hero honda 1

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MARKETING STRATEGY OF

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COMPANY PROFILE GROWTH STRATEGIES RURAL MARKETING STRATEGY CHALLENGES FACED IN RURAL MARKET INDEX

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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.

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Hero Honda’s important strategy is that they are concentrating on rural market a lot because majority of people are living in rural areas and government are pumping in a lot of money through various programs by which substantial growth is expected to come from these markets. They produce products (motorcycles) which are fuel-efficient and have low maintenance. They give advertisements in different media vehicles time to time by which customer attention is achieved. GROWTH STRATEGIES

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Hero Honda use foreign collaborations to assist in new design and production process. To build a strong customer relationship they also organize free service camps every year. Hero Honda offers cheapest motorcycles in India, cost between 38,000 to 48,000. The punchline of Hero Honda gives a emotional touch to customers “DESH KI DADKHAN”. They focus on “Quality”.

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A rural vertical was set up sometime in 2007. Five hundred sales representatives were taken on board for the mission Har Gaon , Har Aangan (every village, every courtyard.) 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. Rural Marketing strategy

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The company has recruited local people as sales executives and trained them to markets its product to rural customers because the local recruited person knows, the taste and preference of the consumers. 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. 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.

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The company conducts skits or drama’s in villages and give some social message. it attracts the crowd and advertises its product. 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.

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Key products

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HERO HONDA BAJAJ PICK UP =80% MAINTENANCE= 62% DESIGNS=80% BRAND IMAGE=55% PICK UP =70% MAINTENANCE= 58% DESIGNS=85% BRAND IMAGE=53% VS

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The rural consumer values old customs and tradition. They do not prefer changes. The Infrastructure Facilities like roads, warehouses, communication system, financial facilities are inadequate in rural areas. Hence physical distribution became costly due to inadequate Infrastructure facilities. The price its competetors are providing is also becoming the threat. For example: bajaj auto’s platina is priced at 38,115. Challenges faced in Rural Market

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Rural areas are scattered and it is next to impossible to ensure the availability of a brand all over the country. The literacy rate is low in rural areas as compared to urban areas. This again leads to problem of communication for promotion purposes. 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.

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