Maruti Auto Expo’08

Introduction
Maruti Suzuki India ltd.
 Maruti is India's largest passenger car company, which account for over 50 per cent
of the domestic car market.

Maruti have a sales network of 562 outlets in 372 towns and cities, and provide
maintenance support to customers at 2538 workshops in over 1200 towns and cities (as
on December 31,2007).

The company boasts about its products, which offer unsurpassed fuel efficiency, low
maintenance costs and easy availability of genuine parts.

 MUL extended its product range to include vans, multi-utility vehicles (MUVs) and mid-
sized cars.
 Suzuki saw its Indian sales rise 21 per cent to 653,000 cars
 Of the $3.5 billion Suzuki plans to spend on its expansion in India
MUL’s Competitive Advantage
 Size
 Low Initial investment
 Unique concessions from the government
 Indigenous sourcing of components
 Fully depreciated plants
 High labour productivity
Maruti Suzuki ranks highest in customer satisfaction with
authorized dealership service
Maruti models
Comparing Maruti 800 and Tata Nano
Maruti Suzuki India Limited has showcased three
concept cars at the Auto Expo 2008

• Concept A-Star,
• Concept Splash and
• Concept Kizashi
 Concept A-Star

 It is a concept car because it is for

the first time that Suzuki has
premiered a concept in India.
 It is the first Japanese-Indian
concept vehicle.
 Segment: A (currently Alto is the
market leader in this segment.
 Expected price: A-star is expected
to be priced around the 3-4 lakh
range($7500)
 Competitors: Chevrolet Spark and
the Hyundai i10.
 Segmentation,Targeting and Positioning

Segmentation
DEMOGRAPHIC:
A) Age- 20-34
B) Gender- Male, Female
C) Family size- 3-4 , 4+
D) Income - RS 20000-30000, 30000-50000, 50000 and above.
E) Occupation- Professionals, Officials, Supervisors, Home makers, Youngsters.
PSYCHOGRAPHIC
A) Social class: Middle class, working class, upper lowers.
B) Lifestyle: Strivers, Achievers
C) Personality: Gregarious, Ambitious, Compulsive
BEHAVIORAL:

A) Benefits: Quality. Service, Economy, Speed

B) Readiness stage: Interested, Intending to buy

 Cont……...
TARGET MARKET:
 Expected price: A-star is expected to be priced around the 3-4lakh range
 It will target the small car segment A segment where ALTO is the market leader.
 It will mainly focus on the middle and workers class people.
 It will satisfy both the needs of European and Indian customers.

POSITIOINING:
 The A-Star would be launched in other international markets gradually.
 The A-Star is an environmentally oriented concept and would be produced with a very
efficient 1-litre petrol engine, which would have great mileage and low emissions.


The A-Star might just be the new Alto in India.
 Porter’s Five Force Model
Potential entrants
 Will impart a spectacular growth to the entire industry by actually widening and deepening it.
 It is doubtful if the current growth rate of over 50 per cent would have been possible but for the
entry of these players.

 New entrants into this segment could be Honda with its sub-compact Jazz, or Honda Life as it is
called in other markets

 Ford India with either the Fusion or the Fiesta

Rivalry amongst the existing firms

 And from a second-hand car to cars like the Maruti Zen, Hyundai Santro, Daewoo Matiz or the Tata
Indica.

 Throw in a few more lakhs and you can bite into the wider small segment populated by the Hyundai
Santro, Maruti Zen, Maruti WagonR, Tata Indica, and Fiat Palio.

 The deluxe version of the Zen, the fully-loaded Santro and the Matiz form another segment along
with the Fiat Uno.
 Cont…….
Substitutes
 Maruti swift sedan, Maruti splash, Tata 1 lakh car a small family car actually a substitute for a
Maruti A-star.

 The Indica and the Santro due to its high presence in the market can be substitute for A-star

 Due to lower price consumer can shift to motorbikes and scooters launched by TVS, Bajaj and
Yamaha.

Bargaining power of suppliers

 The cars of Maruti are differentiated to such an extent that it is difficult for buyers to switch over to
other products.

 As Maruti is dominant player in the market holding 50% share in the industry, it is highly attractive
to buyers.

