A case study on:-

Success of Maruti Suzuki in small segment cars

Reasons for which maruti continues to be the leader of small segment cars every year

Wide Product offerings at different price points: . Suzuki has launched various models in various segments and hence has a very good product mix of offerings as different price points Right from the affordable Alto to the high end SX4, the company seems to have it all. Maruti has an edge over its competitors in this aspect.

Efficient distribution: The first principle of economics is that if you generate demand, you should have the availability of the product to cater to the demand. There are many distribution centres of Maruti Suzuki within any city in India. Even in the remotest of corner, there will be a Maruti sales outlet . To add to it Maruti Suzuki has the highest number of service centres across the country The company seems to have the structure to succeed.

◦ Marketing strategy of cannibalization — In marketing, cannibalization refers to decrease in sales volume or market share of one of the product due to introduction of a new product by the same producer. Maruti-Suzuki believes in the concept of cannibalization. For instance, if the customer’s budget is on a lower side, he/she may purchase an Alto instead of a Wagon-R. therefore, the sales still remain with Maruti. So Maruti ensures that the customer instead of going to any of its competitors stays with Maruti-Suzuki.

◦   Excellent mileage, focussed advertisements - Maruti-Suzuki cars are loved for their superb mileage,it cuts the overall running cost of the vehicle ensuring that the customer is spoilt for this particular brand. It is also one of the first companies in India to focus on advertising the engine specifications. i.e. the K-series engine. The advertisements of Maruti Suzuki focuses on Maruti being a value buy.

◦   Long Association with India — The company has been associated with the Indian population for more than 40 years. Right from the now defunct in terms of production, but ever popular Maruti 800 to high end vehicles the company seems to have established a strong bond with the Indian population. Younger India in their budding years has travelled a lot in this car with their parents. So they want to take the legacy forward.

◦ Lowest TCO ( Total Cost of Operation) - Both the capital cost and the parts cost are quite cheap compared to the other competitiors.

◦ Economy with technology: Maruti Suzuki’s cars have always seen as a company producing cars blending economy with technology. Swift’s initiative of putting a 16-bit microprocessor on board has proved as one of the major reasons for its success and that too for the lowest price in its segment.

Company’s focus on the middle class - The company through its cars like A-Star, wagon R, Swift, & Swift Dzire focuses on the middle class whose purchasing power is rising by the day.

Shift of the co. towards diesel oriented cars — This has been a strategic decision taken by the company. 60% of the cars manufactured by the company are of diesel engines. The variants of Swift, Swift Dzire & SX4 diesel variants are very successful.

Focus on rural markets  — Currently, about 26% of Maruti’s sales come from the rural India. After the 2009 economic meltdown, Maruti Suzuki started concentrating more on the rural markets. Campaigns like Ghar Ghar Mein Maruti’ and ‘Mera Sapna Meri Maruti’ targeted to the rural India have augured well for the company.

Brand Name : Maruti Suzuki has emerged as a strong brand name in recent times. Backed with the parent company Suzuki. It is recognized as a strong player in worldwide automotive market.