Abstract

My stepping stones…...

I had an impression in my mind that the project which I am going to undertake would

only be a mere prerequisite to enter into a corporate world. But when it came to end,

only then, I understood that, what it is like to be professional man. How important this

project is for all students who are doing their post graduate degree in Business

Administration.

I learned a lot from this experience, many aspects were totally new to me

and it took great deal of efforts to understand them but now when I am finished with this

project, I can say that the time which I spent on this project gave me knowledge and

professional attitude for whole life.

The following report discusses the details of these experiences and about the

project.

I thank everyone who has contributed to make this experience complete and fomented.
Acknowledgement

Concentration, dedication, hard work and application are essential but not the only
factor to achieve the desired goal. Those must be supplemented by the guidance
assistance and cooperation of experts to make it success.

I am extremely grateful to my institute for providing me the opportunity to undertake this

research project in the prestigious field.

With profound pleasure, I extend my extreme sincere sense of gratitude and

indebtedness to my faculty for extensive and valuable guidance that was always
available to me ungrudgingly and instantly, which help me complete my project without
difficulty.

I express my deep and sincere gratitude to Prof. Reshma Srivastava (Faculty member
-MBA Dept.) for providing me first hand knowledge about other related subjects.
 Index
CHAPTERS PARTICULARS PAGE NO.
Abstract 1

Acknowledgement 2

Index 3

Chapter 01 Introduction to the topic 5

1.1 Research Objective 6

1.2 Purpose of study 6

1.3 Scope of study 8

Chapter 02 Introduction to company 9

2.1 Profile of the organization [HERO HONDA] 10

2.2 Profile of the organization [TVS] 16

Chapter 03 Literature review 19

3.1 Auto industry - A review 21

3.2 Classification of the industry 23
Chapter 04 Research Methodology 27
4.1 Problem Statement 28
4.2 Research type 28
4.3 Sampling technique 29
4.4 Data collection 30
4.5 Procedure 32
Chapter 05 Data analysis and Interpretation 33
5.1 Data analysis (questionnaire) 34
5.2 Data interpretation 40
5.3 SWOT analysis 46
5.4 Objective wise analysis 50
5.5 Observations 71
5.6 Findings 72
Chapter 06 Recommendation and Suggestions 73
Chapter 07 Limitation and conclusion 75
Chapter 08 References 79
Chapter 09 Bibliography and Webliography 83
Chapter 10 Annexure 85
10.1 Questionnaire 86
10.2 List of table 89
10.3 List of figure 89
 Chapter 1

Introduction to
topic
1.1 Research Objective

➢ To study the marketing mix of Hero Honda & TVS Motors.

➢ To study various promotional strategies and know about the current strategies
keeping in mind the cutthroat competition between Hero Honda & TVS Motors.

➢ To focus on comparative marketing strategies of Hero Honda & TVS Motors.

➢ Different range of Products; their success and failure.

1.2 Purpose of Study

This report deals with Motor Bike Industry in India, who are the major players in this
industry and what is their image in eyes of customers. How consumers recognize and
rate Hero Honda in comparison to TVS Motors in the market is the main motto of study.

The project named “BRAND IMAGE BUILDING APPROACH IN TWO WHEELERS.

(An Analysis of TVS Motors & Hero Honda)” is undertaken to analyze how customer
views Hero Honda as a Brand in comparison to TVS Motors.

HERO HONDA Motors Ltd. (HHML) came into existence by collaboration of HERO
Cycles Pvt. Ltd. & HONDA Motor Company. Advanced technology coupled with
environmental friendly approach of treating effluents is the one of the outstanding
feature of this organization. HERO Group has been a pioneer & now an unmistakable
leader in an array of consumer & industrial appliances including motorcycles, light
motorcycles, mopeds, automotive components and industrial supplies.

This report tries to find out Brand Image of Hero Honda & TVS Motors in customer’s
eyes in comparison to other competing brands available in the market.

This report puts a light on consumer perception relating to brands available in Motor
Bike Industry & whether Hero Honda & TVS, as a brand are able to retain their position
in the Market beside cut throat competition or not.

This project is not concentrated to a particular area or factor. This project basically
includes all the factors which emphasize purchasing decision of a customer and his
choice.

The project is based on a Market Survey being conducted of the general customers &
thereby analyzing and recording their views about Hero Honda and TVS Motor.
1.3 Scope of Study

➢ The project involves, the study of the segmentation, targeting & positioning of
Hero Honda two-wheeler in the market. And what people think about it in
Comparison with TVS Motors.

➢ It includes carrying out a survey among customers & the industry people as well
as the retailers of these two Companies. It also involves the devising of
repositioning of the existing brand by some modifications; advertisement should
be so made that the targeted segment comes to know what the bike is. How is it
better from TVS? So, that in near future this bike becomes a grand success.

➢ Information regarding the market share, cost factors, the marketing and
promotional strategies etc was collected from primary and secondary data
sources.
 Chapter 2

Introduction to
company
(2.1) Profile of the organization

Hero Honda Motors Limited (HHML) started as a Joint Venture between Hero Group,
the world's largest bicycle manufacturers and the Honda Motors of Japan. Today HHML
is the manufacturer of India's largest selling motorcycles. Coming into existence on
January 19, 1984, the company gave India nothing less than a revolution on two-wheels
made even more famous by the 'Fill it - Shut it - Forget it' campaign. With a market
share of 42% in the motorcycles segment and 20.16% in the two wheeler industry as a
whole, HHML is building on the trust of 1 million customers. The philosophy of HHML
has been to produce vehicles based on consumer preferences. They ensured superior
quality in style, and excellent performance in terms of fuel efficiency. This helped the
company to become the market leader in the motorcycles segment. Fuel efficient bikes
managed to overcome the price advantage that scooters had over motorcycles and this
has initiated the shift of consumers from scooters to Motorcycles.

Sales Performance

It is my privilege to share with you the fact that by the end of the calendar year 2001,
Hero Honda became the largest single two-wheeler manufacturer in the country and
also in the world. The leading edge got consolidated by the close of financial year 2001-
02 with a record sale of 1.43 million units. This is equivalent to 35.2% growth on the
previous year sale of 1.03 million units. In the same manner, the market share of the
company increased to 48% and 33 % in motorcycles and two-wheelers, respectively.

Hero Honda Motor Ltd., the country's largest two-wheeler maker, finished the year
2002-03 with total motorcycle sales of 1,677,535 units; a growth of 18% over last year's
sale of 1,425,302 motorcycles.
For the month of March 2003, the company posted sales of 115,722 motorcycles
compared to 135,464 in March 2002. As reported earlier, the economic slowdown, as a
consequent of drought in certain parts of the country, and low agricultural production,
affected the demand for a whole lot of durable including motorcycles. Lack of clarity on
VAT issues also impacted sales.

The company achieved a significant landmark in exceeding its sales turnover target of
Rs. 5000 crore during the year; up from Rs. 4539.49 crore in the previous year.

Last year, two new models were launched, namely Passion and Joy to address super-
style and economy segments. Passion has found its position firm amongst Indian
models, only next to Splendor, the largest selling bike in the world in terms of sales
performance. Joy was re-launched as Dawn, in April 2002, with changes and value
additions to cater to specific needs of the customers. Reportedly Dawn is doing well in
its segments and has sold over 10,000 units in the initial months itself.

Hero Honda has targeted a sale of over 1.8 million bikes for the year 2002-03. This
effort is supplemented by two major launches this year, one in September and the other
coinciding with World Cup Series in early 2003, which is being sponsored by Hero
Honda Motors Ltd. These bikes will have some novel features and will be in the 100cc
plus range. There is an ambitious programme of launching a new range of bikes with
technical support from Honda in the coming years.

With a slew of such measures the capacity available at present locations can at best
support two-million production targets at the existing plants. The company, therefore, is
looking at the possibility of setting up a third plant to meet the future demand and for
which techno-economic study is in progress.
New Initiatives

Customer and customer satisfaction is the purpose of our being an entity. To

increasingly understand him and make him part of our ongoing business we have
launched a unique

CRM Program called “Hero Honda Passport Program”

The passport holders not only get concessions on parts and spares but also enjoy the
benefit of company organized cultural and sport events. So far six lakh Hero Honda
owners have been made members and we would like to soon get to a million figure.
Some more initiatives on the aegis of Passport Program are planned for the year 2002-
03.

Another customer related initiative has been the

Increase of warranty period to two years since July 2001.

This has attracted a great deal of customer attention.

During the year the company has added nearly a hundred dealerships and SSPs. In
terms of sheer numbers, the network has grown by 16% during the year 2001-02. We
would endeavor to increase our reach to every corner of this country.

On the operation side after the successful launch of ERP (SAP) last year, the company
has now taken up its extensions to cover Human Resource division this year. Also,
under consideration of extending the network to dealers, vendors and other associates.
The idea is to increase the network capability to bring about efficiency in operations and
also in our response to changes in the market.

Plans for the future

Hero Honda’s performance has been more than satisfactory; it has earned substantial
operating margins from a primarily engineering-based manufacturing business. All its
stakeholders–promoters, suppliers, dealers and investors–are involved in its growth. It
is sure it will maintain margins and grow at 12-15 per cent over the next two-three
years, in line with the industry. The company aims to garner 35 per cent of the
motorcycle market in the current financial year and has set a growth of 26 per cent for
the year.

