Assignment 1: Renault Kwid Case Study

Introduction:

Who says Maruti captures the whole market? Our automobile market has seen a rise
in the number of makers with various designs and advanced features. One of them is
The Renault Kwid. Renault Kwid was launched in September, 2015 and more than
100000 consumers had booked or reserved its offering. It is the first European car to
get such localization for a product. It focuses on a designed strategy which
symbolizes its Dynamic performance, robust strength and taste of adventure.
With a 98% indigenous supply chain and aggressive pricing, the car established a
foothold in the entry level segment. To improve the distribution and service, Renault
drastically increased its number of dealers and service centers from 14 to
255.Growing in demand, many first car buyers chose Renault cars.

In a short span of 6 years, Renault was expected to achieve 5% of market share.

As fuel is a very crucial factor in india, the kwid excelled it with a rating of 25.17
kilometer per litre which claimed that it had the most fuel efficient rating in the
country. Renault India’s Kwid sales surpassed Renault Russia’s number to become
the fourth largest global Renault market

Question 1: Examine the shifting customer insights in the Indian automotive

market as described in the case study which formed the basis of Renault Kwid’s
success. Also, describe Renault Kwid’s Marketing Mix strategy.

The shifting customer insights in Indian automotive market are to be examined

based on the given case study, which had really played a major role in KWID’s
success story.The Society of Indian Automobile Manufacturers announced the sale of
passenger vehicles in April 2015 to February 2016.

The consumers have shifted their preference and evolved much from the past years.
Earlier when people used to buy cars they believed in functionality but now they give
design and looks more preference. Although Kwid was able to fully give justice to its
aesthetic looks and style compared to its Maruti and Hyundai competitors, it was
successful in stealing the limelight among the consumers in the market.
Segmentation Renault Kwid segmented their market heavily based on demographics;
particularly age, income & generation. Geographic wise they targeted
entry level hatchback market of all Tier 1, Tier 2 & Tier 3 cities.

Targeting Renault’s target was the Middle class & Aspirational income group of
consumers, Based on the segment size & competition .They are the
consumers who were heavily driving the entry level hatchback car sales
of Maruti Suzuki & Hyundai. Hence, these consumers adopted the
concentrated Target marketing strategy to achieve a substantial share
of a large market of entry level hatchback cars.

This targeting very well fitted with Renault’s objective of launching

KWID into the entry level hatchback segment.

A massive competitive advantage to KWID over its competitors was

Positioning given when Renault differentiated their product from that of the
competition by giving KWID a robust SUV styled design packed with
other features like genuine interiors, digital infotainment and more.
The Unique Value Point (UVP) of Kwid was that it had created a vision
of adventure, style & modern sporty vibes in the minds of the target
market.
 Marketing Mix of Renault Kwid

PRODUCT PRICE

KWID as a product was packed with industry In order to penetrate the highly competitive
first features as a highly fuel-efficient car, market, Renault Kwid entered a Red Ocean
robust, stylish, SUV styled design. with competitive pricing

PLACE PROMOTION

Renault focuses on selling small cars in India.
Small cars are the most popular car segment in
India, owing to the country’s large middle class
population. Renault took advantage of the
growing automobile sector in India coupled
with the favorable laws and policies by the
Indian government to boost the automobile
sector.
Kwid was very uniquely marketed. A kwid
was hung from the ceiling of Mumbai
Airport, enabled customers for easy
interaction through virtual showrooms and
book via Kwid mobile application. This made
Kwid attract a lot of customers with the
tagline ‘Live for More’.

Question 2: Is Kwid a marathon runner or a sprinter?

During their journey over since the initial stages, Renault have rapidly expanded
their presence both geographically as well as with swift product introductions – They
launched five new products in quick succession. They are entering the growth and
volume drivers of the Indian automobile industry. Renault has a clear-cut plan
chartered not only for 2015, but are looking at a long-term horizon and working on
our product strategy for years to come as well. So Renault continues to work
towards the goals of leveraging their position of being the number 1 European brand
in India, achieving a five per cent market share and becoming one of the top 3
international brands in India in terms of sales and customer satisfaction.

So to succeed in a country like India one needs to have a strong distribution network
and manufacturing base with a long term point of view. While product-wise Kwid is
geared up they are also ramping up their network. At the start of 2015 they had an
alliance plant at Oragadam that had the capacity to build more than 480,000 cars a
year. They also have a technology centre in Chennai that has over 4,800 people who
are working for future technologies. There have been auto brands in this country for
over 10 years and their volumes are not very high. But for a brand which is relatively
new, their progress is good. They have definitely arrived with a long term point of
view of staying in the market. So yes, the Renault Kwid is a Marathon Runner.
Question 3: What kind of product portfolio does Renault India have?

