Promotional strategy of RE

20.
RE has adopted several promotional policies to market its products successfully in the consumer
market. The company has launched innovative ad campaigns with help of electronic and print media. Its
ads are viewed via television, magazines, newspapers and billboards.

Social media

RE has also launched brand awareness campaigns at social media portals

like Facebook, Twitter and YouTube. It takes part in several shows to increase its brand visibility. The RE
Facebook page launched in July 2010 has covered many milestones over the two years of its existence.
One of them is the sizeable fan growth which now stands as a 200K strong community. The brand has
been active on Twitter since 2009 and has many followers.

Customer Appreciation Events

RE Himalayan Odyssey also organizes a Women's edition, rough road trips- The Himalayan Odyssey
This is a call to all those who love to ride on tough and testing terrain and have the
passion to ride with us. RE Himalayan Odyssey will also have a Women's edition, and Trips
to Nepal. They also organize events like Rider Mania which was started in 2003 and is now extremely
popular. It gives new and old bikers to meet, share their experiences and show-off their 'custom
tweaked' bikes and also through Wheels and Waves events. They have also promoted themselves
through various movies like Sholay and Zindagi Na Milegi Dobara

Ridermania,2017
Himalayan Odyssey ,2014

Himalayan Odyssey, 2016

Causes and charity

They also do a lot of charity events: - Like the Great Indian Motorcycle ride organized in 2016. This
amazing adventure raised funds and supported national charity - PLAN INDIA. The aim to educate,
build and strengthen the remote communities in the way of establishing schools, hospitals, orphanages
and supporting other charity organizations of our precious and beloved Himalayas is one of their best
initiatives.

Word of Mouth

Royal Enfield relies heavily on the loyalists promoting the brand through word of moutt and is very less
advertised through television.

They want their brand to be considered as an experience rather than utility. They also promote through
magazines and all these advertisements showcases the premium aspects of the brand.

Promotional strategies of competitors

Harley Davidson

Harley-Davidson also uses public relations for promotions by organizing and supporting Harley Owners
Group (H.O.G.) rallies in various locations, to promote and increase awareness about the companys
brands and products. Personal selling is the most significant promotional strategy in Harley-Davidsons
business.

TVS motors

Their promotional strategies involve placing brand ambassadors for each product specific
to geographic division (North India and South India) like Virat Kohli and MS Dhoni for North India and
Actors like Surya and Trisha for south India. The promotional activities include dirt bike rally, MRF super
cross championship rally, promotional events in Malls etc. TVS motors majorly concentrate on rural
markets.

Bajaj Auto

Bajaj usually makes its promotion through advertisement in the print media, magazines newspapers,
televisions etc. It makes creative advertisement to improve the visibility of its auto products.

The major difference between Promotional strategies used by RE and its competitors is that, it uses
Digital marketing communications for promotions like Social media online portals. It also uses direct
marketing channels like campaigns, rallies, catalog marketing etc. whereas most of its competitors rely
on personal selling where they interact face to face with customers, and also rely on print media
marketing through magazines, newspapers etc.

21,23,25
RE pricing strategy

RE is a premium priced bike focussing mainly on the bike adventurers and youths belonging to the
middle aged group as its target customers that believe in quality over pricing at any given time.

The showroom price range ranges from 1,13,000 to Rs 2,08,920, price being different for different kinds
of model. The price for a given model has been relatively constant over the years.

RE uses Promotional pricing strategy to stimulate early purchases of its bikes. It provides various
schemes to their consumers through various schemes.

1.Low interest financing: It provides its customers with attractive financing options on motorcycles,
gears and accessories at best rates with minimum documentation and easy EMI repayment options

Benefits of Scheme

Finance options from Bank and NBFCs

Best Rate of Interest
Minimum Documentation for Salary and Self-employed people
Maximum funding for salaried and self-employed people and those with no income proof
EMI payment tenure up to 5 years
Instant loan approval
Avail a top up loan on gear when you get your RE financed
Offer on gear valid till loan disbursal by the bank

2. Longer payment terms: Customers are provided longer repayment period and lower monthly EMI
payments to increase brand visibility.

