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A STUDY ON

MARKETING STRATEGIES OF HERO MOTO CORP.

Hero MotoCorp Showroom


Address: Gottigere, Bangalore Urban, Bengaluru,
Karnataka 560083
Phone:1800 266 0018

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EXECUTIVE SUMMARY
Hero Moto Corp the Principal activities of the Company is manufacturing and
marketing of motorcycles and spare parts. The Company is a joint venture between
Hero Group, India. The Motorcycles of the Company features facilities such as four
stroke technology, phenomenal fuel economy and low exhaust pollution levels. The
major brands of the Company include Splendor, Joy and Passion. The two
manufacturing facilities of the Company are located in Haryana. Motorcycles
accounted for 95% of fiscal 2009 gross revenues and spare parts, 5%. Grows over
500% in five years For 2010-11, volume up by 38 per cent ; net profit soars by 88 per
cent; total turnover up by 42 per cent Achieves a high 48 per cent motorcycle market
share; and 33 per cent two-wheeler market share Announces 350 per cent final
dividend and 250 per cent celebration dividend (over and above special interim
dividend of 250%) Over the last five years, company's total turnover grows by a
whopping 580 %; PAT by 919 % New Delhi, April13, 2011: Hero Moto Corp Co.., the
newly crowned World No. 1 two wheeler companies, declared outstanding financial
results for the year 2010-11. Profit after tax (PAT) is Rs. 462.93 crore, a growth of 88
per cent. The company's total turnover (sales plus other income, net of excise) grew to
Rs. 4539.49 crore, a growth of 42 per cent. In a landmark run, the company achieved
a 48 per cent market share in the motorcycle category during the year; and 33 per cent
of the total two -wheeler market. The company recorded a cumulative sale of over
14.25 lacs motorcycles for the year 2010-11.
The company's Spare Parts business also showed a remarkable increase of 39 per
cent, taking the annual sales to Rs. 209 crore. Encouraged by the response the
company has set a target of Rs. 250 crore for the current financial year.
Hero Moto Corp's growth over the last five years has been truly outstanding, with
both revenue and PAT showing significant jumps of over 5 times. While the revenue
increased from Rs. 783 crore in 2008-09 to Rs. 4539 crore in 2010-11. PAT has
increased from Rs. 50 crore in 2008-09 to Rs. 463 crore in 2010-11. The total sales
has also increased from 2,68,931 motorcycles in 2010-11 to 14,25,302 motorcycles in
2010-11, with volume market share jumping from 27 per cent to 48 per cent in
motorcycles; and 9% to 33% in two-wheelers.Mr. Brijmohan Lall, Chairman and
Managing Director, Hero Moto Corp., commending the company's achievement said,

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"I thank all our stakeholders - our Hero Moto Corp family of employees, ancillaries,
-vendors, dealers, other business associates, and most importantly, our customers.
They have been instrumental in our achieving the World No.1 status. I would also like
to make special mention of the excellent support provided all through by our joint
venture partners Hero Moto Corp Company, and Hero Cycles Ltd. Our relationship
with them has been wonderful and mutually satisfying. As we move forward, our
collaborative approach will help us continue our lead." On the momentous occasion,
Mr. Pawan Munjal, Director and CEO, Hero Moto Corp. Said, "The key reason for
our success has been our continuous pursuit of pro-actively delivering value and
delight to our customers. This is evident from the pioneering initiatives we undertook
during 2011 - like the full two-year warranty on all Hero Moto Corp models, and the
launch of the most comprehensive Customer Relationship Programme, 'The Hero
Moto Corp Passport Programme'. Further, despite strong competition and pressures
on the economy as a whole, the company has improved operating profits significantly,
mainly because of cost rationalization, strong working capital management and
manufacturing efficiencies."He added, "We are committed to continue our lead, by
delivering even better value to the customers, in the year ahead. Accordingly, several
new and exciting product launches are lined up for 2008-09, and in the future. The
manufacturing facilities to support the customer demand would also be pro-actively
set up, as has been done till now." Especially present on the occasion was Mr. K
Suzuki, Senior Managing Director, Hero Moto Corp Company, Japan, who had flown
in only that morning to attend the Press Conference and the World No. 1 celebrations.
Clearly ecstatic he said, I congratulate Hero Moto Corp for their wonderful and
consistent achievements. Last year they achieved the distinction of being No. 1 Joint
Venture of Hero Moto Corp Company worldwide; and this year achieved the unique
status of World No. 1 two wheeler companies. Our relationship has always been
strong and solid. We are proud of this achievement for the Hero Group, Hero Moto
Corp Company, and the Indo-Japanese co-operation. We would continue to provide all
the necessary support to Hero Moto Corp, for it to remain on the top".

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TABLE OF CONTENTS
CHAPTER TITLE
1 INTRODUCTION
2 INDUSTRY PROFILE &
COMPANY PROFILE
3 LITERATURE REVIEW
4 RESEARCH METHODOLOGY
NEED OF THE STUDY
OBJECTIVE OF THE STUDY
RESEARCH DESIGN
LIMITATIONS OF THE STUDY
5 DATA ANALYSIS &
INTERPRETATIOIN
6 CONCLUSION &
RECOMMENDATIONS
7 BIBLIOGRAPHY &
QUESTIONNAIRE

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CHAPTER 1
INTRODUCTION

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INTRODUCTION
The Indian Two Wheeler Industry
The Indian two wheeler sector contributes the largest volumes amongst all the
segments in automobile Industry. Though the segment can be broadly categorized in
to 3-sub segments viz; scooters, motorcycles and mopeds; some categories introduced
in the market are a combination of two or more segments e.g. scooter and stepthrus.
The market primarily comprises five players in the two wheeler segment with most of
the companies having foreign collaborations with well known Japanese firms earlier.
But with most of the companies now planning 100% subsidiaries in India.
In the last four to five years, the two-wheeler market has witnessed a market shift
towards motor cycles at the expense of scooters. In the rural areas, consumers have
come to prefer sturdier bikes to with stand the bad road conditions. In the process of
the share of motor cycle segment has grown from 48% to 58%, the share of scooters
declined drastically from 33% to 25%, while that of mopeds declined by 2% from
19% to 17% during the year 2009-10. All new vehicles are a now being replaced by 4
stock motorcycles. Reduced excise duties and fierce competition has led to a fall in
prices of certain models.
Hero, a name synonymous with two wheelers in India, began its journey around four
decades ago. Starting as a manufacturer of by cycle components, hero has today
grown into a multiunit, multi-product, geographically diversified group of companies.
The hero group began with simple Philosophy: to provide excellent transportation to
the common man, at a price he could easily afford. Even today the dream providing
the total satisfaction is all its sphere of activity. To consumers, in excellent products at
an affordable price; a thorough understanding the fast changing consumer
understanding the fast changing consumer behaviour, new market segment and
opportunities, and marketing mix sensitive changing customer needs from the core of
Heros marketing strategy and philosophy.
Hero Moto Corp. is one of the leading companies in the two wheeler Industry. At
present, it is segment with around 47% the market share during financial yr. 2000-01.
The company ahs emerged one of the most of successful players, much ahead of it
competitors by it superior and reliable product quality complemented with excellent
marketing techniques.

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Hero Moto Corp has been an early entrant in the 4-stroke segment of the two wheeler
industry. With a right mix of product styling and pricing the company has graped the
4-stoke market as compared to Bajaj Auto and TVS.
TVS Motors Ltd has been the largest manufacturer of mopeds which are prevalent as
a low cost transportations and provide a tremendous potential is all parts of India.
However the company is likely to face threat Bajaj Auto Ltd (BAL) which continued
its price based competitions and Hero Moto Corp cycle and Scooter Ltd. a new
entrants in the 2 wheeler market.
Infact the company has achieved excelled the Industry growth rates by a huge margin.
From April to December 2008 while the motor cycle industry sales were upto 38.68%
TVS motors sales surged by a whooping 73.6% sat more importantly it is the success
of its model Victor.
Baja Auto has continued with its impressive performance witnessing significant
growth is the motor cycle and three wheeler segments. Based on the performance fill
data one can expect the company to meet it excellence by FY09.
Hero Moto Corp is the largest player is the motorcycle segment. Focused on
contemporary design and style, the company has a compare leusine ranges bikes viz;
CD-100 DX
CD-100 SS
Splendor
Street Smart
Steek
CBZ
Passion
It splendor model is an urban centric with its fuel efficiency which accounts to over
60-70% of its sales. The passion launched in mid Jan. 2001 has a resending success
contributing to 26% of its sales.
TVS offers a wide ranges of two-wheelers motorcycles- Victor/Fiero/Max100/
max100R/Max DL.
Scooterette- TVS scooty
Moped- chap/XL/XL super/XL supper HD/sports.
TVS plans to launch 4 new models in the coming 15 months. A 4-stroke version of
Indias best selling scooterttes; TVS-scooty and 4-stroke version of the existing
moped line will be launched this year.

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Bajaj Auto Ltd: Offer product a service to the customers so as to satisfy their needs.
Its having 4-stroke single cylinder natural air cool the displacement of engine is 111.6
CC having the engine power it 7-7 bhp at 7000 spm. The bike is having a hydrometric
disc brake in front wheel. Flash is an added future in the bike.
In 1993 BAL manufactured 12 different model 5-5 scooter model, 3-motorcycle
model, moped model, 3-three wheeler model.
But in the recent year Bajaj developed various model in the motorcycle segment
which providing good riding conditions is urban road as well as rater roads. Scooter-
cub/super/super FE/chetak/stride/Msl Priya.
Moped- Bajaj Sunny.
Motorcycle- M-80/kawasaki RTZ/Kawasaki45 by 1993 and latest model are.
Eliminator/Pulsor 180/Pulsor 150/Boxer/Caliber Crowa/Caliber
Sales performance of the player:
Hero Moto Corp repeated a y-o-y growth of 6.3% is its motorcycle sales for the
month of Jan 2006 at 1,45,708 units. Export during the month have surged almost
64% y-o-y. On a month on-month basis the sales growth has been even higher up
16.5%.
MOTORCYCLE APRIL TO DEC 2010 APRIL TO DEC 2009 % CHANGE
INDUSTRY SALE 2897842 2089637 38.68
INDUSTRY SALE 1281342 1026102 24.85
MARKET SHARE 44.21 49.11
Bajaj Auto: Bajaj auto has reported y-o-y growth of 19.8% in motorcycle sales for Jan
2006 at 75059 units. On a month-on-month basis the growth is 8.8%. Export
performance continues to be impressive with 10,089 two and three wheelers exported
in Jan 2006, a growth of 98.6% y-o-y.
Two wheeler sales for the current year are up 6.8%. The growth is driven sharply in
the motor cycle sales upto 37% in two wheeler segment, the share of motor cycle has
jumped from 52.8% to 67.8% during the current year. this sharp growth in the motor
cycle can be attributed to the positive response received by its need products and the
encouraging performance of select existing model.

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SALES (UNITS) JAN 10 JAN 09 % CHANGE APR-JAN 10 APR-JAN 09 % CHANGE
SCOOTERS (GEARED) 20211 30233 -33.15 235829 348700 -32.37
SCOOTER- UNGEARED 4349 4333 0.37 56072 57686 2.80
STEPTHRUS 4563 5810 -21.46 47636 59576 -20.04
MOTORCYCLE 75059 62640 19.83 717397 523508 37.04
TOTAL 2-WHEELER 104182 103016 1.13 1056934 989470 6.82
THREE WHEELERS 17426 14405 20.97 163359 132864 22.95
TOTAL 121608 117421 3.57 1220293 1122334 8.73
India is the second largest manufacturer and producer of two wheelers in the world. It
stands next only to Japan and China in terms of the number of two-wheelers produced
and domestic sales respectively. This distinction was achieved due to variety of
reasons like restrictive policy followed by the Government of India towards the
passenger car industry, rising demand for personal transport, inefficiency in the public
transportation system etc.
The Indian two-wheeler industry made a small beginning in the early 50s when
Automobile Products of India (API) started manufacturing scooters in the country.
Until 1958, API and Enfield were the sole producers.
In 1948, Bajaj Auto began trading in imported Vespa Scooters and three-wheelers.
Finally, in 1960, it set up a shop to manufacture them in technical collaboration with
Piaggio of Italy. The agreement expired in 1971.
In the initial stages, the scooter segment was dominated by API, it was later
overtaken by Bajaj Auto. Although various government and private enterprises
entered the fray for scooters, the only new player that has lasted till today is LML.
Under the regulated regime, foreign companies were not allowed to operate in India.
It was a complete seller market with the waiting period for getting a scooter from
Bajaj Auto being as high as 12 years.
The Motorcycles segment was no different, with only three manufacturers viz Enfield,
ideal Jawa and Escorts. While Enfield bullet was a four stroke bike, Jawa and the
Rajdoot were two-stroke bikes. The motorcycle segment was initially dominated by
Enfield 350cc bikes and Escorts 175cc bike.
The two wheeler market was opened to foreign competition in the mid-80s. And the
then market leaders- Escorts and Enfield were caught unaware by the onslaught of the
100cc bikes of the four Indo-Japanese joint ventures. With the availability of fuel

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efficient low power bikes, demand swelled, resulting in Hero Moto Corp then the only
producer of four stroke bikes (100cc category), gaining a top slot.
The first Japanese motorcycles were introduced in the early eighties. TVS Suzuki and
Hero Moto Corp brought in the first two-stroke and four stroke engine motorcycles
respectively. These two players initially started with assembly of CKD kits, and later
on progressed to indigenous manufacturing. In the 90s the major growth for
motorcycle segment was brought in by Japanese motorcycles, which grew at a rate of
nearly 25% CAGR in the last five years.
The Industry had a smooth ride in the 50s, 60s and 70s when the Government
prohibited new entries and strictly controlled capacity expansion. The industry saw a
sudden growth in the 80s. the industry witnessed a steady growth of 14% leading to a
peak volume of 1.9mn vehicles in 1990.
The entry of Kinetic Hero in mid-eighties with a variometric scooter helped in
providing ease of use to the scooter owners. This helped in inducing youngsters and
working women, towards buying scooters, who were earlier inclined towards moped
purchases. In the 90s, this trend was reversed with the introduction of scooterettes. In
line with this, the scooter segment has consistently lost its part of the market share in
the two-wheeler market.
In 1990, the entire automobile industry saw a drastic fall in demand. This resulted in a
decline of 15% in 1991 and 8% in 1992, resulting in a production loss of 0.4 mn
vehicles. Barring Hero Moto Corp , all the major producers suffered from recession in
FY93 and FY94. Hero Moto Corp showed a marginal decline in 1992.
The reasons for recession in the sector were the incessant rise in fuel prices, high
input costs and reduced purchasing power due to significant rise in general price level
and credit crunch in consumer financing. Factors like increased production in 1992,
due to new entrants coupled with the recession in the industry resulted in companies
either reporting looses or a fall in profits.
India is one of the very few countries manufacturing three- wheelers in the world. It is
the worlds largest manufacturer and seller of three-wheelers. Bajaj Auto commands a
monopoly in the domestic market with a market share of above 80%, the rest is shared
by Bajaj Tempo, Greaves Ltd and Scooters India.
The total number of registered two wheelers and three-wheelers on road in India, as
on March 31, 1998 was 27.9mn and 1.7mn respectively. The two wheeler population
has almost doubled in 1996 from a base of .6mn in 1990.

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Automobile Industry in India TVS Centra crosses an astounding 20,000 sales mark in
40 days Hosur, March 6, 2006: TVS Motor Company today announced that the sales
of TVS Centra, powered by the indigenously developed Variable Timing Intelligent
(VT-i) engine technology crossed 20,000 units in just 40 days since its launch in mid
January 2004, the best ever clocked by any new product from the TVS Motor
Company stable. This achievement is expected to spiral the overall growth of TVS
Motorcycles sales in the coming months.
The impressive sales figures reflect the customer's faith in the technological capability
of TVS Motor Company to fully live up to its promise of delivering a world-class
product at an affordable price. Due to excellent customer feedback across the country,
TVS dealers are being pressurised with enquiries on the new 100 CC 4 Stroke Centra
and its revolutionary VT-i engine technology. Having caught the public's imagination,
TVS Centra has fully lived up to its promise of a 'Fill it Once a Month Bike' where a
full tank of petrol lasts for a month based on the average use of motorcycle customers.
A panel of leading auto experts in India, after having tested TVS Centra, have
endorsed the fact that it was the 'best in its class' and also commended TVS Motor
Company on its technology prowess and innovation.
TVS Centra is powered by VT-i engines which are designed to deliver superb
performance on fuel efficiency and torque delivery based on three fundamental
actions namely variable ignition timing and superior combustion of fuel, friction
reduction and fuel wastage reduction.
Added to its technological edge are features that include attractive price, fuel
efficiency, low maintenance, contemporary style, ride comfort and backed by TVS
Motor Company's reliability, making it truly the preferred two-wheeler in its class.
Chennai, January 5, 2004: India's leading two wheeler major, TVS Motor Company's
commitment to produce the best technology in its products for its customers has led to
the launch of TVS Centra with Variable Timing intelligent engines
(VT-i), a 100 CC 4 Stroke motorcycle targeted at the Popular Segment.
This revolutionary new VT-i engine technology, developed indigenously by TVS
Motor Company, inbuilt into TVS Centra will make it the most fuel-efficient
motorcycle in the Country. It will be rightfully called as the 'Fill it Once a Month
Bike' where a full tank of petrol will last for a month based on the average use of
motorcycle customers.

