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Block –I Summer 2010 Submitted To – Mrs Jyotsna Mukherjee Submitted By – Naveen Chandani & Ridhima Bhanot 17th July’2010 Advertising & Sales Promotion Of Maruti

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Page 1: Maruti Final2

Submitted To –

Mrs Jyotsna Mukherjee

Submitted By –

Naveen Chandani

& Ridhima Bhanot

17th July’2010

Block –ISummer 2010

Advertising & Sales Promotion Of Maruti

Page 2: Maruti Final2

Table Of Content

Executive Summery.....................................................................................................................................3

Integrated Marketing Tools Used By MARUTI-............................................................................................4

Advertising Agency......................................................................................................................................5

CONSUMERS................................................................................................................................................6

Source..........................................................................................................................................................7

Message......................................................................................................................................................7

Channel.......................................................................................................................................................7

Advertising Objectives-................................................................................................................................8

Advertising Budget-.....................................................................................................................................8

CREATIVITY..................................................................................................................................................9

Media Strategy-.........................................................................................................................................10

SOCIAL AND ETHICAL ISSUES.....................................................................................................................11

CONCLUSION & ANALYSIS.........................................................................................................................12

Page 3: Maruti Final2

Executive Summary

The Automobile market has become competitive and the consumer purchasing patterns

are highly volatile and hence effective consumer promotions have a much greater significance

in marketer’s media planning. In order to tackle the tough competition from its competitors

most of the brands need to formulate effective promotions and there by in current scenario

companies working with expert advertising agency for there brand promotions is a must

Moreover there is a constant need of enhancing the advertising campaign through out,

it should create interest in the minds of consumer so that every time they look for any car to

buy, they look for our brand.

Automobile industry has gone a long way in formulating and implementing the

promotional strategies. Promotion strategies formulated by Lintas Media Group have been

diversified to produce good results. All the promotion type advertising, sales promotion,

personal selling, online marketing, Public Relations and direct marketing are being used

effectively to increase the sales as well as market share. Sales promotion is the area where

most of the automobile companies are giving more importance because of its contribution

towards the total sales. Effective and attractive promotional schemes are to be formulated for

successful promotion of brand and thereby conveying the company’s vision & mission.

With the increasing importance of web media and news channels, print media is finding

itself at a bit lower position however it doesn’t mean that it has lost its importance but still

people are taking more interest in web media as it is now easily accessible and available at

quite lower price than print media. But still it has to go a long way to outcast print media as

print media has itself got a lot of importance.

Although Maruti is doing well in terms of advertising but every where there is a

possibility that its brand is backed by strong commitments like widest network of service

stations, Power K series engines.

Page 4: Maruti Final2

Introduction

A Brief about Maruti –

• Maruti Udyog - a joint-venture between Suzuki of Japan (26% stake) and the Indian government in 1981

• 10 basic models and more than 50 variants

• 3 out of top five selling car model in India are Maruti Product (M 800, Zen, Alto)

• Annual production capacity 5, 00,000 with 47.30% market share.

SWOT Analysis of Maruti –

STRENGTHS WEAKNESSEstablished distribution and after-sales networks Lack of experience with foreign marketUnderstanding of the Indian Market and liaison with govt. Inexperience with foreign workforceAbility to design products with differentiation features Heavy Import tariffsBrand Image & Experience & Know- how in technology

OPPURTUNITIES THREATSIncreased purchasing power of Indian middleclass category Emerging CompetitionGovernment Subsidies & Tax Benefits Increasing cost of inputsForeign Collaboration Rapid change in customer preference

Page 5: Maruti Final2

Integrated Marketing Tools Used By MARUTI

Page 6: Maruti Final2

Advertising Agency

Advertisements- Through TV Commercials, Newspapers & Radio for conveying message & vision of company

TV Comercials- To convey that MARUTI has the largest & strong service network.

