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MARKETING PLAN FOR
HONDA BRIO SEDAN
Presented By:
Sneha Raina – 9Pritesh Salian – 30
Mayank Mehta – 49Ananya Kumar – 71Ashwin Verma – 106
Indian Automobile Industry Largest 3 wheeler market
in the world 2nd largest 2 wheeler
market in the world 7th largest Passenger car
market in Asia & 10th Largest in the world
5th largest commercial vehicle market in the world
Population of automobiles in India more than 110 million and growing at the rate of 12% p.a.
Passenger Vehicles Market
Passenger car sales increased by 4.24 %
Passenger cars are expected to grow at 10-12%
The passenger vehicle market of India will cross Japan by 2017-18
India’s passenger vehicle production projections:2010-2.6 million2015-5.1 million2020-9.7 million
Factors Contributing To Growth Of PV’s
Passenger Car Penetration In India
Sedan Market in India
•Second largest by volume
•Car sales grew by only 2.8% in May, citing high fuel prices and interest rates on retail loans
•Sedan segment has grown by 37% in May this year
•Entry level and mid-size sedan cars priced between R6 lakh and 10 lakh are one of the fastest growing categories in cars
• Diesel variants continue to grow at healthy double digit levels
Target Market Demographics Honda has 6 models in its portfolio Brio, Jazz, City, Civic,
Accord, CR-V Honda has segmented its market in a way that its Accord
& CR-V is for Elite class, Honda Civic for Upper Middle class, Honda City, Brio and Jazz for only Middle class
Demographic: 30 -50 years old M/F; Social Class AB; Single and Married
Inclined towards younger buyers Lifestyle: Working class, Established in work and has
buying power, fairly successful, wants value for money and prestige in what they drive
Behavior Factors: Replaces car every 5-7 years, Efficient fuel consumption
SWOT ANALYSIS
Strengths: Strong Brand Equity Loyalty rate of 62% Annual advertising Budget: $700-800
Million. Honda Brio (Hatchback): One of the best
selling cars in India Premium products
SWOT ANALYSIS
Weaknesses: High cost structure Relies heavily on Civic and Accord
(Sedans) which contributes 55% to the total sales
Depends on North America for 85% of its profits
Honda Brio sedan only the first Honda car to have a diesel engine
SWOT ANALYSIS
Opportunities: Cater to the middle class segment of
customers Extend the existing variants to Diesel
engines Launch a Hybrid version Enter emerging markets
SWOT ANALYSIS
Threats: Strong competition from the existing
players like Maruti Suzuki, Hyundai etc. Rising fuel prices Growing popularity of Hybrid/Fuel
efficient cars. Government policies for the Automobile
sector
Product Details
Type: Sedan
Expected Launch in India: Fourth Quarter, 2012
Fuel type: Diesel
Seating Capacity: 5
Product Details
Distribution: Distribution through a network of 137
authorised dealership facilities in 85 cities.Target Audience: Middle and upper middle class. Competitive
pricing.Services: Honda dealership centres are based on the
"3S Facility" format, offering complete range of Sales, Service and Spares services to its customers.
Marketing Strategy
Mission: Support the current sales To enter the entry level sedan
(C1)segment sedan market To enter the diesel segment Increase the market share Target the untapped market
Marketing Objectives
Increase the market share in Sedan segment.
Increase the total number of units sold.
Total Units sold are less due to absence of mid-segment sedans.
Source: motorbeam.com
Marketing Objectives
Increasing customer base by entering Diesel segment.
Increase the overall market share from 4.86% to 10%.
