CHAPTER -1

INTRODUCTION TO THE STUDY

1| Page

Introduction

Indian oil corp. is marketing its lube oil under the brand name of Servo all across India. Servo has got many type of lube oil (e.g.:coolant, grease etc) incorporated under its umbrella name. Servo is also the market leader of Indian lube oil industry with a share of around 35% . Even after so many years of its launch & with such an old brand name, sales of Servo has gone down in the Indian Lube market. Such a failure of an established market leader is a cause of concern for the company officials. So, to analyze this failure (where the things or marketing strategy went wrong), an extensive research work is needed. Also recommendations are to be derived out on the basis of the research work to formulate new marketing strategy for Servoproducts. Research Problem The research problem was to analyze the fall in sale of servo. For this analysis to be carried out, we have to work on the various factors which are affecting the buying behavior of Engine Oil. These factors will be helpful in formulating new ideas or recommendations for the growth of company. Implementation of the following ideas will help in increasing the sales of Servo Geo. So, ultimately the goal of doing this project is:To Study the various factors affecting the buying behavior of Servo lubricants & to formulate schemes/ recommendations to improve its sales.

2| Page

The Indian Lubricant Market

India's total lubricants market was currently around 1.8m tonnes, the third largest in the world after the US and China. It is also one of the fastest

growing retail markets in India. Until 1993, it was a highly regulated market with a clear dominance of the public sector. Companies like Bharat Petroleum (BPCL), Hindustan Petroleum (HPCL), and Indian Oil Corporation (IOC) held more than 75 percent of the market share. In recent years, with the advent of the increasing number of multinationals in the Indian market there is a growing presence of private companies. Companies like Castrol, Elf Total-Fina, Gulf, and Shell Oil have made their presence felt in the market. It has been estimated that there is a presence of around 30 companies in lube market of India. All the oil companies are fighting to consolidate their position in market. The monopoly of the public sector holdings no longer exist. MNCs will be able to sell their products through petrol pumps. Lubes manufactured by Reliance Petroleum, Castrol, Elf, Gulf Oil etc, are now sold at petrol pumps. In the next couple of years, the industry is going to witness big changes. Retail networks, logistics management, and risk management are going to be the crucial factors. The stand-alone refineries will have to be merged with the marketing companies, as they do not have the distribution infrastructure to sell their products in a deregulated market. Companies like Reliance are already selling their products through petrol pumps.

Lube Oil After Post Liberalization

The first seeds of competition were sown in the early 1990s when following the liberalization of the Indian economy, the government decided to open the Indian market to foreign competition. Import of base oil, the key raw material, was de-canalized with IOC losing its status as the sole canalizing agent. Pricing of base oil was deregulated in a phased manner and currently it is now market determined. Basic custom duty on base oil stock was also reduced from a peak of 85 percent to a level of 25 percent. All quantitative restrictions were also
3| Page

removed. These developments naturally encouraged the entry of foreign players on Indian shores who were already facing a slowdown in demand in their local markets. The coming of foreign participants created an excess supply situation in the Indian automotive lubes market, which made it more difficult for the Indian lube manufacturers to survive. Recent deregulations in the lubricant market have promised many new opportunities for the private lube manufacturers. With the dismantling of Administered Price Mechanism (APM) the burden of subsidies is now being passed on to the government. Private participants will also gain a presence in the Indian oil and Gas sector and hence there will be competition between participants that will ensure the growth of the sector.

Market Size
Total production of automotive lubricants in India is approximately 8 to 10 percent of global lube production. Unlike other countries where lubricant demand has witnessed stagnation, the Indian market has been growing at approximately 7 percent per annum for the past 2 years. The public sector contributes to over 60 percent of the revenues for this market. MNCs have 5 percent market share and the remaining share is held by the unorganized sector. The overall Ratio of automotive/ industrial lubricants is around to be 65:35. Automotive lubricants are further divided into diesel lubes, petrol lubes& gas lubes. Diesel lubes comprise 70 percent of the market and petrol based lubricants & gas based lubricants cover the rest. As diesel lubes are used by commercial vehicles, which have to cover greater distances, their market share is higher. Engine oil constitutes around 83 percent of total sales volumes & in 58 percent in terms of market share. Gear oils, transmission fluids, hydraulic brake fluids, and engine coolants contribute to the balance. It is being estimated that by year 2012 the overall Indian lube oil industry will be 1.2 MMTPA which is being a market value of more than US $ 1 Billion. Also India is the Seventh largest Lubricant market in the world & Sixth largest automotive market in the world. The lube market will Expected to Grow at a Rate Of 5% in 2012-15.

SERVO - The Leader In India

SERVO has completed 30 years serving the lubrication needs of the Indian industry. SERVO is Indias No.1 lubricants brand not only in
4| Page

terms of sales but also in terms of quality and range. Servo has a range of over 470 grades of lubricants-oil and greases. Our wellequipped R&D center at Faridabad, perhaps one of Asias most advanced, is also Indias first in the petroleum industry to have received the ISO ())! Accreditation. This together with the fact that our lube blending plants at Mumbai, Calcutta, Chennai and grease plant at Vashi which produce SERVO, are also ISO 9002 certified ensures that SERVO lubricants meet international standards Servo has an excellent spread to meet the requirement of various automotive, industrial, marine, aviation and railroad applications .It is Indias largest selling lubricants brand and enjoys approvals from major Original Equipment Manufacturers (OEMs) including new generation cars. In India, SERVO is the unquestioned leader, with a 42% share in a market estimated at Rs. 55 billion comprising approximately one million metric tons of lubricants. Servos fundamental strength is its extensive spread of production units and distribution bases across the country. These include six lubricant blending plants and a grease manufacturing plant all of which are ISO accredited. SERVO als o ha s a formidable m a rke ting re a c h, tha nks to it s exclusive network of nearly 16,600 outlets/ stocklists and thousands of other multi- brand Lube Bazaar shops. SERVO offers a staggering range of lubricants for the automobile, industrial and marine industries. It is the lubricant of choice for most of the latest international automobiles that have been launched on the Indian roads. Another testimony to Servos reliability and quality is its extensive use by heavy-duty trucks, battle tanks of the Indian Army and the latest guided missile destroyers of the Indian Navy. SERVO has a notable presence in the highly competitive markets of the UAE, Nepal, Malaysia, Sri Lanka, Bangladesh and Mauritius. The companys aggressive m a r k e t i n g a n d a d v e r t i s i n g t h r u s t t o g e t h e r w i t h s t a t e -of t h e -art packaging has enabled SERVO to emerge as a truly global brand from India.

ACHIEVEMENTS
SERVOs striking achievement is a steadily rising customer approval for its products in India. The widespread popularity cuts across various customer segments and automobile user communities. Whether it is Hyundai Santro, Mitsubishi Lancer, Opel Astra, Daewoo Cielo, Fiat Uno or the Maruti family, SERVO serves them all. On its part, SERVO woos and wins its retail customers with a seductive combination of vehicle service, grocery shops and engine oil tie- ups with leading international automobile manufacturers.