Newspaper- For MARUTI's special offers like cash discounts, free insurance, extra serive and even sometimes for special events like rally race. The advertisements are sometimes national as well as local

Radio- For special offers like cash discounts, free insurance which is seasonal

Direct Selling- Maruti do not approach customers directly, As the demand is so high that company just look out for its after sales services & send emails only to those who are already subscribed as their customers.

Interactive / Internet Marketing- By providing profiles on different sites -Linkedin link- http://www.linkedin.com/companies/maruti-udyog-limitedFacebook - http://www.facebook.com/home.php?#!/pages/Maruti-Suzuki/112771768739928?ref=tsOrkut- http://www.orkut.co.in/Main#Community?cmm=428413 ( With 5978 members)

Sales Promotions- Discount CouponsContests- Rally RaceDemonstrations- In big melas the demonstrations of their new launch cars, Test DrivesDisplays - Hordings & Banners on roads and fairsIncentives- Sales incentives for its employeesBuilding brand awareness and encouraging repeat buying as offering exchange offers under TRUE maruti venture where customers have option to sell their old car and buy new one.

Publicity/Public Relations- Arranging Rally race like Himalayn Rally Race and sponcering award shows like IIFA, Filmfair and sponcering IPL Matches too.

Personal Selling- Maruti is doing personal selling for its insurance venture with National Insurance Co Ltd, which is callled as "MARUTI NATIONAL"

This service is introduced to offer complete package for their customers and hence building a better brand image among its customers to provide a complete package offer as maruti provide better depriciation rate and now thereby poeple trust maruti brand so much that they say if its maruti it has to be good

Page 7: Maruti Final2

Agency Name- Lintas Media Group

Website- http://www.lintasmedia.in

Offices –

Some of its major clients-

Services by the Agency -

Page 8: Maruti Final2

Lintas Media Group offer wide range of services and they are:

Scheduling the advertisement timings Giving percentage of advertisement to particular channels Setting the target budget for their clients Maintaining companies public relations strategy Building Brand image among target customers Growing brand awareness of company in market Internet brand promotions as well

CONSUMERS

The consumer behaviour becomes a “mystery”: segments and diverse expectations make forecasts almost impossible.

Legislation, global changes, technology trends and uncertainty on the customer side redefine automotive landscape

Emerging marketing buyers generate ultra-low cost (ULCC’s) segment Senior citizens play increasingly important role in mature markets “My Generation” ask for more tailored products even at higher price. New Mobility Concepts – non buyers, instead car sharing and new rental formats.

As a fresh approach, Maruti has its own campaign running for delighting customers: Engineering 2020 and the attributes are – Styling & Design, Technology - OEM Strategy, Our offering, and facing the key challenges.

Page 9: Maruti Final2

SOURCE

Most of the messages for Maruti are delivered by the man himself Mr Amal Ganguli (Director). There are very few celebrities who actually indulge in endorsement for Maruti, as they believe in actual customer experience and count upon their service.

Mr Shinzo Nakanishi, Managing Director and CEO, Maruti Suzuki delivers speech at occasions such as new years and silver jubilee projecting different brands of the company.

Actor R. Madhavan has also been appointed as the brand face for its popular hatchback Wagon R. Madhavan was considered a right fit after analysing his future ventures/projects and the brand objectives of the product.

MESSAGE

Maruti Suzuki adopts regional approach to transfer their message. They focus more on regional communication strategy by having local language dialogues to reach out to the masses. This is the strategy to make the brand more relatable to its current and prospective users.

Some of the quotes showing Maruti’s messages are –

Usually campaigns focus on offerings, but we now had to talk about the experience. The car in this context is not just about transporting people from place A to B. It had to stress an emotional connect. And it's this emotional connect that is totally unique to Maruti."

- Mayank Pareek, Executive Officer (Marketing and Sales), Maruti Suzuki India Limited, in June 2008.

"After investing Rs 90 billion in manufacturing facilities, we are now looking to invest in marketing infrastructure and brand-building initiatives. These will enhance customer experience with Maruti Suzuki."

