need may arise for use of middlemen.

(b) Nature of Product: Nature of the product considerably affects the choice of channel of

distribution. In case the product is of technical nature involving a good amount of pre-sale and



42

– Publicity

– Personal selling

– Sales promotion

These are also termed as four elements of a promotion mix. Let us have a brief idea about these

promotion tools.

1. Advertising: Advertising is the most commonly used tool for informing the present and

prospective consumers about the product, its quality, features, availability, etc. It is a paid form

of non-personal communication through different media about a product, idea, a service or an

organization by an identified sponsor. It can be done through print media like newspaper,

magazines, billboards, electronic media like radio, television, etc. It is a very flexible and

comparatively low cost tool of promotion.

2. Publicity: This is a non-paid process of generating wide range of communication to

contribute a favorable attitude towards the product and the organization. You may have seen

articles in newspapers about an organization, its products and policies. The other tools of

publicity are press conference, publication and news in the electronic media etc. It is published

or broadcasted without charging any money from the firm. Marketers often spend a lot of time

and effort in getting news items placed in the media for creation of a favorable image of the

company and its products.

3. Personal selling: Y ou must have come across representatives of different companies

knocking at your door and persuading you to buy their product. It is a direct presentation of the

product to the consumers or prospective buyers. It refers to the use of salespersons to persuade

the buyers to act favorably and buy the product. It is most effective promotional tool in case of

industrial goods.

4. Sales promotion: This refers to short-term and temporary incentives to purchase or induce

trials of new goods. The tool includes contests, games, gifts, trade shows, discounts, etc. Sales

promotional activities are often carried out at retail levels.



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AN ANALYSIS OF MARKETING MIX STRATEGIES WITH REFERENCE TO -

SRI VARA LAKSHMI MOTORS PRIVATE LTD.

Sri Varalakshmi motors pvt.ltd.is one of the biggest hero Honda showroom in the vizianagaram

district. It is existed head quarters (vizianagaram) and the heart of the city. It has been

established in 2005 28th

Aug as hero authorized dealer Mr. Rama venkata reddy is the managing

director of the company.

Sri Varalakshmi motors pvt.ltd. Is selling around 1000 vehicles per year and around 50

employees are working in the company. Marketing and sales department has one marketing

manager, 2 marketing executives and 5 members of sales team.

Sri Varalakshmi motors pvt.ltd. Has a huge automates Work shop for servicing of the

vehicles. Daily around 50 vehicles and services and repaired in the servicing centre. Workshop

has one service manager, Technical supervisor and skilled mechanics.

Sri Varalakshmi motors pvt.ltd. has linked with HDFC, ICICI. To finance the customers

who wish to buy the vehicles in Finance. Monthly the company maintenance 300 vehicles as

opening stock and sell 250 vehicles. The company authorities invested 2 crores to shape the

company.

CONCEPT OF MARKETING MIX

According to Philip Kotler ―Marketing Mix is the set of controllable variables that the

firm can use to influence the buyer‘s response‖. The controllable variables in this context refer

to the 4 ‗P‘s [ product, price, place (distribution) and promotion]. Each firm strives to build up

such a composition of 4‗P‘s, which can create highest level of consumer satisfaction and at the

same time meet its organisational objectives.

Thus, this mix is assembled keeping in mind the needs of target customers, and it varies

from one organisation to another depending upon its available resources and marketing

objectives.



45

Hero Moto Corp Street Smart

Hero Moto Corp Cbz

Hero Moto Corp Joy

Hero Moto Corp Passion

Hero Moto Corp Ambition

Product Decisions

The term "product" refers to tangible, physical products as well as services. Here are some

examples of the product decisions to be made:

1. Brand name

2. Functionality

3. Styling

4. Quality

5. Safety

6. Packaging

7. Repairs and Support

8.

Warranty

9. Accessories and services

PRICE

The amount as of money or goods , a sked for or given in exchange for something

e l s e . The cos t a t wh i ch s omet h i ng i s ob t a i ned : be l i eves t ha t t he p r i ce o f

success is hard work. a reward offered for the capture or killing of a person: a felon with a price

on his head. a free system could not flourish without price competition. Price is the universal

index of value. it is the best measure of demand. Price serves to bring the supply of goods and

services produced into equilibrium with the quantity demanded. In a business firm various

marketing decisions relating to pricing of products are the most significant because they from the

very basis for survival and growth of the firm.



46

PRICING STRATEGIES OF HERO MOTO CORP

The company has a policy to price its product very competitively. In today‘s world,one

cannot has a skimming pricing says Mr. Tapan, marketing manager, Hero Moto Corp.

