SUMMER TRAINING PROJECT REPORT

ON

”MARKETING STRATEGIES OF MARUTI

SUZUKI"

Under the Guidance

SUBMITTED TO: SUBMITTED By:

Mr. Ashish Kumar Singh Sumit Singh
Roll No.1703370031

RAJ KUMAR GOEL INSTITUTE OF TECHNOLOGY

Ghaziabad-033

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 DECLARATION

I, Sumit Singh the student of Master of Business Administration (MBA)

– semester III rd in RAJ KUMAR GOEL INSTITUTE OF TECHNOLOGY

Ghaziabad-033 (2017-19) hereby declare that I have completed this

project on ”MARKETING STRATEGIES OF MARUTI SUZUKI" This

information submitted is true & original to the best of my knowledge.

Student’s Signature
(Sumit Singh)

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 ACKNOWLEDGEMENT

I honoured to present this training report titled “”MARKETING

STRATEGIES".

I would also like to thanks Dr. Vibhuti Tyagi (H.O.D), RAJ KUMAR GOEL

INSTITUTE OF TECHNOLOGY GHAZIABAD-033 I am greatly indebted to

Mr. Ashish Kumar Singh (Project guide), For her supportive attitude,

constant encouragement and suggestion from time to time.

I feel short of words in impressive my sincere regards and gratitude to

my parents, affection, advice, encouragement, helping nature and

immense dedication towards the academic field was instrumental in

streamlining this work.

At the end I feel indebted to our almighty God, who blessed and enable

me to complete.

(Sumit Singh)

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 TABLE OF CONTENT

1. INTRODUCTION OF THE COMPANY

2. AWARDS & ACHIEVEMENTS

3. OBJECTIVE OF THE STUDY

4. RESEARCH METHODOLOGY

5. INTRODUCTION

6. FINDINGS

7. DATA COLLECTION & INTERPRETATION

8. CONCLUSION

9. LIMITATIONS

10. BIBILIOGRAPHY

11. ANNEXURE

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 INTRODUCTION OF THE COMAPANY
MARUTI UDYOG LIMITED

Maruti is India's largest automobile company. The company, a joint venture with

Suzuki of Japan, has been a success story like no other in the annals of the Indian

automobile industry.

Today, Maruti is India's largest automobile company. This feat was achieved by the

missionary zeal of our employees across the line and the far-sighted VIsion of our

management.

The Company Mission:

To proVIde a wide range of modern, high quality fuel efficient vehicles in order to

meet the need of different customers, both in domestic and export markets.

The Company VIsion:

We must be an internationally competitive company in terms of our products and

serVIces. We must retain our leadership in India and should also aspire to be among

the global players.

Their focus is on:

 Building a continuously improVIng organisation adaptable to quick changes

 ProVIding value and satisfaction to the customer

 Aligning and fully involVIng all our employees, suppliers and dealers to face

competition

 Maximising Shareholder's value

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  Being a responsible corporate citizen

At Maruti, they have a clear perspective on manpower. They see it as a unique

resource, in the sense that optimal productviIty of other resources depends largely on

the way human resources are utilised. The basic philosophy of management that

underlies the Maruti culture is that all employees of the company should be moulded

into a team which then strives as one, to achieve commonly shared company goals and

objectives. To make this philosophy tenable, the Company takes several initiatives.

Inputs are sought from employees at all levels. They believe that everyone should

contribute to the formulation of company policies, goals and objectives. Secondly, at

Maruti, they encourage leadership in the best sense of the word. According to us, a

leader is one who must be impartial, must have the ability to rise above his own

subjectviIty, and, most importantly, must practice what he preaches.

They understand that the process of creating a sense of belonging that all employees

can identify with is a lengthy one. To ensure that this translates into concrete reality,

they have taken several simple but specific and well thought out measures. The first

step in this direction has been the introduction of a common uniform for all

employees. Another measure is the creation of a common canteen where all

employees have lunch, stand in common queues, and sit on the same table. Common

toilets, common transport and similar facilities for all levels of employees are other

measures that reinforce their emphasis on genuine equality in the workplace.

At Maruti They do not believe in the notion of organisational hierarchies. As a matter

of fact, the management structure and systems in Maruti have been designed to

promote decentralisation of authority. Maruti has a horizontal management structure

with only four functional levels of responsibility to facilitate quicker decision making.

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Another focus area of the Maruti culture is the maintenance of a smoothly functioning

communication network. Maruti believes that communication channels between

labour and management cannot simply consist of haVIng a labour representative on

the Board of the Company. They have faith in the ability of labour to effectively

participate in management and make constructive suggestions. To encourage this, they

ensure that there is a thorough dissemination of information at all levels, through

newsletters or VIa a letter from the Chief Executive to all employees. Meetings with

the Union are held regularly, and programmes being contemplated by the Company

are discussed with the Union. The Sahyog Samiti, a collection of representatives of

non-unionised employees, training programmes in Japan, Quality Circles,

productivity-linked incentive schemes, and an ethos of discipline and teamwork, all

contribute to the Maruti culture.

Several measures of performance have made amply clear that Maruti has established a

truly healthy work culture. They have met all project and performance targets since

inception. Their productviIty levels are constantly improVIng. The Company has had

good labour relations with employees from the very beginning, and they have been

successful in the export market. Yet, the Maruti culture is one that does not believe in

resting on its laurels. They adhere to the spirit of Kaizen, which states that constant

improvement is always possible. The most basic tenet of productviIty that they hold

dear is that " Today should be better than Yesterday and Tomorrow should be better

than Today".

Maruti Udyog Limited (MUL) was established in Feb 1981 through an Act of

Parliament, to meet the growing demand of a personal mode of transport caused by

the lack of an efficient public transport system.

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Suzuki Motor Company was chosen from seven prospective partners worldwide. This

was due not only to their undisputed leadership in small cars but also to their

commitment to actively bring to MUL contemporary technology and Japanese

management practices (which had catapulted Japan over USA to the status of the top

auto manufacturing country in the world).

A licence and a Joint Venture agreement was signed between Government of India and

Suzuki Motor Company (now Suzuki Motor Corporation of Japan) in Oct 1982.

The objectives of MUL then were:

 Modernization of the Indian Automobile Industry.

 Production of fuel-efficient vehicles to conserve scarce resources.

 Production of large number of motor vehicles, which was necessary for

economic growth.

Core Value

 Customer Obsession

 Fast, Flexible and First Mover

 Innovation and CreatviIty

 Networking and Partnership

 Openness and Learning

VIsion

The leader in the India Automobile Industry, Creating Customer Delight and

Shareholder’s Wealth; A pride of India”

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Technological Advantage

We have introduced the superior 16 * 4 Hypertech engines across the entire Maruti

Suzuki range. This new technology harnesses the power of a brainy 16-bit computer to

a fuel-efficient 4-valve engine to create optimum engine delivery. This means every

Maruti Suzuki owner gets the ideal combination of power and performance from his

car.

Our other innovation has been the introduction of Electronic Power Steering (EPS) in

select models. This results in better and greater maneuverability. In other words, our

cars have become even more pleasurable to drive.

Production/R&D

Spread over a sprawling 297 acres with 3 fully-integrated production facilities, the

Maruti Udyog Plant has already rolled out over 4.3 million vehicles. In fact, on an

average, two vehicles roll out of the factory every minute. And it takes on an average,

just 14 hours to make a car. More importantly, with an incredible range of 11 models

available in 50 variants, there's a Maruti Suzuki made here to fit every car-buyer's

budget. And dream.

Production Milestones

1st vehicle produced, December 1983

1,00,000 vehicles produced by August, 1986

5,00,000 vehicles produced by June, 1990

10,00,000 vehicles produced by March, 1994

15,00,000 vehicles produced by April, 1996

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20,00,000 vehicles produced by October, 1997

25,00,000 vehicles produced by March, 1999

30,00,000 vehicles produced by June, 2000

35,00,000 vehicles produced by December 2001

40,00,000 vehicles produced by April, 2003

45,00,000 vehicles produced by April, 2004

AWARDS

2011
Number one in JD Power SSI for the second consecutive year
Number one in JD Power CSI for the sixth time in a row - the

only car to win

it so many times
M800, WagonR and Swift topped their segments in the TNS

Total
Customer Satisfaction Study
Leadership in the JD Power Initial Quality Study - Alto

number one in its

segment for the 2nd time in a row, Esteem number one in its

segment for
the 3rd year in a row, Swift number one in the premium

compact segment
WagonR and Esteem top their segments in the JD Power

APEAL study
TNS ranks Maruti 4th in the Corporate Reputation Strength

(CSR) study
(#1 in Auto sector)-Feb 05
Maruti bagged the "Manufacturer of the year" award from

Autocar-CNBC
( 2nd time in a row)-Feb 05
First Indian car manufacturer to reach 5 million vehicles sales

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 Business World ranks Maruti among top five most respected

companies in
India-Oct 04
Maruti ranked among top ten (Rank7) greenest companies in

India by
Business Today - Sep '04

2009
Maruti Suzuki was No. 1 in Customer atisfaction, No. 1 in

Sales Satisfaction No.1 in Product Quality (Esteem and Alto)

and No. 1 in Product Appeal (Esteem and Wagon R)

No. 1 in Total Customer Satisfaction (Maruti 800, Zen and

Alto)
Business World ranked us among the country's five most

respected companies
Business World ranked us the country's most respected

automobile company
Voted Manufacturer of the year by CNBC
Voted one of India's Greenest Companies by Business Today-

AC Nielson ORG-MARG

2006
Maruti 800, Maruti Zen and Maruti Esteem make it to the top

10 automotive brands in "Most Trusted Brand survey 2003"

J D Power ranked 3 models of Maruti on top: Wagonr, Zen and

Esteem
Maruti 800 and Wagonr top in NFO Total Customer

Satisfaction Study 2003.

MUL tops in J D Power CSI (2001) for 4th time in a row

2001
MUL tops in J D Power CSI (2001) for 2nd time in a row:

another international first

2000
Maruti bags JD Power CSI - 1st rank; unique achievement by

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 market leader anywhere in the world

1999
MSM launched as model workshop in India; achieves highest

CSI rating.
Central Board of Excise & Customs awards Maruti with

"Samman Patra", for contribution to exchequer and being an

ideal tax assessee

1998
CII's Business Excellence Award

1996
Maruti wins INSSAN award for "Excellence in Suggestion

Scheme"
Awarded the Star Trading House status by Ministry of

Commerce

1994-95
Engineering Exports Promotion Council's award for export

performance

1994
Best Canteen award among Haryana Industries as part of

employee welfare

1992-93
Engineering Exports Promotion Council's award for export

performance

1991-92
Engineering Exports Promotion Council's award for export

performance

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 WHY MARUTI SUZUKI

The Quality Advantage

A car is an engineering product, only as good as the technology used to make it.

Actual users of our technology are saying something very clearly Maruti Suzuki

is No.1 in quality:

Maruti Suzuki owners experience fewer problems with their vehicles than any other

can manufacturer in India (J.D. Power IQS Study 2004). The Alto was chosen No.1 in

the premium compact car segment and the Esteem in the entry level mid-size car

segment across 9 parameters.

The J.D. Power APEAL Study 2004 proclaimed the Wagon R. No. 1 in the

premium compact car segment and the Esteem No.1 in the entry level mid-size

car segment. This study measures owner delight in terms of design, content,

layout and performance of vehicles across 8 parameters.

