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Honda (A)
Section 3 Group 8
- Anjali Chandra
FT173012
- Devang Singh
FT173026
- P I Isaac
FT173040
- Mrinal
FT173054
- Rajalakshmi M
FT173068
-
Hondas strategy in US
Honda followed a strategy of penetrating market region by
region and lined by 125 dealers across.
Honda used productivity based cost advantage and R&D
capability to introduce new models at lower prices than their
competitors.
Hondas primary objectives are set in terms of sales volume
rather than profitability.
Annual targets were based on market share & strategy was
to grow sales volume faster than any of the competitors.
Products are redesigned whenever market threat or
opportunity is perceived.
Prices are set to achieve market share targets.
Effective marketing systems were set up in all markets.
SWOT Analysis of
Honda
Strengths
- Offer multiproduct line
- Leadership in product
innovation
- Exploit opportunities for
economies of mass production
-- Relatively inexpensive
Japanese labour.
- Exploit the capability of
domestic as well as
international markets.
- Proper use of sales and
distribution channels.
- Quick response to any market
threats.
Opportunities
- Designing products to
meet domestic demand.
- Opportunities to explore
new product designs
(Cruiser).
Weakness
Threats
- Easily replicable
technology developments.
- Threat of foreign players.
Less focus on domestic
market- 59% decrease in
domestic sales
Porter 5 Forces
Supplier Power (low)
Thre
at of
Plenty of suppliers in
New
the market. Honda
buys from multiple
Entry
Competitive
suppliers
Rivalry
Competitive
Rivalry
Suppliers
Need constant
Power
innovation,
research
Substitution (low)
(High)
Threa
People can move from
t of
two wheelers to cars ,
Subst
trains and buses but they
itutio
are less convenient and
n
do not serve the purpose.
Threat of New
Entry (Low)
Huge initial
Investment
needed. Not
possible to easily
disrupt the
market.
Brand loyalty
Buyers Power
amongst
customers
Buyers Power (High)
No. of respected
brands in market
ranging from
American and
European to Japanese
manufacturers
Recommendations