Introduction

IRISBUS IVECO of Italy is an international company owned by Fiat group is currently offering full country specific buses and also luxurious coaches for various purposes since its reborn in 2003. On the other hand Amsia Motors Limited is famous for its joint venture businesses many countries automobile companies which is in operation since 1986. Going into joint venture investment between IRISBUS IVECO and Amsia Motors Limited in Bangladesh will be a revolutionary step in the history of Bangladesh automobiles industries because they both have experience and they are both capable of using resources efficiently and effectively. But most importantly they are backed by the giant parent companies and financial institutions which may help to smoother their operation in this country. So coming into a third world country like Bangladesh and working together they can more diversify their segments and may provide more different options to this Asian region according to country specific needs. Country like Thailand, Malaysia, India or even Bangladesh itself can be potential market as transportation needs increment day by day.

Strategic Marketing

Why Bangladesh?

IRISBUS IVECO and Amsia Motors Ltd are going to establish an assemble centre in Bangladesh. The reasons are1. Cheap Labor Cost: The main reason behind the establishment of this assemble centre in Bangladesh is cheap labor cost. It is a well establish fact that Bangladesh has an advantage of cheaper labor and lower energy cost. Labor cost is only 23 cents/hr which is very low compare to other countries. IRISBUS IVECO and Amsia Motors Ltd can easily decrease their labor cost using those cheap manpower.

2. To Capture Asian Market: Another reason is to capture the Asian market. Asian market is one of the biggest markets of the world. As a result, most of the companies try to enter those markets. This new assemble centre in Bangladesh allow IRISBUS IVECO and Amsia Motors Ltd to sell their buses at low cost in those Asian markets which will be very profitable for them.

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Strategic Marketing

Target Market
IRISBUS Iveco is very expensive for third world countries. The unit price is very high. As a result, most of the countries cant afford those buses. To capture those potential markets IRISBUS Iveco and Amsia Motors Ltd are going to joint venture in Bangladesh. Primarily our target market will be Thailand, Malaysia and Bangladesh. The reason behind this is that Thailand and .Malaysia are two of the most economically strong countries of Asia and they are a very popular destination for the tourists. Thats why the tourism companies there are always looking for best transportation facilities to their customers. So, to meet their needs and demands we will supply them with our quality products. As for Bangladesh, Our main aim is to be able to capture the market of intercity buses.

Malaysia:
Malaysia is on the Malay Peninsula in Southeast Asia. The nation also includes Sabah and Sarawak on the island of Borneo to the east. They are developing country in Asia and their main focus in tourism. So we have a big market in this country. Major Bus Companies: Major bus companies are

RapidPenang Transit Link Milan Travel Hin Bus RapidKL SJ Bus

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Strategic Marketing

Thailand
Thailand officially the Kingdom of Thailand is a country in Southeast Asia with coasts on the Andaman Sea and the Gulf of Thailand. With great food, a tropical climate, fascinating culture and great beaches, Thailand is a magnet for travelers the world over. Major Bus Companies: Major bus companies are

Green Bus - Chiang Mai-Chiang Rai Nakhon Chai - premium service Cherdchai 999 "The Transport Co" Sombat Tour Bangkok Mass Transit Authority (BMTA) Baw Kaw Saw (BKS)

Bangladesh
Bangladesh is a developing country. Tourism sector in Bangladesh has experienced massive growth in recent years. Majority of growth is contributed by local tourists. It is believed to be a major tourist destination if properly advertised. Nonetheless, few government and private initiatives have been taken to attract foreign tourists. Though small in area, Bangladesh is quite rich in heritage with numerous historical and archeological sites. It has the longest natural unbroken sea beach and five World Heritage Sites. Major Bus Companies: Major bus companies are Green Line. Shohagh. Soudia S. Alam. Hanif
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Strategic Marketing

Competitor Analysis

As IRISBUS Iveco and Amsia Motors Ltd are going to sell their buses on Thailand, Malaysia and Bangladesh market, they have to face their competition from others. Many well established companies are already doing business in those countries and capture maximum market share. Some of the major competitors are

Mercedes-Benz Scania Volvo Bus Hino Motor

These four bus manufacturers are the main competitors we have to face to gain any kind of market share in Bangladesh. One of our main advantages will be that we will assemble our buses in Bangladesh. As a result our cost will be lower than them. Another advantage we are going to have is that we can provide them with customer care centre as all our production facility will be here.