Competition Analysis
Direct Competitors
Verito
EtiosDzire
Indigo Manza
Attributes and Pricing
Maruti Suzuki Dzire Toyota Etios Tata Manza
Engine Petrol Diesel Petrol Diesel Petrol Diesel
1.3 litre 85.8bhp AlTec32 engine
1.3 litre 73.9bhp DDiS engine w/ Common Rail multi injection technology
1.5-litre 88.7bhp 16Valve Petrol Engine
1.4-litre 68bhp 8V SOHC Diesel Engine
1.4-litre 4 cylinder 88.8bhp, MPFI, Petrol With Intelligent Port Resizing
1.3-litre 88.8bhp 16V Common Rail Diesel Engine
Price Rs 5,13,270* Rs 6,25,429* Rs.5,41,185* Rs 6,73,507* Rs 5,89,898* Rs 6,65,650*
*Ex – Showroom Mumbai
Approach Observed - Value Based Pricing
Indirect Competitors
Price - Rs 5,81,882* - Rs 7,36,439*
Price - Rs 5,06,000* - Rs 6,43,639*
*Ex – Showroom Mumbai
Current Target Markets
Mid Size Hatchback (B2 Segment) Brio
Premium Hatchback (B2 Segment) Jazz
Mid Size Sedan (C2 Segment) City
Luxury Sedan (D2 Segment) Accord
Compact Luxury SUV (D2 Segment) CRV
Positioning
EarlierPositioning Based on Pricing
PresentPositioning Based on Competitors
Marketing Mix
ProductBrio Sedan
Based On
Petrol
Displacement 1198cc, i-VTEC
Maximum Power 88 Bhp @ 6000 rpm
Maximum Torque 109 Nm @ 4600 rpm
Diesel
Displacement 1198cc, i-DTEC
Maximum Power 70 Bhp @ 4500 rpm
Maximum Torque 170 Nm @ 2000 rpm
The Brio Platform
Price
Petrol Honda Brio sedan E MT – Rs. 5, 15, 000 Honda Brio sedan S MT – Rs. 5, 67, 000 Honda Brio S Option MT – Rs. 6, 60, 000
Diesel Honda Brio sedan E MT Diesel – Rs. 6, 15, 000 Honda Brio sedan S MT Diesel – Rs. 6, 79, 000 Honda Brio S Option MT Diesel – Rs. 7, 60, 000
Promotion
1) Television:- 20 repetitions per day for the first 3
months across 5 channels. Around 10 repetitions for the next three
months across 5 channels.2) Radio:- 10 repetitions for 3 months across 4
channels.3) Hoardings:- 200 hoardings for 3 months across 20
cities.
Place
Current Dealership Network
Strategy
Pull – Push Strategy
SALES FORECAST
Sedan Segment grew by 37% in May, 2012
Entry level Sedan grew by 40% Share of Diesel cars in the entry level
Sedan segment grew from 60% to 85% C1 Sedan segment is expected to grow
by 28% Sales forecast accounting for 8-10% of
the C1 segment
BREAK EVEN ANALYSIS
0 10000 20000 30000 400000
50000
100000
150000
200000
250000
Break Even Chart
RevenueTotal Cost
No. of Units
Sale
s V
alu
e
3721.73 Mil-lion
5838
Excel Working
BREAK EVEN CALCULATION Contribution Margin Ratio = Selling
Price Per Unit – Variable Cost Per Unit/Selling Price Per Unit*100=637500-385000/637500*100=39.61%
Break Even Sales = Fixed Cost / Contribution Margin Ratio=14742/39.61%=Rs 3721.73 Millions or 5838 units
Remuneration
The remuneration offered in Honda Cars India may differ on the basis of various attributes such as candidates’ qualification, experience, job profile, and so on. Generally speaking, the pay scale offered by the Automobile Sector is comparatively better when compared to the other sectors. The B.Tech / B.E in Automobile Engineering graduates can earn a good salary in the starting stage itself. The average monthly income for them would be around Rs. 20,000/- and the salary will rise after the training
period.
Honda Hiring
As a strategy for hiring, more than 80 percent of Honda hiring is of fresher or people with less than five years of experience.
