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Introduction
Indian MUV market In 21st century Indian automobile industry is expected to pick up momentum Entry of many domestic and foreign players into various segment of the market with a huge range of product offerings In late 1990s the Indian automobile industry experienced a severe downturn in sales on account of global depression during that period In 2002 the turnover of the Indian automobile industry was Rs. 498 billion MUV stands for Multi Utility Vehicles MUV market was divided into Multi purpose vehicles (MPV), Rural transport vehicles (RTV) and Sports utility vehicles In 1990s the MUV market was dominated by RTV and MPV In 21st century the MUVs began targeting the urban market The MUV market in India can be subdivided into three parts
1. 2. 3.
Soft tops (Mahindra Commander and Pushpak, Maruti Gypsy) Hard tops (Scorpio,Bolero,Qualis and Tata Sumo) Pickups (Mahindra Pickups)
Cont.
Mahindra & Mahindra Ltd.(M&M) In 1945 Mahindra &Mohammed was formed In 1949 the company was renamed as Mahindra & Mahindra Mahindra & Mahindra is flagship company of the Mahindra group M&M was set up in 1945 to make general purpose utility vehicles M&M expanded its operations to include tractors and LCVs in product profile Mahindra brand became synonymous with high quality, reliability, durability , ruggedness ,easy maintenance and operational economy in UV market In early 21st century M&M was divided into two major operating divisions 1. Farm equipment 2. Automotives
In year 1996 M&M decided to implement a new product development strategy technique called Integrated Development & Manufacture (IDAM) M&M roped in Lucas engineering to help it with IDAM M&M invested Rs.6 billion on Project Scorpio was the largest project ever initiated by the company A team of 120 members worked full-time on Project Scorpio Project Scorpio took 6 years to complete M&M undertook extensive market surveys to understand changing customer
needs and expectations during these 6 years Aggressive pricing and promotion strategy use for penetrations in the market M&M launched Scorpio in June 2002 in both petrol and diesel engines 1000 Scorpio cars were sold in its first month and a total of 15000 Scorpio cars were sold in one year Leading automobile magazines and auto analysts in the country gave Scorpio top ratings on aspects such as style, performance, power, driving , technology , interiors , driving comfort and value for money Success story of Scorpio attracted many domestic & foreign players to the SUV market by mid 2003 In UV segment with a market share of approximately 54% M&M remained the leader in September 2003 Revenue of M&M increased by 37% ,up from Rs. 18.28 billion to 25.11 billion in 2002-2003
Market share
Company M&M Telco Toyota Bajaj Tempo Martuti 8.6 2.7 5.8 2.6 5.3 4.5 5.1 7.3 1997 71.6 14 1998 52.2 32.7 1999 58 28 2000 58.7 26.7 2001 44.9 24.4 20 3.9 4.9 2002 46.2 21.7 20.4 4.2 4.8 2003 50.2 21 20.8 4.7 2.4
Case Analysis
Product
SCORPIO Consumer Durable product SUV(sports utility vehicle) Variety of color and modal , engine, seat, Chassis , Best mileage in SUV segment, Power, spacious, rough and tough and variants in fuel engines. 7-8 seat Use in long journey, adventure and family car
Price
price kept 52000-70000 less than the competition (Toyota qualis and TATA safari)
USP (unique selling point)
Scorpio was delivering low price in SUV segment great power and style within price, are making Scorpio
Aggressive pricing strategy ( To capture market Scorpio Toyota qualis TATA safari share)
550000-720000 560000-850000 760000-850000
Place
Scorpio penetrated urban and rural area in across the
India and targeted individual car buyers in top-small car and mid size car segment . Scorpio was available in every M&M showroom.
20 sales offices 150 dealers 100 authorized service center
Promotion
Aggressive promotion campaign Tagline; nothing else will do Road shows Multimedia Ad. Campaign
a) b) c) d)
Tied up with banks and Financial Institutions Test Drive (anytime and anywhere) Customer care service (free toll free no) Answering Queries
Scorpio was positioned as UV with great power and style that offered the ultimate driving experience , driving thrills, luxury, and comports of a passenger car along with value for money.
Positioning
POP
Ruggedness Durability
POD
Power
Tough looks
SUV (sports utility vehicle) Spacious Passenger car
Durable
luxury
Spacious
Powerful
Adventure
Core Benefits
Powerful Luxury Spacious Comfort Economic
Brand Mantra : Multi utility Vehicle Spacious with power Rough and tough (long time Assets)
SALIENCE
1. IDENTITY =
CBBE Salience
Thrill, Luxury and Comfort
Performance Product : color, engine, seat, Chassis , Best mileage in SUV segment, variants in fuel engines Service : Car Loans, test drive at ones own place , Customer care services Pricing : Low in SUV segment Low maintenance cost
CBBE
Imagery
For Adventures people Mahindra & Mahindra (Rough & Tough) Value for money For long rash roads
Feelings
Value for money Comfortable for long drives Excitement Status Symbol Ease of driving
CBBE
Judgment Quality & Credibility (Luxury + Sporty with low price) Resonance Engaged with customers with website called www.mahindrascorpio.com
rental companies, travel agencies, traders, contractors, taxi owners, government departments and the armed forces. Competitors: Qualis, Tata Sumo, Tata Safari, Bolero Similarity to competitors: engine, space, power and passenger car .
Scorpio
Declining Leaders
Conclusion
M&M has great brand equity Know as MV and rough and tough vehicle Help to building brand extension (Scorpio) IDAM help M&M to reduce cost and enhance the quality Able to make aggressive price range Promotion activity Aggressive promotion activity help to make customer
Question Question.1. Examine the M&M evolution over the decade ,explain the
circumstances that forced the company to restructure its strategies in mid 1990 M&M evolution : Set up in 1945, flagship of Mahindra group catering to major business sector in India and aboard. In 1994 , M&M was divided into farm Equipment & automation By the 21st century, M&M had a varied Customer Profile Restructure its strategies : Market scenario changed in 1990, India's biggest truck manufacture Telco and Toyota etc entered in Multi utility vehicles market segment M&M launched the armada in 1993 and later bolero was launched, which was not profit generator Farm equipments depend in agriculture. 1996 launched big the project for Scorpio
Q.2.critically analyze the project Scorpio focusing on the product development and manufacturing strategies adopted by M&M. Do you think M&M succeed in its attempts ? why /why not? The investment on project was 6 billion. M&M set up a new plant at nasik in maharashtra to manufacturing Scorpio Integrated Design And Manufacturing (IDAM) Collaborated with Different company for different parts of Scorpio (fukui,fuji,AVL and Renault) 19 cross functional team 120 members Minimized the cost and increased the quality
YES M&M succeed in its Attempts
Strategy of design to cost 6 year market surveys understood well to consumers need and expectation for
made the Scorpio the leader of the SUV market , To what extant do you think that product like positioning , pricing , advertising and promoting contribute the success of an automobile .justify your answer and give examples. Slides
Promotions and advertisement Pricing
Thank YOU