Hero motocorp project report
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Oct 01, 2020
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About This Presentation
A project report on Hero Motocorp
Slide Content
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 1
CHAPTER 1
INTRODUCTION
1.1 Part - A
INDUSTRY PROFILE
Indian Two-Wheeler Industry is the largest in the world as far as the volume of
production and sales are concerned. India is the biggest two-wheeler market on this
planet, registering an overall growth rate of 9.5 percent between 2006 and 2014. The
growth in Indian Automobile Industry owed the most to a steep upsurge witnessed in the
two-wheeler segment till 2014. The volume growth recorded in the 2014-15 fiscal year
stood at a commendable 14.8 percent on a year-on-year basis. The 'Make in India'
campaign of the Government of India is also going to attract more foreign investment
into Indian Two-Wheeler Industry creating further growth opportunities in the coming
years.
The automobile sector is divided into four segments two-wheeler (mopeds, scooters,
motorcycle, electric two-wheeler), passenger vehicles (passenger cars, utility vehicle,
multi-purpose vehicles), commercial vehicle (light and medium heavy vehicles), and
three wheelers (passenger carries and goods carries). The industry is the key drivers of
economic growth of the nation. Since the globalization of the sector in 1991 and the
subsequent opening of 100 percent FDI through automatic route, Indian automobile
sector has come a long way. Today, almost every global auto major has set up facilities in
the country.
The world standing for the Indian automobile sector, as per the confederation of Indian
industry, are as follows:
RNS FIRST GRADE COLLEGE Page 1
CHAPTER 1
INTRODUCTION
1.1 Part - A
INDUSTRY PROFILE
Indian Two-Wheeler Industry is the largest in the world as far as the volume of
production and sales are concerned. India is the biggest two-wheeler market on this
planet, registering an overall growth rate of 9.5 percent between 2006 and 2014. The
growth in Indian Automobile Industry owed the most to a steep upsurge witnessed in the
two-wheeler segment till 2014. The volume growth recorded in the 2014-15 fiscal year
stood at a commendable 14.8 percent on a year-on-year basis. The 'Make in India'
campaign of the Government of India is also going to attract more foreign investment
into Indian Two-Wheeler Industry creating further growth opportunities in the coming
years.
The automobile sector is divided into four segments two-wheeler (mopeds, scooters,
motorcycle, electric two-wheeler), passenger vehicles (passenger cars, utility vehicle,
multi-purpose vehicles), commercial vehicle (light and medium heavy vehicles), and
three wheelers (passenger carries and goods carries). The industry is the key drivers of
economic growth of the nation. Since the globalization of the sector in 1991 and the
subsequent opening of 100 percent FDI through automatic route, Indian automobile
sector has come a long way. Today, almost every global auto major has set up facilities in
the country.
The world standing for the Indian automobile sector, as per the confederation of Indian
industry, are as follows:
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 2
Largest three-wheeler market
Second largest two-wheeler market
Tenth largest passenger car market
Fourth largest tractor market
Fifth largest commercial vehicle market
Fifth largest bus and truck segment
Two-Wheeler Market in India:
Indian Two-Wheeler Market is noticing a continuous upsurge in demand and thus
resulting in growing production and sales volume. This owes a lot to the launching of
new attractive models at affordable prices, design innovations made from youths‟
perspective and latest technology utilized in manufacturing of vehicles. The sale of two-
wheeler products has increased substantially. The sales volumes in the two-wheeler
sector shot up from 15 percent to 24 percent between 2008-09 and 2013-14. A
considerable expansion was seen in the sales volume of the scooter segment during 2014-
15 as far as the two-wheelers were concerned. This positive node makes many new
players enter in this density market.
The domestic motorcycle sales volume moved up to 10 percent, whereas the scooter
segment recorded a growth of 30.7 percent in sales volume. In the past 2-3 years, around
a dozen new scooter brands have been introduced in India. But the motorcycle segment
lags behind in this regard. This is due to the fact that the recently launched gearless
scooters cater to the needs of both men and women, while motorbikes are a segment
preferred by men only. The growth momentum is also propelled by the fact that the two-
wheeler manufacturers in India have understood the market‟s needs and have been able
to deliver as expected. At the end of 2014, the global business involving two-wheeler
designing, manufacturing, engineering and selling was at an average of US$ 3.5 billion
per manufacturer. Though, further growth in Indian Two-Wheeler Industry will depend
RNS FIRST GRADE COLLEGE Page 2
Largest three-wheeler market
Second largest two-wheeler market
Tenth largest passenger car market
Fourth largest tractor market
Fifth largest commercial vehicle market
Fifth largest bus and truck segment
Two-Wheeler Market in India:
Indian Two-Wheeler Market is noticing a continuous upsurge in demand and thus
resulting in growing production and sales volume. This owes a lot to the launching of
new attractive models at affordable prices, design innovations made from youths‟
perspective and latest technology utilized in manufacturing of vehicles. The sale of two-
wheeler products has increased substantially. The sales volumes in the two-wheeler
sector shot up from 15 percent to 24 percent between 2008-09 and 2013-14. A
considerable expansion was seen in the sales volume of the scooter segment during 2014-
15 as far as the two-wheelers were concerned. This positive node makes many new
players enter in this density market.
The domestic motorcycle sales volume moved up to 10 percent, whereas the scooter
segment recorded a growth of 30.7 percent in sales volume. In the past 2-3 years, around
a dozen new scooter brands have been introduced in India. But the motorcycle segment
lags behind in this regard. This is due to the fact that the recently launched gearless
scooters cater to the needs of both men and women, while motorbikes are a segment
preferred by men only. The growth momentum is also propelled by the fact that the two-
wheeler manufacturers in India have understood the market‟s needs and have been able
to deliver as expected. At the end of 2014, the global business involving two-wheeler
designing, manufacturing, engineering and selling was at an average of US$ 3.5 billion
per manufacturer. Though, further growth in Indian Two-Wheeler Industry will depend
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 3
heavily on people’s personal disposable incomes that rely on India's economic growth in
days to come.
As the cites grows & suburbs expand, transportation needs becoming more & more acute,
with the mounting pressure on its public transportation for which two wheelers are ideal.
The two wheeler industry today has significant role in the Indian economy, with an
annual turnover of Rs. 9000 crores and compounded average growth of 10%. In recent
years, it is of the few industrial sectors in the growth phase today considers personal
transportation as one of the basic needs.
Major part of the two-wheeler industry has come from motorcycle especially, the Indo-
Japanese 100cc motorcycles, which are considered, fuel efficient, reliable and suited for
rough roads.
Scooters also growing at a fast phase and are being increasingly perceived as a better
option providing convenience and motor style, by urban customers. In this category, TVS
scotty holds a dominant market share.
The Two-wheeler industry is passing through a critical but interesting phase. For many
years, it was growing continuously but the turning point came in 1996=97 when it started
down. The impact was really (MI) felt in the next year when the overall growth was
hardly two percent and mopeds by 6 percent.
Another highlight is that motorcycle sales have surpassed the scooter sale for the first
time in 1998-99. Until then, motorcycle sales were always trailing behind.
Indian Two-Wheeler Industry:
The two-wheeler segment is the only one that has clocked growth at 12.9 percent YoY
(year-on-year) to reach sales of nearly 13.5 million units by October. This can be
attributed to the low cost of two wheelers in India.
RNS FIRST GRADE COLLEGE Page 3
heavily on people’s personal disposable incomes that rely on India's economic growth in
days to come.
As the cites grows & suburbs expand, transportation needs becoming more & more acute,
with the mounting pressure on its public transportation for which two wheelers are ideal.
The two wheeler industry today has significant role in the Indian economy, with an
annual turnover of Rs. 9000 crores and compounded average growth of 10%. In recent
years, it is of the few industrial sectors in the growth phase today considers personal
transportation as one of the basic needs.
Major part of the two-wheeler industry has come from motorcycle especially, the Indo-
Japanese 100cc motorcycles, which are considered, fuel efficient, reliable and suited for
rough roads.
Scooters also growing at a fast phase and are being increasingly perceived as a better
option providing convenience and motor style, by urban customers. In this category, TVS
scotty holds a dominant market share.
The Two-wheeler industry is passing through a critical but interesting phase. For many
years, it was growing continuously but the turning point came in 1996=97 when it started
down. The impact was really (MI) felt in the next year when the overall growth was
hardly two percent and mopeds by 6 percent.
Another highlight is that motorcycle sales have surpassed the scooter sale for the first
time in 1998-99. Until then, motorcycle sales were always trailing behind.
Indian Two-Wheeler Industry:
The two-wheeler segment is the only one that has clocked growth at 12.9 percent YoY
(year-on-year) to reach sales of nearly 13.5 million units by October. This can be
attributed to the low cost of two wheelers in India.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 4
Largest two-wheeler market globally, at a CAGR of 14.9% in sales.
Overall growth - 12.9 % by volume YoY.
Revenue estimated about Rs. 923 billion in 2014-2015.
Three major segments: Motorcycles, Scooty and Mopeds.
Productive Capacity:
Hero Moto Cop - 7.6 million
HMSI - 4.6 M
Bajaj Auto - 5M
TVS Motors - 2.5M
Royal Enfield - 1,50,000
GROWTH OF MOTORCYCLES
RNS FIRST GRADE COLLEGE Page 4
Largest two-wheeler market globally, at a CAGR of 14.9% in sales.
Overall growth - 12.9 % by volume YoY.
Revenue estimated about Rs. 923 billion in 2014-2015.
Three major segments: Motorcycles, Scooty and Mopeds.
Productive Capacity:
Hero Moto Cop - 7.6 million
HMSI - 4.6 M
Bajaj Auto - 5M
TVS Motors - 2.5M
Royal Enfield - 1,50,000
GROWTH OF MOTORCYCLES
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 5
It is therefore not surprising that every major player is trying to get into the motorcycle
market to have a piece of the cake.
Hero Motocorp Ltd is indisputable the leader with 38 percent share followed by Bajaj
with 27 percent (includes M-80), TVS at 19 percent and Escorts at 13 percent. Now LML
and kinetic have announced their plans to manufacture motorcycles, which likely to come
in the market by next year. The battle is expected to be fierce but consumer will be the
greater beneficiary.
The growth in motorcycles is slowly losing its hold. It is considered a family vehicle but
perhaps there is competition from the second-hand car markets where prices have fallen
rapidly. A 1992 Maruti 800 is now available for just 70,000.
The scooter manufactures must watch this phenomenon and bring our many new
products variants in the right price slots to sustain their shares in the market. The moped
market has been steady with an average growth of 3 percent. It is dominated by TVS
which holds 48 percent market share followed by kinetic and majestic auto at 23 percent
and 18 percent respectively.
In each segment, there is a wide gap between the first two contenders, which makes their
products positioning and marketing strategies most interesting. The two-wheeler market
seems to be maturing. There are the usual their conventional segment of scooters, mopeds
and motorcycles. Two new segments are being created.
Current Strategies followed by the Manufacturers
Hero Moto Corp’s key strategies are to build a robust product portfolio across categories,
explore growth opportunities globally, continuously improve its operational efficiency,
aggressively expand its reach to customers, continue to invest in brand building activities
RNS FIRST GRADE COLLEGE Page 5
It is therefore not surprising that every major player is trying to get into the motorcycle
market to have a piece of the cake.
Hero Motocorp Ltd is indisputable the leader with 38 percent share followed by Bajaj
with 27 percent (includes M-80), TVS at 19 percent and Escorts at 13 percent. Now LML
and kinetic have announced their plans to manufacture motorcycles, which likely to come
in the market by next year. The battle is expected to be fierce but consumer will be the
greater beneficiary.
The growth in motorcycles is slowly losing its hold. It is considered a family vehicle but
perhaps there is competition from the second-hand car markets where prices have fallen
rapidly. A 1992 Maruti 800 is now available for just 70,000.
The scooter manufactures must watch this phenomenon and bring our many new
products variants in the right price slots to sustain their shares in the market. The moped
market has been steady with an average growth of 3 percent. It is dominated by TVS
which holds 48 percent market share followed by kinetic and majestic auto at 23 percent
and 18 percent respectively.
In each segment, there is a wide gap between the first two contenders, which makes their
products positioning and marketing strategies most interesting. The two-wheeler market
seems to be maturing. There are the usual their conventional segment of scooters, mopeds
and motorcycles. Two new segments are being created.
Current Strategies followed by the Manufacturers
Hero Moto Corp’s key strategies are to build a robust product portfolio across categories,
explore growth opportunities globally, continuously improve its operational efficiency,
aggressively expand its reach to customers, continue to invest in brand building activities
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 6
and ensure customer and shareholder delight. 50mn+ Sales (cumulative sales since
inception) world’s fastest two-wheeler company to achieve this.
New Segments of Motors
Among the majors in the tow wheeler industry, first quarter figure for the current year of some
players been encouraging. The company sold 313,303 units last month as compared to 325,360
units in the same month last year. With this, BAL has recorded as 87 percent growth in the
motorcycle segment in the first quarter with sales of 130,577 units (93,631 units in the
corresponding period last year).BAL estimates market share of the first quarter- gearted scooter
75.9% , unguarded scooters 16.5, step-thrus 72.3% and motorcycle 20.5%.
RNS FIRST GRADE COLLEGE Page 6
and ensure customer and shareholder delight. 50mn+ Sales (cumulative sales since
inception) world’s fastest two-wheeler company to achieve this.
New Segments of Motors
Among the majors in the tow wheeler industry, first quarter figure for the current year of some
players been encouraging. The company sold 313,303 units last month as compared to 325,360
units in the same month last year. With this, BAL has recorded as 87 percent growth in the
motorcycle segment in the first quarter with sales of 130,577 units (93,631 units in the
corresponding period last year).BAL estimates market share of the first quarter- gearted scooter
75.9% , unguarded scooters 16.5, step-thrus 72.3% and motorcycle 20.5%.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 7
Kinetic motors, another important player, managed to grow in 1999-2000, when the scooter
segments a whole slipped by around 5 percent. TVS Suzuki, a motor two-wheeler market, has
reported a growth of 13 percent in the first quarter period and sold 2.19 lakh units. Sales of
motorcycles and scooter were up by 18 percent and that of mopeds by 8 percent over the same
period last year.
A step is through segment like kinetic K4-100, Honda Street, bajaj M-80, which is quit close to
the motorcycle segment. The other segment is scooterettes or mini scooter in which vehicles such
as kinetic SX/style, hero winner, Bajaj sunny and LML trendy can be considered. These are the
vehicles under 75cc and largely targeted at the youth market such as college students, young boys
and girls and new couples.
Hero MotoCorp ltd enjoys tremendous brand equity in the motorcycle segment.
History of two-wheeler industry
The Indian economy faces internal challenges that are inevitable in such a large and
diverse country as ours. The domestic automotive industry, which is a significant
contributor to the Indian economy, has not remained immune to these challenges. Thus,
the two-wheeler industry has gone through a sluggish phase for the past few years.
Despite the adverse environment, our company has maintained its market leadership,
staving off intense competition. The conclusion of FY 2015-16 marked the completion of
five years of our solo journey. During this time, our company has proven its inherent
capabilities and resilience to not just retain its leadership at home, but also transform
itself into a global automotive player with robust in-house research, design and
development capabilities.
Hero MotoCorp is already a global leader in developing energy-efficient mobility
solutions. Be it through our Garden Factory at Neemrana or the fuel-efficient i3S
technology, we have set global benchmarks in promoting environment-friendly
manufacturing. For carving out a distinctive niche in building sustainable platforms for
RNS FIRST GRADE COLLEGE Page 7
Kinetic motors, another important player, managed to grow in 1999-2000, when the scooter
segments a whole slipped by around 5 percent. TVS Suzuki, a motor two-wheeler market, has
reported a growth of 13 percent in the first quarter period and sold 2.19 lakh units. Sales of
motorcycles and scooter were up by 18 percent and that of mopeds by 8 percent over the same
period last year.
A step is through segment like kinetic K4-100, Honda Street, bajaj M-80, which is quit close to
the motorcycle segment. The other segment is scooterettes or mini scooter in which vehicles such
as kinetic SX/style, hero winner, Bajaj sunny and LML trendy can be considered. These are the
vehicles under 75cc and largely targeted at the youth market such as college students, young boys
and girls and new couples.
Hero MotoCorp ltd enjoys tremendous brand equity in the motorcycle segment.
History of two-wheeler industry
The Indian economy faces internal challenges that are inevitable in such a large and
diverse country as ours. The domestic automotive industry, which is a significant
contributor to the Indian economy, has not remained immune to these challenges. Thus,
the two-wheeler industry has gone through a sluggish phase for the past few years.
Despite the adverse environment, our company has maintained its market leadership,
staving off intense competition. The conclusion of FY 2015-16 marked the completion of
five years of our solo journey. During this time, our company has proven its inherent
capabilities and resilience to not just retain its leadership at home, but also transform
itself into a global automotive player with robust in-house research, design and
development capabilities.
Hero MotoCorp is already a global leader in developing energy-efficient mobility
solutions. Be it through our Garden Factory at Neemrana or the fuel-efficient i3S
technology, we have set global benchmarks in promoting environment-friendly
manufacturing. For carving out a distinctive niche in building sustainable platforms for
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 8
future growth, Hero MotoCorp was bestowed with the coveted ‘Manufacturing Innovator
of the Year’ award at the inaugural TIME India Awards. It was indeed a great privilege to
receive the award from the Honorable Prime Minister, Shri Narendra Modi at the ‘Make
in India Week’.