 Branding- The brand Maruti is strong due to its role of quality and services
 Switching Costs- It’s easy for suppliers to locate new customers.
 Cont…….
Bargaining power of buyers

• Usually customers appreciate and look for various features in a car. Often there is a loyal
set of customers. Cars enhance social status and there may be a strong association of
price with quality and status.
 Switching costs- It’s easy for buyers to locate new suppliers
 Large number of options available
 Well informed customers
 Availability of finance schemes
 Concept Splash

 Segment: B (Next generation Wagon R)

 Expected price: Rs 4.5-5.5 lacs
 Theme: ‘Family’
 The name Splash signifies its desire to
create a new sensation.
 Splash combines the sportiness of
Suzuki's successful model Swift with
the technologies and immense know-
how
 Suzuki unveiled its’ splash’ MPV
(Multi Purpose Vehicle) in the
Frankfurt Motor Show.
 Segmentation, Targeting and Positioning

SEGMENTATION
DEMOGRAPHIC:

 A) Age- 20-40

 B) Gender- Male, Female

 C) Family size- 4-5 , 5
 D) Income - RS 25000-35000, 35000-50000, 50000 and above.
 E) Occupation- Professionals, Officials, Managers, Sales, Youngsters.
PSYCHOGRAPHIC:
 A) Social class: Middle class, Upper middle class
 B) Lifestyle: Achievers, survivors
 C) Personality: Gregarious, Ambitious
BEHAVIORAL:
 A) Benefits: Quality. Service, Economy, Speed

 B) Readiness stage: Interested, Intending to buy

 Cont…….
TARGET MARKET:
 It will target the B-segment
 The theme of the splash is basically focusing on FAMILY
 It signifies its desires to create a new sensation. Its vivid sound creates a sense of
freshness and youthfulness.
 It will likely appeal to those with small families and low budget.

POSITIONING:
 The Japanese major chose the name Splash for the car to “signify its desire to create a
new sensation.
 Maruti Suzuki's Splash is orientated strongly towards the European design style. Splash
will be marketed for its such high seating position, good visibility and spacious interiors.
 Suzuki's Splash will offer comfortable space for five occupants due to clever packaging
 Porter’s Five Force Model
POTENTIAL ENTRANTS:
 It is doubtful if the current growth rate of over 50 per cent would have been possible but for the
entry of these players.

 CHEVROLET AVIO (AVEO-5) – mp3 enabled audio system, carbon fiber trim, solid fuel economic
ratings.

 TOYOTA’S youth oriented spin off: SCION XD- subcompact interior, fuel economy 30mpg,
transportation costing <$16000.

 VOLKS WAGEN: POLO-diesel push, sharper price $16990, face lift.

RIVALRY AMONG EXISITING FIRMS:

 And from a second-hand car to cars like the Maruti800, Maruti zen, Hyundai santro, Maruti esteem,
Maruri alto etc..

 TATA’S low cost car will create a new segment as no cars available in 1lakhs-2lakhs segment.

 HYUNDAI latest small car-pressure on pricing.

 SATURN AURA XB-bidding for mid-size segment.
 Cont…..
BARGAINING POWER OF SUPPLIERS:
 The cars of Maruti are differentiated to such an extent that it is difficult for buyers to switch over to
other products.

 As Maruti is dominant player in the market holding 50% share in the industry, it is highly attractive
to buyers.
 Branding- The brand Maruti is strong due to its role of quality and services
 Switching Costs- It’s easy for suppliers to locate new customers.
SUBSTITUTES:
 Maruti SWIFT SEDAN, Maruti A-STAR, TATA 1 lakh car a small family car actually a substitute
for a Maruti SPLASH..

 Maruti WAGON-R, CHEVROLET AVEO, HYUNDAI i10.

 PEOPLE can switch over to new bikes launched by Yamaha-R1, BAJAJ, TVS.

 PEOLE can go for Diesel or Cng cars due to high prices of petrol and fuel efficiency eg. SWIFT
SEDAN
 Cont……….

BARGAINING POWERS OF BUYERS:

 SWITCHING COST- buyers looking for new suppliers.
 Consumer going for second hand car market.
 Availability of :
a) Finance scheme
b) Registration insurance
 Different substitutes available.
 Concept Kizashi

 Competitor: Honda’s civic

 Segment : D
 Theme: “Status”.
 With Concept Kizashi, Suzuki
Motor Corporation has
announced its entry into the D-
segment.
 Segmentation, Targeting and Positioning

SEGMENTATION

DEMOGRAPHIC:
A) Age- 20-34

B) Gender- Male, Female

C) Family size- 3-4 , 4+

D) Income - RS 50000-75000, 75000-100000, 100000-125000, 125000-150000 and over.
E) Occupation- Professionals, officials, Youngsters.
PSYCHOGRAPHIC:
A) Social class: Upper middle class, High class
B) Lifestyle: Achievers
C) Personality: Gregarious, Ambitious
BEHAVIORAL:

A) Benefits: Quality. Service, Economy, Speed

B) Readiness stage: Interested, Intending to buy

 Cont…….
TARGET MARKET:
 KIZASHI revealed in Frankfurt represents the beginning of the 3rd phase of world strategy.
 It is into a Luxury car segment. It will mainly target the high class people with its sporty looks and
comfort,
 Its main objective will focus on status.
 It will target an un-compromised combination of affordability and emotional appeal
POSITIONING:
 The sportiness that Suzuki wants to deliver in the D-segment will perhaps be most directly expressed
by the car's dynamics.

