School of Business

Marketing Management
MKT-302

Group Project
On
Sports Utility Vehicles
(SUVs)

Prepared For: Mr. Rumman Hassan

Date of Submission: 07 July, 2008

Prepared By

Name ID
Md. Zahirul Quiyum 0620369
Abdul Ali Razib
0610044
 Letter of Transmittal

To,
Rumman Hassan
Course Instructor
MKT-302
School of Business
Independent University, Bangladesh

Subject: Submission of project report on SUVs Competitive

strategies.

Dear Sir,
We are very grateful to you for giving us such a wonderful opportunity
for composing this project report on SUVs Competitive strategies.
This assigned task has developed upon the interview we took and our
knowledge based on this topic.

We have tried our best within our limitations to make this report useful
one and undoubtedly completing this paper was worth the effort.
Finally we would be highly oblige if you overlook the minor errors in
the report and earnestly hope that you enjoy reading this report as
much as we did while composting it.

Yours truly,

Md.Zahirul Quiyum
ID: 0620369

Abdul Ali Razib

ID: 0610044

Acknowledgement
This project report might not be possible without taking some helps
from the books and the internet. This report has been prepared by
group of 2 people as a part of the MKT-302 course requirement. It
is prepared after having extensive surveying and analysis.

We would specially like to thank:

Ahsan Habib , Client Relation Manager, Great Wall, Tejgaon, Dhaka.
Md.Shadijul Mosguk, Customer Care Manager, Mercedes-Benz,
Tejgaon, Dhaka.
Md. Asad-uz-zaman, MBA student, East West University.
Arefin Hossain Mridul, BBA Student, IUB.
For their valuable time and cooperation. Moreover we would like to
mention the name of Mr. Rumman Hassan, our course instructor for
his valuable time and suggestions as we have bothered him in time to
time. That’s why our true gratitude goes to Mr. Rumman Hassan for his
polite and kind cooperation and we hope him to have a very successful
and smooth career in future.

Table of Content
 Chapter Contents
1 Executive Summary
2 Introduction
3 Current Market Situation
4 Prices of Different
Companies SUVs
5 Competitive Strategies for
market leader
6 Market Challengers
Strategies
7 Market Follower Strategies
8 Market Nicher Strategies
9 Conclusion
10 Reference
11 Bibliography

Executive Summary

A sport utility vehicle, or SUV is a generic specification for a passenger

vehicle which combines the towing capacity of a pickup truck with the
passenger-carrying space of a minivan or station wagon together with
on or off road ability. Most SUVs are designed with a roughly square
cross-section, an engine compartment, a combined passenger and
cargo compartment, and no dedicated trunk (i.e. a station wagon
body). Most mid-size and full-size SUVs have three rows of seats with a
cargo area directly behind the last row of seats. Compact SUVs and
mini SUVs may have five or fewer seats.

It is known in some countries as an "off-road vehicle" or "four-wheel

drive", often abbreviated to "4WD" or "4x4", pronounced "four-by-
four". However, not all SUVs have four-wheel drive capabilities.
Conversely, not all 4WD passenger vehicles are SUVs. Off-road vehicles
are a very different class of vehicles, being vehicles primarily built for
off-road use. Although some SUVs have off-road capabilities, this is
often a secondary role and they often do not have the ability to switch
between 2WD, 4WD high gearing and 4WD low gearing.

More recently, manufacturers have responded to buyers' complaints

that SUVs "drive like trucks" and demands for "car like ride" with a new
type of SUV. A new category, the crossover SUV uses car design and
components for lighter weight and better fuel efficiency, but is no
longer designed or recommended by the manufacturer for off-road
usage or towing.