Hero Honda has maintained its overall market share of 43-45 per cent in the motorcycle
segment. While in the executive segment the company has lost its market share, it has
gained a significant market share in the entry-level segment.

Motorcycle and step-through sales fell 3.3 per cent in March 2003 but posted a modest
six per cent growth in April 2003. With the launch of the of the 100cc motorcycle CD
Dawn and the 223cc Karizma the product portfolio of the company now caters to a wide
cross section of riders.

Hero Honda Motors Ltd. (HHML) has attained the distinction of being the largest two-
wheeler company in the world in volume terms. With a new factory on the anvil, it is
gearing itself for Operation One Billion, targeting $1 billion revenues in 2002-03. "Next
year, we will enter the (dollar) billionaire's club (in revenues). After Operation Million for
volumes in 2001-02, our slogan for the next year is Operation One Billion, said Mr.
Pawan Munjal, Director and CEO, HHML.
Sales performance
Hero Honda reports leadership performance with 50% net profit in q2, '08-09
Defies industry trend with turnover (net sales & other operating income), at rs. 3202
crore; ebidta at 13.58 per cent

Aug'06 Aug'07 FY 06-07 FY 07-08

Total Sales 2,15,076 2,40,875 12,82,860 12,63,254

Sales
Market share

(2.2)Profile of the organization

TVS Motor Co. is the flagship company of the TVS Group. The TVS group was
established in 1911 by Sri T.V. Sundaram Iyenger. TVS group commands a strong
presence in manufacturing of two-wheelers, auto components and computer
peripherals. TVS Motor Company's first launch was 50 cc Moped TVS 50 in August
1980. It is the first Indian company to introduce 100 cc Indo-Japanese motorcycles in
India in 1984. It was also the first Indian company to launch indigenous scooterette in
India in 1994. It has grown rapidly since it's beginning to become one of the prominent
two-wheeler manufacturers in India. Today TVS is a well-known brand in the field of
bike manufacturing. The manufacturing unit of TVS Motor is located at Hosur and
Mysore.

Milestones
2006:-

Houser, May 2, 2006: TVS Motor Company has begun the new fiscal on a spirited note
recording 53 per cent sales growth in motorcycles in April 2006. As against sale of
52,825 units in April 2005, the company clocked sales of 80,862 units in April 2006.

Buoyed by the motorcycle growth, the overall two wheelers recorded 1,24,917 units in
April 2006 compared to 92,400 units in the year ago period, recording a growth of 35%

Recently, the company launched feature-packed new versions of TVS Star City and
Victor GLX with alloy wheels. The company launched a new advertising campaign for
the Star City brand featuring its latest brand ambassador Mahindra Singh Dhoni.

TVS Apache that has won wide acclaim as the best bike of the year has met with
an encouraging response in all the markets that it has been launched in the last two
months. The company is in the process of ramping up production and spread its
availability in more towns in the coming months.

According to a recent study by Boston Consulting Group and the CII, TVS is among the
list of 100 companies chosen from 12 rapidly developing economies that are emerging
as global challengers. The company is a recipient of The Deming Prize for Total Quality
Management, the hallmark of Quality.

2005:-
TVS APACHE, the all new 150 cc bike makes a debut
The Apache is the new 150 CC, 5 speed stunner of a motorcycle created to be the
leader of the 150 CC motorcycle class with respect to acceleration, performance,
styling, ride handling, and stability. With its sporty and chiseled looks and unmatched
performance packed with superior engine technology, the Apache is sure to be a head
turner.

Apache’s engine is powered by 13.5 Brake Horse Power (bhp) and, with the highest
power to weight ratio in its class, the bike is slated to be the fastest off the block in the
150 CC categories.

The Apache has been designed and engineered to woo youngsters on the look out for a
motorcycle that is aggressive and sporty looking with class leading performance. This
racing inspired sleek machine characterizes unique engine features, innovative design,
international looks, advanced engineering and technical excellence offering an
exhilarating combination of sporty performance and exceptional ride comfort in
highways and city roads.

With the Apache, TVS is now set to redefine the 150 CC segment. With this launch TVS
aims at strengthening its position in the premium segment of the motorcycle and
consolidate further on total volumes.
Chapter 3
Literature
Review
Some people distinguish the psychological aspect of a brand from the experiential
aspect. The experiential aspect consists of the sum of all points of contact with the
brand and is known as the brand experience. The psychological aspect, sometimes
referred to as the brand image, is a symbolic construct created within the minds of
people and consists of all the information and expectations associated with a product or
service.

People engaged in branding seek to develop or align the expectations behind the brand
experience, creating the impression that a brand associated with a product or service
has certain qualities or characteristics that make it special or unique. A brand is
therefore one of the most valuable elements in an advertising theme, as it demonstrates
what the brand owner is able to offer in the marketplace. The art of creating and
maintaining a brand is called brand management.

Careful brand management, supported by a cleverly crafted advertising campaign, can

be highly successful in convincing consumers to pay remarkably high prices for
products which are inherently extremely cheap to make. This concept, known as
creating value, essentially consists of manipulating the projected image of the product
so that that the consumer sees the product as being worth the amount that the
advertiser wants him/her to see, rather than a more logical valuation that comprises an
aggregate of the cost of raw materials, plus the cost of manufacture, plus the cost of
distribution. Modern value-creation branding-and-advertising campaigns are highly
successful at inducing consumers to pay,
(3.1)Auto industry- A review

Introduction

The Rs. 5500 crore Indian Two wheeler segments is the second largest market fin the
world after China. India’s two wheeler production is the third largest in the world after
Japan and China. India has a well- developed two wheeler market with around 15
million households owning two-wheeler.

The Indian two wheeler industry made a modest beginning in the early 1950 when
Automobile Product of India (API) started manufacturing scooter in India. Until 1958.
API and Enfield /( motorcycle) were the only two production. In 1948, Bajaj auto began
trading in imported Vespa scooter and the three – wheeler- finally, in 1960’s. it set up
shop to manufacturer them in technical collaboration with piggaio of Italy. The
agreement expired in 1971. In the initial stages, the scooters segment was regulated
regime, foreign company was not allowed to operate in India, and waiting time for
getting Bajaj scooters was as high as 12 years. Java and escort. While the Enfield bullet
was a four strokes bike, the Java and Rajdoot were two-stroke bikes. The motorcycles
industry was originally dominated by Enfield with 350 cc bikes. The motorcycles industry
was cc segment. The two wheelers segment was opened up to foreign competition in
the mid 1980’s which saw the entry of the Japanese manufactures into the country.
Market share of 125-250 cc motorcycles (2007-08)
(3.2)Classification of the industry

The two-wheeler segment can be categorized into the scooter, mopeds, and
motorcycles.

Motorcycles: this segment has shown the best performance in the recent years. The
market leaders in this section are Bajaj Auto. TVs Suzuki, Hero Honda and Escort. The
splendor is the most popular segment among motorcycles.

Two Wheeler Industry

The Indian two wheeler contributes the largest volumes amongst all the segments in
automobile industry. Though the segment can be broadly categorized into 3 sub-
segments viz.; scooters, motorcycles and mopeds; some categories introduced in the
market are a combination of two or more segments e.g. scooterette and step-thru's . In
the last four to five years, the two-wheeler market has witnessed a marked shift towards
motorcycles at the expense of scooters. In the rural areas, consumers have come to
prefer sturdier bikes to withstand the bad road conditions. In the process the share of
motorcycle segment has grown from 48% to 58%, the share of scooters declined
drastically from 33% to 25%, while that of mopeds declined by 2% from 19% to 17%
during the year 2000-01. The Euro emission norms effective from April 2000 led to the
existing players in the two- stroke segment to install catalytic converters. All the new
models are now being replaced by 4-stroke motorcycles. Excise duty on motorcycles
has been reduced from 32% to 24%, resulting in price reduction, which has aided in
propelling the demand for motorcycles.

Within the two-wheeler industry, motorcycle segment grew at a phenomenally high rate
of 35% as against a deceleration of 3% for scooters and 27% for mopeds. In fact,
motorcycle has been taking away the share of scooters and mopeds in a 4.3 million
two-wheeler market and surging ahead with its market share of 68%. The increasing
demand from semi-urban and rural segments may have caused this positive shift
towards motorcycles. Also, easy credit coupled with low interest rate regime,
constrained personal transport, increasing income levels in middle class and higher
aspirations of young people all seem to be the factors responsible for such high growth
in two-wheelers. The growth in two-wheelers has been robust enough to counter the
slow down and other factors constraining the overall business activity in the country.
Also, rationalization of excise duty in the Union Budget 2002-03 had a positive impact
on the demand for motorcycles. We also expect the motorcycles to continue to lead the
two-wheeler segment like in all other Asian countries. Available forecasts suggest that
this trend would continue for another couple of years and the industry would record
nearly double-digit average annual growth up to 2006.

