project reportONSTUDY OF MARKETING STRATEGIES OFMARUTI SuzukiSubmitted in Partial fulfillment of the requirements of Bachelor of Business Administration (BBA)

ACKNOWLEDGEMENTS

I owe my sincere thanks and gratitude to _______________who inspired me by his able guidance and was a constant guiding light during the course of project study.The support and knowledge provided by him has been a great value addition for me and will go a long way in building a promising career.Last but not least, I am also thankful to all the respondents of my survey without whom the project would not have been completed successfully.

INDEX

INTRODUCTION OF THE COMPANY

OBJECTIVE OF THE COMPANY

RESEARCH METHODOLOGY

LIMITATIONS

CONCLUSION

BIBILIOGRAPHY

INTRODUCTION OF THE COMAPANYMARUTI UDYOG LIMITEDMaruti is India's largest automobile company. The company, a joint venture with Suzuki of Japan, has been a success story like no other in the annals of the Indian automobile industry. Today, Maruti is India's largest automobile company. This feat was achieved by the missionary zeal of our employees across the line and the far-sighted vision of our management. The Company Mission: To provide a wide range of modern, high quality fuel efficient vehicles in order to meet the need of different customers, both in domestic and export markets. The Company Vision: We must be an internationally competitive company in terms of our products and services. We must retain our leadership in India and should also aspire to be among the global players. Their focus is on: Building a continuously improving organisation adaptable to quick changes Providing value and satisfaction to the customer Aligning and fully involving all our employees, suppliers and dealers to face competition Maximising Shareholder's value Being a responsible corporate citizen At Maruti, they have a clear perspective on manpower. They see it as a unique resource, in the sense that optimal productivity of other resources depends largely on the way human resources are utilised. The basic philosophy of management that underlies the Maruti culture is that all employees of the company should be moulded into a team which then strives as one, to achieve commonly shared company goals and objectives. To make this philosophy tenable, the Company takes several initiatives. Inputs are sought from employees at all levels. They believe that everyone should contribute to the formulation of company policies, goals and objectives. Secondly, at Maruti, they encourage leadership in the best sense of the word. According to us, a leader is one who must be impartial, must have the ability to rise above his own subjectivity, and, most importantly, must practice what he preaches. They understand that the process of creating a sense of belonging that all employees can identify with is a lengthy one. To ensure that this translates into concrete reality, they have taken several simple but specific and well thought out measures. The first step in this direction has been the introduction of a common uniform for all employees. Another measure is the creation of a common canteen where all employees have lunch, stand in common queues, and sit on the same table. Common toilets, common transport and similar facilities for all levels of employees are other measures that reinforce their emphasis on genuine equality in the workplace. At Maruti They do not believe in the notion of organisational hierarchies. As a matter of fact, the management structure and systems in Maruti have been designed to promote decentralisation of authority. Maruti has a horizontal management structure with only four functional levels of responsibility to facilitate quicker decision making. Another focus area of the Maruti culture is the maintenance of a smoothly functioning communication network. Maruti believes that communication channels between labour and management cannot simply consist of having a labour representative on the Board of the Company. They have faith in the ability of labour to effectively participate in management and make constructive suggestions. To encourage this, they ensure that there is a thorough dissemination of information at all levels, through newsletters or via a letter from the Chief Executive to all employees. Meetings with the Union are held regularly, and programmes being contemplated by the Company are discussed with the Union. The Sahyog Samiti, a collection of representatives of non-unionised employees, training programmes in Japan, Quality Circles, productivity-linked incentive schemes, and an ethos of discipline and teamwork, all contribute to the Maruti culture. Several measures of performance have made amply clear that Maruti has established a truly healthy work culture. They have met all project and performance targets since inception. Their productivity levels are constantly improving. The Company has had good labour relations with employees from the very beginning, and they have been successful in the export market. Yet, the Maruti culture is one that does not believe in resting on its laurels. They adhere to the spirit of Kaizen, which states that constant improvement is always possible. The most basic tenet of productivity that they hold dear is that " Today should be better than Yesterday and Tomorrow should be better than Today".Maruti Udyog Limited (MUL) was established in Feb 1981 through an Act of Parliament, to meet the growing demand of a personal mode of transport caused by the lack of an efficient public transport system. Suzuki Motor Company was chosen from seven prospective partners worldwide. This was due not only to their undisputed leadership in small cars but also to their commitment to actively bring to MUL contemporary technology and Japanese management practices (which had catapulted Japan over USA to the status of the top auto manufacturing country in the world). A licence and a Joint Venture agreement was signed between Government of India and Suzuki Motor Company (now Suzuki Motor Corporation of Japan) in Oct 1982. The objectives of MUL then were: Modernization of the Indian Automobile Industry. Production of fuel-efficient vehicles to conserve scarce resources. Production of large number of motor vehicles, which was necessary for economic growth. Core Value Customer Obsession Fast, Flexible and First Mover Innovation and Creativity Networking and Partnership Openness and Learning Vision The leader in the India Automobile Industry, Creating Customer Delight and Shareholders Wealth; A pride of IndiaTechnological Advantage We have introduced the superior 16 * 4 Hypertech engines across the entire Maruti Suzuki range. This new technology harnesses the power of a brainy 16-bit computer to a fuel-efficient 4-valve engine to create optimum engine delivery. This means every Maruti Suzuki owner gets the ideal combination of power and performance from his car.Our other innovation has been the introduction of Electronic Power Steering (EPS) in select models. This results in better and greater maneuverability. In other words, our cars have become even more pleasurable to drive.Production/R&D Spread over a sprawling 297 acres with 3 fully-integrated production facilities, the Maruti Udyog Plant has already rolled out over 4.3 million vehicles. In fact, on an average, two vehicles roll out of the factory every minute. And it takes on an average, just 14 hours to make a car. More importantly, with an incredible range of 11 models available in 50 variants, there's a Maruti Suzuki made here to fit every car-buyer's budget. And dream.

Timeline of Maruti Suzuki

1970 A private limited company named 'Maruti technical services private limited' (MTSPL) launched on November 16, 1970. The stated purpose of this company was to provide technical know-how for the design, manufacture and assembly of "a wholly indigenous motor car".1971 In June, A company called 'Maruti limited' was incorporated under the Companies Act and Sanjay Gandhi became its first managing director. 1977 'Maruti limited' goes into liquidation.1978 A commission of inquiry headed by Justice A. C. Gupta, which probed the 'Maruti scandal', submits its report. 1980 On June, 23'rd, Sanjay Gandhi dies when a private test plane he was flying crashed.1981 The Indian Central government at the behest of Indira Gandhi salvages Maruti limited and starts looking for an active collaborator for this company. Maruti Udyog Ltd was incorporated under the provisions of the Indian Companies Act, 1956 1982 License and Joint Venture Agreement(JVA) signed between Maruti Udyog Ltd. and SMC of Japan1983 Maruti 800, a 796 cc hatchback, Indias first affordable car, is released in the market. Production was started under the JVA commences.1984 Omni, a 796cc MUV, released. Installed capacity of the plant in Gurgaon, reaches 40,000 units1985 Launch of Maruti Gypsy (970cc, 4WD off-road vehicle)1986 Maruti 800 ( New Model-796cc, hatchback Car) 100,000 vehicles produced by the company. [2]1987 The company's first export, when a lot of 500 cars were sent to Hungary.1988 Installed capacity is increased to 100,000 units in Gurgaon.1989 Maruti 1000(970cc, 3 box), Indias first contemporary sedan is released into the market.1991 65 percent of the components, for all vehicles produced, are indigenised (produced locally) Liberalisation of the Indian economy opens new opportunities but also brings more competition to segment.1992 Suzuki increases its stake in Maruti to 50 percent, making the company a 50-50 JV with the Government of India the other stake holder.1993 Zen(993cc, hatchback Car), which was later exported in Europe and elsewhere as the Alto1994 Esteem1.3L (1298cc, 3 box car) LX released in market, Maruti's second sedan model. Produced the 1 millionth vehicle since the production commenced. The first company in India to do so.1995 Esteem1.3L (1298 cc, 3 box car) VX released in market. Maruti 1000 production of Maruti 1000 stopped. Second plant opened , installed capacity reached 200,000 units1996 Five new models lanched: Gypsy (E) (970cc, 4WD 8 seater) Omni (E) (796cc, MUV, 8 seater) Gypsy King (1298cc, 4WD, off road vehicle) Zen Automatic (993cc, hatchback car) Esteem 1.3L (1298 cc, 3 box Car) AX Launch of 24-hour emergency on-road vehicle service, the first of its kind in the country. United Front government formed, Murasoli Maran new Industries Minister.1997 Government nominated Mr. S.S.L.N. Bhaskarudu as the Manging Director on August 27, as the then current Managing director, R.C.Bhargava, was completing his tenure. Creating a conflict with Suzuki 1998 Esteem (1299cc, 3 box car) LX, VX and AX models released. New Maruti 800 (796cc, hatchback Car) Standard and Deluxe released, the first change in design since 1986. Two million vehicles produced.1998 Zen D (1527 cc diesel, hatchback car) model released. Zen VX & Zen VX Automatic model released. New (Omni & Omni E) (796cc, MUV) model released.1999 Six new releases: Maruti 800 EX ( 796cc, hatchback car) Zen LX (993cc, hatchback car) Zen VXi (993cc, hatchback car with power steering) Omni XL ( 796cc, MUV, high roof) Baleno (1600cc, 3 Box Car) released. Advertised as 'Maruti Suzuki Baleno' Wagon R launched in market.2000 First car company in India to launch a Call Center for internal and customer services. New Alto model released. Altura, a luxury estate car released into the market. IDTR (Institute of Driving Training and Research) launched jointly with the Delhi government to promote safe driving habits2001 Zen LXi Maruti True Value launched in Bangalore and Delhi Maruti Versa, Indias first luxury multi-purpose vehicle launched. Alto Spin LXi, with electronic power steering Alto Vxi Customer information centers launched in Hyderabad, Bangalore and Chennai2002 WagonR Pride Esteem Diesel. All other variants upgraded Maruti Insurance. Two new subsidiaries started: Maruti Insurance Distributor Services and Maruti Insurance Brokers Limited Alto Spin LXi, with electronic power steering Special edition of Maruti 800, Indias first colour-coordinated car Maruti True value in Mumbai Maruti Finance in Mumbai with 10 finance companies Suzuki Motor Corporation (SMC) increases its stake in Maruti to 54.2 percent2003 New Suzuki Grand Vitara XL-7 Redesigned and all-new Zen New upgraded WagonR Enters into partnership with State Bank of India 4 million vehicles Produced since start of production. Maruti Udyog Ltd is Listed on BSE and NSE after a public issue, which is oversubscribed 10 times.2004 New (non A/C) variant of Alto released. Alto becomes India's new best selling car overtaking Maruti 800. LPG variant of 'Omni Cargo' Versa 5-seater, a new variant created Baleno LXi, a new variant created Esteem undergoes cosmetic changes and is re-launched with a price cut. Maruti Udyog closed the financial year 2003-04 with an annual sale of 472122 units, the highest ever since the company began operations 20 years ago2005 The fiftieth lakh (5 millionth) car rolls out in April, 2005 Growth in overall sales by 15.8% Suzuki Swift(1298cc 87 BHP 4Dr Hatch) Introduced into the Indian Market.

