N.L.

DALMIA

INSTITUTE

OF

MANAGEMENT STUDIES AND RESEARC

PROJECT ON

BRAND INDIAN

PERCEPTION

OF

AUTOMOBILES

AMONG CORPORATES

BY

PRASHANT KAMAT PGDBM - MARKETING PMM-116

N.L.DALMIA INSTITUTE OF MANAGEMENT STUDIES AND RESEARCH

CERTIFICATE
This is to certify that the project entitled BRAND PERCEPTION OF INDIAN AUTOMOBILES AMONG CORPORATES Is submitted as per the requirement for the PGDBM course Specialization MARKETING By PRASHANT KAMAT is approved by N.L. Dalmia Institute and has been carried out under the guidance of Prof. V. Wagh.

Prof P.L. ARYA

Director

DR V.WAGH
Marketing professor

ACKNOWLEDGEMENT

It was a pleasure as well as an enriching and educating experience to be exposed the world of Automobile sector during the creation of the project BRAND PERCEPTION OF INDIAN AUTOMOBILES AMONG CORPORATES.I wish to wholeheartedly thank our respected Prof. V. Wagh for guiding me in my project by giving me the essence of knowledge & information, which he has derived from years of erudition & relevant experience. He was the one who gave me the opportunity to work on this project. But for his direction, this project would have been a distant dream. I have tried to incorporate some of the viewpoints that I have garnered from him into this project. I would also like to acknowledge the sincere support of Mrs. Sujata Dsouza & Mr. Yogesh of our library for extending their co-operation to me to gather the project related information.

Last but not the least I would like to thank all my seniors and colleagues & friends who have helped me directly or indirectly in completion of this project

PROJECT CONTENTS
CHAPTER TOPIC No. I Executive Summary II Problem Statement III Research Objective IV Industrial Background Brand Perception of B & C V Segment Conclusion & Recommendations VI
XII

APPENDIX Questionnaire

EXECUTIVE SUMMARY:

The survey is to find out which is the most important factor for corporate in deciding the brand perception and buying behavior for cars. Whether

people in the Administrative team involved in purchasing of cars for their organization gave more priority to price than performance. The survey is also find out whether in todays competitive situation the final purchase of cars could boil down to the after sales service and features provided by the manufacturer. Whether general buyers and Corporate stress on same parameters in their purchase of cars. Based on the above findings manufacturers can take in to account in future all such parameters which lead to brand building.
PROBLEM STATEMENT:

Manufacturer can find it difficult to know the exact problem regarding unacceptance of their previous brand .what could be the reasons for their sluggish sales and hence market share.

RESEARCH OBJECTIVES: TO MEASURE BRAND PERCEPTION OF CARS AMONG CORPORATE Brand Image of a company is vital for the short term as well as long term success of the company. It is therefore necessary to identify the exact Brand Image of the Company in the corporate sector, since the image could vary between the corporate users and general users. Also since Corporate are bulk buyers of vehicles it is obvious that Brand Equity would command a major role in their decision making.

IMPORTANCE OF THE STUDY:

Manufacturer can take in to consideration all such parameters in the design of a car where features would be perceived as benefits. This in turn would result in brand building.

Give suggestions on the new product features which corporate perceive as benefits.

RESEARCH DESIGN: Measure the Brand Perception of cars among Corporate.

To find out the factors Corporate take into account while buying

cars.

Use of EXCEL package for analysis

EXECUTIVE SUMMARY OF INDIAN AUTOMOBILE INDUSTRY:

