Rural Marketing of Hero Honda

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UNIVERSITY OF MUMBAI’S ALKESH DINESH MODY INSTITUTE FOR FINANCIAL & MANAGEMENT STUDIES 1

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NAME OF THE STUDENT ROLL NOS SIGNATURES AHSAN KHAN 45 AJAY DHUTAWALE 11 ARUN IYER 28 ANAS KHAN 48 VIKAS GUPTA 25 VIVEK KAMBLE 39 2 SYBMS SEM IV Submitted to :- Prof. Sushmita Mam

Contents : 

Contents Company Profile Sayings ………… Growth Strategies Rural Marketing Strategies Corporate & Social Responsibility Challenges in Rural marketing Conclusion

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“Hero” is the brand name used by the Munjal brothers in the year 1956 with the flagship company Hero Cycles. It is a joint venture between India's Hero Group and Honda Motor Company. It established in 1984 as the Hero Honda company, India. During the 1980s, the company introduced motorcycles that were popular in India for their fuel economy and low cost. COMPANY PROFILE

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Hero Honda has three manufacturing facilities based at Dharuhera and Gurgaon in Haryana and at Haridwar in Uttarakhand. These plants together are capable of churning out 3.9 million bikes per year. Hero Honda's has a large sales and service network with over 3,000 dealerships and service points across India. Contd………………….!

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" The majority of India lives in rural areas and the government is pumping in a lot of money through various programmers. Hero Honda is focusing a lot on rural markets. Going forward, a substantial industry growth is expected to come from these markets.” - Pawan Munjal, MD and CEO, Hero Honda Motors Limited, in May 2009 Sayings…….,

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“ The penetration of two-wheelers in rural areas is estimated to be less than 10 per cent and around 25 per cent in urban areas. This makes us optimistic about the market." - Anil Dua , Senior Vice President for Sales and Marketing, Hero Honda Motors Limited, in January 2009

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Growth strategies…!

Growth strategies : 

Growth strategies Concentrating On Rural Market Fuel-efficient Vehicles With Low Maintenance

Advertisements : 

Advertisements TVC ADDS….! Radio ….! Magazines…! X-change melas

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Adds……!

Foreign Collaborations To Assist In New Design And Production Process.: 

Foreign Collaborations To Assist In New Design And Production Process. Organize Free Service Camps

Hero Honda offers cheapest motorcycles in India, cost between 38,000 to 48,000. : 

Hero Honda offers cheapest motorcycles in India, cost between 38,000 to 48,000.

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Hero Honda has accepted by people because its strong brand image and product quality.

PUNCH LINE: 

PUNCH LINE The punch line of Hero Honda gives a emotional touch to customers “ DESH KI DADKHAN”.

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Rural Marketing strategy

Har Gaon, Har Aangan (every village, every courtyard.): 

Har Gaon, Har Aangan (every village, every courtyard.)

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1,00,000 of 6,00,000 villages in country. Penetration in Rural Market- 10% 500 Sales Representatives to meet potential customer ( local people as sales executives ) Average of 16000 bikes per month. ( sales ) Contd………!

Contd…..!: 

Contd…..! These representatives have been given work tasks and not sale targets - they need to meet potential customers and opinion leaders in villages. To strengthen their network in rural areas, the company started sales, servicing and spare part outlets in small towns and villages across India.

focusing on upgrading the models: 

focusing on upgrading the models The most successful product is SPLENDOR in rural market and the company kept on focusing on upgrading the models so, then they later came up with SPLENDOR PLUS and SPLENDOR NXG, which provided extra features and the consumers were satisfied.

Collection of data: 

Collection of data Under the rural vertical, they started collecting a lot of data at rural touch points; many of their dealers are now meeting, -SARPANCHES, -HEADMASTERS, -AANGANWADI - WORKERS and other opinion makers to understand the rural consumer better.

The company conducts,: 

The company conducts, SKITS DRAMAS To give some social message and attract the crowd and Advertise its products………..!

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Once you earn the villagers loyalty (and they are known for their brand loyalty), it will be difficult for competitors to take away your customers. Conted…….

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Corporate & Social Responsibility..

STAKEHOLDER TIES AT THE GRASSROOTS : 

STAKEHOLDER TIES AT THE GRASSROOTS Hero Honda Motors takes considerable pride in its stakeholder relationships, especially ones developed at the grassroots. The Company believes it has managed to bring an economically and socially backward region in Dharuhera, Haryana , into the national economic mainstream

Integrated Rural Development Centre : 

Integrated Rural Development Centre Centre has been set up on 40 acres of land along the Delhi-Jaipur Highway . The Centre-complete with wide approach -ROADS, -CLEAN WATER, -AND EDUCATION FACILITIES for both adults and children The Foundation has adopted various villages located within vicinity of the Hero Honda factory at Dharuhera for integrated rural development.