Milestones Achieved by Maruti Suzuki2009 MSIL adopts voluntary fuel disclosure A-Star bags, Zigwheels Car of the Year A-Star rated best car of the year - Autocar UTVi2008 World premiere of concept A-Star at 9th Auto Expo, New Delhi 2005 Number one in JD Power SSI for the second consecutive year Number one in JD Power CSI for the sixth time in a row - the only car to win so many times M800, WagonR and Swift topped their segments in the TNS Total Customer Satisfaction Study Leadership in the JD Power Initial Quality Study - Alto number one in its segment for the 2nd time in a row, Esteem number one in its segment for the 3rd year in a row, Swift number one in the premium compact segment WagonR and Esteem top their segments in the JD Power APEAL study TNS ranks Maruti 4th in the Corporate Reputation Strength (CSR) study (#1 in Auto sector)-Feb 05 Maruti bagged the "Manufacturer of the year" award from Autocar-CNBC ( 2nd time in a row)-Feb 05 First Indian car manufacturer to reach 5 million vehicles sales2004 Business World ranks Maruti among top five most respected companies in India-Oct 04 Maruti ranked among top ten (Rank7) greenest companies in India by Business Today - Sep '04 Maruti Suzuki was No. 1 in Customer atisfaction, No. 1 in Sales Satisfaction No.1 in Product Quality (Esteem and Alto) and No. 1 in Product Appeal (Esteem and Wagon R) No. 1 in Total Customer Satisfaction (Maruti 800, Zen and Alto) Business World ranked us among the country's five most respected companies Business World ranked us the country's most respected automobile company Voted Manufacturer of the year by CNBC Voted one of India's Greenest Companies by Business Today-AC Nielson ORG-MARG2003 Maruti 800, Maruti Zen and Maruti Esteem make it to the top 10 automotive brands in "Most Trusted Brand survey 2003" J D Power ranked 3 models of Maruti on top: Wagonr, Zen and Esteem Maruti 800 and Wagonr top in NFO Total Customer Satisfaction Study 2003. MUL tops in J D Power CSI (2001) for 4th time in a row2001 MUL tops in J D Power CSI (2001) for 2nd time in a row: another international first2000 Maruti bags JD Power CSI - 1st rank; unique achievement by market leader anywhere in the world1999 MSM launched as model workshop in India; achieves highest CSI rating. Central Board of Excise & Customs awards Maruti with "Samman Patra", for contribution to exchequer and being an ideal tax assessee1998 CII's Business Excellence Award1996 Maruti wins INSSAN award for "Excellence in Suggestion Scheme" Awarded the Star Trading House status by Ministry of Commerce1994-95 Engineering Exports Promotion Council's award for export performance1994 Best Canteen award among Haryana Industries as part of employee welfare1992-93 Engineering Exports Promotion Council's award for export performance1991-92 Engineering Exports Promotion Council's award for export performance

WHY MARUTI SUZUKIThe Quality AdvantageA car is an engineering product, only as good as the technology used to make it. Actual users of our technology are saying something very clearly Maruti Suzuki is No.1 in quality:Maruti Suzuki owners experience fewer problems with their vehicles than any other can manufacturer in India (J.D. Power IQS Study 2004). The Alto was chosen No.1 in the premium compact car segment and the Esteem in the entry level mid-size car segment across 9 parameters.The J.D. Power APEAL Study 2004 proclaimed the Wagon R. No. 1 in the premium compact car segment and the Esteem No.1 in the entry level mid-size car segment. This study measures owner delight in terms of design, content, layout and performance of vehicles across 8 parameters.Maruti Suzuki has a sales network of 307 state-of-the-art showrooms across 189 cities*, with a workforce of over 6000 trained sales personnel to guide our customers in finding the right car. Our high sales and customer care standards led us to achieve the No.1 nameplate in the J.D. Power SSI study 2004. The SSI study measures sales satisfaction across 6 parameters: deal received, paperwork, dealer facility, salesperson, delivery timing and delivery process. Maruti Suzuki has not only got the No.1 nameplate in the J.D. Power SSI study 2004, but also ranked way above the industry average (Maruti Suzuki was at 784 while industry average was at 760). What is significant is that it was ranked above Skoda, Ford, Chevrolet, Mitsubishi and Hyundai. To be really happy with the car you own, it should have a reliable service network at hand and within easy reach. Their 1036 city strong service network is equipped to service 20,000 vehicles a day. No wonder Maruti Suzuki has been awarded the No.1 nameplate in customer satisfaction in India for the fifth year in a row, a feat unprecedented for any automobile market leader in the world.In the J.D. Power CSI study 2004, Maruti Suzuki scored the highest across all 7 parameters: least problems experienced with vehicle serviced, highest service quality, best in-service experience, best service delivery, best in-service experience, most user-friendly service and best service initiation experience.In fact, 92% of Maruti Suzuki owners feel that work gets done right the first time during service. The J.D. Power CSI study 2004 also reveals that 97% of Maruti Suzuki owners would probable recommend the same make of vehicle, while 90% owners would probable repurchase the same make of vehicle.A Buying Experience Like No OtherMaruti Suzuki has a sales network of 307 state-of -the-art showrooms across 189 cities, with a workforce of over 6000 trained sales personnel to guide our customers in finding the right car. Our high sales and customer care standards led us to achieve the No.1 nameplate in the J.D. Power SSI Study 2004.Quality Service Across 1036 CitiesIn the J.D. Power CSI Study 2004, Maruti Suzuki scored the highest across all 7 parameters: least problems experienced with vehicle serviced, highest service quality, best in-service experience, best service delivery, best service advisor experience, most user-friendly service and best service initiation experience.92% of Maruti Suzuki owners feel that work gets done right the first time during service. The J.D. Power CSI study 2004 also reveals that 97% of Maruti Suzuki owners would probably recommend the same make of vehicle, while 90% owners would probably repurchase the same make of vehicle.One Stop ShopAt Maruti Suzuki, you will find all your car related needs met under one roof. Whether it is easy finance, insurance, fleet management services, exchange- Maruti Suzuki is set to provide a single-window solution for all your car related needs.The Low Cost Maintenance AdvantageThe acquisition cost is unfortunately not the only cost you face when buying a car. Although a car may be affordable to buy, it may not necessarily be affordable to maintain, as some of its regularly used spare parts may be priced quite steeply. Not so in the case of a Maruti Suzuki. It is in the economy segment that the affordability of spares is most competitive, and it is here where Maruti Suzuki shines. The recent Auto car Survey conducted in August 2004 bears testimony to this fact. In the Maruti Suzuki stable, the Omni has the lowest aggregate cost of spares followed by the Maruti-800. The Maruti-800 has the cheapest spares of any Indian car with a basket of just Rs. 23,422. In the Lower Mid-size segment as well, price-consciousness is very high, where the cars have to be not only affordable on purchase price but also need to combine quality, drivability and have comfortable interiors. In this segment, the Maruti Suzuki Versa has scored particularly well with the lowest cost of spares in the segment. In the Upper Mid-size segment, the Maruti Suzuki Baleno has the segment's lowest prices on a majority of the spares.Lowest Cost of OwnershipTo be really happy with the car one owns, it should be easy on the pocket to buy and to run-which is why the cost of ownership is so important. And here again, a Maruti Suzuki is a clear winner, as shown by the recent J.D.Power CSI study 2004. It is clear that a Maruti Suzuki delights you even when you run it for years. The 6 highest satisfaction ratings with regard to cost of ownership among all models are all Maruti Suzuki vehicles: Zen, Wagon R, Esteem, Maruti 800, Alto and Omni. They are proud to have the lowest cost of operation / km (among petrol vehicles) - the top 5 models are all Maruti Suzuki models: Maruti 800, Alto, Zen, Omni and Wagon R.Employee Quality Measures Kaizen is based on the concept of making incremental improvements in our products. It incorporates a series of continuous small and simple improvements, which aim at involving employees at all levels. The Suggestion Scheme is based on the same principle. Under this scheme, employees are encouraged to make suggestions for improvement in any area of our operation. Over 50,000 suggestions are received from employees every year. Maruti has won the First place in "Excellence in Suggestion Scheme Contest 2003", which is the 6th consecutive award won in as many years. This contest is organized by Indian National Suggestion Schemes Association (INSSAN). Since 1998 Maruti has won this award 10 times. "Quality Circles" are groups of five to eight members from a particular work area who work as a team to identify priorities and solve work related problems in the area. We believe that it is this unwavering commitment to quality that will lead to the further growth of the organization as competition increases. ISO 9001:2000At Maruti, our approach to quality is in keeping with the Japanese practice--"build it into the product". Technicians themselves inspect the quality of work. Supervisors educate and instruct technicians to continually improve productivity and quality. The movement of quality indicators is reviewed in weekly meetings by the top management. In 2001, Maruti Udyog Ltd became one of the first automobile companies anywhere in the world to get an ISO 9000:2000 certification. AV Belgium, global auditors for International Organization for Standardisation(ISO), certified Maruti after a four day long audit, covering varied parameters like Customer Focussed organisation, Leadership, Involvement of people, Process approach, System approach to Management, Continual improvement, etc. In May 1995, Maruti got ISO 9002 certification. The audit for this covered quality assurance in production, installation, marketing and sales as well as after sales services. We were also one of the first companies in the world to pioneer ISO 9000 certification for our dealers. In October 1993, MUL passed the Conformity Of Production (COP) Audit, which is based on a European Union Directive. This authenticated our quality systems and testing facilities for export to Europe. Their emphasis on total quality has meant that today they are in a position to guide vendors and dealers in establishing and consolidating their individual quality systems. This commitment to quality has ensured a consistently satisfying product and world-class sales and after-sales services.