The Indian Passenger Car market has undergone interesting transformation in the past fifty years. In the forty years since Independence the Indian passenger car Industry had seen very little activity and the consumer choice was restricted to only very few models. The government took a major initiative to introduce a new player to the Indian customers when it entered in to a joint venture with Suzuki Motors of Japan in 1983. Even then, the government ensured that it had the majority stake of 76 percent in the company, lest its control over the passenger car market would decrease. Maruti was a success story in India and people, who had been bored of the two bland models of Ambassador and Padmini, readily opted for the new model at a lower cost. Thus, Maruti emerged as the true peoples car. From 1984 to 1998, Maruti Udyog limited enjoyed a dominant position in the Car market with a market share of 82 percent. The government decided to deli censes the Passenger Car sector in 1993. Thus the market again underwent a major upheaval when the Korean, German, Japanese, American MNCs started flooding the market with various models in all possible price segments. All of a sudden, the market was flooded with models of various size and prices. This greatly enhanced the choice of the consumers. But the large number of models did not lead to a corresponding increase in the demand for cars, and hence in the present

situation the Indian Car market is afflicted with overcapacity. This is not hindering the MNCs from entering the Indian manufacturing unit as their Export base.

It will really be interesting to closely watch the changes that are going to take place In this sector in the next 10 years. The future looks as if there will be major shakeouts in the Passenger Car market.

PRESENT SITUATION: CATEGORY A SEGMENT B SEGMENT C SEGMENT MODELS MARUTI 800 PALIO, SANTRO, INDICA, ZEN, ALTO ESTEEM, SIENA, ACCENT, IKON, ASTRA, CORSA, BALENO, CITY, PREMIUM SEGMENT LUXURY SEGMENT LANCER, OCTAVIA SONATA, ACCORD, BENZ, MONDEO,

INDUSTRY STRUCTURE:

The Indian car Industry can be classified based on the price of the car, which is shown below in the table. One of the things to note here is that the models shown below have many variants, which can result in overlapping across segments. This Segmentation is done according to Prices of basic models.

POLICY ON PETROLEUM PRODUCTS, AUTO EMISSION AND DEPRECIATION:

The price of Petrol and Diesel was regulated until recently by the government as part of its policy on petroleum products management. This dismantling of the Administered price Mechanism (APM) of petroleum products will reduce the cost disadvantage of Petrol driven Cars. On the vehicle Emission front, judicial activism has goaded the government to take certain policy measures in the recent past, which has led to stricter Emission norms for Automobiles. As a result, all existing players and new entrants have started introducing models with Fuel Injection system to meet Euro2 norms. This development has led to an increase in the Prices of Cars, which by an estimate, could be anywhere between 10-15%.

The Depreciation norms have effect on demand for cars as corporate purchase cars for use by managerial staff and claim depreciation in their books. With this the companies are benefited from tax shelter provided by depreciation.

HISTORICAL INDUSTRY DEVELOPMENT:

The Beginning: The Car Industrys history dates as back as late nineteenth century but we can say that Henry ford founded the Real car Industry when he started Ford Motor Co. in 1903. Before that, cars were fussy, unreliable, costly novelties. Fords genius was to make them simple, solid and inexpensive necessities took place in 1913 when ford built an Assembly line, which was the first example of Mass Production. The second honorable mention in shaping the Car industry is of Alfred P Slogan Jr. the chairman of General Motors from 1923-1946

AN OVERVIEW OF THE CORPORATE PERCEPTION OF THE B AND C CLASS SEGMENT CARS.

METHODOLOGY ADOPTED: The respondent was asked to give scores out of 10 (10 being the highest) to different parameters like price, performance,

features, safety, esteem and serviceability. After the entire survey, an average was carried out to arrive as to how cars scored in the above parameters.

A] ON A SCALE OF 1-10, SCORE THE FOLLOWING PARAMETERS- C SEGMENT

Vehicle

Ford Ikon

Fiat Siena

Hyundai Accent

Maruti Esteem

Parameters Performance Features Price Esteem Serviceability Safety

FINDINGS OF THE CORPORATE PERCEPTION FOR C CLASS SEGMENT CARS.

FORD IKON:
7.95

FORD IKON
7.65 7.4 7.6

8 7.8 7.6 7.4 7.2 7 6.8 6.6 6.4 6.2

7.35

6.9

Performance

Features

Price

Esteem

Service

Safety

Ford Ikon was perceived very well on all parameters considered by the corporate. Though it did not finish first in this category, loosing very slimly to Hyundai Accent, it did manage to get an edge over its rival on the most important Performance parameter. On a score of 10 Ford Ikon crossed the 7-figure mark on all parameters, which is good. On the Price parameter too it was perceived as a good car to go in for bulk Purchases. Ford Ikon was thus a good bet for corporate car purchases.