RAMAN MUNJAL VIDYA MANDIR : 

RAMAN MUNJAL VIDYA MANDIR The Raman Munjal Vidya Mandir began with three classes (up to class II) and 55 students from nearby areas. It has now grown into a modern Senior Secondary, CBSE affiliated co-educational school with over 1200 students and 61 teachers. The school has a spacious playground, an ultra-modern laboratory, a well-equipped audio visual room, an activity room, a well-stocked library and a computer centre.

RAMAN MUNJAL MEMORIAL HOSPITAL : 

RAMAN MUNJAL MEMORIAL HOSPITAL Multi-specialty hospital equipped with the latest diagnostic surgical technology. It provides healthcare to the RURAL POPULATION in and around Dharuhera, ACCIDENT AND TRAUMA VICTIMS driving along the Delhi- Jaipur highway . RAMAN MUNJAL MEMORIAL HOSPITAL

Raman Munjal Sports Complex : 

Raman Munjal Sports Complex Complex has basketball courts, volleyball courts, hockey and football grounds are used by the local villagers . In the near future, sports academies are planned for volley ball and basket ball, in collaboration with National Sports Authority of India.

Adult Literacy Mission: 

Adult Literacy Mission launched on 21st September, 1999 villages of Malpura, Kapriwas and Sidhrawali The project started with a modest enrolment of 36 adults. Hero Honda is now in the process of imparting Adult Literacy Capsules to another 100 adults by getting village heads and other prominent villagers to motivate illiterate adults.

Marriages of underprivileged girls : 

Marriages of underprivileged girls Marriages are organized from time to time, particularly for girls from backward classes, by the Foundation by providing financial help and other support to the families. Marriages of underprivileged girls

Rural Health Care : 

Rural Health Care Besides setting up a modern hospital, the Foundation also regularly provides , DOORSTEP HEALTH CARE SERVICES to the local community. FREE HEALTH CARE and MEDICAL CAMPS are now a regular feature in the Hero Group's community outreach program

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Challenges faced in Rural Market

Challenges …..: 

Challenges ….. The rural consumer values old customs and tradition. They do not prefer changes. The Infrastructure Facilities - Roads, warehouses, communication system, financial facilities are inadequate in rural areas. Physical Distribution bacame Costly

Contd : 

Contd The price its competitors are also becoming the threat. For example: bajaj auto’s platina is priced at 38,115. The literacy rate is low in rural areas as compared to urban areas. This again leads to problem of communication for promotion purposes.

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Limited Dealership :- The dealerships in rural areas is limited because of which the customer has to go to near by city to buy the product. Spare Parts :- of Hero Honda are costlier than other companies spare parts, so there is problem for rural people to afford.

WHY COMPANY CHOOSE RURAL MARKET : 

WHY COMPANY CHOOSE RURAL MARKET Hero Honda has worked out a major expansion strategy for the rural markets and is planning to strengthen retail financing to support the initiative that could lead to setting up of its own finance arm. Pawan munjal, MD of Hero Honda, told TOI that rural market would be a special focus area for the company as it is looking at new growth areas to maintain sales momentum in a shrinking market. "We have created a special ‘rural vertical' to push growth and this would spearhead our expansion in the rural market,' Munjal said.

contd: 

contd India's largest two wheeler company Hero Honda Motors is spreading its wings to capture the commuting bikers' imagination in rural India, after witnessing flat sales growth in 2007-08. The two wheeler market leader plans to cover 100,000 of the 600,000 villages in the country by the end of this financial year under a campaign named Har Gaon, Har Aangan (every village, every household).

CONCLUSION : 

CONCLUSION Most of the Hero Honda Bikes are purchased by young generation 18 to 30 because they prefer stylish looks and rest of the models of Hero Honda are purchased more by daily users who needs more average of bikes than looks. Hero Honda is considered to be most fuel-efficient bike on Indian roads. Service & Spare parts are available throughout India in local markets also.

contd: 

contd While buying a motorcycle, economy is the main consideration in form of maintenance cost, fuel efficiency. Hero Honda started growing in rural market rapidly with its add campaign and promotion strategies in rural market.

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Thank You..!