Necessarily the pricing policy is completely a blend of two strategies i.e. Penetration and

Skimming. It has been the company‘s policy to provide the customers with value for money -give

more for less. We are the only company in the two wheeler segment that is in the process of

passing on the whole benefit of cost advantage achieved as a result of the increased localization

levels of up to 60% to the customers.

We are in the process of keeping our product increasing popular and affordable. The

company keeps telling its customers to think about Quality rather than price. Further if one talks

about the changes in the price in the last three years, the prices have never been changed except

the budgets except once in APRIL 2011,when the company started off with their ―celebration

offer‖, and thus decided to sanctioned a discount and curtail on every Model Rs 1001\-. The

company is surely in a business of delivering quality rather than price. The company gives

importance to the quality rather than cheap products.

Well Hero Moto Corp has bikes at different price point but there is one common thing

that is they are priced at a premium of INR 2000- 3000 from the competitors and it seems their

strategy is working fine with the target customers as it is the largest seller of bikes in the Indian

market with a market share of 48 % .Customers are ready to shell out the extra money because

they believe and its fact that the fuel efficiency of the bikes is much better than its competitors.

The different price points for Hero Motors Limited are :

NAME PRICE

Dawn ------------------- 32,000

Splendor --------------- 41,000

Passion ---------------- 44,000

Cbz--------------------- 52,000-60,000

Thus we find that HML has bikes for every one for entry level customers they have dawn which

is a no frill attached product whose emphasis is on mileage with performance .And for customers

who like to have bike which is good at performance and with descent looks they have Splendor

which is their fastest selling bike and account for half of the total sales. Customers who are



47

looking for style with performance can go for Passion which is a huge success among the urban

class as it is priced little bit higher than splendor and the looks of the bike are astounding.

For customers who want style and power they have CBZ which is targeted towards the

premium segment and it was a runaway success initially but is not a hot seller now due to some

problems. Hero Moto Corp is planning to introduce few more models in year‘s time in order to

make their portfolio of products more versatile. They are trying to introduce new models and

they are trying to introduce models at the premium segment as it has high margins and the

company feels that it‘s the segment which is will grow in the near future as the income of people

will increase with the change of life styles .HML also intend to introduce few models which are

economical in nature as they this segment provides the volumes to the company. Hero Moto

Corp still wants to charge a price of premium as its brand enjoys a high level of respectability

and reliability among the target customers as their products have already proved their mettle in

the market and enjoy high level of brand equity among the target customers.

Hero Moto Corp has an advantage of large no of dealers and also economies of scale

which help them to absorb the costs to a great extent.

Price Decisions

1. Pricing strategy (skimming, penetration, etc.)

2. Suggested retail price

3.

Volume discounts and wholesale pricing4. Cash and early payment discounts

5. Seasonal pricing

6. Bundling

7. Price flexibility

8. Price discrimination

PRICE OF THE PRODUCTS AN OVERVIEW:

Hero Motocorp Karizma ZMR Price: Rs. 1, 03,000

Hero Motocorp HF CD Dawn Price: Rs. 38,000

Hero Motocorp Pleasure Price: Rs. 42,500

http://compare.pricesofindia.com/vs/hero-motocorp-karizma-zmr

http://compare.pricesofindia.com/vs/hero-motocorp-hf-cd-dawn

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Hero Motocorp Splendor NXG Price: Rs. 43,000

Hero Motocorp HF Deluxe Price: Rs. 44,000

Hero Motocorp Splendor plus Price: Rs. 44,500

Hero Motocorp Passion plus Price: Rs. 45,000

Hero Motocorp Splendor Pro Price : Rs. 45000-48100

Hero Motocorp Passion Pro Price: Rs. 49,000

Hero Motocorp Maestro Price: Rs. 50,000

Hero Motocorp Passion xPro Price: Rs. 51,500

Hero Motocorp Super Splendor Price: Rs. 51800

Hero Motocorp Glamour Price: Rs. 54,500

Hero Motocorp Ignitor Price: Rs. 57,200

Hero Motocorp Achiever Price: Rs. 58,000

Hero Motocorp Impulse Price: Rs. 69,500

Hero Motocorp Hunk Price: Rs. 71,200

Hero Motocorp CBZ Xtreme Price: Rs. 72,300

Hero Motocorp Karizma R Price: Rs. 82,100

PLACE

Place stands for various activities the company undertake such as channels, coverage,

location, inventory and transport, to make the product accessible and available to target

consumers. Thus, a firm must identify, recruit, and link various middle men under and marketing

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49

facilitators so that its products and services are efficiently supplied to the target market. It must

understand the various types of retailers, wholesalers and physical distribution firms as how they

make their decisions.