FIAT SIENA:

FIAT SIENA

8 7.75 7.5 7.25 7 6.75 6.5 6.25 6 Performance Features Price Esteem Service Safety 6.55 6.6 6.35 6.25 6.9

5.85

Fiat Siena was perceived badly on almost all parameters considered important by the corporate. Except the safety parameter where it managed to just touch the 7 level mark, its perception was average and bad if compared with its rivals. Price perception was also poor and it was perceived as More Money Less Value. Amongst all the parameters, the worst perception was that of serviceability thus reflecting the low CSI of FIAT. Overall, Fiat Siena was the last choice among all the cars considered in the C class segment.

However, the good news for FIAT is that majority of the respondents gave scores keeping the old Siena in mind. With the new Siena being launched, backed by heavy marketing initiatives and reduced prices things could just change for FIAT.

HYUNDAI ACCENT:

HYUNDAI ACCENT 8.2 7.85 7.5

8.2 8 7.8 7.6 7.4 7.2 7 6.8 6.6 6.4

8.1 7.75

Performance

Price

Service

Hyundai accent emerged as the clear leader in this survey. It bagged the top preference on almost all parameters considered important for the survey. In price too it was the most preferred car for the C class segment cars. This is extremely good considering the fact that corporate purchases give the most importance to this parameter. In all parameters, it crossed the 7 level mark. In the Esteem parameter, it managed to cross the impressive 8 level mark indicating that executives who give importance to this parameter would most likely select this car.

Overall, the Hyundai Accent was the best-preferred car in this segment for corporate purchases.

MARUTI ESTEEM:
MARUTI ESTEEM

7.95 8 7.8 7.6 7.4 7.2 7 6.8 6.6 6.4 6.2 6 Performance Price Service 6.65 7.1 6.8 7.45 7.05

Maruti Esteem had a decent perception in the corporate world. Though it did not cross the 7 level mark in all parameters, loosing out in features and esteem parameters, it did manage to

out beat all its rivals in the price and service features. The high CSI was thus reflected when corporate give more scores to the service parameter.

Overall Maruti Esteem was a black horse where none of its rivals could afford to ignore it.

FINDINGS OF THE CORPORATE PERCEPTION FOR B CLASS SEGMENT CARS.

TATA INDICA:
TATA INDICA

8 7 6 5 4 3 2 1 0 Performance Features 6.25 6.25

7.25 5.8 6.1 6.25

Price

Esteem

Service

Safety

Tata Indica had a bad perception in the corporate world in comparison to its rivals. Except the price, parameter where it managed to cross the 7 level mark it lost out in all other parameters. In the esteem parameter, it was the least preferred car compared to its rivals. It finished out with an average score of 6.31. Thus, its only silver lining was its good perception in the price parameter.

FIAT PALIO:

FIAT PALIO

9 8.8 8.6 8.4 8.2 8 7.8 7.6 7.4 7.2 7 6.8 6.6 6.4 6.2 6 5.8 5.6

7.6 7.2 7

7.55

7.45

6.2

Performance

Price

Service

Fiat Palio had a very good perception in the corporate world. Except the service parameter, it managed to comfortably cross the 7 level mark in all parameters. Though it scored badly in the service parameter, there was something very interesting to note for FIAT. Fiat Siena had scored merely 5.8 in service parameter whereas Fiat Palio scored 6.2 in the same parameter. That indicates that the same people gave higher scores to the service parameter of Fiat palio compared to Siena when both of these cars were of the same manufacturer. This can thus be taken as an indication that Palio is increasing the brand equity of FIAT. It also was the first preference in features and safety parameters.

Fiat Palio managed to close with an average score of 7.16, which is extremely good considering the fact that it was the last entrant in the B class segment.

