India case study on bajaj


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India case study on bajaj

  1. 1. INDIA CASE STUDY ON BAJAJIntroductionIn most of the companies the promotional function was dominated by mass media,advertising for many years. Companies relied primarily on their advertising agencies forguidance in nearly all the areas of marketing communication. Most marketers did useadditional promotional and marketing communication tools but sales promotion and directmarketing agencies as well as package design firms were generally viewed as auxiliaries’services and often used on a per project basis. Public relations agency was used to managethe organisations publicity, image and affairs with the relevant publics on an ongoing basisbut they were not viewed as integral participants in the marketing communication process. Many marketers built strong barriers around the various marketing and promotionalfunctions and planned and managed them as separate practices with the different budgets,a different view of the market with different goals and objectives. But these companiesfailed to recognise that the wide range of marketing and promotional tools must becoordinated to communicate effectively and present a consistent image to target market. During the 1980’s, many companies began taking a broader perspective of marketingcommunication in seeing the need for the more strategic integration of their promotionaltools. The decade was characterized by rapid development in the areas of sales promotion,direct marketing an public relation which began challenging the advertising role as thedominant form of marketing communication{IMC}, which involves coordinating the variouspromotional elements and other marketing activities that communicate with the firm’scustomersDefinationIntegrated marketing communication is a strategic business process used to plan, develop,exec cute and evaluate coordinate, measurable persuasive brand communications programsover time with customer’s consumers, prospectus, employees, associates and othertargeted relevant external and internal audiences. The goal’s to generate both short termfinancial returns and build long-term brand and shareholder value.AN OVERVIEW OF INTEGRATED MARKETING COMMUNICATION Advertising has much strength like reaching mass audiences, creating awareness, buildingpreference, etc, but it also has major weaknesses like targeting individual consumers,making them believe a message and pushing them to action. Thus, it has to be combinedwith that of other communication elements such as direct marketing, sales promotions, andpublic relation. The various promotional tools involved in product promotion comprise thepromotional mix of an organization. They include advertising, personal selling, salespromotion, public relations, and direct marketing. Integrated Marketing Communication(IMC) is the judicious and efficient use of the promotional tools so that a universal, clear,and effective promotional message is communicated amongst the target audience. Theconcept includes online and offline marketing channels. Online marketing channels includeany e-marketing campaigns or programs, from search engine optimisation SEO, pay-perclick, affiliate, and email, banner to latest web related channels for webzine, blog, micro-blogging, RSS, pod cast, and Internet TV. Offline marketing channels are traditional print(newspaper, magazine), mail order, public relations, industry relations, billboard, radio andtelevision.The role of IMC in Branding:
  2. 2. One of the major reasons for the growing importance of the IMC over the past decade isthat it plays a major role in the process of developing and sustaining brand identity andequity. Building and properly managing brand equity has become a priority for companies ofall the sizes, in all types of industries, and in all types of markets. With more and moreproducts and services competing for consideration by customers who have less and lesstime to make choices, well-known brands have a major competitive advantage in today’smarket place. Building and maintaining brand identity and and equity requires the creationof well –known brands that have favourable, strong and unique association in the minds ofthe consumer.There are five basic tools of integrated marketing communication: Advertising:This tool can get your messages to large audiences efficiently through such avenues asradio, TV, Magazines, Newspapers (ROP), Internet, Billboards and other mobiletechnological communication devices. This method can efficiently reach a large number ofconsumers, although the costs may be somewhat expensive. Sales Promotion:This tool is used through coupons, contests, samples, premiums, demonstrations, displaysor incentives. It is used to accelerate short-term sales, by building brand awareness andencouraging repeat buying. Public Relations:This integrated marketing communications tool is initiated through public appearances,news/press releases or event sponsorships, to build trust and goodwill by presenting theproduct, company or person in a positive light. Direct Marketing:This tool will utilized email, mail, catalogs, encourage direct responses to radio and TV, inorder to reach targeted audiences to increase sales and test new products and alternatemarketing tactics.Personal Selling:Setting sales appointments and meetings, home parties, making presentations and any typeof one-to-one communication, to reach your customers and strengthen your relationshipwith your clients, initiate this IMC tool.Integrated Marketing ExamplesNike is a great example of a company that has fully embraced the concept of integratedmarketing. Their integrated approach includes traditional advertising (billboard, magazine,and television); sponsoring sporting events and players such as the Super bowl and TigerWoods; and engaging in online marketing initiatives by allowing consumers to customizetheir Nike shoes. They also spend a great deal of money in search marketing. Nikesapproach allows them to communicate their message consistently across all media outlets;and at the same time share that message at every customer touch point; that is, use Nikeproducts and you will increase your performance regardless of what sport you are involvedin.Another example is HPs "The Computer is Personal Again" campaign. They utilized manyforms of media with great consistency, and capitalized on each of the medias individualstrengths.Benefits Of IMCAlthough Integrated Marketing Communications requires a lot of effort it delivers manybenefits.
