MARUTI SUZUKI PRODUCT ANALYSIS REPORT

MARKETING ASSIGNMENT ON MARUTI SUZUKI 1

Submitted To:

Prof. A.V. Shukla

MARKETING

ASSIGNMENT ON

MARUTI SUZUKI

Submitted By:

14IB308 : Akshay Kr. Ghosh

14IB367: Vikash Kumar

14IB340: Mohit Gehani

14IB335: Lavi Varshney

14IB302: Aadyant Vashishth

14IB322: Dipti Soni


TABLE OF CONTENT:

1. Introduction

2. A brief History

3. 4 P‟s of Marketing

A. Product

B. Price

C. Place

D. Promotion

4. MSIL Strategy to differentiate itself from its competitors

5. 5 C‟s of Marketing

a. Customer

b. Company

c. Competitor

d. Context

e. Collaboration

6. Executive Summary

7. References


INTRODUCTION:

Maruti Suzuki India Limited is a partial subsidiary of Suzuki Motor Corporation of Japan. It has

been the leader of the Indian car market in the passenger car segment for over two decades

accounting for over 50% of the market share. (Source: TOI)

The company offers a wide range of cars across different segments. It offers 14 brands and over

150 variants - Maruti 800, people movers, Omni and Eeco, international brands Alto, Alto-K10,

A-star, WagonR, Swift, Ritz and Estilo, off-roader Gypsy, SUV Grand Vitara, sedans SX4, Swift

DZire and Kizashi. MSIL had also introduced vehicles with CNG fitted engines under

environmental friendly approach. These include Eeco, Alto, Estilo, Wagon R and Sx4.

It was the first company in India to produce car and sell more than a million cars. It is largely

credited for having brought in an automobile revolution to India. It is the market leader in India

and on 17 September 2007, Maruti Udyog Limited was renamed Maruti Suzuki India Limited.

The company's headquarters is located in New Delhi.

A BRIEF HISTORY:

In February 1981 Maruti Udyog Limited (MUL) was incorporated under the provisions of the

Indian Companies Act, 1956.

A license and Joint Venture Agreement was signed between Government of India and Suzuki

Motor Company (now Suzuki Motor Corporation of Japan) in October 1982. It manufactured

India's first affordable cars though the actual production commenced in 1983. On 14th

December, 1983, first Maruti 800which was produced in gurgaon plant.. Late Mrs. Indira

Gandhi, the then Prime Minister of India, handed over keys for this car to the first Maruti

customer. By 1992 SMC had acquired a majority stake in MUL (increases to 54.2%). In 1990's

when the economy was liberalized and foreign investment allowed into India, the auto

component companies, set up and nurtured by Maruti Suzuki, became the foundation for global

car companies as well. These new players in the Indian automobile segment found an

accomplished and experienced auto component industry, which encouraged further foreign direct

http://en.wikipedia.org/wiki/Suzuki

http://en.wikipedia.org/wiki/Japan

http://en.wikipedia.org/wiki/New_Delhi


investment into India. With the entry of foreign players into the automobile sector MUL was

forced to become more competitive and aggressive in its marketing strategy in order to maintain

its market share. By 2003 it got listed on the BSE and NSE. In 2007 the Board of Directors of the

company gave approval to change the name MUL to Maruti Suzuki India Limited. In 2008 M-

800 crossed the 25 lakh mark and MSIL celebrated its Silver Jubilee. By 2009 MSIL‟s Capacity

to manufacture expanded from 800,000 to a million units (Gurgaon plus Manesar plants)

annually.

4 P’S OF MARKETING:

The 4 Ps of Marketing helps in determining the various marketing strategies adopted by the

company. The 4 P‟s are :

1. Product

2. Price

3. Place

4. Promotion


1. PRODUCT:

Maruti Suzuki has divided its Product line into five segments as per the following table.

