INDUSTRY GUIDE Mr.

Naveen Gulati
SRSM IOCL, New Delhi

PROJECT REPORT

PROJECT TITLE:
To Study the various factors affecting the buying behavior of CNG Engine Oil in Delhi & to formulate Schemes/Recommendations to improve Sales of Servo Geo.

PROJECT GUIDE Prof. V.Sekhar

Alliance Business School (Bangalore)

SUBMITTED BY Gaurav Bajaj (08PG303)

Alliance Business School, Bangalore 1|Page

Post Graduate Program

Post Graduate Diploma in Management: 2008-10 Term IV: Industry Internship Program (IIP)

Declaration
This is to declare that the Report entitled To Study the various factors affect ing the buying behavior of Gas Engine Oil in Delhi & to formulate schemes/recommendations to improve sales of Servo Geo has been made for the partial fulfillment of the Course: Industry Internship Program (IIP) in Term IV (Batch: 2008-2010) by me at Indian Oil Corporation Ltd. under the guidance of Prof. V.Sekhar I confirm that this Report truly represents my work undertaken as a part of my Industry Internship Program (IIP). This work is not a replication of work done previously by any other person. I also confirm that the contents of the report and the views contained therein have been discussed and deliberated with the Faculty Guide.

Signature of the Student Name of the Student Registration No : GAURAV BAJAJ

: 08PG 303

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Post Graduate Program in Management

Certificate
This is to certify that Mr. Gaurav Bajaj Reg. No. 08PG303 has completed the Report entitled To Study the various factors affecting the buying behavior of Gas Engine Oil in Delhi & to formulate schemes/recommendations to improve sales of Servo Geo Under my guidance for the partial fulfillment of the Course: Industry Internship Program (IIP) in Term IV of the Post Graduate Program in Management (Batch: 2008 20010).

Signature of Faculty Guide

Prof. V.Sekhar (Name of the Faculty Guide)

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Index
TOPICS Chapter 1- Acknowledgement Chapter 2 INTRODUCTION
a) Need for the research b) Research problem c) Research objective 12. 12. 12.

Page No
9.

Chapter 3 AN INSIGHT INTO THE RESEARCH

a) Scope of the Study b) Research Methodology c) Type of research d) Sources and Tools of Data Collection e) Sampling Techniques f) Sample Size & Limitation of Research work 15. 15. 15. 16. 16. 16.

Chapter 4 The Indian Lubricant Market

a) Introduction b) Lube oil after Post Liberalization c) Market Size 18. 18. 19. 21.

Chapter 5 Growth of Delhi Transport Chapter 6 Growth of CNG Vehicles

23 .

Chapter 7 Contamination of Engine oil

27.

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Chapter 8 Major Brands in Indian CNG Market & their Physical Properties Chapter 9 Educational Background Chapter 10 Economic Background Chapter 11 Primary Research on Auto Drivers
a) Ownership of Autos

30.

34. 37.

41.

b) % Market Share of Autos

42.

c) Ownership vs. Product Usage

44.

d) Brand Image & its Selection Factors

45.

e) Factors influencing Buying Decision

1) Quality Variable 2) Mechanic Selection 3) Price Factor 4) Word Of mouth

f) Package usage in Lube Oil

47. 50. 52. 53. 54.

g) % Gift Item h) Knowledge about Servo Brand i) Packaging color Knowledge j) Age wise Brand usage in Market

57. 58. 59. 61.

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Chapter 12 Primary Research on Taxi Owners

a) % Market Share of Autos b) Brand Image & its Selection Factors c) Factors influencing Buying Decision
1) Quality Variable 2) Price Factor

64. 65.

d) % Gift Item e) Knowledge about Servo Brand

f) Market Knowledge about the Gift Item

67. 69. 73. 74. 76.

Chapter 13 Primary Research on Shopkeeper

a) Random Shopkeeper Survey b) Package usage for Auto Drivers c) Package usage for Taxi Owners d) Factors influencing Buying Decision e) Selection from the offers:1) Discount 2) Complementary Gifts 3) Extra Oil f) % Gift Item 88. 80. 82. 83. 84. 86.

Chapter 14 Primary Research on Mechanic

a) Top Engine Oil for Mechanic b) Reasons for the Perception c) Factors influencing Buying Decision d) % Perception about Servo Brand 91. 93. 95. 97.

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Chapter 15 Appendix
Annexure 1 Annexure 2 Annexure 3 Annexure 4 Annexure 5 101. 102. 103. 104. 105. 106.

Chapter 16 Bibliography

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Acknowledgment
First of all I would like to thank my Industry Guide (Mr.Naveen Gulati ) who has helped me a lot in the formation of this project. He was always a constant source of inspiration during all the time of project. His valuable feedbacks, guidance & motivation helped me to accomplish my task. Secondly I would like to thank my Project Guide (Prof.V.Shekar ) on the completion of my project. He motivated me throughout my project & always gives useful feedback whenever I felt short of ideas. Thirdly I would like to thanks my Parents for providing me with constant motivation during my whole project tenure. In the end but not the least I would like to thank each person individually who has devoted their valuable time in the completion of my survey data sheet.

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Executive Summary
The project title was To analyze the factors affecting the buying decision of CNG Engine Oil & thus to recommend on those factors to increase Sales of Servo Geo. The research work was divided into two phases for reporting & analyzing the factors respectively. Each phase is being described as follows:-

Phase 1
Phase 1 was the starting point of research work & its duration was about 2 weeks. Before going out for primary research work, I studied the CNG lube oil industry with the help of internet & collected some useful insight about the industry. In the primary research work, I first of all decided on the different category of persons (stakeholders) who are linked with the engine oil. These persons/stakeholders were as follows:1) 2) 3) 4) Auto Drivers Taxi Owners Shopkeepers selling engine oil Mechanic Personnel

Then I had carried an exploratory survey for each stakeholder without drawing any questionnaire. This random sample helps me to understand the various factors affecting the buying decision of engine oil. But the information which I get was quite raw & hence I moved on to the second phase for a systematic review of the enlisted factors gathered from the exploratory survey.

Phase 2
After understanding the enlisted factors, I formed the questionnaire, covering each & every aspect about buying behavior of engine oil. I form different questionnaire for all stake holders from the point of view of that segment of people. The sample data collection from all the stakeholders had taken duration of around 5 weeks. In the first week I covered the auto rickshaws drivers. I had taken a sample of 150 auto drivers from all the major part of Delhi. In the second week I covered the survey of Taxi owners which constitutes a sample of 119 people. The third week was devoted to cover the shopkeepers. In the fourth weak I covered the mechanic personnel. I also covered a survey on the social & economic demographics of the life style of drivers. From this survey I try to figure out the relationship between the buying behavior of drivers & their educational & economic background. This survey was covered in the fifth week. The remaining days of my research work were used to draft out the studied factors on the word file & give it the shape of a project report. The overall expenditure from the starting day of research & upto the end day of submission of report was in between Rs 4000-4500.

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Brief Analysis of Report

Overall from the given feedback & analysis it can be clearly stated the fact that the Quality is the top most factor which is affecting the buying decision of CNG Lube oil. Hence in order to increase the sales we have to increase the perceived value in the minds of consumers about the Quality parameter of Servo Geo. The quality variable perception can be increase by checking the duplication of oil in the distribution channel. Moreover by using proper communication channels the quality variable factor can be properly promoted across the consumers & hence will build trust in the minds of consumers about the quality of Servo Geo (like Castrol is doing in its advertisement). The other factor which is affecting the buying decision of lube oil is the price of a particular brand. The brand has to justify the price structure to its users. So, in order to increase the perceive value of Servo Geo the company can offer discounts or complimentary gift items along with the bottle of lube oil. The majority of consumers like discount with the oil as compared to the gift items. So the company should make proper manipulation in its price structure to satisfy the perceived value to its customers. The other major factor which is affecting the buying decision of lube oil is the mechanic variable. Mechanics help a lay man to judge good quality oil. So many users buy oil on the recommendation of Mechanics purchase a given brand of oil. So the company should try to develop a good perceive value in the minds of mechanics. The last variable which is also important in the buying decision of lube oil is the recommendation from the shopkeepers & fellow friends (Word of Mouth). The Company should properly promote its Lube oil in order to create a buzz about the Servo Geo in the market & also to improve the perceived value in the minds of shopkeepers. The methods to increase the perceive value of Servo Geo in the minds of consumers is discussed inside the report.

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Introduction
Need for the research
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% .In early 90s a new type of fuel called CNG hit the Delhi road, & hence Servo came out with new engine oil called Servo Geo. Even after so many years of its launch & with such an old brand name, Servo Geo was not even able to capture 10 % of market in CNG Lube engine oil. 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 of Servo Geo.

Research Problem
The research problem was to analyze the failure of Servo Geo. 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 Gas Engine Oil in Delhi & to formulate schemes/recommendations to improve sales of Servo Geo.

Research Objective
To understand the Lube industry (mainly CNG engine oil market of Delhi) from the Secondary Research. To analyze all the important properties & contaminants of CNG engine oil. To carryout comparative analysis of all the major brands of CNG engine oil To undertake exploratory survey of Gas Engine Oil market of Delhi with the help of three wheeler Auto rickshaw drivers, Taxi owners, shopkeepers selling engine oil & vehicle mechanics.

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 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 the Economic Demographics of the auto & taxi drivers by using questionnaire. To analyze all the survey data & formulate recommendations based on it.

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An Insight into the Research

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

Research Methodology
This research work is done to first find out the factors which affect the buying decision of engine oil & secondly on the basis of survey analysis, formulate recommendations to improve sales of Servo Geo.

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 Gas 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 in Hindi 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 gas engine oil mentioned on the internet. The sources of all the sites are mentioned in bibliography & under the subscript where ever it is used in this report.