Maruti Suzuki has a sales network of 307 state-of-the-art showrooms across 189

cities*, with a workforce of over 6000 trained sales personnel to guide our

customers in finding the right car. Our high sales and customer care standards

led us to achieve the No.1 nameplate in the J.D. Power SSI study 2004. The SSI

study measures sales satisfaction across 6 parameters: deal received, paperwork,

dealer facility, salesperson, delivery timing and delivery process. Maruti Suzuki

has not only got the No.1 nameplate in the J.D. Power SSI study 2004, but also

ranked way above the industry average (Maruti Suzuki was at 784 while

industry average was at 760). What is significant is that it was ranked above

Skoda, Ford, Chevrolet, Mitsubishi and Hyundai.

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To be really happy with the car you own, it should have a reliable serVIce

network at hand and within easy reach. Their 1036 city strong serVIce network

is equipped to serVIce 20,000 vehicles a day. No wonder Maruti Suzuki has

been awarded the No.1 nameplate in customer satisfaction in India for the fifth

year in a row, a feat unprecedented for any automobile market leader in the

world.

In the J.D. Power CSI study 2004, Maruti Suzuki scored the highest across all 7

parameters: least problems experienced with vehicle serVIced, highest serVIce

quality, best in-serVIce experience, best serVIce delivery, best in-serVIce

experience, most user-friendly serVIce and best serVIce initiation experience.

In fact, 92% of Maruti Suzuki owners feel that work gets done right the first time

during serVIce. The J.D. Power CSI study 2004 also reveals that 97% of Maruti

Suzuki owners would probable recommend the same make of vehicle, while 90%

owners would probable repurchase the same make of vehicle.

A Buying Experience Like No Other

Maruti Suzuki has a sales network of 307 state-of -the-art showrooms across 189

cities, with a workforce of over 6000 trained sales personnel to guide our customers in

finding the right car. Our high sales and customer care standards led us to achieve the

No.1 nameplate in the J.D. Power SSI Study 2004.

Quality SerVIce Across 1036 Cities

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In the J.D. Power CSI Study 2004, Maruti Suzuki scored the highest across all 7

parameters: least problems experienced with vehicle serVIced, highest serVIce

quality, best in-serVIce experience, best serVIce delivery, best serVIce adVIsor

experience, most user-friendly serVIce and best serVIce initiation experience.

92% of Maruti Suzuki owners feel that work gets done right the first time during

serVIce. The J.D. Power CSI study 2004 also reveals that 97% of Maruti Suzuki

owners would probably recommend the same make of vehicle, while 90% owners

would probably repurchase the same make of vehicle.

One Stop Shop

At Maruti Suzuki, you will find all your car related needs met under one roof.

Whether it is easy finance, insurance, fleet management serVIces, exchange- Maruti

Suzuki is set to proVIde a single-window solution for all your car related needs.

The Low Cost Maintenance Advantage

The acquisition cost is unfortunately not the only cost you face when buying a

car. Although a car may be affordable to buy, it may not necessarily be

affordable to maintain, as some of its regularly used spare parts may be priced

quite steeply. Not so in the case of a Maruti Suzuki. It is in the economy

segment that the affordability of spares is most competitive, and it is here where

Maruti Suzuki shines. The recent Auto car Survey conducted in August 2004

bears testimony to this fact. In the Maruti Suzuki stable, the Omni has the

lowest aggregate cost of spares followed by the Maruti-800. The Maruti-800 has

the cheapest spares of any Indian car with a basket of just Rs. 23,422. In the

Lower Mid-size segment as well, price-consciousness is very high, where the

15
cars have to be not only affordable on purchase price but also need to combine

quality, drivability and have comfortable interiors. In this segment, the Maruti

Suzuki Versa has scored particularly well with the lowest cost of spares in the

segment. In the Upper Mid-size segment, the Maruti Suzuki Baleno has the

segment's lowest prices on a majority of the spares.

Lowest Cost of Ownership

To be really happy with the car one owns, it should be easy on the pocket to buy

and to run-which is why the cost of ownership is so important. And here again, a

Maruti Suzuki is a clear winner, as shown by the recent J.D.Power CSI study

2004. It is clear that a Maruti Suzuki delights you even when you run it for

years. The 6 highest satisfaction ratings with regard to cost of ownership among

all models are all Maruti Suzuki vehicles: Zen, Wagon R, Esteem, Maruti 800,

Alto and Omni. They are proud to have the lowest cost of operation / km

(among petrol vehicles) - the top 5 models are all Maruti Suzuki models: Maruti

800, Alto, Zen, Omni and Wagon R.

Employee Quality Measures

Kaizen is based on the concept of making incremental improvements in our products.

It incorporates a series of continuous small and simple improvements, which aim at

involVIng employees at all levels.

The Suggestion Scheme is based on the same principle. Under this scheme, employees

are encouraged to make suggestions for improvement in any area of our operation.

Over 50,000 suggestions are received from employees every year.

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Maruti has won the First place in "Excellence in Suggestion Scheme Contest 2003",

which is the 6th consecutive award won in as many years. This contest is organized by

Indian National Suggestion Schemes Association (INSSAN). Since 1998 Maruti has

won this award 10 times.

"Quality Circles" are groups of five to eight members from a particular work area who

work as a team to identify priorities and solve work related problems in the area.

We believe that it is this unwavering commitment to quality that will lead to the

further growth of the organization as competition increases.

ISO 9001:2000

At Maruti, our approach to quality is in keeping with the Japanese practice--"build it

into the product". Technicians themselves inspect the quality of work. SuperVIsors

educate and instruct technicians to continually improve productviIty and quality. The

movement of quality indicators is reVIewed in weekly meetings by the top

management.

In 2001, Maruti Udyog Ltd became one of the first automobile companies

anywhere in the world to get an ISO 9000:2000 certification. AV Belgium, global

auditors for International Organization for Standardisation(ISO), certified Maruti after

a four day long audit, covering varied parameters like Customer Focussed

organisation, Leadership, Involvement of people, Process approach, System approach

to Management, Continual improvement, etc.

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In May 1995, Maruti got ISO 9002 certification. The audit for this covered quality

assurance in production, installation, marketing and sales as well as after sales

serVIces. We were also one of the first companies in the world to pioneer ISO 9000

certification for our dealers.

In October 1993, MUL passed the Conformity Of Production (COP) Audit, which

is based on a European Union Directive. This authenticated our quality systems and

testing facilities for export to Europe.

Their emphasis on total quality has meant that today they are in a position to guide

vendors and dealers in establishing and consolidating their indviIdual quality systems.

This commitment to quality has ensured a consistently satisfying product and world-

class sales and after-sales serVIces.

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TS16949:2002 - A new feather was added recently in Maruti’s cap in the field of

quality when the Quality Management System of its Press Shop & associated

functions (collectively termed as Press Function) got certification for conformance to

the requirements of TS16949:2002 standard.

The need for TS certification of Press Function had its genesis in the prestigious

project that Maruti earned for the supply of stamped panels to General Motors India

for one of its forthcoming models.

As a part of Quality system requirements, GM requires all its suppliers to be certified

to either ISO TS 16949 or QS 9000.

These standards address Quality System requirements, which are particularly specific

to the automotive industry and requires an organization to be in compliance with ISO

9000 systems as a basic requirement. However, whereas QS 9000 would become

defunct and cease to exist after Dec 2006, TS 16949 is going to be the standard of the

future.

The TS 16949 standard, brought out by ISO in the year 1999, is an extension of the

ISO 9001:2000 standard that prescribes Quality management system requirements that

are specifically applicable to the automotive industry.

TS 16949 has gained high popularity and almost all major automobile players across

the globe including GM, Ford, Daimler Chrysler, Nissan, Honda are embracing &

promoting it.

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ISO 9001:2000

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 THEORITICAL PERSPECTIVE

Consumer is strictly, the ultimate consumer of a product, the ultimate user of a

product; the person who derives the satisfaction or the benefit offered. The 'consumer'

is not necessarily the customer, since there are often 'customers' in the buying/

distribution chain; moreover, the consumer is frequently not the person who makes the

buying decision; for instance, in the case of many household products, where the

housewife may make the purchase but consumption or use is by the whole family.

'Consumer' is not normally applied to the purchase of industrial goods and serVIces

where the customer is usually a corporate body. Nevertheless, consumable goods are

sold to industry for corporate purposes and the consumers of these goods can be

identified for marketing practice.

Consumer behaVIor is the study of buying habits or patterns of behaVIour of

consuming public either in general or in specific groups.

THE BUYING PROCESS

The complexity inherent in understanding consumer behaVIour has led to the

construction of models of the buying process which indicate the stages through

which the consumer passes from the time he or she first becomes aware of a

need for a product or serVIce to the time when a product is purchased, a brand

selected, and the consumer evaluates the success of his purchase decides

whether to buy that particular product and / or brand again. It the same time,

such models usually indicate the social and psychological forces which shape

the potential buyer's action at each stage in the process. The two principal aims

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of such model building are the prediction of future behaVIor based on

measurement of relevant variable and the explanation of this behaVIor in terms

of theoretically relevant constructs. The starting point for understanding

the buyer is the stimulus-response model shown below

Marketin Other Buyer's Buyer's decision Buyer's decisions

g stimuli stimuli Characteristi process

cs

Product Economic Cultural Problem Product choice

recognition
Price Technologic Social Brand choice

al Information
Place Personal Dealer choice
search
Political
Promotion Psychological Purchase timing
Evaluation
Cultural
Purchase amount
decision

Post-purchase

behaVIor

Stages in Buying Decision Process

Need Informati Evaluation Purchase Post-

recognitio on search of decision purchase

n alternatives behaVIor

The consumer passes through five stages : Problem recognition information

search, evaluation of alternatives purchase decision and post-purchase

behaVIor. Clearly the buying process starts long before the actual purchase and

has consequences long after the purchase.

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This model implies that consumers pass through all five stages in buying a

product. But this is not the case, especially in low-involvement purchase.

Consumers may skip or rreverse some stages. Thus a woman buying her regular

brand of toothpaste goes directly from the need for toothpaste to the purchase

decision, skipping information search and evaluation. However, we have already

used the model in above, because it captures the full range of consideration that

arise when a consumer facer a highly involVIng new purchase. We will allude

again to Linda Brown and try to understand how she became interested in

buying a laptop computer and the try to understand how she became interested

in buying a laptop computer and stages she went through to make her final

choice.

MAJOR FACTORS INFLUENCING BUYING BEHAVI or

Cultural

Social

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 Culture Reference Personal

group Age and life- Psychological

Subculture
cycle stage Motivation
Family
Social Class
Occupation Perception
Roles and

statuses Economic Learning

circumstances Buyer
Beliefs and

Lifestyle attitudes

Personality and

self-concept

Rogers model for the adoption and diffusion of innovations Innovation

Adoption CURVE

The innovation adoption curve of Rogers is a model that classifies adopters of innovations into

various categories, based on the idea that certain indviIduals are ineVItably more open to adaptation

than others. Is is also referred to as Multi-Step Flow Theory or Diffusion of Innovations Theory.

Innovators

Brave people, puling the change. Innovators are very important communication.

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Early Adopters

Respectable people, opinion leaders, try out new ideas, but in a careful way.

Early Majority

Thoughtful people, careful but accepting change more quickly than the average.

Late Majority

Skeptic people, will use new ideas or products only when the majority is using it.

Laggards

Traditional people, caring for the "old ways", are critical towards new ideas and will only accept it if the

new idea has become mainstream or even tradition.

The diffusion of innovations curve (innovation adoption curve) of Rogers is useful to remember that

trying to quickly and massively conVInce the mass of a new controversial idea is useless. It makes more

sense in these circumstances to start with conVIncing innovators and early adopters first. Also the

categories and percentages can be used as a first draft to estimate target groups for communication

purposes.

Diffusion research focus was on five elements: 1) the characteristics of an

innovation which may influence its adoption; 2) the decision-making process that

occurs when indviIduals consider adopting a new idea, product or practice; 3) the

characteristics of indviIduals that make them likely to adopt an innovation.

