Royal Enfield
Short Description
project on marketing...
Description
A PROJECT ON Royal Enfield
Submitted to T.GHOSAL
kumar CUJ/I/2012/MBA/O3 VI SEMESTER
Submitted by :-
Abhishek
Ackn!"e#$emen%
The Submission of this Project Report gives us an opportunity to convey our gratitude to our Marketing Faculty Mr T.G!S"# for being our mentor and guide.
$e e%press our deepest thanks to him for providing us the guidelines to make the project that helped us in better understanding of R!&"# '(F)'#* and its +orking.
&r'ec% Ob'ec%i(e
, ) To kno+ about the R!&"# '(F)'#* -.Market analysis/ompetition0/ustomer analysis0Market potential1 of R!&"# '(F)'#* 2.3ey gro+th drivers of R!&"# '(F)'#* 4.Segmentation0Positioning of R!&"# '(F)'#* 5.Strategic 6randing by R!&"# '(F)'#* 7.Product market analysis of R!&"# '(F)'#* 8.Marketing Strategies+.r.t to the element of marketing mi%1
In%r#uc%in In#ian au%mbi"e in#us%r* The automobile industry in India is the ninth largest in the world with an annual production
of oer !"# million units in !$$%" In !$$&' India emerged as Asia(s fourth largest e)porter of automobiles' behind Japan' *outh +orea and Thailand" India,s automobile sector consists of the passenger cars and utility ehicles' commercial ehicle' two wheelers and tractors segment" The total mar-et si.e of the auto sector in India is appro)imately Rs /0$ billion and has been growing at around % percent per annum for the last few years" *ince the last four to fie years' the two wheelers segment has drien the oerall olume growth on account of the spurt in the sales of motorcycles" 1oweer' lately the passenger cars and commercial ehicles segment has also seen a good growth due to high discounts' lower financing rates and a pic-up in industrial actiity respectiely" 2a3or automobile manufacturers in India include 2aruti 4dyog 5td"' 6eneral 2otors India' 7ord India 5td"' Eicher 2otors' 8a3a3 Auto' 9aewoo 2otors India' 1ero 1onda 2otors' 1industan 2otors' 1yundai 2otor India 5td"' Royal Enfield 2otors' T:* 2otors and *wara3 2a.da 5td" ;ith the economy growing at &< per annum and increasing purchasing power there has been a continuous increase in demand for automobiles" This' along with being the second largest populated country' ma-es the automobile industry in India a ery promising one" In#ian %! !hee"er marke% Eer since the old 5ambretta scooter was replaced with the flurry of ibrant two wheeler
models' Indian two wheeler industry has seen a phenomenal change in the way they perceie the Indian mar-et" Two wheeler manufacturers are now competing in an eer growing consumer mar-et by bringing out new products and features" The country has now grown into the second largest producer of two wheelers in the world" Currently there are around =$ two> wheeler manufacturers in the country' and they are 8a3a3' 1ero' 1ero 1onda' 1onda' 2ahindra?+inetic' Royal Enfield' *u.u-i' T:*' and @amaha" There hae been arious reasons behind this growth" 8ecause of poor public transport system' the citi.ens found conenience in two wheelers" Added to this is the fact that the aerage Indian still does not hae the purchasing capacity for a more e)pensie' four wheeler"
The story of 2r" Ratan Tata inspired by a family of four members traelling in Indian roads' not concerned about safety and the eolution of the idea of TATA Nano has been uite famous globally" The Indian two wheeler industry can be diided into motorcycles' scooters and mopeds" The consumer has changed his preference from mopeds to scooters and then to motorcycles" The trends seen in the past few years include females increasingly using two>wheelers for their personal commutation and arious two wheeler manufacturers designing ehicles specially to cater to needs of this segment" One of the earliest reolutions in this industry was +inetic,s introduction of the concept of electronic?self>start and automatic gears which made two wheelers comfortable and useable by women' when compared to old 8a3a3 Cheta- adertisements which showed middle aged females riding a 8a3a3 Cheta- scooter" A recent trend in the industry has been electric ehicles' which mostly leerage on their eco> friendliness and low operating costs' but is still not accepted well due to the lac- of reputation of the manufacturers and lac- of trust on technology' which is still being perceied in the nascent stages' especially battery and inerters which proe to be ery e)pensie components" T:* recently leeraged this opportunity by launching a hybrid model of their non geared scooter B T:* *cooty" The end of the last decade saw 8a3a3 ta-ing a radical decision to do away with the *cooter range and completely concentrate on motorcycles' especially stating change in customers preference as the main reason" The customers are left without a choice in most cases than to migrate from the traditional scooters of the Indian family to the all youthful bi-es that one,s son rides to college" ;ith rising incomes and purchasing capacity of the aerage Indian' the demand for two wheelers in the power segment has increased considerably" There also hae been constant signs of maturing of the mar-et when the manufacturers reacted by coming up with innoations' catching attention of potential buyers and sometimes creating a new class of customers or altering the preferences and attitudes of e)isting consumers
