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Arindam Chaudhuri, Editor-in-Chief, 4Ps B&M Editor-in-Chief
Dr. Arindam Chaudhuri
A.Sandeep Editor's Desk
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Now for The High Fliers
India’s Favourite Small Car Manufacturer is the envy of a Bevy of Premium and Luxury Players. But now Maruti Seeks to get into The Luxury Segment itself with The Kizashi. Is it The Right way forward?
Issue Date - 10/03/2011
The first campaign from its stable was done by Hindustan Thompson (now JWT) in 1989 for the Omni, which aimed at positioning the car as a passenger vehicle. The company found that the looks and size of the product were giving it a rather commercial appeal. While the campaign, which was shot in the factory premises in Gurgaon, featuring the renowned model Malvika Tiwari, it focused only on the print media. Even then, many in the industry opposed the idea of a marketing campaign; citing it as an unnecessary effort, since there was no practical competitor for the company in the industry. However, Maruti was fully convinced about the potential of the product and didn’t want to take any chance with the same. “It did help in changing the positioning (though partially). Our research shows that 44% of Omni users still use the product for dual purposes (both commercial and personal) while the rest of them are using it for personal purpose,” comments Shashank Srivastava, Chief General Manager – Marketing, Maruti Suzuki India.

Playing in the nervous 90s
The early 1990s did not see any significant issues for Maruti, which brought in the Zen and the Maruti Esteem in the period. GM and Ford did enter, but they were unwilling to commit too much towards India-centric products at that time, and choose to enter with cars like Opel Astra and Ford Escort. In the late 1990s, Hyundai, Tata and Daewoo chose to enter the small car segment and saw instant success, which Maruti sees as only a vindication of its vision. “While almost all auto makers started with the sedan segment, we at Maruti were very confident that the small car segment will grow in times to come,” says R. C. Bhargava, Chairman, Maruti Suzuki.

While Daewoo Matiz made its way to the history books due to the goof-ups at the parent company, Hyundai touched gold with its Santro. “Slots, positions and spots in the Indian automotive industry are very subjective matters to talk about. We are here to create a bigger brand. We are here to create a large pool of satisfied customers and the second slot is incidental,” says Arvind Saxena, Director – Marketing & Sales, Hyundai Motors India.

As it started losing market share steadily, new problems started to surface for Maruti when the issues between the two shareholders evolved into an ugly confrontation. While the process of the exit of the government took two long years in the late 1990s, Maruti was unable to match the pace at which competition was launching new models in the Indian market. “After competition came in and there were issues among partners, the image of Maruti as a technologically superior car maker took a slight hit,” agrees Srivastava. But as soon as it became a subsidiary of Suzuki Motor Corporation, it took little time in giving it back to the competition with products like WagonR, Alto and Baleno.

From Alto to Kizashi
While Alto went on to become the largest selling car for Maruti Suzuki (currently selling close to 30,000 units a month), products like Baleno and Versa that failed to create any ripples in the Indian market. But in 2005, the Swift was launched and the rest was history. The car has sold over 4.5 lakh units in the first five years in the Indian market. “When we made a presentation of selling 5,000 units a month for the Swift, the board laughed at us. Today, it is selling more than 12,000 units a month,” recalls Mayank Pareek, Managing Executive Officer – Marketing & Sales, Maruti Suzuki. He also reminisces that many in the company rejected the initial design of the Swift thinking that it was too bold for the Indian consumer. But what the product did in return was the much required need of the hour.

The Swift also brought young consumers of the 21st century back to the Maruti Suzuki umbrella and worked on changing the pre-existing image of the company as a maker of only reliable and value for money products. “Our research shows that after the Swift, Maruti’s image as a technologically ahead carmaker has improved among the Indian audience. Moreover, products like SX4, Dzire, Ritz and A-Star also attracted a lot of younger Indians into our umbrella,” added Srivastava.

However, the competition in the bread-and-butter segment (small car segment) has seen a multi-fold increase with time. Be it Nissan Micra, Toyota Etios, Ford Figo, Chevrolet Beat or the Indica Vista, the journey has only been tougher for Maruti in the 2000s. Even then, what works for Maruti is the sheer power of the mother brand under which the sub-brands thrive. The company has sold 6,58,002 units in the A2 segment alone in the April 2010-January 2011 period with a market share of 56%. “Corporate campaigns like ‘Papa ki kara’ and the latest ‘Kitna deti hai’ have made the Maruti brand so strong that the sub-brands have a strong backing coupled with the people’s trust,” asserts Sunil Sachdeva, Joint Chairman, Publicis Capital. The only other auto maker that focuses largely on developing its mother brand is Toyota with its Quality Revolution campaign. “We can command a premium in the Indian market because of the trust that people have on the Toyota brand,” affirms Sandeep Singh, Deputy Managing Director – Marketing, Toyota Kirloskar Motors, explaining the importance of the mother brand. With time, Maruti has even worked on developing its brand on the digital marketing space and it today forms a very important part of its marketing activities.

Be it social media platforms like Facebook, Orkut, Twitter or gaming websites like Zapak, Maruti is leaving no stones unturned to ensure its brand growth among the young TG. “The next step for us is to consolidate the digital marketing business under a couple of agencies. Currently, the business is being taken care of by different agencies that are looking at its different aspects,” mentioned Srivastava.

Ever since Maruti tasted the Swift success in the mid-2000s, the company has started to create segments within the A2 segment; market experiments that face mixed reactions from its critics. For instance, while A-Star is targeted at the urban youth, Ritz is made for the executives with nuclear families. Isn’t this akin to inviting a high degree of cannibalisation? “Maruti has been so successful in the Indian market because of its apt understanding of the Indian consumer and its perfect positioning with several models,” argues auto expert Tutu Dhawan.

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