PLACEMENT OF HERO MOTO CORP

Hero Moto Corp Limited sells the motorcycle through a widely spread all India networks

of over 450 of dealers. The motorcycle can be serviced at the authorized dealers or SSP‘s (Spare

and Service points). In the year 1996, Hero Moto Corp was the first company to introduce

India‘s first chain of automated services workshops. To expand the ser vice network further to

smaller towns, the company has appointed Service extensions.

Hero Moto Corp genuine spare parts are available from the dealers, SSP‘s and the

stockiest. The company provides good after sales service through its well-established dealer

network. The company has a policy of three S, Single S for stockiest, Double S for services and

three SSS for sales. The company is having about 460 of SSS, which deals in Sales, Service, and

Stock, 260 of SS, which deals in Service and Stock and 12 of S, which exclusively deals in

stocks.

The Network As On 31st March 2002 Is As Under: Dealers (3s_-Sales, Service, Spares)-

458, Ssp‘s (2 S-Service and Spares)-256, Stockiest (Single S-Spares)-12

The company has developed a unique distribution network, which has given it a

distinctive competitive advantage. The whole idea behind establishing this vast distribution

network is to reach the customer even in the remote areas.

The company has segregated the areas as Urban, Rural, and semi rural and has appointed

dealers in many of these areas, after seeing the potential. The company‘s major thrust is the easy

availability of all the models in every part of the country. The company‘s bikes are sold through

the dealers and they are required to provide proper infrastructure, Workshops, Facilities, and

trained Personals.

The dealers are given targets and they are required to sell sufficient number of vehicles to

earn a return on investments. Regional offices are in constant touch with these dealers.



50

Presently the company is having 8 regional offices in the country. The regional offices constantly

assist these offices as a kind of linkage between the company and the dealer and the dealers.

The sales and the marketing personals at the regional offices are trained and encourage

maintaining a cordial relationship with various dealers on the basis of trust and understanding.

The company‘s service engineer and the other sales staff supervise all the facilities at the dealer

and the service outlet from planning the layout to the erecting of the specially designed benches

and the tools.

In fact all the possible efforts are made by the company to make the dealers to become

the part of the Hero family and its culture. The company has appointed fleet of more than 400

trucks from around 45 transporters to assist them in the delivery of vehicle. From the factory and

within the factory premises, the company has a good fleet of trucks and trailers.

The cargos are loaded in the trucks and the trailers and they are delivered at the

stockyards of the dealers in whichever part of the country they may be located. So the company

in this way delivers the motorbikes in the fresh factory conditions. By the time the bike reaches

our dealers they might have done hardly a couple of kilometers.

The company believes the marketing efforts should go beyond ensuring product

availability. The focus is therefore on a vast distribution network. In order to ensure the

customers a better quality service at the various stations, the company mounts an effective

training program in which all the mechanic, supervisory staff and the other senior staff personnel

participate.

The company is also planning to set up some of the fully equipped express authorized

highway. In these highways, one would see a Hero Moto Corp dealer every 15-25 KMS. This

concept is thought by the company with a view to provide good after sales services to the

customer. This exercise will also check the company to check the use of spurious products,

which ultimately spoil the bike. The highways to be covered in this scheme are:

-GWALIOR

-CHANDIGARH

-LUDHIANA

-DHANBAD

The company is perhaps the second company after Maruti Udyog Limited to implement a

factory fresh concept. The company is the only company in the two-wheeler segment having so



51

much of vast distribution network. Hero Moto Corp will be adding 25 more dealers and

50service stations to build a network of 575 dealership-cum-service points (including 400

dealerships) across the country. The level of investment in an automated Hero Moto Corp service

station is expected to be around Rs 10 lakh, apart from land and building.

Consumer Finance:

In order to focus on organized consumer financing, Hero Moto Corp tied up with Tata

Finance a week ago. This is Hero Moto Corp's second tie-up following Centurion, which is

accounting for around 3,000 bikes a month through 100 dealerships.

A thorough understanding of the fast-changing consumer behavior, new market segments

and product opportunities along with sensitivity to changing customer needs, form the core of

Hero's marketing strategy and philosophy.

At Hero we essentially have a completely Customer-driven approach. A nation-wide

dealer network comprising of over 3,500 bicycle dealers, 350 dealers for mopeds and 225

franchise holders for motorcycles, ensures convenient access to the Group's products across the

country.

The Group has undertaken a steady up gradation of technologies and there has been

diversifications and setting up of newer establishments to meet stringent international standards.

At the core of it all is a customer-centric scheme of policies and production and the bottom line

is to "Add Value while Engineering Satisfaction.