Maruti Suzuki under different production line tries to target different segment of the market

producing different varieties of cars. Under product line A1, A2, A3, Maruti Suzuki‟s main

focus is on producing quality car having high mileage. These Cars have also been divided

into its various variants depending on the type of fuel used. Some cars have been rolled out

for use with both Petrol and Diesel. With rising prices of petrol, there is a sharp demand for

Diesel-run vehicles. So it also focus on making LPC cars for which MSIL has introduced

two of its cars with LPG fitting too. The MSIL while making the product also keeps in mind

the Designing of the car

Design:

Maruti Suzuki according to different segment of the focuses on the designing of the car

too.

• Maruti-800A1

(mini)

• Alto, Zen ,Wagon –R, Swift, A-star ,Ritz

A2(compact)

• Esteem , Baleno, Dzire A3(mid size)

• Vitara, Gypsy , KizashiUtility Vehicles

• Omni, VersaMulti purpose Vehicles


Along with just selling car it also provides various services and features to the

customer in order to differentiate its product from its competitors which includes

following:

A. Services:

MSIL tries to focus on providing better services to their customer for which they provide

services through various service centre across the country ; so that , In case of, any wear

and tear consequent replacements and repairs could happen. Maruti Genuine Parts ensure

that customers‟ car remains like the original, down to the smallest part for which it makes

sure that over Maruti Suzuki, 20,000 parts which come together and work in perfect

harmony is made available to their customers under MSIL genuine parts. The customer

can get their problem sorted out relating to the functioning of the car easily for that it also

makes all the parts available throughout every corner of the country. A new Vehicle

Tracking System improved efficiency on the shop floor and enhanced quality control to

serve their customers more effectively. It also provides online support to their customers

Stuck in the city. Where one is stuck in the back of beyond, without help for miles. All

they need to do is remember a number. 1800 102 1800. Call and Maruti On Road Service

will swing into action.

• For the higher income group of people it makes luxurious cars with good looking design and more features.

• ex:Kizashi,Grand vitara,

A

• For middle income group of people it makes car that is good looking but with minimum basic features so that the cost of the car is reduced and would give maximum mileage.ex: Swift Dezire

B

• For Family cars it focus on designing big car with big space and comfortable for travelling of a Indian family..

• ex: Omni

C


B. Warranty:

For making its product competitive in the market and their customers satisfied It

provides Warranty for a period of 24 months or 40,000 kms whichever comes first from

the date the first owner takes delivery

The support it provides under warranty is in the form of replacement of parts or repairs

which is done for qualified failures associated with manufacturing defects in material and

workmanship.

Extended Warranty Cover

Extended Warranty covers is also provided under which mechanical and electrical

breakdown of parts like the engine, gear box, steering, brakes, electrical items etc is

covered

To make their customer avail this benefit easily The Extended Warranty is also

available through their dealer network. Under extended Warranty two plans are being

offered.

2. PRICE:

Plan-1

•3rd year or 60,000 kms (whichever comes first) from the date the first owner takes delivery

Plan-2

•3rd and 4th year or 80,000 kms (whichever comes first) from the date the first owner takes delivery


The MSIL generally sets its price to target the Lower middle-class and middle class families

in India. So they set the prices of their car low to make it people‟s car so that person driving

2-wheelers would shift towards driving of 4-wheeler car. For two different engine car

produced by MSIL one Diesel car and another Petrol car it prices their petrol engine car

lower than the diesel engine car in order to scale the sales of petrol engine car as more and

more car buyers are opting for diesel engine car.

The following chart shows the various Products and their Price ranges of the Cars of MSIL in

India.

(image source : http://www.carwale.com/marutisuzuki-cars/)


Maruti achieves its low car pricing strategy through continuous improvements in operational

efficiency and productivity. For this company focuses on two things

A. Improving the productivity

B. Reducing the costs

MSIL in order to provide credit facilities to its customers In a market where more than 80% of cars

are financed, has strategically entered into partnership with financial institutions to provide credit

facilities to their customer in order to make their customer purchase car easily. For this Maruti has

tied up with many public and private finance companies and banks. Some of This Companies are:

a. HDFC Bank

b. ICICI Bank

c. Axis Bank

d. State Bank of India

e. Sundaram Finance Ltd.

f. Cholamandalam Investment and Finance Company Ltd.

