Marketin Strategy of Honda Activa

A PROJECT REPORT ON

“Marketing Strategy of Honda Active I” In the subject Strategic Management

SUBMITTED TO UNIVERSITY OF MUMBAI FOR SEMESTER I M.COM (ADVANCED ACCOUNTING PART I)

BY NAME OF STUDENT

URMILA MISHRA ROLL NO (14-7291) YEAR 2014

DECLARATION

I URMILA POORANSANKAR MISHRA Roll No.14-7291, the student of M.Com. (Accountancy)

Semester

Dombivli, Affiliated to University of

I

(2014),

K.V.Pendharkar

College,

Mumbai, hereby declare that the

project for the subject Strategic Management titled “ To Study Marketing Strategy Of ACTIVA I “ submitted by Me to University of Mumbai, for Semester I examination is based on actual work carried by me.

I further state that this work is original and not submitted anywhere else for any examination.

Place : DOMBIVLI Date:

Signature of the Student NAME: URMILA P. MISHRA ROLL NO: 14-7291

ACKNOWLEDGEMENT It is a pleasure to thank all those who made this project work possible. I Thank the Almighty God for his blessings in completing this task. The successful completion of this project is possible only due to support and cooperation of my teachers, relatives, friends and well-wishers. I would like to extend my sincere gratitude to all of them. I am highly indebted to my subject teacher Mrs. Rajeshri Deshpande for her encouragement, guidance and Support. I also take this opportunity to express sense of gratitude to my parents for their support and co-operation in completing this project.

Name of the Student URMILA MISHRA INDEX

SR.N

TOPIC

PG.NO

O 1 2 3 4 5 6 7 8 9

Introduction Objective Research Methodology Data Analysis Scope And Limitation Concept Organization Finding & suggestions Conclusion

INTRODUCTION   MARKETING STRATEGY

5 7 8 9 19 20 24 33 34

Marketing strategy is the goal of increasing sales and achieving a sustainable competitive advantage. Marketing strategy includes all basic and long-term activities in the field of marketing that deal with the analysis of the strategic initial situation of a company and the formulation, evaluation and selection of marketoriented strategies and therefore contributes to the goals of the company and its marketing objectives.

The term "Marketing" is widely misunderstood. Many people when asked; "What is Marketing?", will respond with answers such as; "Producing TV advertisements", "writing catch phrases", "producing brochures", "a conspiracy to make people buy more than they need", "improving brand awareness", "fancy packaging", or "sponsoring the Olympics". In fact these are all part of Marketing, but only a small part. Marketers describe the above activities as promotions, which are designed to create awareness, interest, desire, and action among potential customers. Strategic Marketing, in addition to the promotions described above, also addresses issues such as; what products or services should we be involved with? How much should we charge for them? How do we make it easy for people to purchase our products? The simple question "What products or services should we be involved with?" is a massive issue. It encompasses; what do potential consumers want? What is the competition like? Will we make any money doing this? Do we have the capability to deliver what is required? Would we be better doing something else? Is the

market long term or short term? How do we address the market we have identified? Does the market break down into market segments? Etc.

The point of this is to emphasize that there is more to strategic marketing than is commonly understood. Strategic Marketing is defined in the "Marketing Concept", of which there are several different definitions, but all of them incorporate the broad definition of marketing alluded to above. By this project we came to know about the customer’s response towards this product. By analyzing this product we come to know about the specification and reputation of it.

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OBJECTIVE This project aims on the market position, performance and reputation of the product Honda Activa I . For that we have taken the feedback of 30 respondents on Honda Activa I. Recently in market there has been boom of advance technology and advance scooters and in that this product is more convenient and has good reputation. In this project we had done analysis of marketing strategy of Honda Activa I.

RESEARCH MEDHODOLOGY .

(A) PRIMARY DATA

Primary data is the first hand information collected from respondance with the help of questionnaire, interviews, and schedules. In this project a structured questionnaire is prepared & data of 30 respondance is collected, tabulated & analyzed on percentage basis.

(B) SECONDARY DATA Secondary data is information collected through publish data, various reference book, journals, magazines, bulletins, weekly & papers published & articles are referred.