TARGET MARKETING

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Target Marketing involves breaking a market into segments and then concentrating

your marketing efforts on one or a few key segments.

The beauty of target marketing is that it makes the promotion, pricing and distribution

of your products and/or serVIces easier and more cost-effective. Target marketing is

the selection of customers you wish to serVIce. The decisions involved in it are

 Which segments to target

 How many products to offer

 Which products to offer in which segments

There are three steps to targeting:

 Market segmentation

 Target choice

 Product positioning

One of the first things you need to do is to refine your product or serVIce so that you

are NOT trying to be 'all things to all people’.

Next, you need to understand that people purchase products or serVIces for three basic

reasons:

 To satisfy basic needs.

 To solve problems.

 To make themselves feel good.

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The next step in creating an effective marketing strategy is to zero in on your target

market.

Target marketing is one of corporate America's most effective business strategies. The

idea is to increase sales by first identifying, and then targeting smaller, yet more

profitable customer groups within the total market.

Four Ways to Identify Target Markets

1. Geographic: The location, size of the area, density, and climate zone of

your customers.

2. Demographics: The age, gender, income, family composition and size,

occupation, and education of your customers.

3. Psychographics: The general personality, behaVIor, life-style, rate of

use, repetition of need, benefits sought, and loyalty characteristics of your

customers.

4. BehaVIors: The needs they seek to fulfill, the level of knowledge,

information sources, attitude, use or response to a product of your

customers.

One of the best ways to identify your target market is to look at your existing

customer base. Who are your ideal clients? What do they have in common? If you do

not have an existing customer base, or if you are targeting a completely new audience,

speculate on who they might be, based on their needs and the benefits they will

receive. Investigate competitors or similar businesses in other markets to gain insight.

TARGET MARKETING

27
  Who are your best customers? Where should you direct your marketing

actviIties?

 Where and how should you allocate your advertising and promotional efforts?

Target Marketing, proVIdes Focus for your business. It helps to establish

critical Operational goals and defines what must be done to achieve them

What Customers Want

 Marketing is more than an actviIty, it is an attitude

 Instead of trying to get customers to buy what the firm likes to make, or

happens to have on hand, the marketing oriented firm tries to produce or

sell what its customers want which can be sold at a profit.

 Do not simply throw out everything that you now have and replace goods or

production machinery with completely new items.

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  HOWEVER, AS YOU ANALYZE YOUR MARKET AND CUSTOMER

PROFILES, AND SO GAIN AN UNDERSTANDING OF THEIR WANTS,

DESIRES, AND PERCEIVED NEEDS, YOU CAN BEGIN TO

REORIENT YOUR BUSINESS OVER TIME TO TAKE BEST

ADVANTAGE OF THESE NEW INSIGHTS. CONSIDER BOTH THE

SHORT TERM AND LONG-TERM IMPLICATIONS OF DEVELOPING

AND IMPLEMENTING THE RIGHT TARGET MARKETING

STRATEGY FOR YOUR BUSINESS.

Customer Attitudes

 For a long time, people have believed that advertising can be used to change

people's minds about what they want. This is an incredibly difficult process at

best, and an extremely expensive one. Because of these two factors, it is a

process that smaller firms simply cannot afford to pursue. Instead, it is much

more productive for any size firm to tune in to target customer attitudes as they

currently exist. Once they have identified the actual prevailing attitudes, they

can begin to organize company resources needed to constructively address

and satisfy these attitudes the key question is,

"What are the existing customer attitudes?"

With this as an objective, developing an understanding of existing customer

attitudes becomes essential, and their identification becomes an important part

of the marketing process. Once these customer attitudes, needs or preferences

29
are identified, the entire firm can then organize itself to satisfy these needs as

completely and efficiently as possible.

Target Marketing

Comparison of Automobile And Consumer

Durable
At Dealership Level
S.No Attributes Automobile Consumer Durables
1 Turnover High Low

2 Margin 8%-12% 2%-4%

Penetration More in small or large More in Rural areas

3 Level towns or cities or in cities also

Training of Executives get Training

Sales after every specific

4 Executives period As such no training

Co->Distributor-

5 Supply-Chain Co->Dealer->Customer >Dealer >Customer

Discount Depends on Dealer

6 Margin Cartel To Dealer

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 Only Sales man is

there to serve the

7 CSR Proper well organized customer

Customer have to go

Customer get 3free at manufactured

8 ASS serVIce level

Brand Customer first choice is Customer can change

9 Association more pertinent his or her choice

More focus on

Finance &

10 Payment Instantaneous Payment Installment

Post-Sales

11 Follow UP More Very Less

Buying Customer can wait for

12 Procedure new model Instant buying

13 Database Large Few

Brand

14 Transition Single-Tier Multi-Tier

Parent Company &

dealer both give Only from Parent

15 Advertisement advertisement Company

Loyality

16 Programs Yes No

Customer

Satisfaction Well- Defined &

17 Index Organized None

18 Promotion Free SerVIce Camps None

31
 Customer

19 Retention More Very Less

Only free serVIce which

customer can extend

upto 4 years(first 2yr are Annual Maintenance

20 Maintenance free) Contract (AMC)

32
 MARUTI CULTURE

Their employees are their greatest strength and asset. It is this underlying philosophy

that has moulded their workforce into a team with common goals and objectives.

Their Employee-Management relationship is therefore characterized by:

 Participative Management.

 Team work & Kaizen.

 Communication and information sharing.

 Open office culture for easy accessibility

To implement this philosophy, they have taken several measures like a flat

organizational structure. There are only three levels of responsibilities ranging from

the Board Of Directors, DviIsion Heads to Department Heads. Other VIsible features

of this philosophy are an open office, common uniforms (at all levels), and a common

canteen for all.

This structure ensures better communication and speedy decision making processes. It

also creates an enVIronment that builds trust, transparency and a sense of belonging

amongst employees.

For Investors:

Maruti Udyog Limited, a subsidiary of Suzuki Motor Corporation of Japan, has been

the leader of the Indian car market for about two decades. Its manufacturing plant,

located some 25 km south of New Delhi in Gurgaon, has an installed capacity of

3,50,000 units per annum, with a capability to produce about half a million vehicles.

33
The company has a portfolio of 11 brands, including Maruti 800, Omni, premium

small car Zen, international brands Alto and WagonR, off-roader Gypsy, mid size

Esteem, luxury car Baleno, the MPV, Versa, Swift and Luxury SUV Grand VItara

XL7.

In recent years, Maruti has made major strides towards its goal of becoming Suzuki

Motor Corporation's R and D hub for Asia. It has introduced upgraded versions of

WagonR Zen and Esteem, completely designed and styled in-house.

Maruti's contribution as the engine of growth of the Indian auto industry, indeed its

impact on the lifestyle and psyche of an entire generation of Indian middle class, is

widely acknowledged. Its emotional connect with the customer continues.

Maruti tops customer satisfaction again for sixth year in a row according to the J.D.

Power Asia Pacific 2005 India Customer Satisfaction Index (CSI) Study.

The company has also ranked highest in India Sales Satisfaction Study.

The company's quality systems and practices have been rated as a "benchmark for the

automotive industry world-wide" by A V Belgium, global auditors for International

Organisation for Standardisation.

In keeping with its leadership position, Maruti supports safe drviIng and traffic

management through mass media messages and a state-of-the art drviIng training and

research institute that it manages for the Delhi Government.

The company's serVIce businesses including sale and purchase of pre owned cars

(TrueValue), lease and fleet management serVIce for corporates (N2N), Maruti

Insurance and Maruti Finance are now fully operational.. These initiatives, besides

34
proVIding total mobility solutions to customers in a convenient and transparent

manner, have helped improve economic VIability of The company's dealerships.

The company is listed on Bombay Stock Exchange and National Stock Exchange.

MUL is a Board-managed company. Currently the directors on the Board are:

 Mr Shinzo Nakanishi, Chairman

 Mr Jagdish Khattar, Managing Director

 Mr Hirofumi Nagao, Joint Managing Director

 Mr Shinichi Takeuchi, Joint Managing Director

 Mr Kinji Saito, Director (Marketing and Sales)

 Mr Osamu Suzuki, Director

 Mr R C Bhargava, Director

 Mr S V Bhave, Director

 Mr Kumar Mangalam Birla, Director

 Mr Amal Ganguli, Director

 Ms PallaVI Shroff, Director

 Mr ManVInder Singh Banga, Director

35
 OBJECTIVE OF THE COMPANY

Maruti’s marketing objective is to continually offer the customer new products

and serVIces that:

 Reduce the customer’s cost of ownership of their cars; and

 anticipate and address the customer’s needs and preferences in all

aspects and stages of car ownership, to proVIde what they refer to as the

“360 degree customer experience.”

They sell ten models with more than 50 variants in segments A, B, C, and utility

vehicle segment of the Indian passenger car market. Of these, they manufacture

nine models and import the Grand VItara as a completely built unit from Suzuki

in Japan. Their models and variants are designed to address the changing

demands of the market and are periodically upgraded in technology, styling and

features. To take advantage of the brand recognition associated with their

products, they retain the brand name of the product through various stages of

product upgrades over time. For example, the version of the Maruti 800 brand

currently sold in the market is a significantly upgraded version, in terms of

technology, design and styling, of the Maruti 800 launched in 1983.

36
 A Maruti 800

A OMNI

B Zen

B Wagon R

B Alto

C Esteem

C Baleno

C Versa

C SWIFT

Utility Vehicle GYPSY KING

Utility Vehicle GRAND VITARA

BALENO

37
WAGON R

38
 ESTEEM

MARUTI 800

39
NEW ALTO

OMNI

40
SWIFT

VERSA

41
ZEN

42
 CURRENT SALES OF AUTOMOBILES

Red Bull Maruti Suzuki Swift

Maruti Omni

India's Corps of Military Police personnel patrolling the Wagah border crossing

in thePunjab in a Maruti Gypsy .

43
Maruti Alto

Maruti Suzuki Swift

Maruti Suzuki Zen Estilo

44
Suzuki SX4

7th Generation Suzuki Alto is sold as Maruti Suzuki A-Star in India .

Maruti Suzuki Swift DZire

Suzuki Splash is sold as Maruti Suzuki Ritz in India.

1. 800 (Launched 1983)

2. Omni (Launched 1984)

3. Gypsy (launched 1985)

4. WagonR (Launched 1999)

45
5. Alto (Launched 2000)

6. Swift (Launched 2005)

7. Estilo (Launched 2007)

8. SX4 (Launched 2007)

9. Swift DZire (Launched 2008)

10. A-star (Launched 2008)

11. Ritz (Launched 2009)

12. Eeco (Launched 2010)

13. Alto K10 (Launched 2010)

14. Maruti Ertiga (Launched 2012), seven seater MPV R3 designed and

developed in India, will compete with Toyota Innova , Mahindra Xylo,

and Tata Sumo Grande. [41] In early 2012, Suzuki Ertiga will be exported

first to Indonesia in Completely Knock Down car.

15. Maruti XA Alpha based compact SUV to compete with the Ford EcoSport

& Renault Duster will be launched in the year 2014

16. Maruti Alto 800 (Launched 2012), Maruti Alto 800 is finally out with a

price tag of Rs.2.44 lakh (ex-showroom New Delhi). Maruti has rolled

out three standard variants-Alto 800 Base, Alto 800 LX and Alto 800 LXi

and three CNG variants -Alto 800 CNG Base,Alto 800 CNG LX and Alto

800 CNG LXi. ] The 0.8 litre of petrol engine is very fuel efficient and

pushes the car to produce high class mileage of 17 to 22 km per litre. The

45.7BHP of peak power produced by the engine is also successful on

road by delivering top-notch performance.