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Sampling Techniques
Random sampling technique has been used, as the respondents are scattered all over the Delhi region & the population of respondents are homogeneous in nature.

Sample Size
There were 5 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 150 Auto drivers. 2) Taxi Owners: - The sample size for this survey was 119 Taxi drivers. 3) Shopkeepers: - The sample size for this survey was 20 shopkeepers. 4) Mechanic: The sample size for this survey was 30 mechanic personnel.

Limitation of the Research

There were few limitations in this research work. The sample covers all the major portions of Delhi, but still it was not able to cover the full width of Delhi. 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 CNG engine oil, available on internet is not sufficient. There is no where mentioning of % wise market share of CNG engine oil in Delhi. 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.

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The Indian Lubricant Market

Introduction
The Indian automotive lubricant market is the sixth largest market in the world with revenues of approximately $1.30 billion in 2002. 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 medium to long term, Frost & Sullivan expects private sector companies to have a market share of around 25 percent. 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 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.

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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 2006 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 3% in 2006-07.

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Growth of Delhi Transport

There were about 2.1 Million vehicles which were moving on the roads of Delhi in the year 1993 & which grew to 3.6 Million by 2001& rose to 30 million in 2008.The number of licensee vehicles added to the Delhi roads has increased 10 fold from 2000 to 2008. This shows that the Indian transportation industry is continuously growing in nature & hence lube oil companies have got a good opportunity to benefit from this rising market.

The following graph illustrates the continuous addition of traffic to Delhis road.

NO. OF VEHICLES

YEAR

3241274 2877910 2524946

2120330

1732592 1379686 1024231 694364 346090 2000 2001 2002 2003 2004 2005 2006 2007 2008

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As one can see from the following graph in previous page, that in year 2000 the number of vehicles on Delhi road was around 300000 & it has increase to around 3000000 in the year 2008. This shows that per year, there has been addition of around 30000 vehicles on Delhi road.(Source: RTO DELHI).

The total number of vehicles in Delhi in 2008 was around to be 6000000.This statistics include both the licensed vehicles of Delhi & the additional vehicles from the neighboring states of Delhi. The following chart tells the division of this figure (6000000) in various vehicles category.

Statistics about number of vehicles as on 15.12.2008

S.No. 1. Two Wheelers (Pvt.)

Category

No. of vehicles

3721185

2.

Four Wheelers (Pvt.)

1805085

3.
4.

Buses (LPV, MPV, HPV)

45858

TSR (Auto Rickshaw)

76040

5. 6. 7.
Total

Taxis

27667

Goods(LGV,MGV,HGV)

158429

Others

31842

5865936

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Growth of CNG Vehicles

The distribution of CNG to vehicles in Delhi is being taken by Indraprastha Gas Ltd. IGL is a joint venture between GAIL (India) limited & Bharat Petroleum Corporation Ltd (BPCL is one of the leading Oil Marketing Company of India). Government of Delhi had a mammoth task of creating the CNG infrastructure in shortest possible time in Delhi.CNG market started operating in Delhi from the year 1999 & since then has increased many fold in past 9 years.

The following chart shows the increase of CNG market in Delhi from 1999-2000 to 2007-08

PARAMETER No of CNG Stations

AS ON

UNIT

2000 2001 68

2001 2002 94

2002 2003 107

2003 2004 120

20042005 134

20052006 146

20062007 153

20072008

As at Nos Year End

163 1.92 5.82 11.99 16.13 16.88 19.08 20.18 20.76 0.48 2.67 5.66 7.72 8.16 8.73 9.42 10.58

(Lakh Compression As at kgs / Capacity Year End day) (Lakh Daily CNG Sale kgs / Average day)

This increase in CNG sale is attributed to the increase in the number of CNG vehicles from 1999 2008 in Delhi. In 1999, the number of CNG vehicles in Delhi was only 3061 .This number has inflated many times in past 9 years & has touched to around 250000 in 2008. There has been around 70 times increase in CNG vehicles in these 9 years which is quite significant.

Inspite of increase in CNG vehicles it contributes only 4% of the total Delhi vehicle population . So, we can estimate that the CNG market is still in growing phase & there is lot of potential to be exploited in this field by the engine oil companies.

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The following chart shows the growth of various categories of CNG Vehicles from 2001 To 2008.

As on As on As on 1st As on 1st As on 1st As on 1st As on 1st As on 1st 1st April- 1st AprilApril-01 April-02 April-03 April-04 April-05 April-06 07 08 400 4231 8874 10199 10480 10941 11552 11665 Buses Auto RTV Others Total 14000 250 11700 26350 35678 2165 15166 57240 49810 4934 15505 79123 59027 5267 16098 90591 62048 5469 16249 94246 65335 5634 24573 106483 68498 5717 47669 133436 80276 5867 130149 227957

This chart shows that in 2008, there are around 12000 Buses, 80000 Autos & around 130000 other vehicles which are running on CNG fuel.

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Contaminations of Engine Oil

There are three basic types of contamination that must be dealt with: "Solid", "Moisture" and "Condition Caused" contamination. The following information will fully explain these types of contamination:

1) Soot and Other Solid Contamination: It is generally recognized, backed by numerous tests and studied over the last 40 years that the contamination generated in an engine is responsible for the majority of "normal wear & is within the 1 - 15 micron range. Also this small solid contamination contributes to accelerating Condition Caused Contaminants such as Oxidation, Nitration, Acid formation and more. Consequently, it is imperative that this contamination be removed from the system as fast as possible. 2) Moisture Contamination: Moisture contamination within the lube oil will cause viscosity increase, VI polymer decrease, TBN decrease, acid formation, accelerated sludge formation, and corrosion of parts. To safely eliminate routine oil drains, one must use additional filtration that utilizes an adsorbent filter media which can remove suspended moisture from the lube oil. 3) Condition Caused Contamination: There are three MAJOR Condition Caused Contaminations that are formed within the lube oil during normal use: Oxidation, Nitration, and Acid. These contaminants are formed when solid and moisture contamination is present, and certain operating conditions exist within the engine. There are three basic types of contamination that must be dealt with: Solid, Moisture and Condition Caused Contamination. The following information will fully explain these types of contamination:-

a) Oxidation: Oxidation occurs when the hydrocarbon constituents (and other products) of lube oil combined chemically with oxygen. Lube oil in engines will combine with available oxygen under certain conditions to form a wide variety of oxidation products. Many of these direct or primary oxidation products combine with other materials such as wear metals, solid contamination, and moisture, to form second and third derivative products. As with most chemical reactions, oil oxidation is accelerated by heat and pressure. Heat in particular will speed up the oxidation process. Various studies have shown that lube oxidation (with many variables such as the type lubricant and additive package in the lubricant) that the oxidation rate can be doubled for every 15 to 20 degrees increase over 180 degrees F. Also, engine load, which will dictate the levels of oxygen and pressure within the engine, can be seen in the form of accelerated acid formation, corrosion, oil thickening, deposit formation, and accelerated wear.

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b) Nitration: The combustion chambers of engines provide one of the few environments where there is sufficient heat and pressure to break the atmospheric nitrogen molecule down to two atoms that can react with oxygen to form nitrous oxides (NOx). When nitrogen oxide products enter the lube oil through normal blow-by, they react with moisture present in the lube and become very acidic and rapidly accelerate the oxidation rate of the oil. Proper By-Pass Filters can control the effects of nitration in the same ways it controls oxidation. By delivering cleaner oil to offer as a seal between the ring and liner, blow-by of NOx components are kept to a minimum. Also, the GCF Filter keeps the oil chemically dry and prevents the mixing of NOx and moisture, which controls NOx acid formation and accelerated oxidation of the oil.

c) Acid Formation: Acids are formed within the lube by several sources. We have already covered two of them in the form of acids formed from oxidation and nitration. In most all forms of fuel for internal combustion engines, trace amounts of sulfur are present. Sulfuric acid is formed within the lube oil when sulfur molecules react with oxygen in the combustion chamber to form sulfur oxides. These sulfur oxides are then blown past the rings and enter the oil. Here the sulfur oxides mix with moisture to form the highly corrosive sulfuric acid. It is next to impossible to remove trace amounts of sulfur from fuels by filtration.

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Major Brands in Indian CNG Lube Market & their Physical Properties
1)

MAK GE: MAK GE 20W-50 is suitable for use in all seasons and helps in reducing oil
consumption. It extends oil life due to its excellent oxidation and nitration resistance. Also it Optimizes ash content, prolongs the life of valves and spark plugs. It keeps piston and engine clean, thus ensuring smooth engine operation. It is compatible with catalytic exhaust system fitted in the vehicle. Superior quality Gas Engine Oil is specially developed for vehicles operating on Compressed Natural Gas (CNG), LPG and Dual Fuel. MAK GE was among the very first entrants in CNG engine oil market. This helps Bharat Petroleum to milk the CNG lube oil market & establish itself as a market leader. It is holding more than 35 % of CNG lube oil market in Delhi. Physical Properties: Grade Name MAK GE 40 MAK GE 20W-50 K.V.@ 100C cst 14.5 20.7 VI 98 120 Flash Point COC,C 232 242 Pour Point C -9 -21

2) BP Vanellus CNG : BP name stands for British Petroleum. It provides excellent wear
protection to engine components operating at extreme temperature .Also it provides lower maintenance cost to the users. It is recommended for lubrication of engines fuelled by CNG/LPG vehicles. BP 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. The company has managed to gain sustainable competitive advantage through: Distinctiveness driven by continuous innovation in all areas of business. Winning culture and a desire to excel Strong meaningful relationships with all stakeholders.

Physical Properties: API CF, SAE 20W50.

