Group Members.

 Asha Narayankar 57
 Pravin Ramakrishnan 65
 Soniya Rahate 68
 Swapnil Shah 82
 Karthik Shastri 85
 Jasmin Shaikh 86
 Pooja Soni 93
 Case study Nov -2004

 Tractor is the major farm equipment marketed

under agriculture and agriculture durable
category to rural India.
 Apart from is utility in farming activities, tractor
is considered as states symbol in rural area and
is also used as means of conveyance and
transportation
 The tractor industry in India is segmented by
horsepower (HP) into the lower segment of
25HP and higher segment of 45HP and above.
 The market has gradually shifted to medium and
higher segments of HP category.
 Previously, the sale of tractor was concentrated
in area like Punjab, Haryana and Western Utter
Pradesh, which enjoyed the benefits of green
revolution and required low power tractors for
tilling as the soil in these states is alluvial in
nature.
 The recent studies show this region-wise
tractor sales have shifted from northern
states to other part of the counter.
 With an increase in irrigated cropped area,
the population of tractors started
increasing in other states like the ounces
situated in west and south India.
 Tractor sale have also gained considerable
momentum in states like Madhya Pradesh,
Maharashtra, Gujarat and Rajasthan
during the past few years.
 The studies also suggest fresh demand
will be driven by states in the west and
south and high powered segment of the
country while Punjab, Haryana western
Uttar Pradesh, will witness more
replacement demand.
 The demand will concentrate on the
medium and high HP segment.
 Mahindra and Mahindra (M&M) is the
leader in tractor marketing in rural India
with more then 38per cent market share.
 M&M has a widespread and excellent
dealers and servicing network in northern
part of country.
 Other players are Punjab tractors, escorts,
TAFE and Eicher and the competition is
likely to intensify further due to increasing
presence of global players.
 Some of the recent trends in rural
marketing are as under:
 Tractor now a day is not only considered as farm
equipment in rural India, but also perceived as
family car/vehicle and transportation means in
rural India.
 Opinion leaders and users play an important role
in agriculture and agriculture durable products.
 Financing/ credit facilities, local presence and
after sale service are crucial factors for success
of agricultural durable items because of huge
investment by farmers.
 All the decisions related to agriculture and
agriculture durables are a prerogative of
the head of the family or the elders of the
village. However, rural youth are major
decision influencers.
 In agricultural durable items, rural
consumers are very alert to the value of a
product and are willing to research
extensively by comparing the product
features, quality and price with option
available to them.
 Apart from the use of melas, mandis, haats
and vans to decimate product in formation
and increase awareness , agri-mills (such as
sugar mills), rural tournaments, service
camp, factories, electricity boards and local
brand ambassadors are good vehicle to
promote the agricultural durables as farmer
has ample time to spare and listen to
product details and watch live
demonstrations.
 Considering the above points, intensifying
competition, demand in other parts of the
country and future expected demand, M&M
want to re-devise its marketing strategies to
retain its market leadership throughout the
country.
As a marketing consultant, please give
your innovative suggestions for:
 What strategy should the company adopt in
terms of product mix innovation/modification,
pricing, distribution, after sales service and
promotion to retain its leadership?
 Should the company rely on local youth and
dealers for sales and after sales services? What
are the advantages of the same?
 Discuss the effects of liberalization and WTO
on agriculture input market in India?
 Facts
 1982: Mahindra brand of tractors launched.
 1983: Mahindra & Mahindra became market
leader in the Indian tractor market, a
position it has retained till date.
 2003 :
Mahindra & Mahindra Tractors awarded
the prestigious Deming Prize for excellence in
quality, making it the first tractor company in
the world to receive the award.
India's first Turbo tractor launched -
Mahindra Sarpanch 595 DI Super Turbo
 Mahindra Group's Farm Equipment Sector is the
largest producer of agricultural tractors in India.
It has enjoyed an unparalleled market leadership
in the domestic market for the last 23 years.
 With a 30% market share, the Bhoomiputra,
Sarpanch and Arjun brands of tractors give the
Group's Farm Equipment Sector a presence in all
the major tractor segments in India.
 It has a large customer base of 11,00,000
satisfied customers and the deepest distribution
reach.
 Summary