TS16949:2002 - A new feather was added recently in Marutis cap in the field of quality when the Quality Management System of its Press Shop & associated functions (collectively termed as Press Function) got certification for conformance to the requirements of TS16949:2002 standard.The need for TS certification of Press Function had its genesis in the prestigious project that Maruti earned for the supply of stamped panels to General Motors India for one of its forthcoming models.As a part of Quality system requirements, GM requires all its suppliers to be certified to either ISO TS 16949 or QS 9000.These standards address Quality System requirements, which are particularly specific to the automotive industry and requires an organization to be in compliance with ISO 9000 systems as a basic requirement. However, whereas QS 9000 would become defunct and cease to exist after Dec 2006, TS 16949 is going to be the standard of the future.The TS 16949 standard, brought out by ISO in the year 1999, is an extension of the ISO 9001:2000 standard that prescribes Quality management system requirements that are specifically applicable to the automotive industry.TS 16949 has gained high popularity and almost all major automobile players across the globe including GM, Ford, Daimler Chrysler, Nissan, Honda are embracing & promoting it.

THEORITICAL PERSPECTIVEConsumer is strictly, the ultimate consumer of a product, the ultimate user of a product; the person who derives the satisfaction or the benefit offered. The 'consumer' is not necessarily the customer, since there are often 'customers' in the buying/ distribution chain; moreover, the consumer is frequently not the person who makes the buying decision; for instance, in the case of many household products, where the housewife may make the purchase but consumption or use is by the whole family. 'Consumer' is not normally applied to the purchase of industrial goods and services where the customer is usually a corporate body. Nevertheless, consumable goods are sold to industry for corporate purposes and the consumers of these goods can be identified for marketing practice.Consumer behavior is the study of buying habits or patterns of behaviour of consuming public either in general or in specific groups.The Buying ProcessThe complexity inherent in understanding consumer behaviour has led to the construction of models of the buying process which indicate the stages through which the consumer passes from the time he or she first becomes aware of a need for a product or service to the time when a product is purchased, a brand selected, and the consumer evaluates the success of his purchase decides whether to buy that particular product and / or brand again. It the same time, such models usually indicate the social and psychological forces which shape the potential buyer's action at each stage in the process. The two principal aims of such model building are the prediction of future behavior based on measurement of relevant variable and the explanation of this behavior in terms of theoretically relevant constructs.

The starting point for understanding the buyer is the stimulus-response model shown below Marketing stimuliOther stimuliBuyer's CharacteristicsBuyer's decision processBuyer's decisions

Product Price Place Promotion Economic Technological Political Cultural Cultural Social Personal Psychological Problem recognition Information search Evaluation decision Post-purchase behavior Product choice Brand choice Dealer choice Purchase timing Purchase amount

Stages in Buying Decision ProcessNeed recognitionInformation searchEvaluation of alternativesPurchase decisionPost-purchase behavior

The consumer passes through five stages : Problem recognition information search, evaluation of alternatives purchase decision and post-purchase behavior. Clearly the buying process starts long before the actual purchase and has consequences long after the purchase.This model implies that consumers pass through all five stages in buying a product. But this is not the case, especially in low-involvement purchase. Consumers may skip or rreverse some stages. Thus a woman buying her regular brand of toothpaste goes directly from the need for toothpaste to the purchase decision, skipping information search and evaluation. However, we have already used the model in above, because it captures the full range of consideration that arise when a consumer facer a highly involving new purchase. We will allude again to Linda Brown and try to understand how she became interested in buying a laptop computer and the try to understand how she became interested in buying a laptop computer and stages she went through to make her final choice.Major Factors Influencing Buying behaviorCultural

Social

CultureSubcultureSocial ClassReference groupFamilyRoles and statusesPersonal

Age and life-cycle stageOccupationEconomic circumstancesLifestylePersonality and self-conceptPsychological

MotivationPerceptionLearningBeliefs and attitudesBuyer

Rogers model for the adoption and diffusion of innovationsInnovation Adoption CURVE