- Shinzo Nakanishi, MD and CEO, Maruti Suzuki India Limited, in April 2008.

CHANNEL

Maruti launched several television commercials (TVC) for its promotion and carried on several ad campaigns. The ad campaigns including the TV commercial were developed by Capital Advertising and also included print ads, outdoor campaigns, and internet ads. Therefore the channel of communication mainly adopted by Maruti is through both personal and non-personal channels.

Page 10: Maruti Final2

ADVERTISING OBJECTIVES

Advertising campaigns included TVCs, print and radio ads, outdoor promotions, point of sale and mobile promotions. The company also organized different promotional events to attract prospective consumers. Maruti also offered special schemes for specific professional and income groups.

Maruti's advertising strategy focused both on promoting its cars and on building up its corporate image. Maruti's campaigns emphasized different aspects of its cars, including fuel efficiency, space, looks, etc. It also advertised its widespread network and services. The ad campaign for the 'K' series engine was the first time that Maruti was advertising specifically a technological innovation that it had pioneered.

This change in advertising strategy was probably because the company had decided to put the new 'K' series engines into all its existing and new products. To begin with, Maruti had the 'K' series engine only in its two new cars, A-Star and Ritz, and it had also announced that it would incorporate the new engine in Zen Estilo and Wagon R.

Advertising Budget-

Spends Pattern Value in CRTotal Media Spend 2009-10 190TV Spend 2009-10 86News Spend 2009-10 13.78Hindi News Spend 2009-10 9.45Aaj Tak Spend 2009-10 5.75

TVTN Spend History -

Year Budget2008-09 3.5 Cr2009-10 5.74 Cr

Page 11: Maruti Final2

CREATIVITY

The creative process of Maruti Suzuki includes the various strategies adopted by the company as in the PRICING Strategy –

Caters to all segments and has a product offering at all price points. Their pricing strategy is to provide an option to every customer looking for up gradation

in his car.

Creating different REVENUE STREAMS –

Maruti Finance Maruti Insurance Maruti Driving Schools

CORPORATE STRATEGIES –

Maintaining Status quo due to limited environmental opportunities for gaining competitive advantage.

Few employees will have opportunities for advancement. Critical that management identify key employees and develop specific HR retention

strategies to keep them

REPOSITIONING of products –

Whenever Maruti’s brand grew old or its sales started dipping , it made the following efforts in the same field :

Omni – interiors & exteriors Versa – slashed prices by decreasing engine power Esteem – new look to boost sales Baleno – price slash from 1999 (7.2lacs) to 2003 (5.46) Wagon R – modifications in engine and sporty look Zen – modified for times and special additions Maruti 800 – Introduced modified accessories

DIFFERENTIATION –

Page 12: Maruti Final2

In order to demand a premier price from consumers – by attempting to distinguish organizational products or services from other competitors.

Organizational offers employees incentives and compensation for creativity. HR Strategy focuses on external hiring of unique individuals, and on retaining creative

employees.

SELECTIVE TARGET APPROACH –

Promotion for urban people through mall, auto mall buying, clubs, megadealers Promotion for rural people through car fair easy finance scheme for “Panchayati”

MEDIA STRATEGY

Dates & Action

End of Apr-May-June End of September End of December End of MarchApril - Innovations for WagonR Blue Eyed campaing launch.May- Present Aaj Tak Anchor Activation

Present Sona Jeeto - Contest

present Movie Masala Award -event & Budget 2011 pitch

IPL contest

Present post evl of Blue eyed campaing

Present post evl and finsing of Anchor Activations

Present Sonajeeto success and pitch for MM awards, Pitch for Budget Sch

MM awards post event and pitch for IPL contest

Advertising

TV Ads Print Ads Radio Ads

Advertising Strategy

Persuasion Advertising

“Ghar Aa Gaya Hindustan”

“India Comes Home in Maruti Suzuki.”