PRODUCT
5| Page

SERVO primarily caters to three segments: automotive, industrial and marine. There are more than 450 different grades of lubes and oils, which cater to these sectors. The products for the automotive sector include 2T/4T oils, gasoline engine oils, diesel engine oils, gear and transmission oils, coolants and brake fluids and automotive greases. IOC is a major supplier to auto original equipment manufacturers (OEMs) like Tata Motors, Hyundai, Mahindra & Mahindra, Maruti and state transport undertaking like BEST, APSRTC, and RSRTC etc. SERVO provides more than 350 lubricants and greases to the industrial segment. The marine sector, too, has a broad range of products to choose from. This includes marine engine oils, hydraulic oils, gear oils, turbine oils, compressor oils and stern tube oils. SERVO is also meeting the lubricants requirements of the Indian defense forces. Notable among automobile products, SERVO 2T Supreme, is a new generation two-stroke e n g i n e o i l r e c o m m e n d e d f o r t w o -stroke engines in motorbikes, scooters, mopeds and outboard engines. Others in the category are Kinetic Ultra 2T, Bajaj SERVO Gen. 2T Zoom. SERVO 4T is a new generation four-stroke engine oil specially recommended for four-stroke engines in motorbikes and scooters.

SEGMENTATION OF AUTOMOTIVE LUBRICANTS

Automotive Lubricating Oils

6| Page

2/4 Stroke Engine Oils

1. SERVO 4T

Description: The new SERVO 4T with ECG protection technology has been specially developed for todays demanding 4-stroke motorcycle engines. It has been formulated with special additives to give all round protection for your bikes Engine, Clutch and Gear. Application: SERVO 4T is recommended for new generation 4 stroke motorcycles of every manufacturer like Bajaj, Hero Honda, TVS etc. Benefits --Excellent engine, clutch and gear protection --Maximum power output --Outstanding overall engine cleanliness and enhanced engine life Specifications JASO T903 : API SJ / JASO MA 2 Meet API SL Specification for Valve Train Wear (VTW) SAE 20W-40 Packs Available 210 ltr, 50 ltr, 1Ltr, 900 ml

2. SERVO 4T ZOOM
Description The new SERVO 4T Zoom high viscosity index base stocks and with superior additives has been specially developed for today's demanding 4-stroke motorcycle engines. This oil has been designed to meet the highest available specifications to give all round protection for your bike. Application SERVO 4T Zoom is recommended for new generation 4 stroke motorcycles of every manufacturer like Bajaj, Hero Honda, TVS etc. Benefits Excellent engine, clutch and gear protection
7| Page

 Excellent wear protection Higher fuel efficiency Specifications JASO T 903 : API SL / JASO MA 2 SAE 10W-30; SAE 20W-40 Meets API SM specification of Valve Train Wear (VTW) Packs Available : 900 ml

1. SERVO 2T SUPREME
DESCRIPTION Servo 2T Supreme is low smoke semi-synthetic two stroke engine oil developed to meet the critical requirements of high performance two stroke engines manufactured by leading auto makers. It is blended from selected base stocks and additives to minimise spark plug fouling and preignition, prevent rusting, minimise deposit formation and provide protection against seizure, scuffing and wear. It contains a diluent for easy mixing with gasoline. Servo 2T Supreme is green dyed product. APPLICATION
Servo 2T Supreme is recommended for lubrication of scooters, autorickshaws, motorcycles and mopeds operating on two stroke engines. The recommended dosage of Servo 2T Supreme is 20 ml of oil per litre of petrol.

PERFORMANCE BENEFITS
Low exhaust smoke . Maintains engine cleanliness. Minimises spark plug fouling . Reduces port deposits and ring sticking. Prevents seizure and scuffing.

PERFORMANCE STANDARDS
JASO FC specifications. API TC Specification

Manufacturers Approval

Servo 2T Supreme is approved by leading two stroke 2 and 3 wheelers manufacturers having petrol and oil injection lubrication system.

Diesel Engine Oils

8| Page

1. SERVO PRIDE SUPER 15W-40, 20W-50

DESCRIPTION Servo Pride Super 15W-40 is a premium quality Super High Performance Diesel Engine Oil (SHPDO). It is blended with high quality base stocks and carefully selected additives to meet the stringent requirements of various OEMs. APPLICATION Servo Pride Super 15W-40 is recommended for all types of diesel powered vehicles ranging from light commercial vehicles to heavy duty turbo charged diesel engines and also suitable for off-highway equipment and power generation sets operating on high speed diesel. PERFORMANCE BENEFITS

Increased oil drain period with potential of 45,000 kms under ideal operating conditions. Enhanced engine life. Ensures increased engine cleanliness. Reduced wear. All weather oil. Low oil top up.

1. SERVO PRIDE, 10W, 20, 30, 40, 50, MG 10W-30, MG 20W40

DESCRIPTION Servo Pride oils are heavy duty engine oils for diesel service. These oils are red in colour and blended from selected highly refined, high viscosity index base stocks and contain well balanced group of additives, to provide high detergency, dispersancy and anti oxidation characteristics to meet the stated performance standards. APPLICATION Servo Pride oils are recommended for: Naturally aspirated, supercharged and turbocharged diesel engines. High powered gasoline engines. Mixed fleet operation.
9| Page

PERFORMANCE BENEFITS Servo Pride oils Provide excellent resistance against wear and deposits in automotive supercharged diesel engines. Have exceptional thermal and oxidation stability to resist decomposition in supercharged engines operating with high ring zone temperature. Provide absolute control of corrosive wear that may result from use of high sulphur fuels because of good built-in alkaline reserves. PERFORMANCE STANDARDS
Servo Pride oils meet the following specifications: US MIL-L 2104C. API CF/CD . E-DL 3 of IS:13656-2002. Caterpillar Series 3. MACK T-7 test for oil thickening tendency. Sequence III F .

Passenger Car Motor Oils

1. MARUTI GENUINE OIL
DESCRIPTION Maruti Genuine Oil is high performance engine oil for new generation petrol vehicles. These oils are blended from high viscosity index base stocks and contain additives to meet the stated performance standards. This oil has been extensively evaluated under tough field driving condition. APPLICATION Maruti Genuine Oil is recommended for entire Maruti range of petrol vehicles. It is also suitable for other Indian cars. PERFORMANCE BENEFITS Superior performance in terms of oxidation stability, dispersancy characteristics and energy efficiency. Excellent sludge control and extra wear protection at high temperatures and severe operating conditions. Outstanding overall engine cleanliness and also provide long engine life.
10 | P a g e

 Fuel savings and low oil top up. PERFORMANCE STANDARDS API SF in gasoline and CD in diesel service. US Military MIL-L-46152 B E-PL 2 / E-DL 2 of IS: 13656- 2002. APPROVAL Maruti Udyog Ltd for all petrol vehicles i.e. Maruti 800/ Van / Gypsy/ Esteem/ Wagon R / Zen / Alto / Swift, etc.

1. HYUNDAI SERVO ENGINE OIL

DESCRIPTION Hyundai Servo Engine Oil is high performance engine oil for new generation Hyundai vehicles. These oils are blended from high viscosity index base stocks and contain additives to meet the stated performance standards. APPLICATION Hyundai Servo Engine Oil is recommended for Hyundai vehicles i.e. Santro and Accent. It is also suitable for new generation imported and Indian passenger cars using petrol and diesel. PERFORMANCE STANDARDS API SG in gasolene and API CF4 in diesel service. APPROVAL M/s. Hyundai Motors India Ltd for all Hyundai vehicles namely Santro, Accent, etc. PERFORMANCE BENEFITS Superior performance in terms of oxidation stability, dispersancy characteristics and energy efficiency. Excellent sludge control and extra wear protection at high temperatures and severe operating conditions. Outstanding overall engine cleanliness and also provide long engine life.
11 | P a g e

 Fuel savings and low oil top up.