The innovation adoption curve of Rogers is a model that classifies adopters of innovations into various categories, based on the idea that certain individuals are inevitably more open to adaptation than others. Is is also referred to as Multi-Step Flow Theory or Diffusion of Innovations Theory.Innovators Brave people, puling the change. Innovators are very important communication.Early Adopters Respectable people, opinion leaders, try out new ideas, but in a careful way.Early Majority Thoughtful people, careful but accepting change more quickly than the average.Late Majority Skeptic people, will use new ideas or products only when the majority is using it.Laggards Traditional people, caring for the "old ways", are critical towards new ideas and will only accept it if the new idea has become mainstream or even tradition.The diffusion of innovations curve (innovation adoption curve) of Rogers is useful to remember that trying to quickly and massively convince the mass of a new controversial idea is useless. It makes more sense in these circumstances to start with convincing innovators and early adopters first. Also the categories and percentages can be used as a first draft to estimate target groups for communication purposes.Diffusion research focus was on five elements: 1) the characteristics of an innovation which may influence its adoption; 2) the decision-making process that occurs when individuals consider adopting a new idea, product or practice; 3) the characteristics of individuals that make them likely to adopt an innovation. TARGET MARKETINGTarget Marketing involves breaking a market into segments and then concentrating your marketing efforts on one or a few key segments.The beauty of target marketing is that it makes the promotion, pricing and distribution of your products and/or services easier and more cost-effective. Target marketing is the selection of customers you wish to service. The decisions involved in it are Which segments to target How many products to offer Which products to offer in which segmentsThere are three steps to targeting: Market segmentation Target choice Product positioningOne of the first things you need to do is to refine your product or service so that you are NOT trying to be 'all things to all people.Next, you need to understand that people purchase products or services for three basic reasons: To satisfy basic needs. To solve problems. To make themselves feel good.The next step in creating an effective marketing strategy is to zero in on your target market.Target marketing is one of corporate America's most effective business strategies. The idea is to increase sales by first identifying, and then targeting smaller, yet more profitable customer groups within the total market. Four Ways to Identify Target Markets 1. Geographic: The location, size of the area, density, and climate zone of your customers. 2. Demographics: The age, gender, income, family composition and size, occupation, and education of your customers. 3. Psychographics: The general personality, behavior, life-style, rate of use, repetition of need, benefits sought, and loyalty characteristics of your customers. 4. Behaviors: The needs they seek to fulfill, the level of knowledge, information sources, attitude, use or response to a product of your customers.One of the best ways to identify your target market is to look at your existing customer base. Who are your ideal clients? What do they have in common? If you do not have an existing customer base, or if you are targeting a completely new audience, speculate on who they might be, based on their needs and the benefits they will receive. Investigate competitors or similar businesses in other markets to gain insight.TARGET MARKETING Who are your best customers? Where should you direct your marketing activities? Where and how should you allocate your advertising and promotional efforts?Target Marketing, provides Focus for your business. It helps to establish critical Operational goals and defines what must be done to achieve themWhat Customers Want Marketing is more than an activity, it is an attitude Instead of trying to get customers to buy what the firm likes to make, or happens to have on hand, the marketing oriented firm tries to produce or sell what its customers want which can be sold at a profit. Do not simply throw out everything that you now have and replace goods or production machinery with completely new items. However, as you analyze your market and customer profiles, and so gain an understanding of their wants, desires, and perceived needs, you can begin to reorient your business over time to take best advantage of these new insights. Consider both the short term and long-term implications of developing and implementing the right Target Marketing strategy for your business.Customer Attitudes For a long time, people have believed that advertising can be used to change people's minds about what they want. This is an incredibly difficult process at best, and an extremely expensive one. Because of these two factors, it is a process that smaller firms simply cannot afford to pursue. Instead, it is much more productive for any size firm to tune in to target customer attitudes as they currently exist. Once they have identified the actual prevailing attitudes, they can begin to organize company resources needed to constructively address and satisfy these attitudes the key question is,"What are the existing customer attitudes?"With this as an objective, developing an understanding of existing customer attitudes becomes essential, and their identification becomes an important part of the marketing process. Once these customer attitudes, needs or preferences are identified, the entire firm can then organize itself to satisfy these needs as completely and efficiently as possible.

Target Marketing

MARUTI CULTURETheir employees are their greatest strength and asset. It is this underlying philosophy that has moulded their workforce into a team with common goals and objectives. Their Employee-Management relationship is therefore characterized by: Participative Management. Team work & Kaizen. Communication and information sharing. Open office culture for easy accessibility To implement this philosophy, they have taken several measures like a flat organizational structure. There are only three levels of responsibilities ranging from the Board Of Directors, Division Heads to Department Heads. Other visible features of this philosophy are an open office, common uniforms (at all levels), and a common canteen for all. This structure ensures better communication and speedy decision making processes. It also creates an environment that builds trust, transparency and a sense of belonging amongst employees. For Investors:Maruti Udyog Limited, a subsidiary of Suzuki Motor Corporation of Japan, has been the leader of the Indian car market for about two decades. Its manufacturing plant, located some 25 km south of New Delhi in Gurgaon, has an installed capacity of 3,50,000 units per annum, with a capability to produce about half a million vehicles.The company has a portfolio of 11 brands, including Maruti 800, Omni, premium small car Zen, international brands Alto and WagonR, off-roader Gypsy, mid size Esteem, luxury car Baleno, the MPV, Versa, Swift and Luxury SUV Grand Vitara XL7.In recent years, Maruti has made major strides towards its goal of becoming Suzuki Motor Corporation's R and D hub for Asia. It has introduced upgraded versions of WagonR Zen and Esteem, completely designed and styled in-house.Maruti's contribution as the engine of growth of the Indian auto industry, indeed its impact on the lifestyle and psyche of an entire generation of Indian middle class, is widely acknowledged. Its emotional connect with the customer continues.Maruti tops customer satisfaction again for sixth year in a row according to the J.D. Power Asia Pacific 2005 India Customer Satisfaction Index (CSI) Study.The company has also ranked highest in India Sales Satisfaction Study.The company's quality systems and practices have been rated as a "benchmark for the automotive industry world-wide" by A V Belgium, global auditors for International Organisation for Standardisation. In keeping with its leadership position, Maruti supports safe driving and traffic management through mass media messages and a state-of-the art driving training and research institute that it manages for the Delhi Government.The company's service businesses including sale and purchase of pre owned cars (TrueValue), lease and fleet management service for corporates (N2N), Maruti Insurance and Maruti Finance are now fully operational.. These initiatives, besides providing total mobility solutions to customers in a convenient and transparent manner, have helped improve economic viability of The company's dealerships.The company is listed on Bombay Stock Exchange and National Stock Exchange.MUL is a Board-managed company. Currently the directors on the Board are: Mr Shinzo Nakanishi, Chairman Mr Jagdish Khattar, Managing Director Mr Hirofumi Nagao, Joint Managing Director Mr Shinichi Takeuchi, Joint Managing Director Mr Kinji Saito, Director (Marketing and Sales) Mr Osamu Suzuki, Director Mr R C Bhargava, Director Mr S V Bhave, Director Mr Kumar Mangalam Birla, Director Mr Amal Ganguli, Director Ms Pallavi Shroff, Director Mr Manvinder Singh Banga, Director

OBJECTIVE OF THE COMPANYMarutis marketing objective is to continually offer the customer new products and services that: Reduce the customers cost of ownership of their cars; and anticipate and address the customers needs and preferences in all aspects and stages of car ownership, to provide what they refer to as the 360 degree customer experience.They sell many models with more than 50 variants in segments A, B, C, and utility vehicle segment of the Indian passenger car market. Of these, they manufacture nine models and import the Grand Vitara as a completely built unit from Suzuki in Japan. Their models and variants are designed to address the changing demands of the market and are periodically upgraded in technology, styling and features. To take advantage of the brand recognition associated with their products, they retain the brand name of the product through various stages of product upgrades over time. For example, the version of the Maruti 800 brand currently sold in the market is a significantly upgraded version, in terms of technology, design and styling, of the Maruti 800 launched in 1983.

COMPETITION MODELS

SegmentMarutiCompetition

A1 (Mini - Hatchback)M800Tata Nano

A2 (Compact - Hatchback)Zen, WagonR, Alto, SwiftHyundai Santro, i10 ,I 20& Getz; Tata - Indica Vista; Fiat- PultoSkoda- Fabia, Honda - Jazz

A3 (Mid Size)Esteem, BalenoHyundai Accent, Verna; Tata - Indigo & Petra; Honda - City; GM - Corsa, Aveo; Ford - Ikon, Fusion, & Fiesta Mahindra Logan

A4/A5/A6 (Exec./Prem./Luxury)Hyundai - Sonata; Honda Accord, Civic; GM -Optra; Ford - Mondeo; Skoda - Octavia & Lavra,Superb; Toyota - Corolla & Camry

C (Van Type)Omni, VersaTata ,Ace

MUV (Utility Vehicles)Gypsy, Grand VitaraMitsubishi - Pajero; Hyundai - Terracan & Tucson; Ford - Endeavor; Toyota - Prado & Innova; Nissan - X Trail; Honda - CRV; GM -Tavera; Tata - Sumo & Safari; Mahindra - Jeeps, Scorpio, & Bolero and Xylo