Our Centre of Innovation and Technology (CIT), the core of Hero’s research and
development, began operating in March 2016. The CIT is a one-of-its-kind facility
housing all aspects of research, development and testing capabilities under one roof. With
a team of highly talented engineers drawn from within the country and from around the
world, the CIT will be the origin of all future products and technologies from Hero
MotoCorp. In September 2015, our company established its first overseas facility in
Colombia to expand our manufacturing base.
In the process, Hero became the first Indian two-wheeler company to have a
manufacturing facility in Latin America. This facility will also act as an exports hub for
the Andean countries. During the year, Hero MotoCorp has also expanded its global
presence to 32 countries across Asia, Africa and South and Central America. This fiscal
year also marks two very significant milestones in Hero’s solo journey as a company.
Firstly, in October 2015, Hero introduced the Maestro Edge and Duet scooters - the very
first products to have been completely designed and developed by our in-house R&D
team. Attractively designed with contemporary styling and loaded with a host of unique
features, Maestro Edge and Duet have been well received by customers, helping our
company increase its market share in the scooter segment.
Secondly, in February 2016, during the Auto Expo, we showcased another one of our
new innovations, Splendor iSmart 110 - the first motorcycle to have been designed and
developed completely in-house by Hero R&D. Splendor iSmart 110 has already received
a positive initial response in the market. With the launch of these three all-new products -
the Maestro Edge, the Duet and the Splendor iSmart 110 – our company has now proven
its technology capabilities to develop world-class products fit for the global audience.
RNS FIRST GRADE COLLEGE Page 8
future growth, Hero MotoCorp was bestowed with the coveted ‘Manufacturing Innovator
of the Year’ award at the inaugural TIME India Awards. It was indeed a great privilege to
receive the award from the Honorable Prime Minister, Shri Narendra Modi at the ‘Make
in India Week’.
Our Centre of Innovation and Technology (CIT), the core of Hero’s research and
development, began operating in March 2016. The CIT is a one-of-its-kind facility
housing all aspects of research, development and testing capabilities under one roof. With
a team of highly talented engineers drawn from within the country and from around the
world, the CIT will be the origin of all future products and technologies from Hero
MotoCorp. In September 2015, our company established its first overseas facility in
Colombia to expand our manufacturing base.
In the process, Hero became the first Indian two-wheeler company to have a
manufacturing facility in Latin America. This facility will also act as an exports hub for
the Andean countries. During the year, Hero MotoCorp has also expanded its global
presence to 32 countries across Asia, Africa and South and Central America. This fiscal
year also marks two very significant milestones in Hero’s solo journey as a company.
Firstly, in October 2015, Hero introduced the Maestro Edge and Duet scooters - the very
first products to have been completely designed and developed by our in-house R&D
team. Attractively designed with contemporary styling and loaded with a host of unique
features, Maestro Edge and Duet have been well received by customers, helping our
company increase its market share in the scooter segment.
Secondly, in February 2016, during the Auto Expo, we showcased another one of our
new innovations, Splendor iSmart 110 - the first motorcycle to have been designed and
developed completely in-house by Hero R&D. Splendor iSmart 110 has already received
a positive initial response in the market. With the launch of these three all-new products -
the Maestro Edge, the Duet and the Splendor iSmart 110 – our company has now proven
its technology capabilities to develop world-class products fit for the global audience.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 9
Having laid a strong platform of technology and production capabilities, our aim now is
to further expand our portfolio and develop technologies that will have a positive and
sustainable impact on the world. The road ahead is indeed challenging, yet Hero has
proven time and again that we can turn adversity into opportunity. We are currently
working on developing a series of new products across multiple segments, including
those in the premium space. We are also working on developing next generation
technologies to stay ahead of the curve, so that our company is future-ready. At the same
time, Hero continues to engage with our customers across urban and rural markets. Our
innovative rural initiative ‘Har Gaon Har Aangan’ (Every Village Every Household) has
been one of the most successful rural customer engagement programmes, and will
continue to give us the competitive edge in the domestic market.
Considering the low two-wheeler penetration in the country, our company sees a
tremendous growth potential for many years to come. Despite the current headwinds in
several markets across Latin America and Africa, we will continue to expand our
footprint in the global markets. Our upcoming manufacturing facility in Bangladesh,
which will become operational this fiscal year, is set to be yet another important
milestone in our global journey.
Dramatic changes in Hero Motocrop
Hero motocorp is now world’s largest manufacturer of two-wheelers. The company has
benefited from the demand shift to motorcycles, as it focuses solely on this product
segment (although has a product called pleasure in scooter segment). With fuel efficiency
and riding comfort as the main selling points, HMS has been able to address a wide
market and post robust sales growth even after its separation from the Japanese major
Honda.
RNS FIRST GRADE COLLEGE Page 9
Having laid a strong platform of technology and production capabilities, our aim now is
to further expand our portfolio and develop technologies that will have a positive and
sustainable impact on the world. The road ahead is indeed challenging, yet Hero has
proven time and again that we can turn adversity into opportunity. We are currently
working on developing a series of new products across multiple segments, including
those in the premium space. We are also working on developing next generation
technologies to stay ahead of the curve, so that our company is future-ready. At the same
time, Hero continues to engage with our customers across urban and rural markets. Our
innovative rural initiative ‘Har Gaon Har Aangan’ (Every Village Every Household) has
been one of the most successful rural customer engagement programmes, and will
continue to give us the competitive edge in the domestic market.
Considering the low two-wheeler penetration in the country, our company sees a
tremendous growth potential for many years to come. Despite the current headwinds in
several markets across Latin America and Africa, we will continue to expand our
footprint in the global markets. Our upcoming manufacturing facility in Bangladesh,
which will become operational this fiscal year, is set to be yet another important
milestone in our global journey.
Dramatic changes in Hero Motocrop
Hero motocorp is now world’s largest manufacturer of two-wheelers. The company has
benefited from the demand shift to motorcycles, as it focuses solely on this product
segment (although has a product called pleasure in scooter segment). With fuel efficiency
and riding comfort as the main selling points, HMS has been able to address a wide
market and post robust sales growth even after its separation from the Japanese major
Honda.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 10
The coming year will be increasing competition due to the parity in products and price.
The only differentiators will be technology, quality, product\ range and service.
Imaginative marketing will emphasize relationship building, customer satisfaction and
relationship. All is exploring new techniques such as direct marketing and institutional
sales. Some of them are taking the vehicle to the customer’s doorstep. Now the customer
is the king.
Major Development & Investments
Mahindra & Mahindra (M&M) plans to develop the world’s first hybrid technology
that can be deployed in vehicles with manual transmission and enhance fuel
efficiency by almost 20 percent.
Amtek Auto has signed as agreement to buy Germany-based kuepper Group of
companies for about 20 million (US$ 272.73 million) in its second big European
acquisition in 2013.
Tata Motors Ltd plans to invest about 30 million (US$ 49.17 million) in the National
Automotive Innovation Campus (NAIC) for research and development (R&D).
Tata motors-owned Jaguar Land Rover (JLR) has entered in to an agreement with
the state of Rio de Janeiro to build a manufacturing plant in Brazil with an
investment of Rs 4,626 crore (US$ 751.95 million).
Honda cars India will use the Ennore port to export cars to south Africa. The
infrastructure for car exports at Ennore port is attractive and cost effective.
Manufacturing companies in Japan continue to view India has the top destination for
investments-over china, Thailand, Vietnam, Brazil and Indonesia-in the next three
years, according to Mr. Masanori Nakano, consul General of Japan in Chennai.
RNS FIRST GRADE COLLEGE Page 10
The coming year will be increasing competition due to the parity in products and price.
The only differentiators will be technology, quality, product\ range and service.
Imaginative marketing will emphasize relationship building, customer satisfaction and
relationship. All is exploring new techniques such as direct marketing and institutional
sales. Some of them are taking the vehicle to the customer’s doorstep. Now the customer
is the king.
Major Development & Investments
Mahindra & Mahindra (M&M) plans to develop the world’s first hybrid technology
that can be deployed in vehicles with manual transmission and enhance fuel
efficiency by almost 20 percent.
Amtek Auto has signed as agreement to buy Germany-based kuepper Group of
companies for about 20 million (US$ 272.73 million) in its second big European
acquisition in 2013.
Tata Motors Ltd plans to invest about 30 million (US$ 49.17 million) in the National
Automotive Innovation Campus (NAIC) for research and development (R&D).
Tata motors-owned Jaguar Land Rover (JLR) has entered in to an agreement with
the state of Rio de Janeiro to build a manufacturing plant in Brazil with an
investment of Rs 4,626 crore (US$ 751.95 million).
Honda cars India will use the Ennore port to export cars to south Africa. The
infrastructure for car exports at Ennore port is attractive and cost effective.
Manufacturing companies in Japan continue to view India has the top destination for
investments-over china, Thailand, Vietnam, Brazil and Indonesia-in the next three
years, according to Mr. Masanori Nakano, consul General of Japan in Chennai.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 11
1.2 PART-B
ABOUT THE SUBJECT
MARKETING
Introduction:
In today’s world of marketing, everywhere you go you are being marketed to in one form
or another. Marketing is which you each second of your walking life. From morning to
night, you are exposed to thousands of marketing messages every day. Marketing is
something that affects you even through you may not necessarily be conscious about it.
Meaning of Marketing:
“Marketing is communicating the value of product or service to customers, for selling the
product or service”.
Marketing techniques includes choosing target market through market analysis and
market segmentation, as well as understanding consumer behavior and advertising a
product’s value to customer. From a societal point of view, marketing is the link between
a society’s material requirements and its economic patterns of response. Marketing
satisfies these needs and wants through exchange process and building long-term
relationships. Marketing blends art and applied science and makes use of information
technology.
Marketing is the process of interesting potential customers and clients in your products
and services. The key word in this marketing definition is “process”, marketing involves
researching, promoting, selling, and distributing your products or services.
RNS FIRST GRADE COLLEGE Page 11
1.2 PART-B
ABOUT THE SUBJECT
MARKETING
Introduction:
In today’s world of marketing, everywhere you go you are being marketed to in one form
or another. Marketing is which you each second of your walking life. From morning to
night, you are exposed to thousands of marketing messages every day. Marketing is
something that affects you even through you may not necessarily be conscious about it.
Meaning of Marketing:
“Marketing is communicating the value of product or service to customers, for selling the
product or service”.
Marketing techniques includes choosing target market through market analysis and
market segmentation, as well as understanding consumer behavior and advertising a
product’s value to customer. From a societal point of view, marketing is the link between
a society’s material requirements and its economic patterns of response. Marketing
satisfies these needs and wants through exchange process and building long-term
relationships. Marketing blends art and applied science and makes use of information
technology.
Marketing is the process of interesting potential customers and clients in your products
and services. The key word in this marketing definition is “process”, marketing involves
researching, promoting, selling, and distributing your products or services.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 12
Definition of Marketing:
According to American marketing association (2004) “marketing is an origination
function and set of processes for creating, communicating and delivering value to
customers and for managing relationships in a way that benefits both the origination and
the stakeholder”.
According to Phillip Kotler (2000) “A societal process by which individuals and groups
obtain what they need and want through creating, offering and freely exchanging
products and services of value with others”.
Nature of Marketing
1. Marketing is Economic Function
Marketing embraces all the business activities involved in getting goods and services,
from the hands of producers into hands of final consumers. The business steps through
which goods progress on their way to final consumer is the concern of marketing.
2. Marketing is a legal process by which ownership transfers
In the process of marketing the ownership of goods transfer from seller to the purchaser
or from producer to the end user.
3. Marketing is system of interacting business activities
Marketing is the process through which business enterprise, institution, or organization
interacts with the customers and stakeholders with the objective to earn profit, satisfy
RNS FIRST GRADE COLLEGE Page 12
Definition of Marketing:
According to American marketing association (2004) “marketing is an origination
function and set of processes for creating, communicating and delivering value to
customers and for managing relationships in a way that benefits both the origination and
the stakeholder”.
According to Phillip Kotler (2000) “A societal process by which individuals and groups
obtain what they need and want through creating, offering and freely exchanging
products and services of value with others”.
Nature of Marketing
1. Marketing is Economic Function
Marketing embraces all the business activities involved in getting goods and services,
from the hands of producers into hands of final consumers. The business steps through
which goods progress on their way to final consumer is the concern of marketing.
2. Marketing is a legal process by which ownership transfers
In the process of marketing the ownership of goods transfer from seller to the purchaser
or from producer to the end user.
3. Marketing is system of interacting business activities
Marketing is the process through which business enterprise, institution, or organization
interacts with the customers and stakeholders with the objective to earn profit, satisfy
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 13
customer, and manage relationship. It is the performance of business activities that direct
the flow of goods and services from producer to consumers.
4. Marketing is a Managerial Function
According to managerial or system approach “marketing is the combination of activities
designed to produce profit through ascertaining, creating, stimulating, and satisfying the
needs and/or wants of a selected segment of the market”.
According to this approach the emphasis is how the individual organization processes
marketing and develops the strategic dimensions of marketing activities.
5. Marketing is a social process
Marketing is the delivery of a standard of living to society. According to Cunningham
and Cunningham (1981) societal marketing performs three essential functions:
Knowing and understanding the consumer’s changing needs and wants.
Efficiently and effectively managing the supply and demand of products and
services.
Efficient provision of distribution and payment processing system.
6. Creation of goodwill and public image
To build up the public image of a firm over a period is another objective of marketing.
The marketing department provides quality products to customer at reasonable prices and
thus creates its impact on the customer.
RNS FIRST GRADE COLLEGE Page 13
customer, and manage relationship. It is the performance of business activities that direct
the flow of goods and services from producer to consumers.
4. Marketing is a Managerial Function
According to managerial or system approach “marketing is the combination of activities
designed to produce profit through ascertaining, creating, stimulating, and satisfying the
needs and/or wants of a selected segment of the market”.
According to this approach the emphasis is how the individual organization processes
marketing and develops the strategic dimensions of marketing activities.
5. Marketing is a social process
Marketing is the delivery of a standard of living to society. According to Cunningham
and Cunningham (1981) societal marketing performs three essential functions:
Knowing and understanding the consumer’s changing needs and wants.
Efficiently and effectively managing the supply and demand of products and
services.
Efficient provision of distribution and payment processing system.
6. Creation of goodwill and public image
To build up the public image of a firm over a period is another objective of marketing.
The marketing department provides quality products to customer at reasonable prices and
thus creates its impact on the customer.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 14
Scope of Marketing
1. Study to Customer and Needs
Goods are produced to satisfy consumer wants. Therefore, study is done to identify
consumer needs and wants. These needs and wants motivates consumer to purchase.
2. Study on Consumer Behavior
A marketer performs study of consumer behavior. Analysis of buyer behavior helps
marketer in market segmentation and targeting.
3. Product Planning and Development
Product planning and development starts with the generation of product idea and ends
with the product development and commercialization. Product planning includes
everything from branding and packaging to product line expansion and contraction.
4. Pricing Policies
Marketer must determine pricing for their products. Pricing policies differs from product
to product. It depends on the level of competition, product life cycle, marketing goals and
objectives, etc.
5. Distribution
Study of distribution channel is important in marketing. For maximum sales and profits
goods are required to be distributed to the maximum consumers at minimum cost.
RNS FIRST GRADE COLLEGE Page 14
Scope of Marketing
1. Study to Customer and Needs
Goods are produced to satisfy consumer wants. Therefore, study is done to identify
consumer needs and wants. These needs and wants motivates consumer to purchase.
2. Study on Consumer Behavior
A marketer performs study of consumer behavior. Analysis of buyer behavior helps
marketer in market segmentation and targeting.
3. Product Planning and Development
Product planning and development starts with the generation of product idea and ends
with the product development and commercialization. Product planning includes
everything from branding and packaging to product line expansion and contraction.
4. Pricing Policies
Marketer must determine pricing for their products. Pricing policies differs from product
to product. It depends on the level of competition, product life cycle, marketing goals and
objectives, etc.
5. Distribution
Study of distribution channel is important in marketing. For maximum sales and profits
goods are required to be distributed to the maximum consumers at minimum cost.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 15
6. Promotion
Promotions include personal selling, sales promotion and advertising. Right promotion
mix is crucial in accomplishment of marketing goals.
7. Consumer satisfaction
The product or service offered must satisfy consumer. Consumer satisfaction is the major
objective of marketing.
Market segmentation
Meaning of market segmentation:
Market segmentation is the process of dividing an entire market up into different
customer segments. Target marketing then entails deciding which potential customer
segments the company will focus on market segmentation.
Market segmentation is the marketing term referring to the aggregating of prospective
buyers into groups, or segment that have common needs and respond similarly to a
marketing action.
Definition of market segmentation:
According to Philip kotler “Dividing a market into distinct groups of buyer who have
distinct needs, characteristics, or behavior and who might require separate product or
marketing mixes”.
RNS FIRST GRADE COLLEGE Page 15
6. Promotion
Promotions include personal selling, sales promotion and advertising. Right promotion
mix is crucial in accomplishment of marketing goals.
7. Consumer satisfaction
The product or service offered must satisfy consumer. Consumer satisfaction is the major
objective of marketing.
Market segmentation
Meaning of market segmentation:
Market segmentation is the process of dividing an entire market up into different
customer segments. Target marketing then entails deciding which potential customer
segments the company will focus on market segmentation.
Market segmentation is the marketing term referring to the aggregating of prospective
buyers into groups, or segment that have common needs and respond similarly to a
marketing action.
