MARKETING PLAN FOR METRO BIKES COMPANY WHO WISHES TO LAUNCH NEW PRODUCTS IN USA MARKET WITHIN THREE YEARS

1. MARKETING PLAN FOR METRO
BIKES COMPANY
PRESENTED BY GROUP NO. 8
JAPPREET S. BHATIA
ROHIT YADAV
DEEPAK JAIN
DSB, VIPS-TC
PGDM 2014-16

2. CONTENTS
• Part: 1 Executive Summery
• Part: 2 Key Objectives
• Part: 3 Situational Analysis
• Product Market Analysis
• Distribution Analysis
• Competitor Analysis
• Other Analysis
• Part: 4 Strategy and objective
• Marketing strategy
• Marketing objectives
• Part: 5 Marketing Mix
• Market
• Product
• Promotion
• Distribution
• Pricing
• Part: 6 Financial analysis Budget and analysis
• Part: 7 Marketing Research and Risk analysis
• Part: 8 Contingency Plan

3. EXECUTIVE SUMMARY
• Indian Bicycle Industry is very large with India
producing almost 10% of total Bicycle production of
the world and exporting around Rs. 200 million of it.
Out of the complete sales of bicycle, around 13% is
constituted by the kids segment with CAGR
(Compounded Annual Growth Rate) of around 20%.
• With many brands present in the bicycle industry, a
new approach towards marketing is needed and also
to penetrate competitive market cost competitiveness
is required.
• This report explains the Marketing plan for launching
bicycles named as “Metro Bikes “ by exporting it in
USA in coming three years.

4. KEY OBJECTIVES
• Continue to provide the high quality of sales and
services.
• Maintain a financially healthy business and validate
the trust and advocacy of other people in support of
this business purchase.
• Achieve monthly and yearly sales equal to or better
than the previous year .
• Aim to improve sales of bicycle specific garments
and rainwear over the year.
• Focus marketing on new student influx to maintain
current growth in sales and service revenue.

5. SITUATIONALANALYSIS
• We feel that Abbot Ville's demographic characteristics
and location make it an ideal place to open a bicycle
shop. The city has a large population of children and
young adults, segments of the population that are
heavy users of bicycles.
• Also, with a large state university only one mile
away, we expect to attract a number of college
customers. Abbot Ville has a population of
approximately 31,473, with a median age of
36. However, Metro Bikes will consider the 145,917
people in and surrounding Abbot Ville as part of its
overall target market

6. MARKET ANALYSIS
• The U.S. bicycle industry was a 6$ billion industry in
2005 (this includes the retail value of bicycles, related
parts, and accessories through all channels of
distribution), selling approximately 19 million bicycles.
• Bicycling is an excellent cardiovascular exercise and a
great stress reliever.
• A recent industry trade publication showed that 94.5% of
those who ride bicycles do so for recreation or
fitness. The sport is continuing to grow as more and more
people become aware of its health benefits.
• The Bicycle industry and Metro bikes in particular, is
positioned to cash in on this trend.

7. MARKET ANALYSIS CONTD...
• Metro bikes is a specialty bicycle retailer featuring
high quality merchandise, and also offering additional
customer services such as bike fitting, expert
assembly, and repair.
• The industry is a seasonal business that can be
impacted by poor weather conditions, as well as
changes in the economy.
• Additionally, high oil and gas prices have increased
the demand for bicycles nationwide as people look
for more affordable means of transportation.
• Approximately 5.2% of those who ride bicycles do so
as a means of transportation.

8. STPANALYSIS
SEGMENTATION
TARGETING
POSITIONING

9. TARGET MARKET
The profile of the Metro bikes customer consists of
the following geographic, demographic,
psychographic, and behavior factors:
• Geographic
• Our immediate geographic market is the Abbot Ville
area, USA with a population of 31,473. However, we
will include the 145,917 people that make up the
major population surrounding Abbot Ville, as part of
our overall target area.

