Name Subham Pandey

Question 1

Answer 1A

Period Rate of Growth

2000-2004 27.27%

2004-2010 90.47%

2010-2015 50%

Answer 1B. The 3 factors responsible for growth of 2-wheeler market in India are:
➢ Consumers' increasing disposable income
➢ Aspiration to own a motorized vehicle
➢ Availability of easy financing

Answer 1B.

The 3 factors responsible for growth of 2-wheeler market in India are:

➢ Consumers' increasing disposable income

➢ Aspiration to own a motorized vehicle

➢ Availability of easy financing

The other prominent factors can be:

➢ Younger demographic market
➢ Growth in demand from rural area
➢ Capital and financial market doing well in India

The other prominent factors can be:

➢ Younger demographic market

➢ Growth in demand from rural area

➢ Capital and financial market doing well in India

Question 2

Private Sector Companies1.Shell 2. Gulf 3. Valvoline

Public Sector Companies1. Indian Oil Corporation Ltd. 2. Bharat Petroleum Corporation Ltd.
3.
Hindustan Petroleum Corporation Ltd

Answer 2A

Private Sector Companies: -

1.Shell

2. Gulf

3. Valvoline

Public Sector Companies: -

1. Indian Oil Corporation Ltd.

2. Bharat Petroleum Corporation Ltd.

3. Hindustan Petroleum Corporation Ltd

Answer 2B
 Direct Distribution Channels

1.Forecourt-Petrol Pumps and Gasoline Stations

2. FW (Franchised Workshops)-Authorized workshops that serviced vehicles under warranty.

Distribution channel serviced through distributors

1. NFWs (Non franchised workshops)-Small workshops set up by mechanics to service

vehicles

2. Agri stores-Stores that sells seed, fertilizers and pesticides.

3. Institutional-Large sellers such as co-operative stores, associations etc.

Question 3

Answer 3A

Impact of Consumer buying behavior on the MCO market: In India, long term maintenance of
two-wheelers is considered important as owning them is regarded as the first step of
achievement. During the warranty period of the vehicle, most customers do service with the
authorized franchised workshops for the sake of warranty. After warranty period, most change
over to Non franchised workshops for the sake of convenience, personal relationships, service
costs etc. Shift in shop to workshop impacted the new demand for the Non – franchised
workshops. Considering oil change as an important aspect to ensure continuity in their
personal mobility impacted a need for the change of the consumer perception towards buying
the motorcycle oil.

Based on the buying behavior and consumer segments, Castrol was able to identify three
consumer segments in the market – minimalists, appreciators, and enthusiasts. To elaborate:

a) Minimalists-the consumers who seek maximum value for the money spent through the
 reassurance from a credible brand.

b) Appreciators-the consumers who regard their vehicles as their lifeline and are ready to pay
a slight premium, so that vehicles don’t break down.

c) Enthusiasts-the consumers who regard vehicles as their dream and therefore, want the best
for their vehicle, irrespective of the price. It is important for the company to develop and
position the products according to the consumer base. Here, company has to follow the
concept of STP. The process of segmentation and targeting consumer base is done by
classifying the consumer base. Now, company has to follow the apt positioning strategy and
thereby, increase the sales.

Answer 3B

Technological advancements are impacting the two-wheeler industry in the following ways-

➢ Changes in engine design-The newer design has made the oil sumps size smaller and has
increased the time between oil changes for routine maintenance.

➢ Shift from 2 stroke to 4 stroke engines has impacted the consumer buying behavior and
choice of the distribution channels.

➢ 4 stroke engine design with separate lubrication system for the engine cooling impacted the
change in the demand of the motorcycle oil from forecourts to workshops (FW or NFWs). The
engine designs are changing and the sizes are decreasing. This would result in a slump in oil
use. Two stroke engines are replaced by four stroke engines which mean PSUs are no longer
the front-runners are losing the first mover advantage. All companies in the industry got the
same advantage to penetrate deeper. Companies just have to search for better distribution
networks and can also innovate these products as per the changing technological
advancements for getting advantage in the market.

