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Overview:

Automobile industry is one of the largest industries in global market. Being the leader in
product and process technologies in the manufacturing sector, it has been recognized as
one of the drivers of economic growth. During the last decade, well directed efforts have
been made to provide a new look to the automobile policy for realizing the sector's full
potential for the economy. Aggressive marketing by the auto finance companies have also
played a significant role in boosting automobile demand, especially from the population in
the middle income group.

A Nations economy is well known from its transport system. For instant and rapid growth in
economy, a well-developed and well-networked transportation system is essential. As
Bangladeshs transport network is developing at a fast pace, Bangladesh automobile
Industry, specially the two wheeler industry is growing too.

Two-wheeler motorcycle is a popular mode of transport and constitutes one of the leading
and fastest growing industries in Bangladesh. Use of motorcycles is increasing because it is
easy to drive to remote locations. As one of the cheapest transports having longevity and
which is easy to handle and park at any place, the two-wheeler has been accepted by the
people. With increased urbanization, the demand for motor-bikes has been rising. About 80
per cent people live in rural areas as they have to depend on agriculture and farming-
related activities. As part of infrastructural development in the country, an extensive road
network has been developed in rural areas creating opportunities for more trade and
commerce.

There are several companies in Bangladesh competing for the top spot in market share of
motorcycle industry. Among other motor cycle companies, Uttara motors ltd, Atlas BD
(Honda Bangladesh Ltd), TVS auto BD Ltd., Runner Automobiles Limited, Nitol motors,
Rankon Motorbikes Ltd, ACI Motors Ltd and Walton are the frontrunners.

Current Market Scenario:

Market is being dominated by indian assembler due to immense popularity of Indian brand.
India, which is the largest motor cycle market in Asia is already saturated so the
manufacturer are concentrating on the potential market like Bangladesh. Current market
size is assumed to be approximately 250,000 pcs per year which is very low compared to
motor bike market size to population ratio. Bangladesh market is expected to grow to
500,000 by 2018 moreover as high SD is being imposed by government so it is turning out
to be very good investment destination for bike manufacturers. So many popular indian
manufacturer is going in joint venture with local company to set the manufacturing plant in
Bangladesh.
Motor bike market size to population ratio for popular bike market is as below:

18000 0.035
16000
0.030
14000
0.025
12000
10000 0.020

8000 0.015 Market Size ('000)


6000 Population ( Million)
0.010
4000 Ratio
0.005
2000
0 0.000

Current Tentative Market share for Motor cycle in Bangladesh:

Market Share (%)


Bajaj
Runner
9 Honda
31
10 32 TVS
4 Suzuki
Hero
12
19 Yahamaha
10
Walton
Others
Segmentation:

Market segmentation involves dividing a market into smaller groups of buyers with distinct
needs, characteristics or behaviors who might require separate products or marketing mix.
In Bangladesh, for motorcycle marketing automobile companies are segmenting their
market based on all four types of segmenting variables.

Market is segmented on the basis of-

Geographic Segments

Demographic Segments

Psychographic Segments

Behavioral Data Segmentation

Segmentation Segmentation Criteria


Geographic Segments Rural Area
Suburban Area
Urban Area
Demographic Segments According to age base:

Teen Aged (18-20 years)


Adults (20-45 Years)
Middle aged ( 46-65 years)
Retired ( 65+ years)

According to lifestyle:

Student
Professionals
Businessman
Retired

According to Gender:

Male
Female

Psychographic Segmentation Lifestyle: lavish, Middle classed,


mediocre.
Personality/Attitude
Interest
Social Class

Behavioral Segmentation Occasion based


Loyalty
Usage rate
Benefit based

A target market consists of a set of buyers who share common needs or characteristics that
the company decides to serve. For targeting market; mostly ATL (Mass) marketing strategy
is followed here. In some cases several companies also follow the differentiated
(segmented) marketing strategy.

Among these segmentation processes companies are using demographic segments most
frequently and most effectively. Companies are trying to create competitive advantages to
make the position in the customers mind.

The main criteria that attracts the customer are-

Initial cost and fuel economy are highest priority.

Low maintenance costs are desired.

Small entrepreneurs and farmers conduct their business carrying loads.

Small manageable size, low maintenance, and pricing and easy loan repayments.

Sporty/attractive looking bikes.