MARKETING CHANNEL
The marketing channels for automotive lubricants in India consist of the following:

Petrol Stations Wholesale Distributors Lube Oil Shops Auto Spare Shops Authorised Service Stations Garages Rural & Agricultural dealers Super Markets

Till recently, the Indian consumers linked filling of lubricants to that of petrol & diesel in petrol stations. With the advent of deregulated market scenario & fierce competition, efforts are being made to position lubricant as a high involvement consumer goods. Hence, the resultant drift towards the bazaar trade i.e., outside the petrol stations. The sales of automotive lubricants through bazaar trade increased from a mere 10% prior to 1993 to a handsome present level of 40% compared to Worldwide Trend of more than 70%. In India, this job is still left to the mechanics & service stations.During these years this shift in trade had the following effects:

Decline in Market Share of PSU oil companies. Market became heavily crowded & the industry got transformed into FMCG. Dumping of products in the bazaar. Entry of spurious lubricants.

DISTRIBUTION NETWORK OF SERVO

Indian Oil Blending Ltd (IOBL) is a fully owned subsidiary of Indian Oil, engaged in the manufacturing of lubricants and greases and catering to the defense, railways, state transport among others. Where blending of lubricants (mixing of base oil with additives) is done at blending plants. After blending of lubricants, then filling of barrel, bulks work has to be done. And dispatched to SCFP. SCFP then moves the lube to Dealer Operated Godowns (DFOLG) and carrying and Forwarding Agent (CFA) . After that, product has dispatched to the following:
12 | P a g e

 Servo Stocklist automotive (SSA). Servo Stocklist Industrial (SSI). Direct Institutional Customers (such as Defence, Railways,

Govt. customers and large industrial customer). SSA deals with sales and promotion of products and supplies products in the market.

DISTRIBUTION NETWORK

CHAPTER- 2

COMPANY PROFILE

13 | P a g e

Indian Oil Corporation Limited :

The Indian Oil Corporation Ltd. operates as the largest company in India in terms of turnover and is the only Indian company to rank in the Fortune "Global 500" listing. The oil concern is administratively controlled by India's Ministry of Petroleum and Natural Gas, a government entity that owns just over 90 percent of the firm. Since 1959, this refining, marketing, and international trading company served the Indian state with the important task of reducing India's dependence on foreign oil and thus conserving valuable foreign exchange. That changed in April 2002, however, when the Indian government deregulated its petroleum industry and ended Indian Oil's monopoly on crude oil imports. The firm owns and operates seven of the 17 refineries in India, controlling nearly 40 percent of the country's refining capacity.

Origins
Indian Oil owes its origins to the Indian government's conflicts with foreign-owned oil companies in the period immediately following India's independence in 1947. The leaders of the newly independent state found that much of the country's oil industry was effectively in the hands of a private monopoly led by a combination of British-owned oil companies Burmah and Shell and U.S. companies Standard-Vacuum and Caltex. An indigenous Indian industry barely existed. During the 1930s, a small number of Indian oil traders had managed to trade outside the international cartel. They imported motor spirit, diesel, and kerosene, mainly from the Soviet Union, at less than world market prices. Supplies were irregular, and they lacked marketing networks that could effectively compete with the multinationals. Burmah-Shell entered into price wars against these independents, causing protests in the national press, which demanded government-set
14 | P a g e

minimum and maximum prices for kerosene--a basic cooking and lighting requirement for India's people--and motor spirit. No action was taken, but some of the independents managed to survive until World War II, when they were taken over by the colonial government for wartime purposes. During the war, the supply of petroleum products in India was regulated by a committee in London. Within India, a committee under the chairmanship of the general manager of Burmah-Shell and composed of oil company representatives pooled the supply and worked out a set price. Prices were regulated by the government, and the government coordinated the supply of oil in accordance with defense policy.

Objectives & Obligations Objectives

1. To further the national interests in oil andand reseller network serve enhance marketing infrastructure related sectors in 4. for providing assured service to customers throughout the country. 5. To create a strong research & development base in refinery processes, product formulations, pipeline transportation and alternative fuels with a view to minimizing/eliminating imports and to have next generation products. 6. To optimise utilisation of refining capacity and maximize distillate yield and gross refining margin. 7. To maximise utilisation of the existing facilities for improving efficiency and increasing productivity. 8. To minimise fuel consumption and hydrocarbon loss in refineries and stock loss in marketing operations to effect energy conservation. 9. To earn a reasonable rate of return on investment. 10.To avail of all viable opportunities, both national and global, arising out of the Government of Indias policy of liberalisation and reforms. 11.To inculcate strong core values among the employees and continuously update skill sets for full exploitation of the new business opportunities. 12.To develop operational synergies with subsidiaries and joint
15 | P a g e

ventures and continuously engage across the hydrocarbon value chain for the benefit of society at large. 13.To achieve higher growth through mergers, acquisitions, integration and diversification by harnessing new business opportunities in oil exploration & production, petrochemicals, natural gas and downstream opportunities overseas.

Obligations
1. Towards customers and dealers:- To provide prompt, courteous

and efficient service and quality products at competitive prices.

2. Towards suppliers:- To ensure prompt dealings with integrity,

impartiality and courtesy and help promote ancillary industries.

3. Towards employees:- To develop their capabilities and facilitate

their advancement through appropriate training and career planning. To have fair dealings with recognised representatives of employees in pursuance of healthy industrial relations practices and sound personnel policies.
4. Towards community:- To develop techno-economically viable and

environment-friendly products. To maintain the highest standards in respect of safety, environment protection and occupational health at all production units.
5. Towards Defence Services:- To maintain adequate supplies to

Defence and other para-military services during normal as well as emergency situations.

Financial Objectives

16 | P a g e

1. To ensure adequate return on the capital employed and maintain a reasonable annual dividend on equity capital. 2. To ensure maximum economy in expenditure. 3. To manage and operate all facilities in an efficient manner so as to generate adequate internal resources to meet revenue cost and requirements for project investment, without budgetary support. 4. To develop long-term corporate plans to provide for adequate growth of the Corporations business. 5. To reduce the cost of production of petroleum products by means of systematic cost control measures and thereby sustain market leadership through cost competitiveness. 6. To complete all planned projects within the scheduled time and approved cost.

Global Compact Initiative

Indian Oil perceives sustainable growth as an opportunity to enhance its business processes and practices, enabling it to positively impact its entire scope of business. The Corporations values drive the belief that responsible businesses can be profitable, leading to investments in the technologies & products and new energy infrastructure that will help shape the low carbon future. We see sustainable business practices as a defining element of competitiveness to maintain the Corporations status, equity and standing, both in the market and in the society in the coming decades. Our attention is on what we produce; how we buy and sell; how we affect the environment; how we recruit, train and develop our own people, how we invest in the community and respect the rights of people. IndianOil endeavors to develop its group businesses to deliver long-term strategic benefit and shareholder value by maximising synergies that sustainable development provides. Our societal obligations stood out even in our formative years, while we supported the mission of the defence forces to preserve the integrity of the nation, kept the home fires burning in rural India, fuelled major transport undertakings and worked on being a `national trust for economic 17 | P a g e prosperity. The same obligations continue with renewed

18 | P a g e

MAJOR PRODUCTS of INDIAN OIL

Indane Gas
Indane is today one of the largest packed-LPG brands in the world and has been conferred the coveted Consumer Superbrand status by the Superbrands Council of India. Having launched LPG marketing in the mid-60s, IndianOil has been credited with bringing about a kitchen revolution, spreading warmth and cheer in millions of households with the introduction of the clean and efficient cooking fuel. It has led to a substantial improvement in the health of women, especially in rural areas by replacing smoky and unhealthy chulha. Indane is today an ideal fuel for modern kitchens, synonymous with safety, reliability and convenience. With the status of an exclusive business vertical within the Corporation, the Indane network delivers 1.2 million cylinders a day to the doorsteps of over 53 million households, making IndianOil the second largest marketer of LPG globally, after SHV Gas of The Netherlands. Indane is available in compact 5 kg cylinders for rural, hilly and inaccessible areas, 14.2 kg cylinders for domestic use, and 19 kg and 47.5 kg for commercial and industrial use. LPG is a blend of Butane and Propane readily liquefied under moderate pressure. LPG vapour is heavier than air; thus it normally settles down in low-lying places. Since LPG has only a faint scent, a mercaptan odorant is added to help in its detection. In the event of an LPG leak, the vapourisation of liquid cools the atmosphere and condenses the water vapour contained in it to form a whitish fog, which is easy to observe. LPG in fairly large concentrations displaces oxygen leading to a nauseous or suffocating feeling.

