PROJECT REPORT ON STUDY OF MARKETING STRATEGIES OF MARUTI UDYOG LIMTED
SUBMITTED IN PARTIAL FULFILLMENT FOR THE DEGREE OF MASTERS OF BUSINESS ADMINISTRATION (2007-2009)
SUBMITTED TO : MR. GAURAV SATIJA (LECTURER )
SUBMITTED BY: ANKUSH NATHOO ROLL NO: 3 MBA- IV Semester
AFFILIATED TO MAHARISHI DAYANAND UNIVERSITY
I owe my sincere thanks and gratitude to MS who inspired me by his able guidance and was a constant guiding light during the course of project study. The support and knowledge provided by him has been a great value addition for me and will go a long way in building a promising career. Last but not least, I am also thankful to all the respondents of my survey without whom the project would not have been completed successfully. (ANKUSH NATHOO)
INTRODUCTION OF THE COMPANY
OBJECTIVE OF THE COMPANY
both in domestic and export markets. Their focus is on:
• • •
Building a continuously improving organisation adaptable to quick changes Providing value and satisfaction to the customer Aligning and fully involving all our employees. Today. in the sense that optimal productivity of other resources depends largely on the way human resources are utilised. They see it as a unique resource. The company. The basic philosophy of management that
. We must retain our leadership in India and should also aspire to be among the global players. Maruti is India's largest automobile company. The Company Mission: To provide a wide range of modern.INTRODUCTION OF THE COMAPANY
MARUTI UDYOG LIMITED Maruti is India's largest automobile company. high quality fuel efficient vehicles in order to meet the need of different customers. suppliers and dealers to face competition
Maximising Shareholder's value Being a responsible corporate citizen
At Maruti. This feat was achieved by the missionary zeal of our employees across the line and the far-sighted vision of our management. a joint venture with Suzuki of Japan. has been a success story like no other in the annals of the Indian automobile industry. they have a clear perspective on manpower. The Company Vision: We must be an internationally competitive company in terms of our products and services.
must have the ability to rise above his own subjectivity. Secondly. To make this philosophy tenable. The first step in this direction has been the introduction of a common uniform for all employees. The Sahyog Samiti. through newsletters or via a letter from the Chief Executive to all employees. must practice what he preaches. They believe that everyone should contribute to the formulation of company policies. Meetings with the Union are held regularly. and. they ensure that there is a thorough dissemination of information at all levels. they encourage leadership in the best sense of the word. They understand that the process of creating a sense of belonging that all employees can identify with is a lengthy one. At Maruti They do not believe in the notion of organisational hierarchies. Maruti has a horizontal management structure with only four functional levels of responsibility to facilitate quicker decision making. Maruti believes that communication channels between labour and management cannot simply consist of having a labour representative on the Board of the Company. Inputs are sought from employees at all levels. most importantly. goals and objectives. and sit on the same table. common transport and similar facilities for all levels of employees are other measures that reinforce their emphasis on genuine equality in the workplace. they have taken several simple but specific and well thought out measures. the management structure and systems in Maruti have been designed to promote decentralisation of authority. a leader is one who must be impartial. Another measure is the creation of a common canteen where all employees have lunch. at Maruti. the Company takes several initiatives. To encourage this. to achieve commonly shared company goals and objectives. stand in common queues. and programmes being contemplated by the Company are discussed with the Union. According to us. To ensure that this translates into concrete reality. As a matter of fact.underlies the Maruti culture is that all employees of the company should be moulded into a team which then strives as one. Another focus area of the Maruti culture is the maintenance of a smoothly functioning communication network. a
. They have faith in the ability of labour to effectively participate in management and make constructive suggestions. Common toilets.
Quality Circles. They have met all project and performance targets since inception. Several measures of performance have made amply clear that Maruti has established a truly healthy work culture. Suzuki Motor Company was chosen from seven prospective partners worldwide. The objectives of MUL then were:
• • •
Modernization of the Indian Automobile Industry. which states that constant improvement is always possible. Yet. the Maruti culture is one that does not believe in resting on its laurels. 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. Production of large number of motor vehicles. training programmes in Japan. The Company has had good labour relations with employees from the very beginning. to meet the growing demand of a personal mode of transport caused by the lack of an efficient public transport system. 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". Production of fuel-efficient vehicles to conserve scarce resources. and an ethos of discipline and teamwork.collection of representatives of non-unionised employees. productivity-linked incentive schemes. Maruti Udyog Limited (MUL) was established in Feb 1981 through an Act of Parliament. and they have been successful in the export market. They adhere to the spirit of Kaizen. Their productivity levels are constantly improving. all contribute to the Maruti culture. which was necessary for economic growth.
. 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).
000 vehicles produced by August. our cars have become even more pleasurable to drive.000 vehicles produced by June. And dream. 1990
. the Maruti Udyog Plant has already rolled out over 4. Flexible and First Mover Innovation and Creativity Networking and Partnership Openness and Learning
Vision The leader in the India Automobile Industry. two vehicles roll out of the factory every minute. This results in better and greater maneuverability. In other words. Our other innovation has been the introduction of Electronic Power Steering (EPS) in select models. there's a Maruti Suzuki made here to fit every car-buyer's budget. with an incredible range of 11 models available in 50 variants. 1986 5. on an average. Production/R&D Spread over a sprawling 297 acres with 3 fully-integrated production facilities. December 1983 1. A pride of India” Technological Advantage We have introduced the superior 16 * 4 Hypertech engines across the entire Maruti Suzuki range.3 million vehicles. just 14 hours to make a car.00. Creating Customer Delight and Shareholder’s Wealth. Production Milestones 1st vehicle produced. And it takes on an average. More importantly. In fact. This means every Maruti Suzuki owner gets the ideal combination of power and performance from his car.00.• • • •
Fast. This new technology harnesses the power of a brainy 16-bit computer to a fuel-efficient 4-valve engine to create optimum engine delivery.
00.000 vehicles produced by December 2001 40.00.00. 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 respected
. 1999 30.000 vehicles produced by June.00.00.000 vehicles produced by April.Alto number one in its segment for the 2nd time in a row. 1996 20. 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 . WagonR and Swift topped their segments in the TNS Total Customer Satisfaction Study Leadership in the JD Power Initial Quality Study .000 vehicles produced by October.000 vehicles produced by March.000 vehicles produced by April.00. 1997 25.000 vehicles produced by March.000 vehicles produced by April. 2003 45. 2000 35.00.10. Esteem number one in its segment for the 3rd year in a row.00. 1994 15.the only car to win it so many times M800.
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.Sep '04 2004 Maruti Suzuki was No. 1 in Customer atisfaction. for contribution to exchequer and being an ideal tax
.companies in India-Oct 04 Maruti ranked among top ten (Rank7) greenest companies in India by Business Today . Central Board of Excise & Customs awards Maruti with "Samman Patra". 1 in Total Customer Satisfaction (Maruti 800. 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 . 1 in Product Appeal (Esteem and Wagon R) No. Zen and Esteem Maruti 800 and Wagonr top in NFO Total Customer Satisfaction Study 2003.1 in Product Quality (Esteem and Alto) and No. Zen and Alto) Business World ranked us among the country's five most respected companies Business World ranked us the country's most respected automobile company Voted Manufacturer of the year by CNBC Voted one of India's Greenest Companies by Business Today-AC Nielson ORG-MARG 2003 Maruti 800. No. achieves highest CSI rating.1st rank. unique achievement by market leader anywhere in the world 1999 MSM launched as model workshop in India. 1 in Sales Satisfaction No.
assessee 1998 CII's Business Excellence Award 1996 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
1 in the premium compact car segment and the Esteem in the entry level mid-size car segment across 9 parameters. layout and performance of vehicles across 8 parameters.D. No wonder Maruti Suzuki has been awarded the No.
. it should have a reliable service network at hand and within easy reach. a feat unprecedented for any automobile market leader in the world.1 nameplate in customer satisfaction in India for the fifth year in a row.1 in quality: Maruti Suzuki owners experience fewer problems with their vehicles than any other can manufacturer in India (J.000 vehicles a day. Maruti Suzuki has not only got the No. Maruti Suzuki has a sales network of 307 state-of-the-art showrooms across 189 cities*. salesperson.WHY MARUTI SUZUKI
The Quality Advantage A car is an engineering product.1 in the entry level midsize car segment. content. The J. What is significant is that it was ranked above Skoda. only as good as the technology used to make it. Their 1036 city strong service network is equipped to service 20. Mitsubishi and Hyundai. Power IQS Study 2004).D. Actual users of our technology are saying something very clearly Maruti Suzuki is No.D. 1 in the premium compact car segment and the Esteem No.1 nameplate in the J. Power SSI study 2004. Chevrolet. This study measures owner delight in terms of design. Our high sales and customer care standards led us to achieve the No. paperwork. Power SSI study 2004. The SSI study measures sales satisfaction across 6 parameters: deal received. with a workforce of over 6000 trained sales personnel to guide our customers in finding the right car. To be really happy with the car you own. Power APEAL Study 2004 proclaimed the Wagon R. dealer facility.1 nameplate in the J. The Alto was chosen No. but also ranked way above the industry average (Maruti Suzuki was at 784 while industry average was at 760). delivery timing and delivery process. No.D. Ford.
exchange.D. insurance. fleet management services. Power SSI Study 2004. One Stop Shop At Maruti Suzuki.D. Power CSI study 2004. Power CSI Study 2004. The Low Cost Maintenance Advantage
. highest service quality. best inservice experience. Power CSI study 2004 also reveals that 97% of Maruti Suzuki owners would probably recommend 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. Whether it is easy finance. 92% of Maruti Suzuki owners feel that work gets done right the first time during service.D. Our high sales and customer care standards led us to achieve the No.Maruti Suzuki is set to provide a single-window solution for all your car related needs. most user-friendly service and best service initiation experience.D. best service advisor experience. 92% of Maruti Suzuki owners feel that work gets done right the first time during service. Maruti Suzuki scored the highest across all 7 parameters: least problems experienced with vehicle serviced. In fact.D. best service delivery. while 90% owners would probable repurchase the same make of vehicle.In the J. Maruti Suzuki scored the highest across all 7 parameters: least problems experienced with vehicle serviced. with a workforce of over 6000 trained sales personnel to guide our customers in finding the right car. The J. best service delivery. while 90% owners would probably repurchase the same make of vehicle. Power CSI study 2004 also reveals that 97% of Maruti Suzuki owners would probable recommend the same make of vehicle. Quality Service Across 1036 Cities In the J. The J. you will find all your car related needs met under one roof. best in-service experience. highest service quality. most user-friendly service and best service initiation experience. best in-service experience.1 nameplate in the J.