Definition of market segmentation:
According to Philip kotler “Dividing a market into distinct groups of buyer who have
distinct needs, characteristics, or behavior and who might require separate product or
marketing mixes”.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 16
BASIS OF SEGMENTING
Bases of segmentation & its
components
Description
Demographic segmentation
Age
Gender
Family life cycle
Income and social class
Education
Demography refers to measure of observable aspects of a
population, including size, age, gender, ethnic group, income,
education, occupation, and family structure.
0-5, 6-10, 12-17, 18-25, 25-32, 32-40, 40-48, 48-55, 55-65
0-5, 6-10, 12-17, 18-25, 25-32, 32-40, 40-48, 48-55, 55-65
Male, female and Transgender
Single, married, widowed, divorced, married no children
Poor, lower middle class, upper middle class, affluent class
High school, under graduate, Graduate, post graduate,
Doctorate
Behavioral segmentation
Expectations
Usage of product
Price sensitivity
Occasion of use
Attitude
Behavioral refers a set of actions and mannerisms made by
human beings in their environment.
Quality, quantity, looks, performance, durability, warranty
Party wear, daily wear, one time use, rough use
Cheap and best, economical, status conscious, value
conscious, prestige,
Anniversaries, holidays, emergency, graduation, funeral
Pessimist, optimist
RNS FIRST GRADE COLLEGE Page 16
BASIS OF SEGMENTING
Bases of segmentation & its
components
Description
Demographic segmentation
Age
Gender
Family life cycle
Income and social class
Education
Demography refers to measure of observable aspects of a
population, including size, age, gender, ethnic group, income,
education, occupation, and family structure.
0-5, 6-10, 12-17, 18-25, 25-32, 32-40, 40-48, 48-55, 55-65
0-5, 6-10, 12-17, 18-25, 25-32, 32-40, 40-48, 48-55, 55-65
Male, female and Transgender
Single, married, widowed, divorced, married no children
Poor, lower middle class, upper middle class, affluent class
High school, under graduate, Graduate, post graduate,
Doctorate
Behavioral segmentation
Expectations
Usage of product
Price sensitivity
Occasion of use
Attitude
Behavioral refers a set of actions and mannerisms made by
human beings in their environment.
Quality, quantity, looks, performance, durability, warranty
Party wear, daily wear, one time use, rough use
Cheap and best, economical, status conscious, value
conscious, prestige,
Anniversaries, holidays, emergency, graduation, funeral
Pessimist, optimist
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 17
Psychographic segmentation
Personality
Lifestyle
Need motivation
Perception
Learning involvement
Psychographics studies and classifies people in terms of
psychological and behavioral similarities.
Passive, Aggressive, Assertive, passive aggressive
Outdoor enthusiast, sports-minded, home body, family-
centered
Shelter, safety, securities, affection, safety, status, relaxation
Risk averse, risk neutral, risk taker
Low-investment, high investment
Geographic segmentation
Regional
City size
Density of area
Climate
Geography deals with places, physical features and the
inhabitants.
South India, north east India, North India, west India
Towns, villages, metro cities, cosmopolitan
Sub-urban, Rural, Urban, Exurban
Rainy, humid, cold temperate
Criteria for successful segmentation
1. Identifiable and measurable
The information collected by the firm for segmentation variables such as size, purchasing
power, and characteristics of the segments. Most importantly the characteristics of the
segments member must be easily identifiable and measurable.
2. Substantial
After identifying and measuring the selected segment the next important parameter is to
ensure that the selected segment is substantial, the market segment selected should be
large enough, in terms of sales and profitability.
RNS FIRST GRADE COLLEGE Page 17
Psychographic segmentation
Personality
Lifestyle
Need motivation
Perception
Learning involvement
Psychographics studies and classifies people in terms of
psychological and behavioral similarities.
Passive, Aggressive, Assertive, passive aggressive
Outdoor enthusiast, sports-minded, home body, family-
centered
Shelter, safety, securities, affection, safety, status, relaxation
Risk averse, risk neutral, risk taker
Low-investment, high investment
Geographic segmentation
Regional
City size
Density of area
Climate
Geography deals with places, physical features and the
inhabitants.
South India, north east India, North India, west India
Towns, villages, metro cities, cosmopolitan
Sub-urban, Rural, Urban, Exurban
Rainy, humid, cold temperate
Criteria for successful segmentation
1. Identifiable and measurable
The information collected by the firm for segmentation variables such as size, purchasing
power, and characteristics of the segments. Most importantly the characteristics of the
segments member must be easily identifiable and measurable.
2. Substantial
After identifying and measuring the selected segment the next important parameter is to
ensure that the selected segment is substantial, the market segment selected should be
large enough, in terms of sales and profitability.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 18
3. Accessible
The segments to select must be effective in term reach, communication, distribution and
servable.
4. Responsive
The major challenge in selecting a segmentation type is that the selected segments should
have all resources to cater for the needs of the target customers. The segments should
respond better to a distinct marketing mix, rather than a general offering.
5. Viable and sustainable
It is important for a segment to be more practical and viable, if the segment is narrow in
terms of reach then potential for sales growth will be limited and if it is too wide then it
become difficult to develop marketing plans to suit all of the groups included in the
segments.
6. Customer price sensitivity
Customer price sensitivity indicates the awareness and response of the customer to
pricing of products or services at the time of making purchasing decisions
7. Potential for substitution
The success of segmentation strategy also depends on the substitutions already prevailing
or that may develop in future, before developing a segment marketer should ensure that
the desired segment is innovative and forecast about possibility of product substitution in
future.
8. Stage of industry life cycle
Understanding the industry life cycle is very import before deciding a segment for a
simple reason that the early stages of industry life cycle competition is very minimal and
RNS FIRST GRADE COLLEGE Page 18
3. Accessible
The segments to select must be effective in term reach, communication, distribution and
servable.
4. Responsive
The major challenge in selecting a segmentation type is that the selected segments should
have all resources to cater for the needs of the target customers. The segments should
respond better to a distinct marketing mix, rather than a general offering.
5. Viable and sustainable
It is important for a segment to be more practical and viable, if the segment is narrow in
terms of reach then potential for sales growth will be limited and if it is too wide then it
become difficult to develop marketing plans to suit all of the groups included in the
segments.
6. Customer price sensitivity
Customer price sensitivity indicates the awareness and response of the customer to
pricing of products or services at the time of making purchasing decisions
7. Potential for substitution
The success of segmentation strategy also depends on the substitutions already prevailing
or that may develop in future, before developing a segment marketer should ensure that
the desired segment is innovative and forecast about possibility of product substitution in
future.
8. Stage of industry life cycle
Understanding the industry life cycle is very import before deciding a segment for a
simple reason that the early stages of industry life cycle competition is very minimal and
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 19
there is a high scope for growth in future, better opportunities can be created using
available technology for substantial profitable investment of recourses.
OBJECTIVES OF SEGMENTATION
1. Precise satisfaction of customer needs
In a common market needs and expectations of customers differ and it is important for
marketing firm to have a comprehensive understanding of customer requirements,
therefore by developing a distinct marketing mix for each segment of customers a
marketers can offer better solution for customer needs
2. Increased profits
By following an effective segmentation strategy a marketing firm can respond more
effectively to the wants of potential buyers by meeting their needs through better
positioning of chosen segments, this also allows marketing firm to gain the best price it
can in every segment, effectively raising the average price resulting in increased sales
volume and higher profits.
3. Effective allocation of resources
Proper market segmentation result in effective allocation of resources, with help of target
marketing communication in the form of promotions and advertisement customers will be
able to identify products and brand quickly as they are focused in meeting specific needs
of customers.
4. Retain customers
Meeting customer needs by delivering products or services per their requirements
through segmentation facilities a marketing firm to retain customer loyalty as their needs
change.
RNS FIRST GRADE COLLEGE Page 19
there is a high scope for growth in future, better opportunities can be created using
available technology for substantial profitable investment of recourses.
OBJECTIVES OF SEGMENTATION
1. Precise satisfaction of customer needs
In a common market needs and expectations of customers differ and it is important for
marketing firm to have a comprehensive understanding of customer requirements,
therefore by developing a distinct marketing mix for each segment of customers a
marketers can offer better solution for customer needs
2. Increased profits
By following an effective segmentation strategy a marketing firm can respond more
effectively to the wants of potential buyers by meeting their needs through better
positioning of chosen segments, this also allows marketing firm to gain the best price it
can in every segment, effectively raising the average price resulting in increased sales
volume and higher profits.
3. Effective allocation of resources
Proper market segmentation result in effective allocation of resources, with help of target
marketing communication in the form of promotions and advertisement customers will be
able to identify products and brand quickly as they are focused in meeting specific needs
of customers.
4. Retain customers
Meeting customer needs by delivering products or services per their requirements
through segmentation facilities a marketing firm to retain customer loyalty as their needs
change.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 20
5. Segment leadership
Strong market leadership is very necessary to attain maximum profitability; through
market leadership in a segment marketer can achieve economies of scale, in marketing,
productions and have established access to distribution channels.
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5. Segment leadership
Strong market leadership is very necessary to attain maximum profitability; through
market leadership in a segment marketer can achieve economies of scale, in marketing,
productions and have established access to distribution channels.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 21
CHAPTER – 2
RESEARCH DESIGN
2.1 TITLE OF THE STUDY
“A study on effectiveness of market segmentation towards HERO motors corp
With Special reference to provident motors”.
Introduction
Customer segmentation is the practice of dividing a company’s customer in to group
relevant to business.
Customer segmentation as the potential to address each customer in the most effective
way using large amount of data available on customers.
2.2 STATEMENT OF THE PROBLEM
A customer segmentation analysis allows marketer to identify discrete group of customer
with a high degree of accuracy based on demographic, behavioral and other indicators.
Customer segmentation will focus on long customer life value.
The goal of segmenting customer is to decide how to realize customer in each
segmentation in order to maximize the value each customer to the business.
RNS FIRST GRADE COLLEGE Page 21
CHAPTER – 2
RESEARCH DESIGN
2.1 TITLE OF THE STUDY
“A study on effectiveness of market segmentation towards HERO motors corp
With Special reference to provident motors”.
Introduction
Customer segmentation is the practice of dividing a company’s customer in to group
relevant to business.
Customer segmentation as the potential to address each customer in the most effective
way using large amount of data available on customers.
2.2 STATEMENT OF THE PROBLEM
A customer segmentation analysis allows marketer to identify discrete group of customer
with a high degree of accuracy based on demographic, behavioral and other indicators.
Customer segmentation will focus on long customer life value.
The goal of segmenting customer is to decide how to realize customer in each
segmentation in order to maximize the value each customer to the business.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 22
2.3 OBJECTIVES OF THE STUDY
To identify strategic management goals and breaking down mass market in to
segmentation in order to maximize the value each customer to business.
The study is limited only to RR Nagar Provident Motors.
To understand difference among general targeting strategies.
To become familiar with major segmentation variables.
To understand how to evaluate market segment.
2.4 LIMITATION
Study of segmentation is not possible as whole and in-depth.
A study is based on approximate facts and not exact facts.
The project is limited due to time constraints.
The study is based on responses of the company’s customer.
The study is limited to RR Nagar jurisdiction.
2.5 METHODOLOGY
Methodology is the systematic, theoretical analysis of the methods applied to a field of
study. It comprises the theoretical analysis of the body of methods and principles
associated with a branch of knowledge. Typically, it encompasses concepts such as
paradigm, theoretical model, phases and quantitative techniques.
A methodology does not set out provide solutions – it is, therefore, not the same thing as
a method. Instead, it offers the theoretical underpinning for understanding which method.
Set of methods or so called “best practices” can be applied to specific case, for example,
to calculate a specific result.
It has been defined also as follows:
RNS FIRST GRADE COLLEGE Page 22
2.3 OBJECTIVES OF THE STUDY
To identify strategic management goals and breaking down mass market in to
segmentation in order to maximize the value each customer to business.
The study is limited only to RR Nagar Provident Motors.
To understand difference among general targeting strategies.
To become familiar with major segmentation variables.
To understand how to evaluate market segment.
2.4 LIMITATION
Study of segmentation is not possible as whole and in-depth.
A study is based on approximate facts and not exact facts.
The project is limited due to time constraints.
The study is based on responses of the company’s customer.
The study is limited to RR Nagar jurisdiction.
2.5 METHODOLOGY
Methodology is the systematic, theoretical analysis of the methods applied to a field of
study. It comprises the theoretical analysis of the body of methods and principles
associated with a branch of knowledge. Typically, it encompasses concepts such as
paradigm, theoretical model, phases and quantitative techniques.
A methodology does not set out provide solutions – it is, therefore, not the same thing as
a method. Instead, it offers the theoretical underpinning for understanding which method.
Set of methods or so called “best practices” can be applied to specific case, for example,
to calculate a specific result.
It has been defined also as follows:
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 23
1. “the analysis of the principles of methods, rules, and postulates employed by a
discipline”
2. “the systematic study of methods that are, can be, or have been applied with in a
discipline”
3. “the study or description of methods”
2.6 RESEARCH PROCESS
Before embarking on the details of research methodology and techniques, it seems
appropriate to present a brief overview of the research process. Research process consists
of series of actions or steps necessary to effectively carry out research and the desired
sequencing of this step.
1. Formulating the research problem
2. Extensive literature survey
3. Development of working hypothesis
4. Preparing the research design
5. Determining the research design
The research was carried out as per steps of customer research process. The figure
below depicts a model of consumer research process.
RNS FIRST GRADE COLLEGE Page 23
1. “the analysis of the principles of methods, rules, and postulates employed by a
discipline”
2. “the systematic study of methods that are, can be, or have been applied with in a
discipline”
3. “the study or description of methods”
2.6 RESEARCH PROCESS
Before embarking on the details of research methodology and techniques, it seems
appropriate to present a brief overview of the research process. Research process consists
of series of actions or steps necessary to effectively carry out research and the desired
sequencing of this step.
1. Formulating the research problem
2. Extensive literature survey
3. Development of working hypothesis
4. Preparing the research design
5. Determining the research design
The research was carried out as per steps of customer research process. The figure
below depicts a model of consumer research process.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 24
2.7 SOURCES OF DATA
The task of collecting data being after a research problem has been defined and plan is
chalked out. This study pertains to collection of data from primary and secondary
sources.
Primary Data
Data are collected for the first time for a specific purpose, has been collected directly
from the sample respondents through descriptive research method. Questionnaire through
personal contact i.e., by interview.
Secondary data
Secondary data has been collected from already published standard books, newspaper,
magazines and internet portal referred by the company sales guide.
Define the objectives of the research
Collecting and evaluating secoundary data
Designing a primary research study
collecting of primary data
processing and interpretation of data
RNS FIRST GRADE COLLEGE Page 24
2.7 SOURCES OF DATA
The task of collecting data being after a research problem has been defined and plan is
chalked out. This study pertains to collection of data from primary and secondary
sources.
Primary Data
Data are collected for the first time for a specific purpose, has been collected directly
from the sample respondents through descriptive research method. Questionnaire through
personal contact i.e., by interview.
Secondary data
Secondary data has been collected from already published standard books, newspaper,
magazines and internet portal referred by the company sales guide.
Define the objectives of the research
Collecting and evaluating secoundary data
Designing a primary research study
collecting of primary data
processing and interpretation of data
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 25
Research instrument
Closed-ended Questionnaires is used as instrument for this research study and the set of
the sample is restricted to 100 samples.
2.8 DESCRIPTIVE RESEARCH DESIGN
Descriptive research design includes survey and fact findings, enquires of different kinds.
The major purpose of descriptive research is description of state of affairs, as it exists at
present. In social business research, we quiet often use the term Ex post facto research for
descriptive studies.
The main characteristic of this method is that the researcher has no control over the
variable; he can only report what is happened or what is happening. Most Ex post facto
research projects are used for descriptive studies in which the researcher seeks to measure
such items, for example, frequency of shopping, and customer preferences on products or
services.
Descriptive research method will be applicable to the existing problem. Here the study is
conducted for a fact i.e, to know the “Effectiveness of market segmentation towards Hero
Moto cop”. So, the process was conducted through questionnaire.
Required information
o Demographic profiles of the respondents
o Information on factors influencing respondents while choosing a brand.
o On which brand the respondents are interested in and the reason why they are stick
on to the brand. Whether they will switch over to other brands.
RNS FIRST GRADE COLLEGE Page 25
Research instrument
Closed-ended Questionnaires is used as instrument for this research study and the set of
the sample is restricted to 100 samples.
2.8 DESCRIPTIVE RESEARCH DESIGN
Descriptive research design includes survey and fact findings, enquires of different kinds.
The major purpose of descriptive research is description of state of affairs, as it exists at
present. In social business research, we quiet often use the term Ex post facto research for
descriptive studies.
The main characteristic of this method is that the researcher has no control over the
variable; he can only report what is happened or what is happening. Most Ex post facto
research projects are used for descriptive studies in which the researcher seeks to measure
such items, for example, frequency of shopping, and customer preferences on products or
services.
Descriptive research method will be applicable to the existing problem. Here the study is
conducted for a fact i.e, to know the “Effectiveness of market segmentation towards Hero
Moto cop”. So, the process was conducted through questionnaire.
Required information
o Demographic profiles of the respondents
o Information on factors influencing respondents while choosing a brand.
o On which brand the respondents are interested in and the reason why they are stick
on to the brand. Whether they will switch over to other brands.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 26
2.9 RESEARCH INSTRUMENT DESIGN
QUESTIONNAIRE
This method of data collected is quite popular particularly in case of big enquiries.
