SUBMITED TO

SUBMITED BY

DR. AMIT UPADHYAY

NITESH KUMAR SINGH

LECT. AT AIT SCHOOL OF MANAGEMENT

PGDM 1 YR
ROLL NO. M12136

CERTIFICATE
This is to certify that this MINOR PROJECT entitled MARKETING STRATEGY
OF MARUTI SUZUKI INDIA LTD. Submitted to Apeejay Institute of
Technology, School of management GREATER NOIDA (U.P) in partial fulfilment
of the requirement for the degree of PGDM, Is as original work carried out by
NITESH KUMAR SINGH, PGDM-1st, Sec C, Roll no. M12136 Under my
guidance.
The matter embodied in this project is a genuine work done by the student and has
not been submitted whether to this university or to any other university/institute for
the fulfilment of the requirement of any course of student.

Signature of the student

Signature of the guide

(Name and Designation)

DECLARATION

I, Nitesh kumar singh, student of PGDM 1st Sec-c declare that the
Minor report entitled Marketing strategy of Maruti Suzuki India Ltd.
is the result of my own efforts and is based on information collected.
Furthermore, the information presented in this report is correct to the best of
my knowledge.

Place: Greater noida

Date:

Nitesh kumar singh

ACKNOWLEDGEMENTS

The project MARKETING STRATEGY OF MARUTI SUZUKI INDIA LTD is

developed during the course of PGDM (1st year) for the submission at Apeejay Institute
of Technology, School of management.
I would like to present my heartfelt gratitude to Dr.Amit Upadhyay for showing
full in me & providing me full independence in design & development of this project and
gathering information about department library. Without help & support this superb
outcome was never possible.
I am very thankful and obliged to my project guide Dr.Amit Upadhyay for
suggesting me this project. I must convey my sincere thanks to all my faculty members
for extending their co-operation during the various stages of project.
At last but not the least, I am also thankful to my colleagues, for their constant
follow up and boost provided by them through their encouragement and help during the
course of carrying out the project.

(NITESH KUMAR SINGH)

INDEX

INTRODUCTION OF THE COMPANY

OBJECTIVE OF THE COMPANY

RESEARCH METHODOLOGY
LIMITATIONS
CONCLUSION
BIBILIOGRAPH

INTRODUCTION

COMAPANY PROFILE
MARUTISUZUKI INDIALIMITED
Maruti is India's largest automobile company. The company, a joint venture with
Suzuki of Japan, has been a success story like no other in the annals of the Indian
automobile industry.
Today, Maruti is India's largest automobile company. This feat was achieved by the
missionary zeal of our employees across the line and the far-sighted vision of our
management.

The Company Mission:

To provide a wide range of modern, high quality fuel efficient vehicles in order to meet
the need of different customers, both in domestic and export markets.

The Company Vision:

We must be an internationally competitive company in terms of our products and
services. We must retain our leadership in India and should also aspire to be among the
global players.

Their focus is on:

Building a continuously improving organisation adaptable to quick changes Providing
value and satisfaction to the custome Aligning and fully involving all our employees,
suppliers and dealers to face competition Maximising Shareholder's value Being a
responsible corporate citizen At Maruti, they have a clear perspective on manpower. They
see it as a unique resource, in the sense that optimal productivity of other resources
depends largely on the way human resources are utilised.

The basic philosophy of management that underlies the Maruti culture is that all
employees of the company should be moulded into a team which then strives as one, to
achieve commonly shared company goals and objectives. To make this philosophy
tenable, the Company takes several initiatives. Inputs are sought from employees at
all levels. They believe that everyone should contribute to the formulation of company
policies, goals and objectives. Secondly, at Maruti, they encourage leadership in the best
sense of the word. According to us, a leader is one who must be impartial, must have the
ability to rise above his own subjectivity, and, most importantly, must practice what he
preaches.
They understand that the process of creating a sense of belonging that all employees can
identify with is a lengthy one. To ensure that this translates into concrete reality, they
have taken several simple but specific and well thought out measures. The first step in
this direction has been the introduction of a common uniform for all employees. Another
measure is the creation of a common canteen where all employees have lunch, stand in
common queues, and sit on the same table. Common toilets, common transport and
similar facilities for all levels of employees are other measures that reinforce their
emphasis on genuine equality in the workplace.
At Maruti They do not believe in the notion of organisational hierarchies. As a
matter of fact, the management structure and systems in Maruti have been designed to
promote decentralisation of authority. Maruti has a horizontal management structure with
only four functional levels of responsibility to facilitate quicker decision making.
Another focus area of the Maruti culture is the maintenance of a smoothly functioning
communication network. Maruti believes that communication channels between labour
and management cannot simply consist of having a labour representative on the Board of
the Company. They have faith in the ability of labour to effectively participate in
management and make constructive suggestions. To encourage this, they ensure that
there is a thorough dissemination of information at all levels, through newsletters or via a
letter from the Chief Executive to all employees. Meetings with the Union are held
regularly, and programmes being contemplated by the Company are discussed with the
Union.

The Sahyog Samiti, a collection of representatives of non-unionised employees,

training programmes in Japan, Quality Circles, productivity-linked incentive schemes,
and an ethos of discipline and teamwork, all contribute to the Maruti culture.
Several measures of performance have made amply clear that Maruti has established a
truly healthy work culture. They have met all project and performance targets since
inception. Their productivity levels are constantly improving. The Company has had
good labour relations with employees from the very beginning, and they have been
successful in the export market. Yet, the Maruti culture is one that does not believe in
resting on its laurels. They adhere to the spirit of Kaizen, which states that constant
improvement is always possible. The most basic tenet of productivity that they hold dear
is that " Today should be better than Yesterday and Tomorrow should be better than
Today".
Maruti Udyog Limited (MUL) was established in Feb 1981 through an Act of
Parliament, to meet the growing demand of a personal mode of transport caused by the
lack of an efficient public transport system.
Suzuki Motor Company was chosen from seven prospective partners worldwide. This
was due not only to their undisputed leadership in small cars but also to their
commitment to actively bring to MUL contemporary technology and Japanese
management practices (which had catapulted Japan over USA to the status of the top auto
manufacturing country in the world).
A licence and a Joint Venture agreement was signed between Government of India and
Suzuki Motor Company (now Suzuki Motor Corporation of Japan) in Oct 1982.
The objectives of MUL then were:

Modernization of the Indian Automobile Industry.

Production of fuel-efficient vehicles to conserve scarce resources.

Production of large number of motor vehicles, which was necessary for

economic growth.

Core Value

Customer Obsession

Innovation and Creativity

Networking and Partnership

Openness and Learning

Vision
The leader in the India Automobile Industry, Creating Customer Delight and
Shareholders Wealth; A pride of India

Technological Advantage
We have introduced the superior 16 * 4 Hypertech engines across the entire Maruti
Suzuki range. This new technology harnesses the power of a brainy 16-bit computer to a
fuel-efficient 4-valve engine to create optimum engine delivery. This means every
Maruti Suzuki owner gets the ideal combination of power and performance from his
car.
Our other innovation has been the introduction of Electronic Power Steering (EPS) in
select models. This results in better and greater maneuverability. In other words, our cars
have become even more pleasurable to drive.

Production/R&D
Spread over a sprawling 297 acres with 3 fully-integrated production facilities, the
Maruti Udyog Plant has already rolled out over 6 million vehicles. In fact, on an average,
two vehicles roll out of the factory every minute. And it takes on an average, just
14 hours to make a car. More importantly, with an incredible range of
11 models available in 50 variants, there's a Maruti Suzuki made here to fit every carbuyer's budget. And dream.

Production Milestones
1st vehicle produced, December 1983

1,00,000 vehicles produced by August, 1986

5,00,000 vehicles produced by June, 1990

15,00,000 vehicles produced by April, 1996

20,00,000 vehicles produced by October, 1997

25,00,000 vehicles produced by March, 1999

30,00,000 vehicles produced by June, 2000

35,00,000 vehicles produced by December 2001

40,00,000 vehicles produced by April, 2003

45,00,000 vehicles produced by April, 2004

AWARDS
2005 Number one in JD Power SSI for the second consecutive year. Number one in
JD Power CSI for the sixth time in a row - the only car to win it so many times.
M800, WagonR and Swift topped their segments in the TNS Total Customer
Satisfaction Study.