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The VT-i Engines by TVS Motor Company will go down in the history of the
Automobile Industry in India as one of the most innovative technology
developed indigenously. The VT-i engines are designed to deliver superb performance
on fuel efficiency and torque delivery based on three fundamental actions namely
variable ignition timing and superior combustion of fuel, friction reduction and fuel
wastage reduction. This action facilitates deceleration fuel cut off, faster warm up of
the Engine and has four curve ignition mapping
Like all TVS Motor Company products, TVS Centra too has been engineered and
designed keeping in mind extensive customer feedback and changing customer needs.
TVS Centra will be the first motorcycle in India that will bundle price, mileage,
maintenance, style, reliability, power, ruggedness and ride comfort making it truly a
value for money personal transportation two-wheeler. Those who want all these
performance attributes in a commuter motorcycle at a great price; nothing will beat
the TVS Centra for all the advantages it offers.
TVS Centra is built around to give a mileage that will offer atleast 10 per cent more
than any other motorcycle in the country, today. It will be powered by 7.5 Brake
HorsePower (Bhp) at 7250 RPM making it the most powerful motorcycle in its class.
TVS Centra will also be known for its nimble handling and riding comfort enabling
easy maneuvering even in busy city traffic. Its contemporary style with big muscular
tank and well-rounded looks with a horizontal engine and superior ergonomics will
mark a new standard in the popular segment of two wheelers. It will come with
Econometer to keep a check on the mileage / power ratio, wide and skid free seat and
Utility space.
Victor the Saviour
TVS launched Victor 110 cc model in September 2001, with leading cricketer Sachin
Tendulkar as the brand ambassador the model has proved to be a big success. The
success of TVS Victor is especially significant because it was developed with
indigenous technology.

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Two stroke Max Range On the way out
The company is currently looking forward to phase out its two stroke Max range,
which is perceived to be less fuel efficient with a new four stroke range. The change
over is expected to take place by the end of June 2010.
Two new launches could out TVS on a high growth trajectory
TVS Centra
TVS Centra a new 100 cc model has recently been launched and the company has set
ambitions targets of achieving monthly sales in the range of 15000-20000 bikes per
month.
Also, a new upgraded 125 cc TVS Victor has been launched which will improve the
trajectory of the company.
Three Wheeler Project- Entering A New Market
TVS Motor has set the stage for entry into the three-wheeler markets with the setting
up of a new plant at Nanjangud, near Mysore in Karnataka. We understand that the
company would be targeting the sub-one ton passenger and goods carriers segment of
the market.
With an investment of about Rs 50 crore in phase-1, it will cater to both passenger and
cargo segments. The total investments for the three wheeler and four-wheeler
quardricycle project are expected to be in the range of Rs 500 crore in the next two-
three years. It plans to go with petrol version of three wheelers and expects higher
demand to come from B class towns. The company expects higher margin and low
competition in three-wheeler business as compared to its two-wheeler business. Three
wheeler sales have grown at a CAGR of 7% over the last 9 years to 2.26 lakh units
FY 03, and are expected to grow at the same rate for the next five years. TVS is
expected to roll out its first three-wheeler by the end of FY05 to garner a 30% market
share with around 100,000 unit sales by the end of FY08.
Three-Wheeler Market Scenario
These are two main segments in the Indian passenger three -wheeler markets are:
Number of seats including driver not exceeding 4 and maximum max not exceeding 1
tonne.
Number of seats including driver excluding 4 but not exceeding 7 max mass not
exceeding 1.5 tonnes.
The three-wheeler goods carrier segments are:
Maximum mass not exceeding 1 tonne Others.

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Around 95% of the three-wheeler sold in India belong to the smaller vehicles category
in which Bajaj Auto is the major player and has around 90% market share. The other
players in the segment are Atul Auto and Piaggio group, Italy.
Similarly, in the three-wheeler segment, domestic sales of the goods carrying variety
grew a whopping 46.95%. This growth in 2008-09 could have possibly come from
two factors.
1) The increasing number of cities whose corporations have legislated that larger
goods carrier, like trucks be kept out for logistics purpose.
2)The increase in the number of offerings in this category, especially from companies
such as Mahindra & Mahindra and Piaggio vehicles pvt. Ltd.
Quardricycle-A new introduction in the Indian market
There is a new challenger emerging in the Quardricycle segment. These new vehicles
could impact on the entry level sales. These new vehicle could impact on the entry
level sales. Quardricycles are three wheelers converted into four wheelers by using, a
column axle. All the major three-wheeler units have prepared Quardricycles
prototypes.
Plans setting up manufacturing units in Indonesia / Vietnam
TVS motor is actively looking to set up a foothold in the south east Asian markets and
has made top level visits to Indonesia & Vietnam. Indonesia is the third largest two-
wheeler market in the world with an estimated size this year of two million units.
Presently in Indonesia there is one motorcycle for every 15 people, in Vietnam one for
every seven people. Further in Indonesia forty million households, representing 86%
of the total not having a motorcycle.
Merger of engine components Division of Lakshmi Auto components with TVS
Motor:
TVS motor would merge engine component division of Lakshmi Auto Component
Ltd. (LAC) and investments and other assests with itself and the dwap ratio has been
fixed at once phase of TVS motor for every seven share held as consideration for the
merger. Presently TVS motor holds 66.5% of equity capital of LAC, which would be
cancelled. Around 66% of LACs sales come from the engine components division,
mode of which is currently being sold to TVS motor. LACs total net sales in HI FY
09 were Rs. 69 crore and made anet profit of Rs. 10.5 crore..

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The Plastics and Rubber components division of LAC will be transferred to the
wholly owned subsidiary company, Sundaram Auto Components Ltd. The total
consideration on slump sale based is Rs. 12.25 crore.
Strong focus on R&D
The company has put in place a strong R & D team consisting 400 engineers & is
spending about 3% of its turnover on R & D every year and has in the process setup a
strong world class facility for product design and development. During 2009-10, the
company applied for 16 patents & published five technical research papers in
international conference. Modified research projects are carried in association with
leading international research labs and Indian institutes. R & D as percentage of sales
in expected to increase from 1.5% in FY o2 to 3.2% in FY 11.
Valuation
The companys valuations are dependent on five events:
Current four businesses grow at the normal industry growth rates.
New product launches achieve their targets and are well accepted by the
market.
Three wheeler foray achieve targeted volume in the desired rates of return on
capital employed.
Quadricycle foray achieve the desired rate of return on the capital employed.
Overall investment returns.
In TVS motor company VICTOR is the most popular bike and very
interestingly without any media interaction FIERO F2 has taken the 2nd spot
with CENTRA on the 3rd spot which has taken a lead with only one place
from MAX-R .It is recommended that FIERO F2 should be given equal sales
promotion than CENTRA because of its popularity has come through people
network and not through channel media.

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CHAPTER 2
INDUSTRY PROFILE
& COMPANY PROFILE

INDUSTRY PROFILE:

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Automotive industry in India

The automotive industry in India is one of the largest in the world with an annual
production of 23.37 million vehicles in FY 2014-15, following a growth of 8.68 per
cent over the last year. The automobile industry accounts for 7.1 per cent of the
country's gross domestic product (GDP). The Two Wheelers segment, with 81 per
cent market share, is the leader of the Indian Automobile market, owing to a growing
middle class and a young population. Moreover, the growing interest of companies in
exploring the rural markets further aided the growth of the sector. The overall
Passenger Vehicle (PV) segment has 13 per cent market share.
India is also a prominent auto exporter and has strong export growth expectations for
the near future. In FY 2014-15, automobile exports grew by 15 per cent over the last
year. In addition, several initiatives by the Government of India and the major
automobile players in the Indian market are expected to make India a leader in the
Two Wheeler (2W) and Four Wheeler (4W) market in the world by 2020.[1]

MARKET SIZE

Auto Expo 2014, Noida


The industry produced a total 14.25 million vehicles including PVs, commercial
vehicles (CVs), three wheelers (3W) and 2W in AprilOctober 2015, as against 13.83
in AprilOctober 2014, registering a marginal growth of 3.07 per cent, year-to-year.
The sales of PVs grew by 8.51 per cent in AprilOctober 2015 over the same period
in the previous year. The overall CVs segment registered a growth of 8.02 per cent in
AprilOctober 2015 as compared to same period last year. Medium & Heavy
Commercial Vehicles (M&HCVs) registered very strong growth of 32.3 per cent
while sales of Light Commercial Vehicles (LCVs) declined by 5.24 per cent during
AprilOctober 2015, year-to-year.
In AprilOctober 2015, overall automobile exports grew by 5.78 per cent. PVs, CVs,
3Ws and 2Ws registered growth of 6.34 per cent, 17.95 per cent, 18.59 per cent and
3.22 per cent, respectively, in AprilOctober 2015 over AprilOctober 2014.[2]

INVESTMENTS
In order to keep up with the growing demand, several auto makers have started
investing heavily in various segments of the industry during the last few months. The
industry has attracted foreign direct investment (FDI) worth US$13.48 billion during

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the period April 2000 to June 2015, according to data released by Department of
Industrial Policy and Promotion (DIPP).
Some of the major investments and developments in the automobile sector in India
are as follows:

Global auto maker Ford plans to manufacture in India two families of engines
by 2017, a 2.2 litre diesel engine code-named Panther, and a 1.2 litre petrol engine
code-named Dragon, which are expected to power 270,000 Ford vehicles globally.
The worlds largest air bag suppliers Autoliv Inc, Takata Corp, TRW
Automotive Inc and Toyoda Gosei Co are setting up plants and increasing
capacity in India.
General Motors plans to invest US$1 billion in India by 2020, mainly to
increase the capacity at the Talegaon plant in Maharashtra from 130,000 units a
year to 220,000 by 2025.
US-based car maker Chrysler has planned to invest Rs 3,500 crore (US$525
million) in Maharashtra, to manufacture Jeep Grand Cherokee model.
Mercedes Benz has decided to manufacture the GLA entry SUV in India. The
company has doubled its India assembly capacity to 20,000 units per annum.
Germany-based luxury car maker Bayerische Motoren Werke AGs (BMW)
local unit has announced to procure components from seven India-based auto
parts makers.
Mahindra Two Wheelers Limited (MTWL) acquired 51 per cent shares in
France-based Peugeot Motorcycles (PMTC).[2]

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GOVERNMENT INITIATIVES

Isuzu's newly inaugurated manufacturing plant in 2016 at Sri City,Andhra Pradesh,


India
The Government of India encourages foreign investment in the automobile sector and
allows 100 per cent FDI under the automatic route.
Some of the major initiatives taken by the Government of India are:

The Government of India aims to make automobile manufacturing the main


driver of "Make in India" initiative, as it expects the passenger vehicles market to
triple to 9.4 million units by 2026, as highlighted in the Auto Mission Plan (AMP)
2016-26.
In the Union budget of 2015-16, the Government has announced plans to
provide credit of Rs 850,000 crore (US$127.5 billion) to farmers, which is
expected to boost sales in the tractors segment.
The government plans to promote eco-friendly cars in the countryi.e. CNG-
based vehicles, hybrid vehicles, and electric vehiclesand also to make
mandatory 5 per cent ethanol blending in petrol.
The government has formulated a Scheme for Faster Adoption and
Manufacturing of Electric and Hybrid Vehicles in India, under the National
Electric Mobility Mission 2020, to encourage the progressive introduction of
reliable, affordable, and efficient electric and hybrid vehicles into the country.
The Automobile Mission Plan (AMP) for the period 20062016, designed by
the government is aimed at accelerating and sustaining growth in this sector. Also,
the well-established Regulatory Framework under the Ministry of Shipping, Road
Transport and Highways, plays a part in providing a boost to this sector.[3]

COMPANY PROFILE

19
Fill it. Shut it. Forget it
What started out as a Joint Venture between Hero Group, the world's largest bicycle
manufacturers and the Hero Moto Corp Company of Japan, is today the leading
manufacturer of India's largest selling motorcycle. Coming into existence on January
19, 1984. Hero Moto Corp gave India nothing less than a revolution on two-wheels
made even more famous by the 'Fill it - Shut it - Forget it' campaign. Driven by the
trust of over 30 lakh customers, the Hero Moto Corp product range today commands
as much as 47% making it a veritable giant in the industry. Add to that technological
excellence, an expansive dealer network, and reliable after sales service, and you have
one of the most customer-friendly companies.
In fact, every second bike sold in India today is a Hero Moto Corp ! Customer
satisfaction, a high quality product, the strength of Hero technology and the Hero
group's dynamism have helped HML scale new frontiers and exceed limits.
In the words of Mr. Brijmohan Lall Munjal, the Chairman and Managing Director,
"We will continue to make every effort required for the development of the
motorcycle industry, through new product development, technological innovation, and
investment in equipment and facilities and through and through efficient
management."

MILESTONE :

KEY MILESTONES OF HERO MOTO CORP


Year Event

20
1983 Joint Collaboration Agreement with Hero Moto Corp, Ltd.,
1984 Hero Moto Corp. Incorporated
1985 First motorcycle "CD 100" rolled out
1987 100,000th motorcycle produced
1989 New motorcycle model - "Sleek" introduced
1991 New motorcycle model - "CD 100 SS" introduced 500,000th motorcycle
produced
1992 Raman Munjal Vidya Mandir inaugurated - A School in the memory of founder
1994 New motorcycle model - "Splendor" introduced 1,000,000th motorcycle
produced
1997 New motorcycle model - "Street and 2nd manufacturing plant at Gurgoan
inaugurated
1998 2,000,000th motorcycle produced
1999 New motorcycle model - "CBZ" introduced Environment Management System
of Dharuhera Plant certified with ISO-14001 by DNV Holland Raman Munjal
Memorial Hospital inaugurated - A Hospital in the memory of founder
Managing Director, Mr. Raman Kant Munjal
2000 4,000,000th motorcycle produced Environment Management System of
Gurgaon Plant certified ISO-14001 by DNV Holland Splendor declared 'World
No. 1' - largest selling single two-wheeler model " Hero Moto Corp Passport
Programmed" - CRM Programmed launched
2001 New motorcycle model - "Passion" introduced One million production in one
single year New motorcycle model - "Joy" introduced 5,000,000th motorcycle
produced
2002 New motorcycle model - "Dawn" introduced New motorcycle model -
"Ambition" introduced Appointed Virender Sehwag, Mohammad Kaif, Yuvraj
Singh as Brand Ambassadors
2003 Becomes the first Indian Company to cross the cumulative 7 million sales mark
Splendor has emerged as the World's largest selling model for the third
calendar year in a row (2000, 2001, 2002) New motorcycle model - "CD
Dawn" introduced New motorcycle model - "Splendor +" introduced New
motorcycle model - "Passion Plus" introduced New motorcycle model
-"Karizma" introduced

21
2004 New motorcycle model - "Ambition 135" introduced Hero Moto Corp became
the World No. 1 Company for the third consecutive year. Crossed sales of over
2 million units in a single year, a global record. Splendor - World's largest
selling motorcycle crossed the 5 million mark New motorcycle model -
"CBZ*" introduced Joint Technical Agreement renewed Total sales crossed a
record of 10 million motorcycles
2005 Hero Moto Corp is the World No. 1 for the 4th year in a row New motorcycle
model - "Super Splendor" introduced New motorcycle model - "CD Deluxe"
introduced New motorcycle model - "Glamour" introduced New motorcycle
model - "Achiever" introduced First Scooter model from Hero Moto Corp -
"Pleasure" introduced
2006 Hero Moto Corp is the World No. 1 for the 5th year in row Fill it. Shut it.
Forget it
The joint venture between india's hero group and Hero Moto Corp company, has not only
created the world's single largest two wheeler company but also one of the most successful
joint ventures worldwide.
During the 80s, Hero Moto Corp became the first company in india to prove that it was
possible to drive a vehicle without polluting the roads. The company introduced new
generation motorcycles that set industry benchmarks for fuel thrift and low emission. A
legendary 'fill it - shut it - forget it' campaign captured the imagination of commuters across
india , and Hero Moto Corp sold millions of bikes purely on the commitment of increased
mileage
Over 20 million Hero Moto Corp two wheelers tread indian roads today. These are almost as
many as the number of people in finland , ireland and sweden put together!
Hero Moto Corp has consistently grown at double digits since inception; and today, every
second motorcycle sold in the country is a Hero Moto Corp. Every 30 seconds, someone in
india buys Hero Moto Corp's top -selling motorcycle splendor. This festive season, the
company sold half a million two wheelers in a single montha feat unparalleled in global
automotive history.
Hero Moto Corp bikes currently roll out from its three globally benchmarked manufacturing
facilities. Two of these are based at dharuhera and gurgaon in haryana and the third state of
the art manufacturing facility was inaugurated at haridwar, uttrakhand in april this year.
These plants together are capable of producing out 4.4 million units per year.

