Balfinal Ppt

8/4/2019 Balfinal Ppt

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BAJAJ AUTO LIMITED

A

JOURNEY FROM

HAMARA BAJAJ

TO

DISTINCTLY AHEAD


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BACKGROUND

Founded in 1926 A.D. by Jamnalal Bajaj.

Initially known as Bachraj Trading Corporation Ltd.,

a trading company.

In mid-40s started as an importer of 2-&3-wheelers.

In 1959, secured a License from GoI to manufacture

2- & 3-wheelers.

In 1960 A.D. was renamed as BAL.

In 1960, started manufacturing & exports of

motorscooters, motorcycles & automobiles.


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BAL & Indian 2-wheeler Mkt.

In 1959, secured license from GOI.

Indian industry plagued by License Raj.

BAL launched CHETAK its flagship scooter

model in 1972.


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Hamara Bajaj

Positioned CHETAK brand with this ad campaign.

Core Values : Reliable & Trustworthy.

Campaign based on V-F-M products.

Ad campaign helped Bajaj position CHETAK:

a geared model-scooter occupying near iconic

status.


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Turning Point Why?

BAL drastic declining of sales in 1990.

Main reasons cited:

Shift in Consumers Preference,

Recession,Neglecting Customers


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Loosing Market Share


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Bleeding ofHamara Bajaj

8/28/2011

7


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Paradigm Shift

In 2000 BAL lost its No.1 position to HHL.

Geared Scooter Sales drop by 41% in 2001.

Growing popularity of Motorcycles. Change in consumer preference,

from scooters to 4-stroke engine motorcycle.

Reoriented business: launched series of new

motorcycle in market.


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DECLINE IN BAJAJ MARKET

In the late 1990s, the Indian two-wheeler market witnessed a shift inconsumer preferences.

The popularity of geared scooters began to wane while that of motorcycles

soared.

There were various reasons for the shift:

1. India was undergoing a demographic change, with the proportion ofyounger people in the population growing significantly.

2. The economy was growing, which increased the disposable incomes of the

middle class.3. Many newer models of motorcycles, with improved designs and modern

technology had become available in the market.


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While these changes were taking place in the market, the features of

scooters, especially those of the Bajaj Chetak, remained essentially

unchanged.

The brand thrived during the license raj with virtually no competition.

It was during 1990-91 that the brand began the journey to the end.

Promoted along the base line " Hamara Bajaj", this was the Indian

Family vehicle - a position now owned by Maruti800.

In January 2006, BAL announced that it had stopped production of

the Chetak.


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The " Tilting the Chetak to the side for starting " was a common joke.

Scooters were BAL's main products, and when market preferences

shifted to motorcycles, the company was faced with declining sales

and revenues.


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REASONS FOR DECLINE

The primary reason is that the Brand forgot the customers.

Another case of Marketing Myopia. The company failed to

understand the changing perception of the customers towards

scooters.

Rather than looking at the customers, the company focused on

influencing Government to block the opening up of economy.

Bajaj never did anything with the product. For 40 years Chetak had

the same look, same quality and style.

Bajaj never was serious about product development. The R&D spent

for a long time was a miniscule 1%.


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The average cycle time for the new product development was 4-5

years compared to 2-3 years of Japanese competitors.

There was nothing wrong with the Promotion. " HamaraBajaj " and "

No one can beat a Bajaj " were famous baselines.

There was nothing wrong with distribution and the pricing was very

reasonable. The major problem was in the first P :Product.

Bajaj never seriously looked at customer perception about Chetak.

The product had serious problems like starting trouble and riding

comfort.


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It was believed that the dramatic shift happened because

players like BAL did not pay sufficient attention to design,

R&D, and customer satisfaction.

The decline was directly related to neglect of this

segment over mileage, contemporary technology, and

non-stop excitement of launch of newer and newer

models offered on the motorcycles platform.

The biggest drawback of Bajaj Chetak was its handling

during heavy breaking.


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BAJAJ MARKETING MIX

PRICE

Bajaj Chetek's price was affordable. But the new motorcycles entering the

two wheeler segment offered better technology & fuel efficiency than Bajaj

Chetak

it almost same price.

PRODUCT

1. The company should look upon its R&D and improve the overall looks of

Bajaj Chetak.

2. It should make efforts to change the quality & style of the scooter to suit

the tastes & preferences of its customers.

3. The product had serious problems like starting trouble &riding comfort, which

need to be eliminated.

PROMOTION

Bajaj Chetak should come out with various schemes &incentives.


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Evolution of Two-Wheeler Industry

Initial Years Manufacturing

was licensed.

High Customduty on import

Steep exciseduty & Salestaxes

Sellers Market

Early to Mid

90s Long waiting

period

Delicensing in1993

Decrease incustom & exciseduty

Auto FinanceBoom

Mid 90s to

Early 2000 Buyers Market

Easy Finance

Increase inCompetition


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Demographic Factors

Population Age Mix

Rural Urban Ratio

Literacy Level

Changing Income Level

Changing Family Structure


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Economic Factors

Change in government policy

Reduction in excise & custom duty

Rising fuel price


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Change in Communication Strategy


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Inspiring Confidence .

Launched a series of motorcycle in an attempt to

capture market share.

In 2001, BAL showed slice of life situations of new

age India.

Analyst felt that by 2004, BALs image had

undergone considerable change. But..


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In spite of changing its focus & strategy fromscooters to motorcycles BAL - MD felt that:

"Like Volkswagen Beetle, the product (Bajaj Chetak) had lost itsrelevance." Rajiv Bajaj, MD, Bajaj AutoLtd., in January 2006.

"We believe it is not good enough to be better, it is important to be distinct.

Rajiv Bajaj, Managing Director,

BAL.

This Lead to the strategy of


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Distinctly Ahead

BAL announced new corporate strategy in mid 2007.

USP Styling & Technology. Repositioned itself aggressive & fast-paced.

Distinctly Ahead focused on 3-core values:

Innovation, Speed & Perfection.


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The ad featured pay-off line,

Alag Andaaz, Alag hai Khoj, Rakhe Aage, Hamari

Soch.

Launched Bajaj Pulsar flagship brand- based on this

strategy.

bajaj commercial-1.mp4


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Future


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Recommendations

Company should keep focusing on the fast growingmotorcycle segment.

Strengthen its position in ungeared segment.

Concentrate on JVs for techno needs.

Look to expand their base outside further. It already had astrong presence in Africa and South Asian Countries.

Concentrate on Blue Ocean of Second hand Bike Market .

Aggressive Launch its new Low Cost Car.

Focus on Easy Credit Lending - In the present economicalcrisis, Bajaj can utilize its subsidiary, Bajaj insurance in

coming up with schemes that will help consumers buy twowheelers on friendly terms.


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THANK YOUBajaj Pulsar Mania TV Commercial.wmv

PREPARED BY:

Siddharth Jawale

Puntia Panchal

Sharmin AlamAashna Makkar

Durwa Parab

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Balfinal Ppt