46
 Imported

Suzuki Grand Vitara

1. Grand Vitara (Launched 2007)

2. Kizashi (Launched 2011)

DISCONTINUED CAR MODELS

1. 1000 (1990–2000)

2. Zen (1993–2006)

3. Esteem (1994–2008)

4. Baleno (1999–2007)

5. Versa (2001–2010)

6. Grand Vitara XL7 (2003–2007 )

47
 MANUFACTURING FACILITIES

Maruti Suzuki has two manufacturing facilities in India.[45] Both manufacturing

facilities have a combined production capacity of 14,50,000 vehicles annually. During

a recent meeting of the Gujarat chief minister with Suzuki Motor Corp chairman &

CEO Osamu Suzuki,the Chairman had said that the work on car manufacturing plant

at Mandal near Ahmedabad would be started soon.

Gurgaon Manufacturing Facility

The Gurgaon Manufacturing Facility has three fully integrated manufacturing plants

and is spread over 300 acres (1.2 km2). All three plants have an installed capacity of

350,000 vehicles annually but productivity improvements have enabled it to

manufacture 900,000 vehicles annually. The Gurgaon facilities also manufacture

240,000 K-Series engines annually. The entire facility is equipped with more than 150

robots, out of which 71 have been developed in-house. The Gurgaon Facilities

manufactures the 800, Alto, WagonR, Estilo, Omni, Gypsy, Ertiga and Eeco.

Manesar Manufacturing Facility

The Manesar Manufacturing Plant was inaugurated in February 2007 and is spread

over 600 acres (2.4 km2). Initially it had a production capacity of 100,000 vehicles

annually but this was increased to 300,000 vehicles annually in October 2008. The

production capacity was further increased by 250,000 vehicles taking total production

capacity to 550,000 vehicles annually. The Manesar Plant produces the A-

star, Swift, Swift DZire, SX4 and Ritz.

Government Notice to Pay Rs 235 Crore for Manesar Plant Land allotment

48
On June 25, 2012, Haryana State Industries and Infrastructure Development

Corporation demanded Maruti Suzuki to pay an additional Rs 235 crore for enhanced

land acquisition for its Haryana plant expansion. The agency reminded Maruti that

failure to pay the amount would lead to further proceedings and vacating the enhanced

land acquisition.

SALES AND SERVICE NETWORK

As of 31 March 2011 Maruti Suzuki has 933 dealerships across 666 towns and cities

in all states and union territories of India. It has 2,946 service stations (inclusive of

dealer workshops and Maruti Authorised Service Stations) in 1,395 towns and cities

throughout India.It has 30 Express Service Stations on 30 National Highways across

1,314 cities in India.

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

managed on franchise basis, where Maruti Suzuki trains the local staff. Other

automobile companies have not been able to match this benchmark set by Maruti

Suzuki. The Express Service stations help many stranded vehicles on the highways by

sending across their repair man to the vehicle.

MARUTI INSURANCE

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

help of the National Insurance Company, Bajaj Allianz, New India Assurance and

Royal Sundaram. The service was set up the company with the inception of two

subsidiaries Maruti Insurance Distributors Services Pvt. Ltd and Maruti Insurance

Brokers Pvt. Limited

49
This service started as a benefit or value addition to customers and was able to ramp

up easily. By December 2005 they were able to sell more than two million insurance

policies since its inception.

MARUTI FINANCE

To promote its bottom line growth, Maruti Suzuki launched Maruti Finance in January

2002. Prior to the start of this service Maruti Suzuki had started two joint ventures

Citicorp Maruti and Maruti Countrywide with Citi Group and GE Countrywide

respectively to assist its client in securing loan. Maruti Suzuki tied up with ABN Amro

Bank, HDFC Bank, ICICI Limited, Kotak Mahindra, Standard Chartered Bank, and

Sundaram to start this venture including its strategic partners in car finance. Again the

company entered into a strategic partnership with SBI in March 2003 Since March

2003, Maruti has sold over 12,000 vehicles through SBI-Maruti Finance. SBI-Maruti

Finance is currently available in 166 cities across India.

"Maruti Finance marks the coming together of the biggest players in the car finance

business. They are the benchmarks in quality and efficiency. Combined with Maruti

volumes and networked dealerships, this will enable Maruti Finance to offer superior

service and competitive rates in the marketplace".

— Jagdish Khattar, Managing director of Maruti Udyog Limited in a press

conference announcing the launch of Maruti Finance on 7 January 2002

Citicorp Maruti Finance Limited is a joint venture between Citicorp Finance India and

Maruti Udyog Limited its primary business stated by the company is "hire-purchase

financing of Maruti Suzuki vehicles". Citi Finance India Limited is a wholly owned

subsidiary of Citibank Overseas Investment Corporation, Delaware, which in turn is a

50
100% wholly owned subsidiary of Citibank N.A. Citi Finance India Limited holds

74% of the stake and Maruti Suzuki holds the remaining 26%. GE Capital, HDFC and

Maruti Suzuki came together in 1995 to form Maruti Countrywide. Maruti claims that

its finance program offers most competitive interest rates to its customers, which are

lower by 0.25% to 0.5% from the market rates.

MARUTI TRUEVALUE

Main Article: Maruti True Value

Maruti True service offered by Maruti Suzuki to its customers. It is a market place for

used Maruti Suzuki Vehicles. One can buy, sell or exchange used Maruti Suzuki

vehicles with the help of this service in India. As of 31 March 2010 there are

341 Maruti True Value outlets]

N2N FLEET MANAGEMENT

N2N is the short form of End to End Fleet Management and provides lease and fleet

management solution to corporates. Clients who have signed up of this service

include Gas Authority of India Ltd, DuPont, Reckitt Benckiser, Sona

Steering, Doordarshan, Singer India, National Stock Exchange and Transworld. This

fleet management service include end-to-end solutions across the vehicle's life, which

includes Leasing, Maintenance, Convenience services and Remarketing.

51
 ACCESSORIES

Many of the auto component companies other than Maruti Suzuki started to offer

components and accessories that were compatible. This caused a serious threat and

loss of revenue to Maruti Suzuki. Maruti Suzuki started a new initiative under the

brand name Maruti Genuine Accessories to offer accessories like alloy wheels, body

cover, carpets, door visors, fog lamps, stereo systems, seat covers and other car care

products. These products are sold through dealer outlets and authorized service

stations throughout India.

MARUTI DRIVING SCHOOL

A Maruti Driving School in Indiranagar ,Bangalore

As part of its corporate social responsibility Maruti Suzuki launched the Maruti

Driving School in Delhi. Later the services were extended to other cities of India as

well. These schools are modelled on international standards, where learners go

through classroom and practical sessions. Many international practices like road

52
behaviour and attitudes are also taught in these schools. Before driving actual vehicles

participants are trained on simulators.

"We are very concerned about mounting deaths on Indian roads. These can be brought

down if government, industry and the voluntary sector work together in an integrated

manner. But we felt that Maruti should first do something in this regard and hence this

initiative of Maruti Driving Schools.

— Jagdish Khattar, at the launch ceremony of Maruti Driving School, Bangalore

ISSUES AND PROBLEMS

On 24 February 2010, Maruti Suzuki India announced recalling of 100,000 A-Star

hatchbacks to fix a fuel leakage problem. the company will replace the gaskets for all

100,000 A-Star cars.

EXPORTS

Maruti Exports Limited is the subsidiary of Maruti Suzuki with its major focus on

exports and it does not operate in the domestic Indian market. The first commercial

consignment of 480 cars were sent to Hungary. By sending a consignment of 571 cars

to the same country Maruti Suzuki crossed the benchmark of 300,000 cars. Since its

inception export was one of the aspects government was keen to encourage. Every

political party expected Maruti Suzuki to earn foreign currency. Angola, Benin,

Djibouti, Ethiopia, Europe, Kenya, Morocco, Nepal, Sri Lanka, Uganda, Chile,

Guatemala, Costa Rica and El Salvador are some of the markets served by Maruti

Exports.

53
AWARDS AND RECOGNITION

The Brand Trust Report published by Trust Research Advisory has ranked Maruti

Suzuki in the seventh position in 2011 and the sixth position in 2012 among the

brands researched in India.

Bluebytes News, a news research agency, rated Maruti Suzuki as India's Most Reputed

Car Company in their Reputation Benchmark Study conducted for the Auto (Cars)

Sector which launched in April 2012.

54
 RESEARCH METHODOLOGY

RESEARCH DESIGN

 Introduction

The two wheeler industry in India collectively produces 20 Lakh vehicles

a year. Some players have managed to cut through consumer resistance with

innovation, pricing and aggressive marketing. The competition level in the two

wheeler industry is very high now. Many brands are fighting in the market for

maximum share. They have to bring out a lot of differentiation among them. The

major duty of the marketer is to know the reasons for preferring particular motor

bike by the consumers.

 Review of Literature

The Customer Perception Report includes questions in four key areas,

Expectations, Purchase Decisions, Customer Service, and Future

Purchases. So the customer should be invited to participate in the survey.

Setting realistic expectations during the sales process is a vital

component of making happy customers. How a company sets and meets

product and service expectations plays a pivotal role in fashioning

customer opinions. How a company meets or exceeds expectations is

measured in three important areas: product/service, support, and price.

These three areas will be used to factor a score for the Expectations

category. The results of the three questions will be used to factor an

overall expectations perception score.

55
The Purchase Decision category gives us a better understanding of how the

customer perceives the purchase process. Two key areas for questions include an

open ended question on why they purchased and a ratings question on their

experience. The rating

Question data will be used for the analysis of Purchase Decision category. The

open ended responses from the “Why” questions will be used for product

strengths analysis. The results of the purchase experience question will be used

for the overall Purchase perception analysis. Customer service is one of the

most important differentiations a company can have. For this report, customers

will rate a company in three key areas: customer service, timeliness for problem

resolution, and expertise. These three areas will be used to factor a score for the

Customer Service category.

 Purpose of Literature Review

Literature review is one of the prime parts of every project. The very basic

purpose of the literature review is to gain insight on the theoretical

background of the research problem. It helps the researcher to gain strong

theoretical basis of the problem under study and also help to explore whether

any one has done research on the related issue. That’s why literature review

helps one to find out the path of problem solving. In this regards the very

basic purpose of the literature review in this dissertation is same as

mentioned

56
Methodology

The research will be done through survey method. The collection of data

will be done through questionnaire, interview and related websites

The sample size taken for this research is 100 customers those who

having HERO motor bikes.

The area of this survey consist of Lucknow city

The collection of data will be done with the help of a structured

questionnaire. The designing of questionnaire needs precision and classification

of the subject, so that the respondents can easily understand the question and

can answer it sincerely and correctly.

 Sources of Data

 Primary data:-

Primary data consists of original information for the specific purpose at

hand. It is first hand information for the direct users of respondents. The tools

used to collect the data may vary and can be collected through various methods

like questionnaire, personal interview

 Secondary data:-

Secondary data is the data which is already been collected and assembled. This

data is available with the companies or firms and it can be collected from newspapers,

periodicals, magazines, websites etc.

57
  Sample Design

The sample size taken for this research is 100 customers having HEROmotorbikes.

 Sampling Technique

Convenient Sampling technique is used for this project.

 Data Collection Tool

Questionnaires as the primary form of collecting data.

 Statistical techniques

1. Bar Diagrams

2. Pie-Chart

 Statistical tools

1. Statistical software like Microsoft Excel

 Limitations of the study:-

1. In this study it is not possible to collect the opinion of all the

customers owing to personal constraints. So the assumptions are

drawn on the basis of the information given by the respondents.