22
Hero Moto Corp 's extensive sales and service network now spans over 3000 customer touch
points. These comprise a mix of dealerships, service and spare points, spare parts stockiest
and authorized representatives of dealers located across different geographies.
Hero Moto Corp values its relationship with customers. Its unique crm initiative - Hero Moto
Corp passport program, one of the largest programs of this kind in the world, has over 3
million members on its roster. The program has not only helped Hero Moto Corp understand
its customers and deliver value at different price points, but has also created a loyal
community of brand ambassadors.
Having reached an unassailable pole position in the indian two wheeler market, Hero Moto
Corp is constantly working towards consolidating its position in the market place. The
company believes that changing demographic profile of india , increasing urbanization and
the empowerment of rural india will add millions of new families to the economic
mainstream. This would provide the growth ballast that would sustain Hero Moto Corp in
the years to come. As brijmohan lall munjal, the chairman, Hero Moto Corp motors
succinctly points out, "we pioneered india's motorcycle industry, and it's our responsibility
now to take the industry to the next level. We'll do all it takes to reach there.''

HERO MOTO CORP'S MISSION


Hero Moto Corps mission is to strive for synergy between technology, systems and human
resources, to produce products and services that meet the quality, performance and price
aspirations of its customers. At the same time maintain the highest standards of ethics and
social responsibilities.
This mission is what drives Hero Moto Corp to new heights in excellence and helps the
organization forge a unique and mutually beneficial relationship with all its stake holders.

HERO MOTO CORP 'S MANDATE


Hero Moto Corp is a world leader because of its excellent manpower, proven management,
extensive dealer network, efficient supply chain and world-class products with cutting edge
technology from Hero Moto Corp Company. The teamwork and commitment are manifested
in the highest level of customer satisfaction, and this goes a long way towards reinforcing its
leadership status.

FROM THE CHAIRMAN'S DESK LEADING WITH A DREAM

23
We had a dream. The dream of making motorcycles that would touch and transform the lives
of our customers by giving them a mode of transport that was fuel-efficient, comfortable and
environment friendly. One that would enhance their efficiency at work, enable them to share
moments of joy with their families and add up to a better quality of life.
In a scenario where the customer had a few choices, our vision was to offer the highest
quality at a reasonable price, to meet our customers expectations, and to exceed them.
Behind the success of Hero Moto Corp, is the saga of team-work. We would like to
acknowledge the role played by our jv partners, Hero Moto Corp company, all our business
associates, shareholders and employees.
In the new millennium, we stand committed to innovation, to change, to achieving
breakthroughs to moving forward in the new century, while retaining the values that have
been like a beacon in this journey thus far.
2007
- Hero Moto Corp. has appointed Mr. Yutaka Kudo as Director and
Whole-time Director of the Company in the category of Executive
Director w.e.f. April 1, 2007.
- Hero Moto Corp is the World No. 1 for the 6th year in a row
- New 'Splendor NXG' launched
- New 'CD Deluxe' launched
- New 'Passion Plus' launched
- New motorcycle model 'Hunk' launched
- 20 million production milestone achieved
2008
- Hero Moto Corp has informed that Mr. Arun Nath Maira. has been appointed as an
Additional Director in the category of Non Executive and Independent Director w.e.f.
December 20, 2008 by the Board of Directors by way of passing a resolution by
circulation.
- Hero Moto Corp Haridwar Plant inauguration
- New 'Pleasure' launched
- Splendor NXG lauched with power start feature
- New motorcycle model 'Passion Pro' launched
- New 'CBZ Xtreme' launched
- 25 million production milestone achieved
- CD Deluxe lauched with power start feature

24
- New 'Glamour' launched
- New 'Glamour Fi' launched
2010
- Hero Moto Corp has appointed Mr. Ravi Nath as an Additional Director in the
category of Non Executive and Independent Director w.e.f. October 14, 2010 by the
Board of Directors by way of Passing a resolution by circulation on October 14, 2010.
BOARD OF DIRECTORS
No. Name of the directorscategory of directorship
1 Mr. Brijmohan Lall Munjal
Chairman & whole-time director
2 Mr. Pawan Munjal managing director
3 Mr. Toshiaki Nakagawa joint managing director
4 Mr. Yutaka kudo whole-time director
5 Mr. Om prakash munjal non-executive director
6 Mr. Sunil kant munjal non-executive director
7 Mr. Masahiro takedagawa non-executive director
8 Mr. Takashi nagai non-executive director
9 Mr. Narinder nath vohra non-executive & independent director
10 Mr. Pradeep dinodia non-executive & independent director
11 Gen.(retd.) Ved prakash malik non-executive & independent director
12 Mr. Analjit singh non-executive & independent director
13 Dr. Pritam singh non-executive & independent director
14 Ms. Shobhana bhartia non-executive & independent director
15 Mr. Sunil bharti mittal non-executive & independent director

Hero Moto Corp is the world no. 1 for the 5th year in a row
PROMINENT AWARDS TO THE COMPANY

25
Year Awards & recognitions
2008 Ndtv profit car india & bike india awards - bike manufacturer of the year
Overdrive magazine - bike manufacturer of the year
Tns voice of the customer awards:
No.1 executive motorcycle splendor nxg
No.1 standard motorcycle cd deluxe
No. Premium motorcycle cbz xtreme
2007 The ndtv profit car india & bike india awards 2007 in the following category:
Overall "bike of the year" - cbz x-treme
"bike of the year" - cbz x-treme (up to 150 cc category)
"bike technology of the year" - glamout pgm fi
"auto tech of the year" - glamout pgm fi by overdrive magazine
bike of the year" - cbz x-treme by overdrive magazine

ranked cbz x-treme " bike of the year" - by b s motoring magazine

most trusted company , by tns voice of the customer awards 2006.

Cd deluxe rated as "no 1 standard motorcycle" by tns voice of the customer awards
2006.
2006 Adjudged 7th top indian company by wallstreet journal asia (top indian two wheeler
company)

one of the 8 indian companies to enter the forbes top 200 list of worlds most reputed
companies.

No. 1 in automobile industry by tns corporate social responsibility award


Best in its class awards for each category by tns total customer satisfaction awards
2006:
Splendor plus (executive)
Cd deluxe (entry)
Pleasure (gearless scooters)
Splendor & passion - top two models in two wheeler category by et brand equity
survey 2006
Adjudged 7th top indian company by wallstreet journal asia (top indian two wheeler

26
company)
Top indian company in the automobile - two wheeler sector by dun & bradstreet -
american express corporate awards 2006
Hero Moto Corp splendor rated as india's most preferred two-wheeler brand at the
awaaz consumer awards 2006.
Certificate of export excellence for outstanding export performance during 2003-04
for two-wheeler & three- wheelers - complete (non ssi) by engineering export
promotion council
The ndtv profit car india & bike india awards 2006 in the following category:
Bike maker of the year
Bike of the year - achiever
Bike of the year - achiever (up to 150 cc category)
Bike of the year - glamour (up to 125 cc category)
Ndtv viewers' choice award to glamour in the bike category
2005 Awaaz consumer awards 2005 - india's most preferred two-wheeler brand by cnbc in
the 'automobiles' category
Bike maker of the year award by overdrive magazine
Icwai national award for excellence (second) in cost management 2004 in the private
sector category by icwai
10th motilal oswal wealth creator award for as the most consistent wealth creator for
the period 1991-2005
2004 Winner of the review 200 - asia's leading companies award (3rd rank amongst the top
10 indian companies)
Gvc level 1 (highest rating) by crisil for corporate governance
Adjudged as the best value creator - large size companies 2003-04 by the outlook
money
Corporate excellence award 2004 by indian institute of materials management
Adjudged as the organization with innovative hr practices by ht power jobs for hr
excellence
Icsi national award for excellence in corporate governance 2004 by the institute of
company secretaries of india
2003 Winner of the review 200 - asia 's leading companies award (3rd rank amongst the top
10 indian companies)
Most respected company in automobile sector by business world

27
Bike maker of the year by overdrive magazine
2002 Bike maker of the year by overdrive magazine
Winner of the review 200 - asia 's leading companies award (4th rank amongst the top
10 indian companies)
Company of the year of et awards for corporate excellence
Ranked 4th in 'overall best managed company' category, ranked 3rd in 'best financial
management' and 'best operational efficiency' category, ranked 6th in 'overall best
investor relations' category, by asiamoney
Highest wealth creating company of the year award by the money
Gvc level 1 (highest rating) by crisil for corporate governance
2001 Bike maker of the year by overdrive magazine
Winner of the review 200 - asia 's leading companies award (9th rank amongst the top
10 indian companies)
Winner of three leaves award for showing corporate environment responsibility in the
automobile sector by centre for science & environment
1999 National productivity award for the best productivity award in the category of
automobile & tractor presented by vice president of india
1995 The analyst award 1995 presented to Hero Moto Corp. On being ranked 9th amongst
the most investor rewarding companies in India
1995 National award for outstanding contribution to the development of Indian small scale
industry (nsic award - presented by president of India)
1991 Economic times-harvard business school award for corporate performance to
Hero Moto Corp.

KEY POLICIES :
AN ENVIRONMENTALLY AND SOCIALLY, AWARE COMPANY
At Hero Moto Corp, our goal is not only to sell you a bike, but also to help you every
step of the way in making your world a better place to live in. Besides its will to
provide a high-quality service to all of its customers, Hero Moto Corp takes a stand as
a socially responsible enterprise respectful of its environment and respectful of the
important issues.

28
Hero Moto Corp has been strongly committed not only to environmental conservation
programmes but also expresses the increasingly inseparable balance between the
economic concerns and the environmental and social issues faced by a business. A
business must not grow at the expense of mankind and man's future but rather must
serve mankind.
"we must do something for the community from whose land we generate our wealth."
A famous quote from our worthy chairman mr.brijmohan lall munjal.
ENVIRONMENT POLICY
WE at Hero Moto Corp are committed to demonstrate excellence in our environmental
performance on a continual basis, as an intrinsic element of our corporate philosophy.
TO ACHIEVE THIS WE COMMIT OURSELVES TO:
Integrate environmental attributes and cleaner production in all our business processes
and practices with specific consideration to substitution of hazardous chemicals, where
viable and strengthen the greening of supply chain.
Continue product innovations to improve environmental compatibility.
Comply with all applicable environmental legislation and also controlling our
environmental discharges through the principles of "alara" (as low as reasonably
achievable).
Institutionalise resource conservation, in particular, in the areas of oil, water, electrical
energy, paints and chemicals.
Enhance environmental awareness of our employees and dealers / vendors, while
promoting their involvement in ensuring sound environmental management.
QUALITY POLICY
Excellence in quality is the core value of Hero Moto Corp's philosophy. We are
committed at all levels to achieve high quality in whatever we do, particularly in our
products and services which will meet and exceed customer's growing aspirations
through: Innovation in products, processes and services. Continuous improvement in
our total quality management systems. Teamwork and responsibility.
MISSION STATEMENT IN PURSUIT OF EXCELLENCE
We, at Hero Moto Corp, are continuously striving for synergy between technology,
systems, and human resources to provide products and services that meet the quality,
performance, and price aspirations of our customers. While doing so, we maintain the
highest standards of ethics and societal responsibilities, constantly innovate products

29
and processes, and develop teams that keep the momentum going to take the company
to excellence in the new millennium".
WE CARE FOR ENVIRONMENT
A philosophy closest to Hero Moto Corp is that which pertains to the environment,
which is why the company goes that extra step to ensure that each one of the high
technology 4-stroke Hero Moto Corp motorcycles meet the most demanding of
pollution norms at every level. This is a policy that the company has followed since
the very beginning.
WE CARE FOR COMMUNITY
Hero Moto Corp is a company with a difference. Constantly involved in social
activities, spreading. Awareness about the community and environment, the company
has taken a giant step in the fields of Health care; Education; Engineering;
Environment and many more
International Marketing
Based on our own brand of globalization, they have built our distribution network
over 60 countries worldwide and multiplied our exports from 5 percent of
total turnover in Fiscal 2007-08 to over 15 percent in Fiscal 2010-11.
Motorcycles form the major chunk of the sales revenue of Hero Moto Corp. A small
proportion of the revenue comes from the sales of spares. The proportion of sales
revenue coming from each of these two segments in the FY10 is depicted in the graph
below:

MAIN OBJECTIVE OF COMPANY :


Through the company has wide list goals to be achieved but the major objective of the
company has to achieve areas follows:-
1. To provide right product to right people at right time.
2. Price should be reasonable; by this every level of person can afford the
product.
3. To maximize the share holders value by customer value enhancement.
4. Changes should be according to prospective customer
5. To provide delivery of standard product.
6. To provide value for money to there consumers.

30
CHAPTER 3
LITERATURE REVIEW

31
LITERATURE REVIEW
Marketing Strategy
A thorough understanding of the fast-changing Marketing Strategy, new market
segments and product opportunities along with sensitivity to changing customer needs,
form the core of Hero's marketing strategy and philosophy. At Hero we essentially have
a completely customer-driven approach. A nation-wide dealer network comprising of
over 3,500 bicycle dealers, 350 dealers for mopeds and 225 franchise holders for
motorcycles, ensures convenient access to the Group's products across the country.
With a deep sense of belonging to the Hero fraternity, the Group's dealer network has
catalyzed growth and acted as a strong bridge between the customers and the Group.
Conventionally, very few Indian bicycle manufacturers were interested in exports.
However, the Hero Group's foray into the overseas markets pioneered Indian exports in
the bicycle segment as early as 1963. It was a move prompted primarily by the need to
be attuned to the global marketplace.
While initial exports were restricted to Africa and the Middle East, today more than 50
percent of the Group's bicycle exports meet the demands of sophisticated markets in
Europe and America. This is primarily because of appropriate product development and
excellent quality that Hero offers.
The Group has undertaken a steady up gradation of technologies and there has been
diversifications and setting up of newer establishments to meet stringent international
standards. At the core of it all is a customer-centric scheme of policies and
production ... and the bottom line is to "Add Value while Engineering Satisfaction."
PARTNERSHIPS, ALLIANCES AND JOINT VENTURES
Hero's quest for a low-budget, fuel-efficient and environment-friendly two-wheeler
led Hero Moto Corp to enter into a Technical Collaboration with Steyr Daimler
Punch of Austria in 1987 for the manufacture of the 65cc, Porsche-design mini-
motorcycles.
Munjal Showa Limited was formed in Technical and Financial Collaboration with
Showa Corporation, Japan, to design, develop and manufacture of front forks,
shock absorbers, struts and gas struts.
Sunbeam Auto Limited has set-up a state of the art piston manufacturing facility in
technical collaboration with M/S Hero Foundry Company Limited of Japan, the
pioneers in the world for manufacturing high-strength lightweight pistons used in

32
light, powerful fuel-efficient engines Munjal Auto Industries Limited has a joint
venture with the State-owned Gujarat Industrial Investment Corporation, to cater
to the needs of the overseas market.
Hero Cycles CR Division was set up in consultation with MECON, Asia's largest
engineering consultants and in Technical Collaboration with Wean United, USA.
Hero Cycles Cold Rolling Division has also entered into a technical collaboration
with Kawasaki Steel Corporation, Japan for the improvement of production yield,
elimination of defects, reduction of customer returns and enhancement of
maintenance operations against certain predetermined targets.
QUALITY
Quality at Hero is attained not just by modern plants and equipment and through latest
technology, but by enforcing a strict discipline. At the Group factories, attaining quality
standards is an everyday practice - a strictly pursued discipline. It comes from an
amalgamation of the latest technology with deep-rooted experience derived from
nearly four decades of hard labor.
It is an attitude that masters the challenge of growth and change - change in consumers'
perceptions about products and new aspirations arising from a new generation of
buyers. Conformance to quality at Hero begins on the shop floor. Every worker ensures
at each stage of manufacturing that any of the faulty products are not allowed to go
through further manufacturing and distribution cycles.
Today quality is ensured from steel processing to the finished product. Each component
goes through numerous tests at the stages of design, raw material procurement and, of
course, during the manufacturing process.
Constant technology up gradation ensures that the Group stays in the global
mainstream and maintains its competitive edge. With each of its foreign collaborations,
the Group goes onto strengthen its quality measures as per the book. The Group also
employs the services of independent experts from around the world to assist in new
design and production processes.
Nevertheless, in this race to acquire the most modern techniques and technologies and
to collaborate with the most advanced players in the market, the core competence
continues to be derived from the Group's philosophy - "To Engineer Satisfaction."

