MARKETING PLAN FOR HONDA BRIO SEDAN

Presented By:
Sneha Raina 9 Pritesh Salian 30 Mayank Mehta 49 Ananya Kumar 71 Ashwin Verma 106

Indian Automobile Industry

Largest 3 wheeler market in the world 2nd largest 2 wheeler market in the world 7th largest Passenger car market in Asia & 10th Largest in the world 5th largest commercial vehicle market in the world Population of automobiles in India more than 110 million and growing at the rate of 12% p.a.

Passenger Vehicles Market

Passenger car sales increased by 4.24 % Passenger cars are expected to grow at 10-12% The passenger vehicle market of India will cross Japan by 2017-18 Indias passenger production projections: 2010-2.6 million 2015-5.1 million 2020-9.7 million vehicle

Factors Contributing To Growth Of PVs

Passenger Car Penetration In India

Sedan Market in India

Second largest by volume
Car sales grew by only 2.8% in May, citing high fuel prices and interest rates on retail loans

Sedan segment has grown by 37% in May this year

Entry level and mid-size sedan cars priced between R6 lakh and 10 lakh are one of the fastest growing categories in cars Diesel variants continue to grow at healthy double digit levels

Target Market Demographics

Honda has 6 models in its portfolio Brio, Jazz, City, Civic, Accord, CR-V Honda has segmented its market in a way that its Accord & CR-V is for Elite class, Honda Civic for Upper Middle class, Honda City, Brio and Jazz for only Middle class Demographic: 30 -50 years old M/F; Social Class AB; Single and Married Inclined towards younger buyers Lifestyle: Working class, Established in work and has buying power, fairly successful, wants value for money and prestige in what they drive Behavior Factors: Replaces car every 5-7 years, Efficient fuel consumption

SWOT ANALYSIS
Strengths: Strong Brand Equity Loyalty rate of 62% Annual advertising Budget: $700-800 Million. Honda Brio (Hatchback): One of the best selling cars in India Premium products

SWOT ANALYSIS
Weaknesses: High cost structure Relies heavily on Civic and Accord (Sedans) which contributes 55% to the total sales Depends on North America for 85% of its profits Honda Brio sedan only the first Honda car to have a diesel engine

SWOT ANALYSIS
Opportunities: Cater to the middle class segment of customers Extend the existing variants to Diesel engines Launch a Hybrid version Enter emerging markets

SWOT ANALYSIS
Threats: Strong competition from the existing players like Maruti Suzuki, Hyundai etc. Rising fuel prices Growing popularity of Hybrid/Fuel efficient cars. Government policies for the Automobile sector

Product Details

Type: Sedan

Expected Launch in India: Fourth Quarter, 2012

Fuel type: Diesel

Seating Capacity: 5

Product Details
Distribution: Distribution through a network of 137 authorised dealership facilities in 85 cities. Target Audience: Middle and upper middle class. Competitive pricing. Services: Honda dealership centres are based on the "3S Facility" format, offering complete range of Sales, Service and Spares services to its

Marketing Strategy
Mission: Support the current sales To enter the entry level sedan (C1)segment sedan market To enter the diesel segment Increase the market share Target the untapped market

Marketing Objectives

Increase the market share in Sedan segment. Increase the total number of units sold.

Total Units sold are less due to absence of mid-segment sedans.

Source:

Marketing Objectives

Increasing customer base by entering Diesel segment. Increase the overall market share from 4.86% to 10%.

Competition Analysis

Direct Competitors

Verito

Indigo Manza

Dzire

Etios

Attributes and Pricing

Maruti Suzuki Dzire Toyota Etios Tata Manza

Engine

Petrol
1.3 litre 85.8bhp AlTec32 engine

Diesel
1.3 litre 73.9bhp DDiS engine w/ Common Rail multi injection technology

Petrol
1.5-litre 88.7bhp 16Valve Petrol Engine

Diesel
1.4-litre 68bhp 8V SOHC Diesel Engine

Petrol
1.4-litre 4 cylinder 88.8bhp, MPFI, Petrol With Intelligent Port Resizing

Diesel
1.3-litre 88.8bhp 16V Common Rail Diesel Engine

Price

Rs 5,13,270*

Rs 6,25,429*

Rs.5,41,185*

Rs 6,73,507*

Rs 5,89,898*

Rs 6,65,650*

*Ex Showroom Mumbai

Approach Observed - Value Based Pricing

Indirect Competitors

Price - Rs 5,81,882* - Rs 7,36,439

Price - Rs 5,06,000* - Rs 6,43,639*

*Ex Showroom Mumbai

Current Target Markets

Mid Size Hatchback (B2 Segment)

Brio

Premium Hatchback (B2 Segment)

Jazz

Mid Size Sedan (C2 Segment)

City

Luxury Sedan (D2 Segment)

Accord

Compact Luxury SUV (D2 Segment)

CRV

Positioning
Earlier Positioning Based on Pricing Present Positioning Based on Competitors

Marketing Mix
Product Brio Sedan

Based On
The Brio Platform

Petrol Displacement Maximum Power Maximum Torque

1198cc, i-VTEC 88 Bhp @ 6000 rpm 109 Nm @ 4600 rpm

Diesel Displacement Maximum Power Maximum Torque

1198cc, i-DTEC 70 Bhp @ 4500 rpm 170 Nm @ 2000 rpm

Price
Petrol

Honda Brio sedan E MT Rs. 5, 15, 000 Honda Brio sedan S MT Rs. 5, 67, 000 Honda Brio S Option MT Rs. 6, 60, 000
Honda Brio sedan E MT Diesel Rs. 6, 15, 000 Honda Brio sedan S MT Diesel Rs. 6, 79, 000 Honda Brio S Option MT Diesel Rs. 7, 60, 000

Diesel

Promotion
1) Television: 20 repetitions per day for the first 3 months across 5 channels. Around 10 repetitions for the next three months across 5 channels. 2) Radio: 10 repetitions for 3 months across 4 channels. 3) Hoardings: 200 hoardings for 3 months across 20 cities.