2. The study needs to be completed within a specified time of one month

and in certain restricted areas. So the findings cannot be generalized

for the company as a whole.

3. This study covers only a limited HERO sector. So this study will not

be applicable for those areas.

58
 FINDINGS OF THE STUDY

PRICES OF MARUTI PRODUCTS

Car market leader Maruti Udyog Limited has announced a marginal increase in price

of certain models. The increase, which comes into effect from today, varies from 0.17

percent to 1.47 percent.

The price increase is due to rise in input costs and freight costs, which increased

following the rise in oil prices. In this phase, the company has decided to pass on

only a part of the increase in costs to the customers. There is no change in the

prices of Swift, Zen, Baleno (Vxi) and WagonR (Petrol).

Ex-Showroom Prices in Delhi (in Rs)

Change

Model New Old Increase %

M800 Std 191646 191146 500 0.26%

M800 Std Ac 213062 212562 500 0.24%

Alto Std 231585 231085 500 0.22%

Alto Lx 265262 264762 500 0.19%

Alto Lxi 283878 283378 500 0.18%

Omni Cargo LPG 194725 192725 2000 1.04%

Omni Cargo 213706 213206 500 0.23%

Omni (Eight Seater) 221268 220768 500 0.23%

Omni LPG 230388 227388 3000 1.32%

59
Esteem Lx 445968 444968 1000 0.22%

Esteem Lxi 476223 475223 1000 0.21%

Esteem Vxi 511520 510520 1000 0.20%

Baleno Lxi 576173 575173 1000 0.17%

Versa Dx 433575 432575 1000 0.23%

Versa Dx2 471779 470779 1000 0.21%

Versa Std 360182 359182 1000 0.28%

WagonR Lx LPG 345106 340106 5000 1.47%

WagonR Lxi LPG 373160 368160 5000 1.36%

ORGANISATION STRUCTURE AT MUL

60
Maruti Udyog ltd. Has a flat organisation structure with a maximum of three levels.

Head officeMD

MFG FIN OTHER

DIRECTOR N CONTROLLER GM DGMS AGMS

GM/ DGMS DGMS AGMS MGRS/AMS

MGRS/AMS MGRS/AM SR GM/EX

ENGINEERS(EX) SR. EX./EX TRAINEES

J.E. (TRAINEES)

61
THE PRODUCTION PROCESS AT MARUTI

STEEL COILS

BLANKING

PRESSING

WELDING

PAINTING

FROM FROM
ASSEMBLY VENDOR
VENDOR
S S

VEHICLE FROM
INSPECTION VENDOR
S

TEST RUN

SUPPLY &
DISPATCH

62
 INTERNATIONAL BUSINESS

In August, 2003 Maruti crossed a milestone of exporting 300,000 vehicles since its

first export in 1986. Europe is the largest destination of Maruti’s exports and

coincidentally after the first commercial shipment of 480 units to Hungary in 1987,

the 300,00 mark was crossed by the shipment of 571 units to the same country. The

top ten destinations of the cumulative exports have been Netherlands, Italy, Germany,

Chile, U.K., Hungary, Nepal, Greece, France and Poland in that order.

The Alto, which meets the Euro-3 norms, has been very popular in Europe where a

landmark 200,000 vehicle were exported till March 2003. Even in the highly

developed and competitive markets of Netherlands, UK, Germany, France and Italy

Maruti vehicles have made a mark. Though the main market for the Maruti vehicles is

Europe, where it is selling over 70% of its exported quantity, it is exporting in over 70

countries.

Maruti has entered some unconventional markets like Angola, Benin, Djibouti,

Ethiopia, Morocco, Uganda, Chile, Costa Rica and El Salvador. The Middle-East

region has also opened up and is showing good potential for growth. Some markets in

this region where Maruti is, are Saudi Arabia, Kuwait, Bahrain, Qatar and UAE.

The markets outside of Europe that have large quantities, in the current year, are Algeria,

Saudi Arabia, Srilanka and Bangladesh. Maruti exported more than 51,000 vehicles in 2003-

04 which was 59% higher than last year. In the financial year 2003-04 Maruti exports

contributed to more than 10% of total Maruti sales.

63
64
MARUTI ALL INDIA SALES – 3 YR TREND

Segment 2003-04 Growth 2004-05 Growt 2005-06 Growth

h
A1 (Mini - Hatchback) 167,561 17% 116,262 -31% 89,223 -23%
A2 (Compact - Hatchback) 176,132 47% 271,280 54% 335,136 24%
A3 (Mid Size) 14,173 28% 29,637 109% 31,939 8%
A4/A5/A6 NA NA NA NA NA NA

(Exec./Prem./Luxury)
C (Van Type) 59,526 15% 65,019 9% 66,366 2%
Passenger Cars - MUL 417,392 28% 482,198 16% 522,664 8%
Passenger Cars - Total Industry 758,123 26% 885,029 17% 948,669 7%
MUV (Utility Vehicles) 3,555 12% 5,204 46% 4,374 -16%
Passenger Vehicles - MUL 420,947 28% 487,402 16% 527,038 8%
Passenger Vehicles - Total 901,150 24% 1,050,246 17% 1,129,31 8%

Industry 6

65
MARKET SHARE

2005-06 Market Share-Segment A2

TATA
20%

MARUTI HYUNDAI
59% 21%

2005-06 Market Share-Segment A3

HYUNDAI TATA
16% 20%
MARUTI
17%
FORD
14%
OTHERS GM
7% HONDA
6%
20%

2005-06 Market Share-Passenger Cars

TATA FORD
HONDA
HYUNDAI 16% 3%
4% GM
17%
1%

TOYOTA
1%

OTHERS
MARUTI 3%
55%

66
 COMPETITION MODELS

Maruti Competition
SEGMENT
A1 (Mini - M800

Hatchback)
A2 (Compact - Zen, WagonR, Hyundai - Santro & Getz; Tata - Indica &

Hatchback) Alto, Swift Palio; GM - Corsa Sail

A3 (Mid Size) Esteem, Baleno Hyundai - Accent; Tata - Indigo & Petra;

Honda - City; GM - Corsa, Optra, &

Aveo; Ford - Ikon, Fusion, & Fiesta

A4/A5/A6 Hyundai - Elantra & Sonata; Honda -

(Exec./Prem./Luxury) Accord; GM - Vectra; Ford - Mondeo;

Skoda - OctaVIa & Superb; Toyota -

Corolla & Camry; Daimler Chrysler -

C,E, & S Class;

C (Van Type) Omni, Versa
MUV (Utility Gypsy, Grand Mitsubishi - Pajero; Hyundai - Terracan

Vehicles) VItara & Tucson; Ford - Endeavor; Toyota -

Prado & Innova; Nissan - X Trail; Honda

- CRV; GM - Forrester & Tavera; Tata -

Sumo & Safari; Mahindra - Jeeps,

Scorpio, & Bolero

67
 COMPETITIVE STRENGTHS

MUL believes that they are well positioned to maintain and enhance their leadership

position in the small car segment in India, while continuing to offer products in most

segments of the Indian market, on account of their competitive strengths, which

include the following:

Expertise in small car technology: As a subsidiary of Suzuki, they have access

to globally respected technology in the small car segment. They have the

advantage of Suzuki’s expertise in all aspects of small car technology and

design, with respect to their products, their manufacturing processes and

business practices, the development of their supply chain and the training of

their personnel.

Extensive product portfolio: Their diverse product range includes cars in

segments A, B and C, and utility vehicles. They manufactured five out of the ten

models that were sold in the combined A and B segments in India in fiscal 2002.

They are the only manufacturer of cars in segment A (priced below Rs.300,000)

where they have two models, the Maruti 800 and the Omni. The Maruti 800 has

been the largest selling car in India for several years, and continued to have the

highest sales volumes of any model, with a market share of 25.3%. The Omni, a

versatile vehicle that can seat more passengers than the Maruti 800 or be used as

an ambulance or cargo vehicle, had a market share of 10.5% in fiscal 2002.

They are also the only manufacturer to sell three distinct models, the Zen, the

Alto and the Wagon R, in segment B (priced between Rs.300,000 and

Rs.500,000). They believe that theirdominance in segment A and extensive

68
product range in segment B enables us to offer the customer a wider choice in

the small car segment than any of their competitors. In addition, the absence of

other manufacturers in segments A gives their dealers greater flexibility in

promoting models in segment B.

Quality products: In November 2001, they were one of the first automobile

manufacturers in the world to receive the ISO 9001:2000 certification. They

began to export products in 1988, primarily in order to benchmark our products

against international quality standards. They have exported products to

approximately 70 countries, including countries in Western Europe. Their

products for export are manufactured using the same assembly line as our

products for the domestic market.

Extensive sales and serVIce network: They believe that they have the largest

network of dealers and serVIce centers amongst car manufacturers in India. As

of March 31, 2003, we had 178 authorized dealers with 243 sales outlets in 161

cities. They estimate their car parc to be in excess of 3.5 million vehicles. To

serVIce this car parc, at March 31, 2003, they had 342 dealer workshops and

1,545 Maruti Authorized SerVIce Stations, or MASSs, which covered 898 cities

in India backed by Express SerVIce Centers on 30 highways across the country.

In addition to the distribution of their cars, their dealership network is a critical

resource in our efforts to proVIde customers with a “one-stop shop” for

automobiles and automobile related products and serVIces such as automobile

finance, automobile insurance, Maruti-certified pre-owned cars available for

purchase, and leasing and fleet management, in order to promote customer

loyalty.

69
Brand strength: They have been present in the Indian market for almost twenty

years and have built their brand on the basis of the values of trust and reliability.

Most of their principal competitors have been present in the Indian passenger

car market for a significantly shorter period. Certain manufacturers have ceased

to manufacture certain products shortly after introducing them, or have left the

market altogether. In contrast, they continue to support the maintenance of their

products. This has contributed to the strength of their brand. In 2000, 2001 and

2002, J. D. Power Asia Pacific, Inc. ranked us No. 1 in the India Customer

Satisfaction Index, which assesses customer satisfaction with product quality

and dealer serVIce. They believe that this was the first time that a volume leader

in the automobile industry anywhere in the world was ranked first on the JD

Power Customer Satisfaction Index. NFO Automotives 2002 Total Customer

Satisfaction Survey ranked Maruti products as No. 1 in the “Economy”,

“Premium Compact” and “Entry Midsize” segments respectively, for 2002.

Integrated manufacturing facility: Their manufacturing facility comprises

three integrated plants with flexible assembly lines located at Gurgaon in the

northern state of Haryana. Their facility has advanced engineering capability

and each plant is upgraded on an ongoing basis to improve productviIty and

quality. As a result, their first plant set up in fiscal 1984 is technologically at par

with their newer plants and is also used in the production of their new models.

They believe that they are one of the most efficient among the vehicle

manufacturing facilities of Suzuki’s subsidiaries outside Japan in terms of

productviIty measured as the ratio of number of vehicles produced to number of

employees. They have an installed capacity of 350,000 vehicles per year, which

70
is the highest among passenger car manufacturers in India and among the

passenger car manufacturing facilities of Suzuki’s subsidiaries outside Japan.

They have consistently produced in excess of their installed capacity in the five

fiscal years ended March 31, 002.

They believe that they would be able to expand their production to 500,000 cars

per year with minimal additional capital expenditure. This would enable them to

benefit from significant economies of scale.