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3) CASTROL GTX CNG: Recommended for lubrication of engines fuelled by CNG/LPG under
wide range of loads and driving conditions for on-highway vehicles like autos, taxis and passenger cars. Specially formulated to work in hotter gas engines. Advanced wear protection to engine components operating in hot condition. 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 the name of 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.
Physical Properties: SAE 20W-50 .Meets SAE 20W50 Viscometrics, API SG/CD Performance Standards.

4) Valvoline CNG Special: High performance gas engine oil specially formulated for CNG and
LPG engines to keep the environment clean, dissipates heat & keeps the gas engine cool.

Recommended for cars, taxis, vans, jeeps, RTVs and three wheelers (4-stroke gas engines). Valvoline has successfully completed a decade of its presence in India. The company has established itself as the fastest growing lubricant company in India. Valvoline has set an ambitious revenue growth target for the year 2009 even in very challenging market conditions. The company has taken many new initiatives to increase its share in the highly competitive lubricant market . In a declining market scenario, Valvoline has managed to grow in all its core segments, namely, diesel engine oil, passenger car segment and two-wheeler segment. They have been increasing their market share in all segments. Valvoline Cummins Ltd. is a joint venture between Ashland Inc., USA, and Cummins Sales & Services (India) Ltd., a wholly-owned subsidiary of Cummins India Ltd.

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Valvoline is today the fastest growing lubricant marketer and producer of quality branded automotive/industrial products. The products offered in the Indian market include automotive lubricants, transmission fluids, gear oils, hydraulic lubricants, automotive filters, specialty products, greases and cooling system products. The company clocked a turnover of Rs. 470 crores in 2008. Valvoline has been in India for just over a decade but it has undoubtedly established itself as the fast growing lubricant brand in the market. Currently 14% of its total business comes from Motorcycle oil, 6% comes from passenger car segment and close to 58% comes from diesel engine oil in the aftermarket.

Physical Properties: API SF, SAE 20W50.

5)

SERVO PRIDE GEO: Servo Pride GEO ALT 20W-50 is a high performance low ash gas
engine oils, formulated from high quality mineral oil and select additive system to provide excellent thermal stability and resistance to oxidation and nitration. Servo Pride ALT GEO 20W-50 is recommended for Ashok Leyland commercial vehicles operating under CNG fuel. It has got excellent resistance to oxidation and nitration. Also excellent resistance to corrosion. It gives extra protection for valve guide seats against wear. The SERVO PRIDE GEO is a product from Indian OIL ltd.

Physical Properties: Servo Pride GEO ALT 20W-50 meets the following specifications. Also got CES 20074 of Cummins SAE GRADE Kinematic Viscosity CSt @ 100 C Viscosity Index, Min. Flash point (COC), C Min. Pour Point, C Max. TBN mg KOH/gm 20W-50 17.5 19.5 120 200 (-) 21 5-6

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Educational Background
A study was conducted to determine the educational background of the auto drivers community. The findings & conclusion are as follows:-

Findings
According to data obtained it has been found that 80 % percent of auto drivers are having below Metric level education. More than 20 % auto drivers are totally uneducated & around 60% of the community is below the level of 5th standard. Around 90 % of auto drivers are unaware of the quality standards mention on the package of engine oil.

Conclusion
So, special care is needed in designing any marketing strategy for this Segment. There is a special need to educate the drivers about the quality grades of engine oil, & also how they can keep their auto in a best condition.

The following recommendations will help company by educating the auto drivers about the quality grades of engine oil.

Recommendations
The company can win the loyalty & trust of the auto drivers by launching an IT campaign. In this Campaign the company should first get the mobile numbers of all the auto drivers .In the second phase of this IT compaign, the company should send daily SMS to these drivers, teaching them about the quality standards of oil & other methods of lowering the maintenance cost of their auto. These tips should be in the layman language. This will help the company to win the confidence of auto drivers in two ways. First it will properly strengthen the position of Servo Brand in the minds of consumers. Secondly, it will ensure in the minds of consumers that the Servo brand stands for quality & is working constantly in the favor of auto drivers community.

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 Also, the company can launch a city wise compaign of educating auto drivers. This can be done by putting up educational stalls & giving free quality booklets to auto drivers. The same compaign is being launched by Valvoline in this regard to increase their brand visibility. At the ground level, Valvoline has conducted extensive van campaigns across India. They have done a lot of ground level activity which has helped them to create awareness for their product. They have been running van campaign across India with more than 36 vans running across the length and breadth of the country. These vans are equipped with audio visual devices. These vans educate the drivers about the quality parameters of engine oil. These van campaigns have been very successful for Valvoline in providing visibility for the brand in urban, semi-urban and rural areas. So, we can also take a leaf out of Valvoline strategy in improving our brand image.

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ECONOMIC DEMOGRAPHICS
The survey was conducted to study the financial status of a Delhi based auto driver. For this survey a sample of 90 odd Auto Drivers were selected from various parts of Delhi. They were asked about their financial status. The findings are as follows:-

Findings
According to results obtained, it was figured out that the range in which auto drivers earns is in between 3000 8000 per month depending on various conditions. Only 10 % of auto drivers in Delhi are able to earn around 8000 per month. These are the Auto Drivers who have their own auto vehicles & have no liabilities to repay (liabilities like auto rent & loan interest of auto). More than 80% of Delhi auto drivers are earning only in between 3000 5000 per month This figure varies in between this range .This is due to fact that a considerable amount of their hard earned money goes to owners of auto & in repaying the loan taken to buy autos. According to the survey conducted a rented auto cost in between Rs 200- 400 per day. An old auto is charged for around Rs 200 & for a new auto the owner charges around Rs 400 rent. The average daily earning of auto driver is around Rs 400 500. So, after repaying the rent daily they are left with a mere Rs 150 to 200 respectively. This Rented Segment of auto drivers in Delhi is around to be 45 %. Another category of auto drivers are those who have their own auto vehicles. These auto vehicles have been purchased from external finance. An auto cost around 3.5 lakhs in which 1.5 lakhs is the cost of auto & remaining 2 lakh is the license fee to run on Delhi road which has to be paid to Delhi Govt. The auto drivers in this category have to shell out more than Rs 7500 per month as payment of loan. There are around 30 % of such auto drivers present in the total auto driver market. Also the survey reveals out that on an average, an auto driver has to spend Rs 400-500 per month on engine oil.

Conclusions
So overall, the total auto driver markets are under tremendous financial pressure from all corners. They also complained of being harassed mentally & financially by the traffic Cops. This is an interesting fact to be considered by the company officials while deciding on the price of engine oil. The auto drivers want engine oil to be of a good quality and that too at a cheaper price, so that he can save his earnings on engine oil.

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Primary Research Work on Auto Drivers

The primary research work was done on a group of auto drivers to understand the perceived value of different brands, factors affecting the buying behavior of engine oil & overall market of CNG engine oil. The sample used for this research work was about 150 auto drivers & the overall results derived are having a variation of 6 % (which means that the result can have an error in between 6 %) This sample was taken randomly from all the major areas of Delhi which include Uttam Nagar Bus terminal, Hari Nagar Depot, New Delhi Railway Station, Old Delhi Railway Station, ISBT, Nizammudin Station, Major Indraprastha Gas Stations & almost all Metro Stations. A questionnaire was designed consisting of 12 questions (Given in Appendix 1) to understand the overall Market variables mentioned above. The Survey on auto drivers has taken a time span of 1 week (11/5/08 to 17/5/08). The Overall findings, conclusion & recommendations are mentioned in the next page.

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CNG AUTO SURVEY

1) OWNERSHIP OF AUTOS
The first question is asking the auto drivers about the ownership of their auto vehicles. The findings are shown below:-

% OWNERSHIP OF AUTOS
Self Owned Rented

47% 53%

Findings
The above chart shows that in Delhi there are around equal % of both self owned auto drivers & 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.

*Detail given in Economic Demographics

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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:-

% MARKET SHARE
CASTROL VALVOLINE MAK GE BP SERVO Others

6%

4%

14%

19%

15%

42%

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.

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Conclusions
From, the Secondary data, we derive out the fact that MAK GE was the very first entrant in the CNG engine oil market. It capitalizes this opportunity by setting up a tie with IGl (Indraprastha gas ltd.) to market CNG in Delhi. So, MAK has got a major share of Heart & share of Mind in the Auto Drivers. Once MAK holds the major chunk of CNG Engine Oil market .But after the liberalization* & entry of other international Brands this share has shrink to 40%. The other leading Brands in this category includes BP & Castrol which belongs to same company (British Petroleum) & hold around 33% CNG oil market of Delhi. The other major brand is Valvoline which hold around 15 % market share.

*For Details see chapter on Indian Lube Industry

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3) OWNERSHIP VS PRODUCT USAGE

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

% Self Owned Auto

% Rented Auto

44

20 13 15 17 14 39 1 10 19 6 3

Castrol

Valvoline

Mak Ge

Servo

BP

Others

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.

Conclusion
The chart gives a very clear picture that there is not much difference in the choice of a specific brand of oil by the two categories of auto drivers. This result shows that out of the given 6 % market of Servo Brand, the self owned vehicle owners have got more positive perceived value & trust for Servo Brand as compared to rented Auto Driver.

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4) Brand image & Selection Factors for Buying Lube Oil

The third questions consist of the factors affecting the buying decision of a particular brand. For this question there were four factors which were analyzed .The factors are as follows:Cheap Price of Engine Oil Good Quality of Oil Mechanic Selection Friends using it (Word Of Mouth) These factors are analyzed for all the major brands .The result shows the perceived value of auto drivers for all the given Brands. The result of all the major brands & their perceived factors are analysed below:-

Brand image & Selection Factors for Buying Lube Oil

PRODUCT BRAND CASTROL % users 34.78 VALVOLINE % users 18.75 MAK GE % users 0 BP % users 0 SERVO % users 50 OTHERS % users 0 50 0 66.67 33.33 0 44.83 51.72 3.45 43.55 33.87 3.23 47.83 13.04 4.35 Cheap Price 0 Quality 76.19 Mechanic Selection 25 Word of Mouth 0

So, quality dimension is the top most criteria in each brand selection. Hence, the company should put extra effort to ensure good quality of oil reaching its consumers.