Leadership in the JD Power Initial Quality Study - Alto number one in its segment
for the 2nd time in a row, Esteem number one in its segment for the 3rd year in a
row, Swift number one in the premium compact segment WagonR and Esteem top
their segments in the JD Power APEAL study TNS ranks Maruti 4th in the Corporate
Reputation Strength (CSR).
Study (#1 in Auto sector)-Feb 05 Maruti bagged the "Manufacturer of the year"
award from AutocarCNBC (2nd time in a row)-Feb 05

First Indian car manufacturer to reach 5 million vehicles sales

Business World ranks Maruti among top five most respectedIndia-Oct 04
Maruti ranked among top ten (Rank7) greenest companies in India
By Business Today - Sep '04

2004

Maruti Suzuki was No. 1 in Customer atisfaction, No. 1 in Sales

Satisfaction No.1 in Product Quality (Esteem and Alto) and No. 1 in

Product Appeal (Esteem and Wagon R)

No. 1 in Total Customer Satisfaction (Maruti 800, Zen and Alto)

Business World ranked us among the country's five most respected

companies

Business World ranked us the country's most respected automobile

company

Voted Manufacturer of the year by CNBC

2003

Maruti 800, Maruti Zen and Maruti Esteem make it to the top 10
automotive brands in "Most Trusted Brand survey 2003"
J D Power ranked 3 models of Maruti on top: Wagonr, Zen and
Esteem
Maruti 800 and Wagonr top in NFO Total Customer Satisfaction
Study 2003.
MUL tops in J D Power CSI (2001) for 4th time in a row

2001

MUL tops in J D Power CSI (2001) for 2nd time in a row: another
international first

2000

Maruti bags JD Power CSI - 1st rank; unique achievement by market

leader anywhere in the world

MSM launched as model workshop in India; achieves highest CSI

1999

rating.
Central Board of Excise & Customs awards Maruti with "Samman
Patra", for contribution to exchequer and being an ideal tax

1998

1996

CII's Business Excellence Award

Maruti wins INSSAN award for "Excellence in Suggestion

Scheme"
Awarded the Star Trading House status by Ministry of Commerce

1994-95

Engineering Exports Promotion Council's award for export

performance

1994

Best Canteen award among Haryana Industries as part of employee

welfare

1992-93

Engineering Exports Promotion Council's award for export

performance

1991-92

Engineering Exports Promotion Council's award for export

performance

WHYMARUTISUZUKI

The Quality Advantage

A car is an engineering product, only as good as the technology used to make it.
Actual users of our technology are saying something very clearly Maruti Suzuki is
No.1 in quality:
Maruti Suzuki owners experience fewer problems with their vehicles than any other can
manufacturer in India (J.D. Power IQS Study 2004). The Alto was chosen No.1 in the
premium compact car segment and the Esteem in the entry level mid-size car segment
across 9 parameters.
The J.D. Power APEAL Study 2004 proclaimed the Wagon R. No. 1 in the
premium compact car segment and the Esteem No.1 in the entry level midsize car segment. This study measures owner delight in terms of design,
content, layout and performance of vehicles across 8 parameters.
Maruti Suzuki has a sales network of 307 state-of-the-art showrooms across
189 cities*, with a workforce of over 6000 trained sales personnel to guide our
customers in finding the right car. Our high sales and customer care standards
led us to achieve the No.1 nameplate in the J.D. Power SSI study
2004. The SSI study measures sales satisfaction across 6 parameters: deal received,
paperwork, dealer facility, salesperson, delivery timing and delivery process.
Maruti Suzuki has not only got the No.1 nameplate in the J.D. Power SSI study
2004, but also ranked way above the industry average (Maruti Suzuki was at
784 while industry average was at 760). What is significant is that it was ranked
above Skoda, Ford, Chevrolet, Mitsubishi and Hyundai.
To be really happy with the car you own, it should have a reliable service network
at hand and within easy reach. Their 1036 city

strong service network is

equipped to service 20,000 vehicles a day. No wonder Maruti Suzuki has been
awarded the No.1 nameplate in customer satisfaction in India for the fifth year in
a row, a feat unprecedented for any automobile market leader in the world.

In the J.D. Power CSI study , Maruti Suzuki scored the highest across all
7 parameters: least problems experienced with vehicle serviced, highest
service quality, best in-service experience, best service delivery, best inservice experience, most user-friendly service and best service initiation
experience.
In fact, 92% of Maruti Suzuki owners feel that work gets done right the first time during
service. The J.D. Power CSI study 2004 also reveals that 97% of Maruti Suzuki
owners would probable recommend the same make of vehicle, while 90% owners
would probable repurchase the same make of vehicle.

A Buying Experience Like No Other

Maruti Suzuki has a sales network of 307 state-of -the-art showrooms across 189
cities, with a workforce of over 6000 trained sales personnel to guide our customers in
finding the right car. Our high sales and customer care standards led us to achieve the
No.1 nameplate in the J.D. Power SSI Study 2004.

Quality Service Across 1036 Cities

In the J.D. Power CSI Study 2004, Maruti Suzuki scored the highest across all 7
parameters: least problems experienced with vehicle serviced, highest service
quality, best in-service experience, best service delivery, best service advisor experience,
most user-friendly service and best service initiation experience.
92% of Maruti Suzuki owners feel that work gets done right the first time during
service. The J.D. Power CSI study 2004 also reveals that 97% of Maruti Suzuki
owners would probably recommend the same make of vehicle, while 90% owners
would probably repurchase the same make of vehicle.
One Stop Shop

At Maruti Suzuki, you will find all your car related needs met under one roof. Whether
it is easy finance, insurance, fleet management services, exchange- Maruti Suzuki is set
to provide a single-window solution for all your car related needs.

The Low Cost Maintenance Advantage

The acquisition cost is unfortunately not the only cost you face when buying a car.
Although a car may be affordable to buy, it may not necessarily be
affordable to maintain, as some of its regularly used spare parts may be priced quite
steeply. Not so in the case of a Maruti Suzuki.
It is in the economy segment that the affordability of

spares is

most

competitive, and it is here where Maruti Suzuki shines. The recent Auto car
Survey conducted in August 2004 bears testimony to this fact. In the Maruti
Suzuki stable, the Omni has the lowest aggregate cost of spares followed by the
Maruti-800. The Maruti- 800 has the cheapest spares of any Indian car with a
basket of just Rs. 23,422.
In the Lower Mid-size segment as well, price-consciousness is very high,
where the cars have to be not only affordable on purchase price but also need to
combine

quality,

drivability

and

have

comfortable

interiors.

In

this

segment, the Maruti Suzuki Versa has scored particularly well with the lowest cost
of spares in the segment. In the Upper Mid-size segment, the Maruti Suzuki
Baleno has the segment's lowest prices on a majority of the spares.
Lowest Cost of Ownership
To be really happy with the car one owns, it should be easy on the pocket to
buy and to run-which is why the cost of ownership is so important. And here
again, a Maruti Suzuki is a clear winner, as shown by the recent J.D.Power
CSI study 2004.
It is clear that a Maruti Suzuki delights you even when you run it for years. The
6 highest satisfaction ratings with regard to cost of ownership among all models are
all Maruti Suzuki vehicles: Zen, Wagon R, Esteem, Maruti 800, Alto and Omni.
They are proud to have the lowest cost of operation

km

(among

petrol

vehicles) - the top 5 models are all Maruti Suzuki models: Maruti 800, Alto,
Zen, Omni and Wagon R.

Employee Quality Measures

Kaizen is based on the concept of making incremental improvements in our
products. It incorporates a series of continuous small and simple improvements, which
aim at involving employees at all levels.
The Suggestion Scheme is based on the same principle. Under this scheme, employees
are encouraged to make suggestions for improvement in any area of our operation. Over
50,000 suggestions are received from employees every year.
Maruti has won the First place in "Excellence in Suggestion Scheme Contest
2003", which is the 6th consecutive award won in as many years. This contest is
organized by Indian National Suggestion Schemes Association (INSSAN). Since
1998 Maruti has won this award 10 times.

"Quality Circles" are groups of five to eight members from a particular work area who
work as a team to identify priorities and solve work related problems in the area.
We believe that it is this unwavering commitment to quality that will lead to the
further growth of the organization as competition increases.
ISO 9001:2000
At Maruti, our approach to quality is in keeping with the Japanese practice--"build it into
the product". Technicians themselves inspect the quality of work. Supervisors educate
and instruct technicians to continually improve productivity and quality. The movement
of quality indicators is reviewed in weekly meetings by the top management.
In 2001, Maruti suzuki india Ltd became one of the first automobile companies
anywhere in the world to get an ISO 9000:2000 certification.
AV Belgium, global auditors for International Organization for Standardisation(ISO),
certified Maruti after a four day long audit, covering varied parameters like Customer
Focussed organisation, Leadership, Involvement of

people, Process

System approach to Management, Continual improvement, etc.

approach,

In May 1995, Maruti got ISO 9002 certification. The audit for this covered
quality assurance in production, installation, marketing and sales as well as after
sales services. We were also one of the first companies in the world to pioneer ISO
9000 certification for our dealers.