Strong vendor base and higher rates of localization: They work closely with

their vendor base for the supply of raw materials, components and spare parts of

their products. In order to improve quality and generate economies of scale,

they have reduced the number of their vendors of components in India from 370

as of March 31, 2000 to 299 as of March 31, 2003, and intend to continue to

reduce the number of our vendors. 113 of their vendors at March 31, 2003 were

in technical collaboration with foreign entities. As of the same date, we had

strategic equity interests through joint venture agreements in 13 of their

vendors, who together supply a substantial portion of their purchases of

components. A number of their vendors are their dedicated suppliers in that they

account for a majority of their turnover. Vendors located within a radius of 100

kilometers from their facility supply the majority of their components. The

production systems of their vendors are generally aligned to their need for a

reliable and timely supply of components that meet their quality requirements.

This has enabled them to increase the proportion of locally sourced, lower cost

components in their models, a concept they refer to as localisation. They have

been able, in collaboration with their vendors, to increase the rate at which they

71
are able to localise production of their new models over time. This has helped

them reduce the cost of their components.

Skilled labour and experienced management: Thei highly skilled labour force

has become increasingly productive in terms of vehicles produced per employee

and receives training on an ongoing basis, including training by Suzuki. As of

March 31, 2003, 1,900 of their employees had been trained at Suzuki’s facilities

in Japan. They have been present in the Indian passenger car market for a

significantly longer period than most of their principal competitors. As a result,

they have been able to build a highly experienced management team that is

familiar with conditions in the Indian passenger car market. For instance, their

managing director has almost ten years of experience with them, and most of the

heads of their dviIsions have more than 15 years of experience with them.

Capital resources: They have cash and bank balances and current investments

amounting to Rs.9,992 million. As of the same date, they had relatively low

levels of outstanding indebtedness, in the amount of Rs.4,555 million. As a

result, they have relatively low interest expense and flexibility to raise funds, if

necessary, for their working capital and capital expenditure in the future.

72
 BUSINESS STRATEGY

They intend to continue to focus on the small car segment, while offering

products in most segments of the Indian passenger car market. They aim to

achieve their principal objectives by pursuing the following business strategies:

Maintain and enhance their product range: They intend to utilize Suzuki’s

expertise in small car technology to produce new variants of their existing

models and to upgrade their products with contemporary technology and

features.

Increase reach and penetration: They plan to continue to utilize their

extensive sales and serVIce network to increase the reach, in terms of

geographical spread, and penetration, in terms of sales volumes, of their

products across India.

Increased availability of automobile finance: They continue to seek

opportunities to expand the size of the Indian passenger car market, especially

in the small car segment, through facilitating easy availability of automobile

finance. To that end, they have recently entered into an agreement with the State

Bank of India.

Secure repeat purchases by offering a “360 degree customer experience ”:

On the basis of their belief that securing repeat purchases from an existing

customer requires less expenditure than acquiring a new customer, they aim to

proVIde customers with a “one-stop shop” for automobiles and automobile-

related products and serVIces.

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Continue to benchmark their manufacturing capabilities: They plan to

continue to benchmark our manufacturing capabilities with the most efficient

car manufacturing facilities of Suzuki and its subsidiaries.

Continue to reduce costs to offer more competitive products:

Cost competitiveness has been, and continues to be, central to their strategy as

the leading manufacturer in the small car segment to expand the size of the

market by offering competitively priced, high quality products. The components

of this strategy are:

 Higher levels of localization

 Vendor participation in cost reduction

 Cost reduction on warranties

 Reduction in initial investment cost

 Reduction in number of vehicle platforms

 Achieve further cost reduction through higher productviIty

Lower cost of ownership:

Through their business strategies, they seek to reduce the consumer’s cost of

ownership of their cars, which comprises the cost of purchase, the cost of fuel

and maintenance, including spare parts and repairs, during the life of the

vehicle, insurance, and resale value.

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 SALES NETWORK

Dealers: They offer their products to the customer through a network of 178

authorized dealers with 243 sales outlets across 161 cities. They believe that this

is the largest network of dealers amongst car manufacturers in India. Their

dealers employed more than 3,500 sales executives. They are linked to their

sales network through their secure extranet-based information network. The

sales of their spares, accessories and automobile-related serVIces such as

insurance and finance serve as additional sources of revenue for our dealers.

They believe that the availability of these related products and serVIces at sales

outlets also helps to attract customers to the outlets and promotes sales of their

cars.

Agreements with dealers: They generally appoint a limited number of dealers

for a certain geographical territory. Their dealers proVIde serVIces to customers

such as pre-delivery inspection of vehicles, sales of cars, after sales serVIce,

supply of spare parts and other serVIces that promote sales of cars within the

territory for which they are appointed. They have the right to sell their products

and serVIces through other dealers or intermediaries in any territory, whether or

not one of their dealers is already established in that territory. Their dealers are

required to maintain their outlets in accordance with their specifications and

employ well-trained sales staff.

Their agreements with their dealers usually have terms of five years. These

agreements are generally renewable for successive terms of three years, by

75
mutual agreement. The agreements typically permit termination by either the

dealer or them with six months’ prior notice.

Enhancing dealer performance: Their central office in Delhi, their regional

offices and their area offices monitor and assist their dealer network. They have

nine regional offices, five area offices and 187 sales and marketing personnel.

They follow the performance of their dealers and frequently suggest

improvements. In order to assist their dealers in enhancing their performance

and capabilities, they have introduced a concept of “Balanced Scorecard”. Using

this tool, they seek to measure the performance of a dealership in several areas

of operations, including sales, serVIce, spares and accessories, financial

management and management systems. They reward dealers who perform well

on the “Balanced Scorecard” with a cash payment at the end of the fiscal year.

They believe that the “Balanced Scorecard” serves as an effective incentive for

dealers to enhance their performance.

Dealer training: They have established standard operating procedures,

showroom ambience and serVIce quality standards for dealerships. They

proVIde periodic training through their training centres located at their

manufacturing facility and at Chennai, Kolkata, Guwahati and Pune. They have

trained more than 2,600 and 3,400 dealer sales personnel. Their subsidiary, True

Value Solutions Ltd., proVIdes value-added serVIces, such as manpower

recruitment and training, to their dealers.

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 AFTER-SALES SERVICE

Network

As on date there are 342 Maruti dealer workshops and 1,545 Maruti Authorised

SerVIce Stations, or MASSs, covering 898 cities in India. In addition, 24-hour

mobile serVIce is offered in 38 cities under the brand “Maruti On-road

SerVIce”. They intend to extend this serVIce to an additional 25 cities over the

next three years. As a benchmark for dealers with respect to serVIce quality and

infrastructure facilities, they have launched serVIce stations under the brand

“Maruti SerVIce Masters, or MSMs, in three locations in India. They have

serVIce stations on 30 highways in India under the brand “Express SerVIce

Stations”.

To promote sales of their spare parts and the availability of high quality, reliable

spare parts for their products, they sell spares under the brand name “Maruti

Genuine Parts”, or MGP. These are distributed through their dealer network and

through authorised sellers of their spare parts, to whom they refer as stockists.

Many of their MASSs are at remote locations where they do not have dealers. In

order to increase the penetration, in terms of sales volumes, of their products in

these remote areas, they are exploring opportunities to integrate some of the

MASSs into the sales process in order to increase sales of their cars and related

products and serVIces such as spares and accessories, insurance and financing.

Genuine Accessories

They have also entered the business of marketing car accessories under the

brand name “Maruti Genuine Accessories”, or MGA, through their dealership

77
network. They seek to proVIde customers with the opportunity to customize

their vehicles with accessories such as music systems, security systems, car-care

products and utility products.

Warranty and Extended Warranty Program

They offer a two-year warranty on all their vehicles at the time of sale. Their

dealers are required to address any claim made by a customer, in accordance

with practices and procedures prescribed by them, under the proVIsions of the

warranty in force at that time. The dealers subsequently claim the warranty cost

from them. They analyse warranty claims from dealers and either claim the cost

from vendors, in the case of defective components, or bear the cost ourselves, in

the case of manufacturing defects.

They offer an extended paid-warranty program marketed under the brand,

“Forever Yours” for the third and fourth year after purchase. They have entered

into arrangements with insurance companies to cover the costs of warranties

offered under this program. The extended warranty program is intended to

maintain the dealer’s contact with the customer and increase the revenue

generated from sale of spares, accessories and automobile-related serVIces. An

effort is made during the period of the extended warranty to encourage the

customer to exchange his existing Maruti car for a new Maruti car, or upgrade to

a new Maruti car.

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 NEW BUSINESS INITIATIVES

As the largest manufacturer and leader in the small car segment, they continually seek

new ways to utilize their vast car parc, range of products and extensive sales and

serVIce network to expand the size of the passenger car market in India. They have

recently launched new initiatives to develop the market for automobile insurance,

automobile finance, leasing and fleet management, and pre-owned cars. They aim to

proVIde customers with a “one-stop shop” for automobiles and automobile-related

products and serVIces, and build on their wide customer base and extensive sales and

serVIce network to make available to their customers a wide range of Maruti-branded

serVIces at different stages of ownership, which they refer to as the “360 degree

customer experience”.

Atithi Devo Bhava: One-stop shop

Inspired by the spirit of India. Atithi Devo Bhava, in Sanskirit, means “a guest is like

God”. It captures the Indian tradition of honouring guests. It's also the inspiration for

the welcome you’ll receive at a Maruti Suzuki dealership, and the caring relationship

they share with those who drive their cars. At Maruti Suzuki, you will find all your car

related needs met under one roof. Whether it is easy finance, insurance, fleet

management. serVIces, exchange Maruti Suzuki is set to proVIde a single window

solution for all your car related needs.

That's why they have Maruti True Value, the best place to buy and sell reliable

used cars. Maruti Finance an agglomeration of the biggest finance companies in

India brought together by Maruti Suzuki to ensure that the dream car is within

everyone's reach. Similarly, Maruti Insurance brings together some of the

79
biggest names in the car insurance industry to proVIde insurance solutions to

every type of car consumer. Then, finally, there is N2N, which offers fleet

related solutions.

THE PLAYERS IN THE INDIAN AUTOMOBILE INDUSTRY

Hyundai Motor India Ltd

Hyundai Motor India Limited (HMIL) is a wholly owned subsidiary of Hyundai

Motor Company, South Korea and is the second largest and the fastest growing car

manufacturer in India. HMIL presently markets 31 variants of passenger cars in six

segments. The Santro in the B segment, Getz in the B+ segment, the Accent in the C

segment, the Elantra in the D segment, the Sonata Embera in the E segment and the

Tucson and Terracan in the SUV segment.

The company recorded combined sales of 252,851 during calendar year 2005 with a

growth of 17.26% over year 2004. HMIL is India's fastest growing car company

haVIng rolled-out over 970,000 cars in just over 80 months since its inception and is

the largest exporter of passenger cars with exports of over Rs. 1,800 crores. HMIL has

recorded a growth of 27.2% in exports over the year 2004.

HMIL’s fully integrated state-of-the-art manufacturing plant near Chennai boasts some

of the most advanced production, quality and testing capabilities in the country. In

continuation of its investment in proVIding the Indian customer global technology,

HMIL has announced plans for its second plant, which will produce 300,000 units per

annum, raising HMIL’s total production capacity to 600,000 per annum by 2007. The

plant will be built on a 2.1 million square meter site adjacent to the existing facility

80
.HMIL is investing to expand capacity in line with its positioning as HMC’s global

export hub for compact cars. Apart from expansion of production capacity, HMIL

plans to expand its dealer network, which will be increased from 157 to 200 this year.

And with the company’s greater focus on the quality of its after-sales serVIce, HMIL’s

serVIce network will be expanded to over 1,000 in 2006.

The year 2005 has been a significant year for Hyundai Motor India. It achieved a

significant milestone by rolling out the fastest “200,000th” export car. HMIL exports

to around 60 countries globally and recently made a foray into the highly competitive

UK market by exporting its first shipment of 820 cars.