3.Special customer pricings: Customers who are the members of the RE riders club are given special
discounts on accessories

4. Warranties and service contracts: RE has increased the warranty of the bikes from 1 year or
10000kms to 2 years or 20000kms whichever reaches first. This new step might come in favor for
improving goodwill and trust among potential buyers, which in turn might increase the sales
Pricing strategy of competitors

Harley Davidson

It is also a premium priced bike and the costliest compared to the bikes in the similar segment. RE
continental GT 750 is priced starting from 3.5 lakhs whereas Harley Davidson Street 750 price starts
from 5 lakhs. Harley Davidson also follows promotional pricing providing discounts and warranties on its
accessories. It follows psychological discounting model. This strategy sets an artificially high price and
then offers the product at substantial savings. Example Was $8000 dollars now $7499 only.

TVS

TVS follows differentiated pricing strategy wherein there pricing strategy varies according to product
category and the consumer segment. The pricing is often economical pricing with focus on quality and
Indian pricing values and sentiments.

Bajaj Auto

Bajaj follows both premium as well as competitive pricing strategy. In some cases, where the company
has decided to enter a new market it has opted for a penetration pricing strategy. This strategy is
generally used by late comers in the market. This pricing is typically used when the market is saturated
or there are already many variants of the same product present in the market.

Additional pricing and promotion strategies in addition to the existing to increase the sales

Pricing- The current pricing strategy followed is favorable since the motorcycles of 150cc & 180cc are
priced at a range of Rs 55000 85000. The aim of the company should be to give better value for the
money spent by the customer. If any changes are made to the existing models and they turn to be
favorable, then the company may follow the pricing technique of Value Added Pricing.

Promotional Strategies The promotional strategies to be followed by the company in combination with
the existing ones in order to increase product awareness amongst the public are as follows,

Advertise for free test rides to the general public.

Give more attention to the product in major exhibitions, fairs and other trade expositions.

By sponsoring local events like fashion shows, rock shows, intercollegiate events, the can capture
public attention.
 By holding regular RE owners meet, which will in turn entice the press directly to give regular write ups
in the papers and thus creating attention towards the company image and its product.

22
Pricing Channels
Royal Enfield sells its bikes in Indian two wheeler markets through a comprehensive network of dealers
spread across the nation. Currently, Royal Enfield operates through 17 company-operated stores
and 496 dealers in all major cities and towns in India, and exports to over 50 countries across the
world, including the US, UK and several European and Latin American countries, as well as the
Middle East and South East Asia. Royal Enfield has been looking at expanding its international
presence as well.

The Royal Enfield portfolio currently comprises of Bullet, Electra, Classic, Thunderbird, Himalayan and
the Continental GT. Of these, the Bullet, Classic and Thunderbird are available in two versions powered
by 350cc and 500cc engines. While all the models have stayed true to the companys traditional
character, a few specific models do get their share of modern tech in the form of fuel injection,
projector headlamp and digital instrument cluster.

Royal Enfields distributors are also working with different exports markets and have appointed dealers
in various locations who finally run the multi brand outlets. With a new assembling plant opened in
Chennai, Royal Enfield is able to tackle the problems of product shortage and they easily export the
products to all the nations through ship route. Even after this there are few nations where shipping is
not that easy like Brazil due to various policies so Royal Enfield is looking to open local assembly and
manufacturing plants. Royal Enfield has a vast and strong distribution network which incorporates the
goals of merchants and dealers so that customer needs are satisfied without any issue. Royal Enfield
targets both urban and rural consumers in India however urban consumers are favored a little more
seeing the past purchase records.

Models:
1. Royal Enfield Classic 350 1.35 lakh onwards
2. Royal Enfield Bullet 350 1.13 lakh onwards
3. Royal Enfield Himalayan 1.65 lakh onwards
4. Royal Enfield Thunderbird 350 1.46 lakh onwards
5. Royal Enfield Classic 500 1.70 lakh onwards
6. Royal Enfield Continental GT 2.08 lakh onwards
7. Royal Enfield Thunderbird 500 1.88 lakh onwards
8. Royal Enfield Bullet 500 1.66 lakh onwards
Upcoming Models:
1. Royal Enfield Continental GT 650 4.25 lakh onwards
2. Royal Enfield Interceptor 650 3.50 lakh onwards

24
Factors affecting Price of RE

1. Political and Legal: Implementation of GST in July 2017 has impacted the prices of the auto
sector. With the implementation of GST . Tax slab of 28 percent has been imposed on the two
wheeler motor vehicles. This has reduced the tax of more than 2 percent on 350cc (Example : RE
Thunderbird 350) RE bikes and increased the Tax of more than 3 percent on 350cc and above
bikes (Example: RE Himalayan). RE has passed on these benefits by reducing the price of Bikes
under 350 cc.
 2. Economic: Indian economy is growing at a significant rate which has a positive impact on the
standards of living. There is already a great demand of Royal Enfield among the target group and
with the increase in the disposable incomes, the price of the RE bikes can be varied.