33
MARKETING MIX STRATEGY
Product Mix

Product Variety Quality Design Brand Name Warranties Service Features

Price Mix

List Price Discount Allowances Payments Periods


Credit Terms
Place Mix

Channels Coverage Assortments Inventory Transport

Promotion Mix

Sales Promotion Advertising Public Relations Direct Marketing

34
MARKETING MIX: -

Standardised Marketing Mix:


An international marketing strategy for using basically the same product, advertising,
distribution channels & other elements of the marketing mix in all the countries of
companys international market.
Adapted Marketing Mix:
An international marketing strategy for adjusting the marketing mix elements to each
international target market, bearing more costs but hoping for a larger market share &
return.
International Scenario
A two-wheeler is used as a personal/family vehicle or a goods carrier in the enveloping
countries, whereas it is confined to sports/racing (heavy motorcycles) or short istance
shopping (mopeds) in developed countries.
The world two-wheeler market is dominated by Japan. Japanese manufacturers
account for around 65% of the total two-wheeler production in the world. However,
production within Japan has been declining due to lower domestic demand and shift
in manufacturing base outside the country. Japan is also the world's largest exporter of
two-wheelers in the world controlling around 75% of the world trade. Its major
markets are China, USA and Europe. In terms of player positions, Hero Moto Corp
Corporation, Yamaha Motors and Suzuki Motors Corporation share the top three slots
in the world two-wheeler market. The table below shows the production and sales
figures of motorcycles and scooters in Japan during the past decade More than 50% of
the production in Japan is exported out of the country. This scenario contrasts directly
with the Indian scenario. In India, only about 15% of the production in FY11 were
exported
The Asian continent is the largest user of two-wheelers in the world. This is due to
poor road infrastructure and low per capita income, restrictive policy on car industry.
The technology for two-wheelers is not as well developed as for car industry. This is
due to oligopoly between top five players in the segment, compared to thirty
manufacturers in the car industry.

35
EXPORTS

HERO CYCLES

HERO MOTO CORP

HERO PUCH
HERO CORPORATE SERVICES (Herosoft, Hero
Mindmine, Hero serveIT)
MUNJAL SHOWA LIMITED

36
PLACEMENT OF HERO MOTO CORP
Hero Moto Corp Limited sells the motorcycle through a widely spread all India networks of
over 450 of dealers. The motorcycle can be serviced at the authorized dealers or SSPs
(Spare and Service points).
In the year 1996, Hero Moto Corp was the first company to introduce Indias first chain of
automated services workshops. To expand the service network further to smaller towns, the
company has appointed Service extensions.
Hero Moto Corp genuine spare parts are available from the dealers, SSPs and the stockiest.
The company provides good after sales service through its well-established dealer network.
The company has a policy of three S, Single S for stockiest, Double S for services and three
SSS for sales.
The company is having about 460 of SSS, which deals in Sales, Service, and Stock, 260 of
SS, which deals in Service and Stock and 12 of S, which exclusively deals in stocks.
The Network As On 31st March 2002 Is As Under: Dealers (3s_-Sales, Service, Spares)-
458, Ssps (2 S-Service And Spares)-256, Stockiest (Single S-Spares)-12
The company has developed a unique distribution network, which has given it a distinctive
competitive advantage. The whole idea behind establishing this vast distribution network is
to reach the customer even in the remote areas.
The company has segregated the areas as Urban, Rural, and semi rural and has appointed
dealers in many of these areas, after seeing the potential. The companys major thrust is the
easy availability of all the models in every part of the country.
The companys bikes are sold through the dealers and they are required to provide proper
infrastructure, Workshops, Facilities, and trained Personals. The dealers are given targets
and they are required to sell sufficient number of vehicles to earn a return on investments.
Regional offices are in constant touch with these dealers.
Presently the company is having 8 regional offices in the country. The regional offices
constantly assist these offices as a kind of linkage between the company and the dealer and
the dealers. The sales and the marketing personals at the regional offices are trained and
encourage maintaining a cordial relationship with various dealers on the basis of trust and
understanding. The companys service engineer and the other sales staff supervise all the
facilities at the dealer and the service outlet from planning the layout to the errection of the
specially designed benches and the tools. Infact all the possible efforts are made by the
company to make the dealers to become the part of the Hero family and its culture.

37
The company has appointed fleet of more than 400 trucks from around 45 transporters to
assist them in the delivery of vehicle. From the factory and within the factory premises, the
company has a good fleet of trucks and trailers. The company to deliver the vehicle to the
dealers showroom in the gactory fresh condition uses these trucks and trailers. The cargos
are loaded in the trucks and the trailers and they are delivered at the stockyards of the
dealers in whichever part of the country they may be located. So the company in this way
delivers the motorbikes in the fresh factory conditions. By the time the bike reaches our
dealers they might have done hardly a coupler of kilometers. The company believes the
marketing efforts should go beyond ensuring product availability.
The focus is therefore on a vast distribution network. In order to ensure the customers a
better quality service at the various stations, the company mounts an effective training
porograme in which all the mechanic, supervisory staff and the other senior staff personnel
participate.
The company is also planning to set up some of the fully equipped express authorized
highway. In these highways, one would see a Hero Moto Corp dealer every 15-25
KMS.This concept is thought by the company with a view to provide good after sales
services to the customer. This exercise will also check the company to check the use of
spurious products, which ultimately spoil the bike. The highways to be covered in this
scheme are:
NEW DELHI-GWALIOR
NEW DELHI-CHANDIGARH
AMBALA-LUDHIANA
KOLKATTA-DHANBAD
The company has a dream to increase this figure of 458 dealers to 650 by the end of 2003
and increase the figure of 256 service stations to 350 by the end of the year 2003.The
company is going by an expansion process.
The company is perhaps the second company after Maruti Udyog Limited to implement a
factory fresh concept. The company is the only company in the two-wheeler segment
having so much of vast distribution network. Hero Moto Corp will be adding 25 more
dealers and 50service stations to build a network of 575 dealership-cum-service points
(including 400 dealerships) across the country.
The level of investment in an automated Hero Moto Corp service station is expected to be
around Rs 10 lakh, apart from land and building. ``No dealer has any problem in expanding

38
business,'' says Tapan, Marketing manager. ``We've tied up with Citibank and Centurion to
provide bill discounting through our dealers. Consumer Finance: In order to focus on
organized consumer financing, Hero Moto Corp tied up with Tata Finance a week ago. This
is Hero Moto Corp's second tie-up following Centurion, which is accounting for around
3,000 bikes a month through 100 dealerships.
A thorough understanding of the fast-changing consumer behaviour, new market segments
and product opportunities along with sensitivity to changing customer needs, form the core
of Hero's marketing strategy and philosophy. At Hero we essentially have a completely
customer-driven approach. A nation-wide dealer network comprising of over 3,500 bicycle
dealers, 350 dealers for mopeds and 225 franchise holders for motorcycles, ensures
convenient access to the Group's products across the country.
With a deep sense of belonging to the Hero fraternity, the Group's dealer network has
catalysed growth and acted as a strong bridge between the customers and the Group.
Conventionally, very few Indian bicycle manufacturers were interested in exports.
However, the Hero Group's foray into the overseas markets pioneered Indian exports in the
bicycle segment as early as 1963. It was a move prompted primarily by the need to be
attuned to the global marketplace.
While initial exports were restricted to Africa and the Middle East, today more than 50
percent of the Group's bicycle exports meet the demands of sophisticated markets in Europe
and America. This is primarily because of appropriate product development and excellent
quality that Hero offers. The Group has undertaken a steady upgradation of technologies
and there has been diversifications and setting up of newer establishments to meet stringent
international standards. At the core of it all is a customer-centric scheme of policies and
production and the bottom line is to "Add Value while Engineering Satisfaction.

39
PRODUCT STRATEGIES OF HERO MOTO CORP
Hero Hero shifted its focus from catering to the fuel efficient conscious consumer to try
and occupy other segments of the motorbike market and therefore the new product
launches from Hero Moto Corp in the last three year have been in this direction. The
company has also upgraded some of its bikes to stay in contention and to meet Euro
emission norms. The new underlining theme for the company One for everyone has led
to the launching of new products, which are as follows:
Street Smart: Hero Moto Corp introduced its Street Smart in 1997. The company who
were more inclined towards the scooters and who thought that the scooters were more safer
than the motorcycles, thus Hero Moto Corp decided to launch the Street Smart. The bike
was built in such a way that it resembled more like a scooters, than a motorcycle, but
actually it is a motorbike. I.e. it is a hybrid
Product Description (HERO MOTO CORP Ltd.)
Hero Moto Corp has launched the following motorbikes in the Indian market.
HERO MOTO CORP CD 100
HERO MOTO CORP CD 100 SS
HERO SLEEK
HERO MOTO CORP Splendor
HERO MOTO CORP Street Smart
HERO MOTO CORP CBZ
HERO MOTO CORP Joy
HERO MOTO CORP Passion
HERO MOTO CORP Ambition
Hero Hero shifted its focus from catering to the fuel efficient conscious
consumer to try and occupy other segments of the motorbike market and therefore the
new product launches from Hero Moto Corp in the last three year have been in this
direction. The company has also upgraded some of its bikes to stay in contention and
to meet Euro emission norms. The new underlining theme for the company One for
everyone has led to the launching of new products With the launch of new
motorbikes and various other motorbikes in the pipeline, Hero Moto Corps strategy is
to get into these segments of the motorcycle market where they have not made in
roads earlier.

40
PRICING STRATEGIES OF HERO MOTO CORP
The company has a policy to price its product very competitively. In todays world,
one cannot has a skimming pricing says Mr. Tapan, marketing manager, Hero Moto
Corp. Necessarily the pricing policy is completely a blend of two strategies i.e.
Penetration and Skimming. It has been the companys policy to provide the customers
with value for money-give more for less. We are the only company in the two wheeler
segment that is in the process of passing on the whole benefit of cost advantage
achieved as a result of the increased localization levels of upto 60% to the customers.
We are in the process of keeping our product increasing popular and affordable. The
company keeps telling its customers to think about Quality rather than price. Further
if one talks about the changes in the price in the last three years, the prices have never
been changed except the budgets except once in APRIL 2011,when the company
started off with their celebration offer, and thus decided to sanctioned a discount
and curtail on every Model Rs 1001\-. The company is surely in a business of
delivering quality rather than price. For instance the Boxer, which is of only 29,990
and is the cheapest bike of the industry. The company gives importance to the quality
rather than cheap products.
Well Hero Moto Corp has bikes at different price point but there is one common
thing that is they are priced at a premium of INR 2000- 3000 from the competitors
and it seems their strategy is working fine with the target customers as it is the largest
seller of bikes in the Indian market with a market share of 48 % .Customers are redy
to shell out the extra money because they believe and its fact that the fuel efficiency
of the bikes is much better than its competitors the different price points for Hero
Motors Limited are :
NAME PRICE
Dawn ------------------- 32,000
Splendor --------------- 41,000
Passion ---------------- 44,000
Cbz--------------------- 52,000-60,000
Thus we find that HML has bikes for every one for entry level customers they have
dawn which is a no frill attached product whose emphasis is on mileage with
performance .And for customers who like to have bike which is good at performance
and with descent looks they have Splendor which is their fastest selling bike and

41
account for half of the total sales. Customers who are looking for style with
performance can go for Passion which is a huge success among the urban class as it is
priced little bit higher than splendor and the looks of the bike are astounding. For
customers who want style and power they have CBZ which is targeted towards the
premium segment and it was a runaway success initially but is not a hot seller now
due to some problems. Hero Moto Corp is planning to introduce few more models in
years time in order to make their portfolio of products more versatile. They are trying
to introduce new models and they are trying to introduce models at the premium
segment as it has high margins and the company feels that its the segment which is
will grow in the near future as the income of people will increase with the change of
life styles .HML also intend to introduce few models which are economical in nature
as they this segment provides the volumes to the company. Hero Moto Corp still
wants to charge a price of premium as its brand enjoys a high level of respectability
and reliability among the target customers as their products have already proved their
mettle in the market and enjoy high level of brand equity among the target customers.
Hero Moto Corp has an advantage of large no of dealers and also economies of scale
which help them to absorb the costs to a great extent.

42
PROMOTIONAL STRATEGIES OF HERO MOTO CORP
Hero Moto Corp rides safe
Hero Moto Corp's `Ride Safe and Good Rider' campaign is aimed at communicating
the philosophy of delivering safe products and promoting good driving for the overall
safety of the Hero Moto Corp customer. Created by McCann Erickson, the ad-- Hero
Moto Corp cares for your safety--invited all Hero Moto Corp owners to attend the
Ride Safe programme on October 27, 2011 at Delhi's India Gate lawns. This was the
first phase of the programme, where three instructors from Japan demonstrated
techniques of right driving. In the second phase, Hero Moto Corp will communicate
the launch of the 4S concept (sales, service, spare parts and safety) at Hero Moto Corp
dealerships. The focus of the third phase will be to promote the launch of the Hero
Moto Corp Safety Riding Promotion School, which will have riding simulators and
safety riding tracks
Hero Hero will take the riding programme-- where trained personnel will give riding
tips to bike owners-- to over 100 dealerships across 90 towns.
Promotion in this sector cannot be like that in the Fast Moving Auto pats
(Automobile) sector. The promotions in this sector are like 0% finance schemes and
other sort of things. The company takes the services of many good and reputed
advertising agencies like Reddifuusion, Lintas, sachi & Sachi and others.
The company has also signed a kind of agreement with two celebrities just now to be
their brand ambassadors. Hero Moto Corp, a leading manufacturer of motorcycles,
has roped in film actor Hrithik Roshan and captain of Indian Cricket team Sourav
Ganguly as its brand ambassadors for three years till 2003.
They would endorse the company products, attend corporate and brand events and
help promote its "we care" campaign comprising safety riding, environment, and
friendliness.
Hrithik and Ganguly said they were glad to be associated with Hero Moto Corp. Hero
has embarked upon an ambitious project to achieve sale of one million bikes this year
with a market share of 47 per cent. The turnover would be in excess of Rs. 3000 crore.
In October alone, 1,12,000 motorcycles have been sold, Compared to 66,063 units in
the corresponding period last year, the increase in sales is a phenomenal 69 per cent.
Cumulative sales jumped up by 41.58 per cent to 5.72 lakhs units during April-
October as against 4.04 lakh units in the same period last year.

43
At Hero Moto Corp , our goal is not only to sell the customer a bike, but also to help
him at every step of the way in making the correct riding decisions. Assisting him in
making the right judgments on the road, and helping him to choose the right helmet
and other riding equipment
And as bike handling requires know-how, skill, and rigorous mental conditioning, we
have put together certain safety tips and suggestions that will enhance the riding
comfort. Last but not the least, it is always important to remember - a good rider is a
safe rider.
Hero Moto Corp is enhancing the Advertising &Promotion budget by around 35 per
cent from Rs 41 crore in 1999-2000. Apart from concentrating on mainstream
Splendor-- the world's largest selling bike-- and upscale CBZ motorcycles, Hero Moto
Corp has identified ``soft areas'' like services and spares parts for the purpose of
intense communication. The creative account of Hero Moto Corp rest with big names
like Hindustan Thompson Association, Lintas, Sachi and Sachi and so on. Hero Moto
Corp is also planning a major campaign to re-launch the restyled step-thru Street
Smart. While customer references-- and not media strategy-- are expected to support
the CD brand sales, Hero Moto Corp will look at social areas -- like civic issues,
association with Non Government Organizations, contribution to greener causes-- for
corporate communications.
The corporate campaign will be largely complemented by on-ground initiatives under
the umbrella brand of ``We Care'', incorporating activities in the arena of community
services, safety and services programmes, tree-plantations and environmental-friendly
projects.
In line with Hero's worldwide, safety riding programme, this fiscal Hero Moto Corp
Motors Limited will take the riding programme-- where trained personnel will give
riding tips to bike owners

SPORTS & ENTERTAINMENT


In sports promotions, Hero Moto Corp will stickto cricket (following title
sponsorship of the World Cup last year, it has signed a three-year contract for Hero-
Hero-Salve Challenger Trophy) andgolf (it will continue with Hero-Hero Masters
Golf).
Moreover, after a successful association with movies-- last year it signed Pyar Mein
Kabhi Kabhi starring Dino M and Twinkle-- Hero Moto Corp is in theprocess of

44
identifying title sponsorships of youth-centric movies. Says Sobti, In terms of media
exposure, we are looking at sports, moviesand news. Niche channels are also worth
putting your money on.'' For theCBZ, this year it is planning to run commercials in
youth channels like MTV;Discovery and Star Movies.
In sports promotions, Hero Moto Corp will stick to cricket, it has signed a three-year
contract for Hero-Hero-Salve Challenger Trophy) and golf (it will continue with
Hero-Hero Masters Golf). Moreover, after a successful association with movies-- last
year it signed Pyar Mein Kabhi Kabhi starring Dino M and Twinkle-- Hero Moto
Corp is in the process of identifying title sponsorships of youth-centric movies. In
terms of media exposure, the company is looking at sports, movies, and news. For the
CBZ Motorcycle, this year it is planning to run commercials in youth channels like
MTV; Discovery and Star Movies.
The Target: Services will be a major differentiator,'' says Sobti.``The campaigns will
highlight the high level of services and automatedfacilities at our dealerships.'' Hero
Moto Corp is expecting a 30-35 per centgrowth in spare parts revenue, which
accounted for Rs 100 crore in 1999-2000.In the new fiscal, Hero Moto Corp is aiming
to take the sales of Splendor from40,000 a month to 50,000 a month; CBZ from 4,500
a month to 5,000; and a10-15 per cent growth in CD and CD-SS brands up from
25,000 a month now. There-launched step-thru Street Smart is expected to account for
around25,000-30,000 in the first year.
Services will be and is the differentiator. The campaigns will highlight the high level
of services and automated facilities at the companys dealerships. Hero Moto Corp is
expecting a 30-35 per cent growth in spare parts revenue, which accounted for Rs 100
crore in 1999-2000.In the new fiscal, Hero Moto Corp is aiming to take the sales of
Splendor from40, 000 a month to 50,000 a month; CBZ from 4,500 a month to 5,000;
and 10-15 per cent growth in CD 100 and CD100-SS brands up from 25,000 a month
now. Supporting all of the Hero Moto Corp's growth projections are amulet-pronged
strategy including a thrust on a customer relationship programme, major increase in
advertising and promotion (A&P) spending, expansion of dealership network, and a
focus on organized consumer financing.
DEALERSHIP EXPANSION
Hero Moto Corp will add 25 more dealers and 50service stations to build a network
of 575 dealership-cum-service points(including 400 dealerships) across the country.