The passion for Renault is that it is the number one French brand worldwide, sold in
134 countries, Renault has been making its customers’ lives easier for 120 years.
With its sensual and warm design, leading position in the European electric vehicle
market, and motorsport commitment, the brand is driven by passion in all its
projects. The elegance and quality created in 2000, the brand ranks in the top five
carmakers in South Korea with a range of seven sedans and SUVs. Highly reputed for
its service quality, the brand was voted number one in customer satisfaction in sales
and after-sales in 2017 for the fifteenth consecutive year. In January 2017, LADA was
the long-standing leader in the Russian market. It boasts the country’s largest
dealership network with 300 points of sale.Present in 44 countries in Europe and in
the Mediterranean Basin, Dacia has won over nearly 5 million customers since 2004
with simple, reliable and affordable vehicles.

In 2018, the Alliance formed by Renault, Nissan and Mitsubishi Motors became the
world leader in sales of passenger cars and light commercial vehicles with over
10.6million units. Considering sales by region in 2018,Europe had sales nearly
19,11,169 followed by Eurasia 7,32,786 and sales nearly 5,38,941 in India,nAfrica and
195,869 in Asia-Pacific. By December 31, 2017 the revenue can be seen +14.7% that
had a upscale collection of 58,770 Euros.
BCG Matrix
⚫ Based on the Renault India growth share market out of 7 only 3 were
successful at the time of introducing into the market.Duster,Kwid and Pulse grab
the place under star having over sales unit of 7500 with Kwid being sold highest
with minimum average price.
⚫ Renault does not have any Cash cow products as majority of the produces fall
under question mark and dog category as to generate constant revenue for new
activities.
⚫ Having 3 of its products in Dog namely Scala,Koleos and Fluence, marking sales
in single numbers they were either not successful or failed to generate big sales
and thereby leading to low market share with a total sales value of 86.51(in
millions).
⚫ Lodgy having a Low market share and high Market growth rate it falls under
the category of Question mark with sales price of INR 820,000 having market
value greater than Pulse,Scala and Fluence.
Question 4: If you were to change the Kwid story, what would you change as a
marketer/consumer?

Renault Kwid has smartly placed itslef with a perception of Italian Deisgn (Inspired
from Exisiting Hit Product - Renault Duster), Value for Money (Competitive Pricing
Strategy via Localization), Comfort Ride (Raised Ride Height, using Differentiation
Strategy, creating a SUV like experience for the consumer) and Accessibility (by
growing a vast network of Sales Outlet and Service Centres). Under the Quality
Aspect, as per customer's perception, the Renault Kwid has given a tough competion
of the exisiting segment leaders like Maruti Suzuki Alto and Hyundai Eon, as they are
able to provide ample amount of features and after-use satisfaction. Under the Price
Aspect, as per customer's perception, the Renault Kwid is able to compete with the
lowest priced competitors, as they are majorly using locally sourced parts for
manufacturing and keeping a very low cost of production. This perception is highly
favourable for Renault Kwid and making it a highly successful product. The same is
visible in the market, as there are not many competitors in the lowest priced
segment of four wheelers. The ever growing demand of vehicles in Indian Market,
this move from Renault will prove to be highly profitable. Hence, a product was
delivered at the right time and with a reasonable price tag
CONCLUSION

The present study was concluded by looking into the case study of Renault Kwid and
examining the reasons behind the massive success of Renault Kwid.
By looking into the study it is revealed that :
⚫ Renault Kwid focuses on a strategy design that symbolised dynamic
performance, robust strength and taste of adventure which was not provided by
its existing competitors Maruti and Hyundai.
⚫ Renault made lots of profit due to Duster standing out in the cluttered market
and was trying to encore performance with the launch of Kwid and become the
biggest mega manufacturer of Automobiles in India.
⚫ Renault with the release of Kwid made it clear that it paid attention to the
environment. Though India is not a super rich country, it planned and launched a
family yet economical car which wouldn’t burn a hole in the pocket of
consumers.
⚫ The impact of Kwid was so powerful that the competitors in the market grew
insecure about losing its customers which burdened them to step up their game.
Also it is said that if competitors start copying you, then you are doing
something right! This is what Renault was so proud of that it was successful in
creating a bang with the launch of Kwid in the market.
⚫ With the capacity of 400,000 cars per year, the Renault plant in Chennai was
able to employ 1500 workers which improved the employment ratio in the
country. Hence setting a milestone by registering growth of 160% in domestic
sales of Kwid in the year 2015.
⚫ To make their dream come true about being ultra successful , they recorded
highest sales at 12972 units sold by Aug 2016.
⚫ They became first in their domain to provide Bluetooth technology, best in class
ground clearance , genuine interior trim and SUV style design body to give the
customers a hard time to close their eyes to .
⚫ Majorly we could understand that the success of Kwid was due to the fact that
Renault India decided to develop a local supply chain with vendors who were
able to innovate and supply components at competitive prices and in order to
improve distribution and service, Renault increased the number of dealers and
service centre around the country to make themselves more closer to the
consumers. This indeed was a revolutionary move in the era of marketing to be
the game changer in the market.
Hence we conclude our assignment with the thought “ MARKETERS ARE KINGS BUT
CONSUMER IS QUEEN, AND THE LADY RULES THE HOUSE!”