During the year, there have been important developments in two-wheeler industry. The
competition has strengthened though there are hardly any new entrants into the
industry. There is an increasing emphasis on price and this has led to cost cutting
efforts all across the industry, thereby, making the customer an ultimate beneficiary.
The trend also saw introduction of new motorcycles with capacity ranging from 100 to

180cc bikes. We anticipate that many more new models will be launched during the
year and provide customers plenty of choice at competitive prices.

Businesses cannot consistently grow at 25-30 per cent. Each business has a tendency
to taper and plateau after attaining a particular size. An annual growth rate of 10-12 per
cent over a period of time is extremely healthy.

The TCS study rankings are conducted at the motorcycle segment-level to provide
comparisons among similar groups of motorcycles. Motorcycles ranking highest in their
respective segments for TCS are: Hero Honda CD100 SS (best standard motorcycle
segment); Hero Honda Splendor (best executive motorcycle segment); Bajaj Pulsar
(best premium motorcycle segment); and Royal Enfield Bullet Electra (best cruiser
motorcycle segment). "The relatively low score for the premium segment indicates that
most manufacturers have fallen short of meeting the high expectations of these buyers,"
states Mr. Lochan. "Bajaj Pulsar is one exception with segment-leading ratings across
all aspects of ownership experience, particularly on areas related to vehicle styling."
Production, sales growth of the industry

The two-wheeler companies have been operating at high capacities due to high growth
rates between 1993 and 1996. The growth is expected to lead to increase in the
capacities from present 32 lakhs units to 50 lakhs per annum in the year 2002-03,
whereas the actual production estimates by that period at an estimated growth rate of
18% is only 50 lakhs.

Industry development

India is the second largest manufacturer and producer of two wheelers in the
world. It stands next only to Japan and China in terms of the number of two-
wheelers produced and domestic sales respectively. This distinction was
achieved due to variety of reasons like restrictive policy followed by the
Government of India towards the passenger car industry, rising demand for
personal transport, inefficiency in the public transportation system etc.

The Indian two-wheeler industry made a small beginning in the early 50s when
Automobile Products of India (API) started manufacturing scooters in the
country. Until 1958, API and Enfield were the sole producers.

In the initial stages, the scooter segment was dominated by API, it was later
overtaken by Hero Honda. Although various government and private enterprises
entered the fray for scooters, the only new player that has lasted till today is
LML.

Under the regulated regime, foreign companies were not allowed to operate in
India. It was a complete seller market with the waiting period for getting a
scooter from Hero Honda being as high as 12 years.

The two wheeler market was opened to foreign competition in the mid-80s. And
the then market leaders- Escorts and Enfield were caught unaware by the
onslaught of the 100cc bikes of the four Indo-Japanese joint ventures. With the
availability of fuel efficient low power bikes, demand swelled, resulting in Hero
Honda then the only producer of four stroke bikes (100cc category), gaining a
top slot.

The Industry had a smooth ride in the 50s, 60s and 70s when the Government
prohibited new entries and strictly controlled capacity expansion. The industry
saw a sudden growth in the 80s. The industry witnessed a steady growth of
14% leading to a peak volume of 1.9mn vehicles in 1990.

The entry of Kinetic Honda in mid-eighties with a variometric scooter helped in

providing ease of use to the scooter owners. This helped in inducing youngsters
and working women, towards buying scooters, who were earlier, inclined
towards moped purchases. In the 90s, this trend was reversed with the
introduction of scooters. In line with this, the scooter segment has consistently
lost its part of the market share in the two-wheeler market.

The reasons for recession in the sector were the incessant rise in fuel
prices, high input costs and reduced purchasing power due to significant
rise in general price level and credit crunch in consumer financing.
Factors like increased production in 1992, due to new entrants coupled
with the recession in the industry resulted in companies either reporting
looses or a fall in profits.
 Chapter 4

Research
Methodology
(4.1) Problem Statement
Brand image building approach in two wheelers in Raipur city
Analysis of TVS Motors & Hero Honda

(4.2) Research Type

Descriptive Research, Non Probability Distribution

Universe and survey population:-

The universe for the project was the population of Raipur city.

The survey population was youngsters and bike owners.

The project involves the study of four- strokes bike segment in two wheeler industry
sector, which involved:

1. Market survey/ Researches

2. Meeting the retailers and the customers

3. Desk Research
For this research I did two types of surveys (Data source):

A. PRIMARY SURVEY

• Conducted by taking views of the customers using this model of Hero Honda and
TVS. Their view points about the model, their grievances/ complaints about it. Last
but not the least their views about modification required in it.

B. SECONDARY SURVEY

• Conducted gaining information from different magazines, newspaper, personal

interviews, web sites, company annual reports, telephone discussion, and personal
discussion. It is one of the best methods to collect data because of economy in
terms of time and money.

(4.3) Sampling Technique

The research instrument used was a structural questionnaire.

SAMPLING PLAN

a) Sampling unit: The sampling unit constituted the people in the middle income going
in for bikes.

b) Sampling size: the sample size consists of 45 customers, out of which 5 refused to
fill the questionnaire and 5 forms were found incomplete.

c) Sampling procedure: Convenience sampling.

(4.4) Data collection

Data collection is the gathering of needed information for making fruitful decisions
that helps in successful completion of the project. Data collection is either structured
or unstructured depending upon the study, Questionnaire method was found to be
most effective. The questionnaire was structured and non-disguised. There was also
face-to-face conversation between the researcher and the respondents; the
respondents were also provided feedback and clarifications behind the questions.
This was deemed necessary in order to enable the respondents understand the
questions in the same context, as the researcher wanted.

This calls for collection of both primary and secondary data. In the present project
work, both types of data are collected for achieving the objectives of present
research study.

 Primary Data

These are those that are collected afresh for the first time, and thus happen to be
original in nature. Such data are administered by the authorities who themselves are
responsible for their collection. Methods used for collecting it are Observation and
Questionnaire.

Questionnaire: -

It is a formalized schedule to obtain and record specified and relevant information

with tolerable accuracy and completeness. As such it directs the questioning
process and promotes clear and proper recording. The questionnaire method has
been used for the present study as shown in the annexure. Once the questions have
been addressed the next step concerns the type of responses/questions. Questions
can be classified into two groups: -
a) Open-ended Questions- here lists of acceptable responses are not provided to
the respondent and they may answer in his/her own words.

a) Close-ended Questions- here list of acceptable responses is provided to the

respondent. Dichotomous subtype questions are used for the present study. This
allows only two possible answers. These questions are generally easy to ask and
answer.

Survey: -
Discussions with branch head of the bank

The Structured questionnaire was administered to the selected sample size of 50.

 Secondary Data

These are those which have already been collected by someone else and which
have been passed through the statistical process. The sources of secondary data
used for the present study include Internet, company journals and magazines.

The secondary data has been scrutinized before compilation to access it’s suitability,
reliability, adequacy and accuracy
(4.5) Procedure

A wise consumer comparison-shops for goods and services by evaluating quality, price,
location and service. Likewise trainers seek the most effective methods for conducting
needs analysis and for the evaluation of the training delivered. This means determining
how to obtain the useful information which to make decisions about training program
design and evaluation.

Once we have selected the best method to acquire the information needed, how this
method is putted into practice. In this context following questions must be asked:

➢ What data do I need?

➢ What are the sources of data?
➢ How do I go about collecting them?
➢ How will I analyze what I have collected?
➢ What does all collected data mean?

The term data refers to bits and pieces of detail from which information is derived;
therefore information is data that have been compiled in a useful way. Data and
information are not synonymous but complimentary. Decisions are made from
conclusions, which are obtained from information and information comes from data.

➢ Identifying the issue to be studied

➢ Determining what is already known about problem
➢ Making assumptions about the problem
➢ Identifying method to collect needed data
➢ Choosing or developing instruments that will results in collection of valid data
➢ Collecting the data
➢ Distilling the result of this collection
➢ Formulating conclusions and recommendations that address or resolve original
problem
 Chapter 5

Data Analysis
&
Interpretation
(5.1) Data Analysis

Age group

Income group (per annum in thousand)

Three Motorcycle Companies that comes in your mind?
Things that you looked while purchasing a bike?
How did you get to know about Hero Honda that you are

having at present?
Which other bikes would you prefer to buy?
I preferred Hero Honda Splendor than other bike?
(5.2) Data Interpretation

Marketing

Marketing is a social and managerial process by which individuals and groups obtain
what they need and want through creating, offering and exchanging products and
values with each other. In this way marketing is a business function that identifies
customer needs and wants, determines which target market the organization can serve
best, and designs appropriate products, services, and programs to serve these markets.

Marketing is much more than isolated business function it is the philosophy that guides
the entire organization. The goal of marketing is to create customer satisfaction
profitably by building-value laden relationship with important customers as well as fulfill
certain organizational objectives.

People throughout the various kinds of organizations-product or service, profit or non-

profit, domestic or global, small or large, need to know how to define and segment a
market and how to position themselves strongly by developing need satisfying products
and services for chosen target segment. They must know how to price their offerings to
make them attractive and affordable and how to choose and manage intermediaries to
make their products available to customers. And they need to know how to advertise
and promote products so customers will know and want them.

Marketing mix plan

Demographic Segmentation

• Income: Our customer survey indicates that the segments available for the
Hero Honda bike are the people with monthly income of Rs. 10,000 and
above.
• Age: The main segmented group for the motorcycle are 18 years and
above.