Propelled by the strong performance in year 2005, Hyundai Motor India is on the

threshold of yet another grand milestone of rolling out its ‘One millionth’ car which is

expected soon.

Tata Motors

Tata Motors is one of the largest companies in the Tata Group with a total

income of US$ 2.35 billion. More than 3 million Tata vehicles ply on Indian

roads making Tata a dominant force in the Indian automobile industry.

Tata Motors is India's only fully integrated automobile manufacturer with a

portfolio that covers trucks, buses, utility vehicles and passenger cars. It would

be no exaggeration to say that Tata Motors proVIdes the wheels for India's

growth.

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Tata Motors has the unique distinction of gviIng India its first and only indigenously

built passenger car - The Tata Indica and the premium feature sedan - The Tata Indigo.

The Indica, launched in 1998, reached the 2,50,000 sales mark within 52 months of

launch.

Tata Motors owes its leading position in the Indian automobile industry to its strong

focus on indigenisation. This focus has driven the Company to set up world-class

manufacturing units with state-of-the-art technology. Every stage of product

evolution-design, development, manufacturing, assembly and quality control, is

carried out meticulously. Their manufacturing plants are situated at Jamshedpur in the

East, Pune in the West and Lucknow in the North.

Ford India Limited

The Ford Motor Company has a rich legacy of translating better motoring ideas to the

roads. It has manufactured notable brands such as the Ford, Lincoln, Mercury and the

Jaguar. It is among the top five industrial corporations in the world and is available in

more than 200 countries around the world.

Ford has entered the Indian market through a tie - up with Mahindra Motors to

manufacture the Ford Escort. A project that has been set up with a investment of

Rs.1700 crore. Ford India Limited is a subsidiary of Ford Motor Company, currently

Ford has a 78% stake, which is going up to 92% soon. The Maraimalai Nagar Plant of

Ford India Limited, located roughly 45k.m.from Chennai, proVIdes employment to

over 20000 people.The plant has the capacity to manufacture 1,00,000 vehicles per

annum, equipped with state-of-the-art vehicle manufacturing technology from Ford.

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Presently offering seven different models, Ford India Limited (FIL) is catching up fast

with the Indian consumer. This is secured through a quality check program based on

the principles of NOVA - C (New Overall Vehicle Audit - Customer) wherein daily

random checks are conducted from a customer's point of VIew. To be doubly sure,

routine calls are made to dealerships to check the quality of cars delivered to them.

At Mahindra's dealerships are present trained professionals who proVIde the

best levels of serVIce in India. Its intensive manpower training, advanced

serVIce equipment and dedicated consumer satisfaction are the are its plus

points which is being followed by the entire industry.

Acknowledgement has come in the form of the J D power 1997 India Initial Quality

and Customer Satisfaction Awards. These internationally acclaimed and recognized

awards voted the Ford Escort as the Best Quality car and the Mahindra Ford and its

dealerships were rated the highest in Customer Satisfaction. This is an honour as it its

only the second time in automotive history that the same brand/manufacturer has

received both the awards in the same year.

General Motors India

General Motors India, incorporated in 1994 as a 50-50 joint venture company with the

C.K. Birla Group of Companies, became a fully owned subsidiary of GM in 1999

when GMOC bought the remaining shares. The company was restructured in 1999

and was converted from a Public Limited company to a Private Limited company. GM

APH LLC currently holds 86 percent of voting shares, and Holden (Australia) holds

83
14 percent. The SPO business was integrated with the main business in the same

company in 2000.

In India, GM strengthened its presence with new product launches Chevrolet Optra in

2003 and Chevrolet Tavera (Multi Utility Vehicle) in 2004. Similarly in 2004, GM

India is expected to register a growth of 90% over 2003. With sales volume going up,

the market share of GM India has gone to nearly 2%. The sales volume in 2003 was

15,155 units while 2004 figure is expected to be around 27,000 units. In 2004, the

company sold a total of 26,166 cars as against 15,155 cars in 2003 registering a

growth of 73% while overall passenger car growth during the year was only around

23-24%. These included 9191 Chevy Optras in Entry 'D' Luxury sedan segment, 8369

Opel Corsas and 8417 units of the new generation premium multi-utility vehicle

(MUV) Chevrolet Tavera.

The existing GM India plant was originally built by Hindustan Motors. In 1994, GM

India entered into a 50% Joint Venture partnership with Hindustan Motors and

modernized the 45,000-square-meter plant near Halol, 45 kilometers northwest of

Vadodara, in the western state of Gujarat. In February, 1999, GM bought the holdings

of Hindutan Motors and GM India became a 100% subsidiary of General Motors

Corporation of USA. The plant produces the Opel Corsa, Corsa Sail, Chevrolet Optra,

and Chevrolet Tavera. The Chevrolet Forester and Opel Vectra are sold as CBUs

(Completely Built in Units) and as imported from Japan and Germany respectively.

Toyota Motor Corporation is the third largest automaker in the world. They have

34 dealers in India and in Delhi they have 2 dealers, first one is ‘South Delhi

Toyota’ and second one is in Moti Nagar in which I have VIsited during my

84
survey. Dealer in Moti Nagar which is “Galaxy Toyota” have predetermined

mission that-Customer comes first and everything they do is to meet their

customer needs, basically they work for creating a lifetime customer.

They work by dviIding their work like in one showroom they have separate

teams for every product like relating to Corolla it comprises of 7 or 8 executives

who handle all the work weather it is of sale or any enquiry or telemarketing

call that team must have some specific target to achieve. They reach to the

customers either by distributing Leaflets, Brochures to the customers. They

collect customer database from Directory (Yellow Pages) or through customer

references even they solve customers query online and give information through

e-mails. Recently they organized one drawing competition between the kids of

their existing customers just to interact with the customer and build loyalty of

their company products. They judge their customer satisfaction by analyzing

that repeat buyers are more or not & moreover they have customer feedback

form in which they can analyze customers background and can forecast

customer future demands. They target only high profile customers.

They build customer loyalty by gviIng happy calls to the customer after sale of

every 1,3,7 month. They proVIde Periodic maintenance schedule, which will

ensure that vehicle, is kept in best able-bodied at all times. The maintenance

schedule may include periodic inspection, adjustment and lubrication that will

keep vehicle in the safest and most efficient condition, they proVIde one

booklet in which they give simple and useful tips for maintenance of the car.

They offer good schemes like proVIding free Test Drive worth Rs 250 petrol at

85
the time of sale of any car. They do road shows to attract customers. To promote

their product they organize exchange mela, events, various cash discounts like

currently they are running one discount scheme on purchase of any of their car

(Innova, Toyota) they are gviIng free accessories worth Rs15000. They proVIde

4 free serVIces after sale and with full clean diesel.

All employees of Galaxy Toyota shall consider how they should act and how

they might change their ways to benefit the company. They launch one “Co

Branded Credit Card” to proVIde additional benefits and serVIces to the Toyota

customers. This Credit Card will give Toyota customers a better payment

flexibility and convenience, like Customer gets free serVIce voucher with the

card, Special InVIte to co-sponsored events, Personal accident insurance

coverage: Up to 20 lakhs etc. They have one Guest Book in which they store

valuable comments of customers, which they think are very important for them,

which will help them to improve their serVIce.

HONDA

Honda is one of the leading manufacturers of automobiles and power products and the

largest manufacture of motorcycles in the world. They have 20 dealers in 42 different

cities around India. In New Delhi they have 6 dealers, I have VIsited one of them,

which is in Najafgarh Road.

They do surveys to know customers need. They target either existing or their

perspective customers by gviIng advertisement in the newspaper or through there

satisfied customers which give references. They don’t believe on targeting

86
competitor’s customers because by not doing so they have such a brand reputation

with good quality products, only through this they are able to make good sales.

They display their models in 8th Auto Expo, which held in New Delhi. They are

now focusing on their new model ‘CviIc’. Honda's CviIc perhaps drew the

maximum attention. The reason is simple: CviIc is a new car from the house of

Honda. During my survey I get to know that Honda City Model is the second

largest selling car in the ‘C’ segment. They have a good superiority with

superior brand name in the country.

They prefer to have mode of communication with the customer through mail,

telephone and sometimes by letter. Customers who don’t have time even to see

the model or to call the dealer to make inquiries about their reservation they

desire to solve their query online itself.

To judge customer satisfaction they some times inVIte their customers to have a get

together, to have interaction with customer in a minute to know that are they satisfied

with their serVIces and what they are expecting from them in the near future. They

make maximum of their sales from the fresh customers rather than their repeat

purchasers. To increase their sales they try to extort surreptitious information from the

customers and on their end they aim to ensure that the product quality and product

quantity should be available in required quantity in their dealership.

They have Feedback form in which they take feedback of the customer as well as their

salesperson because through this they are able to get the information of both the

customer & their salesperson that are they gviIng the full information to the customer.

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This Dealership even proVIde technical skills and techniques to their employees that

how to deal with the customer thoughtfully every after 6 months.

EED FOR CRM IN AUTOMOBILE INDUSTRY

The global automotive industry exhibits most of the characteristics of mature

industries and closely follows their business cycles. While vehicle industry sales have

been strong for the past several years, they have started to slow recently due to the

current global economic slowdown. Deteriorating economic conditions result in a

drop in consumer confidence, which quickly impacts automotive sales due to their

big-ticket status and the relative low cost of extending the life of an existing vehicle

through maintenance and repair.

The advent of the Internet as a research tool (75 to 80 percent of auto consumers

research using the Internet) has shifted power to consumers, further increasing

pressure on prices. At the same time, government regulation and consumer demands

for sophisticated features have increased development, production, and marketing

costs. Regional economic fluctuations favor consolidation among car companies,

suppliers, and retailers -resulting in fewer, larger companies that have more complete

product lines targeted at existing and new markets. Consolidation has heightened

competition in all vehicle segments. Low-cost manufacturers are expanding beyond

their home markets with entry level vehicles, traditional passenger car manufacturers

are expanding into the light truck markets, and luxury manufacturers are moVIng

down market with passenger cars and SUVs. As a result of these product and market

extensions, consumers find it difficult to exhibit brand loyalty because vehicles have

unclear brand identities, similar features, and comparable prices. In addition, an

88
overpopulation of dealers has resulted in local and regional competition among same

make dealers. This further reduces margins and damages the brand images the car

companies spend large amounts of money to build.

Relations between the car companies and their suppliers traditionally have been

difficult. In response to competitive pressure, suppliers have been forced by the car

companies to proVIde higher-quality components at constantly lower costs. The

resulting decrease in margins and the reduction in volume due to slowing sales have

increased the pressure to consolidate and forced some suppliers to the brink of

bankruptcy. Dealers too have a long history of adversarial relationships with the car

companies. Independent entrepreneurs who VIew some of the car companies with

skepticism or serious mistrust, dealers believe that many manufacturer-sponsored

customer satisfaction programs are actually designed to force smaller dealers out of

business or to gain control of customer relationships that the retailers believe they

"own."

These difficult relationships have prevented car companies and dealers from

maximizing the lifetime value of their combined customers. There are few incentives

or efficient methods for dealers and car companies to share critical data, resulting in

ineffective management of product, serVIce, and household information. In addition,

consumers receive conflicting marketing communications from the two groups, which

results in reduced brand value.

89
KEY INDUSTRY PAIN POINTS

 Decreasing sales and market share - The long-term battle for market

share continues to intensify. In the mature automotive industry, where

business cycles drive sales fluctuations, market share is critical to

surVIval. Consumers are less brand-loyal than in the past, and every

market segment has an increasing number of vehicle choices. To increase

sales and gain ground in the market share battle, companies must improve

their ability both to acquire first-time customers and to develop customer

loyalty to their current brands. To achieve these related objectives,

companies must set an aggressive goal -deliver the best customer

experience in the automotive industry.