 Tractor is an agricultural durable also

considered as status symbols in rural
India. Tractor is segmented by
horsepower (HP) there are basically three
level segments.
 Lower level i.e. of 25HP.
 Mid-level segment i.e. of 35HP.
 Higher level segment i.e. of 45HP.
 Before the sale of tractors were more in area like
Punjab, Haryana due to green revolution but
now it has been shifted from north to west and
south part of India like Rajasthan , Maharashtra
etc. the studies shows that now-a-days demand
for mid segment and higher segment HP have
increased more.
 Mahindra and Mahindra (M&M) was leader in
tractor marketing and occupied 35% of market
and considers has market leader and have
excellent serving network in northern part of
country. their is cut threat competition between
M&M and Punjab tractors , Escorts, TAFE which
is likely intensify further due to the present of
global market.
 Some of the recent trends in
rural markets are as under.
 In rural India tractor is used as farm
equipment as well as family car/ vehicle and
transportation mean.
 Opinion leader and users play important role in
agriculture and durable produce where all the
decision are taken by head of the family.
 Financing / credit facilities, local presence and
after sale service are crucial factors for success
of agricultural durable items because of huge
investment by farmers.
 In agricultural durable items, rural consumers
are very alert to the value of a product and are
willing to reaches extensively by comparing the
product features, qualities and price with
optimum available to them.
 Apart from the use of meals, mandis, haats
and vans to decimate product information and
increase awareness, agri-mills, rural
tournament, services camps, factories,
electricity boards and local brands.
What strategy should the company
adopt in terms of product mix
innovation/modification, pricing,
distribution, after sales service and
promotion to retain its leadership?
In terms of product mix innovation / modification the
company should adopt the following strategies.
 The tractors should be designed in direct response
to the customers' needs. The company should
consider to increase horse powers and
corresponding axle and transmission changes which
will enable the customers to increase their
productivity and success.“
 The tractors should be tough, economical and
reliable.
 They should be loaded with a high performance
engine, easy shift transmission, advantageous single
speed PTO and big lift capacity.
 Ergonomically designed seats.
 Comfortable rides for long hours.
 Apart from farming activities they should
perform operations like material handling and
transport efficiently.
 Ensure long-term structural stability.
 Better fuel efficiency
 The products should be a complete package of a
large capacity engine, heavy-duty transmission,
high lift capacity hydraulics and a very robust
cast iron chassis.
 These machines must perfectly suit almost all
kinds of farming operations ranging from basic
chores to commercial landscaping.
 Lower engine noise.
 Pricing Strategies
 Deeper penetration of market- rural markets adopted for
deeper penetration and expansion because of its size.
 Long run profit maximization- a company that enter the rural
market should not anticipate profit in the short run but wait
for success in the long run.
 Recover profit through distribution cost- a company thinking
of going rural should prepare its pricing objectives in such a
way that it can recover the cost involved in distribution,
production and dealer margin too.
 Competitive pricing- rural marketers study the pricing
strategy of competitors and accordingly fixed the price of the
product.
 Increase sales volume and market share- one of the main
objective will be to increase the sales volume. Pricing will
play an important role in order to increase the sale volume.
 Network & Distribution.
 M&M should gear up its network to satisfy and delight
the customer by providing Timely and Quality service
near to the customer.
 To address the problem of ‘DISTANCE’ traveled by
customer to avail services, the service network should be
expanded by appointing Neighborhood Service points
(NSP) and Mahindra Authorized Service Points (MASP)
apart from Dealerships and their branches
 Currently, the customer can get service & Spare parts
from any of the 650+ dealerships, their 413 branches,
68 MASPs and 480 NSPs. The customer saves his
valuable time and money.
After sales services of M&M.
 At M&M, Customer care efforts should be put in
to make Customer’s Mahindra tractor ownership
– a memorable experience.
 Programs and practices must be incorporated to
enhance this experience which must be
practiced by both Dealers and M&M employees.
 Key parameters which are of prime importance
to Customers like “Good quality service in
minimum time” must be taken care of by
increasing Network and Doorstep service.
 This network should also take care of Genuine
Mahindra Parts availability.
 Dealers should be geared up with equipped
workshops and skilled manpower to handle the
product.
 Various innovative programs like Swasth Tractor
Swasth Chalak, Padyatra, Installation – must be
encouraged & promoted to build emotional
bond and further improve Company – Customer
relationship.
 The idea is to give the best experience every
time Customer visits the dealership or interacts
with the company.
 Regular feedback must be taken from the
customers on product and services offered and
changes in systems should be incorporated to
take up Customer experience to the next levels.
 Promotion.
 In The Year 1999, M&M went into rural Haryana
with Bits New 25 HP BLUE TRACTOR MODEL-
Mahindra 255-di (all its other tractors are red). It
has used the positioning statement “ Bade ka
Faida Chhote Main” designed to win the small
farmer over on the basis of superior performance,
it avoid print and electronic media advertising and
went on for on fields activities .