HYUNDAI SANTRO:

7.45

HYUNDAI SANTRO
7.3 7.25

7.6

7.4

6.85 6.8

7.2 6.6 7

6.8

6.6

6.4

6.2

Performance

Features

Price

Esteem

Service

Safety

Hyundai Santro had a decent perception in the corporate world. Though it failed to create any charm in the esteem and service parameter, it managed to cross the 7 level mark on all other parameters. It also was perceived very well when it came to performance, next only to its rival Zen. It also was perceived very well in the features parameters. It finished with an average score of 7.04.

In spite of all these positives it could bag only the Third position in all the B class segment cars considered for the survey.

MARUTI ZEN:
MARUTI ZEN 8 8 7.8 7.6 7.4 7.2 7 6.8 6.6 6.4 6.2 6 Performance Features Price Esteem Service Safety 7 6.7 7.35 7.1 7.85

Maruti Zen was perceived the best in all the B class segment cars. In the top parameters considered by the corporate like Performance and Price, it was the voted as the best choice. In the service parameter it touched the prestigious 8 level mark reflecting Marutis high CSI. It

finished with an average score of 7.33. In spite of being an old entrant in this segment, it has maintained the charm in the corporate world.

There is no doubt that Zen would stand as the best chance for corporate purchases of cars.

BRAND IMAGE OF B & C SEGMENT CARS AMONG CORPORATES METHODOLOGY: To measure the brand equity of Automobile companies three different questions was designed. Each question was designed to sub consciously take out from the respondent the brand image that he thinks of various Automobile companies.

The first question was based on relating the Automobile Company to a particular animal. The respondent was given a choice of seven different animals namely Dog, Fox, Lion, Camel, Elephant, Cheetah and Tortoise. Each animal represented a particular characteristic of a company. Where lion was the leader, Cheetah was taken as a high growth company. Similarly, tortoise was a company with low growth perspective. Respondents who marked dog had high respect for service given by the company (Faithful) whereas people who marked elephant thought the company to have a large product mix but were still not the leader. Fox represented cunning and creative and camel represented a good company in only a particular segment or type of cars. Needless to say, that this was not a thumb rule for people marking a particular animal to a company; a second question was designed to clarify the respondents perception of a particular company.

The second question was based on relating a company to a particular characteristic of human beings. The respondent was given a choice of four different characteristics namely Old person, Settled Person, Young and dynamic, and Eager to please. An old person was related to a dying company or a company with a very low market share. A settled person represented company with a good share in the market but at the same time with low prospects for its market share to increase. Respondents marking young & dynamic held high image for the models produced by the Company. Similarly, eager to please represented good after sales service of the company.

In the third question, the respondent was asked that if given the chance to be a brand ambassador of a particular company which one would he opt for. It was thus obvious that the company marked by the respondent would have a high respect for the company.

3] If you were asked to describe the Automobile Companies which of the following Animals would you often choose? [A] VEHICLE HONDA FIAT MARUTI HYUNDAI FORD TELCO

ANIMAL DOG FOX LION CAMEL ELEPHANT CHEETAH TORTOISE

WHICH COMPANY LIKE OLD MAN SETTLED PERSON YOUNG DYNAMIC EAGER PLEASE TO & IS

HONDA

FIAT

MARUTI

HYUNDAI

FORD

TELCO

BRAND EQUITY OF HONDA

A]

COMPANY-ANIMAL PERCEPTION
Dog Fox

20% 10% 0%

0%

15% 10%

Lion Camel Elephant

45%

Cheetah Tortoise

B]

HUMAN-COMPANY PERCEPTION

0% 25%

20%

Old man Settled Person

55%

Young & Dynamic Eager to please

C] Percentage of People preferring to be Brand Ambassadors for Honda motors: 20%.

REMARKS FOR BRAND EQUITY PERCEPTION OF HONDA MOTORS: Looking at the above graphs it become clear that Honda Motors holds a high Brand equity perception in the corporate world. More then 60% marked it as a lion or a cheetah thereby referring it as a leader with high growth company.

