Racing past the Barriers

The Success of the Apache Motorcycle in India

Submitted to: Submitted By:

Mr. Ahsan Durrani Badar Salam Kayani - 1848 Jibran Ali 31st March 2013

1. What were the former characteristics of the market in India?

Former Characteristics of Indian Market: Size: Two-wheelers have been the main means of transport in India accounting for over 70% of the vehicle population. Growth Rate: Modest 0.1million vehicles in early 1970s. Supplier to the Industry (Their relative power): local producers successfully lobbied with the government to maintain the status quo. It was marketing heaven for the existing producers. Competitive substitute products ( their relative power): In the early 1990s, Bajaj, the leading two-wheeler company had a waiting list that was 26 times the companys annual output. Manufacturing and distribution: Production capacities were limited, a market where licenses were controlled and were few and far between, Social and economic conditions affecting the industry: Customers waited uncomplainingly for long periods (extending to a year and beyond) after full payment to collect their set of wheels. It wasnt uncommon to see an entire family of four (or even five) carrying several bags making their way around the busy roads on the two wheels Foreign exchange deficit, Barriers to entry: Imports were restricted, foreign investment was not allowed.

2. How was the market changing?

Indian government opened up the market in the early 1990s, It was the opening up of floodgates, leading to a boom in foreign investment, technical collaborations, and new media, all of these factors paving the way for a new era of consumerism. The most tangible, visible and much needed change took place in the Auto sector, with new investment and increased capacity kick starting the growth. Greater choice, customization for different road conditions, better distribution, and price tiers to suit a range of budgets, All contributed to unimaginable growth rates. With increasing competition, the balance of power shifts to the consumer. Marketing then has to shift from push to pull. From selling and product focused marketing, the market moves to a need for brands that connect with consumer emotion. The Indian market jumpstarted from a world of controlled undersupply and in no time the consumer quickly evolved, perhaps even ahead of the Indian marketer. The Indian 2 wheeler market was waiting for brands like Apache that understood this and met more than just the need for great mileage and reliability.

3. What roles did qualitative research and quantitative research

fulfill?
Qualitative: Qualitative research has uncover/explore the need structure of the market. Quantitative: Quantitative research identified the need based segmentation to validate the need structure and measure the sizes of the need segments. Roles of Qualitative & Quantitative Mapping and measuring of existing brands on the needs landscape helped to identify where the opportunity lie.

Concepts were developed and tested and THEN finally the technical design team given the direction to develop/ identify a suitable product that expressed the desired brand positioning.

This represented a complete paradigm shift in the method of client working and thinking, where most of the earlier launches (the successful ones as well as not so successful) had emerged from the engineering and draftsman drawing boards.

4. What insights are drawn from existing theory?

Modernity is at the heart of the category. The market had moved away from the family orientation scooter days. Consumers were looking for contemporary expression in keeping with the optimism and hope of the new generation. This had to be reflected in both the design and the emotive proposition. Stability, reliability and trust, which were critical strengths of the TVS corporate brand were now taken for granted, important to have, but no longer enough to which to build a differentiated proposition. The new brand would therefore have to stand alone; in fact perhaps lead the shift of TVS image towards modernity. And to succeed in this direction, there was a need to alter the thinking and functioning of existing stalwarts within the company, with their strong technical orientation.

5. Explain the concept of The NeedScope System. What does the

marketing model and archetypal framework.

Two concepts form the theoretical basis of NeedScope A Marketing Model Archetypal framework

Marketing Model: The Marketing Model describes how brands and needs are two sides of an equation and should fit together. Needs are DE-layered into three levels. consumers have needs at all levels

Functional Needs (Rational Layer): It is the outer and most easily accessible layer of consumer needs and it is satisfied by the functional benefits that the product delivers. It serves as a screener, the first stop, which if not satisfied, will keep the brand out of the consumers consideration set.

Identity Needs (Sociology): The need to identify with particular groups in society. These needs are met by the social values or character of the brand a brand for young people, for women, upscale, etc.

Emotive Needs (Relationship): These are the core drivers of brand choice, the engine that powers the consumers relationship with the brand.

Symbology, Social Values, Product Features:

Archetypal Framework: Two axes are the fundamental anchors of this framework. Horizontal Vertical Horizontal: The horizontal is the I vs. We axis. The right side represents the drive for individualism and self assertion. This is the need to stand out, to feel superior, to be admired and to stay ahead of others. The left is about the fundamental sense of belonging the need for acceptance, togetherness, friendship and warmth Vertical: The vertical dimension divides the model into the extroverted and introverted poles. The top is about energy directed outwards release, stimulation, freedom. The bottom is about energy that is inwards more contained and controlled and therefore less visible. While these are polar opposites, there are no hierarchies or negatives. The space represents alternative strategies that consumers use to resolve their needs. It must also be pointed out that this is a needs rather than a consumer framework. Consumers are multi-faceted and have multiple needs, depending on the context of the category and occasion Powerful brands are archetypal in nature. This is what enables them to connect at the deepest level, inspiring consumers to behave often irrationally. They, build lasting commitments and relationships.

They speak a symbolic language that is not made of words and therefore crosses barriers of language, religion and politics - a language that unites, that taps into universally shared hopes, dreams and needs.

That is what makes them the global icons they are!

6. What problems was TVS company facing in marketing its two

wheelers? What made them change their thinking?