In October 1993, MUL passed the Conformity Of Production (COP) Audit, which
is based on a European Union Directive. This authenticated our quality systems
and testing facilities for export to Europe.
Their emphasis on total quality has meant that today they are in a position to guide
vendors and dealers in establishing and consolidating their individual quality systems.
This commitment to quality has ensured a consistently satisfying product and worldclass sales and after-sales services.

TS16949:2002

A new feather was added recently in Marutis cap in the

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

ISO 9001:2000

THEORITICALPERSPECTIVE
Consumer is strictly, the ultimate consumer of a product, the ultimate user of a product;
the person who derives the satisfaction or the benefit offered. The
'consumer' is not necessarily the customer, since there are often 'customers' in the
buying/ distribution chain; moreover, the consumer is frequently not the person who
makes the buying decision; for instance, in the case of many household products,
where the housewife may make the purchase but consumption or use is by the whole
family. 'Consumer' is not normally applied to the purchase of industrial goods and
services where the customer is usually a corporate body. Nevertheless, consumable
goods are sold to industry for corporate purposes and the consumers of these goods can
be identified for marketing practice.

Consumer behavior is the study of buying habits or patterns of behaviour of consuming

public either in general or in specific groups.

THE BUYING PROCESS

The complexity inherent in understanding consumer behaviour has led to the
construction of models of the buying process which indicate the stages
through which the consumer passes from the time he or she first becomes
aware of a need for a product or service to the time when a product is
purchased, a brand selected, and the consumer evaluates the success of his purchase
decides whether to buy that particular product and / or brand again. It the same
time, such models usually indicate the social and psychological forces which shape
the potential buyer's action at each stage in the process. The two principal aims
of such model building are the prediction of future behavior

based

on

measurement of relevant variable and the explanation of this behavior in terms

of theoretically relevant constructs.

The starting point for understanding the buyer is the stimulus-response model
shown below
Marketing

Other

stimuli

stimuli

Buyer's
Characterist
ics
Cultural

Buyer's
decision
process
Problem
recognition

Product

Economic

Social

Price

Technologic

Personal

Place

al

Psychological

Promotion

Political

Evaluation
decision

Cultural

Post-purchase
behavior

Information

Buyer's
decision

Product choice
Brand choice
Dealer choice
Purchase timing
Purchase
amount

The consumer passes through five stages : Problem recognition information search,
evaluation of alternatives purchase decision and post-purchase behavior. Clearly
the buying process starts long before the actual purchase and has consequences
long after the purchase.
This model implies that consumers pass through all five stages in buying a product.
But this is not the case, especially in low-involvement purchase. Consumers may
skip or rreverse some stages. Thus a woman buying her regular brand of
toothpaste goes directly from the need for toothpaste to the purchase decision,
skipping information search and evaluation. However, we have already used the
model in above, because it captures the full range of consideration

that

arise

when a consumer facer a highly involving new purchase.

We will allude again to Linda Brown and try to understand how she
became interested in buying a laptop computer and the try to understand how she
became interested in buying a laptop computer and stages she went through to
make her final choice.

MAJOR FACTORS INFLUENCING BUYING BEHAVIOR

Cultural
Social
Reference group
Culture

Family

Subculture
Social Class

Personal
Age and lifecycle stage

Roles and
statuses

Occupation

Psychological
Motivation
Perception
Learning

Economic

Beliefs and

circumstances

attitudes

Lifestyle
Personalit y and
self-concept

Buyer

Rogersmodelfortheadoptionanddiffusionofinnovations Innovation AdoptionCURVE

The innovation adoption curve of Rogers is a model that classifies adopters of innovations into
various categories, based on the idea that certain individuals are inevitably more open to adaptation than
others. Is is also referred to as Multi-Step Flow Theory or Diffusion of Innovations Theory.

Innovators
Brave people, puling the change. Innovators are very important communication.
EarlyAdopters
Respectable people, opinion leaders, try out new ideas, but in a careful way.
Early Majority
Thoughtful people, careful but accepting change more quickly than the average.
Late Majority
Skeptic people, will use new ideas or products only when the majority is using it.

Laggards
Traditional people, caring for the "old ways", are critical towards new ideas and will only accept it if the new
idea has become mainstream or even tradition.

The diffusion of innovations curve (innovation adoption curve) of Rogers is useful to remember that
trying to quickly and massively convince the mass of a new controversial idea is useless. It makes more
sense in these circumstances to start with convincing innovators and early adopters first. Also the
categories and percentages can be used as a first draft to estimate target groups for communication
purposes.

Diffusion research focus was on five elements: 1) the characteristics of an innovation

which may influence its adoption; 2) the decision-making process that occurs when
individuals consider adopting a new idea, product or practice; 3) the characteristics of
individuals that make them likely to adopt an innovation.

TARGETMARKETING
Target Marketing involves breaking a market into segments and then concentrating
your marketing efforts on one or a few key segments.

The beauty of target marketing is that it makes the promotion, pricing and distribution
of your products and/or services easier and more cost-effective. Target marketing is the
selection of customers you wish to service. The decisions involved in it are Which
segments to target How many products to offer Which products to offer in which
segments There are three steps to targeting: Market segmentation Target choice Product
positioning One of the first things you need to do is to refine your product or service so
that you are NOT trying to be 'all things to all people. Next, you need to understand
that people purchase products or services for three basic reasons:To satisfy basic
needs. To solve problems. To make themselves feel good.
The next step in creating an effective marketing strategy is to zero in on your target
market. Target marketing is one of corporate America's most effective business strategies.
The idea is to increase sales by first identifying, and then targeting smaller, yet more
profitable customer groups within the total market.

Four Ways to Identify Target Markets

1. Geographic: The location, size of the area, density, and climate zone of your
customers.
2. Demographics: The age, gender, income, family composition and size,
occupation, and education of your customers.
3. Psychographics: The general personality, behavior, life-style, rate of use,
repetition of need, benefits sought, and loyalty characteristics of your customers.
4. Behaviors: The needs they seek to fulfill, the level of knowledge,
information sources, attitude, use or response to a product of your customers.

One of the best ways to identify your target market is to look at your existing
customer base. Who are your ideal clients? What do they have in common? If you do
not have an existing customer base, or if you are targeting a completely new
audience, speculate on who they might be, based on their needs and the benefits they will
receive. Investigate competitors or similar businesses in other markets to gain
insight.

TARGETMARKETING
Who are your best customers? Where should you direct your marketing activities?

Where and how should you allocate your advertising and promotional efforts
Target Marketing, provides Focus for your business. It helps to establish
critical Operational goals and defines what must be done to achieve them

What Customers Want

Marketing is more than an activity, it is an attitude
Instead of trying to get customers to buy what the firm likes to make, or
happens to have on hand, the marketing oriented firm tries to produce or
sell what its customers want which can be sold at a profit. Do not simply throw out
everything that you now have and replace goods or production machinery with
completely new items.
Customer Attitudes
For a long time, people have believed that advertising can be used to change people's
minds about what they want. This is an incredibly difficult process at best, and an
extremely expensive one. Because of these two factors, it is a process that smaller firms
simply cannot afford to pursue. Instead, it is much more productive for any size firm to
tune in to target customer attitudes as they currently exist. Once they have identified the
actual prevailing attitudes, they can begin to organize company resources needed to
constructively address and satisfy these attitudes the key question is,
"What are the existing customer attitudes?

With this as an objective, developing an understanding of existing customer

attitudes becomes essential, and their identification becomes an important part of
the marketing process. Once these customer attitudes, needs or preferences are
identified, the entire firm can then organize itself to satisfy these needs as
completely and efficiently as possible.

Target Marketing

MARUTICULTURE
Their employees are their greatest strength and asset. It is this underlying philosophy that
has moulded their workforce into a team with common goals and objectives. Their
Employee-Management relationship is therefore characterized by:
Participative Management. Team work & Kaizen. Communication and information
sharing. Open office culture for easy accessibility To implement this philosophy, they
have taken several measures like a flat organizational structure. There are only three
levels of responsibilities ranging from the Board Of Directors, Division Heads to
Department Heads. Other visible features of this philosophy are an open office,
common uniforms (at all levels), and a common canteen for all.
This structure ensures better communication and speedy decision making processes. It
also creates an environment that builds trust, transparency and a sense of
belonging amongst employees.
For Investors:
Maruti Udyog Limited, a subsidiary of Suzuki Motor Corporation of Japan, has been the
leader of the Indian car market for about two decades. Its manufacturing plant, located
some 25 km south of New Delhi in Gurgaon, has an installed capacity of
3,50,000 units per annum, with a capability to produce about half a million vehicles.

The company has a portfolio of 11 brands, including Maruti 800, Omni, premium small
car Zen, international brands Alto and WagonR, off-roader Gypsy, mid size Esteem,
luxury car Baleno, the MPV, Versa, Swift and Luxury SUV Grand Vitara XL7.
In recent years, Maruti has made major strides towards its goal of becoming Suzuki
Motor Corporation's R and D hub for Asia. It has introduced upgraded versions of
WagonR Zen and Esteem, completely designed and styled in-house.