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Strategic Marketing

Market Segmentation

Market Segmentation for Thailand and Malaysia

Geographic segmentation calls for division of the market into different geographical units, such as nations states, region, countries, cities or neighborhoods. In the south Asian context geographical segmentation assumes importances due to variations in consumer preference and purchase habits across different region, different states of those countries. We are going to segment IRISBUS Iveco and Amsia Motors Ltds market in terms of regions, countries, cities which is purely based on geographic segmentation. We will divide their market asI. II. III. City Service Inter-City Service Tourism Service.

I.

City Service: First of all, they can provide city service buses in the major cities of

Thailand and Malaysia. Those buses will provide short- distance travel to get around locally. There will be two types of city service buses-

Local Bus: Not very fast, can be overcrowded when full and stop at every stoppage. Express Bus: Relatively fast, sitting and stop at few stoppages

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Strategic Marketing
II. Inter-city Service: Secondly, they can provide inter-city service buses in the major

cities of Thailand and Malaysia. Those buses will provide long- distance travel to get around one city to another. There will be two types of city service buses-

Deluxe: as per 1st class with only 32-34 seats and comfortable Super Deluxe: Super-Deluxe is very similar to Deluxe, except there are only 24 seats, which are wider comfortable seats and fully air conditioned.

III.

Tourism Service: Finally, they can provide tourism service buses in the major cities

of Thailand and Malaysia. As we already spoke that those two countries are very much popular for their tourism, there will be a huge potential for IRISBUS Iveco and Amsia Motors Ltd for doing business. So, tourism can be a huge segment for them. They can provide some luxurious mini buses for the tourists for their travels.

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Strategic Marketing Product segmentation in Bangladesh

City bus: The city bus will be only for Dhaka city. Now we use TATA for our daily transportation. These are not giving us well service. These buses consume more fuel and polluting our environment. Though the engine quality of IRISBUS is better than TATA, so we can use CREALIS and GX-127 model as our daily transportation. Intercity: Now we use TATA or HINO, VOLVO or MARCEIDIS BENZ for our intercity transportation. Those buses are not enough luxurious and also very expensive. We can use ARWAY, CROSSWAY model for our intercity communication just like Dhaka Chittagong, Dhaka-Sylhet etc. Tourism or grand tourism: The design will be certainly one of the strength points of the

vehicles in this range, together with top travel comfort, high quality materials and technological equipment with the most advanced active and passive safety systems. For this segment we can use DOMINO, EVADIES etc.

Fig: GX 127

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Strategic Marketing

Fig: airway

Fig: Majelys le

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Strategic Marketing

Marketing Strategies
Porters Generic Strategies

Porters generic strategy is mainly focused on three general types of strategies. These are market differentiation, overall cost leadership and focus strategy. As our product is buses and our target markets are different from each other like Bangladesh is economically not as developed as Thailand or Malaysia. So we have to follow a different strategy for Bangladesh.

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Strategic Marketing Cost Leadership Strategy

Firms that succeed in cost leadership often have the following internal strengths: Access to the capital required to make a significant investment in production assets; this investment represents a barrier to entry that many firms may not overcome. Skill in designing products for efficient manufacturing, for example, having a small component count to shorten the assembly process. High level of expertise in manufacturing process engineering. Efficient distribution channels.

Differentiation Strategy
Firms that succeed in a differentiation strategy often have the following internal strengths: Access to leading scientific research. Highly skilled and creative product development team. Strong sales team with the ability to successfully communicate the perceived strengths of the product. Corporate reputation for quality and innovation.