Wagon R. Employee Quality Measures Kaizen is based on the concept of making incremental improvements in our products. In the Lower Mid-size segment as well. Alto and Omni.The acquisition cost is unfortunately not the only cost you face when buying a car. In the Maruti Suzuki stable. Zen. The recent Auto car Survey conducted in August 2004 bears testimony to this fact. where the cars have to be not only affordable on purchase price but also need to combine quality. it may not necessarily be affordable to maintain. Esteem. as shown by the recent J.
. In the Upper Mid-size segment. the Maruti Suzuki Versa has scored particularly well with the lowest cost of spares in the segment. Alto. Lowest Cost of Ownership To be really happy with the car one owns. drivability and have comfortable interiors. The 6 highest satisfaction ratings with regard to cost of ownership among all models are all Maruti Suzuki vehicles: Zen. Maruti 800. the Maruti Suzuki Baleno has the segment's lowest prices on a majority of the spares.422. It incorporates a series of continuous small and simple improvements. which aim at involving employees at all levels. Omni and Wagon R.D. In this segment. price-consciousness is very high. Not so in the case of a Maruti Suzuki.Power CSI study 2004.the top 5 models are all Maruti Suzuki models: Maruti 800. They are proud to have the lowest cost of operation / km (among petrol vehicles) . The Maruti800 has the cheapest spares of any Indian car with a basket of just Rs. and it is here where Maruti Suzuki shines. It is clear that a Maruti Suzuki delights you even when you run it for years. 23. Although a car may be affordable to buy. as some of its regularly used spare parts may be priced quite steeply. it should be easy on the pocket to buy and to run-which is why the cost of ownership is so important. the Omni has the lowest aggregate cost of spares followed by the Maruti-800. a Maruti Suzuki is a clear winner. And here again. It is in the economy segment that the affordability of spares is most competitive.
Continual improvement. Process approach. The movement of quality indicators is reviewed in weekly meetings by the top management. "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.
. In 2001. Over 50. global auditors for International Organization for Standardisation(ISO). Supervisors educate and instruct technicians to continually improve productivity and quality. employees are encouraged to make suggestions for improvement in any area of our operation. Leadership. ISO 9001:2000 At Maruti. our approach to quality is in keeping with the Japanese practice--"build it into the product". etc. Maruti Udyog Ltd became one of the first automobile companies anywhere in the world to get an ISO 9000:2000 certification. Technicians themselves inspect the quality of work. System approach to Management. Involvement of people.000 suggestions are received from employees every year. covering varied parameters like Customer Focussed organisation. Since 1998 Maruti has won this award 10 times. Maruti has won the First place in "Excellence in Suggestion Scheme Contest 2003". This contest is organized by Indian National Suggestion Schemes Association (INSSAN). We believe that it is this unwavering commitment to quality that will lead to the further growth of the organization as competition increases. Under this scheme. AV Belgium.The Suggestion Scheme is based on the same principle. certified Maruti after a four day long audit. which is the 6th consecutive award won in as many years.
This authenticated our quality systems and testing facilities for export to Europe. The audit for this covered quality assurance in production. MUL passed the Conformity Of Production (COP) Audit. We were also one of the first companies in the world to pioneer ISO 9000 certification for our dealers. which is based on a European Union Directive. Maruti got ISO 9002 certification. marketing and sales as well as after sales services. In October 1993. 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.In May 1995. installation. TS16949:2002 A new feather was added recently in Maruti’s cap in the
field of quality when the Quality Management System of its Press Shop &
. This commitment to quality has ensured a consistently satisfying product and world-class sales and after-sales services.
As a part of Quality system requirements. 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. The TS 16949 standard. which are particularly specific to the automotive industry and requires an organization to be in compliance with ISO 9000 systems as a basic requirement. Daimler Chrysler. TS 16949 has gained high popularity and almost all major automobile players across the globe including GM. is an extension of the ISO 9001:2000 standard that prescribes Quality management system requirements that are specifically applicable to the automotive industry. Honda are embracing & promoting it. whereas QS 9000 would become defunct and cease to exist after Dec 2006. These standards address Quality System requirements. However. Nissan. TS 16949 is going to be the standard of the future. brought out by ISO in the year 1999. Ford.associated functions (collectively termed as Press Function) got certification for conformance to the requirements of TS16949:2002 standard.
. GM requires all its suppliers to be certified to either ISO TS 16949 or QS 9000.
the ultimate consumer of a product.ISO 9001:2000
Consumer is strictly. 'Consumer' is not normally applied to the purchase of industrial goods and services where the customer is usually a corporate body. Consumer behavior is the study of buying habits or patterns of behaviour of consuming public either in general or in specific groups. moreover. the ultimate user of a product. 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. THE BUYING PROCESS
. the person who derives the satisfaction or the benefit offered. The 'consumer' is not necessarily the customer. Nevertheless. the consumer is frequently not the person who makes the buying decision. since there are often 'customers' in the buying/ distribution chain. consumable goods are sold to industry for corporate purposes and the consumers of these goods can be identified for marketing practice.
and the consumer evaluates the success of his purchase decides whether to buy that particular product and / or brand again. a brand selected.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. 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. It the same time.
evaluation of alternatives purchase decision and post-purchase behavior.The starting point for understanding the buyer is the stimulus-response model shown below
Marketin g stimuli Other stimuli Buyer's Characteris tics Cultural Social Personal Psychological Buyer's decision process Problem recognition Information search Evaluation decision Post-purchase behavior Buyer's decisions
Product Price Place Promotio n
Economic Technologi cal Political Cultural
Product choice Brand choice Dealer choice Purchase timing Purchase amount
Stages in Buying Decision Process
Need recogniti on Informat ion search Evaluation of alternative s Purchas e decisio n Postpurchase behavior
The consumer passes through five stages : Problem recognition information search. But this is not the case. Clearly the buying process starts long before the actual purchase and has consequences long after the purchase. because it captures the full range of consideration that arise when a consumer facer a highly involving new purchase. Consumers may skip or rreverse some stages. we have already used the model in above. skipping information search and evaluation. especially in low-involvement purchase. However. This model implies that consumers pass through all five stages in buying a product. Thus a woman buying her regular brand of toothpaste goes directly from the need for toothpaste to the purchase decision. We will allude again to Linda Brown and try to understand how she
MAJOR FACTORS INFLUENCING BUYING BEHAVIOR
Cultural Social Culture Subculture Social Class Reference group Family Roles and statuses Personal Age and lifecycle stage Occupation Economic circumstances Lifestyle Personality and self-concept Psychological Motivation Perception Learning Beliefs and attitudes Buyer
Rogers model for the adoption and diffusion of innovations Adoption CURVE
.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.
The innovation adoption curve of Rogers is a model that classifies adopters of innovations into various categories.
. Innovators Brave people. Innovators are very important communication. but in a careful way. Is is also referred to as Multi-Step Flow Theory or Diffusion of Innovations Theory. careful but accepting change more quickly than the average. 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. Also the categories and percentages can be used as a first draft to estimate target groups for communication purposes. caring for the "old ways". 2) the decision-making process that occurs when individuals consider adopting a new idea. 3) the characteristics of individuals that make them likely to adopt an innovation. Late Majority Skeptic people. puling the change. Early Majority Thoughtful people. are critical towards new ideas and will only accept it if the new idea has become mainstream or even tradition. It makes more sense in these circumstances to start with convincing innovators and early adopters first. product or practice. Diffusion research focus was on five elements: 1) the characteristics of an innovation which may influence its adoption. try out new ideas. Early Adopters Respectable people. will use new ideas or products only when the majority is using it. based on the idea that certain individuals are inevitably more open to adaptation than others. Laggards Traditional people. opinion leaders.
To solve problems.
. you need to understand that people purchase products or services for three basic reasons:
• • •
To satisfy basic needs. 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.
The next step in creating an effective marketing strategy is to zero in on your target market. To make themselves feel good. 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’. Target marketing is the selection of customers you wish to service.TARGET MARKETING
Target Marketing involves breaking a market into segments and then concentrating your marketing efforts on one or a few key segments. Next.
Geographic: The location. speculate on who they might be. occupation. density. 2. and loyalty characteristics of your customers. Behaviors: The needs they seek to fulfill. 3. family composition and size. Investigate competitors or similar businesses in other markets to gain insight. based on their needs and the benefits they will receive. Demographics: The age. information sources. life-style. income. repetition of need. size of the area. and climate zone of your customers. yet more profitable customer groups within the total market. Four Ways to Identify Target Markets 1. rate of use. 4. gender. and then targeting smaller. Psychographics: The general personality. attitude. One of the best ways to identify your target market is to look at your existing customer base. and education of your customers. benefits sought. the level of knowledge. The idea is to increase sales by first identifying. Who are your ideal clients? What do they have in common? If you do not have an existing customer base. behavior. or if you are targeting a completely new audience. TARGET MARKETING
Who are your best customers? Where should you direct your marketing activities?
Where and how should you allocate your advertising and promotional efforts?
. use or response to a product of your customers.Target marketing is one of corporate America's most effective business strategies.
Once they have identified the actual prevailing attitudes. AS YOU ANALYZE YOUR MARKET AND CUSTOMER PROFILES. This is an incredibly difficult process at best. people have believed that advertising can be used to change people's minds about what they want. and an extremely expensive one. DESIRES. AND PERCEIVED NEEDS. CONSIDER BOTH THE SHORT TERM AND LONG-TERM IMPLICATIONS OF DEVELOPING AND IMPLEMENTING THE RIGHT TARGET MARKETING STRATEGY FOR YOUR BUSINESS. provides Focus for your business. "What are the existing customer attitudes?"
.Target Marketing. the marketing oriented firm tries to produce or sell what its customers want which can be sold at a profit. Instead.
Customer Attitudes For a long time. they can begin to organize company resources needed to constructively address and satisfy these attitudes the key question is. or happens to have on hand. it is an attitude Instead of trying to get customers to buy what the firm likes to make. • Do not simply throw out everything that you now have and replace goods or production machinery with completely new items. it is a process that smaller firms simply cannot afford to pursue. YOU CAN BEGIN TO REORIENT YOUR BUSINESS OVER TIME TO TAKE BEST ADVANTAGE OF THESE NEW INSIGHTS. it is much more productive for any size firm to tune in to target customer attitudes as they currently exist. AND SO GAIN AN UNDERSTANDING OF THEIR WANTS. 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. HOWEVER. Because of these two factors.