45
The level of investment in an automated Hero Moto Corp service station isexpected
to be around Rs 10 lakh, apart from land and building. No dealerhas any problem in
expanding business,'' says Sobti. We've tied up withCitibank and Centurion to
provide bill discounting through our dealers.''Consumer Finance: In order to focus on
organised consumer financing, HeroHero tied up with Tata Finance a week ago. This
is Hero Moto Corp's secondtie-up following Centurion, which is accounting for
around 3,000 bikes a month through 100 dealerships.
We've got a good internal rate (based on IRM), which is standard acrossthe country,''
says Sobti. ``These finance companies bring refreshinglycustomer-friendly focus to
our organisation.''
With Tata Finance, Hero-Hero's reach will be extended to over 150dealerships.
Also, Tata Finance is expected to add 2,000 bikes a month. Presently, consume
financing, including non-organised financing, contributes around 20,000 Hero Moto
Corp bikes a month. Gauging Consumer: Hero Moto Corp is chalking out a customer
relationship programme, which is expected to be established in the next three years.
We're discussing with Result McCann,'' says Sobti.
The programme will initially attempt at building relationships with Hero Moto Corp's
top three to five lakh owners, out of its customer base of three million.

46
SALES PROMOTIONS
Hero Moto Corp regularly has promotions running for its dealers as well as customers
in order to ensure that there is a interest among the target customers abut the company
and its products. Normally Company participates in road shows, Sponsors college
festivals, promotes eco friendly initiatives, Have festive Season offers, and sometimes
price discounts to attract the attention of the people. These promotions are targeted
mainly on youngsters as they are the primary buyers of bikes.
The company launches financial schemes as Zero % finance schemes in collaboration
with different banks so that customers can pick bikes in easy installments. The effect
of these promotions can be understood from the fact that 35 % of bikes are sold
through this medium.
INTRODUCTION OF MARKET RESEACH
Marketing is a restless, changing dynamic field, since 1920 many important and
dramatic changes have taken place in marketing. Thousands of new products,
including those of entire new industries such as automobiles, electronic and
computers, textiles, footwear etc. have appeared on the market.
Though al these occur through a gradual procedure of change but pronounced shift in
the orientation of times from production to marketing moreover, the role of marketing
itself has been changing. The various crises of the 1970s material and energy
shortage, inflation, economic stagnation, high unemployment, dying industries have
forced the marketing executives to assume a wide range of responsibilities that have
grown in complexities.
Due to the many challenges offered by the environment, the companies executives are
becoming more driven in their strategy decision making for making sound marketing
decisions in response to this requirement of formalized means of acquiring many
ways has reached a stage of maturity i.e, marketing research.
Market research has become a great tool for these companies to get the feedback and
formulate strategies accordingly in todays eager to know. What consumer perceives
about various brands for the perfect selection of target market. In an era where
competitive pressures have make the cost of failure prohibitive, research has become
crucial in getting the market plan right. As the project was globalization of Hero
Moto Corp I found that the company is making its marketing mix strategies by
considering the consumer at the central point because, now a days, the consumer has
become more aware and is no more a novice. Thats why marketing research has

47
become an important tool in the hand of marketer to understand the versatile nature of
ever changing consumer behavior as depicted by the marketing research, as refined by
American Marketing Association.
Is the function which links the consumer, customer and public to the marketer
through the information used to identify and refined marketing opportunities and
problems, generate, refine and evaluate marketing actions: monitor marketing
performance and improve understanding of marketing as a process.
Marketing research specifies the information required to address these issues designs
the method for collecting information managers and implements the data collection
process, analysis the results and communicates the finding and their implications.
ADVERTISING
The advertising includes both print and television media. The company uses the
services of Lintas, Sachi, and Sachi but Hindustan Thompson Association deals main
of the advertising. Besides of giving the commercial advertising the company also
releases the advertisement, which are of public interest and especially the company
releases the social advertising as to how to go about the safe driving. The company
keeps on sponsoring different Programes and various kinds of games like the
company every year sponsors Golf Championship. c The company has also recently
decided to increase their adverting budget for the current year as they have to release
more advertisements in public interest and the company has to re-launch the Street
Smart model once again which was a tremendous failure in the early stager of its
launch.
Sale Promotion-The company does sale promotion for both dealers and the customers.
The company is currently offering the promotion to their customers as they are
offering a discount of 1001.This discount is the company sanctioned discount and the
dealers may also offer some kind of discount due to competition to attract customers
and to increase the sale figures. The company also offers a kind of promotion to the
dealers; The Company is having a slab system as a tool for promotion to the dealer.
Advertising & Promotion:
Hero Moto Corp is enhancing the A&P budget by around 35 per cent from Rs 41
crore in 2010-2011. Apart from concentrating on mainstream Splendor-- the world's
largest selling bike-- and upscale CBZ motorcycles, Hero Moto Corp has identified
``soft areas'' like services and spares parts for the purpose of intense communication.

48
While customer references-- and not media strategy-- are expected to support the CD
brand sales, Hero Moto Corp will look at social areas -- like civic issues, association
with NGOs, contribution to greener causes-- for corporate communications.
The corporate campaign will be largely complemented by on-ground initiatives under
the umbrella brand of ``We Care'', incorporating activities in the arena of community
services, safety and services programmes, tree-plantations and environmental-friendly
projects.
In line with Hero's worldwide, safety riding programme, this fiscal Hero Moto Corp
will take the riding programme-- where trained personnel will give riding tips to bike
owners-- to over 100 dealerships across 90 towns.
PERSONAL SELLING-
As a part of sales promotion, the company also does personal selling to the corporate
sector. This is done in case of institutional selling. In the beginning only the CSD
canteens were included but now even Multi National Companies also form a part of
the institutional selling
Heros corporate week-The week in December 2001 was observed as the corporate
week. This week was observed in the year 201 to spread awareness among the
corporate employees about the company and its range of products. In this week
various vendors participated as well as various dealers participated. This platform was
also used as making and building more cordial relations among the employees and the
dealers.
CHANNEL OF DISTRIBUTION IN HERO MOTO CORP
Hero Moto Corp continues to have the same policy of directly approaching the
dealers. However the company has made some changes in the dealership
requirements. The company has now divided its into three categories, A, B and C
depending upon the status of the town. Hero Moto Corp has made some regulations
and its dealers are bound to fulfil specific requirements for their showroom and
workshops in terms of area. The company has also started focusing on the rural
marketing such as Agartala (Tripura), Tinsukia (Assam) and Bhagalpur (Bihar). The
company has also increased the number of dealers from 350to 400.
Distribution Channels-
Hero Moto Corp has very strong Distribution channel in India. Hero Moto Corp
distributions their through Regional officer, Authorized dealers Etc.

49
HERO MOTO CORP IN INDIAN HAS 3500 AUTHORISED DEALER
Criteria for selection of distributions;
Financial position to the distributors
Goodwill
Situation of show room
Past record
Experience
Promotion
a) Sale locating customers
Hero Moto Corp regularly has promotions running for its dealers as well as
customers in order to ensure that there is a interest among the target customers abut
the company and its products. Normally Company participates in road shows,
Sponsors college festivals , promotes eco friendly initiatives ,Have festive Season
offers , and sometimes price discounts to attract the attention of the people . These
promotions are targeted mainly on youngsters as they are the primary buyers of bikes.
The company launches financial schemes as Zero % finance schemes in collaboration
with different banks so that customers can pick bikes in easy installments . The effect
of these promotions can be understood from the fact that 35 % of bikes are sold
through this medium.
b) Qualifying customers
"We are happy with our financial performance. It gives immense joy to see this kind
of results in the 25th year of our company. I wish to thank all our stakeholders
customers, associates, dealer friends, ancillaries and also our joint venture partners
Hero Moto Corp Co for their continuous support."
Sales Performance
Hero Moto Corp reports leadership performance with 50 % net profit in q2, 10-11
defies industry trend with turnover (net sales & other operating income), at rs. 3202
crore; ebidta at 13.58 per cent
Aug09 Aug 10 fy 09-10 fy 10-11
Total turnover (Net sales & Other Operating income)Rs 3202 crores, growth of
35.6 per cent
Net profit after tax at Rs 306.30 crores, growth of 50 per cent
EBIDTA margin for the quarter 13.58 per cent

50
Total sales for Q2 stands at 9,72,095 units, growth of 28.5 per cent
Total sales for H1 stands at 18,66,349, growth of 19.7 per cent
Over 55 per cent share in domestic motorcycle market
Launches first-of-its kind music video to celebrate 25 years of Hero Moto Corp
New Delhi, October 21, 2008: Hero Moto Corp (HML), the world's largest two-
wheeler company for seven consecutive years, today firmly reiterated its undisputed
leadership in the domestic two-wheeler market with impressive bottom line growth
for the second quarter (Q2) July to September - of this financial year (FY) 2008-
09.
Even as the industry continued to face tough market conditions on account of
uncertainty over interest rates and overall credit squeeze, the company reported 50
per cent growth in profit after tax (PAT) at Rs 306.30 crore for the second quarter.
Hero Moto Corp's profit after tax in the corresponding period last fiscal (July - Sept,
2010-11) stood at Rs 204.33 crore.
Total turnover (Net sales & Other Operating income) grew to Rs 3202 crore, a
growth of 35.6 per cent over Rs 2361 crore recorded in the corresponding period
last fiscal. The company has recorded an EBIDTA margin of 13.58 per cent in the
quarter. The EBIDTA margin in the previous quarter (April - June '08) was 12.20
per cent.
The strong financial performance is in line with the company's better-than-industry
top line growth. After posting a growth 11.38 per cent in the first quarter, the
company kicked off the second quarter with a 39.8 per cent growth in sales in the
month of July, and followed up with 26.8 per cent growth in August and 22.4 per
cent in September. Hero Moto Corp consistently keeps growing its share in the
domestic motorcycle market, and currently enjoys over 55 per cent share.
Hero Moto Corp's cumulative sales for the second quarter (Q2) this FY stands at
9,72,095 units - a growth of 28.5 per cent over Q2 last FY (2009-10). The
cumulative sales for the first six months (H1) stands at 18, 66,339 units of two-
wheelers compared to 15, 59,486 units sold in H1 in the last FY reflecting a
consistent 19.7 per cent growth in cumulative sales.
Dr. Brij Mohan Lall, Chairman, Hero Moto Corp, said "We are happy with our
financial performance. It gives immense joy to see this kind of results in the 25th
year of our company. I wish to thank all our stakeholders customers, associates,

51
dealer friends, ancillaries and also our joint venture partners Hero Moto Corp Co
for their continuous support."
Mr. Pawan Munjal, MD & CEO, Hero Moto Corp., said "Our numbers speak for
themselves. Even in this volatile and competitive environment, our top line
continues to outpace the industry growth, our market share is at an all time high, and
the financial balance sheet is a delight all the factors which form the hallmark of a
resilient company with cutting-edge management. We will continue to keep
innovating in bringing in technologically-superior products, in our network
expansion, in brand building, in our financial management, and in our
communication."
"Going forward, we will have to keep a close watch on the commodity prices
movement, and other factors such as inflation, interest rate scenario and availability
of retail finance. These factors will play a crucial role in the industry growth in the
subsequent quarters," he added.
Hero Moto Corp has already rolled out its festive season initiatives, with the launch
of four new models the all-new "Passion Pro" and three refreshes of its existing
models - new CBZ X-treme, a selfstart version of Splendor NXG and the refreshed
Pleasure. During the coming months, the company will further augment its product
portfolio with new launches across segments.
Key Hero Moto Corp brands continue to drive strong volumes across segments -
CD Deluxe in entry segment, Glamour, the new Splendor NXG, Splendor + and
Passion Plus in deluxe segment, and Hunk, CBZ X-treme and Karizma in the
premium segment.
Celebrating its 25th year, Hero Moto Corp released an innovative music video in
the month of September. Titled " Hero Moto Corp Dhak Dhak Go", and involving
as many as eight brand ambassadors of Hero Moto Corp, the music video has been
receiving rave reviews.
Hero Moto Corp recently won two very coveted awards - "The Most preferred
Brand of two-wheelers" award at the recent CNBC Awaaz Consumer Awards 2010,
and the "NDTV Profit Business Leadership Award".
Hero Moto Corp closes calendar year 2007 with sales of over 33 lakh bikes
Hero Moto Corp consolidates market leadership with impressive growth of 15% in
March10

52
Hero Moto Corp Continues Growth Momentum With 9.5 Per Cent Increase in May
Sales
Hero Moto Corp Continues To Consolidate Market Leadership With 27 Per Cent
Growth In August Sales
Hero Moto Corp Net Profit Zooms 31% To Rs 275 Crore In Q3 (Fy 2010-11)
Hero Moto Corp passes on excise duty cut benefit to customers
Hero Moto Corp posts record 6 lakh-plus units in retail sales in October 2010
Hero Moto Corps positive performance continues in Nov 10
Hero Moto Corps September 08 sales jump 22 per cent
Hero Moto Corps strong sales performance continues into 2010
Reports 13% growth in cumulative sales in apr-nov2010
Hero Moto Corp closes calendar year 2007 with sales of over 33 lakh bikes
New Delhi, Tuesday, April 21, 2010: Recap of year 2008
Slew of launches across various segments this calendar year
Multi-focal strategy leading to better-than-industry performance and gain in
market share
Doubled volume and share in the premium segment
Consolidated over 50 per cent share in domestic motorcycle market
New Delhi, January 2, 2011: Hero Moto Corp (HML), the worlds largest two-
wheeler manufacturer, today reported cumulative sales of 33, 09,051 units of two-
wheelers for the period JanuaryDecember 2010. The companys cumulative sales
for the calendar year 2009 was 32, 53,229. This achievement is significant in view
of the prevailing slow down of the two wheeler industry.
For the month of December 2007, HML reported sales of 240,532 units of two-
wheelers. The companys sales for the corresponding period last year were 252,462
units.
The better than industry performance of HML through 2010 has been possible due
to the companys multi-focal strategy of bringing in new products across segments,
supporting them with extensive 360 degrees communication, leveraging properties
such as cricket and entertainment for brand building and augmenting its distribution
network. As a result, Hero Moto Corps share in the domestic motorcycle market
has grown to upward of 50 per cent.
Year 2007 saw Hero Moto Corp launch new models across segments. The company
more than doubled its volume and share in the premium segment this year, with the

53
new all-muscle and macho Hunk, and the sporty and stylish CBZ X-treme both
doing very well.
New 100cc bike Splendor NXG, refreshed Pleasure, new Super Splendor, refreshed
Passion Plus, were other additions to Hero Moto Corps product portfolio in 2010.
The company crossed the twenty million cumulative sales mark this year and
launched the special edition Splendor Plus to mark the occasion. In the month of
December, continuing with its engagement with youth, Hero Moto Corp brought
the legendary rock band Scorpions to India, for performances in Mumbai and
Bangalore as part of the bands Humanity World Tour 2009-10. This came close
on the hills of the very popular Hero Moto Corp Campus Rock Idols, a nationwide
contest of amateur rock bands that culminated into a grand finale in Delhi in the first
week of December.
Hero Moto Corp consolidates market leadership with impressive growth of 15% in
March08
For fy 2009-10, Hero Moto Corp overtakes previous fiscals sales tally, even as
domestic motorcycle industry declines by more than 10 %
New Delhi, Tuesday, April 21, 2010: Achievements and Highlights for FY 0-08
o Defying the industry trend, Hero Moto Corp achieved sales of 33,37,142 units of
two-wheelers, thereby consolidating leadership in domestic motorcycles market
with more than 52 per cent market share.
o Hero Moto Corp retained the coveted position of 'World's No 1 two-wheeler
company' on unit sales by a single company during calendar year 2007 for the
seventh year in a row.
o Crossed half a million retail sales in the festive season in 2009, and achieved
landmark cumulative sales of twenty million bikes in course of 2009.
New Delhi, March 31, 2010: Hero Moto Corp (HML), the worlds largest two-
wheeler manufacturer, further consolidated its undisputed market leadership,
reporting impressive sales numbers for the month of March. Once again, defying the
industry trend, the company sold 3,20,594 units of two-wheelers in the month, a
growth of 15 per cent. Hero Moto Corp had sold 277,915 units of two-wheelers in
March 2011.
The companys total sales for the financial year 2009-10 stand at 33,37,142 two-
wheelers, as compared to 33,36,756 units for the previous financial year (2007-08).