• Occupation: All kinds of people are taken into account. Students,

Professional , Govt. Servants, etc.

• Geographic Segmentation: The potential customers are basically from

every regions of India.
• Psychographic segmentation: People purchasing bikes are very stylish,
brand conscious.
• Behavioral segmentation: This segmentation is done considering
user status, benefit wise.

Targeting
The proposed targeting people in the age group of 18 years and above with a
monthly income of Rs. 10,000 and above, who are adventurous, enthusiasts
and socializing and who are either students or retired individuals or may be
employed as professionals, government servants or having their own business,
but mostly male.

Positioning
The image that Hero Honda creates in the mind of the customers is the faith.
The add shown by it says “Desh ki Dhadkan”. That means it’s a member of the
Indian family. It represents the Indian culture and society.

The objectives can be achieved through the implementation of suitable marketing

strategy by the organization. It is the marketing logic that is formulated keeping in mind
the needs of the consumers and also strategies of the competitors.

The 4 factors affect it is:

Product - The tangible offer to the market, which includes the product quality, design,
features, branding and packaging. The product is perfectly designed and all the
switch are well placed, which provides a good riding condition

Price – Pricing is an important component of marketing mix of firm. Determining

the prices of different products of a firm is a very difficult task of the marketing
manager. Price denotes money value of a product. It represents the amount of
money for which a product can be exchanged. In other words, prices represent
the money which the buyer pays to the seller for a product price represents the
exchange value of goods and services in terms of money. Price is all around.

Price factor has very well been touched by the manufactures. The manufactures
(Hero Honda) are charging very comparatively cheaper prices then their
competitors. The pricing strategy of the company is very set. They price their
product according to the cost of production and also by keeping an eye on the
price of the competitors of that segment & demand of the product in the market.

The pricing strategies adopted by Hero Honda Ltd.

The management of a firm decide to fix the price at the competitive level. This
method is adopted by Hero Honda because the bike market is highly
competitive.

The amount of money that customer pays for the product. The price of the product
should commensurate with its perceived value. If does not, the buyers will turn to
competitors products.

Place – Includes the various activities the company undertakes to make the product
accessible and available to a large number of target customers.

• There are about many regional offices located in major cities through out the
country.

• There are more than 10,000 dealers through out the country.

• For the product distribution the company distributes its products through
authorized dealers.
• The variety products are easily available in showrooms.

Promotion – The fourth marketing mix tool, includes all the activities the company
undertakes to communicate and promote its products to the target market. It consists of
advertising, sales promotion, public relations, and direct and online marketing.

The various promotional activities adopted by the Hero

Honda Company .

The company has 100crore rupees for its promotional activities out of which
75% is sponsored by the company and 25% from the dealers.

They may sign a celebrity for its promotional activities in recent futures.

The company provides six free services to its customers in comparison to its
competitors.

The company provides good services facilities to its customers through dealer’s
service station.

Dealers encourage its customers by giving discount, providing 0% interest loan

schemes, prices, coupons etc.

The various promotional activities adopted

• Credit & finance schemes

• Free services to the consumers

• Advertisements on Televisions, Newspapers, Magazines
• Road Shows
• Free trials for the new consumers
RESULTS

 Companies data shows that the company produces approximately 1,

11,000 vehicles per month. Out of which they sales 60,000 motor cycles
per month.

 The company has more demand of its product in western region.

 The company has 21 regional offices throughout India out of which 10

contains training centers.

 The main objective of these offices is to pay emphasis to human resource

development and provide good services to its customers.

Customer:

The results from customer survey are as follows:

1. Customers prefer because of their fuel efficiency.

2. Customers prefer because of their performance.

3. Customers prefer because they are value added product.

4. Customers also prefer because they are stylish.

Identified independent and dependent variables

Marketing communications
“Walk the Talk” though Advertising, sales Promotion, Public Relations, through an
emerging Media, including the Web these things are done through.

♦ Promotional Methods

♦ Promotional Mix

♦ Advertisement

♦ Sales promotion

♦ Public Relations

♦ Event Management

♦ Media Management

♦ Budgeting

♦ Measuring Effectiveness

And much more………………..

The internet’s greatest potential has been superbly exploited by the small business
ventures to reach customers directly. The market had virtually opened quickly to market
changes by providing accurate market intelligence, faster communication and greater
planning time. This helped to reduce the market volatility the dealer to understand the
significance and value of e-commerce and benefits of embracing the latest in
information technology, and initiate concrete steps to capitalize on it. The marketing is
also done through sales promotions, Advertisement, publicity, etc.

Strong dealer relationship expands the scope of the commercial paper programmed in
an organization and Hero Honda is doing that. They are doing the communication
through newspaper, magazines and television channels, etc.
(5.3) SWOT analysis

SWOT analysis of Hero Honda

Strengths:

• Technological support from Honda Motors, Japan.

• The company has a deeply penetrated dealer network.

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

• The company enjoys a huge market share and well established brands like
Splendor, Splendor +, Passion, CBZ, Ambition, etc.

• New CBZ Extreme for Sporty look.

Weaknesses:

• Hero Honda depends on Honda for new products and this is a big weakness
considering it from the post 2005 point of view. The reason being that the
technological tie-up between Hero Honda and Honda Motors of Japan will cease to
exist.

• The company doesn't have a product catering to Rs. 25,000 - Rs. 30,000 segment,
and the company might suffer on account of this as the imported motorcycles and
foreign players' motorcycles are expected to cater to this particular segment of the
market. This can result in fall in the market share of the company.

• The company imports about 31% of its spare requirements. This makes the
company vulnerable to the import policies of the government. It also exposes them
to the exchange rate risk.

• Not able to counter the Bajaj Pulsar, and TVS Apache success in the market.
Opportunities:

• The motorcycle segment is growing at the rate of 33%, which provides a great
opportunity for the company to cash on.

• Also it is experiencing a shift in the customer preference for 4-stroke mobikes. This
again provides an excellent opportunity to Hero Honda to leverage its market share
and market leadership for sustained profitability.

• Market needs better look and pick up with stylish appearance.

Threats:

• Wide acceptance of Bajaj Pulsar in the market. Market share of Bajaj and TVS is
increasing.

• The company has plans to foray into the scooter segment, which can also be a
major threat for the future prospects of the company. The reason being that the
consumers are shifting from scooters to motorcycles and at this hour moving from
motorcycles to scooters doesn't sound logical. Motorcycles form the major chunk of
the sales revenue of Hero Honda. A small proportion of the revenue comes from the
sales of spares.
SWOT analysis of TVS motor

Strengths:

• Technological support from Suzuki Motors, Japan.

• The company has a deeply penetrated dealer network.

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

• The company enjoys a huge market share and well established brands like Victor
GLX, Star City, Max 100, Apache etc.

Weaknesses:

• TVS Motor depends on Suzuki for new products and this is a big weakness
considering it from the post 2005 point of view. The reason being that the
technological tie-up between TVS Motors and Suzuki Motors of Japan will cease to
exist.

• The company doesn't have a product catering to Rs. 25,000 - Rs. 30,000 segment,
and the company might suffer on account of this as the imported motorcycles and
foreign players' motorcycles are expected to cater to this particular segment of the
market. This can result in fall in the market share of the company.

• The company imports about 21% of its spare requirements. This makes the
company vulnerable to the import policies of the government. It also exposes them
to the exchange rate risk.
Opportunities:

• The motorcycle segment is growing at the rate of 17.68%, which provides a great
opportunity for the company to cash on.

• Also it is experiencing a shift in the customer preference for 4-stroke motor bikes.
This again provides an excellent opportunity to TVS Motor to leverage its market
share and market leadership for sustained profitability.

Threats:

• The technical collaboration with Suzuki was valid only till 2005 and this is a serious
threat as they have been dependant on Suzuki for technology. Also Suzuki has set
up its 100% subsidiary in India which shall start producing motorcycles from 2004.
This will further increase the competition.

• The company has plans to foray into the scooter segment, which can also be a
major threat for the future prospects of the company. The reason being that the
consumers are shifting from scooters to motorcycles and at this hour moving from
motorcycles to scooters doesn't sound logical.

• Popularity of Bajaj Pulsar in the market.

(5.4) Objective wise analysis

To study the marketing mix of Hero Honda & TVS Motors.

4’ps of marketing of Hero Honda

Product
Hero Honda, which has a technology tie-up with Japan's Honda Motors, was currently
discussing the feasibility of manufacturing scooters for the Indian market, Mr. Munjal
said. However, the company has a binding clause with Honda's scooter manufacturing
Indian subsidiary, preventing it from making scooters till 2004.

Hero Honda Motors, India's largest motorcycle company, has launched the premium
segment 223cc motorcycle Karizma priced at Rs 79,000 (ex-showroom, Delhi). Many of
the products which the company has started with have been phased off. Now the
existing products are Karizma, Ambition, CBZ, Splendor, Splendor+, Passion, Passion
Plus, CD 100 SS, CD 100 and CD Dawn. Among these we are going to analyze only
three – (1) CBZ, (2) Ambition and (3) Splendor (4) Splendor +.