With this as an objective. developing an understanding of existing customer attitudes becomes essential. Target Marketing
. the entire firm can then organize itself to satisfy these needs as completely and efficiently as possible. Once these customer attitudes. needs or preferences are identified. and their identification becomes an important part of the marketing process.
Comparison of Automobile And Consumer Durable
At Dealership Level S.No 1 2
Turnover Margin Penetration Level Training of Sales Executives
High 8%-12% More in small or large towns or cities Executives get Training after every specific period
Low 2%-4% More in Rural areas or in cities also
As such no training Co->Distributor>Dealer >Customer Depends on Dealer To Dealer Only Sales man is there to serve the customer Customer have to go at manufactured level Customer can change his or her choice More focus on Finance & Installment
Supply-Chain Discount Margin
Proper well organized Customer get 3free service Customer first choice is more pertinent
ASS Brand Association
Payment Post-Sales Follow UP Buying Procedure Database Brand Transition
More Customer can wait for new model Large Single-Tier
12 13 14
Instant buying Few Multi-Tier
Defined & Organized Free Service Camps
More Only free service which customer can extend upto 4 years(first 2yr are free)
Annual Maintenance Contract (AMC)
Advertisement Loyality Programs Customer Satisfaction Index Promotion Customer Retention
Parent Company & dealer both give advertisement Yes
Only from Parent Company No
. with a capability to produce about half a million vehicles.MARUTI CULTURE
Their employees are their greatest strength and asset. has been the leader of the Indian car market for about two decades. and a common canteen for all. Division Heads to Department Heads. completely designed and styled in-house. has an installed capacity of 3. common uniforms (at all levels). In recent years. they have taken several measures like a flat organizational structure. located some 25 km south of New Delhi in Gurgaon. luxury car Baleno. Versa. It is this underlying philosophy that has moulded their workforce into a team with common goals and objectives. Maruti has made major strides towards its goal of becoming Suzuki Motor Corporation's R and D hub for Asia. Communication and information sharing. It has introduced upgraded versions of WagonR Zen and Esteem. Swift and Luxury SUV Grand Vitara XL7. premium small car Zen. a subsidiary of Suzuki Motor Corporation of Japan. Their Employee-Management relationship is therefore characterized by:
• • • •
Participative Management.50. Its manufacturing plant. There are only three levels of responsibilities ranging from the Board Of Directors. international brands Alto and WagonR. It also creates an environment that builds trust. the MPV. Other visible features of this philosophy are an open office. transparency and a sense of belonging amongst employees. Omni. mid size Esteem.000 units per annum. off-roader Gypsy. Team work & Kaizen. Open office culture for easy accessibility
To implement this philosophy. including Maruti 800. The company has a portfolio of 11 brands. This structure ensures better communication and speedy decision making processes. For Investors: Maruti Udyog Limited.
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. In keeping with its leadership position. Joint Managing Director Mr Kinji Saito. besides providing total mobility solutions to customers in a convenient and transparent manner. Director Mr Kumar Mangalam Birla. The company has also ranked highest in India Sales Satisfaction Study. Maruti Insurance and Maruti Finance are now fully operational. Its emotional connect with the customer continues. Director (Marketing and Sales) Mr Osamu Suzuki. Currently the directors on the Board are:
• • • • • • • • •
Mr Shinzo Nakanishi. Power Asia Pacific 2005 India Customer Satisfaction Index (CSI) Study. have helped improve economic viability of The company's dealerships.. The company's service businesses including sale and purchase of pre owned cars (TrueValue). Director Mr R C Bhargava. Director Mr S V Bhave.D. indeed its impact on the lifestyle and psyche of an entire generation of Indian middle class. is widely acknowledged. The company is listed on Bombay Stock Exchange and National Stock Exchange. The company's quality systems and practices have been rated as a "benchmark for the automotive industry world-wide" by A V Belgium.Maruti's contribution as the engine of growth of the Indian auto industry. Director
. These initiatives. global auditors for International Organisation for Standardisation. Chairman Mr Jagdish Khattar. Joint Managing Director Mr Shinichi Takeuchi. MUL is a Board-managed company. Maruti tops customer satisfaction again for sixth year in a row according to the J. lease and fleet management service for corporates (N2N). Managing Director Mr Hirofumi Nagao.
Director Mr Manvinder Singh Banga. Director Ms Pallavi Shroff. Director
.• • •
Mr Amal Ganguli.
B. C. and a nticipate and address the customer’s needs and preferences in all aspects and stages of car ownership. design and styling. they retain the brand name of the product through various stages of product upgrades over time.
A A B B B C C
Maruti 800 OMNI Zen Wagon R Alto Esteem Baleno
. of the Maruti 800 launched in 1983. to provide what they refer to as the “360 degree customer experience. they manufacture nine models and import the Grand Vitara as a completely built unit from Suzuki in Japan.” They sell ten models with more than 50 variants in segments A. For example. styling and features. in terms of technology. Their models and variants are designed to address the changing demands of the market and are periodically upgraded in technology. and utility vehicle segment of the Indian passenger car market. Of these.OBJECTIVE OF THE COMPANY
Maruti’s marketing objective is to continually offer the customer new products and services that: • • Reduce the customer’s cost of ownership of their cars. To take advantage of the brand recognition associated with their products. the version of the Maruti 800 brand currently sold in the market is a significantly upgraded version.
C C Utility Vehicle Utility Vehicle
Versa SWIFT GYPSY KING GRAND VITARA
I inquired from them about their marketing advertising and distribution strategies. The reason for choosing the exploratory research design is the fact the project report has been primarily based upon the secondary sources of data and whose authenticity could be assured of. The sources of data used in data collection are the following:
In order to gather information about the various products. Detail regarding the packaging of the products were collected were collected and I also inquired about the various sales promotion schemes followed by the three companies. is taken to be tested. I personally visited a number of retail markets and collected data pertaining to the prices of the products offered. The reluctance of the company's personnel in parting with much of information led the project report to be based substantially on the secondary source of data. By interviewing these retailers valuable information was collected.
The nature of the project work has been exploratory as no hypothesis. Though the conclusions drawn could be taken as the hypothesis and further tested by the research work undertaken in the relevant field. The market visits were useful in knowing the comparative prices and quality of the offered brands vis-à-vis the competitive brands.
newspapers. business magazines. The data collected from the above mentioned sources has been adequately structured and used at appropriate places in the report.Secondary sources
Information was collected from secondary sources such as public libraries.
. Posters. Press clippings. Pictures. Beside these the use of Internet was also made in collecting relevant information. Newsletters. This particular way of data collection was used because of its low cost (except data collected through surfing the internet) and less time consumption. News releases. Pamphlets. The information gathered included:
• • • • • • •
Their annual reports (Procter & Gamble and Johnson and Johnson).
which comes into effect from today.22% 264762 500 0.18% 192725 2000 1.32% 444968 1000 0. In this phase.47% 368160 5000 1.23% 470779 1000 0.28% 340106 5000 1.21% 510520 1000 0.22% 475223 1000 0.26% 212562 500 0.23% 227388 3000 1.36%
.47 percent. which increased following the rise in oil prices.17% 432575 1000 0. Zen.23% 220768 500 0. 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 Chang Old Increase e % 191146 500 0.17 percent to 1. varies from 0.24% 231085 500 0.19% 283378 500 0. 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.21% 359182 1000 0. The increase. Baleno (Vxi) and WagonR (Petrol).20% 575173 1000 0. The price increase is due to rise in input costs and freight costs.FINDINGS OF THE STUDY
PRICES OF MARUTI PRODUCTS Car market leader Maruti Udyog Limited has announced a marginal increase in price of certain models.04% 213206 500 0.
Head office MD
MFG FIN OTHER
DIRECTOR GM/ DGMS
N CONTROLLER DGMS AGMS
ENGINEERS(EX) TRAINEES J./EX
.ORGANISATION STRUCTURE AT MUL
Maruti Udyog ltd. (TRAINEES)
SR.E. Has a flat organisation structure with a maximum of three levels. EX.
THE PRODUCTION PROCESS AT MARUTI
PAINTING FROM VENDOR S FROM VENDOR S FROM VENDOR S
SUPPLY & DISPATCH
In August, 2003 Maruti crossed a milestone of exporting 300,000 vehicles since its first export in 1986. Europe is the largest destination of Maruti’s 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.
Total 758.Total 901.2 46 9% 16% 17% 46% 16% 17% 66.MUL 2003.366 522.3 16 2% 8% 7% -16% 8% 8%
59.MUL 420.12 Industry 3 MUV (Utility Vehicles) 3.129./Prem.94 7 Passenger Vehicles .66 4 948.280 54% 335.03 8 1.526 417.56 17% 116.204 28% 487.374 527.136 24% 2 14./Luxury) C (Van Type) Passenger Cars .173 28% 29.402 24% 1.050.Growt 2004-05 Growt 2005.Growt 04 h h 06 h 167.555 Passenger Vehicles .13 47% 271.66 9 4.39 2 Passenger Cars .019 28% 482.MARUTI ALL INDIA SALES – 3 YR TREND
Segment A1 (Mini .15 Industry 0
.262 -31% 89.Hatchback) A2 (Compact .637 109% 31.198 26% 885.939 8% NA NA NA NA NA NA 15% 65.Hatchback) A3 (Mid Size) A4/A5/A6 (Exec.029 12% 5.223 -23% 1 176.
2005-06 Market Share-Segment A2
2005-06 Market Share-Segment A3
HYUNDAI 16% MARUTI 17% FORD 14% OTHERS 7% HONDA 20% GM 6% TATA 20%
2005-06 Market Share-Passenger Cars
HYUNDAI 17% TATA 16% HONDA 4% FORD 3% GM 1% TOYOTA 1% OTHERS 3%
Tata Indica & Palio.E.Pajero. Scorpio. Fusion.Elantra & Sonata.C. Ford Endeavor. GM . Tata .Prado & Innova. GM . Optra.Corsa Sail Hyundai .Accord. Baleno Hyundai .Accent. GM . Honda CRV. Swift Esteem. & Bolero Competition
A4/A5/A6 (Exec. Nissan . Tata . & Fiesta Hyundai ./Prem. Versa Gypsy. Grand Vitara
.X Trail. & S Class.Corsa.Mondeo.Forrester & Tavera.COMPETITION MODELS SEGMENT
A1 (Mini Hatchback) A2 (Compact Hatchback) A3 (Mid Size) Maruti M800 Zen. Alto. Mahindra Jeeps.Vectra. Honda .Sumo & Safari.Indigo & Petra.City. GM . Mitsubishi . Daimler Chrysler .Santro & Getz. Skoda .Octavia & Superb. Toyota .Ikon. Ford .Corolla & Camry. Honda . Hyundai Terracan & Tucson. Toyota . WagonR. Ford ./Luxury ) C (Van Type) MUV (Utility Vehicles) Omni. & Aveo.