DATA ANALYSIS

Q.1) Is Active I your first two wheeler? Criteria Yes No

Respondents 20 10

Percentage 67 33

Respondents

Yes

No

As per the table & the reply from the respondents is clearly indicates that’s 67%of the respondent have bought the product for the first time that means the market strategy of the company is adopting, attractive the customer to buy it at the first time

Q.2) Are you satisfied with Activa I mileage?

Criteria Yes No

Respondents 19 11

Percentage 63% 37%

Respondents

Yes

No

The company’s Activa I mileage is 60kmph,whereas the survey of 30 respondents clears that only 63% are getting a good mileage whereas 37% are not satisfied with it…. may be a reason behind of unsatisfactory that they may not be servicing it properly. The product image regarding mileage is very good in the market.

Q.3) Are you satisfied with after sales services provided by Active I?

Criteria Yes No

Respondents 18 12

Percentage 33 67

Respondents

Yes No

As per the table & reply from the respondents is clearly indicates that’s 60% of the respondent have satisfied with after sales services and 40% is not satisfied.

Q.4) Will you recommend Activa I to anybody? Criteria Yes No

Respondents 23 07

Percentage 77 23

Respondents

Yes

No

As per chart indicate that’s 77% respondent to recommend while the other 23% respondent do not recommend this.

Q.5) which other scooty do you find more flexible than Activa I?

Criteria TATA Wego Activa I

Respondents 16 13 11

Percentage 40 33 28

Respondents

TATA

Wago

Activa I

As per the chart indicate that’s 28% respondent says flexible, and other respondent can voted other scooty. It means more respondent cannot satisfy the product.

Q.6) Is Activa I an affordable scooty? Criteria Yes

Respondents 25

Percentage 83

No

05

17

Respondents

Yes

No

As per the chart indicate that’s 83% respondent is says Activa I as affordable scooty other 17% respondents says not.

Q.7) Which Honda vehicle would u like to purchase? Criteria Active Bike

Respondents 11 12

Percentage 37 40

Car

07

23

Respondents

Activa

Bike

Car

As per the chart indicate that’s 40% respondents purchase bike and 37% purchase Activa . The product service is good in the market.

Q.8) Does the Honda service center helps you out with all your queries regarding scooty? Criteria Yes No

Respondents 20 10

Percentage 67 33

respondents

Yes

No

For the above chart indicate that’s the Honda service center help is 67% respondent satisfied and 33% respondents not satisfied. The Honda service center is improving their service.

Q.9) Do you think Activa I is ecofriendly? Criteria Yes No

Respondents 26 04

Percentage 87 13

Respondents

Yes

No

Above the chart shows that’s 87% respondent think Activa I is an ecofriendly and 13% think that’s not ecofriendly. The most of the respondent can think that’s Activa I is ecofriendly.

Q.10) Are you happy with the sales scheme provided by you? Criteria Yes No

Respondents 24 06

Percentage 87 13

Respondents

Yes

No

As per the chart shows that’s 87% respondent is happy with the sales scheme provided them because most of the customer is attract there product. Its create a good reputation in the market.

SCOPE AND LIMITATION 1. Data collected is limited to only 30 respondents. 2. This study contains 10 questions in data analysis. 3. Respondents have proved that the information collected is sufficient to satisfy the study of marketing strategy.

PROFILE OF HONDA ACTIVA I

 CONCEPT  Marketing Strategy

 The marketing guru Philip Kotler defines the Marketing Concept as: "The marketing concept holds that the key to achieving organizational goals consists in determining the needs and wants of target markets and delivering the desired satisfactions more effectively and efficiently than competitors" This Kotler breaks down into four components; Market Focus, Customer Orientation, Coordinated Marketing and, Profitability.  Some alternative definitions of the Marketing Concept include: "Your business will perform better, if you know what people want in the first place." Anon.  "Marketing is not only much broader than selling; it is not a specialized activity at all. It encompasses the entire business. It is the whole business seen from the point of view of its final result, that is, from the customer's point of view." Druker.