10. DEMOGRAPHICS AND
PSYCHOGRAPHICS
• Demographics
Our general target market is male and female age 6-65, but we
have segmented our market into two smaller and more
identifiable groups:
• 1. Families with children that have an average income of
$35,000 or higher
• 2. The avid rider, male and female, age 21-44 with an average
income of $45,000 or higher
• Psychographics
• Health and fitness is a priority
• Enjoys being outdoors and staying physically active

11. BEHAVIOURS
• He or she reads one or more of the following magazines:
• Sports Illustrated, Mountain Biking Weekly, Biking for the
Family, Serious Cycling
Behaviors
• Regularly shop at sporting goods stores
• Enjoy reading the sports section of the newspaper
• Shop at high end retailers with higher quality
merchandise
• Watch sports on TV and listen to sports radio
• Works out at local gym or health center

12. SEGMENTATION
• The Indian bicycle market comprises two segments:
“standards” and “specials”. Standards are the
workhorses of the rural economy. These cheap and
rugged bicycles have remained unchanged for
decades. The specials or “fancy” segment comprises
new generation bicycles, which are more expensive.
Differentiation is the name of the game here.

13. POSITIONING
• Metro Bikes Co.’s location, atmosphere and activities
position it as the only bike shop in town who takes
care of the students. Through discount programs,
student financing, recycled packaging, sales
promotions and colored employee shirts in the
university colors, Metro Bikes Co. will succeed in its
endeavor .
• On a global level, Metro Bikes Co. distinguishes
itself from the competition by providing a full service
bike shop with expert sales staff, along with the most
technologically advanced bicycle offerings.

14. PORTERS’ANALYSIS OF
BICYCLE INDUSTRY
Rivalry among Existing Competitors
• Main competitors include Hero Cycles, Firefox, Atlas Cycles
• It has long history and established significant market size
• Increasing rivalry expected as more firms enter the attractive market (both domestic and foreign import).
Threat of New Entrants
• Expectation of long term demand for bicycles for kids segment remain strong
• However, increased competition into the market from imports from the China makes it less profitable for
new entrants
Threat of Substitutes
• Kids Bicycles are common and range in prices

15. PORTERS’ANALYSIS OF
BICYCLE INDUSTRY
• Different styles and makes are widely available through many outlets
• Alternative recreational equipment widely available
Bargaining Power of Buyers
• Buyers demand depends on discretionary income for recreational equipment
• Variety of distribution channels
• Higher income households comprises a major portion of the market
• Buyers demand depends on level of real disposable income and health of household
Bargaining Power of Suppliers
• Primary Assembly unit is located in Ludhiana so the supplies of raw materials in assembling the
cycles take less time.

16. SWOT ANALYSIS
STRENGTHS
• Biking is a simple, low-impact means of exercise,
which people of all ages can enjoy
• Provides excellent customer service including: bike
fittings, training and instruction on proper use, safety
tips and repair
• Sells a wide variety of bicycle accessories and parts
THREATS
• online bicycle sales as well as catalogue sales and
service
• Price pressure from mass merchants and large discount
chains
• Fluctuations in the economy that affect discretionary
spending

17. SWOT ANALYSIS
WEAKNESSES
• Prices are relatively high
• Challenges of the seasonality of the business
• Access to Capital
OPPORTUNITIES
• Increasing trend of active lifestyle
• Area is experiencing population growth
• Local university located 3 miles from retail store

18. COMPETITOR ANALYSIS
• The domestic bicycle industry is oligopolistic in nature,
dominated as it is by three organized players: Hero
Cycles Limited (Hero), Tube Investments of India
Limited (TI) and Atlas Cycles (Haryana) Limited
(Atlas). These players account for over 90% of the
country’s total bicycle sales.
• Fringe players include Avon Cycles and Hamilton.
While TI is the clear market leader in the specials
segment, Hero, which is also the largest bicycle
producer in the world, is a clear leader in the standards
and in the overall domestic market.

19. MARKETING OBJECTIVES
• As we are a new company, Metro Bike’s first
marketing objective will be to get information about
our products and services out to our customers.
• Our second objective will be to develop strong brand
name recognition and loyalty among these
customers.
• Our third marketing objective will be to increase
yearly sales by 5%.
• Our marketing strategy is based on becoming the
resource of choice for local bicycle users.
• Our strategy is based on superior performance in the
following areas: product selection, product quality,
and customer service (including repairs and tune-
ups).