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. the Maruti 800 and the Omni. a versatile vehicle that can seat more passengers than the Maruti 800 or be used as an ambulance or cargo vehicle. their manufacturing processes and business practices. in segment B (priced between Rs. the absence of other manufacturers in segments A gives their dealers greater flexibility in promoting models in segment B. while continuing to offer products in most segments of the Indian market. The Omni. and continued to have the highest sales volumes of any model. they have access to globally respected technology in the small car segment. They have the advantage of Suzuki’s expertise in all aspects of small car technology and design. Extensive product portfolio: Their diverse product range includes cars in segments A. had a market share of 10.000).3%. and utility vehicles.-
MUL believes that they are well positioned to maintain and enhance their leadership position in the small car segment in India. In addition. B and C. which include the following: Expertise in small car technology: As a subsidiary of Suzuki. with a market share of 25. the development of their supply chain and the training of their personnel.300.000) where they have two models. on account of their competitive strengths.
. They are also the only manufacturer to sell three distinct models.500. They are the only manufacturer of cars in segment A (priced below Rs.300. They manufactured five out of the ten models that were sold in the combined A and B segments in India in fiscal 2002. The Maruti 800 has been the largest selling car in India for several years.5% in fiscal 2002. the Alto and the Wagon R. with respect to their products. the Zen.000 and Rs.
ranked us No. Most of their principal competitors have been present in the Indian passenger car market for a significantly shorter period. which assesses customer satisfaction with product quality and dealer service. NFO
. Inc. Extensive sales and service network: They believe that they have the largest network of dealers and service centers amongst car manufacturers in India. automobile insurance. primarily in order to benchmark our products against international quality standards. they were one of the first automobile manufacturers in the world to receive the ISO 9001:2000 certification. D. 2003. In 2000. As of March 31. In contrast. or MASSs. or have left the market altogether. which covered 898 cities in India backed by Express Service Centers on 30 highways across the country. Power Asia Pacific.545 Maruti Authorized Service Stations. Their products for export are manufactured using the same assembly line as our products for the domestic market. they had 342 dealer workshops and 1. To service this car parc. This has contributed to the strength of their brand. They estimate their car parc to be in excess of 3. Certain manufacturers have ceased to manufacture certain products shortly after introducing them. 2003. 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. Maruti-certified pre-owned cars available for purchase. They have exported products to approximately 70 countries. 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. we had 178 authorized dealers with 243 sales outlets in 161 cities. 1 in the India Customer Satisfaction Index. they continue to support the maintenance of their products. 2001 and 2002. including countries in Western Europe. They began to export products in 1988. and leasing and fleet management. in order to promote customer loyalty. In addition to the distribution of their cars. at March 31.Quality products: In November 2001. 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. J.5 million vehicles.
who together supply a substantial portion of their purchases of components. components and spare parts of their products. 002. which is the highest among passenger car manufacturers in India and among the passenger car manufacturing facilities of Suzuki’s subsidiaries outside Japan. This would enable them to benefit from significant economies of scale. As a result. 2003 were in technical collaboration with foreign entities.Automotives 2002 Total Customer Satisfaction Survey ranked Maruti products as No. Their facility has advanced engineering capability and each plant is upgraded on an ongoing basis to improve productivity and quality. In order to improve quality and generate economies of scale. 113 of their vendors at March 31. “Premium Compact” and “Entry Midsize” segments respectively. 2000 to 299 as of March 31. As of the same date.000 vehicles per year. They believe that they would be able to expand their production to 500. 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. 2003. and intend to continue to reduce the number of our vendors. Vendors located within a radius
. A number of their vendors are their dedicated suppliers in that they account for a majority of their turnover. They have consistently produced in excess of their installed capacity in the five fiscal years ended March 31. they have reduced the number of their vendors of components in India from 370 as of March 31. Integrated manufacturing facility: Their manufacturing facility comprises three integrated plants with flexible assembly lines located at Gurgaon in the northern state of Haryana. 1 in the “Economy”. we had strategic equity interests through joint venture agreements in 13 of their vendors. They have an installed capacity of 350.000 cars per year with minimal additional capital expenditure. Strong vendor base and higher rates of localization: They work closely with their vendor base for the supply of raw materials. for 2002. They believe that they are one of the most efficient among the vehicle manufacturing facilities of Suzuki’s subsidiaries outside Japan in terms of productivity measured as the ratio of number of vehicles produced to number of employees.
to increase the rate at which they are able to localise production of their new models over time. As of March 31. For instance. As a result. They have been present in the Indian passenger car market for a significantly longer period than most of their principal competitors. 1. for their working capital and capital expenditure in the future. their managing director has almost ten years of experience with them.992 million. they have relatively low interest expense and flexibility to raise funds.9. lower cost components in their models. and most of the heads of their divisions have more than 15 years of experience with them. This has helped them reduce the cost of their components. Capital resources: They have cash and bank balances and current investments amounting to Rs. As of the same date. They have been able. 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. 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. As a result.of 100 kilometers from their facility supply the majority of their components. they had relatively low levels of outstanding indebtedness.
. if necessary. including training by Suzuki.555 million. in collaboration with their vendors.900 of their employees had been trained at Suzuki’s facilities in Japan. a concept they refer to as localisation. they have been able to build a highly experienced management team that is familiar with conditions in the Indian passenger car market. in the amount of Rs.4. 2003.
Increased availability of automobile finance: They continue to seek opportunities to expand the size of the Indian passenger car market. and continues to be. central to their strategy as the leading manufacturer in the small car segment to expand the size of the
. they aim to provide customers with a “one-stop shop” for automobiles and automobilerelated products and services.BUSINESS STRATEGY
They intend to continue to focus on the small car segment. especially in the small car segment. through facilitating easy availability of automobile finance. 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. They aim to achieve their principal objectives by pursuing the following business strategies: Maintain and enhance their product range: They intend to utilize Suzuki’s expertise in small car technology to produce new variants of their existing models and to upgrade their products with contemporary technology and features. To that end. in terms of geographical spread. while offering products in most segments of the Indian passenger car market. and penetration. of their products across India. in terms of sales volumes. they have recently entered into an agreement with the State Bank of India. Continue to reduce costs to offer more competitive products: Cost competitiveness has been. 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. Increase reach and penetration: They plan to continue to utilize their extensive sales and service network to increase the reach.
during the life of the vehicle. and resale value.
. insurance. the cost of fuel and maintenance.market by offering competitively priced. 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. including spare parts and repairs. they seek to reduce the consumer’s cost of ownership of their cars. which comprises the cost of purchase. high quality products.
They have nine regional offices.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 have the right to sell their products and services through other dealers or intermediaries in any territory. The sales of their spares. In order to assist their dealers in enhancing their performance and capabilities. These agreements are generally renewable for successive terms of three years. Their dealers provide services to customers such as pre-delivery inspection of vehicles.500 sales executives. supply of spare parts and other services that promote sales of cars within the territory for which they are appointed. their regional offices and their area offices monitor and assist their dealer network. Their agreements with their dealers usually have terms of five years. They are linked to their sales network through their secure extranet-based information network. whether or not one of their dealers is already established in that territory. They believe that this is the largest network of dealers amongst car manufacturers in India. The agreements typically permit termination by either the dealer or them with six months’ prior notice. They follow the performance of their dealers and frequently suggest improvements. 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. by mutual agreement. after sales service. sales of cars. Their dealers employed more than 3. accessories and automobile-related services such as insurance and finance serve as additional sources of revenue for our dealers. five area offices and 187 sales and marketing personnel. Enhancing dealer performance: Their central office in Delhi. Their dealers are required to maintain their outlets in accordance with their specifications and employ well-trained sales staff. they have introduced a concept of “Balanced
such as manpower recruitment and training. they sell spares under the brand name “Maruti Genuine Parts”. provides value-added services. service. financial management and management systems. including sales. To promote sales of their spare parts and the availability of high quality. These are distributed through their dealer network and through authorised sellers of their spare parts..Scorecard”. to their dealers. Guwahati and Pune. In addition.
Network As on date there are 342 Maruti dealer workshops and 1. in three locations in India. or MGP. they seek to measure the performance of a dealership in several areas of operations. to whom they refer as stockists. or MASSs.400 dealer sales personnel. Dealer training: They have established standard operating procedures. reliable spare parts for their products.545 Maruti Authorised Service Stations.
. They intend to extend this service to an additional 25 cities over the next three years. True Value Solutions Ltd.600 and 3. Kolkata. spares and accessories. They believe that the “Balanced Scorecard” serves as an effective incentive for dealers to enhance their performance. As a benchmark for dealers with respect to service quality and infrastructure facilities. Using this tool. 24-hour mobile service is offered in 38 cities under the brand “Maruti On-road Service”. or MSMs. They provide periodic training through their training centres located at their manufacturing facility and at Chennai. they have launched service stations under the brand “Maruti Service Masters. They reward dealers who perform well on the “Balanced Scorecard” with a cash payment at the end of the fiscal year. They have service stations on 30 highways in India under the brand “Express Service Stations”. showroom ambience and service quality standards for dealerships. Their subsidiary. They have trained more than 2. covering 898 cities in India.
through their dealership network. 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. carcare products and utility products. Their dealers are required to address any claim made by a customer. in accordance with practices and procedures prescribed by them. or upgrade to a new Maruti car.
. The dealers subsequently claim the warranty cost from them. insurance and financing. The extended warranty program is intended to maintain the dealer’s contact with the customer and increase the revenue generated from sale of spares. They analyse warranty claims from dealers and either claim the cost from vendors. They offer an extended paid-warranty program marketed under the brand. under the provisions of the warranty in force at that time. in the case of manufacturing defects. or MGA. In order to increase the penetration. of their products in these remote areas. They have entered into arrangements with insurance companies to cover the costs of warranties offered under this program. They seek to provide customers with the opportunity to customize their vehicles with accessories such as music systems. in the case of defective components. Warranty and Extended Warranty Program They offer a two-year warranty on all their vehicles at the time of sale.Many of their MASSs are at remote locations where they do not have dealers. or bear the cost ourselves. “Forever Yours” for the third and fourth year after purchase. security systems. Genuine Accessories They have also entered the business of marketing car accessories under the brand name “Maruti Genuine Accessories”. accessories and automobile-related services. in terms of sales volumes. 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.