• CBZ

• Ambition

• Splendor

• Splendor +

The TCS study examines customer evaluations at three distinct ownership periods: 1 to
6 months, 7 to 18 months, and 25 to 36 months. This helps in understanding the
differences in satisfaction during initial ownership, in-warranty and post-warranty
ownership periods. Satisfaction ratings decline as the length of vehicle ownership
increases. However, Hero Honda Splendor is among the few models to maintain
consistency across the three ownership periods.
Pricing
Pricing is a important component of marketing mix of the firm. Determining the prices of
different products of a firm is very difficult task of the marketing manager. Price denotes
money value of a product. If represent the amount of money for which a product can be
exchange. In other words, prices represents the money which the buyer pays to the
seller for a product price represent the exchange value of goods and services in terms
of money. Price is all around.

Price factor has very well been touched by the manufacturers. The manufacturers are
charging very comparatively cheaper price i.e. Rs 45000 approx. The pricing strategy of
the company is very set. They price their product according to the cost of production
and also by keeping an eye on the price of the competitors of that segment and demand
of the product in the market.

A pricing strategy that ensured an average manufacturer margin that game dealer an
adequate return and created a reputation with consumers like “a company selling a
good quality product at a reasonable price. Industry focus them selves the low cost
producer with good quality and aimed to maintain the price advantage in every market
of two wheelers.

Hero Honda group ensures an easily affordable pricing through excellent transportation
to common man. I fixes customer centric pricing that provide customer total satisfaction.

Hero Honda’s pricing objectives are: List price, Discount, Financing schemes, Credit
terms, and Maximize profits

Hero Honda group ensures an easily affordable pricing through excellent transportation
to common man. It fixes customer centric pricing that provides the customer with total
satisfaction.

Place
HERO HONDA HAS direct contact with the dealers. There are no middlemen involved.
The dealers directly sell to the customers. The channel is of 1st level which has only the
dealers as the link between the customers and the company.

What Does Customer Want?

The customers of Hero Honda, according to the Asst. Manager (Sales) are very
particular about the colors that Hero Honda offers in its wide variety of scooters. He said
that the customers are very much aware of their purchase. Gone are the days when the
sales people could influence the buyer to buy a particular product. Almost 90-93% of the
customer, whoever comes to the showroom? Usually comes after he/she had made a
decision. So, the work of the sales person is less. The rest 7-10% have some doubts
with regard to the purchase of Hero Honda. It is here, where the sales persons have to
do some work in convincing the customers about the scooter. The sales person in this
regard conveys the customers about the mileage, strokes and also the parameters that
the customers enquire.

How Is The Price Determined According To The Change?

Manufacturer, on the basis of the cost of production determines the price and the
factors like tax and others. Usually the sales tax on the two wheelers is 8% but in Hero
Honda it 4%. This is because Delhi Government has found out that the pollution from
Hero Honda is very less due to the catalytic converter which every model of Hero
Honda have. The government has identified that by using the catalytic converter Hero
Honda is helping the environment which is a social cause. Hero Honda Bikes not only
have market in India, but also in abroad. To maintain the differences in market of the
different companies it takes the help of the local manufacturers or the dealers outside
for the distribution of their scooters smoothly.

Promotion
Advertisement, local events sponsorship and promotions and inviting a prominent
personality for the inaugural or first like delivery function would contribute effectively in
generating a wider local interest and attention.

Hero Honda’s latest DKD –2 commercial its two brand starring its Ambassador and
India’s heart throbs, Hritik Roshan and Sourav Ganguly, truly reflects the multi fact roles
that today’s new generation plays. The commercial reflecting the charisma and vibrancy
of these two stars, takes Desh Ki Dhadkan to dazzling new heights. It is young, colorful
and vibrant and represents the icons of contemporary times. And it will go a long way in
strengthening the leadership status of the product by the mile.

The new commercial is powerful film repeat with an impressive storyline. The effort to
pack the story, drama and impact in just 60 seconds was phenomenal challenge itself.
The idea was born itself. The idea was born out of the very essence of “Hero and
Stars”. Keeping in mind would cause on the drama and impact it would cause on the
audience. It is a commercial packed with action where today’s heart throbs, Hritik and
Sourav, are seen tackling new roles. The story being in a field adjoining a hill with two
cool men, Hritik and Sourav on Hero Honda bikes and Passion respectively.

These are some of the Slogan for every product (Bike) and these are following:-

CD-100 : Fill it, shut it, forget it.

CD100SS : Tough and Rugged.

Splendor : Designed to Excel.

Street Smart : License to enjoy.

Passion : When style matters, Bike born in studio not in factory.

CBZ : Motorcycling Unplugged.

Hero Honda : Leading the way.

4’ps of marketing of TVS motor company

Products
• Centra

• Fiero F2

• Fiero FX

• Max 100/R

• Scooty

• Scooty Pep

• Spectra

• Star

• Star City

• Star DLX

• Suzuki Fiero

• Victor

• Victor Edge Disc

• Victor Edge Drum

• Victor GLX

• Victor GX

With the Apache, TVS is now set to redefine the 150 CC segment. With this launch TVS
aims at strengthening its position in the premium segment of the motorcycle and
consolidate further on total volumes.
Advertisement of TVS motors
TWO-WHEELER major, TVS Motor Company, has come up with an improved
performance for the first quarter of this fiscal. The company continues to ride on the
success of the recently-launched four-stroke model, Victor. For the quarter ended June
2002, the turnover increased about 54 per cent to Rs 629.97 crore.

The `Victor' ride: The sharp spurt in motorcycle sales volume has been the key driver of
revenues. The sustained demand growth for Victor, coupled with the recovery in sales
volume of the two-stroke model, Max 100, aided an 88 per cent jump in motorcycle
sales volume.

Victor's success has improved the company's product-mix. An indigenously developed

product, the profit margin on Victor is relatively high, compared to Fiero and other
brands. This, in turn, has pushed up the operating profit margin to 9.23 per cent from
7.38 per cent in the corresponding previous quarter.

The margin expansion would have been even better, but for the increase in staff cost
and other expenditure. TVS Motor had signed up Sachin Tendulkar as its brand
ambassador. Notably, other expenditure (including advertisement and promotional
costs) increased to Rs 98.66 crore from Rs 69.42 crore.

The post-tax earnings increased 149 per cent to Rs 26.78 crore. The growth in net profit
was stunted by a rise in taxation provision to Rs 12.26 crore from Rs 3 crore in the
2000-01 first quarter. Deferred taxation of Rs 3.34 crore also played a part in pulling
down the bottom-line for TVS Motor.

The company's performance continues to ride on Victor. There is no evidence of

slackening of demand for this model with a 113 per cent rise in motorcycle sales in July
2002.

TVS Motor Company, India's premier two-wheeler manufacturer launched the TVS Cup
One Day International (ODI) Trination Series between India, Australia and New Zealand
in Chennai on October 22, with the symbolic unveiling of the TVS Cup. At a press
conference, Harish Krishnamachar, Vice President, Marketing, TVS Motor Company
unveiled the glittering TVS Cup alongside Indian Skipper Rahul Dravid and New
Zealand Skipper.

Promotion of TVS motors

Promotions at all cities hosting the matches will give everyone a chance to be a part of
the fun filled experience surrounding this event. TVS customers will get an opportunity
to participate in 'pitch on wheels', which is a 'hit wicket get ticket promotion" which
began on October 19. 'Pitch on wheels' is a promotional activity wherein a vehicle
promoting the match would make a round of the whole city prior to each match. The
spectators at the stadium too will be treated to a whole lot of entertainment in the form
of music and dance during breaks in the games. There would also be lucky draws for
everyone in the stadium with TVS bikes as prizes

How does TVS Motor create value for its customers and measure satisfaction
levels?
In addition to continuous innovation to improve the performance, features and durability
of our two-wheelers, we also benchmark the sales of the products and service
processes to offer better value to the customer. Customer service is provided through a
large network of fully equipped dealers, authorized and certified service points. The
service network is equipped with state of the art workshops, hydraulic and pneumatic
equipment, carbon emission devices, etc. A network of authorized spare parts stockiest
has also been set-up to ensure timely supplies.

We commission customer satisfaction surveys through specialist agencies on a

continuous basis to monitor the feedback, which is benchmarked to improve product
performance and satisfaction. The company was ranked second in overall customer
satisfaction and TVS Centra emerged as the top choice in the executive segment.

Since dealers are the first customers, a comprehensive dealer management system
(DMS) is being introduced to improve dealership sales and services processes. Regular
meetings of select groups of dealers, designated as 'presidents club' and 'antenna club',
are conducted to obtain feedback on customer's expectations and solve customer
problems.

To study various promotional strategies and know

about the current strategies keeping in mind the
cutthroat competition between Hero Honda & TVS
Motors.