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5) FACTORS INFLUENCING THE BUYING DECISION

The chart below is derived from the third question. The question discussed before this analysis (3rd quest) 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.

% VARIOUS FACTORS
QUALITY PRICE MECHANIC SUGGESTION WORD OF MOUTH

49

33

15

3 FACTORS INFLUENCING THE BUYING DECISION

In this chart, the factor wise preference order is given. This chart explains the factors which drivers consider in his mind while going for purchase of engine oil. The findings, Conclusion & recommendation part of each factor will be done individually in the next page.

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1) Quality variable
Findings
The above chart shows that the major factor which auto drivers look into while buying engine oil is the quality & durability of oil. The quality dimension contributes about 50% of total selection criteria to buy a particular engine oil.

Conclusion
So the company should ensure to provide best quality engine oil to its consumers. One of the major factors to be discussed here is of duplication of oil in the market. All the engine oil are sold at various rates in the market. So, it is being assumed that the oil which is having the major variation of price in a given market is coming with duplicate quality. There is a table which shows the % variation of price of 1 lt CNG oil in the market. This table talks about the maximum & minimum price of 1 lt oil available for a particular brand in shops. This table will help in discussing duplicity of engine oil.

VARIOUS PRICE OF 1 LT LUBE OIL PREVAILING IN THE MARKET

The above table shows the range of price of 1Lt lube oil which is prevailing in the market (as told by the auto drivers). MINIMUM PRICE 120 90 110 110 90 MAXIMUM PRICE 200 150 140 130 190 Std. Deviation () 28.50 18.34 11.10 6.17 29.69 % Variation 17.70 15.67 9.41 5.10 21.67

PRODUCT CASTROL VALVOLINE MAK GE BP SERVO

DIFFERENCE 80 60 30 20 100

Average Price () 161 117 118 121 137

The above table shows the range of price of 1Lt lube oil which is prevailing in the market (as told by the auto drivers). The above table clearly points out the fact that the % variation in the price of MAK GE & BP is quite low.

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 This states the point that the duplicity of oil is quite less in these two brands. It is assumed out the fact that the variation in the price of oil will be more when there will be addition of low quality oil in the original brand oil. Also Castrol & Valvoline is also having a low margin of variation difference in their price range. One point to be mentioned out in this table is the fact that the variation in Servo Brand is quite high & is around to be 22%, which clearly states that there is large duplicity or black marketing of Servo engine oil in the market. Once the consumer sees so much variation in the price of particular brand oil, then it creates a state of confusion in his mind & also lowers the quality perception about that particular brand. This fact can be clearly linked to the drivers Perception about Servo Brand*.So one of the biggest factors which is affecting the sale of Servo Brand in the market is the quality parameter. Hence another point to analyze the quality variability is by asking the auto drivers perception about Servo Geo. The results obtained are as follows:-

% Percepeption About Servo Brand

39

23 19 19

Good Quality

Low Quality

Costly

No Idea

The above table clearly states the fact that around 23% of auto drivers do not buy Servo Geo due to its bad quality. This perception of bad quality of oil is due to duplicity of Servo oil in the market. This low quality perception is quite a big factor which is hindering the sales of Servo Geo.

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The following recommendations will help to sort out the problem of this duplicity.

Recommendation
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. The duplicity marketers have to add Rs 5 to their duplicate bottle of Servo to sell in the market. This will lower their profit margin & hence the attractiveness of selling duplicate Servo will be lost in them. This will ensure quality products of Servo reaching consumers & ensure happy & satisfied customers. There is a gap in the Distribution channel which is affecting the quality of engine oil & the company should work out to remove the loop hole in the Distribution system of Engine Oil. The company should clearly monitor the quality of its engine oil in its distribution channel to enhance the trust of the auto drivers. The flow chart of Current Distribution system is as follows:

Base oil prepared at Haldia Refinery

Blending of Base Oil done in Faridabad

Filling of Oil inside the Bottle at Delhi Site

Transfer of oil to 6 Distributors in Delhi

Distribution of oil to all shops in Delhi

The flow chart of Current Distribution system is having one major flaw. The company distributes all its oil to only 6 distributors in Delhi. This shows that all the distribution is ultimately controlled by these 6 distributors. This mechanism is leading to a state of monopoly or a state of Cartel which is needed to be stopped or controlled. This system is the root cause of variation in the quality of oil, as flow of oil is regulated by few people only. So, the company should adopt a more decentralized way of distribution of its engine oil. It should divide Delhi into 16 equal parts & then select a distributor for each part. This will help in controlling the actions of distributors in a much better manner. Also the distributors should be changed within the 6 months. The variation of quality of oil will drop with the fall of monopoly of fixed distributors.
*For further detail see report on perception about servo brand

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2) Mechanic Selection
The other major factor which is effecting the selection of a particular brand of oil is that of Mechanic Selection. The factors which develop the perception of a particular brand in the mind of mechanic will be discussed later. The mechanics are those people who do all the servicing of engine oil in auto vehicles & generally recommends auto Driver to use a particular brand.

Recommendations
From the Social Demographics, it is cleared that 90 % of auto drivers are uneducated & unaware about the quality standard of engine oil*. So, it is by the recommendations & words of these mechanics they adopt the general perception about a particular brand. Therefore the company should work towards developing a positive brand image in the minds of mechanic & also pursue them to use & recommend Servo Brand to the auto drivers. Servo can take a leaf from the experiments of Valvoline which help ed them to build a strong brand image in the mind of mechanic. Valvoline has been conducting training programs for mechanics across the country. Typically, the company identifies roadside garages which have the potential to improve and provide them training on the latest technology engines and aggregates. This has helped build a certain loyalty factor for the brand with the mechanics. The company has till date covered over 350 mechanics all over the country. The same mechanism can be followed by the Servo Brand. It can ensure day camp training to the mechanics in Delhi who is having roadside garages & tell them about the latest technology equipments. Educate them also about the quality parameter which Servo is following to keep the engine fit & working. Also discuss & ask for recommendations from them for the reasons of fail out of Servo in the CNG market .This policy will help in three ways .: First the imparting of knowledge in training Session will build a layer of trust between the company & the mechanic community who is in direct touch of auto drivers. So, indirectly its a series of confidence formation between the company & users. Secondly the seeking of advice from the mechanics will increase their self actualization. (Hinesburg Five Needs Theory). They will feel themselves important & will feel themselves as a part of Servo Brand. So they will themselves involve in this mission to move Servo Brand on top. Thirdly the Servo Company can work out on the points which are mentioned by the mechanic. The company can do research work on these advice & if found significant can implement the ideas to increase the sales of its engine oil.

*for Details on Educational Background see Social Demographic.

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3) Price factor
Price plays a major factor in the buying decisions of Gas Engine Oil. It contributes about 15% in the decision making power of drivers while buying CNG oil. Also from the perception chart it is clear that around 20% of auto drivers do not buy Servo due the high price of it. As the 70% of auto drivers just earn around 3000-5000 per month*, so by this sense the price factor becomes a major phenomenon in the buying decision of Auto drivers. Valvoline has captured a major market in CNG oil only by playing the trump of low price factor.

Recommendations
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, its 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 boost its image by the help of mass media (liker local Hindi Newspaper, Radio FM, Road promotion campaign, paper pamphlets etc) about its quality factors. This will develop a good image about the Servo Geo & also justifies its price label. So, by the use of this method & various other methods Servo can increase its sale & remove the hindrance of high price tag from it brand. The other course of action could be the fact that, if the Company can make some small changes in the distribution channel & save the money over there & then pass on these savings to the needy consumers in the form of Discount or cash coupons. There can be change in the price structure of Servo Geo which can be useful to lower the price of CNG oil. The Indian Oil Ltd. can pass on some of the profit margin from its other products to reduce the price of its CNG engine oil. The above fact can be justified from the primary research done on the offers liked by the auto Drivers. 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 on next page .This pie chart will explain the two recommendations perfectly for this particular price factor .
*for Details on Financial Background see Economic Demographics

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SELECTION FROM THESE THREE OFFERS

% OFFER SELECTION
22% DISCOUNT 21% 57%

COMPLIMENTRY GIFTS

ANYTHING IN THESE TWO OFFERS

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. So, the company should develop & use all possible options to reduce the price range of it oil. One of recommendations is to work on Distribution channel to lower the price & other one is to divert the profit margin from other Line of Products of Indian Oil to cut the cost of its CNG engine oil *. An effective way of giving discount will be to seal 5 Rs coin inside the packet of 1 Lt ,so that the discount given by the company can be directly pass on to the consumers**. 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***. All these two factors can be used to make the price range of Servo look valid to the auto drivers. Hence, by implementing these recommendations the Servo market share wont be loss because of cost factor to other brands. So company can insulate itself from this factor by the above given ideas.