“Papa Ki Karaa petrol khatam hi nahi Hota”

Information Advertising

Page 13: Maruti Final2

Alternative Advertising Options

BTL - Sponsorships

TV shows - India’s Got talent

Place Advertising – Bill boards

16.1

12.8

12.37.210.97.5

3.1

4.9

2.5

4.50.61.6

1.30.8

1.90.3

0.64.4 2.3

0.8 1.1 2.5

Avg Share % Aaj Tak Star NewsIndia TV NDTV IndiaZee News IBN 7Samay TEZLive India News 24Voice of India India NewsNDTV 24x7 CNN IBNHeadlines Today Times NowNews X Bloomberg UTVCNBC AWAAZ CNBC TV18ET Now NDTV ProfitZee Business

Chart - % of advertisements on different channels by Maruti (Source Mrs. Manisha Motiramani – Branding & Sales Promotion Manager – AajTak)

Promotional Strategy-

• Maruti Driving School

• Adoption of state running

• CSR programs

• Sponsorship of Rode race e.g. Maruti Raid De Himalaya

• Sponsorship of other sports like golf and polo

Also Nakanishi took over as MD from Jagdish Khattar last year. He has strategic plans designed for brand promotions of all Maruti brands in the country. Maruti Suzuki has decided to open a company owned brand stores in major cities of India.

Page 14: Maruti Final2

The company plans to showcase the entire product range under one roof. These showrooms will not be actually retail outlets but brand promotion counters that will familiarize customers with the models and features of various cars.

This idea of opening brand showrooms is in line with company’s plans to invest in marketing infrastructure and brand building initiatives that aim at improvising customer experience with Maruti Suzuki.

“Customers can test drive the cars, familiarize themselves with various features and then purchase them from dealer outlets.”

SOCIAL AND ETHICAL ISSUES

In the past decades, increasing amount of attention has been devoted to culturally and ethically sensitive approach in business and marketing. Marketing managers have become ethically more sensitive, and they are largely convinced that customers and the public expect them to act in a morally acceptable way.

Thus it revolves around one fundamental quest to position brands in an integrated way addressing ethical and cross-cultural issues. The basic problem premise was to empirically explore the strategy “Maruti” would use in positioning their brand in an Ethical way. The methodology is that five basic elements of brand positioning are identified (Brand Identity, Brand Image, Brand Personality, Brand Awareness, and Brand Communication) and these elements of brand positioning and their consisting variables are defined and blended with ethical & cross-cultural issues.

After generating a statistically significant framework a predictive model is developed. Here the core idea is that “Maruti” has used ethics and cultural variables as product differentiators and has created a strategic advantage for the brand, therefore restating the importance of ethics as the basic variable of business and delivery of promised benefit by the brand to the consumer. Maruti's Strategy suggests that the brand can use various implicit and sublime variables of culture and can create a differential positioning.

Page 15: Maruti Final2

CONCLUSION & ANALYSIS

In order to conclude Maruti is running at a very high pace matching with all the upcoming technologies. It has more than 5 million satisfied customers in India and is currently having a share of around 54% in the domestic passenger car market where major international automobile manufacturers are present.

Moreover, Maruti having a network of 391 sales outlets across 230 cities all over India, the service network covers 1,113 towns and cities, bolstered by 2,142 authorized service outlets. The company’s change in strategy and emphasis on developing effective marketing communications began to yield results. Wagon R an and Zen were ranked first and third in the premium compact segment.

As the competition is very intense, Maruti should also start laying more focus on making the integrated marketing communication more effective. Some stress and strategies should also be given on internet marketing as this is the need of the hour.

Additionally, the company should start working on direct selling and promotion by sending emails and letters to both existing clients as well as other prospective customers to increase the demand. It is also ranked highest in customer satisfaction with after sales-service, it should try to maintain this USP throughout because of which Maruti’s consistent performance in the study over the past several years has resulted in a steady increase in the percentage of its customers who say they intend to remain loyal to the brand