DISTRIBUTION CHANNELS – AN OVER VIEW OF HERO MOTORCORP

Place is also known as channel, distribution, or intermediary. It is the mechanism

through which goods and/or services are moved from the manufacturer/ service provider to the

user or consumer. The organization must distribute the product to the user at the right place at the

right time. Efficient and effective distribution is important if the organization is to meet its

overall marketing objectives

The Hero Moto corp. use intermediaries such as wholesalers, agents, retailers, the

Internet, and direct marketing for sell their products. The Hero Moto corp. provides their bikes

indirectly to its target customers. The advantage of indirect distribution is that it reduces the cost

of manufacturer.



52

We can see reach easily on the outlets of Hero Moto corp. in every city and buy their

products. This company use Exclusive distribution for selling their products. It means exclusive

distribution Involves limiting distribution to a single outlet.

DISTRIBUTION CHANNEL- HERO MOTORCORP

DEALER MANAGEMENT-

Mapping of regional dealers:

They have been divided into three categories on the basis of their turnover and the selling

capacity.

1. REGIONAL DEALERS:

Includes the modern trade and they have direct billing from the branch office. They have

high turnover and the company depends heavily on them

2. DISTRIBUTORS:

They have direct billing from the branch office. Their turnover is also high.

3. SUB DEALERS :

level 1• Manufacturer

level 2• Distributor

level 3• consumer



53

They have direct billing from distributors or from the branch office. Their turnover is not so

high, but there are few sub dealers whose potential is quite high. According to sales the

branch has designated as gold and silver sub dealers.

PROMOTION

Marketing is an activity, set of institutions, and processes for creating, communicating,

and delivering and exchanges offerings to that have value for customers, clients, partners,

and society at large- American marketing association

PROMOTIONAL STRATEGIES OF HERO MOTO CORP

1.

Hero Moto Corp's `Ride Safe and Good Rider' campaign is aimed at communicating the

philosophy of delivering safe products and promoting good driving for the overall safety

of the Hero Moto Corp customer.

2. Created by McCann Erickson, the ad — Hero Moto Corp cares for your safety--invited all

Hero Moto Corp owners to attend the Ride Safe programme on October 27, 2011 at

Delhi's India Gate lawns. This was the first phase of the programme, where three

instructors from Japan demonstrated techniques of right driving.

3.

In the second phase, Hero Moto Corp will communicate the launch of the 4S concept(sales, service, spare parts and safety) at Hero Moto Corp dealerships.

4. The focus of the third phase will be to promote the launch of the Hero Moto Corp Safety

Riding Promotion School, which will have riding simulators and safety riding tracks

5. Hero will take the riding programme-- where trained personnel will give riding tips to

bike owners-- to over 100 dealerships across 90 towns.

6. Promotion in this sector cannot be like that in the Fast Moving Auto parts (Automobile)

sector. The promotions in this sector are like 0% finance schemes and 33 other sort of

things. The company takes the services of many good and reputed advertising agencies

like Reddifuusion, Lintas, sachi & Sachi and others.

7. The company has also signed a kind of agreement with two celebrities just now to be

their brand ambassadors. Hero Moto Corp, a leading manufacturer of motorcycles, has



54

roped in film actor Hrithik Roshan and captain of Indian Cricket team Sourav Ganguly as

its brand ambassadors for three years till 2003.

8. They would endorse the company products, attend corporate and brand events and help

promote its "we care" campaign comprising safety riding, environment, and friendliness.

9. Hero has embarked upon an ambitious project to achieve sale of one million bikes this

year with a market share of 47 per cent. The turnover would be in excess of Rs. 3000

crore.

10. The corporate campaign will be largely complemented by on-ground initiatives under the

umbrella brand of ``We Care'', incorporating activities in the arena of community

services, safety and services programmes, tree-plantations and environmental-friendly

projects.

11.

In line with Hero's worldwide, safety riding programme, this fiscal Hero Moto Corp

Motors Limited will take the riding programme-- where trained personnel will give riding

tips to bike owners

SALES PROMOTIONS

Hero Moto Corp regularly has promotions running for its dealers as well as customers in

order to ensure that there is a interest among the target customers about the company and its

products. Normally Company participates in road shows, Sponsors college festivals, promotes

eco friendly initiatives, Have festive Season offers, and sometimes price discounts to attract the

attention of the people.

These promotions are targeted mainly on youngsters as they are the primary buyers of

bikes. The company launches financial schemes as Zero % finance schemes in collaboration with

different banks so that customers can pick bikes in easy installments. The effect of these

promotions can be understood from the fact that 35 % of bikes are sold through this medium.

