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Submitted by: 1. 2. 3. 4. 5. 6. Divye Sood(14) Henry Rawal(15) Ishan Singh(17) Jagat Chokshi(20) Kritika Goyal(22) Shilpa Jain(45)
TABLE OF CONTENTS
Page Nos. 1. Executive Summary 2. Current Marketing Situations 3. Objectives, Opportunities and Issue Analysis 4. Marketing Strategies : I. STP II. Product Mix III. Advertising Strategies 5. Action Program :Expansion Plan 6. Facts and Figures: Profit or loss 1 2-5 6-7
8 9 10-11 12 13
7. Bibliography
14
EXECUTIVE SUMMARY
Bajaj Auto came into existence on November 29, 1945 as M/s Bachraj Trading Corporation Private Limited. It started off by selling imported two- and three-wheelers in India. In 1959, it obtained license from the Government of India to manufacture two- and three-wheelers and it went public in
1960
Bajaj Auto is a major Indian automobile manufacturer. It is India's largest and the world's 4th largest two- and three-wheeler maker. It is based in Pune, Maharashtra, with plants in Waluj near Aurangabad, Akurdi and Chakan, near Pune. Bajaj Auto makes and exports motor scooters,
A year back, Bajaj introduced DTSi technology upgrading its always successful PULSAR 150cc and 180cc. Though Bajaj had changed its identity it still dominates for its creativity in ads.
Pulsar has been the best selling price in its segment since its launched. Bajaj has been continuously able to position pulsar very effectively targeting it in the market has the youth sports bike
Bajaj also introduced the concept of pro-biking to market Pulsar. Pulsar has been are feature laden from the very start. It was the first Indian bike to come with innovations like the alloy wheels, digital speedometer, and DTS-i and exhaustec technologies. Bajaj even holds patents for the DTS-i and exhaustec
Bajaj targeted the 18-24 with Pulsar but later found that the brand appealed to a much older audience. This helped Bajaj to change its target audience to 21-35 years. Unlike its old ways of doing things, Bajaj did not rest with the laurels. It knew that Pulsar is the golden key to control the entire bike market. Hence Pulsar got undivided attention from the company.
After ruling the premium bike segment, Bajaj is taking their brand to another level. Bajaj recently launched Bajaj Pulsar 200 DTS-i to take on the competition from Hero Honda and the like. The new Pulsar boasts of spruced up engine, new digital console and new style. Pulsar is definitely getting better. Pulsar 200 is being launched with a new campaign revolving round the concept of Free Biking.
In FY 2010,company domestically sold over 5,59,000 bikes in their sports category, this has grown by 42% to almost 7,96,000 units in FY 2011-of which Pulsars alone accounted for over 7,71,000 units.
Through Pulsar, Bajaj auto has successfully transited from the low profit commuter STD segment in favor of a better brand position and higher profit segment-sports.
In addition to products, branding and the back end, the company has significantly strengthened its dealer network. In FY 2011, Bajaj Auto increased its dealership by 159 to raise the total number of dealers to 589, all in favor of Pulsar.
South East Asia was another bright spot. The Companys subsidiary in Indonesia, PT BAI, grew volumes by 81% with sales of 21,586 units, largely the Pulsar range.
Bajaj auto has shown phenomenal growth, owing to Pulsar, the growth has been witnessed every year (barring the years of recession). The table below shows the growth in sales from 2004 to 2010.
Sales-Time
9 8 7 6 sales(million) 5 4 3 2 1 0 2002
INTRODUCTION
GROWTH
2003
2004
2005
2006
2007
2008
2009
2010
2011
The product life cycle curve of the Bajaj Pulsar has passed the stage of introduction between years 2003 to 2007,wherein it saw maximum sales(refer to the above table). Though the year 2008-09 saw a fall in sales, owing to recession, the He-Bike bounced back in late 2009 and registered sales worth 31.4 % in year 2010, especially with the 200 and 220 cc variants.
Summary of Product Life Cycle Characteristics Characteristics Sales Costs Profits(PAT) Competitors Introduction Low- 9% Rs. 49,966 crores (FY 2004) Rs 7,668 (FY 2004) Growth(FY 2011) Rapidly rising- 18% Rs.13,224 crores (FY2011) Rs3,340 crores (FY2011) and
Honda Unicorn and TVS Honda Karizma Victor. Apache, CBZ, FZ.
SWOT:
STRENGTHS Fuel efficient light sports name Delivers a light feel Well priced Huge variety of colors Limited speed Economically priced Huge export market (esp. Asia) Comfortable riding as compared to competitors TVS Victor No prominent Brand ambassador Weak advertising.