They have recently launched new initiatives to develop the market for automobile insurance. and the caring relationship they share with those who drive their cars. means “a guest is like God”. and pre-owned cars. you will find all your car related needs met under one roof. Atithi Devo Bhava. Atithi Devo Bhava: One-stop shop Inspired by the spirit of India. which they refer to as the “360 degree customer experience”. At Maruti Suzuki. 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. leasing and fleet management.NEW BUSINESS INITIATIVES
As the largest manufacturer and leader in the small car segment. They aim to provide customers with a “one-stop shop” for automobiles and automobile-related products and services. fleet management. exchange Maruti Suzuki is set to provide a single window solution for all your car related needs. range of products and extensive sales and service network to expand the size of the passenger car market in India.
. Maruti Insurance brings together some of the biggest names in the car insurance industry to provide insurance solutions to every type of car consumer. which offers fleet related solutions. automobile finance. the best place to buy and sell reliable used cars. It captures the Indian tradition of honouring guests. That's why they have Maruti True Value. services. Then. in Sanskirit. insurance. 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. finally. there is N2N. Similarly. Whether it is easy finance. they continually seek new ways to utilize their vast car parc. It's also the inspiration for the welcome you’ll receive at a Maruti Suzuki dealership.
HMIL has recorded a growth of 27. the Elantra in the D segment.26% over year 2004. which will produce 300. Getz in the B+ segment. the Sonata Embera in the E segment and the Tucson and Terracan in the SUV segment. HMIL
. the Accent in the C segment. HMIL’s fully integrated state-of-the-art manufacturing plant near Chennai boasts some of the most advanced production. It achieved a significant milestone by rolling out the fastest “200.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. which will be increased from 157 to 200 this year. HMIL’s service network will be expanded to over 1.000 in 2006. HMIL is India's fastest growing car company having rolled-out over 970. South Korea and is the second largest and the fastest growing car manufacturer in India. HMIL has announced plans for its second plant.2% in exports over the year 2004. The company recorded combined sales of 252.000 cars in just over 80 months since its inception and is the largest exporter of passenger cars with exports of over Rs. In continuation of its investment in providing the Indian customer global technology.000 per annum by 2007.1 million square meter site adjacent to the existing facility . The Santro in the B segment.800 crores. HMIL plans to expand its dealer network. 1. Apart from expansion of production capacity. HMIL presently markets 31 variants of passenger cars in six segments. The plant will be built on a 2. quality and testing capabilities in the country. And with the company’s greater focus on the quality of its after-sales service.HMIL is investing to expand capacity in line with its positioning as HMC’s global export hub for compact cars.000 units per annum.851 during calendar year 2005 with a growth of 17. raising HMIL’s total production capacity to 600.000th” export car. The year 2005 has been a significant year for Hyundai Motor India.
More than 3 million Tata vehicles ply on Indian roads making Tata a dominant force in the Indian automobile industry. Every stage of product evolution-design.
.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. Their manufacturing plants are situated at Jamshedpur in the East. Hyundai Motor India is on the threshold of yet another grand milestone of rolling out its ‘One millionth’ car which is expected soon. It would be no exaggeration to say that Tata Motors provides the wheels for India's growth.
Propelled by the strong performance in year 2005. is carried out meticulously. launched in 1998. Tata Motors is India's only fully integrated automobile manufacturer with a portfolio that covers trucks.50. reached the 2. development. Tata Motors has the unique distinction of giving India its first and only indigenously built passenger car . manufacturing. The Indica.
Tata Motors is one of the largest companies in the Tata Group with a total income of US$ 2.35 billion. assembly and quality control.
Tata Motors owes its leading position in the Indian automobile industry to its strong focus on indigenisation. utility vehicles and passenger cars. buses.The Tata Indigo. This focus has driven the Company to set up world-class manufacturing units with state-of-the-art technology.000 sales mark within 52 months of launch. Pune in the West and Lucknow in the North.The Tata Indica and the premium feature sedan .
It is among the top five industrial corporations in the world and is available in more than 200 countries around the world. which is going up to 92% soon. advanced service equipment and dedicated consumer satisfaction are the are its plus points which is being followed by the entire industry. Presently offering seven different models. located roughly 45k. To be doubly sure. A project that has been set up with a investment of Rs. equipped with state-of-the-art vehicle manufacturing technology from Ford. Lincoln.Ford India Limited
The Ford Motor Company has a rich legacy of translating better motoring ideas to the roads.m. Its intensive manpower training.C (New Overall Vehicle Audit . 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. Mercury and the Jaguar.00.The plant has the capacity to manufacture 1.from Chennai. Ford India Limited (FIL) is catching up fast with the Indian consumer. At Mahindra's dealerships are present trained professionals who provide the best levels of service in India.up with Mahindra Motors to manufacture the Ford Escort. The Maraimalai Nagar Plant of Ford India Limited. currently Ford has a 78% stake. Ford India Limited is a subsidiary of Ford Motor Company. This is secured through a quality check program based on the principles of NOVA . Acknowledgement has come in the form of the J D power 1997 India Initial Quality and Customer Satisfaction Awards.000 vehicles per annum. Ford has entered the Indian market through a tie .1700 crore.Customer) wherein daily random checks are conducted from a customer's point of view. 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.
. routine calls are made to dealerships to check the quality of cars delivered to them. provides employment to over 20000 people. It has manufactured notable brands such as the Ford.
With sales volume going up.155 cars in 2003 registering a growth of 73% while overall passenger car growth during the year was only around 23-24%. 1999. The Chevrolet Forester and Opel Vectra are sold as CBUs (Completely Built in Units) and as imported from Japan and Germany respectively. and Chevrolet Tavera. GM India entered into a 50% Joint Venture partnership with Hindustan Motors and modernized the 45.K. Chevrolet Optra. Birla Group of Companies. became a fully owned subsidiary of GM in 1999 when GMOC bought the remaining shares. GM APH LLC currently holds 86 percent of voting shares.000 units. 45 kilometers northwest of Vadodara. Similarly in 2004. GM India is expected to register a growth of 90% over 2003. The existing GM India plant was originally built by Hindustan Motors.155 units while 2004 figure is expected to be around 27. The SPO business was integrated with the main business in the same company in 2000. The company was restructured in 1999 and was converted from a Public Limited company to a Private Limited company. These included 9191 Chevy Optras in Entry 'D' Luxury sedan segment. incorporated in 1994 as a 50-50 joint venture company with the C. In 1994.000-square-meter plant near Halol.General Motors India
General Motors India. In 2004. The sales volume in 2003 was 15. The plant produces the Opel Corsa. first one is ‘South
. In February. GM bought the holdings of Hindutan Motors and GM India became a 100% subsidiary of General Motors Corporation of USA. the company sold a total of 26. Corsa Sail. In India. GM strengthened its presence with new product launches Chevrolet Optra in 2003 and Chevrolet Tavera (Multi Utility Vehicle) in 2004. the market share of GM India has gone to nearly 2%. Toyota Motor Corporation is the third largest automaker in the world.166 cars as against 15. and Holden (Australia) holds 14 percent. 8369 Opel Corsas and 8417 units of the new generation premium multiutility vehicle (MUV) Chevrolet Tavera. in the western state of Gujarat. They have 34 dealers in India and in Delhi they have 2 dealers.
They provide Periodic maintenance schedule. They target only high profile 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. events. They reach to the customers either by distributing Leaflets. they provide one booklet in which they give simple and useful tips for maintenance of the car. 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. adjustment and lubrication that will keep vehicle in the safest and most efficient condition.7 month. Brochures to the customers. Toyota) they are giving free
.3. which will ensure that vehicle. is kept in best able-bodied at all times.Delhi Toyota’ and second one is in Moti Nagar in which I have visited during my survey. 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 offer good schemes like providing free Test Drive worth Rs 250 petrol at the time of sale of any car. various cash discounts like currently they are running one discount scheme on purchase of any of their car (Innova. The maintenance schedule may include periodic inspection. 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. To promote their product they organize exchange mela. They build customer loyalty by giving happy calls to the customer after sale of every 1. 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 do road shows to attract customers.
Honda is one of the leading manufacturers of automobiles and power products and the largest manufacture of motorcycles in the world. which is in Najafgarh Road.
. They target either existing or their perspective customers by giving advertisement in the newspaper or through there satisfied customers which give references. They do surveys to know customers need. This Credit Card will give Toyota customers a better payment flexibility and convenience. only through this they are able to make good sales. They launch one “Co Branded Credit Card” to provide additional benefits and services to the Toyota customers. Honda's Civic perhaps drew the maximum attention. All employees of Galaxy Toyota shall consider how they should act and how they might change their ways to benefit the company. like Customer gets free service voucher with the card. They have one Guest Book in which they store valuable comments of customers. They provide 4 free services after sale and with full clean diesel. which will help them to improve their service.accessories worth Rs15000. They have a good superiority with superior brand name in the country. I have visited one of them. which held in New Delhi. They don’t believe on targeting competitor’s customers because by not doing so they have such a brand reputation with good quality products. In New Delhi they have 6 dealers. They are now focusing on their new model ‘Civic’. Personal accident insurance coverage: Up to 20 lakhs etc. Special Invite to co-sponsored events. They have 20 dealers in 42 different cities around India. During my survey I get to know that Honda City Model is the second largest selling car in the ‘C’ segment. They display their models in 8th Auto Expo. which they think are very important for them. The reason is simple: Civic is a new car from the house of Honda.
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. 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. This Dealership even provide technical skills and techniques to their employees that how to deal with the customer thoughtfully every after 6 months. 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. Customers who don’t 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. They make maximum of their sales from the fresh customers rather than their repeat purchasers. telephone and sometimes by letter.