Maruti's contribution as the engine of growth of the Indian auto industry, indeed its
impact on the lifestyle and psyche of an entire generation of Indian middle class, is
widely acknowledged. Its emotional connect with the customer continues.
Maruti tops customer satisfaction again for sixth year in a row according to the J.D.
Power Asia Pacific 2005 India Customer Satisfaction Index (CSI) Study.
The company has also ranked highest in India Sales Satisfaction Study.

The company's quality systems and practices have been rated as a "benchmark for the
automotive industry world-wide" by A V Belgium, global auditors for International
Organisation for Standardisation.
In keeping with its leadership position, Maruti supports safe driving and traffic
management through mass media messages and a state-of-the art driving training and
research institute that it manages for the Delhi Government.
The company's service businesses including sale and purchase of pre owned cars
(TrueValue), lease and fleet management service for corporates (N2N), Maruti
Insurance and Maruti Finance are now fully operational.. These initiatives, besides
providing total mobility solutions to customers in a convenient and transparent manner,
have helped improve economic viability of The company's dealerships.
The company is listed on Bombay Stock Exchange and National Stock Exchange.
MUL is a Board-managed company. Currently the directors on the Board are:

Mr Shinzo Nakanishi, Chairman

Mr Jagdish Khattar, Managing Director

Mr Hirofumi Nagao, Joint Managing Director

Mr Shinichi Takeuchi, Joint Managing Director
Mr Kinji Saito, Director (Marketing and Sales)
Mr Osamu Suzuki, Director

Mr R C Bhargava, Director

OBJECTIVE OF THE COMPANY

Marutis marketing objective is

to

continually offer

the customer new

products and services that:

Reduce the customer s cost of ownership of their cars; and anticipate
and address the customer s needs and preferences in all aspects
and stages of car ownership, to provide what they refer to as the
360 degree customer experience.
They sell ten models with more than 50 variants in segments A, B, C, and
utility vehicle segment of the Indian passenger car market. Of these, they
manufacture nine models and import the Grand Vitara as a completely built
unit from Suzuki in Japan. Their models and variants are designed to address the
changing

demands

of

the

market

and

are

periodically

upgraded

in

technology, styling and features. To take advantage of the brand recognition

associated with their products, they retain the brand name of the product
through various stages of product upgrades over time. For example, the
version of the Maruti 800 brand currently sold in the market is a significantly
upgraded version, in terms of technology, design and styling, of the Maruti
800 launched in 1983.

BALENO

WAGONR

ESTEEM

MARUTI800

NEW ALTO

SWIFT

OMNI

ZEN

RESEARCH METHODOLOGY

The nature of the project work has been explorator y as no h ypothesis, is

taken to be tested. Though

the conclusions drawn could be taken as the h

ypothesis and further tested b y the research work undertaken in the

relevant field. The reason for choosing the exploratory research design is the
fact the project report has been primaril y based upon the secondar y sources
of data and whose authenticity could be assured of.

The reluctance of the company's personnel in parting with

much of

information led the project report to be based substantially on the

secondar y source of data. The sources of data used in data collection are the
following:

Primary sources

In order to gather information about the various products, I personall y

visited a number of retail markets and collected data pertaining to the
prices of the products offered. The market visits were useful in knowing the
comparative

prices

and

qualit y

of

the

offered

brands

vis--vis

the

competitive brands. Detail regarding the packaging of the products were

collected were collected and I also inquired about the various sales
promotion schemes followed b y the three companies.

B y interviewing these retailers valuable information was

collected. I

inquired from them about their marketing advertising and distribution strategies.

FINDINGS OF THE STUDY

PRICES OF MARUTI PRODUCTS

Car market leader Maruti Udyog Limited has announced a marginal increase in price of
certain models. The increase, which comes into effect from today, varies from
0.17 percent to 1.47 percent.

The price increase is due to rise in input costs and freight costs, which
increased following the rise in oil prices.

In this phase, the company has

decided to pass on only a part of the increase in costs to the customers. There is
no change in the prices of Swift, Zen, Baleno (Vxi) and WagonR (Petrol).
Ex-Showroom Prices in Delhi (in Rs)
Model
M800 Std
M800 Std Ac
Alto Std
Alto Lx
Alto Lxi
Omni Cargo LPG
Omni Cargo
Omni (Eight Seater)
Omni LPG
Esteem Lx
Esteem Lxi
Esteem Vxi
Baleno Lxi
Versa Dx
Versa Dx2
Versa Std
WagonR Lx LPG
WagonR Lxi LPG

New
191646
213062
231585
265262
283878
194725
213706
221268
230388
445968
476223
511520
576173
433575
471779
360182
345106
373160

Change
Old
Increase
%
191146 500
0.26%
212562 500
0.24%
231085 500
0.22%
264762 500
0.19%
283378 500
0.18%
192725 2000
1.04%
213206 500
0.23%
220768 500
0.23%
227388 3000
1.32%
444968 1000
0.22%
475223 1000
0.21%
510520 1000
0.20%
575173 1000
0.17%
432575 1000
0.23%
470779 1000
0.21%
359182 1000
0.28%
340106 5000
1.47%
368160 5000
1.36%

INTERNATIONAL BUSINESS

In August, 2003 Maruti crossed a milestone of exporting 300,000 vehicles since its first
export in 1986. Europe is the largest destination of Marutis exports and coincidentally
after the first commercial shipment of 480 units to Hungary in 1987, the 300,00 mark
was crossed by the shipment of 571 units to the same country. The top

ten

destinations of the cumulative exports have been Netherlands, Italy, Germany,

Chile, U.K., Hungary, Nepal, Greece, France and Poland in that order.

The Alto, which meets the Euro-3 norms, has been very popular in Europe where a
landmark 200,000 vehicle were exported till March 2003. Even in the highly developed
and competitive markets of Netherlands, UK, Germany, France and Italy Maruti
vehicles have made a mark. Though the main market for the Maruti vehicles is Europe,
where it is selling over 70% of its exported quantity, it is exporting in over 70
countries.

Maruti has entered some unconventional markets like Angola, Benin, Djibouti,
Ethiopia, Morocco, Uganda, Chile, Costa Rica and El Salvador. The Middle-East
region has also opened up and is showing good potential for growth. Some markets in
this region where Maruti is, are Saudi Arabia, Kuwait, Bahrain, Qatar and UAE.

The markets outside of Europe that have large quantities, in the current year, are
Algeria, Saudi Arabia, Srilanka and Bangladesh. Maruti exported more than 51,000
vehicles in 2003-04 which was 59% higher than last year. In the financial year 200304 Maruti exports contributed to more than 10% of total Maruti sales.
x

Modellwise Exports Sales

Versa:0_07x
Car 800: 20X
Baleno t.: Esteem:O_GX

OMNI:2X

MARUTI ALL INDIA SALES 3 YR TREND

Segment

2003- Growth 2004-05

Growt 2005-06

A1 (Mini - Hatchback)
A2 (Compact - Hatchback)
A3 (Mid Size)
A4/A5/A6

04
167,561 17%
176,132 47%
14,173 28%
NA
NA

116,262 -31%
271,280 54%
109%
29,637
NA NA

(Exec./Prem./Luxury)
C (Van Type)
Passenger Cars MUL

59,526 15%
417,39 28%

9%
65,019
482,198 16%

66,366 2%
522,664 8%

2
758,12 26%

885,029 17%

948,669 7%

3
12%
3,555
420,94 28%

46%
5,204
487,402 16%

-16%
4,374
527,038 8%

7
901,15 24%

1,050,2 17%

Passenger Cars - Total

Industry
MUV (Utility Vehicles)
Passenger Vehicles MUL
Passenger Vehicles - Total
Industry

46

Growt

89,223 -23%
335,136 24%
31,939 8%
NA NA

1,129,3 8%
16

MARKETSHARE

2005-06 Market Share-Segment A2

TATA 20%

HYUNDAI

MARUTI

21%

59%

2005-06 Market Share-Segment A3

HYUNDAI

TATA

16%

20%

MARUTI
17%
FORD
14%
OTHERS
7%

GM
HONDA
20%

6%

COMPETITION MODELS

SEGMENT
A1 (Mini - Hatchback)
A2 (Compact Hatchback)
A3 (Mid Size)

Maruti

Competition

M800
Zen, WagonR,
Alto, Swift

Hyundai - Santro & Getz; Tata Indica & Palio; GM - Corsa Sail

Esteem,

Hyundai - Accent; Tata - Indigo &

Baleno

Petra; Honda - City; GM - Corsa,

Optra, & Aveo; Ford - Ikon, Fusion,
& Fiesta& Sonata;
Hyundai - Elantra

A4/A5/A6
(Exec./Prem./Luxury)