54
This is significant in view of the severe slowdown that the domestic two-wheeler
industry is going through for the past more than a year.
Mr. Pawan Munjal, Managing Director, Hero Moto Corp said, The year 2009-10
has seen a leadership performance from us. Despite the industry slowdown, we have
been able to manage positive growth thereby taking our share in the domestic
motorcycle market upward of 52 per cent. At the end of the financial year, I would
definitely like to thank our millions of customers across the country, who have made
it possible. We will continue to focus on our customers and they can surely look
forward to many more launches and various initiatives in the coming year.
HMLs good run through the industry slump in 2007 has been possible due to the
companys multi-focal strategy of bringing in new models and variants across
segments, supporting them with innovative communication across media,
leveraging properties such as cricket and entertainment for brand building and
augmenting its distribution network.
Hero Moto Corp also recently associated itself with the Indian Premier League
(IPL) as a partner and is also the official sponsor of the Delhi Daredevils (Delhis
IPL Team).
Fiscal 2009-10 saw Hero Moto Corp launch new models across segments. The
company more than doubled its volume and share in the premium segment this year,
with the new all-muscle and macho Hunk, and the sporty and stylish CBZ X-treme
both doing very well. Other new launches such as Splendor NXG, and refreshes of
successful models including Pleasure, Super Splendor, and Passion Plus, were
added to Hero Moto Corp s product portfolio in the FY 07-08.
The company also crossed the landmark 20 million cumulative sales during the
course of year.
Hero Moto Corp continues growth momentum with 9.5 per cent increase in may
sales
New launches such as the refreshed splendor nxg & hunk driving volumes in
respective segments
New Delhi, Tuesday, April 21, 2009: New Delhi, June 1, 2008: Carrying on its
impressive growth momentum in the new financial year (2008-09), (HML), the
worlds largest two-wheeler manufacturer for seven consecutive years, today
reported a 9.5 per cent growth in its sales in May 2008.

55
Hero Moto Corp sold 3,12,317 units of two-wheelers in May 2008, as compared to
2,85,109 units in the corresponding month last year. This comes close on the heels
of a nine per cent growth the company had reported in the month of April with sales
of 2,86,252 units of two-wheelers. Thus Hero Moto Corp has already clocked a
total sales of 5,98,569 units of two-wheelers in this financial year.
According to Mr. Anil Dua, Sr. Vice President (Marketing & Sales), Hero Moto
Corp ., Our recent launches such as the refreshed Splendor NXG and the 150cc
Hunk have been driving volumes in their respective segments. While Hunk has
contributed largely to doubling our volume and share in the premium segment, the
refreshed Splendor NXG has been driving the volumes in the deluxe segment. Our
new campaign for Splendor NXG is currently on air on all mainline TV channels.
We continue our strategy of brand building, and we will continue to utilize our
various properties in the field of cricket and youth entertainment towards this end.
We have carried forward our commitment to the promotion of cricket by partnering
the highly-successful Indian Premier League (IPL), as well as being the official
team sponsor of the Delhi Daredevils.
Hero Moto Corp was bestowed the Enterprise Excellence Award 2007 by the
Indian Institution of Industrial Engineering (IIIE) at an awards function held in Goa
in the month of May.
Hero Moto Corp Continues To Consolidate Market Leadership With 27 Per Cent
Growth In August Sales
New Delhi, Tuesday, April 21, 2009: Reports robust sales of 305,516 units during
the month
Cumulative sales in April August 08 grows by 19 per cent
New Delhi, September 1, 2008: Hero Moto Corp (HML), the worlds largest two-
wheeler manufacturer, further consolidated its leadership in the domestic
motorcycle market, with a robust 26.8 per cent growth in sales for the month of
August 2008. The company sold 305,516 units of two-wheelers in August 2008,
compared to 240,875 units in the corresponding month last year.
With this, Hero Moto Corp s cumulative sales in this financial year so far (April-
August 2008) stands at 14,81,077 units as against 12,44,919 units in the
corresponding period last year reflecting a 19 per cent growth in cumulative sales.

56
This carries forward the companys positive growth trajectory since the beginning of
this financial year (2008-09), further augmenting its more than 55 per cent share in
the domestic motorcycle market.
According to Mr. Anil Dua, Sr. Vice President (Marketing & Sales), Hero Moto
Corp , Our strategy is yielding results. The strategy hinges on creating winning
brands across segments, investing in brand building, exploring untapped markets in
rural and upcountry areas while consolidating urban presence and rapidly expanding
our network. However, the industry continues to face uncertainty on account of high
interest rates and overall credit squeeze. The festival month of October is going to
be crucial in determining the overall outlook of the industry for the year.
Key Hero Moto Corp brands continue to drive strong volumes across segments -
CD Deluxe in entry segment, Glamour, the new Splendor NXG, Splendor + and
Passion Plus in deluxe segment, and Hunk, CBZ X-treme and Karizma in the
premium segment.
Hero Moto Corps scooter Pleasure has also been growing strongly, with more than
12,000 units being sold in August this year.
Hero Moto Corp net profit zooms 31% to rs 275 crore in q3 (fy 2007-2008)
Reports turnover of rs. 2795 crore records ebidta of 13.95%
New Delhi, Tuesday, April 21, 2009: Q3 Highlights
Corporate performance: Consolidated over 50% share in the domestic motorcycle
market
Reported highest ever sales in a month in October 2007 (365,022 units)
Crossed half a million retail sales in the festive season
Closed calendar year 2007 with sales of over 33 lakh two-wheelers
Achievements:
Retained the coveted position of World No 1 two-wheeler company for the seventh
consecutive year
Crossed landmark sales of Two Crore bikes; celebrated the achievement with
Hero Moto Corp BIKE-A-THON- a nationwide marathon of Hero Moto Corp
bikes under the Hero Moto Corp Country campaign
New Launches:
Launched two new models Hunk (150cc) & refreshed Splendor+ along with a
Special Edition

57
Doubled volume and share in the premium segment - currently own almost 20%
share
New Delhi, January 31, 2008: Hero Moto Corp . (HML), the worlds largest two-
wheeler manufacturer, today reported 31% per cent growth in profit after tax (PAT)
at Rs 275 crore for the third quarter (October-December) of this financial year
(2007-08). Hero Moto Corps profit after tax in the corresponding period last fiscal
stood at Rs 209.18 crore.
Total Turnover (sales turnover plus other income, net of excise) grew to Rs 2795.17
crores, a growth of 3.54 per cent over Rs 2699.63 crores recorded in the
corresponding period last fiscal. The company has recorded an EBIDTA margin of
13.95% in the quarter. The EBIDTA margin in the previous quarter (July-
September07) was 12.39%.
This strong financial performance comes close on the heels of the companys good
overall sales even in the face of the prevailing slowdown in the two-wheeler
industry. Hero Moto Corps cumulative total turnover for the first three quarters
(AprilDecember 2007) of this financial year stood at Rs. 7673.43 crores.
Hero Moto Corp's strategy for aggressive top line growth through new product
launches, brand building initiatives backed by innovative communication has
resulted in market share gain across every segment. Indeed, Hero Moto Corps share
in domestic motorcycles market has been growing upward of 50 per cent, despite
the slowdown in the two-wheeler industry.
According to Mr. Brijmohan Lall, Chairman, Hero Moto Corp., Our performance
during the third quarter of this fiscal has been very encouraging considering the
current slowdown in the two-wheeler industry. We have been consistently reporting
better-than-industry sales numbers, and it has also been reflected in our bottom line.
We wish to thank all our customers and stakeholders for reposing their faith in our
company and our products.
Mr. Pawan Munjal, Managing Director & CEO, Hero Moto Corp . said, Given the
industry slowdown scenario, we are very enthused by our robust financial numbers
for the third quarter. However, this was not unexpected. We had undertaken some
strategic initiatives since the beginning of this fiscal, including a conscious effort to
rationalize costs across the board, and its results are now visible. Our bottom line
has seen a consistent improvement, and we have been able to demonstrate that it is
possible to keep gaining market share while maintaining a robust bottom line.

58
With input costs softening and our sharp focus on cost efficiencies, we should be
able to further improve upon our financial results, he added.
Hero Moto Corp Passes on Excise Duty Cut Benefit To Customers
New Delhi, March 1, 2008: Passing on the excise duty cut benefit in Budget 2008 to
customers, Hero Moto Corp (HML), the worlds largest manufacturer of
motorcycles, today reduced prices on all its models, ranging from Rs1000/- to Rs
2400/-.
The company, which sold 265,431 units of two-wheelers in the month of February,
reduced the price of Splendor+ by about Rs 1300/- (ex-showroom Delhi) and on
Karizma by about Rs 2400/- (ex-showroom Delhi). Similarly, the price of its best-
selling 150cc bike Hunk has been reduced by about Rs 1800/- (ex-showroom
Delhi).
Mr. Pawan Munjal, MD & CEO, HML, said Hero Moto Corp has taken the voice
of the customer to the government, and consequently the excise duty on two-
wheelers has been reduced to 12 per cent from 16 per cent. This is a welcome move,
and we are happy to pass on the entire benefit to customers. The reduction in excise
duty cut will enable us to draw more customers to our fold, but the basic factors
causing the industry slowdown still remain unattended. Credit financing has been
withdrawn in some key markets, while interest rates on consumer loans also remain
very high. This credit squeeze continues to be the most critical factor adversely
impacting industry growth, and we still dont see any indication from the banks and
the government to address this concern. For the industry to make a turnaround and
get back on the path of growth, the government has to address these key issues.
c) Contacting customer and making sale
Sales performance
Hero Moto Corp reports leadership performance with 50 % net
Total turnover (Net sales & Other Operating income)Rs 3202 crores, growth of 35.6
per cent
Net profit after tax at Rs 306.30 crores, growth of 50 per cent
EBIDTA margin for the quarter 13.58 per cent
Total sales for Q2 stands at 9,72,095 units, growth of 28.5 per cent
Total sales for H1 stands at 18,66,349, growth of 19.7 per cent
Over 55 per cent share in domestic motorcycle market
Launches first-of-its kind music video to celebrate 25 years of Hero Moto Corp

59
New Delhi, October 21, 2008: Hero Moto Corp (HML), the world's largest two-
wheeler company for seven consecutive years, today firmly reiterated its undisputed
leadership in the domestic two-wheeler market with impressive bottom line growth
for the second quarter (Q2) July to September - of this financial year (FY) 2008-09.
Even as the industry continued to face tough market conditions on account of
uncertainty over interest rates and overall credit squeeze, the company reported 50 per
cent growth in profit after tax (PAT) at Rs 306.30 crore for the second quarter. Hero
Moto Corp 's profit after tax in the corresponding period last fiscal (July - Sept, 2009-
10) stood at Rs 204.33 crore.
Total turnover (Net sales & Other Operating income) grew to Rs 3202 crore, a growth
of 35.6 per cent over Rs 2361 crore recorded in the corresponding period last fiscal.
The company has recorded an EBIDTA margin of 13.58 per cent in the quarter. The
EBIDTA margin in the previous quarter (April - June '08) was 12.20 per cent.
The strong financial performance is in line with the company's better-than-industry
top line growth. After posting a growth 11.38 per cent in the first quarter, the company
kicked off the second quarter with a 39.8 per cent growth in sales in the month of July,
and followed up with 26.8 per cent growth in August and 22.4 per cent in September.
Hero Moto Corp consistently keeps growing its share in the domestic motorcycle
market, and currently enjoys over 55 per cent share.
Hero Moto Corp's cumulative sales for the second quarter (Q2) this FY stands at
9,72,095 units - a growth of 28.5 per cent over Q2 last FY (2007-08). The cumulative
sales for the first six months (H1) stands at 18, 66,339 units of two-wheelers
compared to 15, 59,486 units sold in H1 in the last FY reflecting a consistent 19.7
per cent growth in cumulative sales.
Dr. Brij Mohan Lall, Chairman, Hero Moto Corp, said "We are happy with our
financial performance. It gives immense joy to see this kind of results in the 25th year
of our company. I wish to thank all our stakeholders customers, associates, dealer
friends, ancillaries and also our joint venture partners Hero Moto Corp Co for their
continuous support."
Mr. Pawan Munjal, MD & CEO, Hero Moto Corp., said "Our numbers speak for
themselves. Even in this volatile and competitive environment, our top line continues
to outpace the industry growth, our market share is at an all time high, and the
financial balance sheet is a delight all the factors which form the hallmark of a
resilient company with cutting-edge management. We will continue to keep

60
innovating in bringing in technologically-superior products, in our network
expansion, in brand building, in our financial management, and in our
communication."
"Going forward, we will have to keep a close watch on the commodity prices
movement, and other factors such as inflation, interest rate scenario and availability of
retail finance. These factors will play a crucial role in the industry growth in the
subsequent quarters," he added.
Hero Moto Corp has already rolled out its festive season initiatives, with the launch
of four new models the all-new "Passion Pro" and three refreshes of its existing
models - new CBZ X-treme, a selfstart version of Splendor NXG and the refreshed
Pleasure. During the coming months, the company will further augment its product
portfolio with new launches across segments.
Key Hero Moto Corp brands continue to drive strong volumes across segments - CD
Deluxe in entry segment, Glamour, the new Splendor NXG, Splendor + and Passion
Plus in deluxe segment, and Hunk, CBZ X-treme and Karizma in the premium
segment.
Celebrating its 25th year, Hero Moto Corp released an innovative music video in the
month of September. Titled " Hero Moto Corp Dhak Dhak Go", and involving as
many as eight brand ambassadors of Hero Moto Corp, the music video has been
receiving rave reviews.
Hero Moto Corp recently won two very coveted awards - "The Most preferred Brand
of two-wheelers" award at the recent CNBC Awaaz Consumer Awards 2008, and the
"NDTV Profit Business Leadership Award".
d) Order filling
In order to protect against fraudulent encashment, how can one incorporate the details
of his bank account on his dividend warrant. What is the procedure that he should
follow?
If one is holding shares in physical form, he should duly fill the request updation form
for bank mandate and sent the same to our R & ST Agent, M/s. Karvy Computershare
Private Limited. The Company will take on record such request complete in all
respect and incorporate the same on future dividend warrants. However, if one is
holding the shares in electronic mode then such details needs to be furnished to the
respective Depository Participant with whom one holds the demat account and not to
Hero Motors Limited or our R & ST Agent.