. To judge customer satisfaction they some times invite their customers to have a get together.They prefer to have mode of communication with the customer through mail.
larger companies that have more complete product lines targeted at existing and new markets. Deteriorating economic conditions result in a drop in consumer confidence. and comparable prices. further increasing pressure on prices. suppliers. Low-cost manufacturers are expanding beyond their home markets with entry level vehicles. traditional passenger car manufacturers are expanding into the light truck markets. At the same time. they have started to slow recently due to the current global economic slowdown. Relations between the car companies and their suppliers traditionally have been difficult. 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. Consolidation has heightened competition in all vehicle segments. consumers find it difficult to exhibit brand loyalty because vehicles have unclear brand identities. Regional economic fluctuations favor consolidation among car companies. While vehicle industry sales have been strong for the past several years. The resulting decrease in margins and the reduction in volume due to slowing sales have
. government regulation and consumer demands for sophisticated features have increased development. suppliers have been forced by the car companies to provide higher-quality components at constantly lower costs. similar features. an overpopulation of dealers has resulted in local and regional competition among same make dealers. production. As a result of these product and market extensions. In response to competitive pressure. and retailers -resulting in fewer. This further reduces margins and damages the brand images the car companies spend large amounts of money to build. 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. and luxury manufacturers are moving down market with passenger cars and SUVs. In addition. and marketing costs.NEED FOR CRM IN AUTOMOBILE INDUSTRY The global automotive industry exhibits most of the characteristics of mature industries and closely follows their business cycles.
Only with an infrastructure that enables the
. Therefore. service. In the mature automotive industry. To increase sales and gain ground in the market share battle." These difficult relationships have prevented car companies and dealers from maximizing the lifetime value of their combined customers. 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. Independent entrepreneurs who view some of the car companies with skepticism or serious mistrust. the integration of the dealer network is absolutely essential to improving the quality of the customer experience.the dealer network is a critical component of customer-facing operations. where business cycles drive sales fluctuations. To achieve these related objectives.The long-term battle for market share continues to intensify. and household information. In addition.
Difficult dealer relationships and a lack of dealer collaboration As the consumer 's primary touch point . Dealers too have a long history of adversarial relationships with the car companies.increased the pressure to consolidate and forced some suppliers to the brink of bankruptcy. companies must improve their ability both to acquire first-time customers and to develop customer loyalty to their current brands. market share is critical to survival. consumers receive conflicting marketing communications from the two groups.
KEY INDUSTRY PAIN POINTS
Decreasing sales and market share . Consumers are less brand-loyal than in the past. resulting in ineffective management of product. which results in reduced brand value. companies must set an aggressive goal -deliver the best customer experience in the automotive industry. There are few incentives or efficient methods for dealers and car companies to share critical data. and every market segment has an increasing number of vehicle choices.
To improve customer satisfaction and secure customer lifetime value.effective flow of information to and from dealers can companies create a complete view of their customers.With the advent of the Internet as a research tool.Car companies must integrate global operations in order to achieve the benefits of consolidation -cost reduction. efficient lead generation and management. and leverage provide shared seamless customer management between
information to create rewarding experiences and to develop and execute highly targeted marketing campaigns. interactions. make a phone inquiry. companies must be able to capture these multiple channels. Just as supply chain management must be supported by a sophisticated information infrastructure. Many times. In addition. In addition. internal alignment between business units
Inefficient demand chain planning and high associated IT cost Cost reduction is an ongoing competitive requirement. global automotive enterprises operate a wide variety of IT systems in their various business units and functional groups.
Lack of effective information sharing .
Lack of multichannel capabilities . and true integration of core competencies. enabling car companies to fully leverage each customer relationship through exceptional customer service. effective communication. the majority of customers are accessing the automotive enterprises through several different channels. effective demand chain management also requires the right supporting infrastructure. the switch between channels happens very rapidly as a prospect or customer can view a Web site. Car companies must take the initiative in understanding the customer 's perspective throughout the buying cycle. Rationalizing these systems offers significant cost savings. and effective promotions and campaigns. and visit a retail store within days or even hours of an initial contact.
lack of coordination. The trust required for successful collaboration between groups in the automotive enterprise must be built by demonstrating that customer information can be shared while observing these complex requirements.
Complex data governance requirements . As a result. it must also be protected. Currently. equip employees with effective search tools to
. programs. leading to significant inefficiencies. While customer information must be shared within this ecosystem in order to fully maximize global operations. and marketing is more critical now than ever before. complex information technology ecosystems. Only by sharing customer information can customer lifetime value be maximized among different groups. service.In today 's fast-paced business environment. Organizations must enable employees to make better decisions.and functional groups is required to create a unified view of consumers. and most important. each business unit. an inability to maximize "share of wallet "from every customer through well-targeted marketing and cross-selling. Synergy between traditionally independent business units such as captive finance companies and between functional groups such as sales.
Difficulty managing employee relationships . and maximize productive time. Proper management of customer information requires a sophisticated capability to manage a variety of access rules and to accommodate legal restrictions that can change very quickly. instill a common corporate culture across a geographically dispersed and diverse workforce. automotive companies need to ensure that their most valuable asset -their employees -have immediate access to the critical information. and touch points. and services. and applications required to be productive. Global automotive enterprises must be able to enact and enforce consistent policies across business units. services. and brand operates through independent systems. products. enhance customer relationships. there is limited synergy across the ecosystem. functional group. work collaboratively.Global automotive enterprises have large.
They begin with small concentrated markets appealing to local culture and aspirations of the targeted area
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.access corporate knowledge bases. 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
. THEIR STRATEGY IS TO PROVIDE WORK FOR WOMEN TO CREATE AWARENESS AMONG CONFINED CONSUMERS
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.
Target Marketing Procedure Of Various Companies TARGET SEGMENT
To reach to rural and lower middle class consumers. and provide employees with the training necessary to service customers in a volatile and demanding market.
But many greeting card sites are moving from a 'free' to a 'pay' mode. is divided between ITC. ITC has a five per cent share in the stationery market. mela or local bazaars and most importantly. communication media like telephone and mail facility this mode of communication is possible to a great extent. Through Internet. Archie’s and Hallmark. or through promotional activities like weakly haats. This could be an emerging revenue earning opportunity for content providers. E-mail usage.000 multi brand outlets in over 700 cities across the country.000 greeting card designs have reached these outlets with the help of ITC's web-enabled ecommerce model –Communication Model ITC markets
These days’ consumers are looking for convenience and instant gratification.
'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. 250 crore in terms of yearly consumer spent. While Archie’s has licensing agreements with international greetings brands
. ITC’s extensive Indiawide distribution network enables its greeting cards reach over 12. or through radio. In the last three years.They reach to customers by giving advertisements in the T. through wall painting. The unorganized sector in the greeting card market will be close to 40 per cent. Communication media like the telephone and e-mail facilitate communication to a great extent.V. their policies were flexible and they could adapt to fast changing marketing situations. 10. controlling 60 per cent of the market. The organized sector. The greeting card market in India is estimated to be around Rs.
FINDINGS FROM SURVEY
Total Number of Respondents: 15 Officials Number of Respondents 5 2 2 5 1
Maruti Udyog Limited Hyundai Motors India Ltd General Motors Tata Motors Ford India Limited
Do you face problems in maintaining good and effective relationships with customers?
Quite Frequently Frequently Udyog 2 3 3 2 2 2 1 Average Rarely -
Maruti Limited Hyundai Motors India Ltd General Motors Tata Motors Ford India Limited
Quite Frequently 33%
Findings: According to the responses of the respondents it can be concluded that all the respondents face problems in maintaining good and effective relationships with
This also enables them to extend their relationship with the customer beyond the point of purchase to the entire ownership life cycle. car customers in India are able to access these services through a one-stop shop. With changing customer needs its quite obvious that maintaining good relations with customers need an effort on part of the Dealers and Manufacturers. For HMI's focus and commitment to the Indian automobile customers is of critical importance. they need to continuously work on building their corporate reputation while aggressively positioning their products. established nationwide sales & service network. They believe that the new business initiatives taken by MUL have expanded the scope of this relationship. auto finance. Its been their continuous endeavor to fulfill the entire spectrum of customer needs and desires. Getz. They have therefore. In order to strengthen their position further in the Indian market. across all socio-economic & lifestyle groups.
How well can your company identify its end user customers?
♦ Maruti Udyog Limited: According to the officials of MUL. ♦ Hyundai Motors India Ltd: According to the officials of Hyundai Motor India is at a very exciting stage in India today. For the first time. backed by the leader brand. They are experiencing tremendous growth . scaled up state-of-the-art manufacturing capacity. The way they look at it is that this will provide complete mobility solutions to the Maruti customer.customers. to anticipate and fulfill their needs. Maruti offers auto insurance. the new initiatives enable them to offer Maruti owner’s greater value. corporate lease and fleet management and resale of pre-owned cars in partnership with its dealers. assurance and convenience. Since these services play a vital role in the car customer's ownership experience. launched global-standard cars in rapid succession and exported cars made-in-India across the globe. a much admired lifestyle brand in Europe and
.which is a true sign of enjoying customer confidence. in just 6 years of HMI's young life. the company’s endeavor is to be close to the customer.
Ford India has been revamping all dealerships under the Ford Brand@ Retail. ♦ Tata Motors: According to the officials of Tata Motors the foundation of the company’s growth over the last 50 years is a deep understanding of economic stimuli and customer needs. and the ability to translate them into customer-desired offerings through leading edge R&D. ♦ Ford India Limited: According to the officials of Ford India has reaffirmed its commitment to enhancing the purchase and ownership experience for its customers with the rollout of Ford Brand@Retail concept across the country. addition to HMI's extensive product portfolio. The officials also mentioned that Ford India provides training support to dealers in areas including customer satisfaction. technical and non-technical aspects of the business and in the financial management of the dealership.
Can your company differentiate its customers based on their value to you and their needs from you?
Maruti Udyog Limited Hyundai Motors India Ltd General Motors Tata Motors Yes 5 2 2 5 No -
. Ford India continues to expand its distribution network and will grow to 115 dealer outlets in 79 locations by the end of 2005. which offers great valuefor-money products to its customers. a global corporate identity program to offer a world-class purchase experience to the customer. sales.elsewhere. is a step in the same direction and is a cutting-edge. ♦ General Motors: According to the officials at General Motors is positioned as a mature and responsible car manufacturer. The company leverages its global expertise to manufacture and market well engineered and safe products through its well-established retail network that provide an excellent ownership experience to its customers.
their overall strength lies in building an organization that is sharply focused on the voice of the customer.Ford India Limited
Findings: According to the respondents (officials) at all the Five Automobile Majors their company was able to differentiate its customers based on their value to them and their needs from the company. Buying a new car is an experience customer will remember for a long time and ensuring that this experience is a satisfactory one is essential in building brand loyalty and customer advocacy.