Private individuals are adopting it. Research workers, private and public organizations
and even by government. In this method, a questionnaire is sent to the persons concerned
with the request to answer the questions and return the questionnaire. A questionnaire
consists of number of questions printed or typed in a definite order on a form.
The researcher has used questionnaire for the following purposes:
For identify the demographic profile of the respondents.
To study the interest and satisfaction level towards the varies attributes of Hero bikes
compared to other cars.
To identify the customers option towards the advertisement of Hero Bikes and
identifying the general satisfaction level on Hero Bikes.
SAMPLING UNIT
Sampling unit deals with persons to be surveyed. The researcher must define the target
population. Among the motor bike user’s customers of Hero in Bangalore is the sample
population for the study. Based on random sampling grouped based on geographical area.
SAMPLE SIZE
Once the sampling sized was determined, the sampling size was fixed to 100 consumers.
RNS FIRST GRADE COLLEGE Page 26
2.9 RESEARCH INSTRUMENT DESIGN
QUESTIONNAIRE
This method of data collected is quite popular particularly in case of big enquiries.
Private individuals are adopting it. Research workers, private and public organizations
and even by government. In this method, a questionnaire is sent to the persons concerned
with the request to answer the questions and return the questionnaire. A questionnaire
consists of number of questions printed or typed in a definite order on a form.
The researcher has used questionnaire for the following purposes:
For identify the demographic profile of the respondents.
To study the interest and satisfaction level towards the varies attributes of Hero bikes
compared to other cars.
To identify the customers option towards the advertisement of Hero Bikes and
identifying the general satisfaction level on Hero Bikes.
SAMPLING UNIT
Sampling unit deals with persons to be surveyed. The researcher must define the target
population. Among the motor bike user’s customers of Hero in Bangalore is the sample
population for the study. Based on random sampling grouped based on geographical area.
SAMPLE SIZE
Once the sampling sized was determined, the sampling size was fixed to 100 consumers.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 27
CHAPTER 3
COMPANY PROFILE
INTODUCTION
“HERO” is the brand name used by the Munjal brothers for their for their flagship
company Hero cycles Ltd. A joint venture between the Hero group and Honda Motor
Company was established in 1984 as the Hero Honda motors limited at Dharuhera India.
Munjal family and Honda group both own 26% stake in the company. In 2010, it was
reported that Honda planned to sell its stake in the venture to the Munjal family.
During the 1980s, the company introduced motorcycles that were popular in India for
their fuel economy and low cost. A popular advertising campaign based on the slogan
‘Fill it – shut it’ that emphasized the motorcycle’s fuel efficiency helped the company
grow at a double-digit pace since inception. The technology in the bikes of Hero Honda
for almost 26 years (1984-2010) has come from the Japanese counterpart Honda.
Hero motoCorp has three manufacturing facilities based at Dharuhera, Gurgaon in
Haryana and at Haridwar in Uttarakhand. These plants together can churn out 3 million
bikes per year. Hero motoCorp has a large sales and service network with over 3,000
dealership and service points across India. Hero Honda has a customer loyalty program
since 2000, called the Hero Honda passport program.
The company has a started aim of achieving revenues of $10 billion and volumes of 10
million tow-wheelers by 2016-17. This in conjunction with new countries where they can
now market their two-wheelers following the disengagement from Honda, Hero
motocorp hopes to achieve 10 percent of their revenues from international markets, and
they expected to launch sales in Nigeria by end-2011 or early-2012. In addition, to cope
with the new demand over the coming half decade, the company was going to build their
RNS FIRST GRADE COLLEGE Page 27
CHAPTER 3
COMPANY PROFILE
INTODUCTION
“HERO” is the brand name used by the Munjal brothers for their for their flagship
company Hero cycles Ltd. A joint venture between the Hero group and Honda Motor
Company was established in 1984 as the Hero Honda motors limited at Dharuhera India.
Munjal family and Honda group both own 26% stake in the company. In 2010, it was
reported that Honda planned to sell its stake in the venture to the Munjal family.
During the 1980s, the company introduced motorcycles that were popular in India for
their fuel economy and low cost. A popular advertising campaign based on the slogan
‘Fill it – shut it’ that emphasized the motorcycle’s fuel efficiency helped the company
grow at a double-digit pace since inception. The technology in the bikes of Hero Honda
for almost 26 years (1984-2010) has come from the Japanese counterpart Honda.
Hero motoCorp has three manufacturing facilities based at Dharuhera, Gurgaon in
Haryana and at Haridwar in Uttarakhand. These plants together can churn out 3 million
bikes per year. Hero motoCorp has a large sales and service network with over 3,000
dealership and service points across India. Hero Honda has a customer loyalty program
since 2000, called the Hero Honda passport program.
The company has a started aim of achieving revenues of $10 billion and volumes of 10
million tow-wheelers by 2016-17. This in conjunction with new countries where they can
now market their two-wheelers following the disengagement from Honda, Hero
motocorp hopes to achieve 10 percent of their revenues from international markets, and
they expected to launch sales in Nigeria by end-2011 or early-2012. In addition, to cope
with the new demand over the coming half decade, the company was going to build their
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 28
fourth factory in fourth in south India and their fifth factory in western India. There is no
conformation where the factories would be built.
Hero Honda became the first company in the country to introduce four-stroke
motorcycles and set the standards for fuel efficiency, pollution control and quality. It has
an excellent distribution and service network spread throughout the country.
Hero Honda bikes currently roll out from its three globally benchmarked manufacturing
facilities. Tow of this are based at Dharuhera and Gurgaon in Haryana and the third state
of the art manufacturing facility was inaugurated at Haridwar, uttarkhand in April this
year. These plants together can produce out 4.4 million units per year.
Having reached an unassailable pole position in the Indian tow-wheeler market, Hero
Honda is constantly working towards consolidating its position in the market place. The
company believes that changing demographic profile of India, increasing urbanization
and the empowerment of rural India will add millions of new families to the economic
mainstream. This would provide the growth ballast that would sustain Hero Honda in the
year to come. As BrijmohanLallMunjal, the chairman, Hero Honda motors succinctly
points out, ‘we pioneered India’s motorcycle industry to the next level. We’ll do all it
takes to reach there”.
3.1 HISTORY
Hero Honda started its business operations in 1984 as a joint venture between hero cycles
(sometimes called Hero groups, not to be confused with the Hero group food company of
Switzerland) of India and Honda of Japan. In 2010, when Honda decided to move out of
the joint venture, hero group brought the shares held by Honda. Subsequently, in august
2011 the company was renamed Hero MotoCorp with a new corporate identity.
In June 2012, Hero MotoCorp approved aproposal to merge the investment arm of its
parent Hero investment Pvt. Ltd. With the automaker. This decision came 18 months
after its split from Hero Honda.
RNS FIRST GRADE COLLEGE Page 28
fourth factory in fourth in south India and their fifth factory in western India. There is no
conformation where the factories would be built.
Hero Honda became the first company in the country to introduce four-stroke
motorcycles and set the standards for fuel efficiency, pollution control and quality. It has
an excellent distribution and service network spread throughout the country.
Hero Honda bikes currently roll out from its three globally benchmarked manufacturing
facilities. Tow of this are based at Dharuhera and Gurgaon in Haryana and the third state
of the art manufacturing facility was inaugurated at Haridwar, uttarkhand in April this
year. These plants together can produce out 4.4 million units per year.
Having reached an unassailable pole position in the Indian tow-wheeler market, Hero
Honda is constantly working towards consolidating its position in the market place. The
company believes that changing demographic profile of India, increasing urbanization
and the empowerment of rural India will add millions of new families to the economic
mainstream. This would provide the growth ballast that would sustain Hero Honda in the
year to come. As BrijmohanLallMunjal, the chairman, Hero Honda motors succinctly
points out, ‘we pioneered India’s motorcycle industry to the next level. We’ll do all it
takes to reach there”.
3.1 HISTORY
Hero Honda started its business operations in 1984 as a joint venture between hero cycles
(sometimes called Hero groups, not to be confused with the Hero group food company of
Switzerland) of India and Honda of Japan. In 2010, when Honda decided to move out of
the joint venture, hero group brought the shares held by Honda. Subsequently, in august
2011 the company was renamed Hero MotoCorp with a new corporate identity.
In June 2012, Hero MotoCorp approved aproposal to merge the investment arm of its
parent Hero investment Pvt. Ltd. With the automaker. This decision came 18 months
after its split from Hero Honda.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 29
“Hero” is the brand name used by the munjal brothers for their flagship company, Hero
cycles Ltd. A joint venture between the Hero Group and Honda motor company was
established in 1984 as the Hero Honda motors limited at Dharuhera, India. Munjal family
and Honda group both owned 26% stake in the company.
During the 1980’s the company introduced motorcycles that were popular in India for
their fuel economy and low cost. A popular advertising campaign based on the slogan
‘fill it – shut it – forget it’ that emphasized the motorcycle’s fuel efficiency helped the
company grow at a double-digit pace since inception. In 2001, the company became the
largest tow-wheeler manufacturing company in India and globally. It maintains global
industry leadership to date. The technology in the bikes of Hero MotoCorp (earlier Hero
Honda) for almost 26 years (1984-2010) has come from the Japanese counterpart Honda.
The success of the Hero Group lies in the determination and foresight of the Munjal
brothers, who shared their vision with their workers and led the group to a position where
its name has become synonymous with top-quality tow wheelers. The flame kindled by
the Munjal brothers in 1956 with the flagship company Hero cycles; Mr.
satyanandMunjal, Mr. BrijmohanlallMunjal and Mr. O.P. Munjal continue to carry the
torch and are actively involved in the day-to-day operations of the Hero Group. The Hero
group is a thriving example of three generations if the family working and striving
together to ensure quality, satisfaction and extensive growth.
Company time line – Hero MotoCorp
1956 - Formations of Hero cycles in Ludhiana (Majestic auto limited)
1975 – Hero cycles become largest bicycles manufacturer in India.
1983 – Collaboration agreement with Honda Motor Co. Ltd. Japan signed shareholder
agreement signed.
1984 – Hero Honda motors Ltd. Incorporated.
1985 – Hero Honda Motorcycle CD 100 launched.
1989 – Hero Honda Motorcycle sleek launched.
RNS FIRST GRADE COLLEGE Page 29
“Hero” is the brand name used by the munjal brothers for their flagship company, Hero
cycles Ltd. A joint venture between the Hero Group and Honda motor company was
established in 1984 as the Hero Honda motors limited at Dharuhera, India. Munjal family
and Honda group both owned 26% stake in the company.
During the 1980’s the company introduced motorcycles that were popular in India for
their fuel economy and low cost. A popular advertising campaign based on the slogan
‘fill it – shut it – forget it’ that emphasized the motorcycle’s fuel efficiency helped the
company grow at a double-digit pace since inception. In 2001, the company became the
largest tow-wheeler manufacturing company in India and globally. It maintains global
industry leadership to date. The technology in the bikes of Hero MotoCorp (earlier Hero
Honda) for almost 26 years (1984-2010) has come from the Japanese counterpart Honda.
The success of the Hero Group lies in the determination and foresight of the Munjal
brothers, who shared their vision with their workers and led the group to a position where
its name has become synonymous with top-quality tow wheelers. The flame kindled by
the Munjal brothers in 1956 with the flagship company Hero cycles; Mr.
satyanandMunjal, Mr. BrijmohanlallMunjal and Mr. O.P. Munjal continue to carry the
torch and are actively involved in the day-to-day operations of the Hero Group. The Hero
group is a thriving example of three generations if the family working and striving
together to ensure quality, satisfaction and extensive growth.
Company time line – Hero MotoCorp
1956 - Formations of Hero cycles in Ludhiana (Majestic auto limited)
1975 – Hero cycles become largest bicycles manufacturer in India.
1983 – Collaboration agreement with Honda Motor Co. Ltd. Japan signed shareholder
agreement signed.
1984 – Hero Honda motors Ltd. Incorporated.
1985 – Hero Honda Motorcycle CD 100 launched.
1989 – Hero Honda Motorcycle sleek launched.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 30
1991 – Hero Honda Motorcycle CD 100 SS launched.
1994 – Hero Honda Motorcycle splendor launched.
1997 Hero Honda Motorcycle Street launched.
1999 – Hero Honda Motorcycle CBZ launched.
2001 – Hero Honda Motorcycle passion and Hero Honda joy launched.
2002 – Hero Honda Motorcycle Dawn and Hero Honda Motorcycle Ambition
launched.
2003 – Hero Honda Motorcycle CD Dawn, Hero Honda Motorcycle splendor plus,
Hero Honda Motorcycle Passion Plus and Hero Honda Motorcycle Karizma
launched.
2004 – Hero Honda Motorcycle Ambition 135 and Hero Honda motorcycle CBZ
launched.
2005 – Hero motorcorp super splendor, Hero Honda motorcycle Deluxe, Hero Honda
motorcycle Glamour, Hero Honda achiever and hero Honda scooter pleasure.
2007 – New Models of Hero Honda motorcycle splendor NXG, New Models of Hero
Honda motorcycle CD Deluxe, New Models of Hero Honda motorcycles passion Plus
and Hero Honda motorcycle Hunk launched.
2008 – New models of Hero Honda motorcycles pleasure, CBZ Xtreme, Glamour,
Glamour Fi and Hero Honda motorcycle passion pro launched.
2009 – New Models of Hero Honda motorcycle Karizma:Karizma – ZMR and limited
edition of Hero Honda motorcycle Hunk launched.
2010 – New models of Hero Honda motorcycle splendor pro and New Hero Honda
motorcycle Hunk and New Hero Honda motorcycle super splendor launched.
2011 – New models of Hero Honda motorcycles Glamour, Glamour FI, CBZ Xtreme,
Karizma launched. New licensing agreement signed between Hero Honda. N August
Hero and Honda parted company, thus forming Hero Motocorp and Honda moving
out of the Hero Honda joint venture. In November, Hero launched its first ever off
road Bike Named Hero “Impulse”.
RNS FIRST GRADE COLLEGE Page 30
1991 – Hero Honda Motorcycle CD 100 SS launched.
1994 – Hero Honda Motorcycle splendor launched.
1997 Hero Honda Motorcycle Street launched.
1999 – Hero Honda Motorcycle CBZ launched.
2001 – Hero Honda Motorcycle passion and Hero Honda joy launched.
2002 – Hero Honda Motorcycle Dawn and Hero Honda Motorcycle Ambition
launched.
2003 – Hero Honda Motorcycle CD Dawn, Hero Honda Motorcycle splendor plus,
Hero Honda Motorcycle Passion Plus and Hero Honda Motorcycle Karizma
launched.
2004 – Hero Honda Motorcycle Ambition 135 and Hero Honda motorcycle CBZ
launched.
2005 – Hero motorcorp super splendor, Hero Honda motorcycle Deluxe, Hero Honda
motorcycle Glamour, Hero Honda achiever and hero Honda scooter pleasure.
2007 – New Models of Hero Honda motorcycle splendor NXG, New Models of Hero
Honda motorcycle CD Deluxe, New Models of Hero Honda motorcycles passion Plus
and Hero Honda motorcycle Hunk launched.
2008 – New models of Hero Honda motorcycles pleasure, CBZ Xtreme, Glamour,
Glamour Fi and Hero Honda motorcycle passion pro launched.
2009 – New Models of Hero Honda motorcycle Karizma:Karizma – ZMR and limited
edition of Hero Honda motorcycle Hunk launched.
2010 – New models of Hero Honda motorcycle splendor pro and New Hero Honda
motorcycle Hunk and New Hero Honda motorcycle super splendor launched.
2011 – New models of Hero Honda motorcycles Glamour, Glamour FI, CBZ Xtreme,
Karizma launched. New licensing agreement signed between Hero Honda. N August
Hero and Honda parted company, thus forming Hero Motocorp and Honda moving
out of the Hero Honda joint venture. In November, Hero launched its first ever off
road Bike Named Hero “Impulse”.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 31
2012 – New Models of Hero motocorp Maestro the Musculine scooter and Ignitor the
Young generation bike are launched.
2013 – Hero motocorp unveiled line-up of 15 updated products including Karizma R,
ZMR, Xtreme, Pleasure, splendor Pro, splendor ismart, HF Deluxe ECO, Hero
Motocorp Super Splendor, passion pro and Xpro, Glamour and Glamour FI etc.
2016 – Hero Duet motorcycle launched, Hero splendor pro motorcycle launched.
CHALLENGES FOR THE INDUSTRY
Several factors including high inflation, firm interest rates, rising petrol prices, besides
weak monsoons have been dampening demand in the domestic market over last several
quarters.
At the same time, overseas sales have been adversely impacted by increase in interest
rates in several target countries, increase in import duty in sri Lanka, trade restrictions
imposed by Argentina and dollar sales embargo with Iran. This apart, the reduction in
incentives available to two-wheeler exporters, twice over the last 18 months, has
persuaded Indian original equipment manufacturers (OEMs) to partially hike product
prices in overseas markets, adding to the pressure on export volumes.
Product range of the company includes:
CD Drawn
CD Deluxe
Pleasure
Splendor NXG
Splendor +
Passion PRO
Passion Plus
Super splendor
Glamour
Glamour PGM FI
RNS FIRST GRADE COLLEGE Page 31
2012 – New Models of Hero motocorp Maestro the Musculine scooter and Ignitor the
Young generation bike are launched.
2013 – Hero motocorp unveiled line-up of 15 updated products including Karizma R,
ZMR, Xtreme, Pleasure, splendor Pro, splendor ismart, HF Deluxe ECO, Hero
Motocorp Super Splendor, passion pro and Xpro, Glamour and Glamour FI etc.