Introduction

The world of business is moving more rapidly than ever. In order to

sustain and keep pace with these fast-changing scenarios, marketing is
one of the main weapons for the organizations. Marketing define the
process by which companies create value for customers and build
strong customer relationship in order to capture value from customers
in return. Any business organization that wants to earn a profit
definitely needs to create a customer value and satisfaction through a
lot of activities. These activities are a part of what marketing does for
an organization. In an old fashioned thinking many might think a Car
Manufacturer or Company doesn’t need any kind of marketing but this
certainly has changed in the 21st century. Especially the Car
Companies have changed the way we used to think as they are always
coming up with new ideas to improve customer satisfaction. Now days,
the competition is so intense that if a Car Company needs to survive
this competition they must have a very good marketing strategy. For
example, how many Car Companies had provided or there were any
company that provided online choice board to customers to design
their own car as they want. But now a days many car companies are
providing this type of services. They are providing post-purchase
services, guarantees and warrantees on parts of the car, customizing
car as the customer wants - sometimes the customer does not say to
do but they do to make customer delighted. The classic example could
be, a consumer bought a Mercedes-Benz car and when he was driving
to home he turned on the radio. He found that channel number 1 was
tuning to his favorite local news channel, next one was his favorite
song channel, next one was his daughter’s favorite and so on. The
service man tuned the car as consumers old car instead of asking to do
that. That made the consumer delighted and he will talk about
Mercedes-Benz favorably which would be a good advertisement for
Mercedes-Benz.

IN Bangladesh, there are many Car Companies and many of them

make and sell SUV. A sport utility vehicle, or SUV is a generic
specification for a passenger vehicle which combines the towing
capacity of a pickup truck with the passenger-carrying space of a
minivan or station wagon together with on or off road ability. And most
of them have improved their SUVs and made new versions of those or
launched as new modeled SUVs. So to attract and sell to new
customers and also to retain customers they need differentiated
marketing strategies.

Prices of Different Companies

SUVs

No Company SUV Price Range (Taka)

1 Nissan Murano, Pathfinder,
Petrol, X trial
2 Mitsubishi Outlander, Nativa, 4,800,000 to
 Pazero, Pazero Sports 6,500,000
3 Toyota Rav4, Fortuner, Prado, 3,500,000 to
Land Cruiser GH 9,000,000
4 Mercedes-Benz M-Class, Renton 23,000,000 to
30,000,000
5 BMW X5, X3 15,000,000 to
25,000,000
6 Great Wall Hover 900,000 to
2,600,000
7 Honda CR-V 2,5000,000 to
3,600,000
8 KIA Sportage 3,300,000+
9 Lexus ( Side LX470, Harrier 6,000,000+
Brand of
Toyota)
10 Tata Safari, Sumo 2,800,000+
11 Maruti Suzuki Grand Vitara 2,700,000+
12 Mahindra Bolero 3,000,000+
13 Land Rover Range Rover
14 Hyundai Terratan 3,500,000+

Current Market Situation

At present, RANGS Limited (RL) is the market leader in the sales of
Sport Utility Vehicles or SUV, made by Mitsubishi Motor Corporation
(MMC). In the financial year 06-07, it has sold about 130 units of SUV,
which worth approximately TK. 52 corer. In the field of SUV’s, RANGS
Limited face challenges mainly from Navana Motors- which brings
Toyota made SUV’s & Pacific Motors- which brings Nissan made SUV’s.
Recently, though the government of Bangladesh is using Nissan Petrol,
Nissan Xtrial, Nissan Pathfinder and various Nissan’s automobiles as a
formal transport, recently Nissan has established itself as a closest
competitor of Mitsubishi. And RANGS had very successfully captured
the significant market share of the brand new vehicles in Bangladesh
Defence sector; it has enjoyed solid profitability over the past few
years, which enabled it to be financially strong company.

There are many other companies; Mercedes-Benz, BMW, Mahindra and

so on; who make and sell SUVs. All of these companies are now
concentrated on capturing market share of recondition market
segments.

Competitive Strategies for

Market Leader

As a market leader in Bangladesh, Mitsubishi plays a important role in

the industry and in their target markets. It has the largest market
share of SUV market segment, and usually leads the other firms in
price changes, new-product introductions, distribution coverage, and
promotional intensity. It has created a distinct position in consumes’
minds.

The trend analysis of the last two financial year’s sale show that, the
demand for SUV is again increasing after a set-back of the previous
couple of years. So, there are enough opportunities to grab a bigger
share of the SUV market. Strengthening the sales of pre-owned SUV
can be a good strategy to target middle-class customers. This will also
result in more visibility on the road. There is possibility of motivating
and facilitating private customers to buy used Mitsubishi SUV’s by
arranging a used car sale initially every month then even as frequent
as every week. If a Mitsubishi Club can be introduced, R.L. will be able
to build a system to communicate with its customers, listen to them,
respond to their requirement, learn the down side of its operation,
make improvement, create brand loyalty etc, which should help to
capture and retain substantial amount of market share of SUV’s.