&r+"e , %he Or$ani-a%in
Royal Enfield are the ma-ers of the famous 8ullet brand in India" Established in =&//' Royal Enfield IndiaD is among the oldest bi-e companies" It stems from the 8ritish manufacturer' Royal Enfield at Redditch" Royal Enfield has its headuarters at Chennai in India" 8ullet bi-es are famous for their power' stability and rugged loo-s" It started in India for the Indian Army #/$cc bi-es were imported in -its from the 4+ and assembled in Chennai" After a few years' on the insistence of Pandit Jawaharlal Nehru' the company started producing the bi-es in India and added the /$$cc 8ullet to its line" ;ithin no time' 8ullet became popular in India" 8ullet became -nown for sheer power' matchless stability' and rugged loo-s" It loo-ed tailor>made for Indian roads" 2otorcyclists in the country dreamt to drie it" It was particularly a faorite of the Army and Police personnel"
In =&&$' Royal Enfield entured into collaboration with the Eicher 6roup' a leading automotie group in India' in =&&$' and merged with it in =&&0" Apart from bi-es' Eicher 6roup is inoled in the production and sales of Tractors' Commercial :ehicles' and Automotie 6ears" Royal Enfield made continuously incorporating new technology and systems in its bi-es" In =&&' when the 6oernment of India imposed stringent norms for emission' Royal Enfield was the first motorcycle manufacturer to comply" It was among the few companies in India to obtain the ;:TA ;hole :ehicle Type ApproalD for meeting the European Community norms" Today' Royal Enfield is considered the oldest motorcycle model in the world still in production and 8ullet is the longest production run model"
&r+"e , %he &r#uc%s Royal Enfield Bullet 350
One can be a part of classical prominence by haing a ride on Royal Enfield 8ullet #/$' a macho bi-e which is stylish as well" The brawny is laden with plenty of attention grabbing features li-e traditional designing' astonishing power of =% bhp from air cooled' 0 stro-e engine' large wheels' and better sitting for superior riding" This has been the classical offering from Royal Enfield and the engineering and the design has remained unchanged oer the years" It has remained the flagship product with the other products being perceied more as deriaties of this motorcycle rather than standalone products" Royal Enfield Bullet 500 (a!t "#on$
Royal Enfield 8ullet /$$ is a classic bi-e haing intage styling" The bi-e has hand>painted pin stripes' a 0>speed transmission' double leading shoe front bra-e and was touted as the powerhouse model with a whopping !F bhp output" ;hile the bi-e loo-ed mostly similar to the *tandard #/$cc offering' its bigger engine made it a more potent ehicle to hae on long rides" Royal Enfield Bullet Ele%t#a &S
Royal Enfield motorcycles were renowned for haing problems starting because of their C8 Point Ignition systems" In an attempt to brea- this negatie image' the company came up with Electra" Electra was in effect a *tandard #/$cc but had a C9I Ignition system" This paed the way for the newer bi-es from Royal Enfield which now hae 9igital TCI as a a part of the standard pac-age"
Royal Enfield Li'tnin' 535
5oo-ing for an image ma-eoer bac- in !$$=' Enfield came up with 5ightning" It was a 5imited Edition /#/cc motorcycle" The single> cylinder' air>cooled /#/cc engine was the largest *CAC engine for any motorcycle in the world" The bi-e receied limited acceptance amongst users and was discontinued after !$$ but it succeeded in rebuilding the power>bi-e image of Royal Enfield amongst the enthusiasts" Royal Enfield Bullet Ele%t#a 5S
;ith Electra 0* receiing uite a lot of acceptance' Royal Enfield decided to add a few more features to align themseles with the more contemporary manufacturers" 7rom a right>hand side 0>speed gear shift' they moed to a left>hand side />speed gear shift" 9isc bra-es also made an entry' with the !%$mm disc being the largest in the country" This has been one of the most successful models from Royal Enfield and was to a large e)tent responsible for the reial of the brand during the turn of the millennium" Royal Enfield Bullet )a%i!mo
2achismo is Royal Enfield,s Gchrome monsterH" Resplendent with chrome' they are aailable in both #/$cc and /$$cc ariants" They were the first bi-es to hae the now legendary 5ean 8urn A:5 Engines" These were the result of Royal Enfield,s collaboration with an Austrian Engine manufacturer' A:5"
Royal Enfield Tunde#bi#d Bi*e
Royal Enfield Thunderbird is a powerful bi-e which for the first time bro-e off from the 8ullet, loo-" They were modeled similar to the cruisers aailable worldwide and were positioned as a tourer,s choice" It has deeloped into a strong maruee itself and continues to remain a brand name despite engineering changes that went into it" It started as a #/$cc A:5