Place

Current Dealership Network

Strategy
Pull Push Strategy

SALES FORECAST

Sedan Segment grew by 37% in May, 2012 Entry level Sedan grew by 40% Share of Diesel cars in the entry level Sedan segment grew from 60% to 85% C1 Sedan segment is expected to grow by 28% Sales forecast accounting for 8-10% of the C1 segment

BREAK EVEN ANALYSIS

Break Even Chart
250000 200000

Sales Value

150000
100000 50000

3721.73 Million

Revenue Total Cost 5838

0 0 10000 20000 30000 40000

No. of Units
Excel Working

BREAK EVEN CALCULATION

Contribution Margin Ratio = Selling Price Per Unit Variable Cost Per Unit/Selling Price Per Unit*100 =637500-385000/637500*100 =39.61% Break Even Sales = Fixed Cost / Contribution Margin Ratio =14742/39.61% =Rs 3721.73 Millions or 5838 units

Remuneration

The remuneration offered in Honda Cars India may differ on the basis of various attributes such as candidates qualification, experience, job profile, and so on. Generally speaking, the pay scale offered by the Automobile Sector is comparatively better when compared to the other sectors. The B.Tech / B.E in Automobile Engineering graduates can earn a good salary in the starting stage itself. The average monthly income for them would be around Rs. 20,000/- and the salary will rise after the training period.

Honda Hiring

As a strategy for hiring, more than 80 percent of Honda hiring is of fresher or people with less than five years of experience. Honda Pay Scale Executive- Approx 4,10,000 to 4,44,000 includes Bonus Warehouse Executive- 3,70,000 to 4,20,000 plus around 70,000 as Bonus Senior Executive-3,70,000 to 4,20,000 plus around 24,000 as Bonus Exclusive Dealer Trainer-4,06,000 to 5,00,000 plus around 16,000 as Bonus Most Popular States for Dealership are kerala and Maharashtra for Honda Cars

QCC

Quality Circles are (informal) groups of employees who voluntarily meet together on a regular basis to identify, define, analyze and solve work related problems. Usually the members of a particular team (quality circle) should be from the same work area or who do similar work so that the problems they select will be familiar to all of them. In addition, interdepartmental or cross functional quality circles may also be formed.

An ideal size of quality circle is seven to eight members. But the number of members in a quality circle can vary.

Objectives of Quality Circles

Promote job involvement Create problem solving capability Improve communication Promote leadership qualities Promote personal development Improve morale through closer identity of employee objectives with organization's objectives

Kaizen Method

Helpful For Global Company

Localisation Suggestions for Improvement

GET PROGRAM

Structured job rotation program for multi-skilling Training at our overseas facilities for technical skills transfer Assignments with expats for know-how learning Assigning expats as Project members or leaders for important company wide projects

Sending people to work in overseas factories for two to three years to develop managerial skills, cross cultural experiences and developing leadership skills besides regular skill enhancement

Hondas Philosophy

Respect for individual Creation of three joys Equality, initiative and trust e.g.-Honda has common canteens, locker rooms, and uniforms, which at an external level give a feeling of oneness

On-the-Chance training

Higher levels of engagement Process of giving calculated and pre-planned chances in the way of projects and assignments away from normal work.

Helps in honing skills and uncovering potentials that were previously unknown

Employees are encouraged to reach out to the management with various solutions about what they feel will work rather than asking them what needs to be done

Hondas Guiding Principals

Transparency in our decision making processes and consensus in reaching decisions that impact our associates

Pursuing equality in our dealings, systems and processes that reduce the perceived "divide" between the management and line associates
Constant communication with union and also associates on the shop floor through daily morning meetings , joint welfare committee meetings [ e.g. canteen, transport, insurance etc.], regular union-management interface, joint participation in CSR activities and community service etc. Speed in resolving grievances and personal related issues One-on-one interactions of selected Vice President level staff with the unions for sharing business outlook, challenges, priorities, cost data etc. and also hearing the concerns and priorities of the shop floor associates

Giving a clear career path to our line associates to graduate on to supervisory and managerial positions within the company. Today, Honda have more than 70 people who have graduated on to positions of Team Leaders and above. While it may seem like a very simple concept, but before such transitions, Honda also take them through a well-structured program that includes exposure to relevant skills, training in personality grooming, English, Computer skills, data analysis etc

Executive Selection Scheme

Honda motors has always strived towards excellence both in its efforts towards total integration as well as in recognising its talented employees. The Company is constantly creating prestigious programmes to reward and retain its outstanding employees. IESS is a fast track programme for accelerated growth of high potential . The selection involves a 3 stage process:* Written Test* Power Interview* Assessment Centre Short-listed candidates are required to go through an interview with the executive directors. They are promoted to Manager's level thereby saving almost 10 to 13 years of work time.

Honda- Contingency

Honda is ready to face the cyclic changes that are here to stay. Today it may be petrol price hike or the adverse exchange rate impact. It is very important that corporations build internal constitutions that are more resilient to wide fluctuations in their business fortunes, are agile, and more predictive than being reactive and have lean operations Regular communication with stakeholders, including employees is the key to managing anxieties during lean phases of business cycle, undue expectations during good times and fear and rumors during bad times. Being honest and upright with clear sharing of information at all times by the management goes a long way in soothing such anxieties.

THANK YOU