*, ***see details on back page, ** see detail on page number 63

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4) Word of Mouth
The word of mouth (fellow friends using it) is also one of factors affecting the buying decision of lube oil by the auto drivers. Although it is having a very low percentage as a factor in buying decision making power as compared to other factors. Still it can use it as an opportunity by Servo to increase its market share. Around 31% of people have got no idea about the Servo Geo & hence are not using Servo. So, this fact points towards a clear opportunity market for Servo*. The following recommendations are useful in winning this market

Recommendation
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. Also the Buzz can be made by announcing the daily gift winner on radio from a special serial number marked on the back of its bottle cap of lube oil. Also keep in mind to change the gift on a regular basis to create interest in the minds of consumers. This will create a curiosity in the minds of auto drivers to know about the next winner. For this purpose they will talk about Servo brand & it will help in the formation of share of heart & share of mind in the users which will ultimately help in increasing the sale of Servo Geo. A second method to create buzz & to increase market size is by the use of announcing lucky winners by Servo on radio channels. The company can take the auto drivers data from RTO office & then randomly select 1 lucky winner daily (show should be on weekend) & announce it on radio. The winner can be a given a silver coin of Servo along with free 1 lt of servo brand oil. He should be then called in the radio station in the show & given prize & over there discussed about his likings & hobbies. So, at the end of show, the next winner name will be announced. This all will create excitement & curiosity in the auto drivers & they will talk more about Servo Brand. The company can take the help of CSR (corporate Social responsibility) in forming the brand awareness about Servo Geo. The company can take the service of some renowned NGO in this CSR activity. The Company can ask these NGO to organize the summer camps or workshops for the auto drivers children. This will create a positive image of company in the minds of its end users & help in establishing a long lasting impression in their minds.

*See detail chart on perception about Servo Geo

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6) PACKAGE USAGE IN LUBE OIL

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

PACKAGE OPTION
OPEN 1/2 LT 1 LT 13% 7%

80%

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.

Recommendation
Valvoline has used this fact, as a key strategy to distinguish itself from the other major brands. Valvoline launched its 1 lt of package in the form of poly bag with a very stylish opening format. Valvoline is the only major brand which is selling 1 lt lube oil in the form poly bag & other brands are being sold in the form of plastic bottle. Servo can also come up with a new dynamic packet of 1 lt oil which distinguishes itself from the market. This pack should be an eye catcher. So, packaging can also become one of the deciding factors in increasing the sales of Lube Oil. Also MAK GE, BP & Valvoline has launched a complimentary gift Item (toothpaste & toothbrush) with its 1 Lt Bottle of engine oil to promote their respective brands. Servo can also use a strategy to properly market its 1 Lt oil. It can come up with new gift item scheme only with its 1 Lt package. The gift items which can be given with 1 Lt Oil pack are given in the next page.

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

% GIFT CHOICE

55

23 11 6 4 1 SHAVING CREAM ANYTHING

TOOTH PASTE

SOAP

BEAUTY CREAM FOR FAMILY

HAIR OIL

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.

Recommendations
Servo can use the scheme of complimentary Gift items to strengthen its position in CNG oil market. The company can offer from the following schemes: To make an attractive pack of 20 gm toothpaste & Beauty Soap. As both these items are family consumables so it will be really helpful in increasing the sales.

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 The company can give cash discount with the packet of 1 lt oil. This cash discount will be in the form of 5-10 Rs mentioned on the back side of bottle cover. The cash Discount can be varied(For ex :- bottles should have different marking on it like Rs 5 ,Rs 7,Rs 8 & Rs 10).This will ensure curiosity in the minds of drivers about the discount they are going to get in their next purchase. So, it will help in increasing the sale of Servo Brand. Also the company can offer gift of polish as a gift item. This polish can be used to make the auto look new & dashing. But it has the drawback that this gift wont work in long run as the rented auto driver does not want to polish their vehicles. So this gift can be used as a short term innovative prospective. FROOTI can also be used as a complimentary gift item. The reason for the choice of Frooti is that right now there is a season of summer & the drivers are thirsty & exhausted when they came to the shops. So use of Frooti as a gift item will boost the sale of Servo. The only major problem with this scheme is that frooti wont be chilled & also it will lead to a lot of loading cost to the company .For this company should use a coupon on the back of bottle cap. So, that the drivers can exchange this coupon for frooti from any shopkeeper. For this the company should tie up with Frooti Company. It should make a deal that this coupon can be exchanged for a frooti anywhere in Delhi. Another point to keep in mind is that the coupon made should be unique so that it cannot be duplicated. The company can also issue daal & sugar coupons with the Servo Packet. The coupon will have a mention on its cover about the free purchase of kg or 1 kg of sugar from all the leading stores like big bazaar, 360degree, More stores & all other big retail store. This coupon can be fixed on the back of plastic cap. For this scheme to work, the company has to select the leading players in retail market & tie up with them to generate a unique coupon which can be encash with the sugar bag or other gift item mention on that coupon. This gift item can be having various types of Daals name mentioned on it. Also one can put vegetables worth of Rs 15- 20 as a gift coupon which can be bought from the retail shop. This will help company to save the cost of carrying gift item with the engine oil .Also each consumer has got different preferences which a company cant fulfill. But this scheme will help the company to overcome this problem, as sugar & other essential commodities are needed around the year. Also the problem of outdated products will be eradicated with this scheme. The company should issue unique coupons numbers which can be checked with the infrared gun present in the retail shop. This will help in saving the duplication of oil & coupons in market.

This scheme will lead to a big buzz in the market & will promote the Servo Geo brand & hence the sales will increase along with its market size.

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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:-

% Knowledge About Servo Brand

Those who knows about the package Those who does not knows about the package

25%

75%

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.

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Recommendations
The following result shows that the Servo Geo Brand is not so visible to the auto drivers or in other words the brand awareness about Servo Geo is low. This awareness can be increased by asking the shopkeepers to put on display the Servo Geo Brand. For this a program is to be designed, which tie up shopkeepers directly with the Indian oil company. This program will work smoothly with the help & initiative of distributors. The company should seek the help & cooperation of its distributors in creating the Brand awareness. The company should put a pressure on the distributors that they have to convince shopkeepers to display Servo Geo at the front row of their shops. The company officials should also randomly check that the distributors are complying with this order. They can send a unknown person to a random selected distributor & check whether he follows the order given to him. If he is not following the order then action should be taken against him. A second method will be to display Servo Geo engine oil on the big hoardings across the road & in metro trains for advertisement of its packet. The Indian oil ltd. should properly position its Servo brand name in all its petrol pump of Delhi. It has been observed that name of Servo is not been significantly highlighted anywhere in its petrol pump. On the other hand Bharat Petroleum Ltd is promoting Mak Ge on a large scale all over its petrol pump. So, IOCL should utilize its large base of petrol pumps to market its brand name of Servo. Also the Company can put up banners of Servo Geo on IGL gas stations to increase the brand awareness among the drivers.

These methods will help Servo to come across the mind of new & old users. The people want to experiment with new engine oil, so this exposure will certainly help Servo to increase its market share.

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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). The findings & conclusions derived are as follows:-

% Packaging Colour Knowledge (or appeal of package colour)

Those who knows about the package colour Those who does not knows about the package colour

47% 53%

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.

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Recommendations
The packaging of Servo Geo is in the form of a mixture of Light Yellow & Dull Green. This packaging color seems to look quite outdated & a copy of other brand color. Servo should develop its own identity by redesigning its packaging color. This redesigning will give Servo a new Avatar & a fresh look to face its nearest competitors & it will help in boosting the sale of Servo Geo. All the brand engine oil packets looks alike to each other apart from Castrol which ahs wholly a unique identity The color of Servo look quite stereotype to the other exsisting brand color. So, Servo Geo needs to change the color to appeal to its end users. There should be few changes in color of Servo Geo. The designing experts consultation is required to make color look more attractive to the eyes of its users. The other major activity which can be carried out to increase the brand recall of Servo Geo is by endorsing any public image for its Brand Ambassadorship. For ex: Valvoline has taken the services of Famous Australian Cricketer Ricky Ponting for its promotion. Servo can also take the service of such a personality who has a great public image & is known for its reliability. I propose that that the Servo should endorses Maneka Gandhi or other environmentalist as its brand ambassador. She is linked as an environment care taker & CNG fuel used by auto drivers is also ecofriendly. So, her brand image will prove handy to promote Servo Geo. The poster & banners of Servo featuring Maneka Gandhi should be put on all its petrol Pump & distribution centers to promote Servo Geo Brand. A second option is to use the happy face of auto drivers as the poster image of Servo Geo. The same experiment Kurkure has also done & was extremely successful. The face of auto drivers can be changed regularly on its cover page to mark innovation. This strategy will build trust & confidence of auto drivers in the brand of Servo & hence its sales will increase.

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9) AGE WISE BRAND USAGE IN MARKET (Perception of Brand on the Basis of Average Age of Auto) (All Age in Years)
The last question was used to analyze the relation between the age of Auto & a particular brand of oil used. The result of Survey is as follows :

PRODUCT CASTROL VALVOLINE MAK GE BP SERVO OTHERS

MINIMUM AGE 1 4 1.5 1.5 1.5 8

MAXIMUM AGE 8.5 9 10 8 10 10

Average Age () 4 6.9 5.75 4.5 4.93 8.6

Std. Deviation () 2.96 1.77 2.89 2.53 3.36 0.89

% Variation 74.00 25.65 50.26 56.22 68.15 10.35

Findings
The above survey results show that there is no relation between the age of autos & use of a particular brand of oil. This result can be verified from the % variation in the chart. The % variation in the chart is quite high which shows that the data taken is not significant to justify any relationship between the age of autos & use of a particular brand of oil.

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Primary Research Work on Taxi Drivers

The primary research work was done on a group of taxi owners to understand the perceived value of different brands, factors affecting the buying behavior & overall market of CNG engine oil.The sample used for this research work was about 119 Taxi Drivers, with a variation in result of about 5% (which means that the result can have an error in between 5%) This sample was taken randomly from all the major areas of Delhi which include Indira Gandhi International Airport, Sub hash Nagar Taxi Stand, Hari Nagar Taxi Stand, Raja Garden Taxi Stand, New Delhi Railway Station, Old Delhi Railway Station, ISBT, Barakhambha Taxi Stand and Nizammudin Station. A questionnaire was designed consisting of 9 questions (Given in Appendix 2) to understand the overall Market variables mentioned above. The Survey on taxi drivers has taken a time span of 1 week (18/5/08 to 25/5/08). The Overall findings, conclusion & recommendations are mentioned in the next page. An important fact in this research work is that the engine oil in taxi is being put up by the taxi owners themselves & not by the taxi driver who is running the taxi. A taxi owner can have from 1 30 taxi drivers under his ownership. So, the real need by an oil company is to target this segment of taxi owners.