COMPETITIVE STRENGTHS

MUL believes that they are well positioned to maintain and enhance their leadership position in the small car segment in India, while continuing to offer products in most segments of the Indian market, on account of their competitive strengths, which include the following: Expertise in small car technology: As a subsidiary of Suzuki, they have access to globally respected technology in the small car segment. They have the advantage of Suzukis expertise in all aspects of small car technology and design, with respect to their products, their manufacturing processes and business practices, the development of their supply chain and the training of their personnel.Extensive product portfolio: Their diverse product range includes cars in segments A, B and C, and utility vehicles. They manufactured five out of the ten models that were sold in the combined A and B segments in India in fiscal 2002. They are the only manufacturer of cars in segment A (priced below Rs.300,000) where they have two models, the Maruti 800 and the Omni. The Maruti 800 has been the largest selling car in India for several years, and continued to have the highest sales volumes of any model, with a market share of 25.3%. The Omni, a versatile vehicle that can seat more passengers than the Maruti 800 or be used as an ambulance or cargo vehicle, had a market share of 10.5% in fiscal 2002. They are also the only manufacturer to sell three distinct models, the Zen, the Alto and the Wagon R, in segment B (priced between Rs.300,000 and Rs.500,000). They believe that theirdominance in segment A and extensive product range in segment B enables us to offer the customer a wider choice in the small car segment than any of their competitors. In addition, the absence of other manufacturers in segments A gives their dealers greater flexibility in promoting models in segment B. Quality products: In November 2001, they were one of the first automobile manufacturers in the world to receive the ISO 9001:2000 certification. They began to export products in 1988, primarily in order to benchmark our products against international quality standards. They have exported products to approximately 70 countries, including countries in Western Europe. Their products for export are manufactured using the same assembly line as our products for the domestic market. Extensive sales and service network: They believe that they have the largest network of dealers and service centers amongst car manufacturers in India. As of March 31, 2003, we had 178 authorized dealers with 243 sales outlets in 161 cities. They estimate their car parc to be in excess of 3.5 million vehicles. To service this car parc, at March 31, 2003, they had 342 dealer workshops and 1,545 Maruti Authorized Service Stations, or MASSs, which covered 898 cities in India backed by Express Service Centers on 30 highways across the country. In addition to the distribution of their cars, their dealership network is a critical resource in our efforts to provide customers with a one-stop shop for automobiles and automobile related products and services such as automobile finance, automobile insurance, Maruti-certified pre-owned cars available for purchase, and leasing and fleet management, in order to promote customer loyalty. Brand strength: They have been present in the Indian market for almost twenty years and have built their brand on the basis of the values of trust and reliability. Most of their principal competitors have been present in the Indian passenger car market for a significantly shorter period. Certain manufacturers have ceased to manufacture certain products shortly after introducing them, or have left the market altogether. In contrast, they continue to support the maintenance of their products. This has contributed to the strength of their brand. In 2000, 2001 and 2002, J. D. Power Asia Pacific, Inc. ranked us No. 1 in the India Customer Satisfaction Index, which assesses customer satisfaction with product quality and dealer service. They believe that this was the first time that a volume leader in the automobile industry anywhere in the world was ranked first on the JD Power Customer Satisfaction Index. NFO Automotives 2002 Total Customer Satisfaction Survey ranked Maruti products as No. 1 in the Economy, Premium Compact and Entry Midsize segments respectively, for 2002.Integrated manufacturing facility: Their manufacturing facility comprises three integrated plants with flexible assembly lines located at Gurgaon in the northern state of Haryana. Their facility has advanced engineering capability and each plant is upgraded on an ongoing basis to improve productivity and quality. As a result, their first plant set up in fiscal 1984 is technologically at par with their newer plants and is also used in the production of their new models. They believe that they are one of the most efficient among the vehicle manufacturing facilities of Suzukis subsidiaries outside Japan in terms of productivity measured as the ratio of number of vehicles produced to number of employees. They have an installed capacity of 350,000 vehicles per year, which is the highest among passenger car manufacturers in India and among the passenger car manufacturing facilities of Suzukis subsidiaries outside Japan. They have consistently produced in excess of their installed capacity in the five fiscal years ended March 31, 002.They believe that they would be able to expand their production to 500,000 cars per year with minimal additional capital expenditure. This would enable them to benefit from significant economies of scale.Strong vendor base and higher rates of localization: They work closely with their vendor base for the supply of raw materials, components and spare parts of their products. In order to improve quality and generate economies of scale, they have reduced the number of their vendors of components in India from 370 as of March 31, 2000 to 299 as of March 31, 2003, and intend to continue to reduce the number of our vendors. 113 of their vendors at March 31, 2003 were in technical collaboration with foreign entities. As of the same date, we had strategic equity interests through joint venture agreements in 13 of their vendors, who together supply a substantial portion of their purchases of components. A number of their vendors are their dedicated suppliers in that they account for a majority of their turnover. Vendors located within a radius of 100 kilometers from their facility supply the majority of their components. The production systems of their vendors are generally aligned to their need for a reliable and timely supply of components that meet their quality requirements. This has enabled them to increase the proportion of locally sourced, lower cost components in their models, a concept they refer to as localisation. They have been able, in collaboration with their vendors, to increase the rate at which they are able to localise production of their new models over time. This has helped them reduce the cost of their components. Skilled labour and experienced management: Thei highly skilled labour force has become increasingly productive in terms of vehicles produced per employee and receives training on an ongoing basis, including training by Suzuki. As of March 31, 2003, 1,900 of their employees had been trained at Suzukis facilities in Japan. They have been present in the Indian passenger car market for a significantly longer period than most of their principal competitors. As a result, they have been able to build a highly experienced management team that is familiar with conditions in the Indian passenger car market. For instance, their managing director has almost ten years of experience with them, and most of the heads of their divisions have more than 15 years of experience with them. Capital resources: They have cash and bank balances and current investments amounting to Rs.9,992 million. As of the same date, they had relatively low levels of outstanding indebtedness, in the amount of Rs.4,555 million. As a result, they have relatively low interest expense and flexibility to raise funds, if necessary, for their working capital and capital expenditure in the future.

BUSINESS STRATEGYThey intend to continue to focus on the small car segment, while offering products in most segments of the Indian passenger car market. They aim to achieve their principal objectives by pursuing the following business strategies:

Maintain and enhance their product range: They intend to utilize Suzukis expertise in small car technology to produce new variants of their existing models and to upgrade their products with contemporary technology and features.

Increase reach and penetration: They plan to continue to utilize their extensive sales and service network to increase the reach, in terms of geographical spread, and penetration, in terms of sales volumes, of their products across India.

Increased availability of automobile finance: They continue to seek opportunities to expand the size of the Indian passenger car market, especially in the small car segment, through facilitating easy availability of automobile finance. To that end, they have recently entered into an agreement with the State Bank of India.

Secure repeat purchases by offering a 360 degree customer experience: On the basis of their belief that securing repeat purchases from an existing customer requires less expenditure than acquiring a new customer, they aim to provide customers with a one-stop shop for automobiles and automobile-related products and services.

Continue to benchmark their manufacturing capabilities: They plan to continue to benchmark our manufacturing capabilities with the most efficient car manufacturing facilities of Suzuki and its subsidiaries.

Continue to reduce costs to offer more competitive products:Cost competitiveness has been, and continues to be, central to their strategy as the leading manufacturer in the small car segment to expand the size of the market by offering competitively priced, high quality products. The components of this strategy are: Higher levels of localization Vendor participation in cost reduction Cost reduction on warranties Reduction in initial investment cost Reduction in number of vehicle platforms Achieve further cost reduction through higher productivity

Lower cost of ownership:Through their business strategies, they seek to reduce the consumers cost of ownership of their cars, which comprises the cost of purchase, the cost of fuel and maintenance, including spare parts and repairs, during the life of the vehicle, insurance, and resale value.