Question 4
Answer 4A

Channel Partner Channel Share (%) 2010

Franchised workshops 30.95%

Spare part outlets 42.85%

Oil shops 11.90%

Non-Franchised workshops 14.28%

Answer 4B

Franchised workshops and NFW’s for overall Four Stroke oil market is significantly greater
in (percentage) than the Castrol four stroke oil. For Castrol, it is higher for Spare Parts
Outlet and Oil Shops.
Four Stroke Oil Market
Franchised workshop 39.47 > 29.77
NFW'S 10.52 > 7.14

Answer 4C

Channel Partner Sales (in litre) per channel outlet,

2005

Franchised workshops 6666.6

 Spare part outlets 578.95

Oil shops 1103.45

Non-Franchised workshops 400

Channel Partner Sales (in litre) per channel outlet, 2005

Franchised workshops 5323.30

Spare part outlets 577.38

Oil shops 884.15

Non-Franchised workshops 670.87

Answer 4D

Answer 4E

Channels for which the sales per channel

outlet (for the four- Franchised 6666.66>5323.3 stroke oil market)
significantly greater workshops 0 than sales per channel
outlet for Castrol.
Oil shops 1103.44>884.15

Spare part outlets 578.94>577.38

 1) Franchised workshop: While this channel would have a large part to play in future growth,
Castrol had restricted access due to limited tie-ups with original equipment manufacturers
and the influence of genuine oils.

2) Oils shops: This channel was slated to have the lowest growth rate, due to a shift in
consumer’s behaviors.

3) Spare part Outlets and non-franchised workshops: These channels were expected to be
the growth drivers of the future. Therefore, it’s significantly higher for FWs, and Oil shops. It
is marginally higher for spare part outlets.

Answer 4F.

Following are the problem areas for Castrol:

➢ Franchised Workshops- They’re underperforming as compared to rest of the market, in

terms of channel share and sales per outlet

➢ Oil Shops- low sales per outlet

➢ Non – Franchised Workshops- Giving oil to NFWs on credit

Question 5

Answer 5A.

The 3 NFW segments are as follows:

1. Stock and sell mechanics.

2. Mechanics who have worked at the franchised workshops and are ready to set up their own
business.

3. Mechanics who are approached for small, minor jobs are likely to be apprenticed under a
stock and sell mechanic.

Module Segment Share in oil Oil buying Financial

Size change behavior Conditions
process
Stock and 0.1 30% the oil Routinely Stock and sell
sell change serviced by mechanics are
mechanic process the stable on finances
distributor as the product
they developed
was sold easily
and was
appreciated in the
market
Mechanics 40% of 50% in the Received Mechanics were
who have the oil change their supply short on finances
worked mechanic process of MCO’s as it was a group
with s from nearby of youngsters
Franchised wanting to start up
workshop a business and the
and are distributors did
ready to set not get any
up their confidence related
own to their existence
Business and money
Mechanics 50% of 20% in the If the Mechanics who
who have the oil change consumers had approached
approache mechanic process needed an for small/minor
d for s base oil change , jobs seem to be
small/mino then they struggling on
r jobs are would buy finances as they
likely to be their own were falling short
apprentice bottles of on branding to
d under a MCOs and generate customer
stock – and take it to the base
sell shop
mechanic
 Answer 5B

Module Parameter 1 Parameter 2 Parameter 3 Parameter 4 Parameter 5

1 Low High Low Low Medium

2 High Low High High High

3 High High Low Low Low

Question 6

Answer 6

 CASA will report to distributors. CASA’s (Castrol Authorized Service Associates) will
direct report to the DSR in the headquarters locations. They are the trained
distributors sales representatives with access to these markets
 CASA will serve to Non-Franchise Workshops. CASA’s (Castrol Authorized Service
Associates) will pick up the product from small distributors and they will serve the
NFW’s small mechanics who set up shop to serve here.