Real-life marketing Real-life marketing primarily revolves around the application of a great deal of common-sense; dealing with a limited number of factors, in an environment of imperfect information and limited resources complicated by uncertainty and tight timescales. Use of classical marketing techniques, in these circumstances, is inevitably partial and uneven. An organization's strategy combines all of its marketing goals into one comprehensive plan. A good marketing strategy should be drawn from market research and focus on the right product mix in order to achieve the maximum profit potential and sustain the business. The marketing strategy is the foundation of a marketing plan.

Principles of Strategic Marketing Know thyself and know thy audience. Most small businesses don't create a marketing plan, often adopting a fly-by-the-seat-of-yourpants mentality or just copying the marketing efforts of a competitor. This can lead to the decision to stop spending marketing dollars when the efforts go flat. There are a few simple questions that a business owner should ask himself to create the basis for strategic marketing for the business.

(A)Who Are You Most small businesses may start because of a great idea yet have no clue as to who they are in the marketplace. Part of your strategy involves defining your business: Create a mission statement, and find your objective, by addressing important, foundational questions. What is the point of your product or service? How does it help consumers or other businesses? What is the goal you are trying to accomplish? Your answers should be succinct and clear.

(B) Create a Marketing Outline Your outline -- which should include your mission statement, objective and your product or service -- serves as a reference for your marketing efforts. It must define your short- and long-term goals because it's important to understand what you are trying to achieve in order to appropriately allocate your resources.

Determine your demographics; understand why consumers would choose you and how you're benefiting them. Finally, do research about the competition and the marketplace to know your positioning. Once you are clear, you can put a marketing budget together.

(C) Where Are Your Customers? Where to market and what tools to use depend on where you find your customers. Get to know your audience. Is this an Internetsavvy group, or are they more likely to respond to a postcard, brochure or some other item in the mail? Is it a short-term or long-term sale? Understanding who you are trying to market to is the key to your marketing strategy. Just throwing mud on a wall to see if it sticks wastes precious resources.

(D) Focus Creates Success Many business owners see the big picture and too often want to serve the whole seven-course meal before their customers have even tried the first course. Your marketing strategy needs to think big but focus small. Market the one thing you do exceptionally well, and focus your budget, your time and where you choose to spend your marketing dollars wisely. When you have a solid return on investment, you also should have a solid understanding of what else your clients need. From there, begin focusing your marketing efforts on the next product or service, and watch your bottom line grow.

Strategic models Marketing participants often employ strategic models and tools to analyze marketing decisions. When beginning a strategic analysis, the 3Cs can be employed to get a broad understanding of the strategic environment. An Ansoff Matrix is also often used to convey an organization's strategic positioning of their marketing mix. The 4Ps can then be utilized to form a marketing plan to pursue a defined strategy. Marketing Mix Modeling is often used to simulate different strategic flexing go the 4Ps. Customer lifetime value models can help simulate long term effects of changing the 4Ps, e.g.; visualize the multi-year impact on acquisition, churn rate, and profitability of changes to pricing. However, 4Ps have been expanded to 7 or 8Ps to address the different nature of services. There are many companies especially those in the Consumer Package Goods (CPG) market that adopt the theory of running their business centered on Consumer, Shopper & Retailer needs. Their Marketing departments spend quality time looking for "Growth Opportunities" in their categories by identifying relevant insights (both mindsets and behaviors) on their target Consumers, Shoppers and retail partners. These Growth Opportunities emerge from changes in market trends, segment dynamics changing and also internal brand or operational business challenges. The Marketing team can then prioritize these Growth Opportunities and begin to develop strategies to exploit the opportunities that could include new or adapted products, services as well as changes to the 7Ps.

 ORGANISATION 

HONDA ACTIVA I

 Honda Motor Co. is a Japanese public multinational corporation primarily known as a manufacturer of automobiles, motorcycles and power equipment.  Honda has been the world's largest motorcycle manufacturer since 1959, as well as the world's largest manufacturer of internal combustion engines measured by volume, producing more than 14 million internal combustion engines each year. Honda became the second-largest Japanese automobile manufacturer in 2001. Honda was the eighth largest automobile manufacturer in the world behind General Motors, Volkswagen Group, Toyota, Hyundai Motor Group, Ford, Nissan, and PSA in 2011.  Honda was the first Japanese automobile manufacturer to release a dedicated luxury brand, Acura, in 1986. Aside from their core automobile and motorcycle businesses, Honda also manufactures garden equipment, marine engines, personal watercraft and power generators, amongst others. Since 1986, Honda has been involved with artificial intelligence/robotics research and released their ASIMO robot in 2000. They have also ventured into aerospace with the establishment of GE Honda Aero Engines in 2004 and the Honda HA-420 Honda Jet, which began production in 2012. Honda has three joint-ventures in China (Honda China, Dongfeng Honda, andGuangqi Honda).  In 2013, Honda invested about 5.7% (US$ 6.8 billion) of its revenues in research and development. Also in 2013, Honda became the first Japanese automaker to be