Petrol/Gasoline
Automotive gasoline and gasoline-oxygenate blends are used in internal combustion spark-ignition engines. These spark ignition engine fuels are primarily used for passenger cars. They are also used in off-highway utility vans, farm machinery and in other spark ignition engines employed in a

variety of service applications. Gasoline is a complex mixture of relatively volatile hydrocarbons that vary widely in chemical & physical properties and are derived from fractional distillation of crude petroleum with a further treatment mainly in terms of improvement of its octane rating. An oxygenate is an oxygen-containing, ashless organic compound (such as an alcohol or ether) which can be used as a fuel or fuel supplement. Motor gasoline is sold at retail outlets where it is directly delivered into the automobile tank. The Indian Standard governing the properties of motor gasoline & gasoline-oxygenate blends is IS 2796 : 2000 (3rd Rev). In view of the auto fuel policy issued by Govt of India, more & more stringent specifications (equivalent to Euro II, Euro III, Euro IV) are being made applicable for the gasolines being marketed in India. This has led to reduction of environmentally polluting factors in gasolines.

XTRAPREMIUM XTRAPREMIUM petrol is a much sought-after fuel among discerning motorists who are in many ways emotionally attached to their wheels. The Clean and Keep Clean function of the super cleanser additive in XTRAPREMIUM reduces deposits at the port fuel injector, intake valve and controls combustion chamber deposits to maintain "like new" performance of the vehicle. Regular use of XTRAPREMIUM gives the vehicle a superior pick-up, smoother drive, better mileage and lower emission. XTRAPREMIUM is designed not only to optimise performance of new generation vehicles but also rejuvenate old vehicles to perform better. Little wonder, IndianOils XTRAPREMIUM petrol is the largest selling branded petrol in India.

Diesel/Gas oil

Petroleum derived diesel (called as petrodiesel) is a mixture of straight run product (150 C and 350 C) with varying amount of selected cracked distillates and is composed of saturated hydrocarbons (primarily paraffins including n , iso , and cycloparaffins), and aromatic hydrocarbons (including napthalenes and alkylbenzenes). Diesel is used in diesel engines, a type of internal combustion engine. Rudolf Diesel originally designed the diesel engine to use coal dust as a fuel, but oil proved more effective. Diesel engines are used in cars, motorcycles, boats and locomotives. Automotive diesel fuel serves to power trains, buses, trucks, and automobiles, to run construction, petroleum drilling and other off-road equipment and to be the prime mover in a wide range of power generation & pumping applications. The diesel engine is high compression, self-ignition engine. Fuel is ignited by the heat of high compression and no spark plug is used. The Indian Standard governing the properties of diesel fuels is IS 1460:2005 (5th Rev). Important characteristics are ignition characteristics, handling at low temperature, flash point. Diesel fuel often contains higher quantities of sulphur. In India , emission standards (equivalent to Euro II, Euro III, Euro IV) have necessitated oil refineries to dramatically reduce the level of sulphur in diesel in view of the auto fuel policy brought in force by Govt of India. BIS has brought out specification for "Diesel with 5% Biodiesel" that may be marketed in near future.

XTRAMILE IndianOils XTRAMILE Super Diesel, the leader in the branded diesel segment, is blended with world-class multi-functional fuel additives.

Commercial vehicle owners choose XTRAMILE because they see a clear value benefit in terms of superior mileage, lower maintenance costs and improved engine protection. A growing section of customers who own diesel automobiles, both in the lifestyle and passenger category, prefer XTRAMILE as a fuel for its added and enhanced performance. XTRAMILE has brought in a huge savings in the high mileage commercial vehicles segment. Transport fleets that operate a large number of trucks crisscrossing the country are using XTRAMILE to benefit from higher mileage and reduced maintenance costs.

Marine Fuels & Lubricants

IndianOil caters to all types of bunker fuels and lubricants required by various types of vessels operating throughout the world in the shipping industry. Bunker supplies are made at all major ports of India; Mumbai, Kandla, Vasco, Chennai, Tuticorin, Vizag, Cochin, New Mangalore, Kolkata, Paradeep, JNPT, Port Blair and Haldia. Apart from Indian Navy, whose 100% bunker requirement is met by IndianOil, it also supplies bunker fuels to all major shipping and dredging companies of India. Spot requirement of different vessels calling at Indian ports are met through nominations received from local shipping agents and international bunker traders/brokers. While IndianOil supplies Furnace Oil (FO) and High Flash High Speed Diesel (HFHSD) meeting stringent BIS specifications, it also offers the entire range of SERVO brand marine grade lubricants. Supplies are made through pipelines, barges and tank trucks. Bunker supplies are undertaken through pipeline at specified jetties at Haldia, Vasco, Port Blair, Mangalore, Visakhapatnam, JNPT (Mumbai) and Chennai. Tank trucks are used for bunker supplies at Tuticorin, Paradip, Port Blair, Mangalore and Haldia. Barges are used for bunker supplies at jetties and inner anchorages at Haldia, Mumbai, Kandla, Visakhapatnam, Kochi and Chennai. IndianOil has also started supplying Bonded 380 cst FO bunker fuel from Chennai from May 2009 as per ISO 8217:2005 specification.

ATF/Jet Fuel

IndianOil Aviation Service is a leading aviation fuel solution provider in India and the most-preferred supplier of jet fuel to major international and domestic airlines. Between one sunrise and the next, IndianOil Aviation Service refuels over 1500 flights from the bustling metros to the remote airports linking the vast Indian landscape, from the icy heights of Leh (the highest airport in the world at 10,682 ft) to the distant islands of Andaman & Nicobar. Jet fuel is a colorless, combustible, straight-run petroleum distillate liquid. Its principal uses are as jet engine fuel. The most common jet fuel worldwide is a kerosene-based fuel classified as JET A-1.The governing specifications in India are IS 1571: 2001 (7th Rev). IndianOil is India's first ISO-9002 certified oil company conforming to stringent global quality requirements of aviation fuel storage & handling. IndianOil Aviation also caters to the fuel requirements of the Indian Defence Services, besides refueling VVIP flights at all the airports and remote helipads/heli-bases across the Indian subcontinent. IndianOil Aviation group regularly organises International Aviation conferences that act as a vital information facilitator with participation from leading international and all domestic airlines, allied industries, statutory aviation authorities and government agencies from over 35 countries. IndianOil is the only oil company in India to market the widest possible range of fuels used by the aviation industry in India- JP-5, Avgas 100LL, Methanol Water Mixture, Jet A-1 and aviation lubricants, etc. Aviation Turbine Fuel (ATF) is dispensed from specially designed refuellers, which are driven up to parked airplanes and helicopters. Major airports have hydrant refuelling systems that pump the fuel right up to the filling outlets on the tarmac through underground pipelines for faster refuelling. Essentially, ATF is pumped into an aircraft by two methods: Overwing and Underwing. Overwing fuelling is used on smaller planes, helicopters, and piston-engine aircraft and is similar to automobile fuelling - one or more fuel ports are opened and fuel is pumped in with a conventional pump. Underwing fuelling, also called single-point is used on larger aircraft. To ensure that you receive the best service, every one of our 101 AFSs follows specific quality audits based on a Quality Control Index System

benchmarked to global standards. In addition, 15 Quality Certification Laboratories provide complete specification tests round-the-clock. Ensuring that these standards are always upheld, there is a back up of a highly skilled, qualified and dedicated team of officers and refueling crew. IndianOil has a strategic partnership with Air BP, the world leader in aviation business. IndianOil regularly organizes seminars, symposiums and workshops to constantly interact with its partners, which apart from being a two-way channel of communication, helps us to stay abreast with advances in technology.