Honda - Accord; GM - Vectra; Ford

- Mondeo; Skoda - Octavia &
Superb; Toyota - Corolla & Camry;

C (Van Type)
MUV (Utility
Vehicles)

Omni, Versa
Gypsy, Grand
Vitara

Daimler Chrysler - C,E, & S Class;

Mitsubishi - Pajero; Hyundai Terracan & Tucson; Ford Endeavor; Toyota - Prado & Innova;
Nissan - X Trail; Honda - CRV; GM
- Forrester & Tavera; Tata - Sumo
& Safari; Mahindra - Jeeps,
Scorpio, & Bolero

COMPETITIVE STRENGTHS
MUL believes that they are well positioned to maintain and enhance their leadership
position in the small car segment in India, while continuing to offer products in most
segments of the Indian market, on account of their competitive strengths, which include
the following:
Expertise in small car technology: As a subsidiary of Suzuki, they have
access to globally respected technology in the small car segment. They have the
advantage of Suzukis expertise in all aspects of small car technology and design,
with respect to their products, their manufacturing processes and business
practices, the development of their supply chain and the training of their
personnel.
Extensive product portfolio: Their diverse product range includes cars in
segments A, B and C, and utility vehicles. They manufactured five out of the ten
models that were sold in the combined A and B segments in India in fiscal
2002. They are the only manufacturer of cars in segment A (priced below
Rs.300,000) where they have two models, the Maruti 800 and the Omni. The
Maruti 800 has been the largest selling car in India for several years, and continued
to have the highest sales volumes of any model, with a market share of 25.3%.
The Omni, a versatile vehicle that can seat more passengers than the Maruti
800 or be used as an ambulance or cargo vehicle, had a market share of
10.5% in fiscal 2002. They are also the only manufacturer to sell three
distinct models, the Zen, the Alto and the Wagon R, in segment B (priced
between Rs.300,000 and Rs.500,000). They believe that theirdominance in
segment A and extensive product range in segment B enables us to offer the
customer a wider choice in the small car segment than any of their competitors.
Quality products: In November 2001, they were one of the first automobile
manufacturers in the world to receive the ISO 9001:2000 certification. They began
to export products in 1988, primarily in order to benchmark our products
against international quality standards. They have exported products to
approximately 70 countries, including countries in Western Europe. Their products
for export are manufactured using the same assembly line as our products for the
domestic market.

Extensive sales and service network: They believe that they have the largest
network of dealers and service centers amongst car manufacturers in India. As of
March 31, 2003, we had 178 authorized dealers with 243 sales outlets in
161 cities. They estimate their car parc to be in excess of 3.5 million vehicles. To
service this car parc, at March 31, 2003, they had 342 dealer workshops and
1,545 Maruti Authorized Service Stations, or MASSs, which covered 898 cities in
India backed by Express Service Centers on 30 highways across the country. In
addition to the distribution of their cars, their dealership network is a critical
resource in our efforts to provide customers with a one-stop shop for
automobiles and automobile related products and services such as automobile
finance, automobile insurance, Maruti-certified pre-owned cars available for
purchase, and leasing and fleet management, in order to promote customer
loyalty.
Brand strength: They have been present in the Indian market for almost
twenty years and have built their brand on the basis of the values of trust and
reliability. Most of their principal competitors have been present in the Indian
passenger car market for a significantly shorter period. Certain manufacturers have
ceased to manufacture certain products shortly after introducing them, or have left
the market altogether. In contrast, they continue to support the maintenance of
their products. This has contributed to the strength of their brand. In 2000,
2001 and 2002, J. D. Power Asia Pacific, Inc. ranked us No. 1 in the India
Customer Satisfaction Index, which assesses customer satisfaction

with product quality and dealer service. They believe that this was the first
time that a volume leader in the automobile industry anywhere in the world
was ranked first on the JD Power Customer Satisfaction Index. NFO Automotives
2002 Total Customer Satisfaction Survey ranked Maruti products as No. 1 in the
Economy, Premium Compact and Entry Midsize segments respectively,
for 2002.
Integrated manufacturing facility: Their manufacturing facility comprises three
integrated plants with flexible assembly lines located at Gurgaon in the northern
state of Haryana. Their facility has advanced engineering capability and each
plant is upgraded on an ongoing basis to improve productivity and quality. As a
result, their first plant set up in fiscal 1984 is technologically at par with their
newer plants and is also used in the production of their new models. They believe
that they are one of the most efficient among the vehicle manufacturing facilities of
Suzukis subsidiaries outside Japan in terms of productivity measured as the ratio
of number of vehicles produced to number of employees. They have an installed
capacity of 350,000 vehicles per year, which is the highest among passenger car
manufacturers in India and among the passenger car manufacturing facilities of
Suzukis subsidiaries outside Japan. They have consistently produced in excess of
their installed capacity in the five fiscal years ended March 31, 002.
They believe that they would be able to expand their production to 500,000
cars per year with minimal additional capital expenditure. This would enable
them to benefit from significant economies of scale.
Strong vendor base and higher rates of localization: They work closely
with their vendor base for the supply of raw materials, components and spare
parts of their products. In order to improve quality and generate economies of scale,
they have reduced the number of their vendors of components in India from 370 as
of March 31, 2000 to 299 as of March 31, 2003, and intend to continue to reduce
the number of our vendors.

113 of their vendors at March 31, 2003 were in technical collaboration with
foreign entities. As of the same date, we had strategic equity interests through
joint venture agreements in 13 of their vendors, who together supply a
substantial portion of their purchases of components. A number of their vendors
are their dedicated suppliers in that they account for a majority of their turnover.
Vendors located within a radius of 100 kilometers from their facility supply the
majority of their components. The production systems of their vendors are
generally aligned to their need for a reliable and timely supply of components that
meet their quality requirements. This has enabled them to increase the proportion
of locally sourced, lower cost components in their models, a concept they refer to as
localisation. They have been able, in collaboration with their vendors, to
increase the rate at which they are able to localise production of their new
models over time. This has helped them reduce the cost of their components.
Skilled labour and experienced management: Thei highly skilled labour force has
become

increasingly

productive

in

terms

of

vehicles

produced

per

employee and receives training on an ongoing basis, including training by Suzuki.

As of March 31, 2003, 1,900 of their employees had been trained at Suzukis
facilities in Japan. They have been present in the Indian passenger car market
for a significantly longer period than most of their principal competitors. As a
result, they have been able to build a highly experienced management team that is
familiar with conditions in the Indian passenger car market. For instance, their
managing director has almost ten years of experience with them, and most of
the heads of their divisions have more than
15 years of experience with them.

Capital resources: They have cash and bank balances and current investments
amounting to Rs.9,992 million. As of the same date, they had relatively low
levels of outstanding indebtedness, in the amount of Rs.4,555 million. As a result,
they have relatively low interest expense and flexibility to raise funds, if
necessary, for their working capital and capital expenditure in the future.

BUSINESS STRATEGY

They intend to continue to focus on the small car segment, while offering products
in most segments of the Indian passenger car market. They aim to achieve

their

principal objectives by pursuing the following business strategies:

Maintain and enhance their product range: They intend to utilize Suzukis
expertise in small car technology to produce new variants of their existing models
and to upgrade their products with contemporary technology and features.
Increase reach and penetration: They plan to continue to utilize their
extensive sales and service network to increase the reach, in terms of geographical
spread, and penetration, in terms of sales volumes, of their products across
India.
Increased availability

of

automobile finance: They continue to

seek

opportunities to expand the size of the Indian passenger car market, especially in
the small car segment, through facilitating easy availability of automobile
finance. To that end, they have recently entered into an agreement with the
State Bank of India.
Secure repeat purchases by offering a 360 degree customer experience: On
the basis of their belief that securing repeat purchases from an existing customer
requires less expenditure than acquiring a new customer, they aim to provide
customers with a one-stop shop for automobiles and automobile- related products
and services.
Continue to benchmark their manufacturing capabilities: They plan to continue
to benchmark our manufacturing capabilities with the most efficient car
manufacturing facilities of Suzuki and its subsidiaries.

Continue to reduce costs to offer more competitive products:

Cost competitiveness has been, and continues to be, central to their strategy as the
leading manufacturer in the small car segment to expand the size of the market
by offering competitively priced, high quality products. The components of
this strategy are:

Higher levels of localization

Vendor participation in cost reduction

Cost reduction on warranties Reduction
in initial investment cost

Reduction in number of vehicle platforms

Achieve further cost reduction through higher productivity

Lower cost of ownership:

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

SALES NETWORK
Dealers: They offer their products to the customer through a network of 178
authorized dealers with 243 sales outlets across 161 cities. They believe that this
is the largest network of dealers amongst car manufacturers in India. Their
dealers employed more than 3,500 sales executives. They are linked to their
sales network through their secure extranet-based information network. The
sales of their spares, accessories and automobile-related services such as
insurance and finance serve as additional sources of revenue for our dealers. They
believe that the availability of these related products and services at sales
outlets also helps to attract customers to the outlets and promotes sales of their
cars.
Agreements with dealers: They generally appoint a limited number of dealers for
a

certain

geographical

territory.