Respondents were quick to mark it as a company, which comes out with young and dynamic models. Others perceived the company as the best for providing after sales service. Also 20% of the respondents preferred to be Brand Ambassadors for this company thereby solidifying the conclusion that Honda has a high Brand Equity in the corporate world. Since it commands a high goodwill in the corporate world, newer and less competitive models would, work more easily compared to its rivals.

BRAND EQUITY OF FIAT PALIO:

A]
ANIMAL-COMPANY PERCEPTION
Dog Fox

15% 15%

5% 30%

10% 5%
Lion Camel Elephant

20%
Cheetah Tortoise

B]
HUMAN-COMPANY PERCEPTION

10%

10% 45% 35%

Old man Settled Person Young & Dynamic Eager to please

C] Percentage of People preferring to be Brand Ambassadors for FIAT: 15%

REMARKS ABOUT BRAND EQUITY PERCEPTION OF FIAT AUTOMOBILES.

FIAT has a low brand equity perception in this survey. Though there was a mixed response from the respondents as far as describing the company to an animal was concerned, but there were actually very few respondents marking it as a lion or a cheetah. There were respondents who marked the company as a tortoise indicating that they perceived the company as a low growth company. A significant chunk of respondents marked it as an old company. Others gave the benefit of doubt by marking it as a settled person. In spite of

a low brand equity perception people in the survey gave good scores to Palio; an indication that Palios success is not because of FIAT but because it is an excellent product.

However in spite of all this, there were a few positive aspects for FIAT. All the existing customers had high respect for FIAT. 15% respondents preferred to be brand ambassadors for FIAT and all of them owned a Palio. One respondent even said After a long time FIAT seems to be in the business of selling cars.

With the new Siena being launched and new marketing initiatives taken by the company, things should change for FIAT in this front.

BRAND EQUITY OF MARUTI SUZUKI.

A]

ANIMAL-COMPANY PERCEPTION
Dog Fox

5% 5% 5% 19% 28%

Lion Camel

19%

19%

Elephant Cheetah Tortoise

B]
HUMAN-COMPANY PERCEPTION

15%

5%

10%

Old man Settled Person Young & Dynamic

70%

Eager to please

C] Percentage of People preferring to be Brand Ambassadors for MARUTI SUZUKI: 25%

REMARKS ABOUT BRAND EQUITY PERCEPTION OF MARUTI SUZUKI:

The survey brought out mixed response from the respondents as they were unclear as to which animal should they mark this company to. This was obvious since it has a large product mix in different categories; each model performing differently than the other. Whereas Maruti 800 and Maruti Zen somewhat rule their respective segments, Maruti versa and Maruti Baleno have been a clear flop.
Even when it came to perceiving the company as a particular characteristic of human beings, a huge chunk of respondents was happy marking it as a settled person. However, 25% of the respondents preferred to be brand ambassadors for Maruti Suzuki, indicating that there were still many fans for this largest automobile manufacturer of India.

Overall, the company had a decent image in the corporate world. However, the company would need more initiatives from its side to improve the Brand Equity of it.

BRAND EQUITY OF HYUNDAI MOTORS:

A]

ANIMAL-COMPANY PERCEPTION
Dog Fox

5% 20% 10% 5% 15%

20%

Lion Camel

25%

Elephant Cheetah Tortoise

B]
HUMAN-COMPANY PERCEPTION

0% 38%

0% 62%

Old man Settled Person Young & Dynamic Eager to please

C] Percentage of People preferring to be Brand Ambassadors for Hyundai Motors: 25%

REMARKS ABOUT BRAND EQUITY OF HYUNDAI MOTORS:

Hyundai Motors commanded a decent image in the corporate world. Respondents indicated the good response of the company by marking it young and dynamic. The remaining was happy with the service provided by the company. This was the only company where not even a single respondent indicated as an old company or a settled company. It is thus clear they

perceived the company to make cars that suite the likes of newer generations. 25% of the respondents preferred to be Brand Ambassadors for Hyundai Motors.
People were aware that it was a newer company in the world scenario compared to its rivals but it easily could give jolts to the top 7s automobile manufacturers of the world. Newer models introduced by this company would be easily considered for the corporate purchases.

BRAND EQUITY OF TELCO MOTORS.