CHAPTER-3

RESEARCH METHODOLOGY

Research Objective

To understand the Lube industry (mainly lube market of Kolkata) from the Secondary Research. To carryout comparative analysis of all the major brands of the Lube industry. T o undertake exploratory survey of lubricant market of Kolkata with the help of three wheeler Auto rickshaw drivers, Taxi owners, shopkeepers selling engine oil & vehicle mechanics. To formulate questionnaire on the basis of the survey. This questionnaire will be formed on the basis of factors being told by the three wheeler Auto rickshaw drivers, Taxi drivers, shopkeepers selling engine oil & vehicle mechanics. Also the questionnaire will be different for all the four categories. To analyze all the survey data & formulate recommendations based on it.

Scope of the study

The research work will be totally concentrated inside the Kolkata region. The Research work will cover the respondents from the three wheeler auto drivers, Taxi owners; shopkeepers selling lube oil & mechanic personnel.

Type of research
The research work conducted is exploratory & descriptive in nature. This research work is used to investigate the factors which are affecting the buying decision of engine oil & marking perception of all stakeholders about various engine oil brands available in market. Its an exploratory and descriptive research, as it has using both the secondary data and surveys respectively.

Sources and tools of data collection a) Primary Data

The data was be gathered through a survey based research approach with the help of questionnaire. The questionnaire was made in English but it was translated to Bengali language for the convenience of the respondents. As the research work of writing & asking question was totally carried out by one person only, so human error related to recording of responses cannot be totally ruled out.

b) Secondary Data
The source of secondary data was the articles on the engine oil mentioned on the internet. The sources of all the sites are mentioned in bibliography and under the subscript where ever it is used in this report.

Sample Size
Total Population: 500. Sample size: 250.

There were 3 types of questionnaires which were formulated to carry out this research work. The sample sizes for each type of questionnaire are as follows:-

1) Auto Rickshaw : - The sample size for this survey was 100 Auto drivers. 2) Taxi Owners : - The sample size for this survey was 100 Taxi drivers. 3) Shopkeepers : - The sample size for this survey was 50 shopkeepers.

Time Span of Study

The time span of my study is 32 days.

Limitation of the Research

There were few limitations in this research work. The sample covers all the major portions of Kolkata, but still it was not able to cover the full width of Kolkata. This limitation is because of the time span. So, there is a much broader need to increase the sample size to get more concrete results. Also the secondary data on lubricants available on internet is not sufficient. There is no where mentioning of % wise market share of type of lubricants in Kolkata. This data was needed to check the % error in the report. So, error in report cannot be reported which is a big limitation of the given analysis. One of the limitations was that, I was the only person involved in reporting the data. Therefore, asking of same question from so many people can register some error in reporting the data which is called human error.

CHAPTER- 4

ANALYSIS AND PRESENTATION OF DATA

Market Share of the Indian Lubricant Industry

Indian Oil Corporation

[Market Share: 42%]

Indian Oil is Indias flagship national oil company with business interests straddling the entire hydrocarbon value chain from refining, pipeline transportation and marketing of petroleum products to exploration & production of crude oil & gas, marketing of natural gas, and petrochemicals. It is the leading Indian corporate in the Fortune 'Global 500' listing, ranked at the 125th position in the year 2010. With over 34,000-strong workforce, Indian Oil has been helping to meet Indias energy demands for over half a century. With a corporate vision to be the Energy of India, Indian Oil closed the year 2009-10 with a sales turnover of Rs. 271,074 crore and profits of Rs. 10,221 crore. At Indian Oil, the operations are strategically structured along business verticals - Refineries, Pipelines, Marketing, R&D Centre and Business Development E&P, Petrochemicals and Natural Gas. To achieve the next level of growth, Indian Oil is currently forging ahead on a well laidout road map through vertical integration upstream into oil exploration & production (E&P) and downstream into petrochemicals and diversification into natural gas marketing and alternative energy, besides globalisation of its downstream operations. Having set up subsidiaries in Sri Lanka, Mauritius and the United Arab Emirates (UAE), Indian Oil is simultaneously scouting for new business opportunities in the energy markets of Asia and Africa. With facilities at multiple locations and ever-expanding market opportunities, Indian Oil is poised to become an integrated energy company with steady forays into Oil Exploration & Production, Petrochemicals and Renewable Energy. TIE UPS: Hyundai Santro, Mitsubishi Lancer, Opel Astra, Daewoo Cielo, Fiat Uno or the Maruti family.

Castrol India

[Market Share: 22%]

The history of Castrol in India dates back to 1910 when certain automotive lubricants from C C Wakefield & Company made an entry in the Indian market. In 1919, C.C Wakefield & Company set up its first overseas branch office in India and commenced operations as a trading unit. Today, Castrol India Limited is the second largest player in the Indian lubricant industry and

is the market leader in the retail automotive lubricant segment. Castrol India is part of the BP Group worldwide. Castrol India Limited is a Public Limited Company with 70.92% of the equity held by Castrol Limited UK (part of BP Group). In 2003 the company's turnover was Rs.1360.51 crores and profit after Tax was Rs. 137.38 crores. From a minor oil company, with a share of about 6% in 1991, Castrol India has grown to become the second largest lubricant company in India with a market share of around 22%. Castrol India manufactures and markets a range of automotive and industrial lubricants. It markets its automotive lubricants under two brands Castrol and BP. The company has leadership positions in most of the segments in which it operates including passenger car engine oils, premium 2-stroke and 4-stroke oils and multigrade diesel engine oils. Castrol India has the largest manufacturing and marketing network amongst the lubricant companies in India. The company has 5 manufacturing Plants across the country, including a state-of-the-art plant in Silvassa. The company reaches its consumers through a distribution network of 270 distributors, servicing over 70,000.retail outlets. Castrol India has clearly demonstrated its commitment to Indian consumers for over 80 years, by offering its international range of high performance products backed by the highest level of customer service. TIE UPS: Company has partnership with leaders like Mahindra and Mahindra, Tatas, JCB Escorts. For the marketing of its lubricants it has tied up with the petrol pump chain of Reliance and Essar , thereby gaining access to a new channel of distribution.

Hindustan Petroleum Corporation Limited

share:16 %]

[Market

HPCL is a Fortune 500 company [rank-354] , with an annual turnover of Rs. 1,08,599 Crores and sales/income from operations of Rs 1,14,889 Crores (US$ 25,306 Millions) during FY 2009-10, having about 20% Marketing share in India and a strong market infrastructure. HPCL operates 2 major refineries producing a wide variety of petroleum fuels

& specialties, one in Mumbai (West Coast) of 6.5 Million Metric Tonnes Per Annum capacity and the other in Vishakapatnam, (East Coast) with a capacity of 8.3 MMTPA. HPCL holds an equity stake of 16.95% in Mangalore Refinery & Petrochemicals Limited, a state-of-the-art refinery at Mangalore with a capacity of 9 MMTPA. In addition, HPCL is constructing a refinery at Bhatinda, in the state of Punjab, as a Joint venture with Mittal Energy Investments Pte. Ltd. HPCL also owns and operates the largest Lube Refinery in the country producing Lube Base Oils of international standards, with a capacity of 335 TMT. This Lube Refinery accounts for over 40% of the India's total Lube Base Oil production.