Mitsubishi SUV Sales Trend

Year 99-00 00-01 01-02 02-03 03-04 04-05 05-06 06-07

Units 75 85 24 172 172 202 128 130
Sold
 250

At present the competition among the automobile dealers is very

extensive. For the last 5 years the competition is growing steeply by
introducing category wise vehicles with a very competitive price and
services along with aggressive sales & marketing activities. In SUV,
Pajero significantly leads its number one position with a very good
reputation to its users. But Rangs Limited is in setback with mid size
SUV.

A product innovation may come along and hurt the leader. The leader

200
might spend conservatively whereas a challenger spends liberally
(Nissan has already attacked by capturing the government segment).
The leader might misjudge its competition and find itself left behind
(Mitsubishi has lost market share of government segment because it
didn’t succeed to manage the political condition in the favor of them).
The leader must need to spend much on product research and product
development to hold its position.

Remaining number one, Mitsubishi calls for action on three fronts:

1. Expanding the total market: After capturing large number of
market share, Mitsubishi is now trying to expand its total market
in various ways:
Mitsubishi is searching for new users in existing markets by
promoting, offering financial benefits, offering new features,
colors, tests drive and so on.
It is also trying to find new market segments for its current
products and is offering its products to discover new market
segments.
RL gets benefited from the image of RANGS. Moreover,
Mitsubishi itself is a global giant. The sign of RANGS and
Mitsubishi Diamond sign are very popular. RANGS is also the
distributor of Daimler-Chrysler with its brand Mercedes-Benz.
It is also launched its new branches for convenience of
consumers.
RL carries wide product line of brand new cars in Bangladesh.
Unlike, the importers of Hyundai, KIA, Daihatsu and some other
international brands, RL competes in every category. Mostly, RL
competes in SUV, sedan and truck category in defence tender.
It arranges and participates in car fares to advertise and
reposition its products.
For years, Pajero is considered the status of prestige to not only
the rich, but also the political figures and high Govt. officials. It
can be said that despite the recent competition from Toyota
Prado for the preferred luxury SUV, Pajero remains the desired
one.
It is trying to discover new ways to increase its products usages.
 It also decorated and also aware to decorate its branch
showrooms attractively and it also manages its all product
models in the showroom showcases. It has attractively decorated
the main branch in Tejgaon.
Mitsubishi is considered a good quality car. It lacks visibility
which Toyota enjoys, it suffers from more price than Nissan, but
technically it is as good as any car.

2. Defending market share: While trying to expand its market

share, Mitsubishi is also trying to defend its market share. It must
defend against Nissan, Toyota as these are the main challengers.
The most constructive way to defend its market share, Mitsubishi
tries to serve superior value to the customers and it also does
proactive marketing as Mercedes-Benz. It produces efficient,
reliable and durable parts of the SUV and assembles accurately
to gain more brand equity and retain and capture customers.
It mainly concentrates on providing high fuel efficiency, sought
features and possible maximum acceleration in its SUVs.
Because it has own distribution network, it can distribute its
products more efficiently and effectively.
It produces a full line of construction equipment to enable
customers to do one stop buying. Like alliance with bank,
insurance company to provide customers car loans, insurances
within its branch.
It also defends its product by occupying and maintaining the
most desirable market space in the minds of the consumers.
It erects outposts, such as it consists of a multitude of
independent companies such as- in Banking & Security industry,
The Bank of Tokyo-Mitsubishi UFJ, Ltd; in Chemical industry,
Asahi Glass Co., Ltd and so on.
 By improving or innovating products in each or within some
years, it counterattacks against other competitors who launched
a new or improved relative products.
Mitsubishi also contracts its old obsolete products and applied
resources to new product development fields which may be a
good defense to survive and also to hold the position in the
market.

3. Expanding market Share: Mitsubishi improves their

profitability by increasing their market share. Each year it
reintroduces its product by developing its SUVs. It makes them
more fuel efficient, increased engine performance, added more
features and promotes customers to buy and use these products.
It is also trying to gain more production efficiency to reduce its
cost and to offer products at a much lower price.