Which enables their customers to make payment for their purchased car over long period of

time..

3. PLACE:

This is one of the 4P‟s where MSIL has an advantage over all of its competitors due to their

presence in the country for long time as compared to its rivals. They enjoy a well-distributed

and an extensive network of Car-sale outlets, Exclusive Showrooms, authorised service

stations, True-value Outlets.

MSIL has two Manufacturing facilities setup in Gurgaon and Manesar to the south of Delhi.

The combined capacity for the two plants is 1.5 million vehicles on an annual basis.

Some details of the extensive network for MSIL are:-

Showrooms & Car Sale Outlets – 933 covering 668 cities

Authorized service stations – 3053 nationwide service outlets covering 1395 cities


True-Value Outlets – 668 covering 393 cities (Source: MSIL website)

MSIL makes available all the genuine parts of the car throughout the country so that the car

remains 100% Maruti Suzuki throughout its useful life.

The True-Value Outlets were started with a view to retain the customers under exchange

programs enabling the customers to upgrade their existing car models. Later these outlets

were converted to be a different vertical business unit of MSIL to capture the market for Pre-

owned cars in India based on the high resale value of MSIL cars giving up to 70% returns on

re-sale.

4. PROMOTION:

The company has for most of its years of operation targeted the Indian middle class families

as their main consumers. That‟s why their Promotional strategy has always been to create an

emotional Connect with the audience. MSIL has used various media of promotion

TV – There have been a lot of advertisements through this media as most of the target

audience connects to MSIL through its emotional TV commercials where the company

touches everyone irrespective of their Demographics, Age, Occupations, etc.

Print Media – The Company has also used Newspaper, Magazines to promote its

products to the consumers.

Radio – The Company also uses radio as an important media for advertising its product

line. It sponsors certain shows on air, events for all radio users, etc.


Apart from this, MSIL has also partnered with certain TV shows like “India‟s Got Talent”

and also it provides Sponsorships to certain famous events to make its presence felt. The

company is also involved in certain CSR activities mostly around its manufacturing units to

make the people grow with the company. This all helps in creating a visibility & goodwill for

the company for the non-existing customers and hence, increasing the sales.

MSIL also provides its customers with an “AUTO-Card”. Under which customer earns poin

on every purchase of MSIL product which can be later used as a substitute for money.

MSIL also has a unique program called “DIL SE” for its NRI customers to facilitate them to

gift a MSIL car to their relatives back home in India.

The Company also conducts Mega-Camps where they provide AC & pollution checks,

complimentary Car-wash to its customers to improve customer relations.

MSIL also has an extensive CRM program to manage its relationships with customers. Apart

from all this, the company also has various seasonal Campaigns to target the audience like

festival times to capture the celebrations‟ mood of people and convert it into sales. Festivals

like Navratras, Diwali, etc. are times when you would see such Discounts of 30-40K per car

on offer.

MSIL to differentiate from its’ competitors undertake

various activities:

1. It Caters to the need of all segment and has a product offering at all price.


2. Their pricing strategy is to provide an option to every customer looking for up gradation

in his car. Above are few cars in different range:

(source: http://www.carwale.com/marutisuzuki-cars/)

3. Offering of one stop services to customers

a) Maruti Finance

b) Maruti Insurance

c) Maruti Driving School (MDS)

d) Maruti True Value

4. The customer-friendly approach in its organization culture.

5. Maruti employees & dealers are answerable to even a single complain of customer which

develops customer relationship and encompasses customers to visit MSIL showroom

again.

6. They change their showroom layouts from time to time accordingly to make customer

feel good while visiting to their showrooms.

7. They have Trained Sales Executives who negotiates with customer in finalizing the deal

and creates friendly environment for the customer so that they can clear any doubts

regarding the deal.

• 15-30 lakhsVitara etc..

• 5-10 lakhsBaleno,SX4

• 3-7 lakhsZen, wagon R, Versa, Swift

• Below 3.5 lakhsMaruti800, Alto, Omni


8. They also have Customer complain handling cell under CRM department who looks care

towards customers‟ problem. Which inculcates a feeling in the mind of customer that

their complaints will not be overlooked hear.