Their

dealers

provide

services

to

customers such as pre-delivery inspection of vehicles, sales of cars, after sales

service, supply of spare parts and other services that promote sales of cars
within the territory for which they are appointed. They have the right to sell
their products and services through other dealers or intermediaries in any territory,
whether or not one of their dealers is already established in that territory. Their
dealers are

required to

maintain their

outlets in

accordance with their

specifications and employ well-trained sales staff.

Their agreements with their dealers usually have terms of five years. These
agreements are generally renewable for successive terms of three years, by mutual
agreement. The agreements typically permit termination by either the dealer or
them with six months prior notice.
Enhancing dealer performance: Their central office in Delhi, their regional offices
and their area offices monitor and assist their dealer network. They have nine
regional offices, five area offices and 187 sales and marketing personnel. They
follow

the

performance

of

their

dealers

and

frequently suggest

improvements. In order to assist their dealers in enhancing their performance and

capabilities, they have introduced a concept of Balanced

Scorecard. Using this tool, they seek to measure the performance of a

dealership in several areas of operations, including sales, service, spares and
accessories, financial management and management systems. They reward dealers
who perform well on the Balanced Scorecard with a cash payment at the end of
the fiscal year. They believe that the Balanced Scorecard serves as an effective
incentive for dealers to enhance their performance.
Dealer training: They have established standard operating procedures, showroom
ambience

and

service

quality

standards

for

dealerships.

They provide

periodic training through their training centres located at their manufacturing

facility and at Chennai, Kolkata, Guwahati and Pune. They have

trained

more than 2,600 and 3,400 dealer sales personnel. Their subsidiary, True
Value Solutions Ltd., provides value-added services, such as manpower
recruitment and training, to their dealers.

AFTER-SALES SERVICE
Network
As on date there are 342 Maruti dealer workshops and 1,545 Maruti
Authorised Service Stations, or MASSs, covering 898 cities in India. In
addition, 24-hour mobile service is offered in 38 cities under the brand
Maruti On-road Service. They intend to extend this service to an additional
25 cities over the next three years. As a benchmark for dealers with respect to
service quality and infrastructure facilities, they have launched service
stations under the brand Maruti Service Masters, or MSMs, in three locations in
India. They have service stations on 30 highways in India under the brand
Express Service Stations.
To promote sales of their spare parts and the availability of high quality,
reliable spare parts for their products, they sell spares under the brand name
Maruti Genuine Parts, or MGP. These are distributed through their dealer
network and through authorised sellers of their spare parts, to whom they
refer as stockists.

Many of their MASSs are at remote locations where they do not have dealers. In
order to increase the penetration, in terms of sales volumes, of their products
in these remote areas, they are exploring opportunities to integrate some of the
MASSs into the sales process in order to increase sales of their cars

and

related products and services such as spares and accessories, insurance and
financing.
Genuine Accessories

They have also entered the business of marketing car accessories under the
brand name Maruti Genuine Accessories, or MGA, through their dealership
network. They seek to provide customers with the opportunity to customize
their vehicles with accessories such as music systems, security systems, carcare products and utility products.
Warranty and Extended Warranty Program

They offer a two-year warranty on all their vehicles at the time of sale. Their
dealers are required to address any claim made by a customer, in accordance
with practices and procedures prescribed by them, under the provisions of the
warranty in force at that time. The dealers subsequently claim the warranty
cost from them. They analyse warranty claims from dealers and either claim the
cost from vendors, in the case of defective components, or bear the cost ourselves,
in the case of manufacturing defects.
They offer an extended paid-warranty program marketed under the brand, Forever
Yours for the third and fourth year after purchase. They have entered into
arrangements with insurance companies to cover the costs of warranties offered
under this program. The extended warranty program is intended to maintain the
dealer s contact with the customer and increase the revenue generated from sale
of spares, accessories and automobile-related services. An effort is made during
the period of the extended warranty to encourage the customer to exchange his
existing Maruti car for a new Maruti car, or upgrade to a new Maruti car.

NEWBUSINESSINITIATIVES
As the largest manufacturer and leader in the small car segment, they continually
seek new ways to utilize their vast car parc, range of products and extensive sales and
service network to expand the size of the passenger car market in India. They have
recently launched new initiatives to develop the market for automobile insurance,
automobile finance, leasing and fleet management, and pre-owned cars. They aim to
provide customers with a one-stop shop for automobiles and automobile-related
products and services, and build on their wide customer base and extensive sales and
service network to make available to their customers a wide range of Maruti-branded
services at different stages of ownership, which they refer to as the 360 degree
customer experience.
Atithi Devo Bhava: One-stop shop

Inspired by the spirit of India. Atithi Devo Bhava, in Sanskirit, means a guest is like
God. It captures the Indian tradition of honouring guests. It's also the inspiration for the
welcome

youll

receive

at

Maruti

Suzuki

dealership,

and

the

caring

relationship they share with those who drive their cars. At Maruti Suzuki, you will find
all your car related needs met under one roof. Whether it is easy finance, insurance,
fleet management. services, exchange Maruti Suzuki is set to provide a single window
solution for all your car related needs.
That's why they have Maruti True Value, the best place to buy and sell reliable used
cars. Maruti Finance an agglomeration of the biggest finance companies in India
brought together by Maruti Suzuki to ensure that the dream car is within
everyone's reach. Similarly, Maruti Insurance brings together some of the
biggest names in the car insurance industry to provide insurance solutions to
every type of car consumer. Then, finally, there is N2N, which offers fleet
related solutions.

THE PLAYERS IN THE INDIAN AUTOMOBILE INDUSTRY

Hyundai Motor India Ltd

Hyundai Motor India Limited (HMIL) is a wholly owned subsidiary of Hyundai Motor
Company, South Korea and is the second largest and the fastest growing car
manufacturer in India. HMIL presently markets 31 variants of passenger cars in six
segments. The Santro in the B segment, Getz in the B+ segment, the Accent in the C
segment, the Elantra in the D segment, the Sonata Embera in the E segment and the
Tucson and Terracan in the SUV segment.

The company recorded combined sales of 252,851 during calendar year 2005 with a
growth of 17.26% over year 2004. HMIL is India's fastest growing car company
having rolled-out over 970,000 cars in just over 80 months since its inception and is the
largest exporter of passenger cars with exports of over Rs. 1,800 crores. HMIL has
recorded a growth of 27.2% in exports over the year 2004.

HMILs fully integrated state-of-the-art manufacturing plant near Chennai boasts some
of the most advanced production, quality and testing capabilities in the country.
In continuation of its investment in providing the Indian customer global technology,
HMIL has announced plans for its second plant, which will produce
300,000 units per annum, raising HMILs total production capacity to 600,000 per
annum by 2007. The plant will be built on a 2.1 million square meter site adjacent to the
existing facility .HMIL is investing to expand capacity in line with its
positioning as HMCs global export hub for compact cars. Apart from expansion of
production capacity, HMIL plans to expand its dealer network, which will be increased
from 157 to 200 this year. And with the companys greater focus on the quality of its
after-sales service, HMILs service network will be expanded to over
1,000 in 2006.

The year 2005 has been a significant year for Hyundai Motor India. It achieved a
significant milestone by rolling out the fastest 200,000th export car. HMIL exports
to around 60 countries globally and recently made a foray into the highly
competitive UK market by exporting its first shipment of 820 cars.
Propelled by the strong performance in year 2005, Hyundai Motor India is on the
threshold of yet another grand milestone of rolling out its One millionth car which is
expected soon.

Tata Motors

Tata Motors is one of the largest companies in the Tata Group with a total
income of US$ 2.35 billion. More than 3 million Tata vehicles ply on Indian
roads making Tata a dominant force in the Indian automobile industry.
Tata Motors is India's only fully integrated automobile manufacturer with a
portfolio that covers trucks, buses, utility vehicles and passenger cars. It
would be no exaggeration to say that Tata Motors provides the wheels for
India's growth.

Tata Motors has the unique distinction of giving India its first and only indigenously
built passenger car - The Tata Indica and the premium feature sedan - The Tata Indigo.
The Indica, launched in 1998, reached the 2,50,000 sales mark within 52 months
of

launch.