2016 – Hero Duet motorcycle launched, Hero splendor pro motorcycle launched.
CHALLENGES FOR THE INDUSTRY
Several factors including high inflation, firm interest rates, rising petrol prices, besides
weak monsoons have been dampening demand in the domestic market over last several
quarters.
At the same time, overseas sales have been adversely impacted by increase in interest
rates in several target countries, increase in import duty in sri Lanka, trade restrictions
imposed by Argentina and dollar sales embargo with Iran. This apart, the reduction in
incentives available to two-wheeler exporters, twice over the last 18 months, has
persuaded Indian original equipment manufacturers (OEMs) to partially hike product
prices in overseas markets, adding to the pressure on export volumes.
Product range of the company includes:
CD Drawn
CD Deluxe
Pleasure
Splendor NXG
Splendor +
Passion PRO
Passion Plus
Super splendor
Glamour
Glamour PGM FI
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 32
Achiever
CBZ Extreme
Hunk
Karizma
Duet
Splendor pro
Hero Maestro
GROWTH OF INDUSTRY
The report highlights that based on calendar year 2012 volumes, however, India is now
the largest tow-wheeler market in the world, with sales volumes of 13.8 million units
(domestic). It has overtaken china at 12.6 million units. In fact, while tow wheeler sales
volumes in India grew by 5.8 percent during 2012 calendar year over the previous year,
the domestic demand both in china and Indonesia second and third largest tow-wheeler
markets, respectively) shrunk by 10.0 percent and 9.2 percent, respectively.
Several industry participants have announced green field capacity expansion plans in
recent periods. Hero Motocorp plans to invest Rs 1500 cr over the next tow year towards
establishing facilities in Rajasthan and Gujarat; Hondais in the process of setting-up its
third manufacturing facilities in Karnataka; Yamaha too is setting-up a new plant in
Tamil Nadu at an investment of Rs 1500 cr together, these three OEMs will add 4 million
units of additional tow-wheeler capacity over the next two years, representing 22 percent
addition on existing industry capacity.
ICRA expects these large investments to exert pressure on the industry’s profitability
metrics over the near term as volume growth moderation further takes root in the absence
of immediate demand triggers.
RNS FIRST GRADE COLLEGE Page 32
Achiever
CBZ Extreme
Hunk
Karizma
Duet
Splendor pro
Hero Maestro
GROWTH OF INDUSTRY
The report highlights that based on calendar year 2012 volumes, however, India is now
the largest tow-wheeler market in the world, with sales volumes of 13.8 million units
(domestic). It has overtaken china at 12.6 million units. In fact, while tow wheeler sales
volumes in India grew by 5.8 percent during 2012 calendar year over the previous year,
the domestic demand both in china and Indonesia second and third largest tow-wheeler
markets, respectively) shrunk by 10.0 percent and 9.2 percent, respectively.
Several industry participants have announced green field capacity expansion plans in
recent periods. Hero Motocorp plans to invest Rs 1500 cr over the next tow year towards
establishing facilities in Rajasthan and Gujarat; Hondais in the process of setting-up its
third manufacturing facilities in Karnataka; Yamaha too is setting-up a new plant in
Tamil Nadu at an investment of Rs 1500 cr together, these three OEMs will add 4 million
units of additional tow-wheeler capacity over the next two years, representing 22 percent
addition on existing industry capacity.
ICRA expects these large investments to exert pressure on the industry’s profitability
metrics over the near term as volume growth moderation further takes root in the absence
of immediate demand triggers.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 33
The domestic tow-wheeler industry is expected to report moderate volume growth of
around 4-5 percent in 2012-13, as demand slowdown as well as base effect catches up
with the industry, says a recent ICRA report on the industry. The tow wheeler industry,
however, has clocked a compounded annual growth rate (CARG) of 21.8 percent over the
last three years.
The report further adds that over the medium term, the tow-wheeler industry is expected
to report a volume CAGS of 8-9 percent, to reach a size of 22-23 million units
(combining domestic and exports) by 2016-17.
“our longer-term growth forecast remains at 9-11 percent, as we believe the various
structural position associated with the domestic two-wheeler industry including favorable
demographic profile, moderate tow-wheeler penetration levels (in relation to several
other emerging markets), under developed public transport system, growing urbanization,
strong replacement demand and moderate share of financed purchases remain intact; as
also the large opportunity available to grow presence in overseas markets, mainly Africa
and Latin America,” the report says.
With domestic volume growth of 3.9 percent year-to-year and export volume dip of 1.1
percent in 11 months of 2012-13, the Indian tow-wheeler is currently amidst a slowdown
phase last experienced in 2007-08 / 2008-09.
CHALLENGES FOR THE INDUSTRY
Several factors including high inflation, firm interest rates, rising petrol prices, besides
weak monsoons have been dampening in the domestic market over last several quarters.
At the same time, overseas sales have been adversely impacted by increase in interest
rates in several target countries, increase in import duty in Sri Lanka, trade restrictions
imposed by Argentina and dollar sales embargo with Iron. This apart, the reduction in
incentives available to tow-wheeler exporters, twice over the last 18 months, has
RNS FIRST GRADE COLLEGE Page 33
The domestic tow-wheeler industry is expected to report moderate volume growth of
around 4-5 percent in 2012-13, as demand slowdown as well as base effect catches up
with the industry, says a recent ICRA report on the industry. The tow wheeler industry,
however, has clocked a compounded annual growth rate (CARG) of 21.8 percent over the
last three years.
The report further adds that over the medium term, the tow-wheeler industry is expected
to report a volume CAGS of 8-9 percent, to reach a size of 22-23 million units
(combining domestic and exports) by 2016-17.
“our longer-term growth forecast remains at 9-11 percent, as we believe the various
structural position associated with the domestic two-wheeler industry including favorable
demographic profile, moderate tow-wheeler penetration levels (in relation to several
other emerging markets), under developed public transport system, growing urbanization,
strong replacement demand and moderate share of financed purchases remain intact; as
also the large opportunity available to grow presence in overseas markets, mainly Africa
and Latin America,” the report says.
With domestic volume growth of 3.9 percent year-to-year and export volume dip of 1.1
percent in 11 months of 2012-13, the Indian tow-wheeler is currently amidst a slowdown
phase last experienced in 2007-08 / 2008-09.
CHALLENGES FOR THE INDUSTRY
Several factors including high inflation, firm interest rates, rising petrol prices, besides
weak monsoons have been dampening in the domestic market over last several quarters.
At the same time, overseas sales have been adversely impacted by increase in interest
rates in several target countries, increase in import duty in Sri Lanka, trade restrictions
imposed by Argentina and dollar sales embargo with Iron. This apart, the reduction in
incentives available to tow-wheeler exporters, twice over the last 18 months, has
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 34
persuaded Indian original equipment manufacturers to partially hike products prices in
overseas markets, adding to the pressure on export volumes.
3.2 VISION
“The Hero cycles are continuously striving for synergy between technology, system and
human resources to provide products and services that meet the quality, performance and
price aspirations of the customers. While doing so, we maintain the highest standards of
ethics and societal responsibilities, constantly innovate products and process, and develop
terms that keep the momentum going to take the group to excellence in everything we
do.”
3.3 MISSION
“Hero MotoCorp’s mission is to become a global enterprise fulfilling its customer’s need
and aspirations for mobility, setting benchmarks in technology, styling and quality so that
it converts its customers into its brands advocates. The company will provide an engaging
environment for its people to perform to their true potential. It will continue its focus on
value creation and enduring relationship with its partners”.
STRATEGY
Hero MotoCorp's key strategies are to build a robust product portfolio across categories,
explore growth opportunities globally, continuously improve its operational efficiency,
aggressively expand its reach to customers, continue to invest in brand building activities
and ensure customer and shareholder delight.
MANUFACTURING
Hero MotoCorp two wheelers are manufactured across three globally benchmarked
manufacturing facilities. Two of these are based at Gurgaon and Dharuhera which are
RNS FIRST GRADE COLLEGE Page 34
persuaded Indian original equipment manufacturers to partially hike products prices in
overseas markets, adding to the pressure on export volumes.
3.2 VISION
“The Hero cycles are continuously striving for synergy between technology, system and
human resources to provide products and services that meet the quality, performance and
price aspirations of the customers. While doing so, we maintain the highest standards of
ethics and societal responsibilities, constantly innovate products and process, and develop
terms that keep the momentum going to take the group to excellence in everything we
do.”
3.3 MISSION
“Hero MotoCorp’s mission is to become a global enterprise fulfilling its customer’s need
and aspirations for mobility, setting benchmarks in technology, styling and quality so that
it converts its customers into its brands advocates. The company will provide an engaging
environment for its people to perform to their true potential. It will continue its focus on
value creation and enduring relationship with its partners”.
STRATEGY
Hero MotoCorp's key strategies are to build a robust product portfolio across categories,
explore growth opportunities globally, continuously improve its operational efficiency,
aggressively expand its reach to customers, continue to invest in brand building activities
and ensure customer and shareholder delight.
MANUFACTURING
Hero MotoCorp two wheelers are manufactured across three globally benchmarked
manufacturing facilities. Two of these are based at Gurgaon and Dharuhera which are
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 35
located in the state of Haryana in northern India. The third and the latest manufacturing
plant are based at Haridwar, in the hill state of Uttrakhand.
TECHNOLOGY
In the 1980’s the company pioneered the introduction of fuel-efficient, environment
friendly four-stroke motorcycles in the country. It become the first company to launch the
fuel injection technology in India motorcycles, with the launch of the Glamour FI in
june2006.
Its plants use world class equipment and processes and have become a benchmark in
leanness and productivity. Hero MotoCorp, in its endeavor to remain a pioneer in
technology, will continue to innovate and develop cutting edge products and processes.
DISTRIBUTION
The Company's growth in the two-wheeler market in India is the result of an intrinsic
ability to increase reach in new geographies and growth markets. Hero MotoCorp's
extensive sales and service network now spans over to 5000 customer touch points. These
comprise a mix of authorized dealerships, service & spare parts outlets and dealer-
appointed outlets across the country.
Supply Chain Management
As the Company prepares to produce a wider range of products, efforts are being taken to
align the supply chain and prime up its supplier base. During the year, the Company kick-
started the process of migrating its existing brands to the new brand. The exercise is
expected to be completed during 2012-13.
During the year, the Company also commenced the process of working with its vendors
to develop new parts. The Company’s Supply Chain Management function is built on
three planks:
RNS FIRST GRADE COLLEGE Page 35
located in the state of Haryana in northern India. The third and the latest manufacturing
plant are based at Haridwar, in the hill state of Uttrakhand.
TECHNOLOGY
In the 1980’s the company pioneered the introduction of fuel-efficient, environment
friendly four-stroke motorcycles in the country. It become the first company to launch the
fuel injection technology in India motorcycles, with the launch of the Glamour FI in
june2006.
Its plants use world class equipment and processes and have become a benchmark in
leanness and productivity. Hero MotoCorp, in its endeavor to remain a pioneer in
technology, will continue to innovate and develop cutting edge products and processes.
DISTRIBUTION
The Company's growth in the two-wheeler market in India is the result of an intrinsic
ability to increase reach in new geographies and growth markets. Hero MotoCorp's
extensive sales and service network now spans over to 5000 customer touch points. These
comprise a mix of authorized dealerships, service & spare parts outlets and dealer-
appointed outlets across the country.
Supply Chain Management
As the Company prepares to produce a wider range of products, efforts are being taken to
align the supply chain and prime up its supplier base. During the year, the Company kick-
started the process of migrating its existing brands to the new brand. The exercise is
expected to be completed during 2012-13.
During the year, the Company also commenced the process of working with its vendors
to develop new parts. The Company’s Supply Chain Management function is built on
three planks:
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 36
Cost
Quality
Sustainability
Tracking inventory cost effectively and efficiently is known to be a key source of
competitive advantage in the automobile industry. Hence, it comes as no surprise that
cost leadership is the Company’s prime focus area. Continual pressure on margins forced
the Company and its supply chain partners to find innovative and alternate ways to
combat inflation. Considerable attention was given to managing component inventory in
the system, with double-digit growth in inventory turnover. To align HR processes with
the supply chain, top two HR consulting firms in India are working with supply chain
partners. The exercise is aimed at improving robustness of people processes and resulting
in a direct impact on quality, cost, productivity, delivery and reliability. The move will
enable supply chain partners move to the next orbit of operational excellence. The
Company initiated more than 30 quality improvement projects with supply chain partners
to provide better quality products to customers.
Termination of Honda joint venture
In December 2010, the board of directors of the Hero Honda Group
has decided to terminate the joint venture between Hero Group of India and Honda of
Japan in a phased manner. The Hero Group would buy out the 26% stake of the Honda in
JV Hero Honda. Under the joint venture, Hero Group could not export to international
markets (except Sri Lanka) and the termination would mean that Hero Group can now
export. Since the beginning, the Hero Group relied on their Japanese partner Honda for
the technology in their bikes. So, there are concerns that the Hero Group might not be
able to sustain the performance of the Joint Venture alone.
The Japanese auto major will exit the joint venture through a series of off market
transactions by giving the Munjal family—that held a 26% stake in the company—an
RNS FIRST GRADE COLLEGE Page 36
Cost
Quality
Sustainability
Tracking inventory cost effectively and efficiently is known to be a key source of
competitive advantage in the automobile industry. Hence, it comes as no surprise that
cost leadership is the Company’s prime focus area. Continual pressure on margins forced
the Company and its supply chain partners to find innovative and alternate ways to
combat inflation. Considerable attention was given to managing component inventory in
the system, with double-digit growth in inventory turnover. To align HR processes with
the supply chain, top two HR consulting firms in India are working with supply chain
partners. The exercise is aimed at improving robustness of people processes and resulting
in a direct impact on quality, cost, productivity, delivery and reliability. The move will
enable supply chain partners move to the next orbit of operational excellence. The
Company initiated more than 30 quality improvement projects with supply chain partners
to provide better quality products to customers.
Termination of Honda joint venture
In December 2010, the board of directors of the Hero Honda Group
has decided to terminate the joint venture between Hero Group of India and Honda of
Japan in a phased manner. The Hero Group would buy out the 26% stake of the Honda in
JV Hero Honda. Under the joint venture, Hero Group could not export to international
markets (except Sri Lanka) and the termination would mean that Hero Group can now
export. Since the beginning, the Hero Group relied on their Japanese partner Honda for
the technology in their bikes. So, there are concerns that the Hero Group might not be
able to sustain the performance of the Joint Venture alone.
The Japanese auto major will exit the joint venture through a series of off market
transactions by giving the Munjal family—that held a 26% stake in the company—an
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 37
additional 26%. Honda, which also has an independent fully owned two wheeler
subsidiary—Honda Motorcycle and Scooter India (HMSI)—will exit Hero Honda at a
discount and get over $1 billion for its stake. The discount will be between 30% and 50%
to the current value of Honda's stake as per the price of the stock after the market closed
on Wednesday.
The rising differences between the two partners gradually emerged as an irritant.
Differences had been brewing for a few years before the split over a variety of issues,
ranging from Honda's reluctance to fully and freely share technology with Hero (despite a
10-year technology tie-up that expires in 2014) as well as Indian partner's uneasiness over
high royalty payouts to the Japanese company. Another major irritant for Honda was the
refusal of Hero Honda (mainly managed by the Munjal family) to merge the company's
spare parts business with Honda's new fully owned subsidiary Honda Motorcycle and
Scooter India (HMSI).
As per the arrangement, it will be a two-leg deal. In the first part, the Munjal family, led
by BrijmohanLalMunjal group, will form an overseas-incorporated special purpose
vehicle (SPV) to buy out Honda's entire stake, which will be backed by bridge loans. This
SPV would eventually be thrown open for private equity participation and those in the
fray include Warburg Pincus, Kohlberg Kravis Roberts (KKR), TPG, Bain Capital,
and Carlyle Group.
Honda will continue to provide technology to Hero Honda motorbikes until 2014 for
existing as well as future models.
RNS FIRST GRADE COLLEGE Page 37
additional 26%. Honda, which also has an independent fully owned two wheeler
subsidiary—Honda Motorcycle and Scooter India (HMSI)—will exit Hero Honda at a
discount and get over $1 billion for its stake. The discount will be between 30% and 50%
to the current value of Honda's stake as per the price of the stock after the market closed
on Wednesday.
The rising differences between the two partners gradually emerged as an irritant.
Differences had been brewing for a few years before the split over a variety of issues,
ranging from Honda's reluctance to fully and freely share technology with Hero (despite a
10-year technology tie-up that expires in 2014) as well as Indian partner's uneasiness over
high royalty payouts to the Japanese company. Another major irritant for Honda was the
refusal of Hero Honda (mainly managed by the Munjal family) to merge the company's
spare parts business with Honda's new fully owned subsidiary Honda Motorcycle and
Scooter India (HMSI).
As per the arrangement, it will be a two-leg deal. In the first part, the Munjal family, led
by BrijmohanLalMunjal group, will form an overseas-incorporated special purpose
vehicle (SPV) to buy out Honda's entire stake, which will be backed by bridge loans. This
SPV would eventually be thrown open for private equity participation and those in the
fray include Warburg Pincus, Kohlberg Kravis Roberts (KKR), TPG, Bain Capital,
and Carlyle Group.