9. It also provides online support to their customers Stuck in the city. Where one is stuck in

the back of without help for miles. All they need to do is remember a number. 1800 102

1800. Call and Maruti on Road Service will swing into action.

10. Partnership with SBI & its associate banks took organized finance to small town people

to buy

11. Free maintenance with little extra EMI

12. Conducting free service workshops to encourage consumers to come to their Service

stations

13. The low cost maintenance advantage.

14. Lowest cost of ownership.


5 C’s of Marketing:

1. CUSTOMER:

Customer will find all car related needs met under one roof. It provides a single window

solution for all car related needs.

Maruti has started a number of plans in purpose of well customer service(like vehicle insurance

for rupee one). They have even changed their interior of showroom allowing customers to walk

in the showroom and there are schedules for customer service times and delivery of vehicles. The

Dealer Sales Executive, who is trained on greeting notes, is the first person to interact with the

customer of Maruti when he walks into the Maruti showroom. Under CRM department Maruti

has a cell to handle customer complaints. Another effort by Maruti is the call center where

Maruti can closely interact with its customer. The Market Research department of Maruti studies

varying consumer behavior and needs of market. Maruti‟s claim of being customer friendly

further strengthens because of seventy percent of repeat buyers. There is a lot of investment and

effort involved in developing customer loyalty cum Rewards schemes(joining bonanza,3% value

back, exclusive Benefits).

a). Creating Value to each of the Customers:

Customer Company Competitor Collaboration Context


Authorized Service Stations

Service is a major revenue generator of the company. Most of the service stations are managed

on franchise basis, where Maruti trains its staff.

Maruti Insurance:

Launched in 2002 Maruti provides vehicle insurance to its customers with the help of the

National Insurance Company, Bajaj Allianz, New India Assurance and Royal Sundaram.

Maruti Finance

Maruti has started two joint ventures Citicorp Maruti and Maruti Countrywide with Citi Group

and GE Countrywide respectively to assist its client in securing loan.

Maruti True Value:

One can buy, sell or exchange used Maruti vehicles with the help of this service in India.

2. COMPANY:

a) Product Line:

A product line is a group of products that are closely related to each other by function, customer

group or price range.


b) Goal:

Goals with Maruti is to modernization of the Indian automobile industry, Fuel efficient vehicles

production, to manufacture huge number of vehicles, gain from foreign technology, and the

production of „people‟s car‟ was suitable for Indian people and the climatic conditions which

creates possibility of earning foreign exchange by exporting Maruti products and improving

employment by starting new industries in the market. By improving the research in the market is

determined by manufacturing of better cars would be in demand in Indian market. The main aim

of the Maruti Suzuki production is to take help from Japanese company in its working model,

working culture and in Indian industry they mainly focus on hierarchical discrimination,

inadequate labor, low labor involved, and labor conflict and low recognition with the company.

c) Culture:

Japanese culture imbibed in the employees like same uniform, common canteen, etc

Unique identity to its employees, equal rights for decision making.

d) Technology:

Recently, the company has introduced a peppy k series engine for its new car, Maruti

Suzuki A- star.

It is planning to develop hybrid, electrical, and multi fuel engines.

Manufacturing Global Cars that is fuel – efficient and lower on CO2 emissions.

3. COMPETITORS:

Any person or entity who are rival against another is competitor.

Although most of the major global players are present in the Indian market; few more are

expected to enter due to the welcoming the new government. So there will be tough

competition for Maruti.

Maruti Suzuki faces healthy competition from its competitors. It has direct competition

from Tata Motors limited Mahindra and Mahindra, Hyundai Motor Company, Toyota

Motor Corporation, Honda Motor Corporation and others. In this competing market every


company should be aware of their competitors because Consumers need changes very

fast and your competitor can take the advantage of this. The target customers of Maruti

are basically from middle class family. Maruti generate mostly revenue from middle class

families. Their competitors are also trying to attract this market.