How well do you interact with your customers?
♦ Maruti Udyog Limited: According to the officials of MUL. Maruti's consistent performance over the past several years has resulted in a steady increase in the percentage of its customers who say they intend to remain loyal to the brand. This is important for the automobile industry because the dynamics of selling cars is changing and manufacturers and dealers who fail to meet the rising needs and expectations of their customers will lose out to those who can. n order to be closer to the customers. As a major step in this direction they have started Call Center
. it is essential that we should have multiple avenues of one-to-one interaction with our customers.
value added services. So be it emergency assistance. prices. ♦ Hyundai Motors India Ltd: According to the officials at HMI The Company has set up more than 70 dealer workshops that are equipped with the latest technology. designed to compliment every aspect of owning a car and ensuring complete peace of mind.service with toll-free number for the people of National Capital Region in year 2000. The objective of this service is to ensure that customers have quick and easy access to all information on their models. Anytime Maruti can help them deciding amongst various Maruti Models and benefits of buying from Maruti.specially equipped Santro that can provide emergency service to all its customers anytime. The Anytime Maruti Call-center can also be accessed using telephones on other networks by dialing 09811801515 (not toll-free). The toll-free service is 1800 1800 180. customers can call 24-hour
. thereby providing a one-stop shop for a Hyundai customer. For any car related query or emergency requirement. named Anytime Maruti. dealers. This service. Customers in over 700 cities/towns across India can contact them any time during the day and all days of the week. they have introduced the GM Service Plus – a unique cluster of services. The customers can also call on 1800-114645 (Toll Free Only from MTNL & BSNL numbers) 011. Customers can be assured of yet another great moment from General Motors. body and paint shops. anywhere. For prospective buyers. it is accessible from any fixed-line or mobile phone of BSNL/MTNL network across the nation. an urgent car servicing or even sourcing genuine accessories. and the locations of our numerous service stations. Anytime Maruti helps customers to learn more about their Maruti Cars and also about other services offered by Maruti. across the country. machinery. and international quality press. is now available nation-wide. Hyundai also has a fleet of 78 emergency road service cars .26924645 (For all GSM Connections / Landline other than MTNL & BSNL numbers) for any queries & customer complaints. to bring greater value and service to customers. ♦ General Motors: According to the official at GM. finance options.
When your vehicle needs a repair or a component replaced. With their 24-hour workshops. Brakes.
. ♦ Ford India Limited: According to the officials at Ford solutions aims to provide quality. The unique 3-hour service programme comes with a promise of servicing your car in just 3 hours. shocks. Widespread sales and service outlets across the country ensure that you have the assurance of great service wherever you travel in India. Your Ford Dealership is simply the best place to have your vehicle serviced. Ford Solutions serve to develop products for Ford and the Dealer body that enhance customer satisfaction. your dealership is the place to get it. peace-of-mind products for the customer and embodies a brand synonymous with its ability to provide products that can be tailored to suit one's individual needs. when they use it the least. or you get the service free. ♦ Tata Motors: according to the officials of Tata Motors the company has strengthened its distribution and customer care network and today has 77 dealers and 230 authorized service outlets spread across 119 locations in India. you need Quality Care service. batteries or anything your vehicle may need. customers can now conveniently get their car serviced. Customers can place a online service request at Ford.assistance at 30308080.
.How well does your company customize its products and services based on what it knows about its customers?
Maruti Udyog Limited Hyundai Motors India Ltd General Motors Tata Motors Ford India Limited
Highly Customer centric 5 2 2 5 1
Somewhat Customer centric -
Not Customer centric -
Somewhat Customer centric 0%
Not Customer centric 0%
Highly Customer centric 100%
Findings: All the officials of the Automobile Majors agree that all products and services are highly customer centric and based on the information they know about the customers.
.Does the company have established quality assurance processes?
Maruti Udyog Limited Hyundai Motors India Ltd General Motors Tata Motors Ford India Limited Yes 5 2 2 5 1 No -
Findings: According to all the respondents their respective companies have established quality assurance processes.
Though it is an international product. the car has been totally re-engineered for Indian market requirements. They have been targeted at different segments and they presently witness a healthy mix. As per officials of GM the Tavera is a classic case of an India-specific product. As this segment evolves they rationalise the variant strategy and add or delete variants to meet market requirements. They have
. At Hyundai Segment-needs and budgets are specific and a suitable variant strategy is inevitably required to meet different segment-needs and to be a volume player in the segment. The variants are decided after considerable research.Does the company take customers' needs into consideration when selecting and implementing technology?
Maruti Udyog Limited Hyundai Motors India Ltd General Motors Tata Motors Ford India Limited Yes 5 2 2 5 1 No -
Findings: According to all the respondents their respective companies take customers' needs into consideration when selecting and implementing technology.
put in place a customer contact programme where they interact with customers in groups as well at an individual level at regular intervals to assess their needs and overall experience with their product. This enables them to provide the customers with state of art products and service to customers. The typical Indian consumer looks for value and does not mind paying a little more for it. airconditioning and reliability along with ease of service and low cost of ownership are major considerations during the purchase process in India. Employee and Dealer Training is a part of every company Customer Service Initiative.
. Fuel efficiency.
Does the company provide its employees with technology that enables them to help customers?
Maruti Udyog Limited Hyundai Motors India Ltd General Motors Tata Motors Ford India Limited Yes 5 2 2 5 1 No -
Findings: According to all the respondents the company provides its employees with technology that enables them to help customers.
Maruti Udyog Limited Hyundai Motors India Ltd General Motors Tata Motors Ford India Limited
Yes 5 2 2 5 1
Findings: According to all the respondents they have proper information about their most profitable customers. According to the officials Customer and Supplier Feedback are gathered through Call Centers. Sales Interaction and calls to collect relevant information needed to maintain good customer relationship. Companies use Informal Meetings. Mails and
. The most effective companies like Tata Motors use all the above while most of other track the data during sales interaction. All the Automobile majors surveyed used CRM software for tracking Customer Information.
How effectively does the company combine information on customers with its experiences to generate knowledge about its customers? Highly Effective 4 2 2 3 1 Somewhat Effective 1 2 Not Effective -
Maruti Udyog Limited Hyundai Motors India Ltd General Motors Tata Motors Ford India Limited
Somewhat effective 20%
Not Effective 0%
Highly Effective 80%
Findings: All the 80% officials of the Automobile Majors their company highly effective in combining information on customers with its experiences to generate knowledge about its customers while 20% said that the company was somewhat effective.Direct Interviews.
. There are other methods too but the above three are the most cost effective.
1 Quality & Brand image. and includes issues such as fulfillment of commitments and lack of hassles during the sales process. Hyundai offers service for less. Maruti entered the Indian car market. This new initiative will strengthen the Vendor quality organisation and will ensure the major part quality improvement such as Six Sigma Activity. ♦ According to Hyundai Motors (India) Officials: Hyundai's big hit was its compact family car named Santro which became a huge hit with its launch and capture hearts of millions with increasing satisfied customers day by day. When Hyundai forayed into the Indian market it moved quickly to set up a network of dealers and service stations . 2006 primarily focusing on achieving the Global No. Correct Quantity & Correct Location and 5S – Sorting. With high customer satisfaction ratio and Total automobile value these objectives shaped Maruti as big Giant in the field of automobiles. Service was identified as a powerful differentiator to the way things were done and word of mouth did the rest.
. to provide fuel efficient. accounting for 37 per cent of the SSI score.What steps has the company taken to improve the total experience of its customers?
♦ According to the Maruti Udyog Limited Officials: Sales experience is the most important factor. Hyundai Motor India Ltd (HMIL) launched “Achieve Q1P1” quality campaign on March 24. Also. which were reliable and of high quality. training and improve the Tier 2 suppliers. it's easily reachable and allows flexibility and customers appreciate that. these are advanced cars. The campaign will also help the suppliers to improve their 3C5S (3C – Correct Container.it has close to 260 of the latter. The campaign has been initiated across the Hyundai vendor fraternity. low-cost vehicles. which can't be repaired by a corner mechanic. It was one of the ways to keep the Hyundai customer within our fold. It also offered customers a friendly sales and after sales service. overall honesty and integrity of the dealership personnel and sufficient time to make the decision.
Being the world’s largest car manufacturer. benchmarking activities and upgrade quality systems. They are working towards introducing products to match our customer’s dynamic lifestyle. improved ground clearance and upgraded air conditioning to satisfy the specific needs of the Indian customer. they have access to a range of products through their global alliances. They have improved the horn and the steering column switch so that they are more robust. Standardizing & Self-Discipline). Sustained brand building efforts coupled with intensive ground-
. They have also developed a hydraulically activated clutch system. They have consistently adapted the specification of the Ikon to ensure it meets the needs of Indian consumers. They look for customers for life who will have a choice of products to buy from their stable. Satisfying our customers They have introduced initiatives to assess customer satisfaction and to act on their concerns.Systematizing. This is part of a continuous improvement process. they are focusing on the fast growing MPV segment with the Chevrolet Tavera and have invested substantially in this product line. They are already present in most segments and will shortly have products in additional segments. However. TPM (Total Productivity Maintenance). Ford India Limited (FIL) is catching up fast with the Indian consumer. • Vehicle quality concern • Design and general comments • Negative sales and service ♦ According to GM officials: General Motors target is to offer a choice of products to their customers to match their different needs and budgets. Shining. According to Ford India Limited officials: Presently Ford is offering seven different models. products which have progressive styling and are great to drive. the new combination switch has proved so effective that it is used worldwide. FIL was the first subsidiary of a multinational car manufacturer in India to launch a car designed specifically for India. The Intensified Customer Concern Definition (ICCD) is a telephone survey of customers conducted to assess problems in three areas: They recognise the need for additional products.