Target Market:

Motor bikes are most popular among the teenaged and middle aged people, so company
should target the teens and middle aged group to grab the market share. Being a local
manufacturing company we should use our manufacturing strength to grab the market
share.

Product and pricing:

Price is extremely important in todays cut throat market. Price is an important factor that
directly related to its market share and profit margin. To attract a large number of customers
quickly and to win a large market share, we should follow the market penetration pricing
strategy. According to this strategy we should a low initial price to penetrate into the market
quickly and deeply with high quality. After a certain period this product goes to maturity
phase and establish as a brand in the market, then the price to adjust with the competitors'
price. When the products are well accepted by the customers and if the product quality rise,
we may follow the psychological pricing. Under this strategy marketing management
believes that customers usually perceive high priced products as having higher quality.

Product of various models is to be readily available and regular innovation required to


provide the customer with new features to retain the attraction of the customer.

Promotion:

To attract the mass people ATL activities like TVC, Paper ad, RDC, Sign Boards, Bill boards
calendar etc can be provided. But as the people are so busy professionally so BTL activities
need to be performed to remain near the target customer, as we are targeting teen-middle
aged customer, who are either student, professional or business man. So we may arrange
campaign in the different universities to promote our bikes, Road shows on various
occasion, attending on trade fairs and exhibitions, dealer campaigns, valued customer
meet, mechanics meet and various activity can be arranged. To keep the sales force vibrant
special incentives for sales person and dealer can also be deigned. As we are going digital,
so to attract mainly the urban and semi urban customer, digital campaign in Facebook, you
tube can be arranged to create good vibes,

Placement:

The motorcycle distribution mainly depends on the dealers and distributor within the
country. The major distributors interact directly with the companies' sales executives for
purchasing the motorcycle. Then they distribute motorcycles amongst the retailer. In the
marketing channel, companies select the distributors based on demand position, sales-
volume consideration and distributors sales capacity. Companies are having defined
classification of the distributors depending upon his location, area of operation, profile of
business, sales volume, degree of exclusivity etc. In accordance to the classification,
distributor will get the benefit with respect to price (discounting structure) and delivery. A
crucial balancing is also required amongst the distributors in terms of pricing so that big
distributors cannot sale the product at a lower price to small distributors in another location
and in the process disturbing the whole networking concept. But we have our own sales
network established through 42 Walton plazas distributed throughout the country.
Placement should be such that the bikes are available in grasp of the users. For motor bike
industry service and spare parts availability is also another vital issue so spare parts must
also be readily available in the proximity of the customer.
Differentiation Strategy:

Differentiation is the act of designing a set of meaningful differences to distinguish the our
offering from competitors' offerings.

In motorcycle market product differentiation is very difficult because the products are
durable but more or less homogeneous.

Yet companies offer some differentiations of products like-

Design

Features

Performance

After Sales Service

We being a local supplier having local R&D facility we can bring striking changes to retain
the customer pool. And another major factor which is very vital for the customers are after
sales service. Companies provide services to the customers which will be different from the
competitors in some extent. Providing services are replacement of damaged product,
broken spare-parts and ensuring quick supply through own distribution channel. Companies
are providing after-sales-services for bonding and strengthening the Customer Relationship.
For this purpose they use experienced technical team which is generally headed by a
National Service Manager. Every team follows a yearly service calendar. Service teams
ensure warranty. Warranty replacements are made within 48 hours or as per committed
time line. Every automobile company, operating in Bangladesh, has a central workshop to
ensure the after-sales-service to the customers. Being local manufacturer we have an upper
hand in this regard, we have established distribution channel so we have make the spares
readily available through this channel to provide customers with best in class spares.

We may offer personnel differentiation from their competitors to attract their customers. We
will be recruiting competent and responsible personnel. As a result, we will have qualified
management and will providing training facilities to the personnel in modern and well
communication system. We have a well-equipped distribution channel by which it can serve
its customers through velocity. Performance of an automobile company highly depends on
its distribution channel. The companies are trying to take the competitive advantages
through fruitful distribution channel.
Value Proposition:

Statement: Drive your heart

Key words:

Efficient
Elegant
Enduring

Salient Features:

Fuel Efficient
Affordable
Designed to Outclass
Better Service and distribution
Superior service
Spare availability.