PROMOTION ANALYSIS:

The company is conducting various promotional activities to promote its products in the market because these activities only create awareness to the customer towards these products and

increases customer loyalty towards the company.

The various promotional activities conducting by Hero Moto corp. are

1. Advertisements:



55

Company is giving advertisements about its products, offers & other Information in the

televisions, newspapers every year. For this company is Also allocates budget to conduct this

activity successfully.

2. Safe road Programs:

Company is conducting safe road programs for the customers to create awareness on safe

bike riding. For this company conducts this event with the Professional Bike riders & with

the Celebrities also.

3. Discounts:

Company also gives discounts especially to the customers who are government employees,

students & senior citizens.

4. Free Service Campaigns:

Coming to free service campaigns, company is also conducting free service campaigns at

customer‘s work places.

5. Hero Good life Programs & offers:

This Good life programs especially conducting by Hero Moto corp. only. In this program

company conducts games to the customers, lucky dips in every month, bumper draws for

every six months. In this the customers can win new bikes, Prize money & free Trips.

6. Annual Celebrations With the Customers:

Company also conducts annual celebrations by inviting the customers every year. In this the

company conducts some entertainment programs to the customers & offers prizes to the

winners. This increases customer loyalty towards the company.

7. Melas:

Company also conducts exchange melas for the customers who are having interest to buy

new bike by exchanging their old bike.



56

Data Analysis of Marketing Mix Strategies at Hero Honda

Table 1:

Which of the following best describe your age group?

a) 14-18 b) 18-25 c) 25 to 35 d) above 35

Graph 1:

The graph represents the average age group which is consider for survey

Opinion About Age Group % Of Respondents

14-18 years 20

18-25 years 16

25 to 35 years 15

above 35 years 5

Total 100



57

Interpretation:

The above table and graph the age factor of responds is consider identifying the influence of

demographic factor for purchasing the product.

The marketing mix decisions are majority based on consumers taste and references to understand

the buying behavior of the consumers.

Majority of responds are between 14-18 age which constitute 20% of the survey

0

5

10

15

20

25

14-18 years 18-25 years 25 to 35 years above 35years

verage ge Group

% of respondents



58

Table 2:

For which purpose you purchase the motorbike?

a) College going b) Office going c) Maintain friend circle d) Other purpose

Graph 2:

The graph represents the purpose you purchasing the motorbike

Opinion About Purchase % Of Respondents

College going 39

Office going 25

friend circle 14

Other purpose 22

Total 100



59

Interpretation:

The above table and graph represents the consumer preferences to purchasing the motor bikes.

The aim of marketing is to meet and satisfy target customers wants and needs better than

competitors.

Markets always analyze the existing customer trends to identify new marketing opportunities.

From the study majority of respondents are using motor bikes for personal use

Purpose For Purchasing Motor Bike

College going

Office going

friend circle

Other purpose



60

Table 3:

Which of following company‘s motorbike do you have?

a) Bajaj b) HERO MOTO CORP c) Suzuki d) Yamaha e) Any other

Graph 3:

The graph represents the market share amongst various brands

Opinion About Market Share % Of Respondents

Bajaj 32

Hero Moto Corp 40

Suzuki 12

Yamaha 11

others 5

Total 100



61

Interpretation:

The above table and graph represents the maximum share of various brands in motor bikes

divisions.

The marketing strategy involves understanding the consumer perception of the product and

mapping with product attributes.

From this study, the majority of respondents that is 40% have contributed for maximum share for

hero Moto corp.

This is because company adopts effective positioning strategy in terms of pricing, promotion,

and product features.

0

5

10

15

20

25

30

35

40

Bajaj Hero Moto

Corp

Suzuki Yamaha others

Market Share Of Motor Bikes

% of respondents



62

Table 4:

How come you know about that brand?

a) T.V. b) Newspaper c) Dealer effort d) World of mouth e) Internet f) Any other

Graph 4:

Opinion about Brand Awareness % of respondents

Tv 38

News paper 25

Dealer effort 9

Word of mouth 23

others 5

Total 100



63

The graph represents the medium for creating brand awareness

Interpretation:

1.

The above table and graph represents the media selection for creating brand awareness

for the product. Branding is an important strategy for differentiation a product from its

competitor.

2. The marketing strategy to create consumer awareness includes developing and

communicative brand equity.

3. It reflect added value on production and services. From this survey it is analyze that the

media for creating brand awareness is maximum selected as electronic media like t.v,

radio etc.