Celebrity endorsement

Hero Honda has roped in film actor Hrithik Roshan, Former Captain of Indian Cricket
team Sourav Ganguly, Mohammed Kaif, Harbhajan Singh, Zaheer Khan, Yuvraj Singh
and Virender Sehwag as its brand ambassadors. The four players will join the current
Hero Honda brand ambassador and Former captain of the Indian team, Sourav
Ganguly, to form the Hero Honda `Team Ambition'. Incidentally, the `Ambition' is also
Hero Honda's latest launch in the market. Announcing the formation of the Hero Honda
`Team Ambition', Mr. Pawan Munjal, said, "Indian Cricket and Hero Honda have both
made the nation proud and helped the world recognize India's potential The `Team
Ambition' would also provide coaching and guidance to the budding talent in the country
and support cricket projects undertaken by Hero Honda in India and abroad, a company
release said.

Hero Honda will keep up its promotional activities with emphasis on cricket and
entertainment. The company claims that its Desh Ki Dhadkan campaign featuring brand
ambassadors Saurav Ganguly and Hrithik Roshan has received a very good response
and helped build the company's image. Last year, the company spent around Rs 90
crore on advertising and marketing.

Sales promotion of Hero Honda

A fundamental concern of any customer during the purchase of a double product is the
quality and provision of efficient service. After all queries on product quality,
performance, features and benefits have been satisfied, the customer invariably focuses
on the service factor for the product as the end objectives is to ensure trouble free
operation. In this respect servicing acquires paramount importance and Hero Honda’s
focus and emphasis on these key result area have been instrumental in establishing its
superiority and technological edge in the market. The host of training programmes and
relationship enchantment activity additionally backs the spates of servicing camp,
organized throughout the country. The active support of servicing and co-operation
rendered by the dealer in the form of logistics and infrastructure further aid in making
such programmes highly meaningful and valuable. They are doing free check up camps
reinforce customer trust. Service advisor’s collecting information from a customer about
his satisfaction level after the servicing of their bike. For the promotion of products the
Hero Honda dealer rally. Hero Honda is organizing so many events in sports, cultural
programmes, film -festivals etc for the promotion of the product eg. Hero Honda NKP
salue Challenger Cricket Cup brings new talent to the force, MALTA Junior Tennis
Tournament, Hero Honda social’s Commitment rehabilitating children affected by
violence, operational,

Relief, donation for drought relief, Rota Trade Mela 2000, Road Show, Training
programmers to enhance quality of service, free back up camps reinforce customer’s
trust, ride safe programmes held for Delhi Traffic Police, Mobile Revolution in servicing
etc.

The powerful benefits of test rides, special promotions and communication drives to
draw in the initial customers, preparation of accurate customer information forms to
create a customers database, offer of finance facility and active steps to impart specific
transiting at the dealer’s sales and services levels would be essential steps to
achieving the brand and the company objectives. Mr. Uppal also touched upon the
servicing policy for passion and cautioned the invitees to remain alert for substitution in
Hero Honda brands among its customers. The sales increase would have do be
targeted from new customers and not its existing ones. The key attitude that would
constantly contribute towards sales would be total and passionate commitment.

Publicity of Hero Honda

For the purpose of publicity Hero Honda is always organizing different events, etc. and
they are always inviting celebrities from film, sports, media, politics, etc. There is some
of event and parties are as follows:-

The Hero Honda stardust millennium Honours and BFJA awards for Bengali films.

In a gesture that honors and salutes some of the finest talent in south Indian Cinema.
Hero Honda also security sponsored the 20th Cinema Express Awards.

The sponsorship of the women’s World Cup in 1997 came next, then the ICC Cricket
World Cup 2003.

Hero Honda, the largest two wheeler leader in Indian sponsored the 21st Cinema
express Awards. Marketing Convention 2001. They are Priyanka Chopra, Miss World,
Lara Dutta Miss Universe, Diya Mirza Miss Asia Pacific, Sourav Ganguly Indian Cricket
Captain, Dealer Mehndi, Mr. Harsha Bhogle the famous cricket commentator etc.

Dandiya programme at Kota and Banswara. In this Ms Sunita Rao, the popular singer
entertains at the festivals at the Dandiya Programme.

Thrill and the excitement at the Hero Honda Master Golf tournament. In this tournament
Kapil Dev, virendra sehwag, Pronoy Roy, Milkha Singh and so many celebrities were
present.
 Marketing of TVS motors

TWO-WHEELER major, TVS Motor Company, has come up with an improved

performance for the first quarter of this fiscal. The company continues to ride on
the success of the recently-launched four-stroke model, Victor. For the quarter
ended June 2002, the turnover increased about 54 per cent to Rs 629.97 crore.

The `Victor' ride: The sharp spurt in motorcycle sales volume has been the key
driver of revenues. The sustained demand growth for Victor, coupled with the
recovery in sales volume of the two-stroke model, Max 100, aided an 88 per
cent jump in motorcycle sales volume.

Victor's success has improved the company's product-mix. An indigenously

developed product, the profit margin on Victor is relatively high, compared to
Fiero and other brands. This, in turn, has pushed up the operating profit margin
to 9.23 per cent from 7.38 per cent in the corresponding previous quarter.

The post-tax earnings increased 149 per cent to Rs 26.78 crore. The growth in
net profit was stunted by a rise in taxation provision to Rs 12.26 crore from Rs 3
crore in the 2000-01 first quarter. Deferred taxation of Rs 3.34 crore also played
a part in pulling down the bottom-line for TVS Motor.

The company's performance continues to ride on Victor. There is no evidence of

slackening of demand for this model with a 113 per cent rise in motorcycle sales
in July 2002.
 Advertisement of TVS motors
TWO-WHEELER major, TVS Motor Company, has come up with an improved
performance for the first quarter of this fiscal. The company continues to ride on the
success of the recently-launched four-stroke model, Victor. For the quarter ended June
2002, the turnover increased about 54 per cent to Rs 629.97 crore.

The `Victor' ride: The sharp spurt in motorcycle sales volume has been the key driver of
revenues. The sustained demand growth for Victor, coupled with the recovery in sales
volume of the two-stroke model, Max 100, aided an 88 per cent jump in motorcycle
sales volume.

Victor's success has improved the company's product-mix. An indigenously developed

product, the profit margin on Victor is relatively high, compared to Fiero and other
brands. This, in turn, has pushed up the operating profit margin to 9.23 per cent from
7.38 per cent in the corresponding previous quarter.

The margin expansion would have been even better, but for the increase in staff cost
and other expenditure. TVS Motor had signed up Sachin Tendulkar as its brand
ambassador. Notably, other expenditure (including advertisement and promotional
costs) increased to Rs 98.66 crore from Rs 69.42 crore.

The post-tax earnings increased 149 per cent to Rs 26.78 crore. The growth in net profit
was stunted by a rise in taxation provision to Rs 12.26 crore from Rs 3 crore in the
2000-01 first quarter. Deferred taxation of Rs 3.34 crore also played a part in pulling
down the bottom-line for TVS Motor.

The company's performance continues to ride on Victor. There is no evidence of

slackening of demand for this model with a 113 per cent rise in motorcycle sales in July
2002.

TVS Motor Company, India's premier two-wheeler manufacturer launched the TVS Cup
One Day International (ODI) Trination Series between India, Australia and New Zealand
in Chennai on October 22, with the symbolic unveiling of the TVS Cup. At a press
conference, Harish Krishnamachar, Vice President, Marketing, TVS Motor Company
unveiled the glittering TVS Cup alongside Indian Skipper Rahul Dravid and New
Zealand Skipper.

Sales promotion of TVS motors

Promotions at all cities hosting the matches will give everyone a chance to be a part of
the fun filled experience surrounding this event. TVS customers will get an opportunity
to participate in 'pitch on wheels', which is a 'hit wicket get ticket promotion" which
began on October 19. 'Pitch on wheels' is a promotional activity wherein a vehicle
promoting the match would make a round of the whole city prior to each match. The
spectators at the stadium too will be treated to a whole lot of entertainment in the form
of music and dance during breaks in the games. There would also be lucky draws for
everyone in the stadium with TVS bikes as prizes

How does TVS Motor create value for its customers and measure satisfaction
levels?
In addition to continuous innovation to improve the performance, features and durability
of our two-wheelers, we also benchmark the sales of the products and service
processes to offer better value to the customer. Customer service is provided through a
large network of fully equipped dealers, authorized and certified service points. The
service network is equipped with state of the art workshops, hydraulic and pneumatic
equipment, carbon emission devices, etc. A network of authorized spare parts stockiest
has also been set-up to ensure timely supplies.

We commission customer satisfaction surveys through specialist agencies on a

continuous basis to monitor the feedback, which is benchmarked to improve product
performance and satisfaction. The company was ranked second in overall customer
satisfaction and TVS Centra emerged as the top choice in the executive segment.
Since dealers are the first customers, a comprehensive dealer management system
(DMS) is being introduced to improve dealership sales and services processes. Regular
meetings of select groups of dealers, designated as 'presidents club' and 'antenna club',
are conducted to obtain feedback on customer's expectations and solve customer
problems.
Focus on comparative marketing strategies of Hero Honda &
TVS Motors

COMPARATIVE MARKETING STRATEGIES

Hero Honda has 20% of Honda’s sales in the world and Honda Motor of Japan is proud
to be associated with Hero Honda. As a staunch supporter, with technology and brand
support from the global power house, Honda Motors, Japan, would immensely boost the
business prospects in the country despite the onslaught of serve competition in the
market place. ‘ it is our avowed aim that Honda Motors’, scooters and Hero Honda’s
motorcycles would together corner 50% of the market share of two wheeler in the
country’.