There are some cars which will be launch in future and will give the direct

competition to Maruti.

Upcoming Cars:

Mahindra S101

Honda Jazz

Ford Ka

Tata Bolt

Mahindra Scorpio Facelift

For Figo Concept Sedan

Volkswagen Up

Mahindra Quanto AT

Hyundai Grand i10

Hyundai Elite I20

The cost of all these cars are approximate 3-10lac which will attract to middle class family and it

will direct impact on Maruti.

Targeting Competition in certain segments is very high e.g., small and mid car segment.

Brands like Hyundai, Chevrolet, Tata and Skoda have given huge competition to Maruti

Suzuki. In the recent past Volkswagen, Honda, Ford has also given competition to the

premium car segment.

Superior knowledge of rivals offers a legitimate source of competitive advantage. So it is

required to all marketers to have all knowledge of their competitors.


4. CONTEXT (OR CLIMATE) :

a) Political Environment:

Indian government auto policy aimed at promoting an integrated, phased and conducive

growth of the Indian automotive industry.

Allowing automatic approval for foreign equity investment up to 100 per cent, with no

minimum investment criteria.(Source: http://business.mapsofindia.com)

Establish an international hub for manufacturing small, affordable passenger cars as well

as tractors and two wheelers.

Ensure a balanced transition to open trade at minimal risk to the Indian economy and

local industry.

Laying emphasis on R&D activities carried out by companies in India by giving a

weighted tax deduction of up to 150 per cent for in-house research and R&D activities.

(Source: Economic Times)

b) Economic Environment:

The manufacturing sector has grown at around 7.25 per cent per annum in the last few

years. (Source: http://indianexpress.com)

More than 90 per cent of the CV purchase is on credit.

Finance availability to CV buyers has grown in scope during the last few years.

The increased enforcement of overloading restrictions has also contributed to an increase

in the number of CVs plying on Indian roads.

Several Indian firms have partnered with global players. While some have formed joint

ventures with equity participation, others have entered into technology tie-ups.

Establishment of India as a Manufacturing hub, for mini, compact cars, OEMs, and for

auto components.

c) Social Environment:

Growth in urbanization

Upward migration of household income levels.

Increase in PPP, led to the increase in market share of compact cars.

Cars priced below USD 12000 accounts for nearly 80% of the market.

Vehicles priced between USD 7000 –12000 form the largest segment in the passenger

car market.


Indian customers are highly discerning, educated and well informed. They are price

sensitive and put a lot of emphasis on value for money.

Preference for small and compact cars. They are socially acceptable, even amongst the

well-off.

Preference for fuel efficient cars with low running costs. The Tata Indica has the lowest

running cost at US 8.5 cents per mile.

d) Technological Environment:

With the entry of global companies into the Indian market, advanced technologies, both

in product and production processes have developed.

With the development or evolution of alternate fuels, hybrid cars have made entry into

the market.

Few global companies have setup their R&D centres in India.

Major global players like Audi, BMW, Hyundai etc. have setup their manufacturing units

in India.

Government initiatives regarding tax rebates have led to global players setting up their

R&D centres in India.

Govt. initiatives in establishing NATRIP network across the country will further lead to

enhancing R&D and technological advancements.

e) Ecological Environment:

Physical infra structure such as roads and bridges affect the use of automobiles. If there is

good availability of roads or the roads are smooth then it will affect the use of

automobiles.

Physical conditions like environmental situation affect the use of automobiles. If the

environment is pleasant then it will lead to more use of vehicles.

Technological solutions helps in integrating the supply chain, hence reduce losses and

increase profitability.