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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:

MARKET SHARE %
CASTROL SERVO

MAK GE
OTHERS

11

31

56

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 31%. 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 other engine oil holds the remaining 11% market

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%

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2) Brand image & selection factors of buying lube oil

The second question constitutes of the various factors which lead to buying of a particular Brand. Also this question was able to analyze the perceived value of all the major Brands. For this question there were four factors which were analyzed .The factors are as follow:Cheap Price of Engine Oil Good Quality of Oil Mechanic Selection Friends using it (Word Of Mouth) The perceived value of all the major 3 brands are analyzed as follows:-

Brand image & selection factors of buying lube oil

PRODUCT BRAND CASTROL % users SERVO % users MAK GE % users OTHERS % users CHEAP PRICE 0 0 3 QUALITY 100 MECHANIC SELECTION 0 (WORD OF MOUTH) 0

97

0 0 0

100

31

69

So, quality dimension is the top most criteria in each brand selection. Hence, the company should put extra effort to ensure good quality of oil reaching its consumers.

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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:-

FACTORS INFLUENCING THE BUYING DECISION

QUALITY PRICE

14%

86%

In this chart the factor wise preference order is given. This chart explains the factors which drivers consider in his mind while going for purchase of an engine oil. The findings, Conclusion & recommendation part of each factor will be done individually in the next page.

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1) Quality Factor 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.

Recommendations
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. It launched Castrol at relatively high price in order to differentiate from BP & to increase the perceived value of its product. (It means quality is directly proportional to its cost). Servo should launch a new product with a fresh name which should be meant only for the CNG taxis. It should be promoted that this engine oil is having the quality grades which suits a 4 wheeler CNG vehicle. Also increase the market price of this engine oil to increase the perceive value of the product. The price of this new product should only be 10 -15 Rs lower than the Castrol. This strategy will help Servo to penetrate the Castrol market. But proper promotion of this brand of oil is necessary. Also, lower the price of Servo Geo to completely separate it from this new launch. This will further help in increasing the market share of Servo in auto category which is quite priced sensitive. The second method to increase the market size of Servo is to reduce the quality duplicity. The above chart shows that the major factor which taxi owners look into while buying engine oil is its quality & durability. The quality dimension contributes about 90% of selection factors.

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So the company should ensure to provide best quality engine oil to its consumers. One of the major factors to be discussed here is of duplication in the oil in the market. All the engine oils are sold at various rates in the market. So, it is being assumed that the oil which is having the major variation in price is presumed to be of having duplicate quality . This variation in price of oil was found with the help of a question in the survey.

There is a table which shows the % variation of price of 3 Lt CNG oil in the market. This table talks about the maximum & minimum price of 3 Lt Oil available for a particular brand.

PRODUCT CASTROL MAK GE SERVO

MINIMUM PRICE 500 400 350

MAXIMUM PRICE 640 450 500

Average Price () 580 425 409

Std. Deviation () 57.87 35.36 51.92

The above table shows that the variation in the price level of 3 Lt Oil of different brand of Oil. The variation in price level of Castrol is relatively low as compared to price level in Servo Brand. This means that there is more duplication of Servo in market as compared to Castrol. So, Servo should monitor its distribution channel to ensure that quality product reaches the consumers. It will help in increasing the brand equity of Servo Geo in the market & ultimately this good will or brand equity will earn them a good amount of market share. The recommendation to improve the distribution channel is given in auto Survey report. That recommendation can be implemented in taxi segment also.

The Second way of analyzing the quality duplicity of Servo is by analyzing the survey data stating the Perception about Servo Geo. In this data the perception of drivers related to Servo is given. We have to analyze about the bad quality perception of Servo Geo with the help of the given survey data. This whole analysis with recommendations to improve the quality perception in the mind of consumers is given in next page.

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% Percepeption About Servo Brand

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

% Percepeption About Servo Brand

40

31 25

Good Quality

Low Quality

Costly

No Idea

Findings & Conclusion

The above chart clearly states the fact that 25% of Taxi owners do not buy Servo Geo mainly because of its low quality. So the quality variability is proving out to be a major challenge for Servo. The following Recommendations will help Servo to change perception about Servo Geo in market. This change in perception will lead to increase the sale of Servo Geo

Recommendation
The first thing Servo need to do is to strictly monitor its distribution channel. There should be a team of quality specialist who should in disguise randomly visit any engine oil shop & check the quality of Servo oil over there. If the engine oil is of poor quality then they should inquire about the distributor from where the shopkeeper is buying the oil & then raid that distributor shop & send both of them to police.

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 Also ask indirectly from taxi owners about the place where duplication of oil is more. They can provide with valuable information on this subject & hence it will help the team to work fast on catching the person doing duplication of oil. This will help in ensuring that Servo quality is retained & moreover it will help in stopping the black marketing of servo. Also it will help in changing the perception about the Servo Geo. Secondly the same team should visit on random basis the taxi owners & tell them about the properties of Servo engine oil. They should give them 1 Lt of Servo engine oil as a sample to test on their vehicles. Also give them contact number so that they can complain of any problem if they face during the use of that sample oil. This will help in gaining the confidence of taxi owners & also will lead to increase the sales of Servo. Also release information in newspaper & radio that a suitable prize will be given to those who will tell the name of shopkeepers & distributors who are doing duplication of Servo Geo. After getting the inputs the team can purchase some oil from that shop & then check the duplication. If found correct then corrective action should be taken.

All these activities will help in totally wiping out the duplication of Servo & hence the quality parameter will help in gaining the market of CNG oil by Servo. Also it will help to save the companys revenue which is going in black marketing.

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2) Cost Parameter
Cost is the second parameter which is affecting the buying decision of taxi owner. The findings, conclusion & recommendation to control this factor are given below.

Findings
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.

Conclusion
From the perception chart of Servo we can see that around 3% people are not buying Servo only because they feel it is costly*. Servo is cheap as compared to Castrol but the perceived value of Servo with respect to its price is quite less when we compared it with perceived value of Castrol with respect to its price. So here the main problem with Servo is to change the perceived value of Servo in this price range. Servo has to convince users that price which is being charge for engine oil is quite valid.

The following recommendations will help in changing the perceived value of Servo Geo brand. These recommendations are generated with the help of a question on the selection from various offers which should be given by company. These factors will help in changing the perception of consumers regarding the costliness of Servo Geo. The recommendations are as follows:

Recommendations
The perception about the price can be change by using these three factors: Discount Complimentary Gift items Extra Engine oil Anything in these three offers The discussions on these recommendations are done on the next page. These recommendations will be explained by the market wise % preference from the following offers. It will be explained with a bar chart drawn on next page.

*from the data on Perception about Servo Geo.

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The following chart will show the % wise preference from these three offers. The findings & recommendations are written below the table on the basis of the offers given.

% Offer Selection

DISCOUNT MORE QUANTITY IN SAME PRICE

34% 34%

COMPLIMENTRY GIFTS
ANYTHING IN THESE Three OFFERS
3% 29%

The above chart clearly shows that around 34 % people need discount in the engine oil. The company should give discount in the form of oil coupons along with its engine oil. The company can offer oil coupons on the back of bottle cap. The coupon will lead to get a cash discount on the filling of CNG gas at IG station. 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.So, the company can offer extra 200-500 ml engine oil with 3 or 5 lt pack of engine oil. This will help in making the owner realize that the amount charge is relevant for Servo Geo. 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. So the company should market the gift in such a manner that it only look as a method to change the perceived value of Servo Geo(because for 15-20 Rs, no taxi owner want to spoil its vehicle by using bad quality oil). The taxi owners preference for a particular gift is being explained by a bar chart in the next page.

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3) % 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:
% GIFT CHOICE

58

27 10 0 TOOTH PASTE SOAP BEAUTY CREAM

5 HAIR OIL ANYTHING

Recommendations
The following survey shows that 27 % of taxi owners like to get toothpaste as a gift item, but a significant % of taxi owners said they want anything with good quality engine oil. So, the company should give any gift item which can be use for family usage but once again to be mention out the fact that quality is the most important criteria for the selection of engine oil. The company should hire the service of any great public personality to promote the features of its engine oil brand. This will also help in changing the perception about Servo Geo. Also the company should keep in mind that the gift items given should not be outdated in nature. The outdated gift item spoils the brand image of company. For ex: MAK GE has to face severe criticism for providing outdated toothpaste to the users. The company should ensure that the gift items should reach the users. Many of the times the distributors or shop keepers sell this gift item as a separate commodity or use for their personal consumption. All the other Recommendations are same as given for auto segment.

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4) Knowledge About Servo Brand

There was a question in the questionnaire which was asked to analyze the knowledge about the Servo Brand. The question was to figure out if the customers know about the color of Servo Geo. The findings & conclusion of the survey is as follows:-

% Knowledge About Servo Brand

Those who knows about the package colour Those who does not knows about the package colour

46% 54%

Findings
Around 54% of taxi owners do not know about the color of Servo Geo engine oil.

Conclusions
The high percentages of the above findings are due to various reasons. The reasons are as follows: The taxi owners are quite loyal to the brand which they purchase for their vehicles. Hence, they never give consideration to the other Brand. They themselves are not buying engine oil, but one of their workers (taxi driver) is bringing the engine oil from their respective engine oil shop. It can be due to the fact that the shop from where they purchase the engine oil does not put the Servo Geo in front of the Shop. It can be also due to the fact that the awareness related to Servo Geo is not sufficient. (It means Brand advertisement is not done successfully).