A]

ANIMAL-COMPANY PERCEPTION
Dog Fox

5%

10% 40%

20% 10% 10%

Lion Camel Elephant

5%

Cheetah Tortoise

B]

HUMAN-COMPANY PERCEPTION

10%

5% 40% 45%

Old Man Settled Person Young & dynamic Eager to please

C] Percentage of People preferring to be brand Ambassadors for Telco motors: 0%

REMARKS ABOUT BRAND EQUITY OF TELCO:

Telco Motors had a poor perception in the corporate world. Though there was a mixed response from the respondents as far as perceiving the company to an animal was concerned, respondents indicated the poor perception by marking it is an old person. None of the respondents preferred to be Brand Ambassador for this company, which is a proof of poor perception of the company.

CONCLUSIONS & RECOMMENDED FUTURE MARKETING PLAN

CONCLUSIONS : It is thus clear from the survey that Brand Equity of FIAT & TELCO is low as compared to its other competitors. Though Palio has brought a new rhythm to the companys image, still much needs to be done by the company to improve its Brand Equity. There are a few suggestions on this account.

1. CONCENTRATION ON ITS EXISTING MODELS.

The Company should first concentrate on its existing models. Since each model of the Company requires a huge investment where the gestation period is very high. Although introduction of new models is good for the company to remain ahead in the competition but the

company should first take more measures to improve its financial position. Considering the Indian economy and the current scenario of recession the company should be careful in introducing further new Models in the market for the time being. The Company should increase the sales of its existing models efficient promotional schemes

2. INCREASE ITS DEALER BASE AND AUTHORISED SERVICE STATIONS.

Fiat should increase its dealer base. Currently the Company has only 62 Dealers throughout India which is very low. Also the Company has only 95 Authorized service stations in India. Today in the scenario of increasing Competition; Service and ease of buying has become one of the important distinctions which a customer considers while buying a car. The Company can only achieve this if it increases its dealer base and service stations.

3. SPONSOR HIGH PROFILE EVENTS:

The Company should actively organize and sponsor events where High Profile People are involved. Say the Company could be the main sponsorer in The BEST CEO AWARD or THE FILM FARE AWARDS to name a few. This would further enhance the Brand image of the company and since High Profile people would be involved this could also help to increase sales and effectively introduce new models in the market.

4. INVOLVE ITSELF IN INCREASING SOCIETY WELFARE The company should increase its commitment towards society to increase public image. The company can involve itself for maintenance of major highways and publicize this effectively. Owners of FIAT& TELCO would as a result feel more proud to be in possession of a car that helps the society in large. This would enhance the Brand Image.

QUESTIONNAIRE MEASURING THE CORPORATE PERCEPTION OF AUTOMOBILE MANUFACTURERS IN INDIA.

RESPONDENT DETAILS
Name of the Person:-______________________________________AGE________

Company Name:-__________________________________Designation_____________

Phone Number:-_______________________

5] Do you own a Car

A]Yes

B]No

[B]

Make_____________________Model________________________Year Purchase_______ 1] On a Scale of 1-10, score the following Parameters: C SEGMENT

of

Vehicle

Ford Ikon

Fiat Siena

Hyundai Accent

Maruti Esteem

Parameters Performance Features Price Esteem Serviceability

Safety

Vehicle

Tata Indica

Fiat Palio

Maruti Zen

Hyundai Santro

Parameters Performance Features Price Esteem Serviceability Safety

3]If you were asked to describe the automobile Companies which of the following Animals would you often choose? [A] Vehicle HONDA FIAT MARUTI HYUNDAI FORD TELCO

Animal DOG FOX LION CAMEL ELEPHANT CHEETAH TORTOISE

WHICH COMPANY LIKE OLD MAN SETTLED PERSON YOUNG DYNAMIC EAGER PLEASE TO & IS

HONDA

FIAT

MARUTI

HYUNDAI

FORD

TELCO

8] If you were given the chance to be a Brand Ambassador of an Automobile Company in Bclass Segment, Which Car company would you choose and why? [A] --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------