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

Ford India Limited

The Ford Motor Company has a rich legacy of translating better motoring ideas to the
roads. It has manufactured notable brands such as the Ford, Lincoln, Mercury and the
Jaguar. It is among the top five industrial corporations in the world and is available in
more than 200 countries around the world.

Ford has entered the Indian market through a tie - up with Mahindra Motors to
manufacture the Ford Escort. A project that has been set up with a investment of
Rs.1700 crore. Ford India Limited is a subsidiary of Ford Motor Company, currently
Ford has a 78% stake, which is going up to 92% soon. The Maraimalai Nagar Plant of
Ford India Limited, located roughly 45k.m.from Chennai, provides employment to
over 20000 people.The plant has the capacity to manufacture 1,00,000 vehicles per
annum, equipped with state-of-the-art vehicle manufacturing technology from Ford.
Presently offering seven different models, Ford India Limited (FIL) is catching up fast
with the Indian consumer. This is secured through a quality check program based
on the principles of NOVA - C (New Overall Vehicle Audit - Customer) wherein daily
random checks are conducted from a customer's point of view. To be doubly sure,
routine calls are made to dealerships to check the quality of cars delivered to them.

At Mahindra's dealerships are present trained professionals who provide the

best levels of service in India. Its intensive manpower training, advanced
service equipment and dedicated consumer satisfaction are the are its plus
points which is being followed by the entire industry.

Acknowledgement has come in the form of the J D power 1997 India Initial Quality and
Customer Satisfaction Awards. These internationally acclaimed and recognized awards
voted the Ford Escort as the Best Quality car and the Mahindra Ford and its dealerships
were rated the highest in Customer Satisfaction. This is an honour as it its only the
second time in automotive history that the same brand/manufacturer has received both
the awards in the same year.

General MotorsIndia
General Motors India, incorporated in 1994 as a 50-50 joint venture company with the
C.K. Birla Group of Companies, became a fully owned subsidiary of GM in
1999 when GMOC bought the remaining shares. The company was restructured in
1999 and was converted from a Public Limited company to a Private Limited company.
GM APH LLC currently holds 86 percent of voting shares, and Holden (Australia)
holds 14 percent. The SPO business was integrated with the main business in the
same company in 2000.

In India, GM strengthened its presence with new product launches Chevrolet Optra in
2003 and Chevrolet Tavera (Multi Utility Vehicle) in 2004. Similarly in 2004, GM India
is expected to register a growth of 90% over 2003. With sales volume going up, the
market share of GM India has gone to nearly 2%. The sales volume in 2003 was 15,155
units while 2004 figure is expected to be around 27,000 units. In 2004, the company
sold a total of 26,166 cars as against 15,155 cars in 2003 registering a growth of 73%
while overall passenger car growth during the year was only around
23-24%. These included 9191 Chevy Optras in Entry 'D' Luxury sedan segment,
8369 Opel Corsas and 8417 units of the new generation premium multi-utility
vehicle (MUV) Chevrolet Tavera.

The existing GM India plant was originally built by Hindustan Motors. In 1994, GM
India entered into a 50% Joint Venture partnership with Hindustan Motors and
modernized the 45,000-square-meter plant near Halol, 45 kilometers northwest of
Vadodara, in the western state of Gujarat. In February, 1999, GM bought the
holdings of Hindutan Motors and GM India became a 100% subsidiary of General
Motors Corporation of USA. The plant produces the Opel Corsa, Corsa Sail, Chevrolet
Optra, and Chevrolet Tavera. The Chevrolet Forester and Opel Vectra are sold as CBUs
(Completely Built in Units) and as imported from Japan and Germany respectively.

Toyota Motor Corporation is the third largest automaker in the world. They
have 34 dealers in India and in Delhi they have 2 dealers, first one is South

Delhi Toyota and second one is in Moti Nagar in which I have visited during my
survey. Dealer in Moti Nagar which is Galaxy Toyota have predetermined
mission that-Customer comes first and everything they do is to meet

their

customer needs, basically they work for creating a lifetime customer.

They work by dividing their work like in one showroom they have separate teams
for every product like relating to Corolla it comprises of 7 or 8 executives
who handle all the work weather it is of sale or any enquiry or telemarketing call
that team must have some specific target to achieve. They reach to the customers
either by distributing Leaflets, Brochures to the customers. They collect customer
database from Directory (Yellow Pages) or through customer references even they
solve customers query online and give information through e-mails. Recently
they organized one drawing competition between the kids of their existing
customers just to interact with the customer and build loyalty of their company
products. They judge their customer satisfaction by analyzing that repeat buyers are
more or not & moreover they have customer feedback form in which they can
analyze customers background and can forecast customer future demands. They
target only high profile customers.

They build customer loyalty by giving happy calls to the customer after sale of
every 1,3,7 month. They provide Periodic maintenance schedule, which will
ensure

that

vehicle,

is

kept

in

best

able-bodied

at

all

times.

The

maintenance schedule may include periodic inspection, adjustment and lubrication

that will keep vehicle in the safest and most efficient condition, they provide
one booklet in which they give simple and useful tips for maintenance of the car.
They offer good schemes like providing free Test Drive worth Rs 250 petrol at
the time of sale of any car.

They do road shows to attract customers. To promote their product they organize
exchange mela, events, various cash discounts like currently they are running one
discount scheme on purchase of any of their car (Innova, Toyota) they are
giving free accessories worth Rs15000. They provide 4 free services after sale
and with full clean diesel.
All employees of Galaxy Toyota shall consider how they should act and how
they might change their ways to benefit the company. They launch one Co Branded
Credit Card to provide additional benefits and services to the Toyota customers.
This Credit Card will give Toyota customers a better payment flexibility and
convenience, like Customer gets free service voucher with the card, Special
Invite to co-sponsored events, Personal accident insurance coverage: Up to 20
lakhs etc. They have one Guest Book in which they store valuable comments of
customers, which they think are very important for them, which will help them
to improve their service.

HONDA
Honda is one of the leading manufacturers of automobiles and power products and the
largest manufacture of motorcycles in the world. They have 20 dealers in 42
different cities around India. In New Delhi they have 6 dealers, I have visited one of
them, which is in Najafgarh Road.

They do surveys to know customers need. They target either existing or their
perspective customers by giving advertisement in the newspaper or through there
satisfied customers which give references. They dont believe on targeting competitors
customers because by not doing so they have such a brand reputation with good quality
products, only through this they are able to make good sales.

They display their models in 8th Auto Expo, which held in New Delhi. They are
now focusing on their new model Civic. Honda's Civic perhaps drew the
maximum attention. The reason is simple: Civic is a new car from the house of
Honda. During my survey I get to know that Honda City Model is the
second largest selling car in the C segment. They have a good superiority
with superior brand name in the country.

They prefer to have mode of communication with the customer through mail,
telephone and sometimes by letter. Customers who dont have time even to see
the model or to call the dealer to make inquiries about their reservation they
desire to solve their query online itself.

To judge customer satisfaction they some times invite their customers to have a get
together, to have interaction with customer in a minute to know that are they
satisfied with their services and what they are expecting from them in the near
future. They make maximum of their sales from the fresh customers rather than their
repeat purchasers. To increase their sales they try to extort surreptitious information
from the customers and on their end they aim to ensure that the product quality and
product quantity should be available in required quantity in their dealership.

They have Feedback form in which they take feedback of the customer as well as their
salesperson because through this they are able to get the information of both the
customer & their salesperson that are they giving the full information to the customer.
This Dealership even provide technical skills and techniques to their employees that
how

to

deal

with

the

customer

thoughtfully

every

after

months.

NEEDFORCRMINAUTOMOBILEINDUSTRY
The global automotive industry exhibits most of the characteristics of mature industries
and closely follows their business cycles. While vehicle industry sales have been
strong for the past several years, they have started to slow recently due to the current
global economic slowdown. Deteriorating economic conditions result in a drop in
consumer confidence, which quickly impacts automotive sales due to their big-ticket
status and the relative low cost of extending the life of an existing vehicle through
maintenance and repair.

The advent of the Internet as a research tool (75 to 80 percent of auto consumers
research using the Internet) has shifted power to consumers, further increasing pressure
on prices. At the same time, government regulation and consumer demands for
sophisticated features have increased development, production, and marketing costs.
Regional economic fluctuations favor consolidation among car companies, suppliers,
and retailers -resulting in fewer, larger companies that have more complete
product lines targeted at existing and new markets. Consolidation has heightened
competition in all vehicle segments. Low-cost manufacturers are expanding beyond
their

home

markets

with

entry

level

vehicles,

traditional passenger car

manufacturers are expanding into the light truck markets, and luxury manufacturers are
moving down market with passenger cars and SUVs. As a result of these product and
market extensions, consumers find it difficult to exhibit brand loyalty because vehicles
have unclear brand identities, similar features, and comparable prices. In addition, an
overpopulation of dealers has resulted in local and regional competition among same
make dealers. This further reduces margins and damages the brand images the car
companies spend large amounts of money to build.