61
e) Payment Collection
All elements of current assets are not equally liquid. Inventories are the most
illiquid of current assets. Also bank overdraft, cash credit & other short-term
borrowings which are used as a means of financing current assets. These are
renewable & become due for payment at a particular point of time. Repayment
schedule for such working capital finance is not as short as it is for sundry
creditors. Even such financing arrangements may go year after year with
increasing level of cash credit & bank overdraft limits. So these short term
liabilities are excluded from current liabilities while qualifying liquidity. The
lacuna of this approach is that debtors & advances may become more illiquid than
inventories. The ratio is calculated as below

62
COMPETITORS OF HERO MOTO CORP
BAJAJ
The Bajaj Group came into existence during the turmoil and the heady euphoria of
India's freedom struggle. Jamnalal Bajaj, founder of the Bajaj Group, was a
confidante and disciple of Mahatma Gandhi, and was deeply involved in the effort for
freedom. The integrity, dedication, resourcefulness and determination to succeed
which are characteristic of the Company today, are often traced back to its birth
during those long days of relentless devotion to a common cause.
Kamalnayan, the eldest son of Jamnalal Bajaj, succeeded his father in 1942, at the age
of twenty-seven. Putting the Nation before business, he devoted himself to the latter
only after India achieved independence in 1947. But when he did so, he put his heart
and soul into it. Within a short while, he not only consolidated the Group, but also
diversified into various manufacturing activities, elevating the Group to the status it
enjoys till this day
Rahul Bajaj today heads the Group. He has been the Chief Executive Officer of Bajaj
since 1968 and is recognized as one of the most outstanding business leaders in India.
As dynamic and ambitious as his illustrious predecessors, he has been recognized for
his achievements at various national and international forums. Bajaj is currently
India's largest two and three-wheeler manufacturer and one of the biggest in the
world. Bajaj has long left behind its annual turnover of Rs.72 million (1968), to
currently register an impressive figure of Rs.42.16 billion (US$ 936 million).
TVs- Ltd:
They have a vision of being a highly profitable and socially responsible, leading
manufacturer of high value, environmentally friendly, lifetime personal transportation
products for customers in global markets and to provide fulfillment and prosperity for
employees, dealers and vendors
Suzuki
TVS Suzuki broke out of the bottoming formation with a rise in volume and went
into a major uptrend. The stock is well above its rising 30 WMA and its earlier
intermediate bottoms, and hence, the major trend of the stock is up. The relative
strength line for the stock has moved past its zero line, indicating that the stock is
outperforming the indices. Investors ust hold on to the long positions in the stock

63
while more long positions in the stock must be added after the next intermediate
correction.
The intermediate trend of the stock is still up and investors will have to wait for some
more time before the stock actually goes into an intermediate downtrend. Keep a close
watch at the stock and investors holding the stock must continue to do so. Trading
volumes are less, and hence, investors must pick small quantities.
LML
LML is also in a major uptrend like the other stocks in this sector, as the stock moved
past its earlier intermediate top and its 30 WMA in the current intermediate rise. The
stock is still in an intermediate uptrend and is currently moving sideways. It could
drop into an intermediate downtrend on a close below 19. The breakout by the stock
was not accompanied by a rise in volume and this is not a very bullish sign. Thus,
investors must look at other stocks in this sector which are also in a major uptrend
and are more stronger. The relative strength line has moved above its zero line and
could fall back if the stock goes into an intermediate downtrend. Investors must
always pick up the strongest stocks in the strong sector, and hence, must avoid this
stock, even though it is in a major uptrend.
KINETIC MOTORS
Kinetic Engineering Ltd., founded in the year 1970, is the leading manufacturer and
exporter of 2-wheelers. Born of the vision of the late Shri H. K. Firodia, Kinetic
Engineering Ltd., it has produced useful, heart - winning products for over two
decades. KEL manufactures a wide range of Mopeds, Scooters and Motorcycles that
are very popular in the country and are well recognized for their fuel economy, quality
and reliability.
KEL has 3 manufacturing plants at Ahmednagar Pitampur (Indore) an Goregaon
(Pune) with the capacity to manufacture 4 lakh vehicles per year. Their well endowed
technologically advanced manufacturing set up have enabled them to reach high
quality standards. The company also exports these vehicles to countries like USA,
Canada, Sweden, Latin America, Denmark and the Middle East
An agreement has recently been reached between Yamaha Motor Co., Ltd. (YMC)
and its joint venture partner in India, Escorts Limited (Chairman and Managing
Director: Mr. Rajan Nanda. Location: Faridabad, suburbs of New Delhi) under which
YMC will acquire all of the 26% of the stock presently held by Escorts Limited in the

64
two companies' motorcycle manufacturing and marketing joint venture, Yamaha
Motor Escorts Ltd. (YMEL).
The aims of this move to make Yamaha Motor Escorts a 100% YMC subsidiary are to
increase the overall speed of managerial and business decisions, to improve product
development capabilities and production efficiency, while also strengthening the
marketing organization. Plans call for the change in the company's name and other
procedures to be completed by the end of June.
Ever since the establishment of the first technical assistance agreement between the
two companies in 1985, YMC and Escorts Limited have built a cooperative
relationship dedicated to the manufacture and sales of Yamaha brand motorcycles in
an environment of growing motorcycle demand in the Indian market. In November of
1995, the two companies established the joint venture company Escorts Yamaha
Motor Limited, based on a 50-50 capital investment. In June of 2005, that investment
ratio was changed to 74% for YMC and 26% for Escorts Limited and YMC assumed
managerial control of the company with the name being changed to YMEL and
undertook numerous measures to build the company's motorcycle manufacturing and
marketing operations.
In addition to YMC acquiring Escorts' 26% of YMEL stock, the company's name will
be changed to Yamaha Motor India Private Limited (YMI) and concerted efforts will
be made to heighten its competitiveness in the Indian market and promote the spread
of the Yamaha brand with target themes of developing products with greater appeal
and a distribution network that can respond more quickly to user needs.
Furthermore, YMC will work to develop YMI as an exporter of business type
motorcycles to neighboring countries and other markets such as Africa and Latin
America, and also as a production base that can assume a variety of roles in Yamaha's
global manufacturing network.
Presently, India's annual motorcycle demand has grown to exceed 3.8 million units,
which makes it the second largest market in the world, with steady growth is
anticipated for the future. Now that YMI has become a 100% YMC subsidiary, the
introduction of several new models is planned, and it is our goal to increase annual
production to 350,000 units in the fiscal year 2005 and to 550,000 units by the fiscal
year 2010.

65
SWOT ANALYSIS: HERO-HERO
STRENGTH WEAKNESS
Technological support from Hero Moto Hero Moto Corp depends on Hero for
Corp. new products and this is a big weakness
The company has a deeply penetrated considering it from the post 2005 point of
dealer network (640 including service view. The reason being that the
station) technological tie-up between Hero Moto
The company provides good after sales Corp and Hero Moto Corp will cease to
service through its well-established exist.
dealer network. Exports has never grown beyond 4%
The company enjoys a huge market share The company doesn't have a product
and well established brands like catering to Rs. 25,000 - Rs. 30,000
Splendor, CD100, CBZ, etc.(Splendor is segment.
worlds largest selling motorcycle) The company imports about 31% of its
spares requirements. This makes the
company vulnerable to the import
policies of the government. It also
exposes them to the exchange rate risk.
OPPORTUNITY THREATS
The motorcycle segment is growing at The technical collaboration with Hero is
the rate of 33%, which provides a great valid only till 2005 and this is a serious
opportunity for the company to cash on. threat as they have been dependant on
Also it is experiencing a shift in the Hero for technology. Also Hero has set
customer preference from 4-stroke up its 100% subsidiary in India, which
mobikes to 2-stroke mobikes. This again shall start producing motorcycles from
provides an excellent opportunity to 2004. This will further increase the
Hero Moto Corp to leverage its market competition.
share and market leadership for sustained Threats from Chinese companies which
profitability. are going to launce Hi-Tech and Low cost
products
Weak competition in 125 cc & 200(+) cc The company has plans to foray into the
segment scooter segment, which can also be a
major threat for the future prospects of
the company.

66
CHAPTER 4
RESEARCH METHODOLOGY

67
NEE OF THE STUDY :
To know the following
1. What is the prospective customers market for Hero Moto Corp in the world
2. Know the choice of residents of other foreign countries
3. Know the brand image of Hero Moto Corp
4. Perceive the future sales of Hero Moto Corp products
5. Pricing in the view of prospective customers
6. Mode of purchasing the product

68
OBJECTIVE OF THE STUDY :
The objective of survey is to know the strategy of Hero Moto Corp in the world
market and we must know what should be the price range and what types of
marketing should be done so that it gets familiar with every type of person. So needs
and objectives of the market survey is very important to get a good market share ,
stand in the market and to survive the business in the present competitive world where
there is a trend of cutthroat competition.
Hero Moto Corp is a leading company in bikes sector. Knowing the comparative
position of a brand vis--vis its competitors is an essential thing as well as product is
essential for deciding appropriate marketing strategies for any company.

69
RESEARCH DESIGN:

TYPES OF DATA COLLECTION

Data can be defined as the quantitative or qualitative values of a variable. Data is


plural of Datum which literally means to give or something given. Data is thought to
be the lowest unit of information from which other measurements and analysis can be
done. Data can be numbers, images, words, figures, facts or ideas. Data in itself
cannot be understood and to to get information from the data one must interpret it into
meaningful information. There are various methods of interpreting data. Data sources
are broadly classified into primary and secondary data.

IMPORTANCE OF DATA AND DATA COLLECTION:

Data is one of the most important and vital aspect of any research studies. Researches
conducted in different fields of study can be different in methodology but every
research is based on data which is analyzed and interpreted to get information.

Data is the basic unit in statistical studies. Statistical information like census,
population variables, health statistics, and road accidents records are all developed
from data.

Data is important in computer science. Numbers, images and figures in computer are
all data.

Types of Data

Primary Data:

Data that has been collected from first-hand-experience is known as primary data.
Primary data has not been published yet and is more reliable, authentic and objective.
Primary data has not been changed or altered by human beings, therefore its validity
is greater than secondary data.

70
Importance of Primary Data:

Importance of Primary data cannot be neglected. A research can be conducted without


secondary data but a research based on only secondary data is least reliable and may
have biases because secondary data has already been manipulated by human beings.
In statistical surveys it is necessary to get information from primary sources and work
on primary data: for example, the statistical records of female population in a country
cannot be based on newspaper, magazine and other printed sources. One such sources
are old and secondly they contain limited information as well as they can be
misleading and biased.

Validity: Validity is one of the major concerns in a research. Validity is the quality of
a research that makes it trustworthy and scientific. Validity is the use of scientific
methods in research to make it logical and acceptable. Using primary data in research
can improves the validity of research. First hand information obtained from a sample
that is representative of the target population will yield data that will be valid for the
entire target population.

Authenticity:Authenticity is the genuineness of the research. Authenticity can be at


stake if the researcher invests personal biases or uses misleading information int he
research. Primary research tools and data can become more authentic if the methods
chosen to analyze and interpret data are valid and reasonably suitable for the data
type. . Primary sources are more authentic because the facts have not been overdone.
Primary source can be less authentic if the source hides information or alters facts due
to some personal reasons. Their are methods that can be employed to ensure factual
yielding of data from the source.

Reliability:Reliability is the certainty that the research is enough true to be trusted


on. For example, if a research study concludes that junk food consumption does not
increase the risk of cancer and heart diseases. This conclusion should have to be
drawn from a sample whose size, sampling technique and variability is not
questionable. Reliability improves with using primary data. In the similar research
mentioned above if the researcher uses experimental method and questionnaires the

71
results will be highly reliable. On the other hand, if he relies on the data available in
books and on internet he will collect information that does not represent the real facts.

Sources of Primary Data:

Sources for primary data are limited and at times it becomes difficult to obtain data
from primary source because of either scarcity of population or lack of cooperation.
Regardless of any difficulty one can face in collecting primary data; it is the most
authentic and reliable data source. Following are some of the sources of primary data.

Experiments:Experiments require an artificial or natural setting in which to


perform logical study to collect data. Experiments are more suitable for medicine,
psychological studies, nutrition and for other scientific studies. In experiments the
experimenter has to keep control over the influence of any extraneous variable on the
results.

Survey: Survey is most commonly used method in social sciences, management,


marketing and psychology to some extent. Surveys can be conducted in different
methods.

Questionnaire: is the most commonly used method in survey. Questionnaires


are a list of questions either open-ended or close -ended for which the
respondent give answers. Questionnaire can be conducted via telephone, mail,
live in a public area, or in an institute, through electronic mail or through fax
and other methods.
Interview: Interview is a face-to-face conversation with the respondent. In
interview the main problem arises when the respondent deliberately hides
information otherwise it is an in depth source of information. The interviewer
can not only record the statements the interviewee speaks but he can observe
the body language, expressions and other reactions to the questions too. This
enables the interviewer to draw conclusions easily.
Observations: Observation can be done while letting the observing person
know that he is being observed or without letting him know. Observations can
also be made in natural settings as well as in artificially created environment.

72
SECONDARY DATA:

Data collected from a source that has already been published in any form is called as
secondary data. The review of literature in nay research is based on secondary data.
Mostly from books, journals and periodicals.

IMPORTANCE OF SECONDARY DATA:

Secondary data can be less valid but its importance is still there. Sometimes it is
difficult to obtain primary data; in these cases getting information from secondary
sources is easier and possible. Sometimes primary data does not exist in such situation
one has to confine the research on secondary data. Sometimes primary data is present
but the respondents are not willing to reveal it in such case too secondary data can
suffice: for example, if the research is on the psychology of transsexuals first it is
difficult to find out transsexuals and second they may not be willing to give
information you want for your research, so you can collect data from books or other
published sources.

Sources of Secondary Data:

Secondary data is often readily available. After the expense of electronic media and
internet the availability of secondary data has become much easier.

Published Printed Sources: There is variety of published printed sources. Their


credibility depends on many factors. For example, on the writer, publishing company
and time and date when published. New sources are preferred and old sources should
be avoided as new technology and researches bring new facts into light.

Books: Books are available today on any topic that you want to research. The
use of books start before even you have selected the topic. After selection of
topics books provide insight on how much work has already been done on the

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same topic and you can prepare your literature review. Books are secondary
source but most authentic one in secondary sources.
Journals/periodicals: Journals and periodicals are becoming more important as
far as data collection is concerned. The reason is that journals provide up-to-
date information which at times books cannot and secondly, journals can give
information on the very specific topic on which you are researching rather
talking about more general topics.
Magazines/Newspapers: Magazines are also effective but not very reliable.
Newspaper on the other hand are more reliable and in some cases the
information can only be obtained from newspapers as in the case of some
political studies.

Published Electronic Sources:As internet is becoming more advance, fast and


reachable to the masses; it has been seen that much information that is not available in
printed form is available on internet. In the past the credibility of internet was
questionable but today it is not. The reason is that in the past journals and books were
seldom published on internet but today almost every journal and book is available
online. Some are free and for others you have to pay the price.

E-journals: e-journals are more commonly available than printed journals.


Latest journals are difficult to retrieve without subscription but if your
university has an e-library you can view any journal, print it and those that are
not available you can make an order for them.
General websites; Generally websites do not contain very reliable information
so their content should be checked for the reliability before quoting from
them.
Weblogs: Weblogs are also becoming common. They are actually diaries
written by different people. These diaries are as reliable to use as personal
written diaries.

Unpublished Personal Records: Some unpublished data may also be useful in


some cases.

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LIMITATIONS OF THE STUDY:
1.
In my survey I found some limitations are as follows:
Time was limited.
Material on internet is very limited.
Some customers were in hurry so they were not given proper opinion.
Foreign data is not available on the net.
Bikes are exporting to very limited country

75
CHAPTER 5
DATA ANALYSIS &
INTERPRETATION

76
DATA ANALYSIS
For finding the result of Marketing Strategy in purchase of motor bike we have to
go through the customers perception and attitude. As for example age group,
house holds annual income and purchase. These things focus the Marketing Mix.
Then we have to go in details of all factors of coaster of Marketing Strategy as
family, gender, geographic location, social, cultural, income age, sex etc.
consumer behaviour are quite different their prepurchase, purchase decision and
post purchase behaviour. For different product consumer behaves in different way.
For buying the motel motor bike consumer prefer look robustness, Mileage and
comfortable. Brand image of the products is very important. Finding through the
consumer survey through questionnaire as follows.
Approximately 60% user are between the age group of 18 to 25, then 25-35.
thus mostly the young prefer to riding the bike generation.
Most of the customer are in the annual income group 60,000 to 1 lakh. It
means high income group mostly preferred four wheeler.
Most of the customer between the age group of 25 to 35 use bike office going
purpose and 18 to 25 for college going or maintain their fined circle
Brand of the product most affect the behaviour of the consumer.
Customer known about the brand mostly through T.V. and word of month.
Price a not effect the consumer it the quality, availability and after sales
services are good.
In case of decision making friends, parents players an important role.
Consumer buying decision affected by physical feature and technological
feature of the bike.