Primary among these were the National Customer Survey by IMRB with a record
25,000 interviews, making it the largest two-wheeler survey. This way followed up by
the National Customer satisfaction survey in September 2000. In keeping with “Top
Gear”, the company also established customer finance tie-ups with Centurion Bank and
Tata Finance. In the present Scenario, this is available in 136 towns and to 232 dealers
a leading to a current volume of around 6000 per month. This represents as much as
25% of the total customers financing.

The dealers finance tie-ups with Citi Bank and Centurion Bank. The current sanctions to
as many as 189 dealers were worth Rs.61Crore, he revealed. There had also been no
opportunistic ad hoc price increases. The company also took positive steps to facilitate
the dealer “Authorized representative service extension policy. The corporate
commitment to “we are” and the company’s emphasis on environment protection also
resulted in opening the first effluent treatment plant at a dealership. New service training
centers were also established at Delhi and Chennai.

While quarterly product reviews were conducted with the factories, a unique programme
of joint visits with quality department land Japanese staff was also introduced. On the
spare parts front, multiple increases in spare policy was also overhauled and new,
innovative actions were taken leading to a volume of over 6,000 bikes in the current
year itself.

The company also associated itself actively with sponsorship of armed forced rallies,
notable among them being the Kargil Rally and the AOC Rally. While this built up its
relationship with premier customers, the initiatives taken on other priority fronts were
equally effective. Showroom standardization was effectively detailed. World event
sponsorships also helped the company to achieve global exposure for its brand,
particularly through such events as international spots tournament like the world Cup
Cricket, held in England in 1999. Plans for participating in the ICC World Cup
Tournament and sponsorships have already been finalized, right from the Mini World
Cup 2000 at Kenya to World Cup 2003 at South Africa.

The company’s entry into the tournament events sponsorships was equally successful.
Its sponsorship of Hindi Cinema awards(Millennium Honors held in Mumbai in January
2000, was followed up by sponsorship of Bengali cinema (BFJA Awards –Calcutta,
August 2000) and then South Indian Cinema (Cinema Express Awards- Chennai,
November 2000).

A laudable achievements was also the signing of the two top Leaders, veritable ‘Desh ki
Dhadkan’ in the field of sports (Cricket), and entertainment (Hindi films), three years.
Sourav Ganguly and Hritik Roshan the two stalwarts in their respective fields were also
designed as brand ambassadors for Hero Honda for a period of three years.

The national Launch of the Hero Honda passport programme specifically targeted at
enhancing customers relationships, the implementation of the Hero worldwide safety
riding campaign at dealer Level, and support extended to dealer during the customer’s
satisfactions survey.

To streamline operations and sales administration, the company also introduced the
service excellence awards for SSP’s decentralized the settlement of free service
coupons reimbursement, reorganized the Dharuhera Service Center as the National
Training Center, with latest technology to provide specialized advanced courses. Dealer
level implementation of the integrated dealership software package was also another
significant activity undertake.

The major success was the volume and revenue increase of by over two and half times
and a market share increase in motor cycles, from 36% to from 47% and in 2 wheeler, a
doubling from 13% to 26%. For the current year ending 2001, the company would
achieve a volume of over 1 million bikes under project “OM” and revenue in excess of
Rs.3000 crore. The spare parts business itself was striving for revenues of Rs. 145
Crores. Service reporting at all authorized outlets would exceed the five million mark.

The market perception inevitably revolved around the admirable achievement of Hero
Honda as the No:-1 two wheeler company in India. It revealed that the total customer
base of the company on a world wide basis had crossed the 4 million mark. The road
envisaged in the light of these facts was just an ambitious with the emphasis being to
sustain a growth rate of 15% per annum as well as be alert and responsive to new
development particularly the resurgent and aggressive competition with new players
and bikes as in addition to the China / WTO impact world trade organization.

Hero Honda’s own marketing initiatives as well as the emerging potential of second
hand motorcycle business. Key aspects in accessories business, social commitment
and socially relevant programmers, and communications drives were also pointed out.

Specific brand building and customers relationship exercise like the passport
programme, satisfaction survey, safety riding, campaign, service extension assistance
the various multi-levels training and development programmes, seminars and
workshops, CBZ club, product quality reviews and field quality visits were all essential
and

Indispensable ingredients to achieve the required results. And for this the most vital
input was inevitably the passion from one and all.

Auto mobile sales figure

Market share

The auto two-wheeler segment has been witnessing a mixed trend in year
2003-04. During the first seven months, the scooter volumes dipped and there
was a sudden spurt in the motorcycle sales. However there was some deviation
from this trend during October 2004 when the scooter sales stated picking up
due to launch of new variants by Hero Honda Ltd., But on the whole the
motorcycle market continued to prop up domestic 2- Wheelers sales whereas
scooters and moped sales maintained their downward trend in fiscal 2003.

The sales of motorcycle segment remained buoyant in Dec 2001 and the major
three players have reported an average growth of 55% in their sales volumes.
Bajaj Auto Ltd. Has been the outperformed in the motorcycle segment followed
by Hero Honda Motors Ltd. And TVS Motor Company Ltd. (formed after the
break-off with Suzuki Motor Corporation, Japan) with the whopping 85% growth
in the motorcycle sales Bajaj Auto Ltd. Is the second biggest manufacturer of
motorcycles?

Hero Honda has posted a negative sales growth of 8.75% from last month
November 2001 which is attributed to lower registrations for new purchases by
the customers in the last month of the year. With the rising rural demand the
company is optimistic of reaching the sales target of 1.4 million units for the
financial year ending March 2003-04.
Market share of different CC motorcycle

MODEL 2005 2006

Premium/lifestyle category (Rs 50000 and 45.25 29.16

above)

Commuter/Smart Category (Rs 40000-50000) 64.80 56.16

Economy category (Rs 30000-40000) 21.71 32.95

The Growth/Share Matrix for Hero Honda Motors Limited:

This matrix has often been used to examine the relative growth prospects of a firm’s
line of products. In the matrix, activities are classified according to their growth rate and
there competitive position or market share.

Hero Honda Motors Limited is a Star which has high market share and a high growth
rate.

They developed fuel efficient motorcycles at a time when everyone was producing 2-
stroke motorcycles. This made them gain market share at a rapid pace and helped them
to become the market leaders in the motorcycle segment. Having set its focus on
customer satisfaction, the company is determined to provide products and services that
meet the quality, performance and price aspirations of their customers. HHML wants to
provide its customers with value for their money.

Hero Honda's motorcycles account for over 45% of the entire motorcycles market. The
various brands of Hero Honda are Splendor, CBZ, Passion, Sleek, and Ambition.
Splendor enjoys nearly 30% of the total motorcycles market.

Sales comparison and market share

 COMPANY SALES UNITS 2006 MARKET SHARE

HERO HONDA 417014 46.01

BAJAJ AUTO 219554 24.22

TVS SUZUKI 162081 17.88

OTHERS 107673 11.88

Strategy
1. They must address the need for power in a new premium category and not in
commuter bikes.

2. Consumers are basically looking for fuel efficiency, durability, style, power and price.
Hero-Honda products the Splendor & Passion & TVS products the Victor GLX, Star
City offer fuel efficiency and durability. CBZ & APACHE offers style. Power and price
bikes. Now they must look for new products.

3. Not having proper in-house Product Engineering skills have caused Hero Honda
dearly. They must hence improve in-house Product Engineering skills.

4. Lack of product creation skills also means that the speed at which Hero Honda
launches new products is likely to be less than that of its rivals. Thus to launch new
products at a speed in line with their competitors is one strategy that Hero Honda
must look in to cash on.

5. The company uses both imported and indigenous raw materials and components to
manufacture the motorcycles. As a result, the increase or decrease in the import
tariffs has an impact on the company's bottom-line.
(5.5) Observations
After a study of various Hero Honda & TVS customers, we found the following:

♦ Geographical Distribution:

About 98% of the customers surveyed belong to congested areas of Delhi.

♦ Age group of customers:

About 90% of the customers were within in the age group of 20-35

♦ Income group of customers:

Most of the customers surveyed belong to middle income group.

♦ Occupation of the customers:

84% of the customers surveyed were official/ salesmen and 11% were students &
first jobbers.

♦ Percentage share of HHML and TVSL in two wheeler segment:

HHML holds 43% share.

TVSL holds 21% share.

♦ Customers preferences while purchasing a bike:

Fuel efficiency, looks, Low maintenance cost, Reliability

♦ Competitors of Hero Honda:

According to the survey reports the main rivals of Hero Honda are TVS Suzuki,
Yamaha, Bajaj Auto.

♦ Preference of Hero Honda over competitors:

About 89% of the customers believe that Hero Honda is better than the competitors
because of low maintenance cost and fuel efficiency.
(5.6) Findings

➢ Motorcycles are mostly used by youth between the age group of 20-35 years.

➢ Nowadays, Motorcycles are a symbol of Comfort, Passion and Economy in

sense of fuel efficiency.

➢ It was found that Hero Honda is the most preferred bike followed by Bajaj & TVS.