SALES NETWORKDealers: They offer their products to the customer through a network of 178 authorized dealers with 243 sales outlets across 161 cities. They believe that this is the largest network of dealers amongst car manufacturers in India. Their dealers employed more than 3,500 sales executives. They are linked to their sales network through their secure extranet-based information network. The sales of their spares, accessories and automobile-related services such as insurance and finance serve as additional sources of revenue for our dealers. They believe that the availability of these related products and services at sales outlets also helps to attract customers to the outlets and promotes sales of their cars. Agreements with dealers: They generally appoint a limited number of dealers for a certain geographical territory. Their dealers provide services to customers such as pre-delivery inspection of vehicles, sales of cars, after sales service, supply of spare parts and other services that promote sales of cars within the territory for which they are appointed. They have the right to sell their products and services through other dealers or intermediaries in any territory, whether or not one of their dealers is already established in that territory. Their dealers are required to maintain their outlets in accordance with their specifications and employ well-trained sales staff.Their agreements with their dealers usually have terms of five years. These agreements are generally renewable for successive terms of three years, by mutual agreement. The agreements typically permit termination by either the dealer or them with six months prior notice. Enhancing dealer performance: Their central office in Delhi, their regional offices and their area offices monitor and assist their dealer network. They have nine regional offices, five area offices and 187 sales and marketing personnel. They follow the performance of their dealers and frequently suggest improvements. In order to assist their dealers in enhancing their performance and capabilities, they have introduced a concept of Balanced Scorecard. Using this tool, they seek to measure the performance of a dealership in several areas of operations, including sales, service, spares and accessories, financial management and management systems. They reward dealers who perform well on the Balanced Scorecard with a cash payment at the end of the fiscal year. They believe that the Balanced Scorecard serves as an effective incentive for dealers to enhance their performance.Dealer training: They have established standard operating procedures, showroom ambience and service quality standards for dealerships. They provide periodic training through their training centres located at their manufacturing facility and at Chennai, Kolkata, Guwahati and Pune. They have trained more than 2,600 and 3,400 dealer sales personnel. Their subsidiary, True Value Solutions Ltd., provides value-added services, such as manpower recruitment and training, to their dealers. AFTER-SALES SERVICENetworkAs on date there are 342 Maruti dealer workshops and 1,545 Maruti Authorised Service Stations, or MASSs, covering 898 cities in India. In addition, 24-hour mobile service is offered in 38 cities under the brand Maruti On-road Service. They intend to extend this service to an additional 25 cities over the next three years. As a benchmark for dealers with respect to service quality and infrastructure facilities, they have launched service stations under the brand Maruti Service Masters, or MSMs, in three locations in India. They have service stations on 30 highways in India under the brand Express Service Stations.To promote sales of their spare parts and the availability of high quality, reliable spare parts for their products, they sell spares under the brand name Maruti Genuine Parts, or MGP. These are distributed through their dealer network and through authorised sellers of their spare parts, to whom they refer as stockists.Many of their MASSs are at remote locations where they do not have dealers. In order to increase the penetration, in terms of sales volumes, of their products in these remote areas, they are exploring opportunities to integrate some of the MASSs into the sales process in order to increase sales of their cars and related products and services such as spares and accessories, insurance and financing.Genuine AccessoriesThey have also entered the business of marketing car accessories under the brand name Maruti Genuine Accessories, or MGA, through their dealership network. They seek to provide customers with the opportunity to customize their vehicles with accessories such as music systems, security systems, car-care products and utility products.Warranty and Extended Warranty ProgramThey offer a two-year warranty on all their vehicles at the time of sale. Their dealers are required to address any claim made by a customer, in accordance with practices and procedures prescribed by them, under the provisions of the warranty in force at that time. The dealers subsequently claim the warranty cost from them. They analyse warranty claims from dealers and either claim the cost from vendors, in the case of defective components, or bear the cost ourselves, in the case of manufacturing defects.They offer an extended paid-warranty program marketed under the brand, Forever Yours for the third and fourth year after purchase. They have entered into arrangements with insurance companies to cover the costs of warranties offered under this program. The extended warranty program is intended to maintain the dealers contact with the customer and increase the revenue generated from sale of spares, accessories and automobile-related services. An effort is made during the period of the extended warranty to encourage the customer to exchange his existing Maruti car for a new Maruti car, or upgrade to a new Maruti car.

NEW BUSINESS INITIATIVESAs the largest manufacturer and leader in the small car segment, they continually seek new ways to utilize their vast car parc, range of products and extensive sales and service network to expand the size of the passenger car market in India. They have recently launched new initiatives to develop the market for automobile insurance, automobile finance, leasing and fleet management, and pre-owned cars. They aim to provide customers with a one-stop shop for automobiles and automobile-related products and services, and build on their wide customer base and extensive sales and service network to make available to their customers a wide range of Maruti-branded services at different stages of ownership, which they refer to as the 360 degree customer experience. Atithi Devo Bhava: One-stop shopInspired by the spirit of India. Atithi Devo Bhava, in Sanskirit, means a guest is like God. It captures the Indian tradition of honouring guests. It's also the inspiration for the welcome youll receive at a Maruti Suzuki dealership, and the caring relationship they share with those who drive their cars. At Maruti Suzuki, you will find all your car related needs met under one roof. Whether it is easy finance, insurance, fleet management. services, exchange Maruti Suzuki is set to provide a single window solution for all your car related needs.That's why they have Maruti True Value, the best place to buy and sell reliable used cars. Maruti Finance an agglomeration of the biggest finance companies in India brought together by Maruti Suzuki to ensure that the dream car is within everyone's reach. Similarly, Maruti Insurance brings together some of the biggest names in the car insurance industry to provide insurance solutions to every type of car consumer. Then, finally, there is N2N, which offers fleet related solutions.

THE PLAYERS IN THE INDIAN AUTOMOBILE INDUSTRYHyundai Motor India LtdHyundai Motor India Limited (HMIL) is a wholly owned subsidiary of Hyundai Motor Company, South Korea and is the second largest and the fastest growing car manufacturer in India. HMIL presently markets 31 variants of passenger cars in six segments. The Santro in the B segment, Getz in the B+ segment, the Accent in the C segment, the Elantra in the D segment, the Sonata Embera in the E segment and the Tucson and Terracan in the SUV segment.The company recorded combined sales of 252,851 during calendar year 2005 with a growth of 17.26% over year 2004. HMIL is India's fastest growing car company having rolled-out over 970,000 cars in just over 80 months since its inception and is the largest exporter of passenger cars with exports of over Rs. 1,800 crores. HMIL has recorded a growth of 27.2% in exports over the year 2004. HMILs fully integrated state-of-the-art manufacturing plant near Chennai boasts some of the most advanced production, quality and testing capabilities in the country. In continuation of its investment in providing the Indian customer global technology, HMIL has announced plans for its second plant, which will produce 300,000 units per annum, raising HMILs total production capacity to 600,000 per annum by 2007. The plant will be built on a 2.1 million square meter site adjacent to the existing facility .HMIL is investing to expand capacity in line with its positioning as HMCs global export hub for compact cars. Apart from expansion of production capacity, HMIL plans to expand its dealer network, which will be increased from 157 to 200 this year. And with the companys greater focus on the quality of its after-sales service, HMILs service network will be expanded to over 1,000 in 2006. The year 2005 has been a significant year for Hyundai Motor India. It achieved a significant milestone by rolling out the fastest 200,000th export car. HMIL exports to around 60 countries globally and recently made a foray into the highly competitive UK market by exporting its first shipment of 820 cars.

Propelled by the strong performance in year 2005, Hyundai Motor India is on the threshold of yet another grand milestone of rolling out its One millionth car which is expected soon. Tata Motors

Tata Motors is one of the largest companies in the Tata Group with a total income of US$ 2.35 billion. More than 3 million Tata vehicles ply on Indian roads making Tata a dominant force in the Indian automobile industry. Tata Motors is India's only fully integrated automobile manufacturer with a portfolio that covers trucks, buses, utility vehicles and passenger cars. It would be no exaggeration to say that Tata Motors provides the wheels for India's growth.Tata Motors has the unique distinction of giving India its first and only indigenously built passenger car - The Tata Indica and the premium feature sedan - The Tata Indigo. The Indica, launched in 1998, reached the 2,50,000 sales mark within 52 months of launch.

Tata Motors owes its leading position in the Indian automobile industry to its strong focus on indigenisation. This focus has driven the Company to set up world-class manufacturing units with state-of-the-art technology. Every stage of product evolution-design, development, manufacturing, assembly and quality control, is carried out meticulously. Their manufacturing plants are situated at Jamshedpur in the East, Pune in the West and Lucknow in the North.