 The design of the new car should have two themes: grace and dynamism.

 Kizashi represents Suzuki's passion for challenges (this is a major aspect of Suzuki's corporate
culture), its future direction, and the competitive strengths that are unique to Suzuki.
 Porter’s Five Force Model
POTENTIAL ENTRANTS:
 BMW-1-series

 Octavia Skoda
 Skoda Fabia- engines offered in 4 trims levels- active, classic, ambiente and elegance.
 Audi
 Honda Accord-LX – 16inch alloy wheel, 166-hp, 2.4-4lt cylinder engine.
 Chevrolet Captiva- sporty design, luxury features, seating, ride control.
SUBSTITUTES:
 HONDA CIVIC
 TOYATA COROLLA
 HYUNDAI SONATA
 SKODA AUTO- OCTAVIA
 VOLKSWAGEN JETTA
 Cont…….
Rivalry Amongst the existing players
• The growth of the car industry is on a high pace, companies are coming up with new models every
six months.

• Rivalry tends to intensify as the number of competitors increases and as they become more
equal in size and capacity.
• Rivalry is more volatile and unpredictable the more diverse the competitors are in terms of their
strategies, personalities, corporate priorities, resources, and countries of origin.

Bargaining power of suppliers

 The cars of Maruti are differentiated to such an extent that it is difficult for buyers to switch over to
other products.

 As Maruti is dominant player in the market holding 50% share in the industry, it is highly attractive
to buyers.

 Branding- The brand Maruti is strong due to its role of quality and services
 Cont…….
Bargaining power of buyers

• Usually customers appreciate and look for various features in a car. Often there is a loyal
set of customers. Cars enhance social status and there may be a strong association of
price with quality and status.
 Switching costs- It’s easy for buyers to locate new suppliers
 Large number of options available
 Well informed customers
 Availability of finance schemes
Promotional Tools By Maruti In Auto Expo’08

• HUGE BANNERS AND POSTERS

• ALLOWING PUBLIC TO TAKE FEEL
• FREE INSURANCE FOR ON THE SPOT
BOOKING
• ATTRACTION THROUGH MODELS
• BROCHERS,PAMPHLETS AND CONTESTS
Which stall did you like the most?

30
25 12
20 14
15
28
10
7
5
0 4
Maruti Honda Others
- 19% of the people liked Maruti.

- 22% of the people liked Tata.

- 43% of the people liked Honda.

- 10% of the people liked Hyundai.

- 6% of the people liked others.

WHAT DID YOU LIKE THE MOST ABOUT MARUTI?

PERFROMANC
E
RELIABILITY
PRICE

LOOKS

25% OF THE PEOPLE ARE SATISFIED WITH THE PERFORMANCE

-27% OF THE PEOPLE ARE SATISFIED WITH ITS RELIABILITY
-30% OF THE PEOPLE ARE SATISFIED WITH THE PRICE
-18% OF THE PEOPLE ARE SATISFIED WITH ITS LOOKS
DID YOU LIKE THE PROMOTIONAL
STRATEGY OF MARUTI?

YE
S
NO

- 57% OF THE PEOPLE SAID YES

- 43% OF THE PEOPLE DID NOT LIKE IT
WHICH OF THE THREE MODELS DID
YOU LIKE THE MOST?
30

20

10

0
A STAR SPLASH KAIZASHI

- 27% OF THE PEOPLE LIKED A STAR CONCEPT

- 38% OF THE PEOPLE LIKED SPLASH
- 35% OF THE PEOPLE LIKED KAIZASHI
DO YOU MARUTI 800 WILL BE PREFERABLE
AFTER THE LAUNCH OF TATA NANO?

YE
S
NO

 51%OF THE PEOPLE WERE SATISFIED

 -49% OF THE PEOPLE WERE UNSATISFIED
DO YOU THINK THAT MARUTI WILL FACE
COMPATITION FROM OTHER NEW CARS?

YE
S
NO

 78% OF THE PEOPLE AGREE

- 22% OF THE PEOPLE DISAGREE
DO YOU THINK THAT THE FEATURES OF MARUTI HAS
IMPROVED IN ITS NEW CARS?

YE
S
NO

 -80% OF THE PEOPLE AGREED

 -20% OF THE PEOPLE DISAGREED
 Conclusion
 It can be concluded from the project that Maruti is a brand, which
consumers prefer to buy, due to its fuel efficiency and cost
effectiveness.
 Due to the launch of Maruti’s 3 concept cars that is A-star, Splash and
Kizashi customers are willing to purchase and experiment these new
cars with its improved features.
 Maruti will face stiff competition from others new cars launched in the
market
 Maruti’s 3 new cars will be successful in the coming market and will
be most preferred by the customers.
Thank You