hero honda and rural market


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hero honda and rural market

  1. 1. HERO HONDA Initiative towards Rural Market, India BY-NaveenYadav
  2. 2. • “Hero” is the brand name used by the Munjal brothers in the year 1956 with the flagship company Hero Cycles. • It is a joint venture between India's Hero Group and Honda Motor Company. It established in 1984 as the Hero Honda company, India. • During the 1980s, the company introduced motorcycles that were popular in India for their fuel economy and low cost.
  3. 3. "The majority of India lives in rural areas and the government is pumping in a lot of money through various programmers. Hero Honda is focusing a lot on rural markets. Going forward, a substantial industry growth is expected to come from these markets.” - Pawan Munjal, MD and CEO, Hero Honda Motors Limited, in May 2009
  4. 4. GROWTH STRATEGIES Concentrating On Rural Market • Fuel-efficient Vehicles With Low Maintenance
  5. 5. ADVERTISEMENTS TVC ADDS….! Radio ….! Magazines…! X-change melas
  6. 6. Adds……!
  9. 9. • 1,00,000 of 6,00,000 villages in country. • Penetration in Rural Market- 10% • 500 Sales Representatives to meet potential customer (local people as sales executives ) • Average of 16000 bikes per month. ( sales ) Contd………!
  10. 10. CONTD…..! These representatives have been given work tasks and not sale targets - they need to meet potential customers and opinion leaders in villages. To strengthen their network in rural areas, the company started sales, servicing and spare part outlets in small towns and
  11. 11. FOCUSING ON UPGRADING THE MODELS The most successful product is SPLENDOR in rural market and the company kept on focusing on upgrading the models so, then they later came up with SPLENDOR PLUS and SPLENDOR NXG, which provided extra features and the consumers were satisfied.
  12. 12. COLLECTION OF DATA Under the rural vertical, they started collecting a lot of data at rural touch points; many of their dealers are now meeting, -SARPANCHES, -HEADMASTERS, -AANGANWADI - WORKERS and other opinion makers to understand the rural consumer better.
  13. 13. THE COMPANY CONDUCTS, SKITS DRAMAS To give some social message and attract the crowd and Advertise its products………..!
  14. 14. Once you earn the villagers loyalty (and they are known for their brand loyalty), it will be difficult for competitors to take away your customers. Conted…….
  15. 15. INTEGRATED RURAL DEVELOPMENT CENTRE Centre has been set up on 40 acres of land along the Delhi- Jaipur Highway. The Centre-complete with wide approach -ROADS, -CLEAN WATER, -AND EDUCATION FACILITIES for both adults and children The Foundation has adopted various villages located within vicinity of the Hero Honda factory at Dharuhera for integrated rural development.
  16. 16. CHALLENGES ….. The rural consumer values old customs and tradition. They do not prefer changes. The Infrastructure Facilities - Roads, - warehouses, - communication system, - financial facilities are inadequate in rural areas. - Physical Distribution bacame Costly
  17. 17. CONTD The price its competitors are also becoming the threat. For example: bajaj auto’s platina is priced at 38,115. The literacy rate is low in rural areas as compared to urban areas. This again leads to problem of communication for promotion purposes.
  18. 18. Limited Dealership :- The dealerships in rural areas is limited because of which the customer has to go to near by city to buy the product. Spare Parts :- of Hero Honda are costlier than other companies spare parts, so there is problem for rural people to afford.
  19. 19. WHY COMPANY CHOOSE RURAL MARKET Hero Honda has worked out a major expansion strategy for the rural markets and is planning to strengthen retail financing to support the initiative that could lead to setting up of its own finance arm. Pawan munjal, MD of Hero Honda, told TOI that rural market would be a special focus area for the company as it is looking at new growth areas to maintain sales momentum in a shrinking market. "We have created a special ‘rural vertical' to push growth and this would spearhead our expansion in the rural market,' Munjal said.
  20. 20. CONTD India's largest two wheeler company Hero Honda Motors is spreading its wings to capture the commuting bikers' imagination in rural India, after witnessing flat sales growth in 2007-08. The two wheeler market leader plans to cover 100,000 of the 600,000 villages in the country by the end of this financial year under a campaign named Har Gaon, Har Aangan (every village, every household).
  21. 21. CONCLUSION Most of the Hero Honda Bikes are purchased by young generation 18 to 30 because they prefer stylish looks and rest of the models of Hero Honda are purchased more by daily users who needs more average of bikes than looks. Hero Honda is considered to be most fuel-efficient bike on Indian roads. Service & Spare parts are available throughout India in local markets also.
  22. 22. CONTD While buying a motorcycle, economy is the main consideration in form of maintenance cost, fuel efficiency. Hero Honda started growing in rural market rapidly with its add campaign and promotion strategies in rural market.
  23. 23. Thank You..!