Honda Pay Scale Executive- Approx 4,10,000 to 4,44,000 includes Bonus Warehouse Executive- 3,70,000 to 4,20,000 plus around
70,000 as Bonus Senior Executive-3,70,000 to 4,20,000 plus around 24,000
as Bonus Exclusive Dealer Trainer-4,06,000 to 5,00,000 plus around
16,000 as Bonus Most Popular States for Dealership are kerala and
Maharashtra for Honda Cars
QCC
Quality Circles are (informal) groups of employees who voluntarily meet together on a regular basis to identify, define, analyze and solve work related problems.
Usually the members of a particular team (quality circle) should be from the same work area or who do similar work so that the problems they select will be familiar to all of them. In addition, interdepartmental or cross functional quality circles may also be formed.
An ideal size of quality circle is seven to eight members. But the number of members in a quality circle can vary.
Objectives of Quality Circles Promote job involvement
Create problem solving capability
Improve communication
Promote leadership qualities
Promote personal development
Improve morale through closer identity of employee objectives with organization's objectives
Kaizen Method
Helpful For Global Company
Localisation
Suggestions for Improvement
GET PROGRAM
Structured job rotation program for multi-skilling
Training at our overseas facilities for technical skills transfer
Assignments with expats for know-how learning
Assigning expats as Project members or leaders for important company wide projects
Sending people to work in overseas factories for two to three years to develop managerial skills, cross cultural experiences and developing leadership skills besides regular skill enhancement
Honda’s Philosophy
Respect for individual
Creation of three joys
Equality, initiative and trust
e.g.-Honda has common canteens, locker rooms, and uniforms, which at an external level give a feeling of oneness
On-the-Chance training
Higher levels of engagement
Process of giving calculated and pre-planned chances in the way of projects and assignments away from normal work.
Helps in honing skills and uncovering potentials that were previously unknown
Employees are encouraged to reach out to the management with various solutions about what they feel will work rather than asking them what needs to be done
Honda’s Guiding Principals Transparency in our decision making processes and consensus in reaching
decisions that impact our associates Pursuing ‘equality’ in our dealings, systems and processes that reduce the
perceived "divide" between the management and line associates Constant communication with union and also associates on the shop floor
through daily morning meetings , joint welfare committee meetings [ e.g. canteen, transport, insurance etc.], regular union-management interface, joint participation in CSR activities and community service etc.
Speed in resolving grievances and personal related issues One-on-one interactions of selected Vice President level staff with the
unions for sharing business outlook, challenges, priorities, cost data etc. and also hearing the concerns and priorities of the shop floor associates
Giving a clear career path to our line associates to graduate on to supervisory and managerial positions within the company. Today, Honda have more than 70 people who have graduated on to positions of Team Leaders and above. While it may seem like a very simple concept, but before such transitions, Honda also take them through a well-structured program that includes exposure to relevant skills, training in personality grooming, English, Computer skills, data analysis etc
Executive Selection Scheme
Honda motors has always strived towards excellence both in its efforts towards total integration as well as in recognising its talented employees. The Company is constantly creating prestigious programmes to reward and retain its outstanding employees.
IESS is a fast track programme for accelerated growth of high potential .
The selection involves a 3 stage process:* Written Test* Power Interview* Assessment Centre
Short-listed candidates are required to go through an interview with the executive directors.
They are promoted to Manager's level thereby saving almost 10 to 13 years of work time.
Honda- Contingency
Honda is ready to face the cyclic changes that are here to stay.
Today it may be petrol price hike or the adverse exchange
rate impact. It is very important that corporations build internal constitutions
that are more resilient to wide fluctuations in their business fortunes, are agile, and more predictive than being reactive and have lean operations
Regular communication with stakeholders, including employees is the key to managing anxieties during lean phases of business cycle, undue expectations during good times and fear and rumors during bad times.
Being honest and upright with clear sharing of information at all times by the management goes a long way in soothing such anxieties.
THANK YOU