Focus Strategy
Concentrates on a narrow segment and within that segment attempts to achieve either a cost advantage or differentiation. Because of their narrow market focus, firms pursuing a focus strategy have lower volumes and therefore less bargaining power with their suppliers. However, firms pursuing a differentiation-focused strategy may be able to pass higher costs on to customers since close substitute products do not exist.

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Strategic Marketing
Firms that succeed in a focus strategy are able to tailor a broad range of product development strengths to a relatively narrow market segment that they know very well.

For Thailand and Malaysia

For Thailand and Malaysia we are going to follow the market differentiation strategy. The main reason behind this is that they are economically two of the strongest countries in Asia. These two countries are a very popular among European and Western tourists. As a result the tourism companies are always looking for gaining competitive advantage over their competitors. We are going to place ourselves as a provider of high quality buses and services. Irisbus already have a very good brand image in European countries. By taking advantage of the good brand Image we will try to place our products in the upper echelon in our customers eyes.

For Bangladesh
Bangladesh is economically not as strong as Thailand or Malaysia. The transport companies here have to export their buses from their European manufacturers. Service quality of those buses decreases at a very alarming rate and their fuel consumption is also very high. As price is a very important issue here our strategy will be to gain the overall cost leadership. We will try to provide them will buses will low cost but with high level of services they are getting right now. This will be our primary strategy in Bangladesh.

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Strategic Marketing

Competitive Advantage
Like generic strategy here also we are going to use two different strategies for Bangladesh and one for Thailand and Malaysia.

For Thailand and Malaysia

High

Maintain Specialty
Degree of Differentiation

Outstanding Success

Hope for Growth Market

Low

Maintain Cost advantage

High Relative Cost

Low

For Thailand and Malaysian Market we are going to use the strategy of Maintain specialty. To successfully implement this strategy we have to focus on Differentiation High. Relative Costs High. We are following this strategy here because high differentiation is important to capture the market shares in Thailand and Malaysia. For this reason the cost of our product will be relatively higher.

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Strategic Marketing For Bangladesh

High

Maintain Specialty

Outstanding Success

Degree of Differentiation

Hope for Growth Market

Low

Maintain Cost advantage

High Relative Cost

Low

For Bangladesh Market we are going to use the strategy of Maintain cost advantage. To successfully implement this strategy we have to focus on Differentiation Low. Relative Costs Low. We are following this strategy here because differentiation is less important in Bangladeshi market. So, our main focus here will be to try to maintain a low cost of production to capture the market share.

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Strategic Marketing

Strategic Factors
For Thailand and Malaysia
Environment 5 4 Product 3 2 1 0 Strategic Factors Profit potential

Competition

Prospect

Market Entry

The above graph is a display of strategic factors we are considering before entering the market. The graphs have been shown in a 1 to 5 scale, 1 being the lowest and 5 being the highest. For the Thailand and Malaysian market we gave environmental factors 2 points, because the governments of those two countries are not very strict on their environmental laws like the European or Western governments. We gave profit potential 3.5 because of the high competition in those markets but huge opportunity. For business prospect we think these two countries are 4 because they are both financially strong countries and their country is very popular among tourists. Market penetration will be difficult in those two countries that is why is pointed it at 2.5. Competition will be higher there thats why we marked it as 3.5. For those two countries our product has to be of best quality and differentiated, thats why we marked it at 4.5.

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Strategic Marketing

For Bangladesh
Environment 5 4 Prospect 3 2 1 0 Strategic Factors Competition

Market entry

Product

Profit Potential

For the Bangladeshi market we gave environmental factors 1.5 points, because the governments of this country are not very strict on their environmental laws like the European or Western governments. We gave profit potential 4.5 because we will have our own manufacturing plant in that country and the cost will be low. But for business prospect we think Bangladesh is a 3.5 because of cheap labor cost and the prospect of capturing Asian market. Market penetration will be a little easier in Bangladesh because we will manufacture there, thats why we marked it as 4. Competition will be lower there thats why we marked it as 2. For Bangladesh our product has to be of low cost and better service, thats why we marked it at 3.5.