Ford India LimitedThe Ford Motor Company has a rich legacy of translating better motoring ideas to the roads. It has manufactured notable brands such as the Ford, Lincoln, Mercury and the Jaguar. It is among the top five industrial corporations in the world and is available in more than 200 countries around the world. Ford has entered the Indian market through a tie - up with Mahindra Motors to manufacture the Ford Escort. A project that has been set up with a investment of Rs.1700 crore. Ford India Limited is a subsidiary of Ford Motor Company, currently Ford has a 78% stake, which is going up to 92% soon. The Maraimalai Nagar Plant of Ford India Limited, located roughly 45k.m.from Chennai, provides employment to over 20000 people.The plant has the capacity to manufacture 1,00,000 vehicles per annum, equipped with state-of-the-art vehicle manufacturing technology from Ford. Presently offering seven different models, Ford India Limited (FIL) is catching up fast with the Indian consumer. This is secured through a quality check program based on the principles of NOVA - C (New Overall Vehicle Audit - Customer) wherein daily random checks are conducted from a customer's point of view. To be doubly sure, routine calls are made to dealerships to check the quality of cars delivered to them.At Mahindra's dealerships are present trained professionals who provide the best levels of service in India. Its intensive manpower training, advanced service equipment and dedicated consumer satisfaction are the are its plus points which is being followed by the entire industry. Acknowledgement has come in the form of the J D power 1997 India Initial Quality and Customer Satisfaction Awards. These internationally acclaimed and recognized awards voted the Ford Escort as the Best Quality car and the Mahindra Ford and its dealerships were rated the highest in Customer Satisfaction. This is an honour as it its only the second time in automotive history that the same brand/manufacturer has received both the awards in the same year.General Motors IndiaGeneral Motors India, incorporated in 1994 as a 50-50 joint venture company with the C.K. Birla Group of Companies, became a fully owned subsidiary of GM in 1999 when GMOC bought the remaining shares. The company was restructured in 1999 and was converted from a Public Limited company to a Private Limited company. GM APH LLC currently holds 86 percent of voting shares, and Holden (Australia) holds 14 percent. The SPO business was integrated with the main business in the same company in 2000. In India, GM strengthened its presence with new product launches Chevrolet Optra in 2003 and Chevrolet Tavera (Multi Utility Vehicle) in 2004. Similarly in 2004, GM India is expected to register a growth of 90% over 2003. With sales volume going up, the market share of GM India has gone to nearly 2%. The sales volume in 2003 was 15,155 units while 2004 figure is expected to be around 27,000 units. In 2004, the company sold a total of 26,166 cars as against 15,155 cars in 2003 registering a growth of 73% while overall passenger car growth during the year was only around 23-24%. These included 9191 Chevy Optras in Entry 'D' Luxury sedan segment, 8369 Opel Corsas and 8417 units of the new generation premium multi-utility vehicle (MUV) Chevrolet Tavera. The existing GM India plant was originally built by Hindustan Motors. In 1994, GM India entered into a 50% Joint Venture partnership with Hindustan Motors and modernized the 45,000-square-meter plant near Halol, 45 kilometers northwest of Vadodara, in the western state of Gujarat. In February, 1999, GM bought the holdings of Hindutan Motors and GM India became a 100% subsidiary of General Motors Corporation of USA. The plant produces the Opel Corsa, Corsa Sail, Chevrolet Optra, and Chevrolet Tavera. The Chevrolet Forester and Opel Vectra are sold as CBUs (Completely Built in Units) and as imported from Japan and Germany respectively. Toyota Motor Corporation is the third largest automaker in the world. They have 34 dealers in India and in Delhi they have 2 dealers, first one is South Delhi Toyota and second one is in Moti Nagar in which I have visited during my survey. Dealer in Moti Nagar which is Galaxy Toyota have predetermined mission that-Customer comes first and everything they do is to meet their customer needs, basically they work for creating a lifetime customer.They work by dividing their work like in one showroom they have separate teams for every product like relating to Corolla it comprises of 7 or 8 executives who handle all the work weather it is of sale or any enquiry or telemarketing call that team must have some specific target to achieve. They reach to the customers either by distributing Leaflets, Brochures to the customers. They collect customer database from Directory (Yellow Pages) or through customer references even they solve customers query online and give information through e-mails. Recently they organized one drawing competition between the kids of their existing customers just to interact with the customer and build loyalty of their company products. They judge their customer satisfaction by analyzing that repeat buyers are more or not & moreover they have customer feedback form in which they can analyze customers background and can forecast customer future demands. They target only high profile customers. They build customer loyalty by giving happy calls to the customer after sale of every 1,3,7 month. They provide Periodic maintenance schedule, which will ensure that vehicle, is kept in best able-bodied at all times. The maintenance schedule may include periodic inspection, adjustment and lubrication that will keep vehicle in the safest and most efficient condition, they provide one booklet in which they give simple and useful tips for maintenance of the car. They offer good schemes like providing free Test Drive worth Rs 250 petrol at the time of sale of any car. They do road shows to attract customers. To promote their product they organize exchange mela, events, various cash discounts like currently they are running one discount scheme on purchase of any of their car (Innova, Toyota) they are giving free accessories worth Rs15000. They provide 4 free services after sale and with full clean diesel.All employees of Galaxy Toyota shall consider how they should act and how they might change their ways to benefit the company. They launch one Co Branded Credit Card to provide additional benefits and services to the Toyota customers. This Credit Card will give Toyota customers a better payment flexibility and convenience, like Customer gets free service voucher with the card, Special Invite to co-sponsored events, Personal accident insurance coverage: Up to 20 lakhs etc. They have one Guest Book in which they store valuable comments of customers, which they think are very important for them, which will help them to improve their service.HONDAHonda is one of the leading manufacturers of automobiles and power products and the largest manufacture of motorcycles in the world. They have 20 dealers in 42 different cities around India. In New Delhi they have 6 dealers, I have visited one of them, which is in Najafgarh Road. They do surveys to know customers need. They target either existing or their perspective customers by giving advertisement in the newspaper or through there satisfied customers which give references. They dont believe on targeting competitors customers because by not doing so they have such a brand reputation with good quality products, only through this they are able to make good sales.They display their models in 8th Auto Expo, which held in New Delhi. They are now focusing on their new model Civic. Honda's Civic perhaps drew the maximum attention. The reason is simple: Civic is a new car from the house of Honda. During my survey I get to know that Honda City Model is the second largest selling car in the C segment. They have a good superiority with superior brand name in the country.They prefer to have mode of communication with the customer through mail, telephone and sometimes by letter. Customers who dont have time even to see the model or to call the dealer to make inquiries about their reservation they desire to solve their query online itself.To judge customer satisfaction they some times invite their customers to have a get together, to have interaction with customer in a minute to know that are they satisfied with their services and what they are expecting from them in the near future. They make maximum of their sales from the fresh customers rather than their repeat purchasers. To increase their sales they try to extort surreptitious information from the customers and on their end they aim to ensure that the product quality and product quantity should be available in required quantity in their dealership.They have Feedback form in which they take feedback of the customer as well as their salesperson because through this they are able to get the information of both the customer & their salesperson that are they giving the full information to the customer. This Dealership even provide technical skills and techniques to their employees that how to deal with the customer thoughtfully every after 6 months.

NEED FOR CRM IN AUTOMOBILE INDUSTRYThe global automotive industry exhibits most of the characteristics of mature industries and closely follows their business cycles. While vehicle industry sales have been strong for the past several years, they have started to slow recently due to the current global economic slowdown. Deteriorating economic conditions result in a drop in consumer confidence, which quickly impacts automotive sales due to their big-ticket status and the relative low cost of extending the life of an existing vehicle through maintenance and repair. The advent of the Internet as a research tool (75 to 80 percent of auto consumers research using the Internet) has shifted power to consumers, further increasing pressure on prices. At the same time, government regulation and consumer demands for sophisticated features have increased development, production, and marketing costs. Regional economic fluctuations favor consolidation among car companies, suppliers, and retailers -resulting in fewer, larger companies that have more complete product lines targeted at existing and new markets. Consolidation has heightened competition in all vehicle segments. Low-cost manufacturers are expanding beyond their home markets with entry level vehicles, traditional passenger car manufacturers are expanding into the light truck markets, and luxury manufacturers are moving down market with passenger cars and SUVs. As a result of these product and market extensions, consumers find it difficult to exhibit brand loyalty because vehicles have unclear brand identities, similar features, and comparable prices. In addition, an overpopulation of dealers has resulted in local and regional competition among same make dealers. This further reduces margins and damages the brand images the car companies spend large amounts of money to build. Relations between the car companies and their suppliers traditionally have been difficult. In response to competitive pressure, suppliers have been forced by the car companies to provide higher-quality components at constantly lower costs. The resulting decrease in margins and the reduction in volume due to slowing sales have increased the pressure to consolidate and forced some suppliers to the brink of bankruptcy. Dealers too have a long history of adversarial relationships with the car companies. Independent entrepreneurs who view some of the car companies with skepticism or serious mistrust, dealers believe that many manufacturer-sponsored customer satisfaction programs are actually designed to force smaller dealers out of business or to gain control of customer relationships that the retailers believe they "own." These difficult relationships have prevented car companies and dealers from maximizing the lifetime value of their combined customers. There are few incentives or efficient methods for dealers and car companies to share critical data, resulting in ineffective management of product, service, and household information. In addition, consumers receive conflicting marketing communications from the two groups, which results in reduced brand value. Key Industry Pain Points Decreasing sales and market share - The long-term battle for market share continues to intensify. In the mature automotive industry, where business cycles drive sales fluctuations, market share is critical to survival. Consumers are less brand-loyal than in the past, and every market segment has an increasing number of vehicle choices. To increase sales and gain ground in the market share battle, companies must improve their ability both to acquire first-time customers and to develop customer loyalty to their current brands. To achieve these related objectives, companies must set an aggressive goal -deliver the best customer experience in the automotive industry.

Difficult dealer relationships and a lack of dealer collaboration - As the consumer 's primary touch point ,the dealer network is a critical component of customer-facing operations. Therefore, the integration of the dealer network is absolutely essential to improving the quality of the customer experience. Only with an infrastructure that enables the effective flow of information to and from dealers can companies create a complete view of their customers. Car companies must take the initiative in understanding the customer 's perspective throughout the buying cycle.

Lack of multichannel capabilities - With the advent of the Internet as a research tool, the majority of customers are accessing the automotive enterprises through several different channels. Many times, the switch between channels happens very rapidly as a prospect or customer can view a Web site, make a phone inquiry, and visit a retail store within days or even hours of an initial contact. To improve customer satisfaction and secure customer lifetime value, companies must be able to capture these multiple interactions, provide seamless management between channels, and leverage shared customer information to create rewarding experiences and to develop and execute highly targeted marketing campaigns.