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The following recommendations will help Servo to overcome this Problem.

Recommendations
The Indian Oil Ltd. has got a huge product range from petroleum products, lubricants, coolants grease oil, gear oil etc. In lubricants also it has got a high range from petrol, diesel & CNG lubricants. Servo is the brand name for all the family of lubricants. Servo is a very old name in the market of Lubricants, so the company just promotes its brand name Servo for all the lubricants. Servo Company has to understand that its CNG engine oil is a late entrant in the market of gas oil which is already having many big competitors. So, by just promoting its umbrella name wont help its CNG oil brand. In maximum number of Indian oil petrol pumps or engine oil shops in Delhi there is no promotion of this CNG engine oil (Servo Geo). It looks like, that the Indian oil is shying to accept the challenge of this CNG engine oil market or does not consider this CNG oil market important for its growth. Its nearest rival Bharat Petroleum which is also a public ltd company like Indian Oil is the market leader of this segment but still it has not become complacent. It is promoting its Brand MAK GE in all possible manners by either putting at front of its petrol pumps, by advertising in the IG gas stations, by opening gas filling station at its petrol pump & by all the means. So for increasing the sales of the Servo, the company should first change its complacent attitude & gear up to take on the CNG engine oil market. The remaining recommendations to increase the brand awareness can be seen from the CNG auto survey brand awareness part.

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5) 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:

% MARKET KNOWLEDGE ABOUT THE GIFT ITEMS

YES( IF A PERSON KNOWS THE OFFER GOING ON IN MATRKET) NO ( IF A PERSON DOESNOT KNOW ABOUT THE SCHEME/OFFER) 9%

91%

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 & are well off financially. Hence they wont care for any gift item schemes.

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Recommendations
The company should first select a proper brand ambassador for its engine oil who can promote the oil along with the gift item. The company should advertise this gift item in all Hindi news papers & leading radio stations of Delhi The company should invite the taxi owners in an evening party where they can be taught about the maintenance of their vehicles. Over there, big banners of Servo Geo can be put up & hence it will lead in building up share of heart & share of mind for Servo Geo. This is a tedious task to invite all the taxi owners but with little hard work it can be accomplished. The company should chalk out the information of all the taxi owners from the RTO data. Then the company should divide the Delhi region into 4 equal parts. After completing this task, the company should give responsibility to their officers to organize the tea party for these 4 areas separately. At the end of the tea parties give the feedback form to the taxi owners & ask for their advice about how to serve them better & other recommendations. Working on these advices will help company to know the root cause of trouble & their failure in increasing the sales of CNG engine oil. This activity will not only make taxi owners happy as they will feel respected, but also help the company to register its brand on the minds of consumers. Secondly it will help the company to know the root cause of problems affecting Servo Geo. This task should not be stop here only. This process should continue in every month or in every bi month, so that the impression of company brand name will register on the mind of consumers & also it will help the company to know that how much more improvement is required to become market leader. Also side by side evaluate the sale & market size of Servo Geo to check the potential & capability of this task.

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Primary Research Work on Shopkeepers

The primary research work was done on the shopkeepers to understand the perceived value of different brands, factors affecting the buying behavior & overall market of CNG engine oil.The sample used for this research work was about 20 shopkeepers. The primary motive to cover shopkeeper was mainly due to the fact that he is also one of the stake holders in the growth of sales of a company . This sample was taken randomly from all the major areas of Delhi which include Subash Nagar, Punjabi Bagh, Karol Bagh, and Raghubir Nagar. A questionnaire was designed consisting of 5 questions (Given in Appendix 3) to understand the overall Market variables mentioned above. The Survey on shopkeepers has taken a time span of 1 week (26/5/09 to 3/6/09). The Overall findings, conclusion & recommendations are mentioned in the next page. Before the survey a random exercise was taken to determine the range in which gas engine oil are packed & their corresponding price range. The findings about this survey are mentioned on next page along with the questionnaire results.

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Exploratory Shopkeeper Survey

a)The following table shows the range of different brands of CNG engine oil packets available with the shopkeepers .The result of the survey are as follows:-

S.NO.

BRAND NAME 0.5 lt 1 lt

RANGE (LT) 3 lt 3.5 lt 5 lt 20 lt

1 2 3 4 5 6 7 8 9 10 11

CASTROL GTX BP(VANELLUS) VALVOLINE SERVO MAK GE GASENOL(H.P.) GULF IPOL BOSCH SHELL WAXPOLL

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b) The above chart explains the price range for all the major brands. The below chart compares the MRP of all different products .The results are as follows:-

S.NO.

BRAND NAME 0.5 lt CASTROL GTX 1 lt

Price (Rs) 3 lt 655 118 222 3.5 lt 5 lt 20 lt

1 BP(VANELLUS) 2 VALVOLINE 3 SERVO 4 MAK GE 5 GASENOL(H.P.) 6 GULF 7 IPOL 8 BOSCH 9

172 499 86 150 539 146 814

3270

2800

3130

84.5

162

750

162 551 184 435 163

200

609

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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:OPEN 1/2 LT 1 LT 60

25 15

% MARKLET SELLING PACKET

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.

Recommendations
The company should understand this fact that 1 lt engine oil is the major selling packet in auto drivers community. So company should finalize any schemes in the form of discount, gift items or extra oil with 1 lt oil package only. This will provide a more exposure to the company oil & hence help in increasing the sales. The remaining recommendation regarding the package are same as mentioned with the question in auto drivers survey.

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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:-

OPEN

1 LT

3 LT 60

30

10

% MARKLET SELLING PACKET

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 15 % 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

Recommendations
The company should understand this fact that 3 lt engine oil is the major selling packet in taxi drivers community. So company should finalize any schemes in the form of discount, gift items or extra oil with 3 lt oil package only. This will provide a more exposure to the company oil & hence help in increasing the sales.

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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. The table below shows the result for this influence factor

% MARKET INFLUENCE
% MARKET INFLUENCE 50 40

10

ALWAYS RECOMMEND DRIVERS

NEVER RECOMMEND DRIVERS

SOMETIMES RECOMMEND DRIVERS

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).

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Recommendations
The company should do all the activities to increase the perceive value of Servo Geo. The table drawn below shows the perception% of shopkeepers who consider it as a top quality oil. The table is as follows:-

TOP MOST PRODUCTS FOR A SHOPKEEPER (PERCIEVED FACTOR)

PRODUCT VALVOLINE BP SERVO MAKGE CASTROL

% MARKET SHARE 20 15 10 10 45

The table clearly shows that Castrol enjoys the highest perceived value of top quality oil by around 50% of shopkeepers. Only 10 % shopkeepers feel that Servo is top quality oil. So, this perceived % of shopkeepers needs to be increase for increasing the market share of Servo. This high perceives value can be achieved by promoting Servo Geo in a right way. They should give advertisement in newspapers & TV about the performance capabilities of Servo as compared to other Engine oil. All other ways of doing promotion is mentioned in auto drivers survey report. Servo should ensure to have a good relation with the shopkeepers. They should design the distribution channel in such a way that the shopkeepers can get a good margin on the sale of Servo Geo. Thus this will ensure that the shopkeepers will promote Servo & hence it will help in increase in sale.

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4) SELECTION FROM THESE THREE 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:-

SELECTION FROM THESE THREE OFFERS

60

20
15 5

DISCOUNT

MORE QUANTITY IN SAME PRICE

COMPLIMENTRY GIFTS

ANYTHING

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.

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Recommendations
The above survey was done to influence the drivers buying decision power by promoting the engine oil with Discount, Gift items & extra oil.

These three offers can be used by shopkeepers to influence the customers to go for a particular brand. So the company should come up with new ideas & schemes so that the shopkeepers can use it to convince drivers to go for Servo Geo oil.

The recommendations on these three offers are given in previous report on auto & taxi driver survey. These recommendations will also help company to get a good promotion from shopkeepers community. This promotion will also help in increasing the brand awareness of Servo Geo.

The other recommendations to change the perception or increase the perceive value of Servo is given in taxi & auto drivers survey respectively.

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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:-

TOOTH PASTE 40

SOAP

BEAUTY CREAM FOR FAMILY

HAIR OIL

SHAVING CREAM

35

15 10

0 GIFT CHOICE

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.

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Primary Research Work on Mechanics

The primary research work was done on the mechanics to understand the perceived value of different brands & factors affecting the buying behavior & overall market of CNG engine oil. The sample used for this research work was about 30 shopkeepers. The primary motive to cover Mechanic was due to fact that he is also stated as one of the influencing factor in the buying decision of Engine Oil by drivers.

This sample was taken randomly from all the major areas of Delhi which include Subash Nagar, Raghubir Nagar & Tilak Nagar .

A questionnaire was designed consisting of 4 questions (Given in Appendix 5) to understand the overall Market variables mentioned above. The Survey on mechanics has taken a time span of 5 days . The Overall findings, conclusion & recommendations are mentioned in the next page.

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CNG Mechanic Survey

1) TOP MOST PRODUCT FOR A MECHANIC (PERCIEVED FACTOR)
The first question asked from the mechanics was the top most CNG Engine Oil in the market of Delhi. The results & conclusions are as follows:-

% Percieved Share
VALVOLINE SERVO MAKGE CASTROL

20% 46%

7%

27%

Findings
The above Pie chart clearly shows that almost 50% of mechanics believe that Castrol is the best CNG Engine Oil in market today. MAK GE & Valvoline are perceived to be the top product by the same Percentage of Mechanics. Only7 % mechanics believes that Servo Geo is the best Oil In the market.

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Conclusions
The above chart clearly states that the Castrol is being perceived as the top quality product by a majority of Mechanics. This result is also due to the fact that the cost of Castrol is too high in the given market. The other factor of the reasoning of best CNG oil is discussed in the next questionnaire.