*ingle>*par-
Engine"
Today
the
Thunderbird Twinspar- is a #/$cc 4nit Construction Twin>spar- Engine with about !$ bhp output" Royal Enfield la!!i%
In !$$%' Royal Enfield uneiled its latest offerings B the Classic #/$ and the Classic /$$"*tyled in the intage /$,s loo-' they came
with
=%
inch
tyres'
4nit
Construction engines and the loo- and feel of a intage" Priced at ="# la-hs and
="F
la-hs respectiely' the #/$cc and the /$$cc ariants
are slowly
gaining
popularity amongst users for the lower ride height' the greater power and aboe
all'
the intage feel of the bi-e"
Ra%ina"e ,r %he &r'ec% Royal Enfield motorcycles hae for a long time held the fancy of Indian two>wheeler users"
1oweer' this awe and enthusiasm has not really translated into sales for the company" On a superficial leel' it seems that this may be caused by high prices' low fuel>efficiency' and maintenance issues" 1oweer' it was felt that this can be caused by a strong disconnect between the perception of the motorcycles from Royal Enfield amongst the users and the alue proposition from the company"
.e+ni%in , Cns%ruc%s In the initial brain storming sessions' arious parameters were considered important to a
rider,s choice of 8ullet as a ehicle and the arious prime moers behind these parameters were discussed" These parameters were broadly classified as aD Internal parameters Ones that stems from the user,s notions and internal aluesD bD E)ternal parameters Ones that depend on 2ar-eting Communication and others, perception of the userD ;hile most riders seemed to be influenced by both' the Ego>9efensie riders display a greater tendency to be influenced by the e)ternal parameters" They loo- for the macho image of the 8ullet to rub off on them" The :alue>E)pressie users loo- for the sense of freedom in the bi-e and the long rides that come with it" In%erna" &arame%ers Cus%mers In%erna" cus , Cn%r"
Considering that Power 8i-es are e)pensie' arious features need to be compared' and they are e)pected to be used for a considerable period of time' purchase of bi-es come under comple) consumer behaior decisions" The consumer behaior under such cases can be defined in 0 steps namely =" +eed A#ou!al , #oblem Re%o'nition B In this stage' the customer recogni.es the need for a bi-e based on his current situation" *tudy of this phase helps us identify the arious needs of customers' which needs they prioriti.e' ability to satisfy needs' how they satisfy their needs etc" !" Sea#% fo# "nfo#mation B Once the customer identifies his need for a product' he searches for information related to the product before purchase" A study about this phase can eole insights into which medium to use to reach the customer' what communication mediums to use' influencers' etc" #" B#and ealuation / u#%a!e B As a result of information search' the customers ealuate brands aailable based on their past and current information with their desired benefits" It is ery important to be in the consideration list in this stage for a brand to be consumed" A
company needs to identify if it is in the consumer,s consideration list and if not what are the reasons for this" 0" o!t u#%a!e Ealuation B This may be associated to satisfaction while consumption?usage through parameters li-e performance' after sales support etc" Another important aspect at this stage is post purchase dissonance etc" This stage is ery important to deelop loyalty among customers and for popularity of the brand in terms of performance reiews"
E%erna" &arame%ers Inuncers4 Marke%in$ an# Cm5an*
*ome customers e)hibit choices based on how they wish to be perceied' a feeling that often stems from an internal insecurity that needs an e)ternal coer>up" These users are heaily influenced by 2ar-eting communication showing the bi-e catering to their Ego needs and also by the general peer ealuation of the image the bi-e pro3ects" These users migrate more towards the loo- and the image of a ehicle rather than its performance or its fit with their actual riding reuirements" 2ost of such users find a bi-e li-e 8ullet unfit for them as they feel the bi-e is either too costly or they are not strong enough to handle a 8ullet"
2ar-et analysis )a#*et otential
Royal Enfield(s )AR1ET"+G initiatie to woo potential customers through its K5og OutL campaign targeted at corporates is paying diidends" The Chennai>based manufacturer of 8ullet motorcycles and an Eicher 2otors unit aims to pitch the riding e)perience as a team>building e)ercise oer wee-ends" And the company reports that haing ridden an Enfield' many a corporate rider has sold off his e)isting two>wheeler and
upgraded
to
an
Enfield
bi-e"
According to +oshy' the company has been recording consistent growth for the past three years" L;e hae been growing =/ to =% percent eery year" 5ast year when the industry was down =! percent' we were up =% percent
In a competitie mar-etplace' it ta-es out of>the>bo) thin-ing to attract buyers and drie sales" 4sing its innoatie mar-eting campaigns' Royal Enfield seems to hae hit the right note for its range of thumpers"
u!tome# analy!i!