WEAKNESSES OPPORTUNITIES
THREATS
SWOT:
STRENGTHS Good performance and handling Power Packed Machine Sporty look
WEAKNESSES
OPPORTUNITIES
THREATS
Better ride quality Newly discovered DTS-I engine Strong and highlighted advertising Huge variety of colors Poor economy Heavy added 4 more kgs Pulled down the kmpl figure Huge export market (esp. Asia) Comfortable riding as compared to competitors Added features without increment in price Hero Honda Apache No prominent Brand ambassador
PULSAR 220 CC DTS-i Objectives: Pulsar 220 is the high end Bike in whole Pulsar family and promoting it is
very difficult because we need to differentiate it from other pulsar bike and whole Bajaj family like what Hero Honda did in case of Karizma ZMR. To differentiate Pulsar 220 from its Pulsar family To increase the customer base with choices like speed, safety, luxury. Fuel efficient The Street Fighter Well priced Powerfully driven Advertisements Huge variety of colors Lacks Long term comfort ability Lacks Comfortable riding as compared to competitors Front seats have limited stuffing Not for long distance rides. Priced below Karizma Huge export market (esp. Asia) MTV Stunt Mania
STRENGTHS
WEAKNESSES
OPPORTUNITIES
THREATS
MAJOR SEGMENTATION VARIABLES FOR BAJAJ PULSAR Geographic Rural and Urban Segment: Targeted towards urban youth1. Demographic Age : targeted towards youth Gender: Got a macho look and is definitely for male3. Income: Positioned in the premium segment of bikes. It is targeted to the higher and upper middle class of society. Psychographic Lifestyle: Fastest bike in India, it is targeted towards the people who love speed and adventure. Personality: - Bajaj has teamed with Fast with Furious (movie) for promotion and MTV Stunt Mania. This clearly shows that Pulsar is targeted to aggressive people, banking on its The fastest Indian tag.7 Behavioral Benefits: Leader among the performance bikes. It has got features which no other bike provides in India User Status: Pulsar has created a big hype among Indian youth. There are a lot of people who are willing to buy the product Readiness Stage: This bike has got lot of attention among Indian youth10. Attitude toward Product: Very popular among bike enthusiasts
DIFFERENTIATION STRATEGIES:
Product Differentiation: 1) Form: a) Color: Plasma Blue, Cocktail Wine, Red Midnight, Black Misty, Grey Silver b) Pulsar 150cc, Pulsar 180cc, Pulsar 200cc and Pulsar 220cc with and without Fuel injection. 2) Design: a) Digital odometer, Digital speedometer, Digital fuel gauge and two digital trip meters b) First bike in India with 33 mm front fork for better shock absorbing facility. c) Split seat for better riding and sitting comfort.
d) New petrol tank flaps give petrol tank an aerodynamic looks. 3) Features: a) All Black styling b) 3D chiselled logo c) Vertical stack twin projector headlamps d) Auto choke e) Clip-on handle bar f) Split seats g) Digital Twin Spark Ignition h) Engine oil cooler i) Fuel and battery charge indicators 4) Durability: The muscular aerodynamic shape of Pulsar DTS-i and its 1350 mm of wheel base with 17" large alloy wheels give this Bajaj bike a robust presence on the road. 5) Performance quality: a) Digital Twin spark Ignition (DTS-i) technology provides efficient fuel combustion and better performance. b) Larger resonator and catalytic convertor improves the performance. c) Largest venturi carburetor provides high performance. d) Exhaust technology improves scavenging process and hence the performance of the vehicle. 6)Service differentiation: a) 2 years /10,000 km warranty. b) Bajaj Finance for finance support 7) Channel differentiation: Exclusive Pro- biking showrooms16. 8) Personal differentiation: Customer Care (Toll free number)17. 9) Image differentiation: Change in logo
PRODUCT LINE STRATEGY : Line stretching : Bajaj launched Pulsar 150 and Pulsar 180 models in the year of 2001, and subsequently they introduced DTSi (Digital Twin Spark Ignition) models of both earlier models, Pulsar 150 DTS-I and Pulsar 180 DTS-i. By 2007 they introduced Pulsar 200 DTS-I model (which was drawn back by Oct 2008). Thereafter, they introduced Pulsar 220 DTS-Fi and Pulsar DTS-i models.