Honda will continue to provide technology to Hero Honda motorbikes until 2014 for
existing as well as future models.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 38
3.4 BOARD OF DIRECTORS
Founder Director and Chairman : Dr. BrijmohanLallMunjal
Managing Director and CEO : Mr. PawanMunjal
.
Board of Directors
Name of the person Nature of the Office
Mr. Sunil Kant Munjal Non-Executive Director
Mr. Suman Kant Munjal Director
Mr. Paul Edgerley Non-Executive Director
RNS FIRST GRADE COLLEGE Page 38
3.4 BOARD OF DIRECTORS
Founder Director and Chairman : Dr. BrijmohanLallMunjal
Managing Director and CEO : Mr. PawanMunjal
.
Board of Directors
Name of the person Nature of the Office
Mr. Sunil Kant Munjal Non-Executive Director
Mr. Suman Kant Munjal Director
Mr. Paul Edgerley Non-Executive Director
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 39
Mr. PradeepDinodia Director
Gen. (Retd.) V. P. Malik Director
Mr. Analjit Singh Director
Dr. Pritam Singh Director
Mr. M. Damodaran Director
Mr. Ravinath Director
Dr. AnandC.Burman Director
Dr. BrijmohanLallMunjal
Mr. Munjal is the founder Director and Chairman of the Company and the $3.2 billion
Hero Group. He is the Past President of Confederation of Indian Industry (CII), Society
of Indian Automobile Manufacturers (SIAM) and was a Member of the Board of the
Country's Central Bank (Reserve Bank of India). In recognition of his contribution to
industry, Mr. Munjal was conferred the Padma Bhushan Award by the Union
Government.
Corporate Governance:
At Hero MotoCorp, it is the firm’s belief that the essence of Corporate Governance lies
in the phrase ''Your Company''. It is ''Your'' Company because it belongs to you - the
shareholders. The Chairman and Directors are ''Your'' fiduciaries and trustees. Their
objective is to take the business forward in such a way that it maximizes ''Your'' long-
term value.
This Company is committed to benchmarking itself with global standards for providing
good Corporate Governance. It has put in place an effective Corporate Governance
System which ensures that the provisions of Clause 49 of the Listing Agreement are duly
complied with.
RNS FIRST GRADE COLLEGE Page 39
Mr. PradeepDinodia Director
Gen. (Retd.) V. P. Malik Director
Mr. Analjit Singh Director
Dr. Pritam Singh Director
Mr. M. Damodaran Director
Mr. Ravinath Director
Dr. AnandC.Burman Director
Dr. BrijmohanLallMunjal
Mr. Munjal is the founder Director and Chairman of the Company and the $3.2 billion
Hero Group. He is the Past President of Confederation of Indian Industry (CII), Society
of Indian Automobile Manufacturers (SIAM) and was a Member of the Board of the
Country's Central Bank (Reserve Bank of India). In recognition of his contribution to
industry, Mr. Munjal was conferred the Padma Bhushan Award by the Union
Government.
Corporate Governance:
At Hero MotoCorp, it is the firm’s belief that the essence of Corporate Governance lies
in the phrase ''Your Company''. It is ''Your'' Company because it belongs to you - the
shareholders. The Chairman and Directors are ''Your'' fiduciaries and trustees. Their
objective is to take the business forward in such a way that it maximizes ''Your'' long-
term value.
This Company is committed to benchmarking itself with global standards for providing
good Corporate Governance. It has put in place an effective Corporate Governance
System which ensures that the provisions of Clause 49 of the Listing Agreement are duly
complied with.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 40
The Board has also evolved and adopted a Code of Conduct based on the principles of
Good Corporate Governance and best management practices being followed globally.
GRADING POSITIVES
Market leadership, strong brand equity, professional management, high operating
efficiency and established scale economies. Strong financial profile characterized by
healthy margins, high profitability and cash generation. Potential upsides to our
estimates: (1) HMCL sustains its current market share, leveraging its brand equity,
product performance and distribution strengths; (2) industry growth exceeds our
estimates over the medium term despite existing concerns on macro-economic scenario;
(3) HMCL betters the margins estimated by us via sustained business growth and
increases in operating efficiency even in the face of competitive and cost pressures.
GRADING SENSITIVITIES
Key sensitivities to our estimates include:
(1) Inflation in input costs not being neutralized by price increases because of
competitive pressures;
(2) High concentration on Executive segment;
(3) Intensifying competition from global players;
(4) Ability to develop in-house technical capability or form alternate technical tie-ups
with external institutions.
RNS FIRST GRADE COLLEGE Page 40
The Board has also evolved and adopted a Code of Conduct based on the principles of
Good Corporate Governance and best management practices being followed globally.
GRADING POSITIVES
Market leadership, strong brand equity, professional management, high operating
efficiency and established scale economies. Strong financial profile characterized by
healthy margins, high profitability and cash generation. Potential upsides to our
estimates: (1) HMCL sustains its current market share, leveraging its brand equity,
product performance and distribution strengths; (2) industry growth exceeds our
estimates over the medium term despite existing concerns on macro-economic scenario;
(3) HMCL betters the margins estimated by us via sustained business growth and
increases in operating efficiency even in the face of competitive and cost pressures.
GRADING SENSITIVITIES
Key sensitivities to our estimates include:
(1) Inflation in input costs not being neutralized by price increases because of
competitive pressures;
(2) High concentration on Executive segment;
(3) Intensifying competition from global players;
(4) Ability to develop in-house technical capability or form alternate technical tie-ups
with external institutions.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 41
3.5 ORGANIZATIONAL STRUCTURE
Board of Directors
President
General Manager
Chief Engineer ISO center
Manager
Engineering
department
;,ijmg
fegf
Producti
on dept
Quality
dept
HR
dept
CEO
Financ
e dept
ware
house
Hongko
ng
office
Purchasi
ng dept
Biz
dept
Manager
ISO Document
control center
Tooling
workshop
Stamping
workshop
Die-casting
workshop
Winding
motor
Printing
workshop
Fans
Assembling
Fina
Assembly
RNS FIRST GRADE COLLEGE Page 41
3.5 ORGANIZATIONAL STRUCTURE
Board of Directors
President
General Manager
Chief Engineer ISO center
Manager
Engineering
department
;,ijmg
fegf
Producti
on dept
Quality
dept
HR
dept
CEO
Financ
e dept
ware
house
Hongko
ng
office
Purchasi
ng dept
Biz
dept
Manager
ISO Document
control center
Tooling
workshop
Stamping
workshop
Die-casting
workshop
Winding
motor
Printing
workshop
Fans
Assembling
Fina
Assembly
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 42
Profile of target customer
Hero MotoCorp basically targets the every each and segments of the market. So there are
some products like splendor, CD- dawn (rs40000-50000) they made for lower segment of
the market and glamour, passion, CBZ, karizma (rs above 50000) for the upper segment
of the market. And now they are trying to target the young people of the market.
India’s Hero MotoCorp, the world’s largest producer of motorcycles and scooters, has
announced its intention to expand globally, with plans to sell vehicles on three continents
and nearly double its unit sales within five years. The company, whose family
shareholders bought out its former partner Honda Motor this year, said it would invest
about $1bn to expand internationally in south-east Asia, Africa, and Central and Latin
America.
Customer Relationship Activity
For making a better relationship with customer they always use genuine parts in their
product. And after selling they have the services and maintenances. Their constant
endeavor is to support the company's mandate of providing highest level of customer
satisfaction by taking good care of customer’s two-wheeler service and maintenance
through their vast network of more than 2100 committed dealers and service outlets
spread across the country.
Apart from that hero motocorp focused on cleanliness and other aesthetics of the service
stations and add such air-conditioned waiting area, internet surfing, coffee shops etc to
enhance the in-house experience of the customers at those “customer touch point”. To
ensure that millions of customers in the rural area are not left waiting for adequate service
as it is impossible for the company to introduce service station at every nook and corner
of the country, mobile service stations are regularly arranged with prior intimation to
public about the rout that the mobile workshop would take when passing through that
region so that customers can come and get their two wheelers serviced. All these
activities are aimed to increase the customer loyalty and thus retaining customers.
RNS FIRST GRADE COLLEGE Page 42
Profile of target customer
Hero MotoCorp basically targets the every each and segments of the market. So there are
some products like splendor, CD- dawn (rs40000-50000) they made for lower segment of
the market and glamour, passion, CBZ, karizma (rs above 50000) for the upper segment
of the market. And now they are trying to target the young people of the market.
India’s Hero MotoCorp, the world’s largest producer of motorcycles and scooters, has
announced its intention to expand globally, with plans to sell vehicles on three continents
and nearly double its unit sales within five years. The company, whose family
shareholders bought out its former partner Honda Motor this year, said it would invest
about $1bn to expand internationally in south-east Asia, Africa, and Central and Latin
America.
Customer Relationship Activity
For making a better relationship with customer they always use genuine parts in their
product. And after selling they have the services and maintenances. Their constant
endeavor is to support the company's mandate of providing highest level of customer
satisfaction by taking good care of customer’s two-wheeler service and maintenance
through their vast network of more than 2100 committed dealers and service outlets
spread across the country.
Apart from that hero motocorp focused on cleanliness and other aesthetics of the service
stations and add such air-conditioned waiting area, internet surfing, coffee shops etc to
enhance the in-house experience of the customers at those “customer touch point”. To
ensure that millions of customers in the rural area are not left waiting for adequate service
as it is impossible for the company to introduce service station at every nook and corner
of the country, mobile service stations are regularly arranged with prior intimation to
public about the rout that the mobile workshop would take when passing through that
region so that customers can come and get their two wheelers serviced. All these
activities are aimed to increase the customer loyalty and thus retaining customers.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 43
3.6 PRODUCT PROFILE
KARIZMA ZMR
The Hero Karizma ZMR is a motorcycle manufactured by Hero Moto Corp in India. It
was launched as a cosmetic upgrade to karizma ZMR in September 2009.
Self start, Disk brake, Alloy Wheel
Displacement (cc) : 223
Fuel tank capacity (liters) : 15.3
Engine type : Air cooled, 4-stroke single cylinder OHC, Fuel injection, Oil
Cooler
Weight (Kg) : 157
RNS FIRST GRADE COLLEGE Page 43
3.6 PRODUCT PROFILE
KARIZMA ZMR
The Hero Karizma ZMR is a motorcycle manufactured by Hero Moto Corp in India. It
was launched as a cosmetic upgrade to karizma ZMR in September 2009.
Self start, Disk brake, Alloy Wheel
Displacement (cc) : 223
Fuel tank capacity (liters) : 15.3
Engine type : Air cooled, 4-stroke single cylinder OHC, Fuel injection, Oil
Cooler
Weight (Kg) : 157
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 44
Splendor PLUS
Displacement (cc) : 97.2
Fuel tank capacity (liter) : 11
Engine type : Air cooled, 4-stroke single cylinder OHC
Starting method : Kick start
Weight (Kg) : 109
Dimensions (mm) : 2000 X 720 X 1040
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Splendor PLUS
Displacement (cc) : 97.2
Fuel tank capacity (liter) : 11
Engine type : Air cooled, 4-stroke single cylinder OHC
Starting method : Kick start
Weight (Kg) : 109
Dimensions (mm) : 2000 X 720 X 1040
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 45
IGNITOR
Displacement (cc) : 124.7
Fuel tank capacity (liter) : 9
Engine type : Air cooled, 4-strok single cylinder OHC
Starting method : Self start, Kick start
Kerb weight (kg) : 129
Dimensions (mm) : 2010 X 710 X 1095
RNS FIRST GRADE COLLEGE Page 45
IGNITOR
Displacement (cc) : 124.7
Fuel tank capacity (liter) : 9
Engine type : Air cooled, 4-strok single cylinder OHC
Starting method : Self start, Kick start
Kerb weight (kg) : 129
Dimensions (mm) : 2010 X 710 X 1095
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 46
HERO HUNK
Displacement (cc) : 149.2
Fuel tank capacity (liter): 12.4
Engine type : Air cooled, 4-stoke single cylinder OHC
Starting method : Self start, kick start
Kerb weight (kg) : 147
Dimensions (mm) : 2080 X 765 X 1095
RNS FIRST GRADE COLLEGE Page 46
HERO HUNK
Displacement (cc) : 149.2
Fuel tank capacity (liter): 12.4
Engine type : Air cooled, 4-stoke single cylinder OHC
Starting method : Self start, kick start
Kerb weight (kg) : 147
Dimensions (mm) : 2080 X 765 X 1095
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 47
Hero i-Smart
Displacement (cc) : 97.2
Fuel tank capacity (liter) : 8.7
Engine type : Air cooled, 4-stroke single cylinder OHC
Starting method : Self start, Kick start
Kerb weight (kg) : 110(self)
Dimensions (mm) : 1965 X 770 X 1095
RNS FIRST GRADE COLLEGE Page 47
Hero i-Smart
Displacement (cc) : 97.2
Fuel tank capacity (liter) : 8.7
Engine type : Air cooled, 4-stroke single cylinder OHC
Starting method : Self start, Kick start
Kerb weight (kg) : 110(self)
Dimensions (mm) : 1965 X 770 X 1095
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 48
Hero MAESTRO
Displacement (cc) : 110.9
Engine type : Air cooled, 4-stroke single cylinder OHC
Starting method : self start
Kerb weight (kg) : 110
Dimensions (mm) : 1841 X 695 X 1190
RNS FIRST GRADE COLLEGE Page 48
Hero MAESTRO
Displacement (cc) : 110.9
Engine type : Air cooled, 4-stroke single cylinder OHC
Starting method : self start
Kerb weight (kg) : 110
Dimensions (mm) : 1841 X 695 X 1190
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 49
Hero Duet
Displacement (cc) : 110.9
Engine type : Air cooled, 4-stroke single cylinder OHC
Starting method : Self start
Kerb weight (kg) : 116
Dimension (mm) : 1830 X 726 X 1139
RNS FIRST GRADE COLLEGE Page 49
Hero Duet
Displacement (cc) : 110.9
Engine type : Air cooled, 4-stroke single cylinder OHC
Starting method : Self start
Kerb weight (kg) : 116
Dimension (mm) : 1830 X 726 X 1139
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 50
Hero Pleasure
Displacement (cc) : 102
Fuel tank capacity (liter) : 5
Engine type : Air cooled, 4-stroke single cylinder OHC
Starting method : Self start
Kerb weight (kg) : 101
Dimensions (mm) : 1750 X 705 X 1115
RNS FIRST GRADE COLLEGE Page 50
Hero Pleasure
Displacement (cc) : 102
Fuel tank capacity (liter) : 5
Engine type : Air cooled, 4-stroke single cylinder OHC
Starting method : Self start
Kerb weight (kg) : 101
Dimensions (mm) : 1750 X 705 X 1115
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 51
Hero Xtreme
Displacement (cc) : 149.2
Fuel tank capacity (liter) : 12.1
Engine type : Air cooled, 4-stroke single cylinder OHC
Starting method : self start, kick start
Kerb weight (kg) : 145 (Disc brake), 146 (Double disc brake)
Dimensions (mm) : 2060 X 765 X 1145
RNS FIRST GRADE COLLEGE Page 51
Hero Xtreme
Displacement (cc) : 149.2
Fuel tank capacity (liter) : 12.1
Engine type : Air cooled, 4-stroke single cylinder OHC
Starting method : self start, kick start
Kerb weight (kg) : 145 (Disc brake), 146 (Double disc brake)
Dimensions (mm) : 2060 X 765 X 1145
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 52
Hero Impulse
Displacement (cc) : 149.2
Fuel tank capacity (liter) : 11.1
Engine type : Air cooled, 4-stroke single cylinder OHC
Starting method : self start
Dimension (mm) : 2100 X 820 X 1160
RNS FIRST GRADE COLLEGE Page 52
Hero Impulse
Displacement (cc) : 149.2
Fuel tank capacity (liter) : 11.1
Engine type : Air cooled, 4-stroke single cylinder OHC
Starting method : self start
Dimension (mm) : 2100 X 820 X 1160
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 53
3.7 SOWT Analysis
Strength
Huge brand equity and one of the
biggest players in the two wheelers
Indian market.
Excellent R&D, and wide variety of
products in every segment.
Good advertising and excellent
rebranding from hero Honda to Hero
moto corp.
Weakness
Absence in the premium bike segment
High imports for its spare parts i.e. over
30% imports.
Most of the products have similar feature
and low on design and innovation.
Opportunity
Two-wheeler segments are one of the
most growing industries.
Exporting of bikes if limited i.e.
untapped international markets.
Threats
Strong competition from Indian as well
as international brands.
Dependence on government policies and
rising fuel prices.
Better public transport will affect two-
wheeler sales.
RNS FIRST GRADE COLLEGE Page 53
3.7 SOWT Analysis
Strength
Huge brand equity and one of the
biggest players in the two wheelers
Indian market.
Excellent R&D, and wide variety of
products in every segment.
Good advertising and excellent
rebranding from hero Honda to Hero
moto corp.
Weakness
Absence in the premium bike segment
High imports for its spare parts i.e. over
30% imports.
Most of the products have similar feature
and low on design and innovation.
Opportunity
Two-wheeler segments are one of the
most growing industries.
Exporting of bikes if limited i.e.
untapped international markets.
Threats
Strong competition from Indian as well
as international brands.
Dependence on government policies and
rising fuel prices.
Better public transport will affect two-
wheeler sales.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 54
3.8 COMPITITORS
1. TVS motors
2. Royal Enfield
3. Honda
4. Suzuki
5. Yamaha
3.9 AWARDS AND RECOGNITIONS
Two-wheeler Manufacturer of the Year award by Bike India magazine. Adjudged the
"Bike Manufacturer of the Year" at the Economic Times ZigWheels Car and Bike
Awards.