  3. 3. 1. Carefully linked messages also help buyers by giving timely reminders, updated information and special offers which, when presented in a planned sequence, help them move comfortably through the stages of their buying processBarriers to IMC Sadly, some organisational structures isolate communications, data, and evenmanagers from each other. For example the PR department often doesn’t report tomarketing. The sales force rarely meets the advertising or sales promotion people and soon. Imagine what can happen when sales reps are not told about a new promotional offer IMC can restrict creativity. No more wild and wacky sales promotions unless they fitinto the overall marketing communications strategy.GOLDEN RULES:Despite the many benefits of Integrated Marketing Communications (or IMC); there are alsomany barriers. Here’s how you can ensure you become integrated and stay integrated – 10Golden Rules of Integration.10 Be prepared to change it all. Learn from experience. Constantly search for the optimumcommunications mix.
  4. 4. Importance of objectives :Advertising and promotional objectives are needed for several reasons, including thefunctions they serve in communication, planning and decision-making and measurementand evaluation.Communications: Many people are involved in the planning and development of anintegrated marketing communications programmed on the client side as well as in variouspromotional agencies. The advertising and promotional programme must be co-coordinatedwithin the company, inside the ad agency, and between the two. Any other parties involvedin the promotional campaign, such as the public relations or the sales promotion firms,research specialist or media buying services must also know what company hopes toaccomplish through its marketing communication programme.Planning and Decision Making: when the promotional objectives are specific they guidethe development of the integrated marketing communications plan. All the phases of thefirm’s promotional strategy should be based on the established objectives, includingbudgeting, creative and media decisions as well supported programmes such as directmarketing, public relations, sales promotion or reseller support. Decision making becomeseasier if the objects are meaningful.Measurement and evaluation of Results:one of the important reasons for settingspecific objectives is that they provide a benchmark against which the success or failure ofthe promotional campaign can be measured. Without specific objectives, it is extremelydifficult to determine what the firm’s advertising and promotional efforts accomplished. Thepromotional planners provide measures that can be used to evaluate the effectiveness ofthe marketing communication programme. Comparing actual performance against themeasurable objectives is the best way to determine if the return justifies the expense.Promotional Objectives:
  5. 5. To increase brand awareness by 25%, Build Awareness about the product. Tell the marketwho they are and what they have to offer. Create Interest – Moving a customer fromawareness of a product to making a purchase can present a significant challenge. ProvideInformation, Stimulate Demand, once a purchase is made, a marketer can use promotion tohelp build a strong relationship that can lead to the purchaser becoming a loyal customer.For instance, many retail stores now ask for a customer’s email address so that follow-upemails containing additional product information or even an incentive to purchase otherproducts from the retailer can be sent in order to strengthen the customer-marketerrelationship.Communications Objectives:Some common marketing communication objectives include: 1. Create a brand awareness for your company 2. Defining a need the product or service can fulfil 3. Encouraging action from the targetSales Objectives:Many managers believe that monies spent on advertising and other forms of promotionshould produce measurable results, such as increasing sales volume by a certain percentageor increasing the brand’s market share.Advertising StrategiesInformation, Dissemination/Persuasion:comparative ads attempt to get consumers tobelieve that the sponsoring product is better. Although these are frequently disliked byAmericans, they intend to be among the most effective ads in the U.S.comparativeadvertising is illegal in some countries and is considered very inappropriate culturally insome societies, especially in Asia.Fear appeals: try to motivate consumers by telling them the consequences of not using aproduct. Mouthwash ads, for example, talk about gingivitis and tooth loss can result frompoor oral hygiene. It is important, however, that a specific way to avoid the feared stimulusbe suggested directly in the ad. thus, simply by using the mouthwash advertised, theseterrible things can be avoided.Classical conditioning: a more favourable brand image can often be created among theconsumer when an association to a liked object or idea is created. For e.g., an automobilecan be paired with a beautiful woman or a product can be shown in a very upscale setting.Humour Appeal: the use of humour in advertisements is quite common. this method tendsnot to be particularly useful in persuading the consumer.however,more and moreadvertisers find themselves using humour in order to compete for the consumer’sattention.often,the humour actually draws attention away from the product-people willremember what was funny in the ad but not the product that was advertised. Thus, for adsto be effective, the product advertised should be an integral part of what is funny.Repetition: whatever specific objective is sought, repetition is critical. This is especially thecase when the objective is to communicate specific information to the customer. Advertisingmessages, even simple ones are often understood by consumers who have little motive to
  6. 6. give much attention to advertisements to which they are exposed. Therefore, very littleprocessing of messages is likely to be done at any one time of exposure.Celebrity Endorsements: celebrities are likely to increase the amount of attention givento an advertisement. However; these celebrities may not be consistently persuasive. Theelaboration likelihood model discussed below identifies conditions when celebrityendorsements are more likely to be effective.DAGMAR:It means Defining Advertising Goals for Measuring Advertising Effectiveness. It was putforward by Russell H.Colley.Dagmar tells that advertising has to perform a particularcommunication task and the task has to be accomplished among a well defined audiencewithin a specified period of time. Following are the steps,Awareness: an individual starts at some point by being unaware of a brand’s presence inthe market. The initial communication task of the brand is to increase consumer awarenessof the brand.Brand Comprehension: Knowledge about the product or the organization is necessary.This can be achieved by providing specific information about key brand attributes. Inattempting to persuade people to try a different brand of water, it may be necessary tocompare the product with other mineral waterproducts and provide an additional usagebenefit, such as environmental claims. The ad of Ganga mineral water, featuring Govinda,which banked on the purity aspect. They related the purity of the water with that of riverGanga.Conviction: By creating interest and preference, buyers are moved to a position wherethey are convinced that a particular product in the class should be tried at the nextopportunity. To do this, audience’s beliefs about the product have to be moulded and this isoften done through messages that demonstrate the product’s superiority over a rival or bytalking about the rewards as a result of using the product. For e.g., many ads like ThumbsUp featured the reward of social acceptance as ‘grown up’. It almost hinted that those whopreferred other drinks were kids.Action:involves some move on the part of the buyer, such as trying a brand for the firsttime, visiting showroom or requesting information. For eg, Tupperware, Aqua Guard, arefamous in Indian cities as a result of its personal selling efforts.Concept of DAGMAR: A Communication Task : A specific Task:Measurable Task : To indicate exactly what appeal or image is to be communicated and tospecify the measurement procedureBenchmark : it’s a standard or a point of reference which can be used to determine thesuccess or failure of an ad campaign. President Lincoln has been quoted as saying, “If wecould first know where we are & whither we are tending, we could better judge what to doand how to do it.” Benchmarks can suggest how a certain goal can best be reached.