Inefficient demand chain planning and high associated IT cost - Cost reduction is an ongoing competitive requirement. Just as supply chain management must be supported by a sophisticated information infrastructure, effective demand chain management also requires the right supporting infrastructure, enabling car companies to fully leverage each customer relationship through exceptional customer service, efficient lead generation and management, and effective promotions and campaigns. In addition, global automotive enterprises operate a wide variety of IT systems in their various business units and functional groups. Rationalizing these systems offers significant cost savings.

Lack of effective information sharing - Car companies must integrate global operations in order to achieve the benefits of consolidation -cost reduction, effective communication, and true integration of core competencies. In addition, internal alignment between business units and functional groups is required to create a unified view of consumers, products, and services. Currently, each business unit, functional group, and brand operates through independent systems, programs, and touch points. As a result, there is limited synergy across the ecosystem, leading to significant inefficiencies, lack of coordination, and most important, an inability to maximize "share of wallet "from every customer through well-targeted marketing and cross-selling. Synergy between traditionally independent business units such as captive finance companies and between functional groups such as sales, service, and marketing is more critical now than ever before. Only by sharing customer information can customer lifetime value be maximized among different groups.

Complex data governance requirements - Global automotive enterprises have large, complex information technology ecosystems. While customer information must be shared within this ecosystem in order to fully maximize global operations, it must also be protected. Proper management of customer information requires a sophisticated capability to manage a variety of access rules and to accommodate legal restrictions that can change very quickly. The trust required for successful collaboration between groups in the automotive enterprise must be built by demonstrating that customer information can be shared while observing these complex requirements.

Difficulty managing employee relationships - In today 's fast-paced business environment, automotive companies need to ensure that their most valuable asset -their employees -have immediate access to the critical information, services, and applications required to be productive. Organizations must enable employees to make better decisions, work collaboratively, enhance customer relationships, and maximize productive time. Global automotive enterprises must be able to enact and enforce consistent policies across business units, instill a common corporate culture across a geographically dispersed and diverse workforce, equip employees with effective search tools to access corporate knowledge bases, and provide employees with the training necessary to service customers in a volatile and demanding market.

FINDINGS FROM SURVEYTotal Number of Respondents: 10 Officials Which company does the customer prefers??Companies PreferredNumber of Respondents

Maruti Suzuki6

Hyundai Motors India Ltd2

Tata

Honda1

Skoda

General Motors1

Do you face problems in maintaining good and effective relationships with customers?

CompaniesYesNo

Maruti Suzuki4

Hyundai Motors India Ltd2

Tata1

Honda2

Skoda

General Motors1

Findings: According to the responses of the respondents it can be concluded that all the respondents face problems in maintaining good and effective relationships with customers. With changing customer needs its quite obvious that maintaining good relations with customers need an effort on part of the Dealers and Manufacturers. How well can your company identify its end user customers?

Maruti Udyog Limited: According to the officials of MUL, the companys endeavor is to be close to the customer, to anticipate and fulfill their needs. They believe that the new business initiatives taken by MUL have expanded the scope of this relationship. Maruti offers auto insurance, auto finance, corporate lease and fleet management and resale of pre-owned cars in partnership with its dealers. For the first time, car customers in India are able to access these services through a one-stop shop, backed by the leader brand. The way they look at it is that this will provide complete mobility solutions to the Maruti customer. This also enables them to extend their relationship with the customer beyond the point of purchase to the entire ownership life cycle. Since these services play a vital role in the car customer's ownership experience, the new initiatives enable them to offer Maruti owners greater value, assurance and convenience. Hyundai Motors India Ltd: According to the officials of Hyundai Motor India is at a very exciting stage in India today. They are experiencing tremendous growth - which is a true sign of enjoying customer confidence. In order to strengthen their position further in the Indian market, they need to continuously work on building their corporate reputation while aggressively positioning their products. For HMI's focus and commitment to the Indian automobile customers is of critical importance. Its been their continuous endeavor to fulfill the entire spectrum of customer needs and desires, across all socio-economic & lifestyle groups. They have therefore, in just 6 years of HMI's young life, established nationwide sales & service network, scaled up state-of-the-art manufacturing capacity, launched global-standard cars in rapid succession and exported cars made-in-India across the globe. Getz, a much admired lifestyle brand in Europe and elsewhere, is a step in the same direction and is a cutting-edge, addition to HMI's extensive product portfolio. General Motors: According to the officials at General Motors is positioned as a mature and responsible car manufacturer, which offers great value-for-money products to its customers. The company leverages its global expertise to manufacture and market well engineered and safe products through its well-established retail network that provide an excellent ownership experience to its customers. Tata Motors: According to the officials of Tata Motors the foundation of the companys growth over the last 50 years is a deep understanding of economic stimuli and customer needs, and the ability to translate them into customer-desired offerings through leading edge R&D. Ford India Limited: According to the officials of Ford India has reaffirmed its commitment to enhancing the purchase and ownership experience for its customers with the rollout of Ford Brand@Retail concept across the country. Ford India has been revamping all dealerships under the Ford Brand@ Retail, a global corporate identity program to offer a world-class purchase experience to the customer. Ford India continues to expand its distribution network and will grow to 115 dealer outlets in 79 locations by the end of 2005. The officials also mentioned that Ford India provides training support to dealers in areas including customer satisfaction, sales, technical and non-technical aspects of the business and in the financial management of the dealership.

Can your company differentiate its customers based on their value to you and their needs from you?

CompaniesYesNo

Maruti Suzuki4

Hyundai Motors India Ltd11

Tata1

Honda2

Skoda

General Motors1

Findings: According to the respondents (officials) at all the Five Automobile Majors their company was able to differentiate its customers based on their value to them and their needs from the company. This is important for the automobile industry because the dynamics of selling cars is changing and manufacturers and dealers who fail to meet the rising needs and expectations of their customers will lose out to those who can. Buying a new car is an experience customer will remember for a long time and ensuring that this experience is a satisfactory one is essential in building brand loyalty and customer advocacy.

How well do you interact with your customers? Maruti Udyog Limited: According to the officials of MUL, their overall strength lies in building an organization that is sharply focused on the voice of the customer. Maruti's consistent performance over the past several years has resulted in a steady increase in the percentage of its customers who say they intend to remain loyal to the brand. n order to be closer to the customers, it is essential that we should have multiple avenues of one-to-one interaction with our customers. As a major step in this direction they have started Call Center service with toll-free number for the people of National Capital Region in year 2000. This service, named Anytime Maruti, is now available nation-wide. Customers in over 700 cities/towns across India can contact them any time during the day and all days of the week. The toll-free service is 1800 1800 180, it is accessible from any fixed-line or mobile phone of BSNL/MTNL network across the nation. The Anytime Maruti Call-center can also be accessed using telephones on other networks by dialing 09811801515 (not toll-free). The objective of this service is to ensure that customers have quick and easy access to all information on their models, prices, dealers, value added services, finance options, and the locations of our numerous service stations. Anytime Maruti helps customers to learn more about their Maruti Cars and also about other services offered by Maruti. For prospective buyers, Anytime Maruti can help them deciding amongst various Maruti Models and benefits of buying from Maruti. Hyundai Motors India Ltd: According to the officials at HMI The Company has set up more than 70 dealer workshops that are equipped with the latest technology, machinery, and international quality press, body and paint shops, across the country, thereby providing a one-stop shop for a Hyundai customer. Hyundai also has a fleet of 78 emergency road service cars - specially equipped Santro that can provide emergency service to all its customers anytime, anywhere. The customers can also call on 1800-11-4645 (Toll Free - Only from MTNL & BSNL numbers)011- 26924645 (For all GSM Connections / Landline other than MTNL & BSNL numbers) for any queries & customer complaints.

General Motors: According to the official at GM, to bring greater value and service to customers, they have introduced the GM Service Plus a unique cluster of services, designed to compliment every aspect of owning a car and ensuring complete peace of mind. So be it emergency assistance, an urgent car servicing or even sourcing genuine accessories, Customers can be assured of yet another great moment from General Motors. For any car related query or emergency requirement, customers can call 24-hour assistance at 30308080. The unique 3-hour service programme comes with a promise of servicing your car in just 3 hours, or you get the service free. With their 24-hour workshops, customers can now conveniently get their car serviced, when they use it the least. Widespread sales and service outlets across the country ensure that you have the assurance of great service wherever you travel in India. Tata Motors: according to the officials of Tata Motors the company has strengthened its distribution and customer care network and today has 77 dealers and 230 authorized service outlets spread across 119 locations in India. Ford India Limited: According to the officials at Ford solutions aims to provide quality, peace-of-mind products for the customer and embodies a brand synonymous with its ability to provide products that can be tailored to suit one's individual needs. Ford Solutions serve to develop products for Ford and the Dealer body that enhance customer satisfaction. When your vehicle needs a repair or a component replaced, you need Quality Care service. Your Ford Dealership is simply the best place to have your vehicle serviced. Brakes, shocks, batteries or anything your vehicle may need, your dealership is the place to get it. Customers can place a online service request at Ford.

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