Philosophy: instead of waiting for the customer to

approach them, they have taken the brand to the
farmers door step, it was an innovation in
delivering customer values to rural India .(Gupta
1999)
 Mahindra Kisan Mitra - a Mahindra Initiative
  Mahindra and Mahindra Ltd., Farm Equipment Sector of
the Mahindra Group brings to you
MahindraKisanMitra.com, a place for the Indian farmers to
access wealth of information which is updated on a daily
basis. Farmers can check daily mandi prices, read weather
updates, latest crop advisories, and agri related news.
Farmers can also read and benefit from the success
stories of other fellow farmers.  The site also provides
information under various other sections such as crop
information, loans, insurance, mandi database, cold
storages/warehouses and agri events.
Q 2.Should the company rely on local youth
and dealers for sales and after sales
services?
What are the advantages of the same?
 Advantages to Rely on local youth and dealers for
sales and after sales service. 
 Local youth are major influencers as they are the
actual user of the product .
 Secondly the rural consumers may trust the local
youth and dealers regarding a certain product as they
are one of them and the comfort level is better as
compared to appointing a person from outside. The 
local dealers  are  within the rural areas thus the
company has better reach to the rural consumers.
 By employing rural youth and dealers they will
work hard as there will be increase in their
standard of living and their families thus the
company will also get a good public image within
the rural areas and rural consumers will have
trust in the product and the organization. There
are many examples where the rural youth and
dealers have proved to be efficient and skillful.
 Rural people were unaware of renewable
technologies and would not spend their
hard earned money on a technology,
which did not have efficient after sales
services at the local level and no
opportunity to earn an income.
Q3. Discuss the effects of liberalization and
WTO on agriculture input market in India?
 Effects of liberalization
 Indirect
1] Positive  
 
 Making agricultural market access conditions more
transparent, predictable and competitive;
 Establishing or strengthening the link between national
and international agricultural markets, and thus relying on
the market for allocating scarce resources to most
productive uses.

2] Negative
 Increase in imports of crops and oil seeds
 Domestic market for certain commodities does not grow
Direct effects.
   Direct effects on agricultural input are  the input
subsidies are cut down due to which the Indian
agricultural sector  has difficulties in growing as the cost
increases and the returns are less and prices have to be
kept competitive as per global standards thus it is
difficult to fulfill the domestic demand with domestic
supply thus importing of agricultural products increases.