Improved accuracy of dealer-captured information. the company is today among the world's top 10 producers of commercial vehicles.8 billion in 2001-02. making interpretations difficult and resulting in inefficient planning for capacity and spare parts. It is today one of the biggest and most prominent companies in the TATA group. With legacy-based systems. These vents go a long way in building goodwill and brand loyalty. and the only fully integrated automobile manufacturer. The winners of these rallies are given healthy cash rewards. They also have a regular Customer Relation Management programme whereby existing customers are offered loyalty programmes and great offers. So far. which has received a very positive response and given us rich dividend in terms of brand building and imagery. with an annual revenue of $1. the environment produced inconsistent data. ♦ According to Tata Motors Officials: TATA Motors is India's foremost. Collaboration between vehicle manufacturers and dealers. they have organised six Optra Max Mileage Rally meets where Optra customers compete to extract the best fuel efficiency out of their cars and all participants are treated to an overnight stay at an exotic locale with an evening of entertainment. A product refreshment plan ensures that they remain competitive and are ready to meet future challenges in this segment. to manufacture locomotives and other engineering products. Established in 1945 as TATA Engineering & Locomotive Company (TELCO). They have refreshed the product through continuous product improvements and have emerged as segment leader in fuel efficiency. TATA Motors was also previously known as TATA Engineering.level activity has ensured that Optra has remained among the top two players in its segment. where every dealer managed details. TATA Motors use a manual dealer management system. They have recently launched a limited edition of 150 cars. TATA Motors required a standardised solution that would provide them with:
• • •
Increase in sales and profitability by easy management. Today TATA motors' vehicles run in more than 70 countries.
including improved customer satisfaction. a comprehensive customer relationship management (CRM) solution designed specifically for companies in the automotive industry. Tata Motors strongly believes in customer safety. The company believes that this factor has been vital to the success of the Indica and other products under the company’s passenger car unit. Tata Motors implemented Siebel Automotive. TATA Motors chose IBM as its partner to provide an infrastructure solution. Customer Safety and satisfaction 4. Commitment to quality manufacturing standards 2. increased revenue and productivity. improve capacity planning and increase profitability. Seamlessly integrated with Tata Motors’ dealer management system and SAP back-office applications. Siebel Automotive has delivered significant benefits across the extended organization. Developing new products 3. a cyclical business environment. IBM created a Siebel solution to provide a DMS solution for TATA Motors and then provided a reliable and scalable IT infrastructure for developing and deploying its DMS application. and reduced costs.1. The IBM solution has simplified the IT infrastructure for TATA Motors.
. a more comprehensive view of customers. Tata Motors established a crash-testing facility. The small workforce of 21 members including engineers aims to control the serious risks and intrusions in accidents. With reengineered business process. A strong feedback mechanism and interface for communicating with customers. the only one of its kind in the country. the company can also analyse customer interactions and other information more accurately. Apart from providing its customers with high performance automobiles. enhanced customer experiences and improved loyalty. The benefits include . The key things that the critical people spend time on 1. Global expansion Norms. and the challenge of a widely dispersed dealer network. Several cases have been cited where passengers driving Tata vehicles have been saved after terrible accidents. Faced with increasing competition from abroad. in Pune in 1996.low total cost of ownership.
How much 'influence do customers' needs have on the company's products and services?
Maruti Udyog Limited Hyundai Motors India Ltd General Motors Tata Motors Ford Limited India Very High 3 2 2 2 1 Substantial 2 1 Very Low 2 --
Very Low 13%
Very High 67%
Findings: All the 67%(10) responding officials of the Automobile Majors customer needs have a very high influence on company’s products and services while 20%(3) respondents said that it had substantial influence while 13%(2) respondents said that customer needs had very low influence on company’s product and services.
Corporates, don't talk about exceeding customer satisfaction - that's passe - the time has come to `dazzle the customer'. But to do that, first you must get customer relationship management (CRM) in place. In the context of India, this is very crucial as the recent World Economic Forum Report on Global Competitiveness has ranked India 43 out of 49 nations surveyed, on `customer orientation'. Managing customer relationships is not only complex but is also multi-faceted and thus calls for an inter-disciplinary approach. Particularly, as in the New Economy, the customer has become very demanding and the emphasis needs to be on being consumer-centric. Technology solutions as applied to various front-end functions could aid in building a viable link between the organisations and customers irrespective of geographical separation. This has to be backed with appropriate systems and processes to mine the right type of data by the right function in an organisation. Besides technology, systems and processes, another important link is human resource, If CRM is the key, HR would be the nerve centre for any CRM activity. At Maruti Udyog Ltd the first step for a company to enhance value through CRM was to identify its target base. At Maruti, the categories which emerged were: * Two-wheeler owners; * Customers taken away from the competition; * Services sector. After identifying the target, the next stage was to build on customer relationships. Maruti, therefore, began evaluating the current database of consumers to identify those who wanted Maruti service or better still, wanted to upgrade up the value chain in Maruti products. Third, it began working in tandem with the oil industry to get data feedback on two-wheeler consumers-and identify those ready to move into four-wheeler purchases. Ultimately, CRM is all about value enhancement for the organisation.
Faced with increasing competition from abroad, a cyclical business environment, and the challenge of a widely dispersed dealer network, Tata Motors implemented Siebel Automotive, a comprehensive customer relationship management (CRM) solution designed specifically for companies in the automotive industry. Seamlessly integrated with Tata Motors’ dealer management system and SAP back-office applications, Siebel Automotive has delivered significant benefits across the extended organization, including improved customer satisfaction, increased revenue and productivity, and reduced costs. The Siebel CRM solution enables Tata Motors to gather feedback on products to improve design or manufacturing quality as well as measure the effectiveness of marketing campaigns and programmes. The automaker selected Siebel Automotive because of its partner management capabilities to handle its large dealer network, the solution's zero-footprint web-based architecture and user-friendly interfacecritical to support thousands of salespeople with various skill levels.
Improved demand forecasting, planning, logistics management, and inventory management Overall reduction in quality-related costs due to faster product performance feedback Improved workflow and escalation of customer grievances for faster resolution Increased revenue growth from both higher vehicle sales and a rise in the company's after-sales parts business
Limitations of the Study
Since the road to improvement is never ending, so this study also suffers from certain limitations. Some of them are as follows: Because of illiteracy, it was a time consuming method in which
continuous guidance was required. Questionnaire method involves some uncertainty of response.
Co-operation on the part of informants, in some cases, was difficult to presume. It is possible that the information supplied by the informants
may be incorrect. So, the study may lack accuracy.
Nothing matches the delight their cars deliver. According to TNS Automotive. and costof-ownership. representing the responses of more than 7.CONCLUSION
The price of a car is just one-third of what it cost you over its lifetime. The TCS index score provides a measure of satisfaction and loyalty a given model enjoys with its customers. After the rash of new cars launches the past two years. In the JD Power CSI study 2005. According to the 2005 four-wheeler Total Customer Satisfaction (TCS) study conducted by the specialist division of TNS Automotive. Infact. small and entry mid-size car models. we try our best to keep prices down. the relative lull in the auto industry is showing up in the customer satisfaction indices. brand image. 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.
. Maruti Suzuki stands for value as much as it stands for performance. You invest in it. Take into account resale value and its real cost becomes clear. vehicle performance and design. The comprehensive study covers over 50 models with customer evaluations taken in the key areas of sales satisfaction. you don’t buy a Maruti Suzuki. the automobile ownership experience or customer ownership experience has declined in all areas compared to 2004. 85% of Maruti Suzuki owners stated that they would definitely recommend the car they drive to someone else. The study is one of the largest syndicated automotive studies in India.000 new car buyers. Running and maintaining it make up the other two-thirds. after-sales service. In spite of rising input costs. Their running costs and resale values are unbeatable too. product quality. the decline is predominantly for older.
This year's study shows the Maruti Suzuki Swift and the Toyota Innova as the winners.
. Sales satisfaction is weak in both these models.The study reveals a significant increase in the importance of sales satisfaction. with the two vehicles achieving segment-best ratings by performing well in areas of greater relevance. particularly product and brand image. largely because of the longer waiting time for new deliveries. product quality (both performance and design) and brand image since 2003. indicating rising customer expectations over the years.
indicators and inferences from the 2005 study are: Progressive reduction in car ownership cycle-time from an average of 61 months in 2002 to 53 months in 2005: This shortened cycle-time is bringing these owners for repeat purchases sooner and will.TNS Automotive's TCS Study has. This trend is already visible in the growing additional/replacement purchases.000 car buyers and hasbuilt a sizeable sample base. since its inception in 2002. surveyed over 25.
. further fuel the growth of the fourwheeler market. Some of the key findings. Growth in additional (multi-car households) and replacement purchases up from 51 per cent in 2002 to 65 per cent in 2005: This will impact the volume growth in higher-end segments as the current car owners show upward mobility. therefore.
is getting more fuel efficiency conscious and tending towards postponing the car purchase decision due to the high cost of fuel. Small sample models have not been featured in the charts. These include the Fiat Petra Diesel. Hyundai Terracan. Maruti Udyog Ltd is one of India 's leading automobile manufacturers and the market leader in the car segment. Maruti Esteem Diesel. TNS has a global network spanning 70 countries and is listed on the London Stock Exchange. Maruti Suzuki Grand Vitara. Of course a shift in composition is also to be expected with the upper premium compact and mid-size segments projected to grow at a much faster rate than rest of the industry. While first-time buyers are declining as a composition of total volumes. The TCS study was conducted from August through October across 21 cities. Ford Mondeo. the figure in absolute terms is high. fuelled by the up-gradation by two-wheeler owners The study also throws up the question as to whether it is also possible that the first-time car buyer who is generally a two-wheeler owner. and Opel Corsa Sail. Ford Fusion. both in terms of volume of vehicles sold and revenue.Increasing budget for future purchases: Future intenders with a budget of Rs 6 lakh plus have increased from 44 per cent in 2002 to 58 per cent in 2005. Maruti Zen Diesel. Good Technology Uniform Pricing Good Strength More Coverage Area Frequent /Regular Product Launch Market Leader (with 47% share) Oriented Driven Company More Product Offering
Shitsuke) should be put into practice at Dealership Maruti should regard as generous discount offers during Festival Season like Navratra. 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. encashable after a 15year period. Sciso.
. Customers eligible for an income bond.Healthy Annual Report Brand Image Maximum Dealership as compared to other brands Good Sale Service Spare parts are cheap as compared to any other brand Cheap & reliable quality 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 don’t have their specific website All Japanese 5’s concept (Seiro. Sieton. Seioetse. Dusshera.
com www.google. Planning Implementation & Control Edition 1998. Business Today: 15-22May 2000 Name of the articles.BIBLOGRAPHY
Reference Books. Journals. Mumbai: 21st May 2000
www. New Delhi Magazines Jourals & Newapaper Name of the articles. etc are to be listed. Web Sites.com
. Newspaper.maruti. out here Books Kotler Philips. Prentice hall of India Ltd. Reports. Marketing Management Analysis.com www. The times of India .yahoo.