0

5

10

15

20

25

30

35

40

Tv News

paper

Dealer

effort

Word of

mouth

others

Brand

wareness

Medium

% of respondents



64

Table 5:

Rate the following in order of influence to purchase a bike?

a) Brand image of the product b) Price c) After sales service d) Quality and feature of product

e) Ease of availability f) Value for money

Graph 5:

Opinion About Purchase Influencer % Of Respondents

Quality & feature 15

Price 10

Ease of availability 15

Brand image of the product 24After sales service 32

Value for money 4

Total 100



65

The graph represents the factors influencing purchase behavior

Interpretation:

The above table and graph it is analyzed that majority of responds that is 32% influenced with

after sales services. Brand image of the product will impact the purchase behavior of consumers.

The markets will examine the purchase pattern of consumers to plan the sales promotion

programs and understanding consumer buying behavior.

Purchase Behaviour

Quality & feature

Price

Ease of availability

Brand image of the product

After sales service



66

Table 6:

Which option you prefer when you purchase a bike?

a) Onetime payment b) Financial option c) Exchange offers d) Any other.

Graph 6:

The graph represents the payment modes opted by a buyer

Opinion About Payment Mode % Of Respondents

Onetime payment 15

Financial option 65

Exchange offers 12

Other modes 8

Total 100



67

Interpretation:

The above table and graph represents pricing strategy which plays an important role in product.

Marketing strategies of the firms has to consider consumer budgetary limit to promote the

product.

Majority of the responds it is 65% opted for financial options during purchase of product like

credit sales, EMI etc

0

10

20

30

40

50

60

70

Onetime

paymentFinancial

optionExchange

offersOther

modes

Payment Modes

% Of Respondents



68

Table 7:Who was the decision maker in your purchase of motor bike?

a) Parents b) Friends c) Yourself d) Spouse e) Other

Graph 7:

Opinion About Purchase Decision % Of Respondents

Parents 15

Friends 35

yourself 22

spouse 8others 20

Total 100



69

The graph represents the purchase decision maker for the bike

Interpretation:

The above table and graph represents majority of the customers accepted that their purchase

decisions are majorly influenced by friends.

Table 8:

Which physical features contributed most in you buying decision?

a) Looks b) Body build c) Style e) Robustness

Graph 8:

The graph represents the physical features contributed most in buying decision

0

5

10

15

20

25

30

35

ParentsFriends

yourself spouseothers

purchase decions

% Of Respondents

Opinion About Physical Features % Of Respondents

Looks 35

Body build 25

Style 22

Robustness 18Total 100



70

Interpretation: The above table and graph represents the consumer behavior which is influenced with physical

attributes.

The marketing mix strategy majorly includes product decisions to satisfy the consumer

expectations.

Product includes combination of tangible and intangible benefits.

The potential product should attribute and hold consumers.

Form the survey majority responds that is 35% accepted for purchase decisions based on

physical attributes.

Physical Features

Looks

Body build

Style

Robustness



71

Table 9:

What technological feature effected in your buying decision?

a) Power – economy mode b) Mileage c) Four stroke engine d) Any other

Graph 9:

The graph represents the technical features contributed most in buying decision:

Opinion About Technical Attributes % Of Respondents

Power – economy mode 22

Mileage 48

Four stroke engine 18

Any other 12Total 100



72

Interpretation:

The above table and graph represents technical features which contributes buying decisions of

motor bikes.

Majority of responds that is 48% accepted that mileage is the important attributes for motor

bikes.

The purchase decisions also include other technical attributes and their efficiency.

Technical Features

Power – economy mode

Mileage

Four stroke engine

Any other



73

Table 10:

From where did you purchase your bike?

a) Authorized outlet b) Near-by dealer c) Online d) Any other

Graph 10:

The graph represents the sources where purchase is made:

Opinion About Purchase Sources % Of Respondents

Authorized outlet 47

Near-by dealer 33

Online 13

Any other 7Total 100



74

Table 11:

Which brand has better after sales service?

a) Bajaj Caliber b) Passion c) TVS victor d) Ambition e) LML Freedom f) Other.

Graph 11:

The graph represents the sources where purchase is made:

Purchase Sources

Authorized outlet

Near-by dealer

Online

Any other

Opinion About After Sales Service % Of Respondents

Authorized outlet 47

Near-by dealer 33

Online 13

Any other 7

Total 100



75

Table 12

2009-2010 SALES ANALYSIS

fter Sales Services

Authorized outlet

Near-by dealer

Online

Any other

PRODUCTS 2009-2010

SALES

CD DELUX 310

SPL PLUS 1395

PASSION PLUS 169

PASSION PRO 1880

SPLEDOR NXG 25

SUP. SPLENDOR 10



76

INTERPRETATION:

From the below sales analysis it was understood that, sales of 2009-2010 are 5185. The

company is giving more importance to promotional activities by conducting melas and

giving huge discounts. And customers also attracted towards to these products for

mileage efficiency, better pickup & good price.