CNBC Awaaz - Storyboard special commendation for "Effective rebranding of a new
corporate entity" by CNBC Awaaz Consumer Awards
"Most Recommended Two-Wheeler Brand of the Year" award by CNBC Awaaz
Consumer Awards
Colloquy Loyalty Awards "Innovation in Loyalty Marketing International 2011" for
Hero Good Life
"Best Activity Generating Short or Long-Term Brand Loyalty" by the Promotion
Marketing Award of Asia Order of Merit for Hero Good Life
Ranked No 1 brand in the Auto (Two-Wheelers) category in the Brand Equity "Most
Trusted Brand" 2011 serve
RNS FIRST GRADE COLLEGE Page 54
3.8 COMPITITORS
1. TVS motors
2. Royal Enfield
3. Honda
4. Suzuki
5. Yamaha
3.9 AWARDS AND RECOGNITIONS
Two-wheeler Manufacturer of the Year award by Bike India magazine. Adjudged the
"Bike Manufacturer of the Year" at the Economic Times ZigWheels Car and Bike
Awards.
CNBC Awaaz - Storyboard special commendation for "Effective rebranding of a new
corporate entity" by CNBC Awaaz Consumer Awards
"Most Recommended Two-Wheeler Brand of the Year" award by CNBC Awaaz
Consumer Awards
Colloquy Loyalty Awards "Innovation in Loyalty Marketing International 2011" for
Hero Good Life
"Best Activity Generating Short or Long-Term Brand Loyalty" by the Promotion
Marketing Award of Asia Order of Merit for Hero Good Life
Ranked No 1 brand in the Auto (Two-Wheelers) category in the Brand Equity "Most
Trusted Brand" 2011 serve
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 55
Chapter 4
DATA ANALYSIS AND INTERPRETATION
Table 4.1
Table showing ‘the classification of respondents on gender’
Gender
No of respondents
Percentage
Male
66
66%
Female
34
34%
Total
100
100%
Analysis:
The above table showing 66% of the respondents are Male and 34% of the respondents
are Female.
Inference:
The above information says that maximum number of respondents is from the male and
the minimum number of respondents from the Female. So the more number of response
from the male.
RNS FIRST GRADE COLLEGE Page 55
Chapter 4
DATA ANALYSIS AND INTERPRETATION
Table 4.1
Table showing ‘the classification of respondents on gender’
Gender
No of respondents
Percentage
Male
66
66%
Female
34
34%
Total
100
100%
Analysis:
The above table showing 66% of the respondents are Male and 34% of the respondents
are Female.
Inference:
The above information says that maximum number of respondents is from the male and
the minimum number of respondents from the Female. So the more number of response
from the male.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 56
Graph No.4.1
Showing ‘the result for classification of respondents on the basis of their gender’
0
10
20
30
40
50
60
70
Male Female
1 2
Respondent
RNS FIRST GRADE COLLEGE Page 56
Graph No.4.1
Showing ‘the result for classification of respondents on the basis of their gender’
0
10
20
30
40
50
60
70
Male Female
1 2
Respondent
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 57
Table No. 4.2:
Table showing ‘the classification of respondents on the basis of occupation’
Occupation
Respondents
Percentage
Business
14
14%
Govt. Employee
10
10%
Students
60
60%
Pvt. Employee
16
16%
Total
100
100%
Analysis:
The above table shows it’s clear that 22% are Pvt. Sector followed by 30% are Govt.
Employee 12% Students, 22% Business
Inference:
Occupation is the important segmenting factor, which the dealer should consider, thus the
dealer should have a best interest of this segment, so here says that maximum number of
respondents is students and the minimum number of respondents is Government
employee.
RNS FIRST GRADE COLLEGE Page 57
Table No. 4.2:
Table showing ‘the classification of respondents on the basis of occupation’
Occupation
Respondents
Percentage
Business
14
14%
Govt. Employee
10
10%
Students
60
60%
Pvt. Employee
16
16%
Total
100
100%
Analysis:
The above table shows it’s clear that 22% are Pvt. Sector followed by 30% are Govt.
Employee 12% Students, 22% Business
Inference:
Occupation is the important segmenting factor, which the dealer should consider, thus the
dealer should have a best interest of this segment, so here says that maximum number of
respondents is students and the minimum number of respondents is Government
employee.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 58
Graph No. 4.2:
Showing ‘the basis of occupation’
0
10
20
30
40
50
60
BusinessGovt. employee Student pvt. Employee
1 2 3 4
Respondents
Respondents
RNS FIRST GRADE COLLEGE Page 58
Graph No. 4.2:
Showing ‘the basis of occupation’
0
10
20
30
40
50
60
BusinessGovt. employee Student pvt. Employee
1 2 3 4
Respondents
Respondents
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 59
Table No. 4.3
Table showing ‘The classification of respondents on the basis of their educational
qualification’
Educational
Qualification
Respondents
Percentage
Graduate
40
40%
Postgraduate
13
13%
PUC/Diploma
44
44%
SSLC & BELOW
03
03%
Total
100
100%
Analysis:
The above table show that 40% of the respondents are Graduate, 13% of the respondents
are Post Graduate, 44% of the respondents are PUC/Diploma, and only 3% of the
respondents are SSLC & Below.
Inference:
The above information says that maximum number of the respondents have done their
Post Graduate, and the minimum numbers of the respondents have done their SSLC. The
more responds are post graduate.
RNS FIRST GRADE COLLEGE Page 59
Table No. 4.3
Table showing ‘The classification of respondents on the basis of their educational
qualification’
Educational
Qualification
Respondents
Percentage
Graduate
40
40%
Postgraduate
13
13%
PUC/Diploma
44
44%
SSLC & BELOW
03
03%
Total
100
100%
Analysis:
The above table show that 40% of the respondents are Graduate, 13% of the respondents
are Post Graduate, 44% of the respondents are PUC/Diploma, and only 3% of the
respondents are SSLC & Below.
Inference:
The above information says that maximum number of the respondents have done their
Post Graduate, and the minimum numbers of the respondents have done their SSLC. The
more responds are post graduate.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 60
Graph no. 4.3
Showing ‘The classification of respondents based on their Educational
Qualification’
40%
13%
44%
3%
Respondent
1 Graduate2 Post Graduate3 PUC/Dipalmo 4 SSLC
RNS FIRST GRADE COLLEGE Page 60
Graph no. 4.3
Showing ‘The classification of respondents based on their Educational
Qualification’
40%
13%
44%
3%
Respondent
1 Graduate2 Post Graduate3 PUC/Dipalmo 4 SSLC
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 61
Table No. 4.4
Table showing ‘the classification of respondents based on their income’
Income
Respondents
Percentages
Below 10000
48
48%
11000-20000
24
24%
21000-30000
20
20%
31000 & Above
08
08%
Total
100
100%
Analysis:
The above table shows that below 10,000 income people are purchasing hero bike more
by observing respondents.
Inference:
Income is an important differentiating factor that influences buying behavior. So above
graph shows that income of below Rs10,000 is the customers of PROVIDENT
MOTORS. So the above analysis says that below Rs10,000 income respondents are own
maximum number of bikes, and 31,000 and above income of the respondents own
minimum number if bikes.
RNS FIRST GRADE COLLEGE Page 61
Table No. 4.4
Table showing ‘the classification of respondents based on their income’
Income
Respondents
Percentages
Below 10000
48
48%
11000-20000
24
24%
21000-30000
20
20%
31000 & Above
08
08%
Total
100
100%
Analysis:
The above table shows that below 10,000 income people are purchasing hero bike more
by observing respondents.
Inference:
Income is an important differentiating factor that influences buying behavior. So above
graph shows that income of below Rs10,000 is the customers of PROVIDENT
MOTORS. So the above analysis says that below Rs10,000 income respondents are own
maximum number of bikes, and 31,000 and above income of the respondents own
minimum number if bikes.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 62
Graph No: 4.4
Showing the result for ‘the basis of their income’
48%
24%
20%
8%
Respondent
1 Below 10000
2 11000-20000
3 21000-30000
4 31000 & Above
RNS FIRST GRADE COLLEGE Page 62
Graph No: 4.4
Showing the result for ‘the basis of their income’
48%
24%
20%
8%
Respondent
1 Below 10000
2 11000-20000
3 21000-30000
4 31000 & Above
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 63
Table No. 4.5
Table showing “the classification of respondents based on their Age”
Age
Respondents
Percentage
18-25
46
46%
26-30
27
27%
31-40
19
19%
41-Above
08
08%
Total
100
100
Analysis:
The above table shows that the age of 18-25 is 46%, and the age of 26-30 is 27%, and
the age of 31-40 is 19%, and the age of 41 & above is 8%.
Inference:
The above information says that maximum number of respondents from the age of 18-25
years are own the two-wheeler and minimum number of the respondents from the age of
41 years above are own the two-wheeler. The analysis says that the young people will
buy more number of two-wheeler.
RNS FIRST GRADE COLLEGE Page 63
Table No. 4.5
Table showing “the classification of respondents based on their Age”
Age
Respondents
Percentage
18-25
46
46%
26-30
27
27%
31-40
19
19%
41-Above
08
08%
Total
100
100
Analysis:
The above table shows that the age of 18-25 is 46%, and the age of 26-30 is 27%, and
the age of 31-40 is 19%, and the age of 41 & above is 8%.
Inference:
The above information says that maximum number of respondents from the age of 18-25
years are own the two-wheeler and minimum number of the respondents from the age of
41 years above are own the two-wheeler. The analysis says that the young people will
buy more number of two-wheeler.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 64
Graph No. 4.5
Showing “the classification of respondent based on their Age”
0
5
10
15
20
25
30
35
40
45
50
18-25 26-30 31-40 41 & Above
1 2 3 4
Respondent
Respondent
RNS FIRST GRADE COLLEGE Page 64
Graph No. 4.5
Showing “the classification of respondent based on their Age”
0
5
10
15
20
25
30
35
40
45
50
18-25 26-30 31-40 41 & Above
1 2 3 4
Respondent
Respondent
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 65
Table No. 4.6
The table showing that number of respondents owns the Two-wheeler
Scale
Respondents
Percentage
Yes
99
99%
No
01
01%
Total
100
100%
Analysis:
The above tables show that 99% of the respondents are own the two- wheeler and the
only 1% are not own the two- wheeler.
Inference:
The above information says that maximum number of respondents are having 2 wheelers,
so the above analysis express that two-wheeler respondents are more and the least is only
one percent. So there is a broad scope for two wheelers in the market.
RNS FIRST GRADE COLLEGE Page 65
Table No. 4.6
The table showing that number of respondents owns the Two-wheeler
Scale
Respondents
Percentage
Yes
99
99%
No
01
01%
Total
100
100%
Analysis:
The above tables show that 99% of the respondents are own the two- wheeler and the
only 1% are not own the two- wheeler.
Inference:
The above information says that maximum number of respondents are having 2 wheelers,
so the above analysis express that two-wheeler respondents are more and the least is only
one percent. So there is a broad scope for two wheelers in the market.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 66
Graph No. 4.6
Showing “the classification of respondent who owns the two-wheeler”
0
10
20
30
40
50
60
70
80
90
100
Yes
No1
2
99
1
Respondent
Respondent
RNS FIRST GRADE COLLEGE Page 66
Graph No. 4.6
Showing “the classification of respondent who owns the two-wheeler”
0
10
20
30
40
50
60
70
80
90
100
Yes
No1
2
99
1
Respondent
Respondent
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 67
Table No. 4.7
Table showing “that the company of two-wheeler respondent own”
Scale
Respondent
Percentage
Hero
42
42%
Yamaha
14
14%
Bajaj
20
20%
Others
24
24%
Total
100
100%
Analysis:
The above table shows that 42% of the respondent from Hero, 14% of respondent from
Yamaha, 20% of respondent from Bajaj, and others 24%.
Inference:
The above information says that the maximum number of respondent from the Hero bikes
and the minimum number of respondents are from the Yamaha. So the above analysis
says that more number of respondents are prefer to buy the Hero motorcycle.
RNS FIRST GRADE COLLEGE Page 67
Table No. 4.7
Table showing “that the company of two-wheeler respondent own”
Scale
Respondent
Percentage
Hero
42
42%
Yamaha
14
14%
Bajaj
20
20%
Others
24
24%
Total
100
100%
Analysis:
The above table shows that 42% of the respondent from Hero, 14% of respondent from
Yamaha, 20% of respondent from Bajaj, and others 24%.
Inference:
The above information says that the maximum number of respondent from the Hero bikes
and the minimum number of respondents are from the Yamaha. So the above analysis
says that more number of respondents are prefer to buy the Hero motorcycle.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 68
Graph No. 4.7
Showing “the classification of respondent of different companies of 2 wheeler”
0
5
10
15
20
25
30
35
40
45
Hero
Yamaha
Bajaj
Others
1
2
3
4
Respondent
Respondent
RNS FIRST GRADE COLLEGE Page 68
Graph No. 4.7
Showing “the classification of respondent of different companies of 2 wheeler”
0
5
10
15
20
25
30
35
40
45
Hero
Yamaha
Bajaj
Others
1
2
3
4
Respondent
Respondent
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 69
Table No. 4.8
Table showing “that the criteria to purchase a two-wheeler”
Scale
Respondents
Percentage
Quality
62
62%
Price
21
21%
Availability
11
11%
Service
06
06%
Total
100
100%
Analysis:
The above table shows that 62% of the respondent will see the Quality of the 2 wheeler,
21% of the respondent will see the price of the 2 wheeler, 11% of the respondent will see
the Availability of the 2 wheeler, and 06% of the respondents will see the services of the
2 wheeler.
Inference:
The above information says that maximum number of respondent will prefer to the
Quality of the two-wheeler and the minimum number of respondents will prefer to the
services of the two-wheeler.
RNS FIRST GRADE COLLEGE Page 69
Table No. 4.8
Table showing “that the criteria to purchase a two-wheeler”
Scale
Respondents
Percentage
Quality
62
62%
Price
21
21%
Availability
11
11%
Service
06
06%
Total
100
100%
Analysis:
The above table shows that 62% of the respondent will see the Quality of the 2 wheeler,
21% of the respondent will see the price of the 2 wheeler, 11% of the respondent will see
the Availability of the 2 wheeler, and 06% of the respondents will see the services of the
2 wheeler.
Inference:
The above information says that maximum number of respondent will prefer to the
Quality of the two-wheeler and the minimum number of respondents will prefer to the
services of the two-wheeler.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 70
Graph No. 4.8
Showing “the classification of respondent of criteria to purchase a two wheeler”
0
10
20
30
40
50
60
70
Qualiy Price Avalibility Service
1 2 3 4
Respondent
Respondent
RNS FIRST GRADE COLLEGE Page 70
Graph No. 4.8
Showing “the classification of respondent of criteria to purchase a two wheeler”
0
10
20
30
40
50
60
70
Qualiy Price Avalibility Service
1 2 3 4
Respondent
Respondent
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 71
Table No. 4.9
Table showing “whether the 2 wheeler is designed as per the condition of Indian
roads”
Scale
Respondent
Percentage
Yes
91
91%
No
09
09%
Total
100
100%
Analysis:
The above table shows that 91% of the respondent would like to express their opinion
that the two wheelers are designed as per the condition if the Indian roads, 09% of the
respondent would like to say that the designs of two wheeler are not as per the road
conditions.
Inference:
The above information says that maximum number of respondent are say that the design
as per the conditions of the road and only the least number of respondents are as per
saying that two wheelers are not designed as per the conductions of the road. So the
above analysis says that more number of the respondents are comfortable with the two-
wheeler designs as per road conditions.
RNS FIRST GRADE COLLEGE Page 71
Table No. 4.9
Table showing “whether the 2 wheeler is designed as per the condition of Indian
roads”
Scale
Respondent
Percentage
Yes
91
91%
No
09
09%
Total
100
100%
Analysis:
The above table shows that 91% of the respondent would like to express their opinion
that the two wheelers are designed as per the condition if the Indian roads, 09% of the
respondent would like to say that the designs of two wheeler are not as per the road
conditions.
Inference:
The above information says that maximum number of respondent are say that the design
as per the conditions of the road and only the least number of respondents are as per
saying that two wheelers are not designed as per the conductions of the road. So the
above analysis says that more number of the respondents are comfortable with the two-
wheeler designs as per road conditions.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 72
Graph No. 4.9
Showing “the classification of respondent whether the 2 wheeler is designed as per
the condition”
91%
9%
Respondent
1 Yes2 No
RNS FIRST GRADE COLLEGE Page 72
Graph No. 4.9
Showing “the classification of respondent whether the 2 wheeler is designed as per
the condition”
91%
9%
Respondent
1 Yes2 No
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 73
Table No. 4.10
Table showing “whether the respondents are come across the advertisement of two-
wheeler in media”
Scale
Respondent
Percentage
Yes
98
98%
No
02
02%
Total
100
100%
Analysis:
The above table shows that 98% of the respondents are aware of the advertisement and
only 2% of the respondents are not aware of the advertisement.
Inference:
The above information says that the maximum respondents express that got awareness of
the two wheelers through advertisement, so the above analysis says that only 2 percent of
the respondents express that they got to know about two-wheeler advertisement not by
media.
.
RNS FIRST GRADE COLLEGE Page 73
Table No. 4.10
Table showing “whether the respondents are come across the advertisement of two-
wheeler in media”
Scale
Respondent
Percentage
Yes
98
98%
No
02
02%
Total
100
100%
Analysis:
The above table shows that 98% of the respondents are aware of the advertisement and
only 2% of the respondents are not aware of the advertisement.