Sensing the room in 180 cc and 200 cc range, for new entrant and growing interest of youth, Bajaj Auto introduced these new variants, i.e. Pulsar 200 DTS-i and Pulsar 220 DTS-i. This shows Up-Stretching of the existing product line. Line filling :When Bajaj Auto introduced Pulsar 150, there was no other automobile company in Indian market that was offering any bike of more than 150 cc engine capacity, except Royal Enfield thatwas of 225 cc. So, subsequently introduction of Pulsar 180, Pulsar 180 DTS-I were the efforts ofthe company towards filling the gap in the Product Line between the 150 cc engine bikes and225 cc engine bikes. Line Modernization, Featuring and Pruning : Line Modernization : 1. Bajaj Auto Introduced Pulsar 150 and Pulsar 180 models in 2001. 2. Bajaj (JV with Tokyo R & D25) devised Digital Twin Spark ignition (DTS-i) Technology by 2002 and introduced this in their then existing variants of Pulsar 150 and Pulsar 180 3. This technology improved engine power by 1 bhp (Brake Horse Power). 4. The 2005 series of the Pulsar featured 17" alloy wheels, lower stance, 15 litre fuel tank capacity and Nitrox filled gas shock absorbers. 5. The 2006 series included key changes in the looks and styling, which includes a range of features like self-cancelling turn indicator switch, flush LCD screen with digital read out of important vehicular data, pilot lamps, new design turn indicators, new LED tail light assembly, better engine torque, reduced engine and body vibrations, and improved gear shift Line featuring : Advertisement of Bajaj Pulsar: Bajaj always features their latest Pulsar Model exhaustively and put lesser efforts on the other Pulsar variants and other bikes29. This is the case of Line Featuring. Line Pruning : 1. Bajaj Auto withdrew their model Pulsar 200 DTS-i within a very short span of its launch.
PRODUCT MIX PRICING STRATEGIES:Product line pricing: Bajaj has four variants under its product line of Bajaj Pulsar, as follows:
PULSAR MODEL Bajaj Pulsar 150 ES DTS-i UG Bajaj Pulsar 180 DTS-i UG Bajaj Pulsar 220 DTS-i
Optional feature pricing: The Bajaj Pulsar DTSi-220 does not have any optional feature in it. It comes in four colors having same price33. Captive pricing: In a Bajaj Pulsar bike if any part(s) (certain special parts like engines, piston, silencer, accessories, fuel injector, etc.) is not functioning properly, due to any reason(s), customer requires to buy that particular part from the parent company only35. Two part pricing: There is no two-part pricing. By product pricing: It has no by-product pricing. Product bundling: Company offers no product bundling for Pulsar brand.
ADVERTISING STRATEGIES:
Campaign: Pulsar & Stunting - Creating Indias bestselling sports bike Agency: Ogilvy & Mather Mumbai Client: Bajaj Auto Brand: Pulsar Objectives: Indias home-grown Bajaj Pulsar sports motorcycle was in 2004 facing serious competition from Japans Honda, which controlled 60 percent of the market, and Yamaha, both of which were ramping up their presences with new sports bikes. The Japanese brands had superior racing credentials and Honda by the end of 2004 claimed 30 percent of the performance segment, which until then was dominated by Pulsar. The Indian brand set two big goals to combat the competition: grow faster than the Japanese by outselling Honda and Yamaha combined annually; and make Pulsar a US$1 billion brand by 2010.
Strategy: Realizing the brand had a technology disadvantage against Honda and Yamaha, and that those brands were synonymous with racing, Pulsar decided to create a measure for performance that was beyond racing and that connoted performance. By focusing on its uniquely strong attribute of handling, Pulsar turned to bike stunting to prove the bikes taut handling, quick throttle response, rugged build, and maneuverability. Through its advertising from 2005 to 2010, the brand used stunting to show its superiority over its Japanese competitors, including a famous 2008 TVC that featured a ballet of bikes. In 2009, Pulsar created Pulsar MTV Stunt Mania, Indias first bike stunt reality show, which ultimately replaced conventional advertising in Bajaj Autos marketing plan. In 2011, Pulsar became the official sponsor of Indias first professional stunt riding team, Ghost Ryderz. Results: Despite facing nine brands between Honda and Yamaha, Pulsar managed to outsell its Japanese competitors combined. Over five years, sales increased seven fold. In 2010, Pulsar became a US$1.4 billion brand.
By March end, total capacity at a plant, will reach 18 lakh units per annum. The
company will be increasing production capacity of 3 wheeler at its Waluj plant to 5 lakh units annually from the current 4.2 lakh units.
FACTS AND FIGURES: PROJECTED PROFIT/ LOSS FINANCIAL FIGURES: PROJECTED PROFIT AND LOSS (FY 2012)
According to Rajiv Bajaj MD,Bajaj Auto, EBITDA should be somewhere around 6 or 7 percent points higher than the industry average. Typically EBITDA is at 13 percent. The band is 10-15 percent typically. And as opposed to 13 he expects it to be at 20. Bajaj Auto Ltd, reported third-quarter profit of 667 crore,while revenue grew 27 percent to 4028 crore. The company's domestic sales in the quarter rose 22.6% to 872,682 units. The companys revenue for next fiscal is expected to grow at 25-30%. Despite rising commodity prices, company was able to maintain its margins due to low employee cost, and low operational cost, which in turn led to increase its market share to 35% from 26%. According to Maximum Securities Research, the expected net profit would be Rs.3438 crore and Earning per share(EPS) would increase from Rs.105 to Rs. 119. Precisely, industry is expected to grow at 11 to 15 percent and Pulsar market share will continue to be 50 % plus. Pulsar proportion will continue to grow in Bajajs portfolio.
BIBLIOGRAPHY
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