GRAPH: 12

GLAMOUR 490

GLAMOUR FI 0

CBZ EXTREME 455

HUNK 25

KARIZMA 1

PLEASURE 230

SPLENDOR PRO 195

TOTAL 5185



77

310

1395

169

1880

25 10

490

0

455

25 1

230 195

0

200

400

600

800

1000

1200

1400

1600

1800

2000

2009-2010 sales

2009-2010 sales



78

TABLE-13


PRODUCTS 2010-2011 SALESCD DELUX 359

SPL PLUS 1435

PASSION PLUS 200

PASSION PRO 2087

SPLEDOR NXG 30

SUP. SPLENDOR 11

GLAMOUR 510

GLAMOUR FI 0CBZ EXTREME 479

HUNK 29

KARIZMA 3

PLEASURE 246

SPLENDOR PRO 241

TOTAL SALES 5608

INTERPRETATION:

From the above sales analysis it was understood that sales of SPL plus & Passion pro are

very high compared to other products. The company is giving more importance to these

two products in promotional activities by conducting melas and giving discounts. And

customers also attracted towards to these two products for mileage efficiency. And

company spent huge amount to advertisements, which attracts the customers when

compared to previous year.



79

GRAPH: 13

359

1435

200

2087

30 11

510

0

479

29 3

246 241

0

500

1000

1500

2000

2500

2010-2011 SALES

2010-2011 SALES



80

TABLE 14


PRODUCTS 2011-2012SALES

CD DELUX 272

SPL PLUS 1255

PASSION PLUS 383

PASSION PRO 1795

SPLEDOR NXG 85

SUP. SPLENDOR 117

GLAMOUR 631

GLAMOUR FI 0

CBZ EXTREME 332

HUNK 29

KARIZMA 17

PLEASURE 319

SPLENDOR PRO 0TOTAL 5235

INTERPRETATION:

From the above analysis it was understood that the sales has been decreased from 5600 to 5235

in 2011-2012 year. The company has reduced its promotional campaigns when compared to the

previous year. And another reason is hero and Honda both companies are breakup their

agreement and established separately their manufacturing units. This has also shown impact on

the sales.



81

GRAPH-14

272

1255

383

1795

85 117

631

0

332

29 17

319

00

200

400

600

800

1000

1200

1400

1600

1800

2000

2011-2012 SALES

2011-2012 SALES



82

TABLE 15

COMPARISON BETWEEN 2009-10 SALES & 2010-11 SALES

S.NO PRODUCTS 2009-10 2010-11 DIFFERENCE1 CD DELUX 310 359 49

2 SPL PLUS 1395 1435 40

3 PASSION PLUS 169 200 31

4 PASSION PRO 1880 2087 207

5 SPLEDOR NXG 25 30 5

6 SUP. SPLENDOR 10 11 1

7 GLAMOUR 490 510 20

8 GLAMOUR FI 0 0 0

9 CBZ EXTREME 455 479 24

10 HUNK 25 29 4

11 KARIZMA 1 3 2

12 PLEASURE 230 246 16

13 SPLENDOR PRO 195 241 46

14 TOTAL 5185 5608 423

INTERPRETATION:

From the year 2009-2010 the sales have been increased from 5185 to 5608 in 2010-2011.

Because in the year 2009-2010 the company given huge discounts to the customers in purchasing

their products. This result shows 5185 sales in that year. But in 2010-2011 the Company mainly

focused on Advertisements & free service campaigns which are created awareness to the

customers about Hero products. This result shows 5608 sales in that year.



83

GRAPH 15

0

500

1000

1500

2000

2500

A x i s T i t l e

Axis Title

2009-10

2010-11



85

GRAPH: 16

0

500

1000

1500

2000

2500

2010-2011

2011-2012



87

GRAPH: 17

349523

1213595

50955106207

57767

0

200000

400000

600000

800000

1000000

1200000

1400000

2009-2010

advertisements

discounts

melas

free services

other promotion exp



89

GRAPH 18:

395884

4797134020

115448 115413

0

50000

100000

150000

200000

250000

300000

350000

400000

450000

2010-2011

ADVERTISEMENTS

DISCOUNTS

MELAS

FREE SERVICES

OTHER PROMOTIONEXPENDITURE



90

TABLE-19

BUDGET ALLOCATION FOR PROMOTIONAL ACTIVITIES IN THE

YEAR 2011-2012

INTERPRETATION:

In the year 2011-2012 the company has been spent huge amount for promotional activities i.e.

for advertisements, discounts, melas, free services, and other promotional activities. The total

amount spent by the company was 7, 13, 056/-. In this amount, majority of amount is only spent

in the form of advertisements i.e. 3, 53, 336/-. And this results the sale of 5235 products in that

annual year.