➢ The survey proved that all the bikes of Hero Honda are equally liked by Public.
But certainly, Splendor & Victor GL being the oldest model is still preferred more
by people.

➢ The survey also proved that Hero Honda has been able to retain quality while
launching new stylish bikes in face of competition.

➢ Splendor and Passion are unbeatable models of Hero Honda.

➢ Like wise Victor GL and TVS SCOOTY are unbeatable models of TVS.

➢ People appreciated the movement of Hero Honda in providing a new image to

Splendor and Passion by coming up with Splendor Plus and Passion Plus.

➢ Like Wise Victor GL coming up with Victor GLX.

➢ It was also found that consumer views Hero Honda as a bike which gives value
for money. This means over the years, Hero Honda has been able to retain its
Goodwill in customer’s eyes.

➢ Hero Honda is still the Leader in Bike Industry in India.

➢ Lastly, it was found that most no. of people carries a positive attitude towards
Hero Honda. Many of them are certain that they will buy Hero Honda Bike in
future.
 Chapter 6

Recommendation &
Suggestions
Recommendations and Suggestions
After the complete analysis of entire assignment we put forward a set of
recommendations which are a follows:

 Since the client has targeted the right segments, but the reason for the low sales of
Hero Honda is its dependability on Honda design.

 CBZ is high price. Moreover the client has positioned the bike as “city ride made
easy”. Low fuel –efficient bike as a result of which results in small segment of
customers.

 HHML is overlooking one feature in bike. Which is its low maintenance, and
reliability (i.e. less chances of breakdown) which are absent in its competitors.
Therefore in order to meet the sales target, two options are available with the client,
one is to redesign the bike and second is to reposition the bike as “bike with one
time investment” since redesigning of bike may involve a big task and huge
investment therefore we recommended repositioning the bike.

 In order to increase the market share, customer’s promotional activities should be

encouraged through advertisements to attract the male & female segment.

 Hero Honda, if it starts functioning independently, has to innovate and develop their
own technology to support their growth aspirations.

 The dissatisfied customers should be dealt with appropriately should be satisfied so

that they do not break the relationship with company.

 Service class segment has the huge potential for fuel efficient bikes with low
maintenance with some looks.

 Marketing strategy is the crucial part of the brand image building in the customer
mind which can be easily understood by the success of Bajaj Pulsar in the current
market.
 Chapter 7

Limitations &
Conclusion
(7.1) Limitations

While undertaking my Major project I was confronted with following limitation:-

• The constraint of time as I had only 6 weeks to complete my project.

• Due to lack of time I was not able to cover many customers.

• As I reside in Raipur so customers of only Raipur were taken into account.

• Answers given by the customers may be biased one.

• Research work was confined to definite area in Raipur.

(7.2) Conclusion

From the customers survey and desk research we conclude that:

 Most of the customers of Hero Honda belong to congested areas. They mostly
belong to middle class and are mostly officials/ executives. Thus, we conclude client
has targeted the right segment.

 From the findings we conclude that a customers while purchasing a bike, customers
takes into consideration mainly fuel efficiency, good looks, low maintenance cost
and reliability.

 The main competitors of Hero Honda are Bajaj Auto, Yamaha, TVS, and Suzuki.

 The consumer preference basically depends upon wider network and better
services.

 In addition to continuous innovation to improve the performance, features and

durability of our two-wheelers, we also benchmark the sales of the products and
service processes to offer better value to the customer. Customer service is
provided through a large network of fully equipped dealers, authorized and certified
service points. The service network is equipped with state of the art workshops,
hydraulic and pneumatic equipment, carbon emission devices, etc. A network of
authorized spare parts stockiest has also been set-up to ensure timely supplies.

 We commission customer satisfaction surveys through specialist agencies on a

continuous basis to monitor the feedback, which is benchmarked to improve product
performance and satisfaction. The company was ranked second in overall customer
satisfaction and TVS Centra emerged as the top choice in the executive segment.

 Since dealers are the first customers, a comprehensive dealer management system
(DMS) is being introduced to improve dealership sales and services processes.
 Regular meetings of select groups of dealers, designated as 'presidents club' and
'antenna club', are conducted to obtain feedback on customer's expectations and
solve customer problems.

 Customers are influenced more to buy a product by advertisements rather than

dealer friend’s or family recommendations.
 Chapter 8

Reference
References

NET SALES OF HERO HONDA BIKE IN FOLLOWING YEARS:

1985-86 43,000 units

1989-90 96,200 units
1998-99 5,30,600 units
1999-00 7,61,210 units
2000-01 10,29,555 units
2001-02 14,25,195 units
2002-03 16,77,537 units
2003-04 20,70,147 units
2004-05 26,21,400 units
2005-06 31,24,460 units
Highlights of Q2, FY'08-09 (Hero Honda)

• Total turnover(Net sales & Other Operating income)Rs 3202 crores, growth of 35.6 per
cent
• Net profit after tax at Rs 306.30 crores, growth of 50 per cent
• EBIDTA margin for the quarter 13.58 per cent
• Total sales for Q2 stands at 9,72,095 units, growth of 28.5 per cent
• Total sales for H1 stands at 18,66,349, growth of 19.7 per cent
• Over 55 per cent share in domestic motorcycle market
• Launches first-of-its kind music video to celebrate 25 years of Hero Honda

Hero Honda sold 3, 12,317 units of two-wheelers in May 2008, as compared to2,
85,109 units in the corresponding month last year. This comes close on the heels of a
nine per cent growth the company had reported in the month of April with sales of 2,
86,252 units of two-wheelers. Thus Hero Honda has already clocked a total sales of 5,
98,569 units of two-wheelers in this financial year.

Awards and Accolades

1992 Harvard Business school Awarded for Good Corporate Performance

1993 National Productivity Council Awarded for ‘Best performance in the Automobile
Sector.

1994 Hero Honda Chairman declared business man of the year, by Business India
magazine.

1995 National small Industries Corporation Ltd. Hon Ours our chairman with the
National Award for outstanding contribution towards development of small
scale Industries.

1998 Hero Honda becomes Number- 1 motorcycles Brand.

1999 Hero Honda receives ISO 14001 Certification for environment conservation.
2000 Splendor becomes the World’s number –1in two wheeler brand.
National Productivity Award for best performance in Automobiles and tractor
sector.

2001 Ranked amongst the top 10 Indian Companies by the Far Eastern Economies
Review.
Becomes World’s number –1 largest selling two wheeler.
 Chapter 9

Bibliography &
Webliography
Bibliography

 AME BUSINESS MAGAZINE.

 AUTO MAGAZINE.

 BUSINESS INDIA

 FINANCIAL EXPRESS

 BUSINESS LINE

 OVER DRIVE MAGAZINE.

Webliography

 www. Indiainfoline.com

 www. herohonda.com

 www.tvsmotor.com

 www.economictimes.com

 www.google.com
 Chapter 10

Annexure
(10.1) Questionnaire

CONSUMER SURVEY

Name: ______________________

Address: _____________________

Q1. Please mention your age group

18-20  21-25

 26-30  31-35

36- Above

Q2.) Please mention your income group (per annum in thousand)

 75-100 100-125

 125-150 150-175

 175 & above

Q3) Gender

 Male  Female

Q4) Martial Status

 Married  Unmarried

Q5) Please mention your occupation.

 Officials  Clerical or Salesmen

  Student  First Jobbers Retired

Q6) Name three motorcycle companies that come to your mind

 Hero Honda Motor Ltd.

 TVS Ltd.

 Escort Yamaha Motors Ltd.

 Royal Enfield

 Bajaj Auto Ltd.

Q7) What are the things that you look while purchasing a bike?

 Fuel efficiency

 Looks

 Low maintenance cost

 Reliability(less chances of breakdown)

 Least physical efforts

Low price

Q8) How did you get to know about Hero Honda that you having at present?

 Advertisement

 Family information

 Friend’s recommendation

 Dealer’s recommendation

Q9) How did you get to know about Hero Honda that you having at present?

 Advertisement  Dealer’s recommendation

 Family information  Friend’s recommendation

Q10) Which other bike would bike you have preferred to buy?

 Yamaha  LML  Hero Honda

 TVS Motors  Bajaj Pulsar

Q11) Prefer Hero Honda splendor than other bike because of:

 Fuel economy  less physical efforts

 Better looks  Low maintenance cost

Q12) Would prefer TVS Victor to Hero Honda Splendor because of:

 Fuel economy  Price

 Brand image  Low maintenance cost

Q13) What is the image of HERO HONDA in your mind?

 Economical

 Durable

 Smooth Bike

 Safe Bike

 Rough and Tough

Q14) What is the image of TVS Motors in your mind?

 Economical

 Durable

 Smooth Bike

 Safe Bike

 Rough and Tough

(10.2) list of tables
S.No. Particulars Page no.
1 Sales performance of Hero Honda 14
2 Market share of different CC motorcycle 69

3 Sales comparison and market share 70

4 Net sales of Hero Honda 80

5 Awards to Hero Honda 88

(10.3) list of figure

S.No. Particulars Page no.
1 Sales during 1999 – 2007 of Hero Honda 15

2 Market share 15

3 Market share of 125-250 cc motorcycles (2007-08) 22

4 Automobile sales figure 67