20. MARKETING STRATEGY
Our marketing strategy seeks to optimize our
advantage of prime location We want customers to
see us as part of their daily experience, and a shop
they can depend on for quick repair and maintenance
service.

21. PRODUCT STRATEGY
• Product Strategy- Metro Bikes Co. will sell two types
of high quality and high performance bicycles:
1) Comfort bikes geared toward the recreational user,
2) Youth bikes for kids 6 and older.
Metro Bikes Co. will carry 5 brands of bicycles: Trek,
Specialized, Giant, Raleigh America, and Hero Bikes, all
of which are top sellers in the specialty retail market

22. PRICING AND PLACE
STRATEGY
• Pricing Strategy-
• Product and service pricing is based on offering high value to our
customers.
• The price range for tune-ups and repairs will vary accordingly, but
the following is a list of price ranges for our two types of bicycles:
• Comfort - $150 to $500
• Youth - $125 to $400
• Place/Location Strategy-
• All products will be distributed through the retail store located at the
corner of heavily traveled Main Street and Bourne Avenue in
downtown Abbotville.
• All repairs and service will be provided at this location.
• However, we will create a website for our business that will allow
users to contact the store and view our complete list of products and
services.

23. PROMOTION STRATEGY
• Promotion Strategy- We will market our business using
the following mediums: television, radio, and
newspaper advertisements, business website, printed
promotional materials.
• Our television and radio advertisements will be aired on
local stations.
• We will place newspaper advertisements in two of the
local papers and the local university’s paper.
• Our website will be up and running by opening day.
• We will also utilize print advertisements such as fliers
and post cards to promote special sales events.

24. DISTRIBUTION CHANNELS
• Bicycle sales are accomplished in this country through
five primary and distinct channels of distribution —
specialty bicycle retailers, mass merchants, full-line
sporting goods stores, outdoor specialty stores, and
"other," which is comprised of a mixture of retailers
(including Internet sales).
• Department, discount and chain toy stores (mass
merchants) sell mostly price-oriented products.

25. FINANCIALS/BUDGET PLAN IN
Rs.
• Research Costs Total 378002.00
• Communications Costs Total 641250.00
• Networking Costs Total 6350.00
• Promotions Costs Total 557500.00
• Advertising Costs Total 369100.00
• Public Relations Costs Total 160000.00
• Meal Costs Subtotal 37950.00
• List Service Costs Subtotal 77700.00
• Audio/Visual Services Subtotal 17870.00
• Additional Costs Subtotal 21695.00
• ESTIMATED MARKETING GRAND 22,67,417.00
•

26. MARK UP PRICE
• MARK UP PRICE
• Market Suggested Retailer Price $.480.00
• Retailers Mark Up Price (25%) $.120.00
• Wholesaler Price $ . 300.00
• Manufacturers Mark Up Price (10%) $ .25.00
• Manufacturers Cost $ 250.00
• Total Investment = $ 2,50,0 0,000
• Total Production in One Year = 1, 00,000 Units
• Fixed Cost = 40% of Investment = $ 10,00,000

27. MARKETING RESEARCH
• As part of their philosophy of listening to the
consumer and serving their needs, Metro Bikes
Co. will conduct a survey on campus asking
students questions about their biking
preferences, how often they ride, why they ride,
and what appeals to them when choosing a bike
vendor.
• These questions should help the Metro Bikess Co.
gain a better understanding of the concerns and
attitudes of the student market

28. RISK ANALYSIS
• The first risk is competition with HERO Bikes and
ATLAS Bikes and others.
• Another risk is the possibility of the expansion plans
being delayed.
• One last risk is the possibility of a new parking deck
being built on campus within the next school year.
This deck would significantly reduce the parking
restrictions placed on the freshman population. If
the proposal for this deck is approved and built, the
concept of segmenting the student market to focus
on freshmen will no longer be valid.

29. CONTINGENCY PLAN
Single
Segment
Targeting
Other
Segment
Diversifying
Worldwide

30. REFERENCES
• Philip Kotler- Marketing Management
• Business Plan Generation Model
• Google
• www.entreprenuership.com
• www.bplans.com
• www.Canvasbm.com

31. THANK YOU