Relations between the car companies and their suppliers traditionally have been
difficult. In response to competitive pressure, suppliers have been forced by the car
companies to provide higher-quality components at constantly lower costs. The
resulting decrease in margins and the reduction in volume due to slowing sales have

increased the pressure to consolidate and forced some suppliers to the brink of
bankruptcy. Dealers too have a long history of adversarial relationships with the car
companies. Independent entrepreneurs who view some of the car companies with
skepticism or serious mistrust, dealers believe that many manufacturer-sponsored
customer satisfaction programs are actually designed to force smaller dealers out of
business or to gain control of customer relationships that the retailers believe they
"own."

These difficult relationships have prevented car companies and dealers from
maximizing the lifetime value of their combined customers. There are few
incentives or efficient methods for dealers and car companies to share critical data,
resulting in ineffective management of product, service, and household information. In
addition, consumers receive conflicting marketing communications from the two
groups, which results in reduced brand value.

KEY INDUSTRYPAIN POINTS

Decreasing sales and market share - The long-term battle for market share
continues to intensify. In the mature automotive industry, where business cycles
drive sales fluctuations, market share is critical to survival. Consumers are less
brand-loyal than in the past, and every market

segment

has

an

increasing

number of vehicle choices. To increase sales and gain ground in the market
share battle, companies must improve their ability both to acquire first-time
customers and to develop customer loyalty to their current brands. To achieve
these related objectives, companies must set an aggressive goal -deliver the best
customer experience in the automotive industry.
Difficult dealer relationships and a lack of dealer collaboration - As the
consumer 's primary touch point ,the dealer network is a critical component of
customer-facing operations. Therefore, the integration of the dealer network is
absolutely essential to improving the quality of the customer experience. Only
with

an

infrastructure

that

enables

the

buying

cycle.

Lack of multichannel capabilities - With the advent of the Internet as a research

tool, the majority of customers are accessing the automotive enterprises through
several different channels. Many times, the switch between channels happens very
rapidly as a prospect or customer can view a Web site, make a phone inquiry, and
visit a retail store within days

or

even

hours

of

an

initial contact. To

improve customer satisfaction and secure customer lifetime value, companies

must

be able

to

capture

these

multiple

interactions,

provide

seamless

management between channels, and leverage shared customer information

create rewarding experiences and

to

to develop and execute highly targeted

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

functional group, and brand operates through independent systems, programs, and
touch points. As a result, there is limited synergy across the ecosystem, leading
to

significant

inefficiencies,

lack

of coordination, and most important, an

inability to maximize "share of wallet "from every customer through welltargeted marketing and cross-selling. Synergy between traditionally independent
business units such as captive finance companies and between functional groups
such as sales, service, and marketing is more critical now than ever before. Only
by sharing customer information can customer lifetime value be maximized among
different groups.

Complex data governance requirements - Global automotive enterprises have

large, complex information technology ecosystems. While customer information
must be shared within this ecosystem in order to fully maximize global operations,
it must also be protected. Proper management of customer information requires a
sophisticated capability

to

manage

variety

of

access

rules

and

to

accommodate legal restrictions that can change very quickly. The trust required for
successful collaboration between groups in the automotive enterprise must
built

by

demonstrating

that

customer

information

can

be

be shared while

observing these complex requirements.

Difficulty managing employee relationships - In today 's fast-paced business

environment, automotive companies need to ensure that their most valuable asset their employees -have immediate access to the critical information, services, and
applications required to be productive. Organizations must enable employees to
make better decisions, work collaboratively, enhance customer relationships, and
maximize productive time. Global automotive enterprises must be able to enact
and enforce consistent policies across business units, instill a common corporate
culture

across

employees

with

geographically
effective

search

dispersed
tools

and diverse workforce, equip

to training necessary to service

customers in a volatile and demanding market.

TARGET SEGMENT
To reach to rural and lower middle class consumers. They begin with small concentrated
markets appealing to local culture and aspirations of the targeted area

STRATEGY
THEIR STRATEGY IS TO CAPTURE THE RURAL MARKET BY EMPLOYING
WOMEN WHO BELONG TO THEIR LOCAL COMMUNITY THROUGH WHICH
THEIR PRODUCT CAN REACH TO LOCAL CONSUMERS. THEIR STRATEGY IS TO
PROVIDE WORK FOR WOMEN TO CREATE AWARENESS AMONG CONFINED
CONSUMERS

Process
They started with Project Shakti in which their basic aim is to educate a rural person about
their products through women who belongs to their own local community and who can
communicate well in their language with them. In this way many educated women get work
in rural sector and on the other hand HLL Corporate Social Responsibility (CSR) also
increases towards society by introducing educative programs for the benefit of the rural
sector

Mode of Communication
They reach to customers by giving advertisements in the T.V. or through radio, through wall
painting, or through promotional activities like weakly haats, mela or local bazaars

and

most importantly, their policies were flexible and they could adapt to fast changing
marketing situations.
Through Internet, E-mail usage, communication media like telephone and mail facility this
mode of communication is possible to a great extent. ITCs extensive India-wide distribution
network enables its greeting cards reach over 12,000 multi brand outlets in over 700 cities
across the country. In the last three years, 10,000 greeting card designs have reached these
outlets with the help of ITC's web-enabled e-commerce model Communication Model ITC
markets

Opportunity
These days consumers are

looking for

convenience and

instant

gratification.

Communication media like the telephone and e-mail facilitate communication to a great
extent. But many greeting card sites are moving from a 'free' to a 'pay' mode. This could
be an emerging revenue earning opportunity for content providers.

Threats
'Expressions' which is a competitor of ITC in this segment is currently the second biggest
greeting card brand in India with a market share of 20 per cent. ITC has a five per cent
share in the stationery market. The greeting card market in India is estimated to be
around Rs. 250 crore in terms of yearly consumer spent. The unorganized sector in the
greeting card market will be close to 40 per cent. The organized sector, controlling 60 per
cent of the market, is divided between ITC, Archies and Hallmark. While Archies has
licensing agreements with international greetings brands

CONCLUSION

The price of a car is just one-third of what it cost you over its lifetime. Running and
maintaining it make up the other two-thirds. Take into account resale value and its real
cost becomes clear. Maruti Suzuki stands for value as much as it stands for performance.
In spite of rising input costs, we try our best to keep prices down. Their running
costs and resale values are unbeatable too. Nothing matches the delight their cars
deliver. In the JD Power CSI study 2005, 85% of Maruti Suzuki owners stated that they
would definitely recommend the car they drive to someone else. Infact, you dont buy a
Maruti Suzuki. You invest in it.

After the rash of new cars launches the past two years, the relative lull in the auto
industry is showing up in the customer satisfaction indices. According to the 2005
four-wheeler Total Customer Satisfaction (TCS) study conducted by the specialist
division of TNS Automotive, the automobile ownership experience or customer
ownership experience has declined in all areas compared to 2004. The study is one of
the largest syndicated automotive studies in India, representing the responses of more
than 7,000 new car buyers. The comprehensive study covers over 50 models with
customer evaluations taken in the key areas of sales satisfaction, product quality,
vehicle performance and design, after-sales service, brand image, and cost- ofownership. The TCS index score provides a measure of satisfaction and loyalty a given
model enjoys with its customers.

According to TNS Automotive, the decline is

predominantly for older, small and entry mid-size car models. The ageing of these
models seems to be posing a stiffer challenge for manufacturers to sustain past
performance levels at a time when customer expectations are rising sharply.

The study reveals a significant increase in the importance of sales satisfaction, product
quality (both performance and design) and brand image since 2003, indicating rising
customer expectations over the years. This year's study shows the Maruti Suzuki Swift
and the Toyota Innova as the winners, with the two vehicles achieving segment-best
ratings by performing well in areas of greater relevance, particularly product and
brand image. Sales satisfaction is weak in both these models, largely because of the
longer waiting time for new deliveries.

AREAS FOR IMPOVEMENT / RECOMMENDATION

Facade/Quality of Dealership should be improve

Uniform of Sales Executives

Proper visiting cards should be available to the executives

Mostly dealers dont have their specific website

All Japanese 5s concept (Seiro, Sieton, Sciso, Seioetse, Shitsuke)

should be put into practice at Dealership

Maruti should regard as generous discount offers during Festival

Season like Navratra, Dusshera, and Diwali to gear-up their sales

Maruti should advertise in Sports because sports are increasingly

cutting into the share of mass entertainment channels

Maruti can start Money Bond Scheme instead of giving Cash Discount
with more value. Customers eligible for an income bond, encashable after a 15year
period.

BIBLOGRAPHY

www.google.com
www.maruti.com

www.wikipedia.com