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1. MOTOR BIKE USERS AGE GROUP
AGE PERCENTAGE (%)
14-18 20
18-25 60
25-35 15
ABOVE 35 5

5%
15% 20%

14-18
18-25
25-35
Above 35

60%

2. PURPOSE OF PURCHASE OF BIKE?


OFFICE GOING 39%
COLLEGE GOING 25%
MAINTAINS FRIENDS 14%
OTHER PURPOSE 22%

22%
39% Office going
College going
Maintains Friends
14%
Other purpose

25%

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3. MARKET SHARE OF BIKE?
HERO MOTO CORP 40%
BAJAJ 32%
SUZUKI 12%
YAMAHA 11%
OTHERS 5%

5%
11%
Hero Honda
40%
12% Bajaj
Suzuki
Yamaha
Others
32%

4. BRAND AWARENESS MEDIUM?


TV 38%
NEWSPAPER 25%
WORD OF MOUTH 23%
DEALER EFFORT 9%
OTHERS 5%

9% 5%

38% TV
Newspaper
Word of mouth
23% Dealer effort
Others
25%

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5. PURCHASE INFLUENCER
QUALITY & FEATURE OF PRODUCT 15%
PRICE 10%
EASE OF AVAILABILITY 15%
BRAND IMAGE OF THE PRODUCT 24%
AFTER SALES SERVICE 32%
VALUE OF MONEY 4%

Quality & feature of product

Price
4% 15%
Ease of availability
32% 10%

Brand image of the


product
15% After sales service

24%
Value of money

6. PHYSICAL FEATURES THAT EFFECTS MOST?


LOOKS 35%
BODY BUILDS 25%
STYLE 22%
ROBUSTNESS 18%

18%
35%
Looks
Body builds
Style
22% Robustness

25%

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7. PAYMENT MODE FOR PURCHASES
ONE TIME PAYMENT 15%
FINANCIAL OPTION 65%
EXCHANGE OFFER 12%
OTHERS 8%

8% 15%
12%
One time payment
Financial option
Exchange offer
Others
65%

8. TECHNOLOGICAL FEATURES EFFECT BUYING?


POWER - ECONOMY MODE 22%
MILEAGE 48%
FOUR STROKE ENGINE 18%
OTHER 12%

12% 22%
Power - economy mode
18%
Mileage
Four stroke engine
Other
48%

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9. PURCHASE MADE FROM
AUTHORIZED DEALER 47%
NEAR BY DEALER 33%
ONLINE 13%
OTHER 7%

10. BETTER AFTER SALES SERVICE BRAND ?


BAJAJ CALIBER 18%
PASSION 24%
TVS VICTOR 28%
AMBITION 25%
OTHERS 9%

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11. BIKE PREFER IN FUTURE PURCHASE?
CALIBER 22%
PULSAR 15%
PASSION 27%
AMBITION 29%
OTHER 7%

7% 22%
Caliber
29% Pulsar
Passion

15% Ambition
Other
27%

Hero Moto Corp has built leadership positions primarily due to its belief in the
following principles
Understanding stakeholder (incl. International partners and customers) expectations
and delivering value for money Managing relationships Creating a Performance
culture Partnership Approach with ancillaries Efficient Current Asset Management
Accepting and using ever-changing technology as a facilitator Strong quality and
process orientation
Results of Hero Moto Corp initiatives
The Hero Moto Corp philosophy of empowering and training human capital, use of
appropriate technologies, and constantly being close to the customer and with the
maintaining a healthy work environment with the highest standards of ethics and
corporate governance has resulted in the Group companies through excelling in their
chosen field through, impressive attitude year after year, leading to impressive
financials and healthy returns to all stakeholders .
Hero Moto Corp to finalise third unit location, investment soon
TWO-WHEELER manufacturer Hero Moto Corp is close to finalising a location for
its third manufacturing plant in the country. The company, which now has capacities

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of 2,40,000 units annually from its existing manufacturing facilities will shortly
announce the location and investments that will go into the new manufacturing
facility, Mr Pawan Munjal, Managing Director, said here on Monday.
"We have been experiencing capacity constraints, especially after launching new
models, and while we are in the process of continuously adding capacities the issue
will be resolved after our third facility is set up," Mr Munjal said. "We expect to reach
the three-million level in this fiscal with our existing facilities," he added.
The two-wheeler company is also in talks with joint venture partner Hero to make its
operations a sourcing hub for the export markets, Mr Munjal said. "Hero has
manufacturing and distribution presence across the world but we are convincing them
to make us the sourcing hub for the 100, 125 and 150 cc range. There is a significant
cost advantage in it and the talks are currently on about various possibilities," he said.
The company's exports, largely to Sri Lanka, Bangladesh and Latin America, grew
over 60 per cent in the last fiscal to 65,000 units and it is expecting to cross the
100,000-mark this year. Mr Munjal, however, ruled out the possibility of setting up
assembly operations to feed its export business.
Hero Motors, meanwhile, is also gearing up for the launch of two other models, one
of them in the 150 cc power segment of the motorcycle market, in the current fiscal.
Work is also under way on a range of new Quantum Core engines that Hero is now
developing that will soon be deployed on its new vehicles, especially in the power
range, said Mr Atul Sobti, Executive Director, Business Operations.
Meanwhile, the company's new 125 cc Glamour model has already sold over 15,000
units in the two weeks since its launch, according to Mr Sobti, who said that work is
on to ramp up production in a phase, given the capacity constraints that it is currently
experiencing. "We expect to reach the level of 30,000 units/month six months from
now," he said
Hero Moto Corp sales up 34%
Hero Moto Corp on Thursday reported a 34 per cent rise in sales in May at 3.03 lakh
units as against 2.26 lakh units in the same month last year. The sales in the domestic
market stood at 2,93,758 units during May this year, while exports stood at 9,908
units sales increased due to export and company is going globaly

84
Passport to Customer Loyalty
Last April Hero launched the Hero Moto Corp Passport, a program designed to
increase customer loyalty. Customers who sign up are issued "passports," and they
receive points when purchasing parts or referring new customers. "This helps us in
getting to know our customers better," says Pawan Munjal. "We have 600,000
members in the program, and we also organize events where they can meet sports
stars and film stars. This creates loyalty in our customers."
But to create loyal customers, a company must first have loyal employees.
"Fortunately, Hero has a good name, Hero has a good name, so we attract very good
people," says Brijmohan Lall, who at 79, still continues to put in a full day's work as
chairman. "With our long experience we have created a friendly atmosphere. My door
is never closed, so anyone can walk in at any time."
As a reward for becoming the world's largest motorcycle manufacturer, the Munjals
took the managers (along with their wives) who had contributed most to this success
on a vacation to Switzerland last year. "We conducted a seminar on top of a Swiss
mountain to symbolize our success," says Brijmohan Lall. "We also invited a
professor from Harvard University to come and give us a talk on how we must now
compete and sustain ourselves at this new level."
Hero Moto Corp's IT Strategy
With the Indian motorcycle market opening up to overseas competitors and more
fierce domestic competition, Hero Moto Corp decided it needed to overhaul its
various computer systems and create a single integrated IT system. Rather than
continue to use computers merely for data processing, it sought to use IT to integrate
business operations such as product planning, materials resource planning, financials
and sales and distribution. It was also looking to automate its internal supply chain,
reduce overall costs, and create a transparent information system that would help
managers make decisions more quickly. To do all this it teamed up with SAP in June
2000 to implement the system, and went live in February 2001.
"Now we can look at the same information, when earlier we had three or four
different versions, which didn't always match," says Pawan Munjal. "Now we (the
managers) can all look at the same costs, for example, because all the information is
up there on the screen. Nothing is hidden, everything is transparent. So there are no
arguments over figures now, which used to waste time and hold up decision-making."

85
There are improvements on the factory floor too, now that manufacturing has been
brought into the new IT system. In the past there was no accurate way of checking the
consumption of raw materials and inventory in general. So excess stocks in some
areas became an inevitability. "Now we know what should be there and what is there,"
says Pawan Munjal. At the same time, defective parts and materials are no longer
accepted, forcing suppliers to upgrade their quality.
"The next step is to get dealers and suppliers online, so that orders can be taken
directly by the suppliers," says Pawan Munjal. This will eliminate any wastage that is
still left in our supply chain."
In upcoming issues of the SAP 30th Anniversary Leadership Interview series, we
learn how experience, innovation and vision are driving other major Asian
corporations to be leaders in their fields

86
CHAPTER 6
CONCLUSION &
RECOMMENDATIONS

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CONCLUSION :
The motorcycle industry had a perceptible shift from a buyer market to the seller
market with the variety of choices. Now the customer even has a plethora of choices
to choose the best-suited requirement. All the players, weather be it HML, Yamaha or
any other will have to compete on the basis of many things like attributes, reliability
and so on. There is no doubt in the fact that Hero Moto Corp Company rules the
motorcycle industry and has a good brand name, but the company will certainly have
to initiate some efforts. The company has then highest market share in the motorcycle
industry and maintaining such a good share will pose a challenge to the company. The
company is doing very well in the business. According to me, no other company can
beat this company in the years to come because of its strong brand name in the
market. This company would be successful in the years to come as the company has
good amount of brand loyal customers. When there is talk of bike, the first thing that
comes to mind is Hero Moto Corp because of strong brand image. In our study the
main emphasis was towards the marketing mix elements (Product, Place, Price and
Promotion). The analysis is totally based on the marketing mix elements. Further for
analyzing the market share of the company properly; a survey was conducted which
also forms a part of the findings.
The two-wheelers market has had a perceptible shift from a buyers market to a sellers
market with a variety of choices. Players will have to compete on various fronts viz
pricing, technology, product design, productivity, after sale service, marketing and
distribution. In the short term, market shares of individual manufacturers are going to
be sensitive to capacity, product acceptance, pricing and competitive pressures from
other manufacturers
The segments, motorcycles have witnessed capacity additions in the last one-year and
it will continue in the upcoming period as and when Hero opens a local subsidiary.
Over this period, only the motorcycle segment is expected witness higher demand vis-
-vis supply, while the scooters and mopeds supply will outstrip demand.
As incomes grow and people feel the need to own a private means of transport, sales
of two-wheelers will rise. Penetration is expected to increase to approximately to
more than25% by 2010.

88
The motorcycle segment will continue to lead the demand for two-wheelers in the
coming years. Motorcycle sales is expected to increase by 20%yoy as compared to
1% growth in the scooter market and 3% by moped sales respectively for the next
two-years
The four-stroke scooters will add new dimension to the two-wheeler segment in the
coming future. Perhaps, the moped segment will be the worst affected due to Y2K
emission norms applicable from April 2002 as not many of the present models
confirm to the norms
The three-wheeler segment will witness 10%yoy growth for the next two years. In
spite of entry of Piaggio, Italy into the three-wheeler segment in the country, Bajaj
Auto will continue to dominate the segment. In this segment, we would see players
shifting from diesel to cleaner fuels like CNG in line with norms set out by various
state governments.
On surveying Hero Moto Corp globalization, it was found that the competetion &
price where preferred in the bike comparison with other company. Serviceman and
businessman both like this Hero Moto Corp bike, Mileage,4-stroke,4-gear&11.0 BHP.
Opinions are all most same. In my survey I found that there are only 05% bike
exports to outside India
JOURNEY SO FAR
Indian companies had relied heavily on their foreign counterparts for technical
support, design of the model etc., while they provided the distribution and branding in
the Indian market. Now that the international market for motorcycles is fairly
developed and consumers are well aware, most of these foreign manufacturers are
planning to enter the market on their own. The inadequacy of the public transportation
system, the upwardly mobile middle class, which has the disposable income and the
intent to own a two-wheeler and the sheer size of the Pakistan,bangladeshand srilanka
market is proving to be an attractive factor to many multinational companies. India's
two-wheeler industry is the second largest market in the world after China. Hero Moto
Corp, whose tie-up with Hero-Hero is going to expire soon, has already entered the
fray with Hero-Activa. Others are also queuing up.
Yamaha Corporation, which was operating in India through a joint venture with
Escorts Group, had decided to call it quits in mid-2001 by buying off Escorts' 50
percent share in the joint venture. Yamaha now plans to tap the Indian market on its
own with models such as RX-135, RXZ, YBX125, YD125, and ACE. Its name has

89
become fairly established while the joint venture had been in operation for two
decades. On its own now, Yamaha has started implementing its ambitious plans for the
Indian market and has embarked on a challenge 21 project, a time-bound initiative
that is aimed at reorienting and revitalizing the entire Indian operations in order to
achieve a competitive edge. Yamaha has set for itself the target of capturing 21
percent of motorcycle market by 2005. India is one of the few countries where
Yamaha, the world's second largest motorcycle manufacturer operates a fully-owned
subsidiary.

90
RECOMMENDATIONS :
There are no two opinions that the automobile industry is faring very well in the
Indian market since the early 90s.However it can perform better in the market of it
o The first recommendation is obviously about the customer care. Presently the
company has a customer relation department but it has to be made stronger
and more service provider to help the customers.
o The distribution network should be made stronger so that the customers dont
feel dissatisfied for services, sales, and stocks.
o This is a age of customer delight and the company should not forget that
customer is the king
o Everywhere there is a game of production and volumes, the company that
produces more can save more and prices could be made more competitively
o The company should always go for quality
o The R & D base should be made stronger as the level of indigestion should
come down.
After doing market research I would like to suggest or recommend to the Company
that there are certain out comes of research, which followed through the formal and
informal procedure during the research. Thus we are bound to draw the attention of
Company to certain points which are ought to be perceived by the Company with full
care.
2. Publicity and advertisement should be broad, because competition is more.
3. Size and weight of bike should be match with their C.C.
4. company should follow world wide strategies for increasing their global
revenue.
5. Bike should have stepping facility. Which may help during critical situation.
6. Company should provide promotional schemes to the customers.
7. All the protective parts of wheels should made of plastic and leg guard also be
strong.
8. Now Company is required to recover the faith of customers towards the brand
image.
9. Company should improve the mileage of the Bikes.
10. Prices of the Bike must be set as it can be approved by major part of the
population.

91
CHAPTER 7
BIBLIOGRAPHY & ANNUXURE

92
BIBLIOGRAPHY
1. Phillip Litler Marketing management (Prentice-Hall of India Pvt.).
2. Harper W. Bayd, Ralph West Fall, and Stanley F. Stasch Marketing research
(AITBS Publisher 7th ed. 2001).
3. A.G. Sawyer and Davied J Howard, Journal of Marketing research 1999.
4. consumer Behaviour by Leon G. Schiffman and Leslie Lazar Kanuk (Fifth
edition)
5. Research Methodology by C.R. Kothari (Second Edition)
6. Business world and Business India magazine.
7. Auto India Magazine for two and four wheeler.
INTERNET
http://encyclopedia.thefreedictionary.com/Hero+Hero
http://www.heroHero.com/co_policy.htm
http://www.heroHero.com/co_board_directors.htm
http://www.cmsnl.com/news/Hero-to-strengthen-structure-of-its-rd-
operations_news245.html
http://www.etalkindia.com/indian_automobiles_news_forums/new_variant_of_hero_
Hero_bikes_launchedglamour_fi_and_cd_delux-t3336.0.html
http://www.cmsnl.com/search.php
www@heromotorcycle.com website of Hero Moto Corp bike.
www@tvsuzuki.com website of Suzuki motor bike.
nvswaminathan@bajajauto,com.

93
QUESTIONNIRE
Motor bike is not a luxury it has become the necessity in 21 st century. I would like
take few minutes of your precious time, Just to know about your views for
different bike. I assure you that your information will be confidential and it would
not be share by other organization.
Name:
Age: Sex:
Occupation:

1. Which of the following best describe your age group?


a) 14-18 b) 18-25 c) 25 to 35 d) above 35

2. What is the size of your family (Including children)?


a) Single b) 2 to 3 c) 3-4 d) above 4

3. Which of the following best identifies you house hold annual income?
a) Below 60,000 b) 60,000 to 1 Lakh
c) 1 to 2 lakh d) Above 2 lakhs

4. For which purpose you purchase the motorbike?


a) College going b) Office going
c) Maintain friend circle d) Other purpose

5. Which of following companys motorbike do you have ?


a) Bajaj b) HERO MOTO CORP
c) Suzuki d) Yamaha
e) Any other

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6. How come you know about that brand? (can make more than one)
a) T.V. b) Newspaper
c) Dealer effort d) World of mouth
e) Internet f) Any other

7. Rate the following in order of influence you purchase a bike?


a) Brand image of the product
b) Price
c) After sales service
d) Quality and feature of product
e) Ease of availability
f) Value for money

8. Which option you prefer when you purchase a bike ?


a) One time payment
b) Financial option
c) Exchange offer
d) Any other.

9. Who was the decision maker in your purchase of motor bike?


a) Parents b) Friends c) Yourself
d) Spouse e) Other

10. Which physical features contributed most in you buying decision?


a) Looks b) Body build
c) Style e) Robustness

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11. What technological feature effected in your buying decision?
a) Power economy mode b) Mileage
c) Four stroke engine d) Any other
12. From where did you purchase your bike?
a) Authorized outlet b) Near by dealer
c) Online d) Any other

13. Which brand has better after sales service?


a) Bajaj Caliber b) Passion
c) TVS victor d) Ambition
e) LML Freedom f) Other.

14. Are you satisfied with your decision?


a) Highly satisfied
b) Satisfied
c) Neither satisfied nor dissatisfied
d) Dissatisfied

15. Which bike do your prefer for buying in future?


a) Caliber b) TVS Victor
c) Pulser d) Passion
e) Ambition f) LML Freedom
g) Other

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