  7. 7. Target Audience: it’s important to define the target audience.e.g. When a new brand offashion garments are introduced, a common consumer will respond much differently ascompared to a consumer who maintains a certain lifestyle.Time Period : in setting advertising objectives time period should be specified within whichthe objectives must be achieved. The time period can range from a few days to a year ormore. Most of the ad campaigns specify time periods for a few months to a year dependingupon the situation and type of response expected.Written Goals : Finally, goals should be committed to paper.Limitations of DAGMAR :Sales Oriented Performance : DAGMAR approach is considered to be successful if thesales increase and it is considered as a failure if increase in sales is not achieved.Partial Assessment : the DAGMAR approach assesses the impact of ad campaign in aquantitative term, it does not explain how to improve qualitative representation.Unsuitable to Small Advertising: only large advertisers with financial stability canallocate funds to collect the information. Small firms cannot afford to do it.Non-Comprehensive Study : it is not necessary that a consumer will go through the pre-defined steps in the response hierarchy model before deciding to buy, he may haveimpulsive purchaser.DAGMAR does not explain impulsive purchaser.PRACTICAL ANALYSIS.On Bajaj PulsarBajaj Pulsar is a motorcycle brand owned by Bajaj Auto in India. The two wheeler wasdeveloped by the product engineering division of Bajaj Auto in association with motorcycledesigner Glynn Kerr Tokyo.For our practical analysis we met Mr.Atul who is the Supervisor of Repairs and Service atthe Pulsar showroom in Vasai west.Currently there are four variants available -with engine capacities of 135 cc, 150 cc, 180 ccand 220 cc. previously it was also offered with 200 cc DTS-i oil cooled engine, which nowhas been discontinued. Pulsar is the leader in the 150 cc segment in India with a marketshare of 43%. Before the introduction of the Pulsar, the Indian motorcycle market trend wastowards fuel efficient, small capacity motorcycles (that formed the 80-125 cc class). Biggermotorcycles with higher capacity virtually did not exist (except for Enfield Bullet)In past ten years pulsar has grown tremendously from spoke rings to alloy wheelsFrom kick starter to self electric starterFrom carburettor to fuel injection according to the demand of market and customerPulsar 220 is highest selling sports bike in IndiaThe upgraded version of pulsar to 250 300 and 350 cc to be launched in collaboration withEuropean bike company KTMBajaj is already exporting pulsar to Middle East Asia, Sri Lanka Nepal and with collaborativename of Kawasaki it distributes in Thailand and MalaysiaAnd targets the customer of china and Brazil in global market.
  8. 8. Places of Manufacturing.Bajaj has its main manufacturing unit in Pune in Maharastra. it has manufacturing units inother parts of India alsoBajaj has its authorized showrooms and factory shops with proper service center E.g.Suryoday Bajaj Vasai. Sai service boriviliMarketing StrategiesPersonal Selling: Personal selling is main source of marketing in showrooms by theemployees.Advertisements: Bajaj advertise on television media and press media regularly and isknown for its advertisement in the industry.Press Release: Press release is regular about pulsar as and when any new news or newlaunch in pulsar variants occurs.Main Focus : Bajaj has its main focus on its R&D Department because of which every nowand than the product gets better with quality.Bajaj has proper R&D department because of which a brand like pulsar which is 10 years oldis still strong competitor in market for other bikesCompetitors :Pulsar is known as its own competitor because it has bike from low 135 cc tohigh 220 cc engines so customer has wide choice to suit his/her requirement. Pulsar is thebest known Brand and Quality Product in the Automobile Industry when it comes to Bikes.