8y and large it was found that most of the customers are choosing Royal Enfield ehicles because of its :ehicle Appearance' pic-up' good models and engine appearance etc"
Its gie a pride to the customers by owning it"
Its boldness and a felling of riding on a bullet"
ometition
1arley daidson
Triumph
1yosung 9*+
+T2
1ey G#o2t #ie#!
It,s a bi-e for Indian Roads' Een if there is no roadM
The brand simplicity and its engaging uality "
The brand has a strong presence and resonance"
Only Print Ads appear online or in selected lifestyle and trael maga.ines"
2ar-eting 2i) #odu%t
CA7 RACER CONTINENTA5 6T CR4I*ER T14N9ER8IR9 /$$ T14N9ER8IR9 #/$ RETRO *TREET C5A**IC 9E*ERT *TOR2 C5A**IC 8ATT5E 6REEN C5A**IC C1RO2E *TAN9AR9 *TREET 8455ET /$$ 8455ET E5ECTRA 8455ET #/$
#i%e
Its price range between ="# la-h> ="%/ la-h"
la%e
=%$ dealers == 8rand stores =$$ Authori.ed serice centre E)port to 0! countries 0$ importers and #$$ dealers"
#omotion
The TRIP, Campaign" The 5eae 1ome, Campaign" Promotions are done through Riders Community and 2oies" The Company -eeps on Organi.ing a lot of riding eents' People hae there own community symbols and flag also"
Se'mentation 6eographic 2ainly the urban youth 9emographic Age group of !!>/$ years Age group of !!>/$ years" 6ender male 4pper and middle income group who want a bi-e that is stylish and powerful" Psychographic *EC A= A! Classic' royal and legendry lifestyle
o!itionin' Position itself in the mind of consumers creating an image which is full of royalty and legendary image"
*wot analysis St#en't
*i.e and scale of parent company 4sed on a large scale for military purposes because of its *T4R9INE**"
Established brand name in the cruiser mar-et" Established mar-et distribution channel" 4ea*ne!!
;eight of the motor cycle can be an issue for few customers" 2ileage of high cc bi-es is an issue" Oo#tunitie!
Two>wheeler segment is one of the most growing industries 2ore brand isibility T#eat!
*trong competition from Indian as well as International brand" 9ependence on goernment policies and rising fuel prices"
St#ate'i% b#andin' Celebrities now a days promoting Royal enfields bi-e Jab ta- hai 3aan' harry potter' .indagi na milegi dubara' E- illain" 1andcrafted in chennai" The company doesn,t use the T: Commercials and the regular channels for brand building"
u!tome# analy!i! 8y and large it was found that most of the customers are choosing Royal Enfield ehicles because of its :ehicle Appearance' pic-up' good models and engine appearance etc"
Its gie a pride to the customers by owning it" Its boldness and a felling of riding on a bullet" 8enefits and ery much muscular 4sage rate heay and rough use" Attitude enthusiastic and -ingly"
It,s a 1eritage brand" No promotion on technological aspects"
Royal Enfield sold 3ust oer #$$'$$$ units in !$=0 to 1arley>9aidson,s !F'&&&" To be sure' the American motorcycles are more e)pensie the cheapest is twice the price of a top>end Royal EnfieldD and popular brands of other motorcycles sell in staggering numbers in populous India" 8ut then again' as recently as in !$=#' 1arley>9aidson dominated sales selling =$$'$$$ more motorcycles than Royal Enfield"
Cnc"usin an# Recmmen#a%ins The following are the Conclusions from the 9ata Analysis =" The buying behaior is goerned predominantly by the need for Power and respect for the iconic 8rand" !" The internal locus of control is by and large dependent on the *ense of Control the motorcycle offers and also on the *ense of 7reedom that users associate with it" #" 4sers are mostly Professional 2ales' !$>#/ years of age' including some students" 0" 4sers, display mostly :alue>E)pressie behaior and Ego>defensie behaior is not seen amongst responses" /" People who choose not to buy 8ullets do so because of high price' maintenance and spares hassles and also because some feel they are not built for it" " Adertisements are rarely recalled and are highly ineffectie amongst non>8ullet riders" 8. 8ullets are perceied as low on cost>effectieness' but high on ride comfort and reliability"
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