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Strategic Marketing

Price Sensitivity

For Thailand And Malaysia

High

Commodity Strategy

Transitional Strategy

Price Sensitivity

Hybrid Strategy
Low

Specialty Strategy

Few Perceived Differences

Many

For Thailand and Malaysia we are going to follow the specialty strategy. A specialty strategy is initiated only when you want to initiate or continue efforts to differentiate your offering. In Thailand and Malaysian market our main focus will be more on creating a differentiate product rather than in price. Price Sensitivity Low Perceived Differences Many

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Strategic Marketing For Bangladesh

High

Commodity Strategy

Transitional Strategy

Price Sensitivity

Hybrid Strategy

Specialty Strategy

Low

Few Perceived Differences

Many

For Bangladeshi we are going to follow the commodity strategy. A commodity strategy is recommended when your Efforts should be exerted to increase the firm's market share thereby lowering marginal costs. In Bangladeshi market our main focus will be more on creating a overall cost leadership rather than differentiation. Price Sensitivity High Perceived Differences Few

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Strategic Marketing

Porters Five Forces model

Industry Attractiveness
Threat of New entrants 4 3 Burgaining Power of Suppliers 2 1 0 Threat of Substitute Products Industry Attractiveness

Bargaining Power of Buyers

Rivalry Among Existing Firms

The above model is known as Porters Five forces Model. Porter explains that there are five forces that determine industry attractiveness and long-run industry profitability. These five "competitive forces" are - The threat of entry of new competitors (new entrants). - The threat of substitutes. - The bargaining power of buyers. - The bargaining power of suppliers. - The degree of rivalry between existing competitors.

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Strategic Marketing
The threat of entry of new competitors

The threat of entry of new competitors is moderate here, because we will be one of the first companies to have a manufacturing plant here in Bangladesh. If we succeed in our venture then there are chances that other big companies will follow our footsteps. The threat of substitutes

The threat of substitutes is very high for our products. As our products are used for transportation, there are always some substitutes available for the customers with better facilities. The bargaining power of buyers

As we are going to enter in a market already filled big players, there is going to be a lot of competitions for us. Because of this fact the buyers of our product are going to have a lot of options before them. So, the bargaining power of buyers is going to be high. The bargaining power of suppliers

The buses are going to be assembled here in Bangladeshs manufacturing plant. So, the bargaining power of the suppliers will be very low. The degree of rivalry between existing competitors

The competition is very high at the moment with big players already in the field. But we are going to have a advantage here because of our manufacturing plant.

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Strategic Marketing

Internal Factors

Internal Factors
The Enterprise 5 4 3 Production 2 1 0 Internal Factors Marketing

Development

Customer Service

The above model showed the companys internal factors and which factors are more important to the company. For us customer service is going to be very important. Because we are going to enter a market already filled with experienced companies. So, to differentiate from others we are going to provide our customer with the best service possible to our customers. After customer service we are going to focus on our marketing approach. For this we are going to use Holistic Marketing approach which is a combination of four marketing strategies 1. Internal Marketing. 2. Integrated Marketing. 3. Socially Responsible Marketing. 4. Relationship marketing.

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Strategic Marketing

In the business of transportation development is always happening. So, we are going to give equal importance to our product development department also. Our production will depend on the amount of order we get from our customers. So, our marketing department, sales department and production department we have to work together to get the work done.

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Strategic Marketing

Conclusion
Marketing process and strategies will always go together. Because no matter how much marketing is done, it has to be done in a way that can convert your potential buyer into a buyer. After setting our target segment and strategies, we can come up with a conclusion that we can easily enter our targeted countries because these countries have huge transportation needs and these countries large portion of income depends on tourism and industrial activities. At the same time, the political and economic conditions of both countries are very much favorable for Irisbus Iveco and Amsia Motors Ltd. We believe our marketing approach will help Irisbus Iveco and Amsia Motors Ltd to capture maximum market share from those markets. So to say choosing these countries as an entering point for our joint venture we guess it will be graceful in near future.

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