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Inputs By
• Krutika Naik
•
• Pintu Bhardwaj
•
• Poonam Trivedi
•
• Antila Cheta
•
• Kunal Khandagale
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Introduction
• A Durable good or a hard good is a good which does
not quickly wear out.
•
• More specifically, it yields services or utility over time
rather than being completely used up when used once.
•
• These products are hard goods that cannot be used up at
once.
Types of Consumer Durables
Overview
• Demand for consumer durables has increased significantly
• Characterized by the emergence of MNCs
• Major target is the growing middle class of India
• Bargaining power of suppliers in consumer durables sector
is limited due to threat of imports and intense
competition.
• Some of the entry barriers in consumer durables sector
are distribution network, capital, and ability to hire
purchases.
• Demand is seasonal and cyclical
• Competition among players is on the basis of difference in
prices and well-acknowledged brands.
SWOT Analysis of Consumer Durables
Sector
Challenges and Outlook
Growth Drivers
Major Hurdles
• Rise in disposable income • Threat from new entrants,
• Availability of newer variants of especially global companies
a product • Rivalry and competition
• Product pricing • Potential markets remaining
• Availability of financing yet untapped
schemes • Threat from substitute
• Rise in the share of organized products/services
retail • Customer power with respect to
• Innovative advertising and availability of choice
brand promotion
• Festive season sales
Passenger Cars
Small Car Market in India : Overview
• India is the fourthlargest car market in Asia.
•
• Passenger cars come in great variety.
•
• Available in all ranges economical and luxurious.
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• Small car market in India is increasing by leaps and bounds.
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• Substantial share of around 70% of the annual car production in India .
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• Government is also mulling to boost the small car sector.
• Tata Motors, Maruti Udyog Limited, Mahindra & Mahindra, etc are the
leading Indian manufacturers.
•
• Foreign players such as Hyundai, Honda, Fiat, Ford, Toyota
Growth in the Sector
• At present the industry is enjoying a growth rate of 14
17% per annum
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• Domestic sales growth at 12.8%
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• Growth rate is predicted to double by 2015
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• Current growth rate indicates that by 2012 India will
overtake Germany and Japan in sales volumes
•
• Industry is consistently focusing on the automobile
exports.
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• Liberalized policies of the government
Why small cars are preferred in India?
• Fuel efficient when compared to midsize or luxury cars.
•
• Congested roads and small lanes.
•
• Compact and can be maintained pretty well
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• Reliable in terms of life and also resale value
Speed Motors Pvt. Ltd.
Executive Summary
Speed Motors is launching a new lowcost car, the MINTin
Indian markets. We will compete with existing companies by
offering a vehicle with better amenities while keeping the price
affordable.
We are targeting the rapidly growing middle class customers
who desire a slightly better lowcost car as well as businesses who
desire to add lowcost cars to their current fleets.
The size and buying power of the Indian middle class is rapidly
increasing, but price still remains the main driver when purchasing a
vehicle. Approximately 1.5 million new small cars are sold in India
each year and Tata, India’s leading vehicle maker, is looking to capture
a sizable chunk of that market with their recent introduction of the
Tata Nano . . . a subcompact car costing only $2,500.
To position ourselves successfully in this market, Royal is
targeting customers who may want a lowcost car that is a notch above
the Tata Nano. We also plan to offer optional features that are highly
valued by potential customers.
Speed Motors : Market Analysis
Speed Motors’ market consists of customers who are looking
for a lowcost car but want something a little better than what the
price leader offers. It also consists of customers looking for options
that allow them to customize their vehicle to some degree. In
addition, we will be marketing to businesses looking to add lowcost
cars to their fleets and concentrating on filling all orders in a timely
manner.
Lowcost car customers currently have very little to choose
from as far as options go. We will offer our customers the standard
options for lowcost cars (color, A/C, etc.), but intend to differentiate
ourselves by offering options above and beyond the norm . . . options
such as air bags,MP3 players, wooden dashboards etc.
Targeted Segment Customer Need Corresponding
Feature/Benefit
To be in style
Young Middle Class Network with tech toys Multiple color schemes
MP3 player
Fuel Efficient
Speed Motors : SWOT Analysis
Speed Motors : Competition
Analyzing the market situation following are our main
competitors in the passenger car segment:
Speed Motors : Competition
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•
Speed Motors : Marketing Objectives
Our main marketing objective is to focus on the customers'
wants and needs and, at the same time, offer a variety of options that
some customers may want. This will allow us to effectively influence
and persuade the customer to purchase from us.
The reason we decided to launch a lowcost car is to facilitate
families to travel together. The Indian market is rapidly changing to
where people can afford a car and spend time together. It virtually
frees them from a world of overcrowded trains, precarious rickshaws,
taxis they can’t afford and packed buses.
We want to provide a “Car 4 All”, which is affordable, yet built
to meet safety requirements, emission norms and fuel efficiency
standards. Every person who has a desire for a vehicle will look to
Mint to fulfill this need.
Speed Motors : Target Markets
The lowcost car is clearly intended for the masses; for the
firsttime car buyer in India – a huge market despite the increasing
number of cars in the urban and semiurban areas.
Our
target markets would be :
Speed Motors : Marketing Mix
Place
•
• We will distribute the Mint by developing private dealerships all over
the country in urban and semiurban areas.
•
• We will appoint distribution committees in each state which will
approve dealership ownership via financial background checks and
other verification methods
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• Our goal is to provide at least one dealership in each district area
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• We will also use these dealerships to provide maintenance services and
auto parts
Speed Motors : Marketing Mix
Promotion
Front and rear speakers Front air bags
Ashtray Choice of standard paint schemes
A/C Cell phone charger
Heater Tubeless tires
Power steering Seating for 5 people
Power windows Large trunk space
Options include:
Sun roof Alloy wheel
Sport paint scheme Premium speakers
MP3 player LPG/CNG kits
Speed Motors : Financial Objectives
• Our main objective is to capture between 6 and 7% of the Indian
market share with first year sales of 100,000 cars.
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• Our financial objective is to achieve $700 million in revenue the first
year and to keep losses at less than $150 million.
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• In our third year of production, our objective will then be to enter the
European and US markets.
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• With current safety, fuel efficiency and emissions standards, we would
need to make upgrades with additional air-bags, side-impact beams,
catalytic convertors and better fuel efficiency which would add $1000
to the cost of the vehicle.
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• At $8000 the Mint would still be far cheaper than any compact in these
markets.
Speed Motors : Controls
• We have developed routine audits that will monitor product quality
at our production facilities as well as surveys to measure
customer satisfaction.
•
• We have also put together a reporting system that will be placed at
maintenance facilities that will track maintenance issues with
our vehicles.
•
• In addition to these monitoring tools, we will closely track monthly
sales and expenses, being mindful of any deviation from the plan
and taking appropriate corrective action.
Speed Motors
Controls – Marketing Organization
Vote of Thanks
Thank you