PARTICULARS

FOR THE PERIOD

2011-2012

AMOUNT(Rs)

ADVERTISEMENTS 353336

DISCOUNTS 13783

MELAS 148551

FREE SERVICES 151357

OTHER

PROMOTION

EXPENDITURES

46029

TOTAL AMOUNT 713056



91

GRAPH-19:

353336

13783

148551151357

46029

0

50000

100000

150000

200000

250000

300000

350000

400000

2011-2012

ADVERTISEMENTS

DISCOUNTS

MELAS

FREE SERVICES

OTHER PROMOTION

EXPENDITURES



92

TABLE-20

Amount spent for promoting two wheelers

YEARS Total amount for promotional

activities (Rs)

2009-2010 1778047

2010-2011 708736

2011-2012 713056

INTERPRETATION :

From the above table we understood that, the company is giving more importance to promote its

products by allocating budgets to promotional activities every year.In the year 2009-2010

company has been spent Rs 17,78,047/- only for promotional activities. But it was reduced to Rs

7, 08,736/- in the next year. Because in the year 2009-2010 company has been spent huge

amount only by giving discounts but it has been reduced in 2010-2011 & 2011-2012 years. In

these years company has spent huge amount for advertisements only. And this results more sales

compared to 2009-2010 year.



93

GRAPH-20:

1778047

708736 713056

0

200000

400000

600000

800000

1000000

1200000

1400000

1600000

1800000

2000000

2009-2010 2010-2011 2011-2012

Total amount spent for promotional activities (In Rs)

Total amount for promotional

activities



94

SUMMARY

During the 80s, Hero Moto Corp (previously Hero Honda) became the first company in

India to prove that it was possible to drive a vehicle without polluting the roads. The company

introduced new generation motorcycles that set industry benchmarks for fuel thrift and low

emission. A legendary 'Fill it - Shut it - Forget it' campaign captured the imagination of

commuters across India, and Hero Moto Corp (previously Hero Honda) sold millions of bikes

purely on the commitment of increased mileage. In today world customer is the king irrespective

of whatever the business may be, wherever the operations may be.

Good business organizations known by its strong customer loyalty, which turns to

become a unified family. The project assigned to me by the company was a market mix study on

100cc bikes among the dealers with special reference to Hero Moto Corp (previously Hero

Honda) dealers.

The objective of the study was to find out the dealers opinion about the100cc bikes with

special reference to Hero Moto Corp (previously Hero Honda) dealer to understand how market

fluctuations affect their strategic decision. Different models Hero Moto Corp (previously Hero

Honda) vehicles can be introduced for ladies, with better comfort, speed and power, so that it can

cater to the changing tastes of women.

More service stations should be established in every part of the city, so those customers

have an easy accessibility. With a strong sales and service network of 650 Authorized dealership,

1500 authorized service centers and over 1000 certified service points, Hero Moto Corp

(previously Hero Honda) is growing from strength to strength. Hero Moto Corp (previously Hero

Honda) motor should also start producing other models and should add a different style and

variety to their product line. This will surely attract more customers. This will help to increase

the existing goodwill and position in the market. The experience gained during the analysis and

drawing inferences was an exciting and informative exercise under the guidance of unit head



SUGGESTIONS

After doing market research I would like to suggest or recommend to the Company that

there are certain outcomes of research, which followed through the formal and informal

procedure during the research. Thus we are bound to draw the attention of Company to certain

points which are ought to be perceived by the Company with full care.

Publicity and advertisement should be broad, because competition is more. Size and

weight of bike should be match with their C.C. Company should follow worldwide strategies for

increasing their global revenue. Bike should have stepping facility which may help during

critical situation.

Company should provide promotional schemes to the customers. Now Company is

required to recover the faith of customers towards the brand image. Company should improve

the mileage of the Bikes. Prices of the Bike must be set as it can be approved by major part of the

population.

Fuel tank portion can be changed Hero Moto corp. introducing the new products and they

want to produce different sizes of products. They are producing different bikes based on

customer requirements to increase sales and set the market demand.

The market pricing feedback must reach basic users and middlemen‘s in a structured

manner to make the pricing decision effectively and to ensure competitive price. More

distribution centers are to be appointed.

market mix chapter 1-5 revised (1)

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