 The better side of this is that the agricultural input

industry has chances of growing as it can recover its
cost and earn profits. Thus these industries can go
ahead export their products and match themselves with
international standard.
Conclusion : Liberalization of trade in agriculture will
create challenges and opportunities.
Good governance and adoption of appropriate policies,
including regional cooperation, will minimize costs and
maximize benefits 
Q 8: how do leading companies like
Hindustan Lever Limited (HLL) &Colgate Palmolive
market their products in Rural India?
 Marketing strategies of HLL
 In 1998, ‘Project streamline ’
played an important role to
enhance Hll’s control on supply
chain – a very important
component desired by all
marketers. This project enabled
itself to reach even unapproached
villages.
 It started as a pilot project in
Uttar Pradesh & now being used
to cover many new villages.
 Each of the 450 districts in India has as many as
hundreds villages connected to them , at times
even thousands.
 HLL appoints redistribution stockists who approach
district stockists often turned as wholesalers, some
people in remote villages are appointed as ‘Star
Sellers’.
 They take the stocks on credit from the
redistributors & sell them in the remote villages. As
soon as the stock gets exhausted they approach
the redistributors in the district again. In this way
HLL is able to penetrate deeper & deeper into the
rural market.
 Project SHAKTI : Under this project a
woman from the SHG is selected as a
shakti entrepreneur & she receives stocks
of hll products like ponds,lifebuoy, clinic
plus, lux, 3 roses tea etc.
 She sells these products directly to the
consumers & small merchants in &
around her village. In this way she
serves 6 to 10 villages whose
population range is 1000 – 2000
people. The company gives proper
training & for the first 3 months the
company holds the stocks & delivers as
requirement. She begins her door – to-
door selling. Normally she earns a
profit of Rs 800 – 2000 a month if she
has a turnover of
Rs 10,000 -25,000 per month.
 Marketing strategies of
Colgate- Palmolive.
 Colgate stepped up its rural promotion drives along with IDA
(Indian dental association), where promotional vans do the
rounds of the villages & educate the rural folks on oral hygiene &
its products like tooth pastes, tooth brushes, tooth powders etc.
 They have also launched programmes like “Young India Bright
Smiles – Bright Futures” school dental programmes. And various
such programmes in villages where they provide free dental
check ups.
 The roving Colgate vans after screening 22-minute film on oral
hygiene that explains how to use the products, offer sampling at
stalls set up near the vans.
In Dec 2000, the center for industrial & Economic Research
conducted a survey called “Emerging market trends”
& following was the findings in the field of creating brand
awareness & penetration in the rural marketing.
HLL had the highest penetration in the above product
categories.

Company Household penetration (%)

HLL 88
Nirma chemical works 56
Colgate -Palmolive 33
Q8.While ‘think local’ is the mantra for driving sales in
India, ‘Act local’ could just be the new formula for
connecting with the hinterland in terms of distribution,
sales force / after sale management and promotion
strategies. Elaborate with examples?
 BY COMMUNICATING AND CHANGING QUALITY
PERCEPTION
 BY PROPER COMMUNICATION IN INDIAN LANGUAGE
 BY TARGET CHANGING PERCEPTION
 BY UNDERSTANDING CULTURAL AND SOCIAL VALUES
 BY PROVIDING WHAT CUSTOMER WANT
 BY PROMOTING PRODUCTS WITH INDIAN MODELS
AND ACTORS
 BY ASSOCIATING THEMSELVES WITH INDIA
 BY PROMOTING INDIAN SPORTS TEAM
 BY TALKING ABOUT A NORMAL INDIAN
 BY DEVELOPING RURAL-SPECIFIC PRODUCTS
 BY GIVING INDIAN WORDS FOR BRANDS
 BY ACQUIRING INDIAN BRANDS
 BY EFFECTIVE MEDIA COMMUNICATION
 BY ADOPTING LOCALISED WAY OF
DISTRIBUTING
 BY ASSOCIATING THEMSELVES WITH INDIAN
CELEBRITIES
 MELAS
 PAINTINGS