a net exporter from the United States, exporting 108,705 Honda and Acura models while importing only 88,357

ACTIVA I  Ever since Honda introduced the Active in 2000, it has managed to get a tight noose in the automatic scooter segment. And although it continues to dominate the market, over time a lot more avenues have opened up for manufacturers to exploit. This class of two wheelers is no longer simply categorised by engine and efficiency but by form and function as well. While there are young and stunning offerings out there like the Honda Dio and the Suzuki Swish, the other end of the spectrum comprises scooters like the Activa and the Mahindra Duro DZ which appeal to a more mature audience.  Despite the big H pitching the Activa i as a unisex scooter, it is smaller and sleeker than the Activa making it a better fit for the fairer sex. The slim front fascia with the clear lens turn indicators and the leaning headlight make the scooter appear fresh. The arc shaped side panels that blend well into the tail lights host the Activa i badge. Even though the dimensions are similar to the Activa, the younger offering is much lighter thanks to its fibre body panels. It is also marginally longer (30mm) than the Activa, but still the floorboard is big enough to rest just the foot, leave aside the front storage box that’s available as an option on the Activa. The seat, however, is long enough to seat two comfortably.  Like all scooters, this too has a basic instrument cluster with an analogue speedo and a fuel gauge. Switch gear is par for the course while the handle bars are well positioned for a good riding posture. Under the seat, the Activa I has 18 liters of storage space. The new offering also comes with a tyre hugger for the rear wheel.

The overall look and feel is good but it could have done wonders with better quality plastics.  Underneath the skin the Activa I host the same engine as on the new Activa – a 109.2cc four-stroke air-cooled mill with the patented Honda Eco Technology. Needless to say the power output also remains the same at 8.1PS @ 7,500 rpm and 8.74Nm @ 5,500rpm. Mated to a V-matic transmission, the Activa I has good low and mid-range boost which makes it a breeze to ride in the city. In our tests it touched the 60km/h mark from standstill in a respectable 8.43seconds which is a tad faster than the Activa and also recorded a top speed of 88.28km/h.  The 130mm dia drum brakes up front and the Combi brakes of the same size at the back, work well in bringing the scooter to a halt from 60km/h in just 17.25metres. Of course, this has also got a lot to do with the 90/100 10-inch MRF Zapper tubeless tyres at the front as well as the rear, which ensure that the rider feels confident even under heavy braking. In terms of performance, the Activa I meets all expectations from a scooter from the Honda stable and, more importantly, the Activa family.  Honda has made all the right moves with the launch of the Activa I, especially taking into consideration the fact that it is priced at Rs 44,200 (ex-showroom Delhi) which is almost Rs 3,000 cheaper than the Activa. No doubt that in a price sensitive market like ours, the difference in cost definitely has an equivalent effect in the buying decision. The Japanese two-wheeler manufacturer has also played a very smart and safe strategy by capitalizing on the already established Activa brand.

There was a time when people talked only of Bajaj scooters. Then, there came Kinetic Honda to give a tough competition to Bajaj. Kinetic gave Indians the gearless, strong and sturdy scooter. The time changed and it is now the turn of