Bharat Petroleum Corporation Limited

7%]

[Market Share:

Bharat Petroleum Corporation Limited (BPCL) is one of the largest state-owned oil and gas company in India, with Fortune Global 500 rank of 307 (2010). Its corporate office is located at Ballard Estate, Mumbai. As the name suggests, its interests are in downstream petroleum sector. It is involved in the refining and retailing of petroleum products. Bharat Petroleum is considered to be a pioneer in Indian petroleum industry with various path-breaking initiatives such as Pure for Sure campaign, Petro card, Fleet card etc. BPCL was also one of the foremost organizations to implement ERP successfully across its business domain. It helped to centralize data and subsequent analysis to meet the challenging market scenario and is still termed as a landmark in the sector. BPCL is a member of the elite group, which SAP consults for further improvements in its Oil & Gas related products.

Gulf Oil

[Market share: 3%]

The Chemical Hub of Hinduja Group was created with Gulf Oil India Limited merging with IDL Industries Limited from 1st January 2002. The merger has enabled the Company to leverage the large marketing networks of lubricants and industrial explosives businesses and achieve a turnover for the financial year 2008-09 of Rs.1000 crore (US$200 million). Exports accounted for 5% of the turnover.

Gulf Oil International was the first multinational to enter the lubricants market in India. In collaboration with the Hinduja group, Gulf Oil India created a significant presence in a short time; Gulf Oil has grown to be one

of the largest corporations in the world, with operations ranging from oil exploration to retailing. On the financial front, the companys performance has been satisfactory. The company has setup its own 75000 tonne blending plant has Silvassa which blends 200 quality lubricants with international formulations.

Shell

[Market share: 3%]

Royal Dutch Shell is the largest and most diversified international investor in India's energy sector among all global integrated oil companies with nearly US$1 billion invested already. It is the only global major to have a fuel retail license in India. Besides being a major private sector supplier of crude, products, chemicals and technology to public/private sector oil companies, Shell also has key interests in lubricants, bitumen while operating an LNG receiving and re-gasification terminal, as well as a significant Technology center and a financial business services center. India has been a focus country for investments from the global Shell Foundation, which has already spent over USD 10 million to date impacting more than 2 million people.

Tide Water

[Market share: 2%]

Tide Water has been a pioneer of Automotive and Industrial lubricants in India since 1928 and has five plants at Howrah, Oragadam, Turbhe, Silvassa and Faridabad. Its repertoire of automotive products includes engine oils for trucks, tractors, commercial vehicles, passenger cars and two/three wheelers. It also produces gear oils, transmission oils, coolants and greases for automobiles. For industrial application it manufactures industrial oils, greases and speciality products like metal working fluids, quenching oils and heat transfer oils. Tide Water has tie-ups for manufacture of genuine oils with a number of renowned OEMs in the automotive and industrial equipment segment. The company also has technical collaboration with JX Nippon Oil & Energy Corporation, the No.1 petroleum conglomerate in Japan. Superior quality lubricants under the brand name Eneos are manufactured and marketed in India by Tide Water Oil.

SWOT ANALYSIS
STRENGTH
Indian Oil Corporation (IOC), Indias largest commercial enterprise and the only global Fortune 500 Company, ranked 125th by revenue in the year 2010, owns SERVO.

Servo has been designated as a Super Brand. Indias no. 1 lubricant brand in term of Sales (42% market shares) Servo oil has wide range of over 400 grades for automotive, industrial and marine use. Distribution network with 204 Servo Stockist all over India.

Strong presence of countrywide network of bazaar traders.

more

than

11,000

retailers,

beside

Indian Oil modern and well-equipment R&D center at Faridabad, One of the most advanced in Asia, keeps pace with international standards. ISO 9002 certified lube-blending plants of IOC at Asaoti, Mumbai, Calcuttta, Chennai and grease plant at Vashi (near Mumbai) ensure that SERVO lubricants produced their meet International Standards. SERVO range of lubricants is fast emerging as a Global brand with wide acceptance in UAE, Malaysia, Mauritius, Bangladesh, Bahrain, Sri Lanka, Nepal, Yemen, Kenya, Kuwait, Burkina Faso, Reunion Island and other markets. Genuine Oil tie ups with Hyundai motors, Maruti Udyog kinetic Motors and Equipments Ltd., Mitsubishi Lancer, Kumatsu, CKD Skoda, Elgi Air compressor etc. Ltd., L&T

OPPORTUNITY
Overseas market.

Foray into the untapped Rural Market, which constitutes 85% of the market. Leverage its financial strength for expansion of customer base through strategic alliance with Original Equipment manufacturers. Continuous improvement in the technology in the end user industry because of continued growth of the light commercial vehicle (LCV), Passenger Car Motor Oil (PCMOs) and Multi Utility Vehicle (MUV) segments and rapid shift to 4-stroke engines in the 2wheeler segments. Opportunities for growth are likely to result from Foreign Direct Investment particularly in the Transport Equipment Manufacturing (TEM) and Machinery manufacturing segments.

WEAKNESS

Lags behind in promotional activities. Being a PSUs, decision-making process is slow. Significant improvements are requirement in packaging of lubes as often there are complaints of leakage or the quantity being short.

THREAT

An increase in base oil price with no corresponding increase in product price coupled with additional advertising expenditure is likely to keep margins under pressure. Government has already given permission to Reliance, Essar Oil, ONGC, Shell and Numaligargh Refinery to set up retail marketing stations thereby giving rise to stiff competition. Due to lack of promotional activities competitors like BP and Castrol etc. are gradually taking away the market. Tie ups of players in the market with automotive companies and OEMs like the tie up of Castrol with Mahindra & Mahindra for supply of the diesel engine oil for its tractors is gradually eroding the market share of SERVO.

SERVO Lubricants MARKETING AND PROMOTION TECNIQUE

SERVO continues to be the dominant player in the Indian lubricant sector backed by cutting edge product development, high quality customization and extensive blending and distribution network. For customers, the SERVO

range is a one-stop shop for providing complete lubrication solutions in the automotive, industrial, agricultural and marine sectors. In the retailing segment, besides IndianOil petrol stations, SERVO lubricants are marketed through exclusive SERVO shops, SERVOXpress centres, auto spare parts and bazaar shops across the country. IndianOil's technical service Engineers are available on call to provide on site Tribology consultancy and value added services. Backed by incisive knowledge of equipment, processes and machinery, IndianOil team can provide solutions to just about anything automotive or industrial. You name it, SERVO will tame it. Margins and Discount Schemes The company mostly sell their products through stockiest, dealers, distributors, mechanics, and retail stores. Maximum sales are achieved through mechanics and retail stores. Margins and discount schemes offered to the storeowners and mechanics prompt them to sell and promote a particular brand. Prices and Promotion The transformation from the administered pricing mechanism to free pricing has increased the importance of providing cost effective product to the users. Thus product costing and competitive pricing are key factors affecting the market.

couple of years, the industry is going to witness sea changes. Retail networks, logistics management, and risk management are going to be the crucial factors. The stand-alone refineries will have to be merged with the marketing companies, as they do not have the distribution infrastructure to sell their products in a deregulated market. Companies like Reliance are already selling their products through petrol pumps. The monopoly of the public sector holdings will no longer exist. MNCs will be able to sell their products through petrol pumps. Lubes manufactured by Reliance Petroleum, Castrol, Elf, Gulf Oil etc, which are now sold at petrol pumps. In medium to long term, Frost & Sullivan expects private sector companies to have a market share of around 25 percent.