EXTRA INFORMATION

Changing strategy

As Siddhartha Lal, Managing Director & CEO of Eicher Motors puts it, What we have figured over
the years is that automobile companies are generally engineering companies. The rest of it is just an
afterthought; you make a vehicle, design and manufacture it and then figure a way to sell it.

In other words, this is the traditional approach and Lal adds that it is not his intent to undermine the
importance of engineering. Conceptually, we have taken a mind shift to wanting to be a consumer
brand first: a company which understands the need of the hour as a consumer brand and consumer-
driven organisation, he says.

Therefore, instead of the back driving the front, Royal Enfield would rather have the front driving the
back. The products are not just driven by engineering but strategy which is about understanding
consumer, markets and technology. We now take a world view of what the company needs to be and
it is all about consumer thinking, says Lal.

The idea is to build on the fact that Royal Enfield is the best bet for leisure motorcycling in India. The
big shift from a B2B to B2C goes beyond just selling bikes to the riding experience. Eventually, it is
about the about number of test rides and communities Enfield builds in India and overseas.

The big change within the organisation is to how to live the story before telling the story. We have a
long way to go and the recently launched Himalayan is a big step in that direction, says Rudratej
Singh, President.

Selling an experience
Today, Royal Enfield increasingly wants people to invite and search its motorcycles and this is where
the showroom experience becomes important. We want to be the best relationship company in the
world and not the best marketing company. Marketing limits the scope and the passion to deliver
while relationships create the business, adds Singh.

It is this thinking that Royal Enfield will replicate across markets like ASEAN and Latin America
where it is keen to be considered as the definitive choice for mid-weight bikes. Like India, the idea is
to replicate the experience of rides, communities, spares and sales to create the pull. From our point
of view, it is about fitting into what people want, says Singh.

Lal chips in to add that the idea is be a motorcycle company which is just not driven by products but
the entire experience. The Himalayan, for instance, was driven by the idea of what riders have been
doing for decades with their Bullet motorcycles.

From a product side, it is about engineering and finding the right solutions. From a non-product
side, it is about making the experience a lot better right from features and creating an ecosystem
around motorcycles. We are trying to move from creating an outstanding experience to putting
everything around the brand, says Lal.

The ultimate objective is to get the brand in peoples minds. New markets have already reacted
positively to Royal Enfield and this is what gives the company the confidence that it can quickly get a
foot in the door and then do all the hard work after that. We want to do something different all the
time but will stay focused to our core and not go after every segment. The key is to give business and
pleasure while keeping things simple and fun to ride. It is a self imposed goal in making mid-weight
bikes since the opportunities are enormous, says Lal.

The recently launched Himalayan was meant to reach out to those riders who are now in a phase in
their lives where they would like to do a little bit more, go out and experience adventure. It is their
time off when they want to live and enjoy.

That is what we made this motorcycle for: to enjoy the great outdoors and lose yourself in a way.
Forget about everything else including the motorcycle, he says Lal. The Himalayan was created in a
way that it was a truly a case about form following function.

We made sure it looks pretty and does its job without being too extreme in its nature. This is a
motorcycle that you can use on a daily basis and yet enjoy on weekends and go out on long rides,
adds Lal.

References

1.http://lighthouseinsights.in/social-media-presence-of-royal-enfield.html/

2. https://www.marketing91.com/marketing-mix-tvs-motors/

3. http://www.financialexpress.com/auto/bike-news/bajaj-auto-triumph-motorcycles-to-make-bike-to-
compete-with-royal-enfield-bullet/799325/
4.https://www.bikewale.com/news/31629-india-bike-week-announces-club-outreach-program.html/

5.https://royalenfield.com/finance/

6. https://auto.ndtv.com/news/gst-impact-royal-enfield-revises-prices-of-all-models-1720498

7. http://www.asianage.com/business/autos/220617/royal-enfield-offers-gst-benefits.html

8. http://www.thehindu.com/business/Industry/royal-enfield-is-a-unique-brand-and-it-believes-in-
being-disruptive/article8332100.ece

9. http://www.thehindubusinessline.com/specials/auto-focus/royal-enfield-and-the-new-mantra-of-
selling-bikes/article8253554.ece