Honda Motors and Scooters India Limited, to gain popularity in this segment. Three gearless 110 cc engine scooters of Honda HMSI are already popular in the market. These models of Honda scooters are popular with the names Dio, Activa and Aviator. They are priced between Rs. 44,718 and Rs. 53,547 (Ex-showroom Delhi). Another name can now be added to this trio, since Honda Motors and Scooters India Limited has launched the new Honda Activa i on June 12, 2013. Priced at Rs. 44,200 (ex-showroom Delhi), this will be the most affordable and competitive model in this segment of scooters. The new model will be available for sale throughout the country by June end. The Honda Motors has strategically categorized this scooter as a personal compact scooter. The President and CEO of Honda Motors and Scooters (HMSI) Limited, Keita Muramatsu hinted at the company's strategy in the following words commenting on the launch of the scooter: "As a leader in the automatic scooters segment, Honda's entry into the personal compact segment with ACTIVA-I is its next strategic step towards reinforcing its market leadership." According to the CEO of HMSI, the company is now engaged in the development of a new two wheeler, which will be a hundred percent indigenous product. However, it was not disclosed whether the new product will be a motorcycle or a scooter. The new product is likely to be completed within a year. Honda has already captured 50 per cent of the scooter market in India. The company now aims to be the largest two-wheelers manufacturer in India by 2015. Let us now discuss the features and specifications of Honda Activa I.

Engine and performance of the new Honda Activa I Honda Motors and Scooters India Limited did not make changes in the engine of the new model. It has used the same 109.2cc 4-stroke air cooled engine by which its earlier version Honda Activa has been powered. This engine produces power of 8.15 PS @ 7,500 rpm. The torque is of 8.74 Nm @ 5,500 rpm. The best thing to talk about its performance is the new Combi Brake System (CBS). This has greatly reduced the braking distance by 24%, as compared to the traditional braking system. The scooters mainly suffer from their low fuel economy. However, Honda Activa I is a marvelous scooter in the matter of fuel economy giving the user a mileage of 60 kmpl. This is a great change brought in the scooters by the use of Honda Eco Technology (HET).

 Tubeless tyres, viscous

air filter and maintenance free battery Another great feature of Honda Activa I is its tubeless tyres. The viscous air filter and the maintenance free battery give the rider of this wonderful vehicle a pleasurable riding experience.

 Storage space, fuel tank, ground clearance and ergonomic grab rail There is quite a large storage space of 18 liters, which is conveniently located under the seat. The fuel tank capacity is 5.3 litres. Fill and forget strategy of Honda can be applied here. You can have a tension free ride for hundreds of kilometres by just

filling the tank once. There is a good clearance of 165 mm from the ground. This, in fact, is 12 mm more than what is provided in the former versions of Honda Activa. The women riders will feel the new scooter very convenient to use, when they have to put the scooter on its main stand. The new Honda takes 15 percent less force to be used when putting it on the main stand, thanks to its ergonomic grab rail.

 Appearance and style The new indicators and the new tail lamp gives very good appearance to your new Honda Activa I. The new scooter has slim and sleek design, which is one of the best among the scooters available in the industry. The company has lifted the superb design from its already existence Honda Aviator.

 Signal to a price war among 110 cc scooters

Honda Activa I have given a green signal to ensuing price war among scooters with 110 cc engine. This will benefit the buyers of scooters in this segment. The new Honda is priced lower than the earlier 110 cc engine scooters like Honda Activa and Honda Dio. Honda Activa i have been given a lower price tag than TVS Wego110. This is certainly going to increase rivalry in the scooters manufacturers as far as the price of the scooters in this segment is concerned.

 Price, availability and colours Honda Activa I am likely to put for sales throughout the country by this month end. The basic price of the scooter is kept at Rs. 44,200 (ex-showroom Delhi). Like its predecessor Honda Activa, the new Honda Activa I am surely to be one of the best selling scooters in the market. The company has already established a new factory near Bangalore for the assembly of this scooter and there is no likelihood of delay in the delivery of this scooter. The new scooter will be available in Beige, White, Red and Silver colours.

FINDINGS AND SUGGESTIONS Findings 1. Major of the customers of Honda Activa I are belongs to age group above 40 years (40%) 2. 31% of the customers have opined that product performance is good 3. 33% of the respondents have a poor opinion about the after sales service

Suggestions 1. Only 10% of respondents have an excellent opinion about product quality. So quality of the scooter should improved 2. 40% of the respondents have a poor opinion about companies after sales service. So after sales service should be improved.

Conclusions From this project we can conclude that customers are overall satisfied with Honda active I. On an average more than 83% people feel that the prices are affordable whereas 17% do not agree.