5. COLLABORATORS:

Distribution is an important marketing mix. In earlier days the consumers used to book for a car

and wait for more than a year to actually buy it. Also the concept of Show rooms was non-

existent. Even worse thing was the state of the after sales service. With an objective to change

this scenario & to offer better service to customers, Maruti took initiative. To gain competitive

advantage, Maruti Suzuki developed a unique distribution network. Presently the company has a

sales network of 933 centres in 668 towns and cities, and provides service support to customers


at 3053 workshops in over 1395 towns and cities. The basic objective behind establishing the

vast distribution network was to reach the customers even in remote areas and deliver the

products of the company. The company has formed the Dealer territories and the concept of

competition amongst these dealers has been brought about. Periodically corporate image

campaigns in all dealership are carried out. In 2003, to increase the competition the company

implemented a strategy for its dealers to increase their profitability levels. Special awards were

sometimes given by company for sales of special categories. Maruti Suzuki had given an

opportunity to dealers to make more profits from various avenues like used car finance and

insurance services. In 2001, Maruti started an initiative known as ‗Non Stop Maruti Express

Highway„. As a part of this initiative Maruti developed 255 customer service outlets along with

21 highway routes by 2001-02. Also with an intention to provide fast service in less time Maruti

had offered Express Service Facility. In the year 2008, Maruti had near about 2,500 rural dealer

sales executives, among the total 15,000 dealer sales executives.

EXECUTIVE SUMMARY

Maruti Suzuki is the leading four-wheeler automobile manufacture in South Asia. Which

captures a biggest market share of around 50% for which it implies various marketing strategy

from various product features to different advertising channels to Diffrent pricing policy in order

to capture a bigger market share and not to let its customer run away i had even implied a new

marketing strategy in the terms of true value shop so that in no way customer get switched over

to other brand.

A 4-P analysis done on the company shows:

The company offers a wide product range.


It has a range of cars from 2 to 26 lakhs. The price is decided by the quality and design

of the product.

It decides its distribution channel on its own, which is sometimes one level or a two level

marketing channel.

For promotion, it uses both print as well as the electronic media. It tries to create an

emotional connect with the customers (which are mainly the Indian middle class

population).

The 5 C’s of marketing of Maruti Suzuki shows:

Maruti has a number of plans to provide well customer service to its customers which

includes providing all accessories under one roof, easy finance facility, showrooms, etc.

The company focuses on improving its technology and provide maximum customer

satisfaction.

The main competitors are: Honda, Chevrolet, Tata, Mahindra, Hyundai and Ford.

The main context of the company are various political, economic, social, technological,

and ecological environments.

It has a unique distribution channel. It has sales network of 933 centers in 668 towns and

cities, and provides service support to customers at 3053 workshops in over 1395 towns

and cities.

REFERENCES:

1. MSIL Website:

http://www.marutisuzuki.com/

http://www.marutisuzuki.com/maruti-finance.aspx

http://www.marutisuzuki.com/maruti-insurance.aspx

http://www.marutisuzuki.com/maruti-genuine-part.aspx

http://www.marutisuzuki.com/autocard.aspx

http://www.marutisuzuki.com/pre-owned-car.aspx

http://www.marutisuzuki.com/

http://www.marutisuzuki.com/maruti-finance.aspx

http://www.marutisuzuki.com/maruti-insurance.aspx

http://www.marutisuzuki.com/maruti-genuine-part.aspx

http://www.marutisuzuki.com/autocard.aspx

http://www.marutisuzuki.com/pre-owned-car.aspx


http://www.marutisuzuki.com/maruti-driving-school.aspx

2. Times of India: http://timesofindia.indiatimes.com/business/india-business/Marutis-rural-

market-share-races-from-3-5-to-31-in-five-years/articleshow/30315161.cms

3. Indian express : http://indianexpress.com

4. Carwale.com http://www.carwale.com/marutisuzuki-cars/

5. Mapsofindia.com http://business.mapsofindia.com/

http://www.marutisuzuki.com/maruti-driving-school.aspx

http://timesofindia.indiatimes.com/business/india-business/Marutis-rural-market-share-races-from-3-5-to-31-in-five-years/articleshow/30315161.cms

http://timesofindia.indiatimes.com/business/india-business/Marutis-rural-market-share-races-from-3-5-to-31-in-five-years/articleshow/30315161.cms

http://indianexpress.com/

http://www.carwale.com/marutisuzuki-cars/

http://business.mapsofindia.com/

Education

MARUTI SUZUKI PRODUCT ANALYSIS REPORT