 Difficult dealer relationships and a lack of dealer collaboration - As

the consumer 's primary touch point ,the dealer network is a critical

component of customer-facing operations. Therefore, the integration of

the dealer network is absolutely essential to improVIng the quality of the

customer experience. Only with an infrastructure that enables the

effective flow of information to and from dealers can companies create a

complete VIew of their customers. Car companies must take the initiative

in understanding the customer 's perspective throughout the buying cycle.

 Lack of multichannel capabilities - With the advent of the Internet as a

research tool, the majority of customers are accessing the automotive

enterprises through several different channels. Many times, the switch

90
 between channels happens very rapidly as a prospect or customer can

VIew a Web site, make a phone inquiry, and VIsit a retail store within

days or even hours of an initial contact. To improve customer satisfaction

and secure customer lifetime value, companies must be able to capture

these multiple interactions, proVIde seamless management between

channels, and leverage shared customer information to create rewarding

experiences and to develop and execute highly targeted marketing

campaigns.

 Inefficient demand chain planning and high associated IT cost - Cost

reduction is an ongoing competitive requirement. Just as supply chain

management must be supported by a sophisticated information

infrastructure, effective demand chain management also requires the right

supporting infrastructure, enabling car companies to fully leverage each

customer relationship through exceptional customer serVIce, efficient

lead generation and management, and effective promotions and

campaigns. In addition, global automotive enterprises operate a wide

variety of IT systems in their various business units and functional

groups. Rationalizing these systems offers significant cost saVIngs.

 Lack of effective information sharing - Car companies must integrate

global operations in order to achieve the benefits of consolidation -cost

reduction, effective communication, and true integration of core

competencies. In addition, internal alignment between business units and

functional groups is required to create a unified VIew of consumers,

products, and serVIces. Currently, each business unit, functional group,

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 and brand operates through independent systems, programs, and touch

points. As a result, there is limited synergy across the ecosystem, leading

to significant inefficiencies, lack of coordination, and most important, an

inability to maximize "share of wallet "from every customer through

well-targeted marketing and cross-selling. Synergy between traditionally

independent business units such as captive finance companies and

between functional groups such as sales, serVIce, and marketing is more

critical now than ever before. Only by sharing customer information can

customer lifetime value be maximized among different groups.

 Complex data governance requirements - Global automotive

enterprises have large, complex information technology ecosystems.

While customer information must be shared within this ecosystem in

order to fully maximize global operations, it must also be protected.

Proper management of customer information requires a sophisticated

capability to manage a variety of access rules and to accommodate legal

restrictions that can change very quickly. The trust required for successful

collaboration between groups in the automotive enterprise must be built

by demonstrating that customer information can be shared while

obserVIng these complex requirements.

 Difficulty managing employee relationships - In today 's fast-paced

business enVIronment, automotive companies need to ensure that their

most valuable asset -their employees -have immediate access to the

critical information, serVIces, and applications required to be productive.

Organizations must enable employees to make better decisions, work

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 collaboratively, enhance customer relationships, and maximize productive

time. Global automotive enterprises must be able to enact and enforce

consistent policies across business units, instill a common corporate

culture across a geographically dispersed and diverse workforce, equip

employees with effective search tools to access corporate knowledge

bases, and proVIde employees with the training necessary to serVIce

customers in a volatile and demanding market.

Target Marketing Procedure Of Various Companies

TARGET SEGMENT

To reach to rural and lower middle class consumers. They begin with small

concentrated markets appealing to local culture and aspirations of the

targeted area

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 STRATEGY

THEIR STRATEGY IS TO CAPTURE THE RURAL MARKET BY

EMPLOYING WOMEN WHO BELONG TO THEIR LOCAL

COMMUNITY THROUGH WHICH THEIR PRODUCT CAN REACH TO

LOCAL CONSUMERS. THEIR STRATEGY IS TO PROVIDE WORK

FOR WOMEN TO CREATE AWARENESS AMONG CONFINED

CONSUMERS

Process

They started with Project Shakti in which their basic aim is to educate a rural person about

their products through women who belongs to their own local community and who can

communicate well in their language with them. In this way many educated women get work

in rural sector and on the other hand HLL Corporate Social Responsibility (CSR) also

increases towards society by introducing educative programs for the benefit of the rural

sector

Mode of Communication

They reach to customers by gviIng advertisements in the T.V. or through radio,

through wall painting, or through promotional actviIties like weakly haats, mela or

local bazaars and most importantly, their policies were flexible and they could adapt

to fast changing marketing situations.

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Through Internet, E-mail usage, communication media like telephone and mail facility

this mode of communication is possible to a great extent. ITC’s extensive India-wide

distribution network enables its greeting cards reach over 12,000 multi brand outlets

in over 700 cities across the country. In the last three years, 10,000 greeting card

designs have reached these outlets with the help of ITC's web-enabled e-commerce

model –Communication Model ITC markets

Opportunity

These days’ consumers are looking for convenience and instant gratification.

Communication media like the telephone and e-mail facilitate communication

to a great extent. But many greeting card sites are moVIng from a 'free' to a

'pay' mode. This could be an emerging revenue earning opportunity for content

proVIders.

Threats

'Expressions' which is a competitor of ITC in this segment is currently the second

biggest greeting card brand in India with a market share of 20 per cent. ITC has a five

per cent share in the stationery market. The greeting card market in India is estimated

to be around Rs. 250 crore in terms of yearly consumer spent. The unorganized sector

in the greeting card market will be close to 40 per cent. The organized sector,

controlling 60 per cent of the market, is dviIded between ITC, Archie’s and Hallmark.

While Archie’s has licensing agreements with international greetings brands

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 CONCLUSION

The price of a car is just one-third of what it cost you over its lifetime. Running and

maintaining it make up the other two-thirds. Take into account resale value and its real

cost becomes clear. Maruti Suzuki stands for value as much as it stands for

performance. In spite of rising input costs, we try our best to keep prices down. Their

running costs and resale values are unbeatable too. Nothing matches the delight their

cars deliver. In the JD Power CSI study 2005, 85% of Maruti Suzuki owners stated

that they would definitely recommend the car they drive to someone else. Infact, you

don’t buy a Maruti Suzuki. You invest in it.

After the rash of new cars launches the past two years, the relative lull in the auto

industry is showing up in the customer satisfaction indices. According to the 2005

four-wheeler Total Customer Satisfaction (TCS) study conducted by the specialist

dviIsion of TNS Automotive, the automobile ownership experience or customer

ownership experience has declined in all areas compared to 2004. The study is one of

the largest syndicated automotive studies in India, representing the responses of more

than 7,000 new car buyers. The comprehensive study covers over 50 models with

customer evaluations taken in the key areas of sales satisfaction, product quality,

vehicle performance and design, after-sales serVIce, brand image, and cost-of-

ownership. The TCS index score proVIdes a measure of satisfaction and loyalty a

given model enjoys with its customers. According to TNS Automotive, the decline is

predominantly for older, small and entry mid-size car models. The ageing of these

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models seems to be posing a stiffer challenge for manufacturers to sustain past

performance levels at a time when customer expectations are rising sharply.

The study reveals a significant increase in the importance of sales satisfaction, product

quality (both performance and design) and brand image since 2003, indicating rising

customer expectations over the years. This year's study shows the Maruti Suzuki

Swift and the Toyota Innova as the winners, with the two vehicles achieVIng segment-

best ratings by performing well in areas of greater relevance, particularly product and

brand image. Sales satisfaction is weak in both these models, largely because of the

longer waiting time for new deliveries.

TNS Automotive's TCS Study has, since its inception in 2002, surveyed over 25,000

car buyers and hasbuilt a sizeable sample base. Some of the key findings, indicators

and inferences from the 2005 study are:

Progressive reduction in car ownership cycle-time from an average of 61 months in

2002 to 53 months in 2005: This shortened cycle-time is bringing these owners for

repeat purchases sooner and will, therefore, further fuel the growth of the four-wheeler

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market. This trend is already VIsible in the growing additional/replacement purchases.

Growth in additional (multi-car households) and replacement purchases up from 51

per cent in 2002 to 65 per cent in 2005: This will impact the volume growth in higher-

end segments as the current car owners show upward mobility.

Increasing budget for future purchases: Future intenders with a budget of Rs 6 lakh

plus have increased from 44 per cent in 2002 to 58 per cent in 2005. While first-time

buyers are declining as a composition of total volumes, the figure in absolute terms is

high, fuelled by the up-gradation by two-wheeler owners The study also throws up

the question as to whether it is also possible that the first-time car buyer who is

generally a two-wheeler owner, is getting more fuel efficiency conscious and tending

towards postponing the car purchase decision due to the high cost of fuel. Of course a

shift in composition is also to be expected with the upper premium compact and mid-

size segments projected to grow at a much faster rate than rest of the industry. The

TCS study was conducted from August through October across 21 cities. Small

sample models have not been featured in the charts. These include the Fiat Petra

Diesel, Ford Fusion, Ford Mondeo, Hyundai Terracan, Maruti Esteem Diesel, Maruti

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Suzuki Grand VItara, Maruti Zen Diesel, and Opel Corsa Sail. TNS has a global

network spanning 70 countries and is listed on the London Stock Exchange.

Maruti Udyog Ltd is one of India 's leading automobile manufacturers and the

market leader in the car segment, both in terms of volume of vehicles sold and

revenue.

Good Technology

Uniform Pricing

Good Strength

More Coverage Area

Frequent /Regular Product Launch

Market Leader (with 47% share)

Oriented Driven Company

More Product Offering

Healthy Annual Report

Brand Image

Maximum Dealership as compared to other brands

Good Sale SerVIce

Spare parts are cheap as compared to any other brand

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Cheap & reliable quality

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AREAS FOR IMPROVEMENT / RECOMMENDATION

Facade/Quality of Dealership should be improve

Uniform of Sales Executives

Proper VIsiting cards should be available to the executives

Mostly dealers don’t have their specific website

All Japanese 5’s concept (Seiro, Sieton, Sciso, Seioetse, Shitsuke)

should be put into practice at Dealership

Maruti should regard as generous discount offers during Festival

Season like Navratra, Dusshera, and Diwali to gear-up their sales

Maruti should advertise in Sports because sports are increasingly

cutting into the share of mass entertainment channels

Maruti can start Money Bond Scheme instead of gviIng Cash Discount

with more value. Customers eligible for an income bond, encashable after

a 15year period.

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 LIMITATIONS OF THE STUDY

Since the road to improvement is never ending, so this study also suffers from

certain limitations. Some of them are as follows:

 Because of illiteracy, it was a time consuming method in which continuous

guidance was required.

 Questionnaire method involves some uncertainty of response. Co-operation

on the part of informants, in some cases, was difficult to presume.

 It is possible that the information supplied by the informants may be

incorrect. So, the study may lack accuracy.

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 BIBLOGRAPHY

Reference Books, Journals, Newspaper, Web Sites, Reports, etc are to be listed, out

here

Books

Kotler Philips, Marketing Management Analysis, Planning Implementation & Control

Edition 1998. Prentice hall of India Ltd. New Delhi

Magazines Jourals & Newapaper

Name of the articles, Business Today: 15-22May 2000

Name of the articles, The times of India . Mumbai: 21st May 2000

http://www.marutisuzuki.com/

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

http://www.zigwheels.com/newcars/Maruti-Suzuki

http://articles.economictimes.indiatimes.com/2012-07-02/news/32508687_1_diesel-

engine-diesel-cars-800cc

http://www.carwale.com/research/marutisuzuki-cars/?ltsrc=3n229&gclid=CIO21-

P25rMCFVF96wodjF8ADg

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