WEL COME
Presentation
of
CASE STUDY
Presented By:
Sachin .
MBA-II
Prabhakar.
“Consumer Buying Behaviors
in
Two Wheeler industry
With Special Reference to
Hero Honda Motorbike”
“ Movement is the essence of life &
change is only constant in the
movement.”
Introduction :
The dawn of new millennium has pushed the
world in to age of an unprecedented velocity where
loads of information travel at supersonic speed over
great distances which has left sphere of human
activity untouched .
The cyberspace has also changed the way of
doing business where consumer always
supreme.Today no business irrespective of its size
can remain indifferent to changing consumer
demands.
What is Marketing ?
Marketing Mgmt :
This customer focused philosophy is known as the
‘marketing concept’.
The marketing concept is a philosophy, not a
system of marketing or an organizational
structure.
It is founded on the belief that profitable sales and
satisfactory returns on investment can only be
achieved by identifying, anticipating and
satisfying customer needs and desires.
- Drucker
What
is
Consumer Behavior ?
“ Consumer Buying Behavior is the decision
processes and acts of people involved in buying
and using products ”.
Need to understand:
•why consumers make the purchases that
they make?
•what factors influence consumer purchases?
•the changing factors in our society.
Objectives of Case:
1. To make complete analysis of the Indian two wheeler
industries with specific preference to Hero Honda.
2. To find out awareness level of consumers regarding
number of brands that are available in market.
3. To find out important factor influencing the purchase
decision of buyer.
4.To rate the product features or factors of consumer
preferences towards different models
(100 cc, 110 cc,125 cc etc).
5.To find out post purchase behavior of the consumers
about product and brand.
Summary of Case:
Automobile industry is fastest growing in our country it
has two reasons,
1.Change of lifestyle.
2.People from metropolitan cities are disappointed with
public transport.
This case tells about comparative study of Indian two
wheeler industry, the study based on two hypothesis.
1.Association between the income of consumer and the
type of two wheeler owned by him.
2.Hero Honda Company considered as market leader
in two wheeler industry.
Both consumer and dealer survey was conducted .
The sample size for dealer and consumer was 20
and 150 respectively.
The study was conducted in Hyderabad city.
Overall case shows the change in view point of
consumers towards modern bikes.
Outlook of Two Wheeler Industry:
•India is the third largest producer after Japan
and china, the second largest consumer after
china.
• Two wheeler are usually classified into three
types, they are scooters, motorcycles and
mopeds.
• The major players of two wheelers in India are
Hero Honda, Bajaj Auto, and TVS Motors.
•As these companies announced their sales for
April 2004, it shows that
Hero Honda sales grew sharply by 46%.
Bajaj Auto increased by 24%,on other hand
TVS Motors Decreased by 4.4%.
Current Scenario:
The market has steadily moved from sellers to buyer
market .
During the early nineties the auto industry in general was
under recession.
After the 1996 the industry showed a slower growth
around 22%, compared to 1990-91.Whereas the
motorcycle sales increased by 77% in 2004.
Automobile Sector
Speeding Ahead!!
- Chartered Financial Analyst ( Feb-06)
AUTO SECTOR MARKET SHARE:
AUTO SECTOR MARKET SHARE
4%
4%
Two wheeler
13%
passenger
Vehicle
Commertial
vehicle
Three wheeler
79%
The two wheeler segment leads the industry
with big share of around 80%
Current Market Situation:
• The two wheeler segment continues dominate the auto
sector due to growing numbers of middle class
consumers.
• Price discounts , Attractive & easy finance schemes and
the launch of new models at frequent intervals have all
helped this segment increase its shares from 77% in
FY2004 to 79% in FY2005.
• Hero Honda the market leader in two wheeler has record
of selling more than 29 lakhs units, and registered an
average growth of 24.6% in last five years period.
• Bajaj auto followed HEROHONDA with a market share of
20% in the two wheeler segment.
• For FY2005, compared to 24% during the previous year.
• The other major automobile manufacturers TVS motors
however is losing ground.
• Custom duty reduced by Government from 25 to 20%
will help the manufacturer to reduce expenditure on raw
material (RM).
Company
Market Share:
%
Hero Honda Ltd.
46%
Bajaj Auto Ltd.
24%
TVS Motors Ltd.
17%
LML Ltd.
5%
Others
8%
Market share
LML
1
others
2
3
TVS
4
5
Bajaj
Hero Honda
Why
HERO HONDA
is
Leading Market ?
Company Profile:
Mission:
“Hero Honda, is continuously striving for synergy
between technology, systems and human resources to
provide products and services that meet the
quality,performance, and price aspirations of our
customers.
While doing so, they maintain the highest standards of
ethics and societal responsibilities, constantly innovate
products and processes, and develop teams that keep
the momentum going to take the company to excellence
in the new millennium.”