Inference:
The above information says that the maximum respondents express that got awareness of
the two wheelers through advertisement, so the above analysis says that only 2 percent of
the respondents express that they got to know about two-wheeler advertisement not by
media.
.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 74
Graph No. 4.10
Showing “the classification of respondent is come across the advertisement of two-
wheeler”
0
10
20
30
40
50
60
70
80
90
100
Yes No
1 2
98
2
Respondent
Respondent
RNS FIRST GRADE COLLEGE Page 74
Graph No. 4.10
Showing “the classification of respondent is come across the advertisement of two-
wheeler”
0
10
20
30
40
50
60
70
80
90
100
Yes No
1 2
98
2
Respondent
Respondent
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 75
Table No. 4.11
Table showing “in which media the respondent has seen advertisement”
Scale
Respondent
Percentage
TV
66
66%
Newspaper/Magazine
16
16%
Radio
08
08%
Internet/social net
work
10
10%
Total
100
100%
Analysis:
The above table shows that 66% of the respondent has seen in the TV, 16% of the
respondent has seen in the Newspaper/Magazine, 08% of the respondent have heard in
the Radio, and 10% of the respondent are aware through internet/social media.
Inference:
The above information shows that the maximum number of respondent have saw in the
TV about the advertisement of Hero and the minimum number of the respondents hard
from the Radio.
RNS FIRST GRADE COLLEGE Page 75
Table No. 4.11
Table showing “in which media the respondent has seen advertisement”
Scale
Respondent
Percentage
TV
66
66%
Newspaper/Magazine
16
16%
Radio
08
08%
Internet/social net
work
10
10%
Total
100
100%
Analysis:
The above table shows that 66% of the respondent has seen in the TV, 16% of the
respondent has seen in the Newspaper/Magazine, 08% of the respondent have heard in
the Radio, and 10% of the respondent are aware through internet/social media.
Inference:
The above information shows that the maximum number of respondent have saw in the
TV about the advertisement of Hero and the minimum number of the respondents hard
from the Radio.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 76
Graph No. 4.11
Showing “the classification of respondent has seen the advertisement”
0
10
20
30
40
50
60
70
TV News Paper Radio Internet
1 2 3 4
Respondent
Respondent
RNS FIRST GRADE COLLEGE Page 76
Graph No. 4.11
Showing “the classification of respondent has seen the advertisement”
0
10
20
30
40
50
60
70
TV News Paper Radio Internet
1 2 3 4
Respondent
Respondent
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 77
Table No. 4.12
Table showing “what is the opinion about the Hero after it’s separate from Honda”
Scale
Respondent
Percentage
Excellent
18
18%
Good
16
16%
Average
60
60%
Poor
06
06%
Total
100
100%
Analysis:
The above table shows that the opinion about the Hero after it’s separate from Honda
where as 18% of the respondent says its Excellent, 16% of them say that it’s Good, 60%
of them says that it’s Average, and 06% of them says that it’s Poor.
Inference:
The information shows that the maximum number of respondent are not fully satisfied
with the Hero after it’s separate from Honda and the minimum number of respondents
say that they are giving ‘average’ grade for Hero two wheelers.
RNS FIRST GRADE COLLEGE Page 77
Table No. 4.12
Table showing “what is the opinion about the Hero after it’s separate from Honda”
Scale
Respondent
Percentage
Excellent
18
18%
Good
16
16%
Average
60
60%
Poor
06
06%
Total
100
100%
Analysis:
The above table shows that the opinion about the Hero after it’s separate from Honda
where as 18% of the respondent says its Excellent, 16% of them say that it’s Good, 60%
of them says that it’s Average, and 06% of them says that it’s Poor.
Inference:
The information shows that the maximum number of respondent are not fully satisfied
with the Hero after it’s separate from Honda and the minimum number of respondents
say that they are giving ‘average’ grade for Hero two wheelers.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 78
Graph No. 4.12
Showing “the classification opinion about the 2 wheeler of Hero after it’s separate
from Honda”
0
10
20
30
40
50
60
Excellent Good Average Poor
1 2 3 4
Respondent
Respondent
RNS FIRST GRADE COLLEGE Page 78
Graph No. 4.12
Showing “the classification opinion about the 2 wheeler of Hero after it’s separate
from Honda”
0
10
20
30
40
50
60
Excellent Good Average Poor
1 2 3 4
Respondent
Respondent
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 79
Table No. 4.13
Table showing “the respondent about the design/look of Hero Bikes”
Scale
Respondent
Percentage
Excellent
26
26%
Good
38
38%
Average
20
20%
Poor
16
16%
Total
100
100%
Analysis:
The above table shows about the design/look of Hero bikes where as 26% of the
respondent are says that it’s Excellent, 38% of them says that it’s Good, 20% of them
says that it’s Average, and 16% of them says that it’s Poor.
Inference:
The above information says that the maximum number of respondent are happy with the
design/look of Hero bike by grading good and the minimum number of the respondents
says the design/look of the Hero bike not good by grading poor.
RNS FIRST GRADE COLLEGE Page 79
Table No. 4.13
Table showing “the respondent about the design/look of Hero Bikes”
Scale
Respondent
Percentage
Excellent
26
26%
Good
38
38%
Average
20
20%
Poor
16
16%
Total
100
100%
Analysis:
The above table shows about the design/look of Hero bikes where as 26% of the
respondent are says that it’s Excellent, 38% of them says that it’s Good, 20% of them
says that it’s Average, and 16% of them says that it’s Poor.
Inference:
The above information says that the maximum number of respondent are happy with the
design/look of Hero bike by grading good and the minimum number of the respondents
says the design/look of the Hero bike not good by grading poor.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 80
Graph No.4.13
Showing “the classification of respondent about the design/look of the Hero bikes”
0
5
10
15
20
25
30
35
40
Excellent Good Average Poor
1 2 3 4
Respondent
Respondent
RNS FIRST GRADE COLLEGE Page 80
Graph No.4.13
Showing “the classification of respondent about the design/look of the Hero bikes”
0
5
10
15
20
25
30
35
40
Excellent Good Average Poor
1 2 3 4
Respondent
Respondent
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 81
Table No. 4.14
Table showing “the opinion of the respondent about the fuel efficiency of Hero”
Scale
Respondent
Percentage
Excellent
43
43%
Good
37
37%
Average
12
12%
Poor
08
08%
Total
100
100%
Average:
The above table shows about the fuel efficiency of Hero where as 43% of the respondent
says that it’s Excellent, 37% of them says it’s Good, 12% of them says that it’s Average,
and 08% of the respondent says it’s Poor.
Inference:
The above information the maximum number of respondent says about the fuel efficiency
of Hero is good and the minimum number of the respondent says about the fuel
efficiency of the Hero is poor.By this the more customers are satisfied with fuel
efficiency of Hero two wheelers.
RNS FIRST GRADE COLLEGE Page 81
Table No. 4.14
Table showing “the opinion of the respondent about the fuel efficiency of Hero”
Scale
Respondent
Percentage
Excellent
43
43%
Good
37
37%
Average
12
12%
Poor
08
08%
Total
100
100%
Average:
The above table shows about the fuel efficiency of Hero where as 43% of the respondent
says that it’s Excellent, 37% of them says it’s Good, 12% of them says that it’s Average,
and 08% of the respondent says it’s Poor.
Inference:
The above information the maximum number of respondent says about the fuel efficiency
of Hero is good and the minimum number of the respondent says about the fuel
efficiency of the Hero is poor.By this the more customers are satisfied with fuel
efficiency of Hero two wheelers.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 82
Graph No. 4.14
Showing “the classification of opinion about the fuel efficiency of Hero”
0
5
10
15
20
25
30
35
40
45
Excellent Good Average Poor
1 2 3 4
Respondent
Respondent
RNS FIRST GRADE COLLEGE Page 82
Graph No. 4.14
Showing “the classification of opinion about the fuel efficiency of Hero”
0
5
10
15
20
25
30
35
40
45
Excellent Good Average Poor
1 2 3 4
Respondent
Respondent
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 83
Table No. 4.15
Table showing “opinion of the respondent about the pricing of Hero 2 wheeler”
Scale
Respondent
Percentage
Excellent
21
21%
Good
29
29%
Average
32
32%
Poor
18
18%
Total
100
100%
Average:
The above table shows that the 21% of the respondent says that the pricing of Hero 2
wheeler is Excellent, 29% of them says that it’s good, 32% of them says that it’s
Average, and 18% of them says that it’s poor.
Inference:
From the above information the maximum number of respondent says neither good nor
poor on the pricing of Hero 2 wheeler and the minimum number of the respondents says
the pricing of the two-wheeler is very high by grading ‘poor’.
RNS FIRST GRADE COLLEGE Page 83
Table No. 4.15
Table showing “opinion of the respondent about the pricing of Hero 2 wheeler”
Scale
Respondent
Percentage
Excellent
21
21%
Good
29
29%
Average
32
32%
Poor
18
18%
Total
100
100%
Average:
The above table shows that the 21% of the respondent says that the pricing of Hero 2
wheeler is Excellent, 29% of them says that it’s good, 32% of them says that it’s
Average, and 18% of them says that it’s poor.
Inference:
From the above information the maximum number of respondent says neither good nor
poor on the pricing of Hero 2 wheeler and the minimum number of the respondents says
the pricing of the two-wheeler is very high by grading ‘poor’.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 84
Graph No. 4.15
Showing “opinion of the respondent about the pricing of Hero 2 wheeler”
21%
29%
32%
18%
Respondent
1 Excellent2 Good3 Average4 Poor
RNS FIRST GRADE COLLEGE Page 84
Graph No. 4.15
Showing “opinion of the respondent about the pricing of Hero 2 wheeler”
21%
29%
32%
18%
Respondent
1 Excellent2 Good3 Average4 Poor
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 85
Table No. 4.16
Table showing “the ranking rate given by a respondent to Hero bikes”
Rank
Respondent
Percentage
01 20 20%
02 33 33%
03 27 27%
04 13 13%
05 07 07%
Total 100 100%
Analysis:
From the above table, we can analyze that 20% of the respondent gave 1ranks to Hero
motoCorp, 33% of the respondents gave 2 ranks, 27 % of the respondents gave 3 ranks,
13% of the respondents ranked Hero as 4 and the only 7% of the respondents ranked
Hero as 5.
Inference:
From the above details, we can interpret, that Hero Stood in 2
nd
rank in the market and
the least is 5
th
rank in the market, so the analysis says that the Hero is in the top position
in the market.
RNS FIRST GRADE COLLEGE Page 85
Table No. 4.16
Table showing “the ranking rate given by a respondent to Hero bikes”
Rank
Respondent
Percentage
01 20 20%
02 33 33%
03 27 27%
04 13 13%
05 07 07%
Total 100 100%
Analysis:
From the above table, we can analyze that 20% of the respondent gave 1ranks to Hero
motoCorp, 33% of the respondents gave 2 ranks, 27 % of the respondents gave 3 ranks,
13% of the respondents ranked Hero as 4 and the only 7% of the respondents ranked
Hero as 5.
Inference:
From the above details, we can interpret, that Hero Stood in 2
nd
rank in the market and
the least is 5
th
rank in the market, so the analysis says that the Hero is in the top position
in the market.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 86
Graph No. 4.16
Showing “the result for the ranking rates given by a respondent to Hero bikes”
7%
13%
20%
27%
33%
Respondent
12345
RNS FIRST GRADE COLLEGE Page 86
Graph No. 4.16
Showing “the result for the ranking rates given by a respondent to Hero bikes”
7%
13%
20%
27%
33%
Respondent
12345
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 87
CHAPTER 5
SUMMARY OF FINDINGS & CONCLUSION
FINDINGS
From the above survey, it was found that most of the provident motors customers are
satisfied with the overall selling process of dealers.
From the survey, it was found that male consumers are more than female consumer.
From the survey, it was found that Pvt. Employees are the more customers to Hero
bikes.
From the survey, it was found that the Hero bikes are purchased because it has less
maintenance cost.
From the survey, it was found that the Hero Company is concentrated on mileage
rather than speed of the bike.
From the survey the consumer of Hero Company are less income people because
Hero bike has very less cost of spare parts.
From the survey the Hero Company gives best offers then the competitors.
From the survey, Hero bikes are affordable.
From the survey, Hero customers are satisfied with after sale service provided by
PROVIDENT MOTORS.
From the survey hero company advertisement influenced more on the customer to
purchase the hero bikes.
From the survey, I came to know that from 100 customers 92 customers are
comfortable with Hero bikes.
From the survey 98% of the consumers will recommend their friends and relatives to
buy the Hero bikes because of its good mileage, good after sale service.
From the survey over all Hero bikes are good for mileage; Hero Company has
concentrated on low income consumers.
RNS FIRST GRADE COLLEGE Page 87
CHAPTER 5
SUMMARY OF FINDINGS & CONCLUSION
FINDINGS
From the above survey, it was found that most of the provident motors customers are
satisfied with the overall selling process of dealers.
From the survey, it was found that male consumers are more than female consumer.
From the survey, it was found that Pvt. Employees are the more customers to Hero
bikes.
From the survey, it was found that the Hero bikes are purchased because it has less
maintenance cost.
From the survey, it was found that the Hero Company is concentrated on mileage
rather than speed of the bike.
From the survey the consumer of Hero Company are less income people because
Hero bike has very less cost of spare parts.
From the survey the Hero Company gives best offers then the competitors.
From the survey, Hero bikes are affordable.
From the survey, Hero customers are satisfied with after sale service provided by
PROVIDENT MOTORS.
From the survey hero company advertisement influenced more on the customer to
purchase the hero bikes.
From the survey, I came to know that from 100 customers 92 customers are
comfortable with Hero bikes.
From the survey 98% of the consumers will recommend their friends and relatives to
buy the Hero bikes because of its good mileage, good after sale service.
From the survey over all Hero bikes are good for mileage; Hero Company has
concentrated on low income consumers.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 88
CONCLUSION
Once the business has identified its target market-the people most likely to purchase
its goods and services-it may divide the customers further using segmentation
strategies. Customer in this segments share one or more characteristics. Using this
knowledge, the individual responsible for marketing a business develops specific
plans to reach these targeted customers effectively. Segmentation allows companies
to build relationships and loyalty in customers by better providing for their wants and
needs. Although a company could use countless variables to segment its overall
market, there are few variables that are most commonly used for customer
segmentation.
RNS FIRST GRADE COLLEGE Page 88
CONCLUSION
Once the business has identified its target market-the people most likely to purchase
its goods and services-it may divide the customers further using segmentation
strategies. Customer in this segments share one or more characteristics. Using this
knowledge, the individual responsible for marketing a business develops specific
plans to reach these targeted customers effectively. Segmentation allows companies
to build relationships and loyalty in customers by better providing for their wants and
needs. Although a company could use countless variables to segment its overall
market, there are few variables that are most commonly used for customer
segmentation.
Effectiveness of Market Segmentation
RNS FIRST GRADE COLLEGE Page 89
CHAPTER 6
SUGGESTIONS
Provident motors must increase the promotion activity that which helps to
increase the female customers.
It must still improve on its processing time for the installment schemes with easier
forms and better management procuring installment schemes it can reduce on the
time factor.
More and more discount and better gifts help in gaining more customers, the
company should innovative certain buy back schemes and heavy festival offers to
improve its sales.
The pricing of Hero is also a major factor, with the increase in competition,
competitors are doing all they can to improve their sales. Hero should see to it that
the price range is so attractive that it soothes the eye and catches everyone’s
attention.
The fuel efficiency and maintenance must be looked major factors influencing the
purchase of a vehicle. The company’s R&D teams must consider the matter to
speed up its vehicle sales.
Hero must improve on its styling factor and make it more attractive.
Hero must learn know how from foreign companies and even take guidance from
latest expertise in the field of bikes. Bikes designed for the various segments of the
society like the youth, middle aged men and the senior grades should be made
depending on the customer handing capability of the customer. Heavy duty
engines and study body make a life span of the bike more.
Company should focus on the basic aspects like speed and style also.
Recommendations help increase the sales and profile of the company. With
increased competitors are seeing to it that they capture the buyers and impress on
them that they are the best.
RNS FIRST GRADE COLLEGE Page 89
CHAPTER 6
SUGGESTIONS
Provident motors must increase the promotion activity that which helps to
increase the female customers.
It must still improve on its processing time for the installment schemes with easier
forms and better management procuring installment schemes it can reduce on the
time factor.
More and more discount and better gifts help in gaining more customers, the
company should innovative certain buy back schemes and heavy festival offers to
improve its sales.
The pricing of Hero is also a major factor, with the increase in competition,
competitors are doing all they can to improve their sales. Hero should see to it that
the price range is so attractive that it soothes the eye and catches everyone’s
attention.
The fuel efficiency and maintenance must be looked major factors influencing the
purchase of a vehicle. The company’s R&D teams must consider the matter to
speed up its vehicle sales.
Hero must improve on its styling factor and make it more attractive.
Hero must learn know how from foreign companies and even take guidance from
latest expertise in the field of bikes. Bikes designed for the various segments of the
society like the youth, middle aged men and the senior grades should be made
depending on the customer handing capability of the customer. Heavy duty
engines and study body make a life span of the bike more.
Company should focus on the basic aspects like speed and style also.
Recommendations help increase the sales and profile of the company. With
increased competitors are seeing to it that they capture the buyers and impress on
them that they are the best.
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