ANALYSIS AND INTERPRETATION OF DATA CUSTOMER FEEDBACK

AUTO SURVEY
1) OWNERSHIP OF AUTOS
Is the auto: o Self owned o Rented one The first question is asking the auto drivers about the ownership of their auto vehicles. The findings are shown below:-

Findings
The above chart shows that in Kolkata there are around equal % of both self owned auto drivers and rented auto drivers.

Conclusion
From this survey, we also figure out that the self owned category consists of two types of drivers. The first type of drivers have taken loan to buy the auto (i.e. is called second party financed auto). The second types of drivers

have invested their own money to get an auto.

2) %Market share of Engine Oil in 3-Wheelers Auto Segment

The second question consists of asking the auto drivers about the usage of Engine Oil in their respective autos. The findings about % market share are shown below:-

Findings

The above Pie chart shows the % share of each major CNG brand oil in 3-wheeler market. The above chart reveals that MAK GE (from Bharat Petroleum) is the leader in this segment. MAK GE has scored this first position due to various reasons which will be put across in the later stage of Primary Research. All these major brands (MAK GE, BP, Castrol & Valvoline) constitute around 90 % of market.The remaining market is hold by the other small companies with an exception of a Big company called INDIAN OIL which market SERVO GEO in this segment & has only about 6% market share.

OWNERSHIP VS PRODUCT USAGE

The chart below is derived from the first two questions. The Conclusion part is given below:-

Findings

The above chart shows the % wise usage of brand engine oil each by the Self owned Auto drivers & Rented auto Drivers. The maximum difference in all the major brands, by the two categories of auto drivers is merely in between 3-5 % except for Servo, The difference (for Servo) is around to be 9% in two categories of Auto Drivers.

3) FACTORS INFLUENCING THE BUYING DECISION

The chart below is derived from the third question. The question discussed before this analysis (3rd question) mainly talks about the selection factors for various brands From that particular question the %wise preference, for each factor used by the auto drivers to buy any oil brand is given below.

Findings
The above pie chart shows that the around 50% market of taxi segment is being influenced by the quality parameter.

4) PACKAGE USAGE IN LUBE OIL

The fourth question was about the general purchase of package of engine oil. The result is shown in the form of Pie chart.

Finding & Conclusion The pie chart clearly states the fact that the auto drivers are most likely to buy 1 Lt of lube oil whenever they go for purchase of engine oil. So, the company should properly implement its marketing strategy on 1 lt pack to develop & increase its market share.

5)SELECTION FROM THESE THREE OFFERS

There are three factors which are studied .The factors are as follows: Discount: The drivers were asked about their liking regards to Discount in engine oil. Gift: The Drivers were asked their preference for the complimentary Gift with engine oil.

Anything in these two offers. These three factors were asked from the auto drivers & their result is summarized in pie chart given below.

FINDINGS From the pie chart it can be concluded that the auto Drivers want maximum discount in the price of engine oil. It means indirectly they want that the price of engine oil should be as low as possible .So we concluded that price plays a major role in the Decision making power of purchase of engine oil. Around 21% auto drivers prefer usage of Complementary gift items with the package of engine oil. So, company should use gift items to increase the perceived value of its Engine Oil. Servo GEO can use this as an opportunity to increase its market share by offering gift items & also promotes its brand quality parameters by various Media channels discussed on back page.

6) GIFT PREFERENCES
A survey was conducted in this regard to check out gift preference by the auto drivers. The results are as follows:-

Findings
From the gift choice survey it is clearly stated that auto drivers does not have any preference for a particular gift item. They just want a family gift item with the pack of engine oil.

Conclusion

As one can see from the Social Demographics that all drivers are having a family with 4-6 family members. Also, the answers obtained from the drivers correspond to the fact that drivers want a gift item which can be consumed in the family. About 55% of auto drivers confirm this fact. About 23% of auto drivers like to have toothpaste as a complimentary gift item. This particular choice can be due to reason that many brands (like MAK GE) are already distributing this as a gift item. Around 11% like to have soap as a gift item which is again a family consumable item.

7) Knowledge About Servo Brand

The survey was conducted to know the perception of auto drivers about Servo Geo. For this survey, a series of questions were asked from the auto drivers. The first question consists of knowledge about the packaging material used for Servo Geo (either it is 1lt packet or 1lt bottle). The findings & conclusions are as follows:-

Findings
The above chart clearly states the fact that there are around 75% of auto drivers who know about the use of plastic bottle by the Servo Brand. This shows that a fair amount of people have got knowledge about the packaging style by Servo. But a significant number of 25% auto drivers does not know about the packaging style of servo brand which indirectly states that these much % of auto drivers are the opportunity market of Servo.

8) Packaging Color Knowledge (or appeal of package color)

The Second question in the series to know about the brand knowledge of Servo Geo was by asking the package Color of Servo Geo. This question was asked to know a person share of mind & share of heart about Servo Geo. This test was done only on those drivers who are having knowledge about the package of Servo brand (question discussed above).

Findings
The above chart clearly shows that the percentage of auto drivers who are aware of packaging color of Servo Geo is less than 50%.

Conclusions

This clearly indicates that the drivers are not able to recall the packaging color. So the packaging color of Servo Geo is not effective as compared to other brand of engine oil.

9) % Percepeption About Servo Brand

Perception about Servo products. This analysis was done with the help of a question & the results are as follows:-

Findings & Conclusion

The above chart clearly states the fact that more than 50% of auto drivers do not buy Servo lubricants mainly because of its high price. So the high price is proving out to be a major challenge for Servo.

CNG Taxi Survey

1) % MARKET SHARE
The first question in the questionnaire was about the engine oil used in the taxis. The findings of the survey are as follows:

Conclusion
So from the above pie chart we conclude that Castrol & Servo are the leading Brands in Taxi category with a cumulative market share of around 87%.

Findings
The above pie chart explains the market share of engine oil in taxi segment. As one can clearly see that the Castrol is the market leader in

this segment with a market size of more than 50%. Also Servo holds to be nearest competitor of Castrol with a market size of 32%. MAK GE which is the market leader in the auto segment seems to be quite weak in this segment with a market size of just 2%. The lube brands holds the remaining 11% market.

2) FACTORS INFLUENCING THE BUYING DECISION

The chart below is derived from the second question. The second question talks about the brand wise selection factors for buying engine oil. In the conclusion part the factor wise preference order is given. The Conclusion part is given below:-

Findings
The above pie chart shows that the around 90% market of taxi segment is being influenced by the quality parameter.

Conclusion
Quality becomes an important criteria or factor which leads to purchase of engine oil. The above result also signals to one of the fact that taxi owners are very particular about the quality parameter of engine oil. For them the oil should be good irrespective of price & thats why Castrol is enjoying number one position. This also states the fact that taxi owners are financially well off as compared to auto drivers. The remaining market is being influenced by the cheapness of engine oil. But that parameter is quite weak & if companies just cover this factor only (price factor) then it wont be able to win the market share of CNG taxi segment.

3) % Percepeption About Servo Brand

Another point to analyze the quality variability is by asking the taxi owners perception about Servo products. This analysis was done with the help of a question & the results are as follows:-

Findings & Conclusion

The above chart clearly states the fact that 25% of Taxi owners do not buy Servo lubricants mainly because of its low quality. So the quality variability is proving out to be a major challenge for Servo.