BOARD OF DIRECTORS:
Chairman
Mr.BrijmohanLal Munjal
Managing Director
Mr. Pawan Munjal
Joint Managing Director
Mr. Miki Yamamoto
Wholetime Director
Mr. Takao Eguchi
Non-Executive Director
Mr. Satyanand Munjal
Non-Executive Director
Mr. Om Prakash Munjal
Non-Executive &
Independent Director
Mr. Satoshi Toshida
Products:
• Pleasure
• CD100SS
• Karizma
• Achiever
• Splendor+
Products:
• Glamour
• Passion Plus
• CD Deluxe
• CD DAWN
• Super splendor
Products:
Products:
Products:
Products:
Products:
Products:
The Legend of Hero Honda:
What started out as a Joint Venture between Hero Group, the world's
largest bicycle manufacturers and the Honda Motor Company of
Japan, has today become the World's single largest two wheeler
Company.
Coming into existence on January 19, 1984, Hero Honda Motors
Limited gave India nothing less than a revolution on two-wheels,
made even more famous by the 'Fill it - Shut it - Forget it ' campaign.
Driven by the trust of over 5 million customers, the Hero Honda
product range today commands a market share of 48% making it a
veritable giant in the industry.
Add to that technological excellence, an expansive dealer network,
and reliable after sales service, and you have one of the most
customer- friendly companies.
ANALYSIS OF CONSUMER SURVEY:
Current Status
33
yes
no
72
Current Status:
Particulars Respondents Percentage
Yes
72
68.57
No
33
31.43
Total
105
100
[68.57 % respondent have own vehicle & 31.43 do
not have own vehicle.]
No.of Respondants
Brand
Respondents Percentage
Hero Honda
48
66.67
Bajaj
18
25
T.V.S.
6
8.33
Total
72
100
60
50
40
30
20
10
0
No.of
Respondants
Hero Honda
Bajaj
T.V.S.
Brand wise Ownership of two wheelers:
[ 66.67 % of respondents have Hero Honda vehicle,
25%- Bajaj vehicle,
8.33 –TVS vehicle.]
No.of Respondents Percentage
Advt. In news paper
18
25
Advt.on television
12 16.67
Info. From friends
42 58.33
Total
72
100
Information needs for purchase decision
Advt. In news paper
Advt.on television
Info. From friends
Information needs for Purchasing decision:
[ 58.33 % respondents depend on friends for
information & 25% depend on news paper,16.67
on television .]
No. of
Respondents Percentage
Self
30
41.67
Spouse
6
8.33
Colleagues
9
12.5
friends
27
37.5
Total
72
100
Influence on purchase behavior of the
respondents
Self
Spouse
Colleagues
friends
Influence on the Purchase behavior of the respondents:
[ 41.67 %respondents influenced by self,
37.57 by friends
12.5 % by colleague,
8.33% by spouse.]
Reasons for Brand Preference
Reasons
Respondents Percentage
Margin
2
10
Price
4
20
Discount
2
10
Brand image
12
60
Total
20
100
Margin
Price
Discount
Brand image
Reasons for Brand Preference:
10% dealers prefer particular brand for margin,
20% -Price,
10% -Discount,
60 – Brand image.
Reasons for changes in
Consumer preferences:
•Motor cycle prices have declined comparatively to
scooter.
•Price in aspiration level and westernization.
•For rough and uneven roads like in rural areas,
strong Fuel efficient motorcycles preferred by the
consumer.
Findings & Conclusion:
The following are the major findings from the consumer survey
1.The study reveals that 88.5% of the respondents are
aware of the Various brands of the two wheeler available in
the market through watching TV And reading news paper
or magazines.
2.The study reveals that 93.35% of the respondents can
recall the advertisement Of motorbike they have seen
recently on TV or reads in newspaper or magazines.
3. It is found that 68.57% of the respondents own their own
two wheelers
Whereas remaining 31.43% of the respondents do not own
two wheelers.
4. It is found that 66.67% of the respondents own Hero
Honda,25% of the Respondents own Bajaj, 8.33%of the
respondents own TVS.
5. It is found that 75% of the respondents have the two
wheeler since 1 to3 years 9.72%of the respondents have
two wheeler since < 1 year, 8.33% of the Respondents own
two wheelers since >5years and 6.94%of the respondents
own it since 3 to 5 years.
6. The influencer in the purchase decision of the
respondents is himself.
7. The source of the information preferred by the
respondents for buying the two wheeler is collected
from the friends and associates.
8. It is found that 90% of the respondents are satisfied
with the performance ,Maintenance and after sale
services of the dealers ,Most of the respondents opined
that the maintenance cost of their Two wheelers are
affordable and some expressed that maintenance cost
is high and spares cost is also high.
9. It is found that 71% of the respondents do not have
any plans to buy two wheeler for themselves in
future.But 29.5% have plans to buy two wheeler in
the future .
10. It is found that most of the respondents preferred
to buy HERO HONDA due to its brand image.
Findings from the dealers
survey:
1. It is found that most of the dealership is non-exclusive
type.
2. it is found that if the dealership is of exclusive type ,
mostly it is exclusive to HERO HONDA company or Bajaj
company.
3. A reason behind the dealing with a particular brand is
brand image.
4. It is found that most of the respondents opined that
advertisement is a good enough source to improve sales.
5.most of the respondents opined that , the consumer
due to brand image prefer HERO HONDA Splendor.