Problems: Increasing competition, the balance of power was shifting to the consumer. Marketing then has been shifting from push to pull. From selling and product focused marketing, the market moves to a need for brands that connect with consumer emotion. Brand that understands the needs Product Customization/Consumerization Alternative way of segmenting the market. Motorcycles until the mid-1990s never really had a strong volume base. Heavy and difficult to manage, High Fuel consumption / Fuel inefficiency, Quite unsuitable except for the very niche law enforcement and the macho exceptions that opted for a motorbike over the practical scooter. Segmentation of the market was primarily on price tiers. Branding was limited only to the corporate values of the company, All communication emphasized functional performance. There was very rare use of celebrity endorsements to add humanity and appeal to factual advertising.

Changing Effects: Increased number of choices, several models at all price tiers and the absence of any runaway new successes in five years led to an erosion of the TVS leadership position. From being the market leader, TVS slipped to the number three position. There was a clear and immediate need to rejuvenate and to explore new opportunities. TVS did what all auto marketers do best turn to the engineering and design team for a solution. Several new products were designed and tested, some were even found superior in product clinics and launched, but the market response was lack luster at best. With no opportunity to create a new price point and functional performance not breaking any new boundaries, the time had come to turn in another direction.

7. What were the six needs that were identified through

quantitative research. What were the characteristics of each? What segment was selected by TVS and why?
Identification of Six Needs: There were six need states identified and each need state was detailed on all layers of needs as well as other demographic and behavioral parameters to enable targeting. Liberation Potency Belonging Exclusivity Compensation Efficiency 21% 28% 12% 13% 13% 13%

Characteristics Of Each Need:

Segment selected by TVS and Why: The size of the need states indicates the dynamic shift of the market towards more modernity and individualism. 62% of the market is weighted towards self expression and status needs. The TVS brands were all clustered in the lower part of the affiliative section of the map. Clearly, all of them were drawing imagery and symbology from the affiliative, reliable image of the corporate brand. The position of the TVS brands indicated sub-optimal utilization of the portfolio and the absence from the more dynamic and growing part of the market was a cause of concern. TVS clearly had to get back into the action

Potency & Liberation: Being large and growing were identified as the opportunity. An in-depth need state- brand fit analysis showed that Liberation was more optimal target market rather than Potency for several reasons. Potency, while larger and exciting, already had a formidable competitor in Pulsar. The Potency need state with its macho, rugged individualism was just too distant to be targeted credibly with TVSs affiliative imagery. Liberation had a younger skew, which opened up the opportunity to target a new social group the first time bike buyer. With the market size growing, the profile of the buyer was getting younger and this segment was expected to grow even further as the shift of the older middle class consumers towards four-wheelers had begun.

Is cool a relevant concept for this product? Positive; because Apache is targeted towards young adolescence and they have a Cool Attitude, Unique behavior, Excited by Nature, Winners Feeling and Attributes, WOW kind of feel. Also the Liberation segment selected by TVS for Apache had a younger skew, which opened up the opportunity to target a new social group the first time bike buyer. Liberation evokes the heady kick and excitement of youth, the exciting discovery of adulthood and the bike is integral as a source of pleasure. Liberation need also extended to the Young at Heart rather younger skew. For the young man, the motorbike is a symbol to flaunt his adult status (personified as a girlfriend for fun, romance). With older men it is about recapturing moments gone by, the wish for evergreen enduring youthfulness. The social values of the Liberation need state are therefore younger men in the golden period between boys and adult men. The need has a strong peer context, typical to that life stage. The need for affiliation, togetherness is also reflected in the relationship with the bike - a buddy to share the fun with.

8. Does Apache have the ingredients to be cool and is the

concept of consumer Tribe relevant?

Ingredients to be Cool: Symbolism Living life in the moment. Targeting that part of every man that brings back the wonder years of Freedom, of Irresponsibility, of living a sense of release, exploration and the anticipation that the world is waiting for you! For the newly

initiated, the promise of discovering a new world, for the young at heart, the recapturing of a time gone by, a retreat to Ladland!! About living life to the fullest and making most of the moment. Social values Unattached, young, popular men with lots of friends and popular among girls Functional promise stylish looks, really cool accessories, power and pick up, lightness to reflect the mood, easy maintenance. Reason to believe Driven by those who young people identify with and look like (not celebrities). The brand had to be the rage of the moment; something that everyone is talking about. Advertising The tonality is irreverent, but inoffensively so. Fun, easygoing, defying conventions and conservatism without becoming rebellious or edgy. The television commercial is set to a rap tune, but the words are in an Indian language in tune with the current youths desire for a blend of the international with the Indian a distinct flavor of modern India. The strongly evocative emotional proposition was also translated into trendy style and irresistible features.

Concepts of Consumer Tribe Tribe: A group of people with deep interpersonal connections built through shared experience, rituals, and traditions. Consumer Tribe: Group of people emotionally connected by similar consumption values and usage, who use the social linking value of product an d services to create a community and express identity.

Concepts of Consumer Tribe Relevancy: With increasing competition, the balance of power was shifted towards the consumer and Marketing then has to shift from push to pull. From selling and product focused marketing, the market moves to a need for brands that connect with consumer emotion. The Indian 2 wheeler market was waiting for brands like Apache that understood this well and met more than just the need for great mileage and reliability. Apache decision exemplifies making and bold a

willingness to break away from the conventional way of doing things. TVS recognized that the market had moved to a new level of consumerization that demanded brand connections to be built at a deeper level. It was not just about bold decision making and creating the right concept. The execution and implementation remained true to the archetypal positioning and delivered the perfect tonality.