4) % OFFER SELECTION
The perception about the price can be change by using these three factors:

Discount More quantity in same price Complimentary Gift items Anything in these three offers

The above chart clearly shows that around 34 % people need discount in the engine oil. Around 30% of people want extra oil with the same package of oil. As the owners are having many vehicles so they want to have more oil. The third option could be by giving complimentary gift items to taxi drivers. An important point to be noted here is that no taxi driver will ever go for a gift item by cornering quality variable.

5) % GIFT CHOICE
A question in the survey was asked to figure out the liking of a particular type of gift by the taxi owners. The findings & recommendation of the survey are as follows:

Findings
From the gift choice survey it is clearly stated that taxi drivers does not have any preference for a particular gift item. They just want a family gift item with the pack of engine oil.

6) MARKET KNOWLEDGE ABOUT THE COMPLIMERNTRY GIFT ITEMS

A question in the questionnaire was asked to know the awareness of taxi drivers about the gift items given with a brand of oil. The findings of the survey are as follows:

Findings
The above chart shows that about 91% of taxi owners are unaware of any gift item schemes which are prevailing in the market.

Conclusions

The above result shows that the taxi owners are quite loyal to the brand which they purchase. If no scheme is coming in their preferred brand, then they wont ask for any oil with scheme. The above result also shows that the companies are not properly promoting their gift item scheme. The above result also proves a point that taxi drivers are very particular for the quality of oil and are well off financially. Hence they wont care for any gift item schemes.

Shopkeeper Survey
1) Package usage for auto drivers
The first question in the questionnaire for shopkeepers was to know the package usage by the auto drivers. The findings & conclusion are as follows:-

Findings

The above chart shows that a maximum number of auto drivers (nearly about 60%) purchase a 1 lt packet whenever they buy engine oil. Nearly 25 % of auto drivers rely on half lt packet for purchase & remaining 15 % of auto drivers go for an open purchase of oil.

Conclusion
The above table clearly confirms the fact which was pointed in auto driver survey regarding the purchase of 1 lt lube oil packet. There also it was shown that auto drivers are mainly inclined towards the purchase of 1 lt lube oil.

2) Package usage for Taxi drivers

The second question in the questionnaire for shopkeepers was to know the package usage by the taxi drivers. The findings & conclusion are as follows:-

Findings

The above chart shows that a maximum number of taxi drivers (nearly about 60%) purchase a 3 lt packet whenever they buy engine oil. Nearly 30 % of taxi drivers rely on 1 lt packet for purchase & remaining 10 % of auto drivers go for an open purchase of oil.

Conclusion

The above table clearly states the fact that the major choice of a taxi owner is to purchase a packet of 3 lt lube oil.

3) FACTORS INFLUENCING BUYING DECISION OF DRIVERS

The third question in the questionnaire was to analyze the influence of shopkeepers on drivers in the decision making power for a particular brand.

Findings
The above table shows that the shopkeeper sometimes (around 40%) plays a key role in influencing the drivers to buy a particular brand.

Conclusion
The results from the above table conclude the fact that shopkeepers do mention the name of a particular brand .The mention of a particular brand is because of the following reasons:

The shopkeepers get a good margin on the sale of that particular brand oil. The shopkeeper has got a high perceive value (high quality) for that particular brand oil as compared to the other brand of oil. They offer their advice on seeing the financial status & interest of their customer (it means they check out if the consumer is looking for a cheap oil or oil having a gift items with it).

4) SELECTION FROM THESE OFFERS

The other recommendation is to influence the drivers by promoting the engine oil with Discount, Gift items & extra oil. The survey is done regarding this method to know what shopkeepers think a driver need during purchase of engine oil. The table of survey is as follows: -

Findings

Around 60% of shopkeepers believe that the drivers need discount while buying engine oil. There are 20 % shopkeepers who believe that the drivers are looking for gift items with the engine oil. Only 5 % believe that the drivers need extra oil with a 1 lt or 3 lt package. Remaining 20 % said that offers can be made in any of these two forms.

5) GIFT CHOICE
The last question of the questionnaire was to know the perception of shopkeepers about the liking of any particular gift item by the auto & taxi drivers. The findings & conclusion part of the survey are as follows:-

Findings

The above table states that around 40 % of shopkeepers believe that drivers would love to get toothpaste as a complimentary gift item. Another equal % of shopkeepers said that the drivers would like to get soap as a gift item. The remaining 15 % of shopkeepers recommend the use of beauty cream for family as a gift item. Near about 10 % believe in giving hair oil as a gift item.

Conclusion
The above % preference of gift items clearly confirms the fact that the gift items selected by shopkeepers are for family usage. So, we can clearly conclude the fact that the shopkeepers also believe that drivers are influenced by gift items which is for the usage of whole family.

CHAPTER- 5

CONCLUSION

MAJOR FINDINGS
A) Auto Rickshaws
All these major brands (MAK GE, BP, Castrol & Valvoline) constitute around 90 % of market. The remaining market is hold by the other small companies with an exception of a Big company called INDIAN OIL which market SERVO Geo in this segment & has only about 6% market share. Price plays a major factor in the buying decisions of lubricants. It contributes about 15% in the decision making power of drivers while buying engine oil. Also it is clear that around 20% of auto drivers do

not buy Servo due the high price of it. The quality dimension contributes about 50% of total selection criteria to buy a particular engine oil.

A)

Taxi Owners
The market share of engine oil in taxi segment. As one can clearly see that the Castrol is the market leader in this segment with a market size of more than 50%. Also Servo holds to be nearest competitor of Castrol with a market size of 31%. Around 90% market of taxi segment is being influenced by the quality parameter. Around 14% people buy engine oil on seeing the cost of it. So, cost is also one of the factors which can influence the buying behavior of engine oil.

A)

Shopkeepers
Shopkeeper sometimes (around 40%) plays a key role in influencing the drivers to buy a particular brand. There are 20 % shopkeepers who believe that the drivers are looking for gift items with the engine oil.

RECOMMENDATIONS
A)

Auto Rickshaws

Servo has to position itself in such a way that its price value should look fully justified (for ex: Castrol charges high rate & boost itself as the best CNG oil in the markets so, it's perceive value is high & consumer dont mind paying such a high price). So proper positioning of price of Engine Oil is needed to target mass market. Servo should create a buzz in the auto drivers about its brand, so that they can talk about it at their common meeting point like tea stalls. The buzz can be created by the use of the advertisement on radio about the undisclosed new gift items coming along with Servo CNG oil. Announcement of bumper prize on the sale of lube oil which can be worth of 1 lakh Rs or more & discount on the buying of Servo Geo oil. Servo should ensure quality products reaching its users. This can be done by putting up Rs 5 coin inside the bottle of engine oil as a gift for the buyers. It will help the company in two ways. First it will add as an attractive offer for buyers & secondly it will reduce the black marketing & duplicity of Servo.

A)

Taxi Owners
Right now Servo is the biggest challenger of Castrol. Servo has got the opportunity to win over the market share of Castrol by providing engine oil to taxi owners at par quality & relatively less price as compared to Castrol. This can be done by launching a separate engine oil for the taxi Segment. Castrol has launched BP at a relatively lower price to capture the market of auto Segment because it knows that the auto drivers are not able to afford such expensive oil.

The perception about the price can be change by using these three factors:-


A)

Discount. Complimentary Gift items. Extra Engine oil.

Shopkeepers
Free gift with every pack such as key rings, t-shirts, caps. Etc. it will attract customer. Schemes for shopkeepers [yearly gifts as to quantity of Servo products sold].

APPENDIX