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2) REASONS FOR THE PERCEPTION

The following chart explains the reasons of the given perception of a Mechanic for the best CNG oil in the market. The results & conclusions are given below:-

Reasons for the Perception

Good Lubricating Oil Engine Runs Smoothly

27%

73%

Findings
The above Pie chart clearly states the fact that around 70 % mechanics consider a good quality oil to be having a good lubrication property. The remaining 30 % believes that good quality oil is judged by the running of Vehicles.

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Conclusions & Recommendations

The above Pie chart confirms the fact that people perceives Castrol as the Best CNG oil due to its good lubricating property & also due to the better running of Vehicles after filling the oil. The above chart shows that the perception of Mechanics is formed from these two factors only. So if the Servo % is too less on the perceived chart it states that the brand is lagging in forming good perception in these two parameters. So to change the perception of mechanic towards the Servo, the company should ask its officers to talk to mechanics & know the reasons of lagging of Servo Geo from other brands. Servo should take classroom programs for mechanics & teach them the new ways of delivering Good Service to its customers. This will help in improving the perceived value of Servo in the minds of mechanics. This will ultimately help in raising the sale of Servo Geo with the help of Mechanics.

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3) FACTORS INFLUENCING BUYING DECISION OF DRIVERS

The third question discuss about the recommendation factor of Mechanics which effect the sales of the Engine Oil. The Results of the data analysis are as follows:-

% MARKET INFLUENCE

60

27 13

ALWAYS RECOMMEND DRIVERS

NEVER RECOMMEND DRIVERS

SOMETIMES RECOMMEND DRIVERS

Findings
The above bar chart clearly shows that the 60% of mechanics recommend the use of specific engine oil to its customers. There are around 27 % of the mechanics who always recommend the use of particular oil to its customers.

Conclusions
The above table clearly states the fact that almost 90 % of the mechanics recommend their customers to go for the usage of a particular brand. These recommendations are on the basis of the lubricating property, the price margin of a particular brand & the high perceived value of a particular brand.

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Recommendations
From the analysis in the chapter on auto & taxi drivers we derive out the fact that the mechanics are also one of the major factors which influences the sale of given Engine Oil. The companies whose sales are notching to be on top is due to somewhere linkage to mechanics (See note on the knowledge given to Mechanics by Valvoline). So, Servo also has to buid a good brand image in the minds of mechanics so that the mechanics can further recommend the Servo brand to the drivers .This image can be build by coming in contact with the roadside mechanics. The company officials should seek their advice & try to implement them. Also the company officials should correct the mechanics on the wrong perceptions about Servo Geo quality. They should educate them on the quality standards used by Servo. They should clear all their doughts about Servo. This will help in reviving the image of Servo as a quality product & hence mechanics will recommend this quality product to the drivers.

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4) % Percepeption About Servo Brand

The last question discuss on the perception of Servo Geo in the minds of Mechanic. The findings, conclusion & recommendations of this analysis is as follows:-

% Percepeption About Servo Brand

43

30

20

Good Quality

Low Quality

Costly

No Idea

Findings
The majority 43 % of mechanic feels that the Servo is having a poor quality. There are around 30% who believes that Servo is a good quality Engine Oil. Around 20 % believe that Servo is costly Engine oil & remaining & 7% are having no idea about Servo Geo.

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Conclusion
The above bar chart clearly states the fact that around 60% of mechanics are having a wrong mindset about Servo Geo. Also another 7 % are having no clue about the presence of CNG Engine oil by Servo.

Recommendations
The majority of mechanics are having the same thoughts that Servo Geo oil is coming in Duplication & is having a bad quality. So, here also we came across the problem of duplication of engine oil. To minimize this duplication we should implement all the recommendations as stated in the auto & taxi Drivers chapter. Also there should be a team to check the duplication of engine oil. There are around 10 % of people who doesnot have any idea about Servo Geo. The company can increase its brand presence by installing the board of Servo Geo on the top of the shops of Mechanics. This will help in promoting the brand of Servo by increasing its brand awareness & also help in linking Servo with the Mechanic Community. The Servo can finance the shed cloth of the mechanic shop as a part of promotion of its CNG engine oil. Also it can issue water coolers & other gift items to the mechanics for promoting its engine oil. All this recommendations will help Servo to win the confidence of the Mechanic community & thus will help in increasing the market share of the Servo in CNG Engine Oil.

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Appendix1: CNG Auto Survey Questionnaire

Q.1) Is the auto o Self owned o Rented one Q .2) whats the age of your auto? Ans

Q .3) what engine oil you use for your auto? Ans

Q .4) Does you buy engine oil on the recommendation of mechanic? o Yes o No (If Yes then move on to the 6th question otherwise answer 5th question )

Q .5) which of the following factor lead you to buy this Brand o Cheap Price o Quality o Word of Mouth

Q .6) which pack of Lube oil you generally buy? o Open o Lt o 1 Lt o 3 Lt

Q .7) How Much you pay for a Given Lt of lube oil? Ans

Q .8) what you want the company should give from the following offers? o Discount o Complementary Gift Items o Anything from these two Offers

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Q .9) If company gives gift items then what item you desire to have with you? o Toothpaste o Soap o Hair oil o Beauty cream For family o Shaving Cream o Anything

Q .10) Servo 1Lt pack comes in? o Plastic packet o Plastic bottle o Both o Dont know (If given correct Ans then move on the next question otherwise jump to q.12)

Q.11) what is the packet color of Servo? Ans

Q .12) Servo is a? o Good quality oil o Low quality oil o Costly oil o No idea

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Appendix 2: CNG Taxi Survey Questionnaire Q .1) what engine oil you use for your auto? Ans Q .2) Does you buy engine oil on the recommendation of mechanic? o Yes o No (If Yes then move on to the 3rd question otherwise answer 4th question) Q .3) which of the following factor lead you to buy this Brand o Cheap Price o Quality o Word of Mouth Q .4) which pack of Lube oil you generally buy? o Open o 1 Lt o 3 Lt o 5 Lt Q .5) How Much you pay for Given 3 Lt of lube oil? Ans Q .6) what you want the company should give from the following offers? o Discount o Complementary Gift Items o More quantity in same price o Anything from these two Offers Q .7) If company gives gift items then what item you desire to have with you? o Toothpaste o Soap o Hair oil o Beauty cream For family o Shaving Cream o Anything

Q.8) what is the packet color of Servo? Ans

Q .9) Servo is a? o Good quality oil o Low quality oil o Costly oil o No idea

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Appendix 3: Shopkeeper Survey Questionnaire

Q .1) which pack of Lube oil you generally sell for autos? o Open o 1/2 Lt o 1 Lt o 3 Lt

Q .2) which pack of Lube oil you generally sell for autos? o Open o Lt o 3 Lt o 5 Lt

Q .3) what you think the company should give from the following offers? o Discount o Complementary Gift Items o More quantity in same price o Anything from these two Offers

Q .4) if company gives gift items then what item should it give ? o Toothpaste o Soap o Hair oil o Beauty cream For family o Shaving Cream o Anything

Q .5) Do you recommend drivers to buy any particular brand? o Yes o No o Sometimes

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Appendix 4: Economic Demographics

Q .1) How many family members are there in your family? o 1-2 o 3-4 o 5-6 o 6 & above

Q .2) How much is your total family income? Ans

Q.3) How much you have studied? Ans

Q .4) Do you have loan or rent to pay every month? o Yes o No (If no then go to Q.6 or else go to Q.5)

Q .5) How much loan/rent you pay per month? Ans

Q .6) How much you spend on an average on your engine oil? Ans

Q .7) Do you know the meaning of quality standard 20w50? o Yes o No (If yes then enquire a bit about the meaning)

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Annexure 5: Mechanic Survey Questionnaire

Q .1) Which is the best CNG oil for Auto & Taxi? Ans

Q .2) How you Figure out that this is the best oil? Ans

Q .3) Do you Recommend Drivers to use any engine oil? o Yes o No o Sometimes

Q .4) How is Servo is as CNG oil? Ans

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Bibliography
1. Philip Kotler and Kevin Lane Keller 2008 Marketing Management. Delhi: Pearson education. 2. Information on Delhi Transport http://transport.delhigovt.nic.in/Registration/info11.html as accessed on June 2, 2009. 3. Information on CNG Vehicles, www.igl.co.in as accessed on May 29, 2009. 4. Engine oil & its Viscosity, http://auto.indiamart.com/auto-consumables/engine-oil-itsviscosity.html as accessed on May 29, 2009. 5. Understanding lube oil & Its Job function,
http://gulfcoastfilters.com/understanding_lube_oil_and_its_j.htm as accessed on May 16,

2009. 6. Motor Oil Viscosity Grades,

http://www.upmpg.com/tech_articles/motoroil_viscosity/index.html as accessed on May

28, 2009. 7. Deteoration of Engine oil,

http://www.upmpg.com/lubricationnews/why_motoroil_deteriorates/index.html,http://www.fr ost.com/prod/servlet/market-insight-top.pag?docid=4968520 as accessed on June 5, 2009.

8. About Servo brand, www.iocl.com as accessed on May 12, 2009. 9. About MAK GE brand, www.bpcl.com as accessed on May 12.2009. 10. About Castrol GTX & BP Vallenus brands, www.castrolindia.com as accessed on May 12.2009. 11. About Valvoline brand, www.valvolineindia.com as accessed on May 12, 2009. 12. Pande Vinay, Valvoline proves fastest growing Indian lubricant Company, file:///e:/Users/intel/Desktop/mislleaneous/valvoline-proves-fastest-growingindian.html , as accessed on June 10, 2009. 13. Malhotra K Naresh 2009 Marketing Research, Delhi: Pearson Education.

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