Market Challengers Strategies

SHIFT_. A single word that captures the passion and commitment has
driven Nissan. “Everything we touch, we shift. And everything we shift,
we make better.”
Toyota, Nissan, Mercedes-Benz, Honda, KIA, BMW, Great Wall, Suzuki,
Mahindra, Subaru, Cherry, Chevrolet, Land-Rover, Naza, Hyundai, Ford,
and Porsche and so on; these all firms are market challengers. They
can attack the leader and other competitors in an aggressive bid for
further market share.
Many market challengers have gained the ground or even overtake the
leader. Nissan might want to capture more market share of other
competitors and the position of Mitsubishi. Not only Nissan but also all
challengers want to capture more and large portion of market share
and to become as a market leader. For doing that, every challenger
does some attack strategies.

1. Defining the strategic objective and opponent(s): Every

company in the
Industry has established strategic objectives and identified its
opponents. Mercedes-Benz has already started to develop a product
which will be launched in 2009 and will capture the recondition market
share. Although BMW has high performable engine and high quality
SUVs, because the price of its products are too high than others; like
Toyota, Mitsubishi, Nissan, that it does not succeed to capture market
share as much as Nissan, Toyota and some others. It has launched
SUVs; BMW X5, BMW X3; in Bangladesh which price are more than
20,000,000 taka.
Toyota and Nissan are so close to Mitsubishi. Toyota has captured a
large market share in the industry than others in Bangladesh, but in
the sells of SUV Mitsubishi is the Market leader. Toyota has launched
direct attack against Mitsubishi through offering new SUVs- Toyota
Rav4, Toyota Fortuner, Toyota Prado and Toyota Land Cruiser GH. They
offered these SUVs at more low prices than Mitsubishi. The range of
the price is 2,500,000-9,000,000 taka.
There are also other companies who are also launching continuously
new products and other attacks that create a great difficulty for the
market leader and also for other competitors in the industry.
Honda, Mercedes-Benz, BMW, Toyota, Mazda and others; all are
attacking also one another’s to attract and gain others customers.
They also launching attack against weak companies, such as- Great
Wall, Cherry, to gobble up and capture their customers.

2. Choosing A General Attack Strategies: The challengers can

also launch
attacks against leader or other competitors by using attack strategies.
Toyota launches attacks against competitors through using flank
strategies. For example, it offers fuel efficient, low priced, limited
featured, better assembled and spare parts availability SUVs where
Mercedes-Benz has high quality, high performable and larger amount
of featured, luxurious and highly priced SUVs. So middle class people
obviously consider Toyota to buy because may have not ability or if
they have, they don’t want to spend huge amount of money on buying
Mercedes M-Class. And may be wanted a low maintaining cost and fuel
efficient SUV.
In the past, Volvo had launched an encirclement attack against all
large companies by positioning their product in the minds of
consumers as safest and durable. They have captured a wide slice of
the competitors’ territory through this blitz.
The major strategic attack by which Toyota has captured the most of
the market share of overall sells in Bangladesh is Bypass attack. Those
market segments whose were avoided by large companies; BMW,
Mercedes-Benz; was concentrated by Toyota and by gaining reliability
and popularity from those segments it has become the number one.
Every company executes guerrilla warfare against each others. All of
the companies are intensively active to find a gap so that they can use
it as an opportunity.
 3. Choosing a specific attack Strategies: Every company also
does some more specific strategies.
Almost all companies promote price discount for their products. This
type of promotion mainly offers at any special day or occasions.
Toyota, Mercedes-Benz, Great Wall and so on also offers low price
products to increase market share and also attract and capture
competitors customers.
Mainly Mercedes-Benz, BMW, Volvo, Land- Rover offers prestige goods.
These products help companies to position their products in the
consumer’s minds.
Almost every companies; BMW, Nissan, Toyota and so on; offer a larger
product variety to influence and to give option to customers to choice
their preferable products.
Almost every company in the industry executes marketing research to
innovate new products that can satisfy consumer’s needs more
efficiently.
High quality product manufacture companies always search for new
ways to reduce their manufacturing costs to offer their products at
lower price to the consumers.
Almost all companies do intensive advertising promotion for their
products.

Market Followers Strategies

 In this entire industry, there is no market follower. Because all
companies in Bangladesh, instead of manufacturing they import SUVs
from their parent countries, so they do not imitate anything from other
competitors. They shift their SUV prices by observing their competitors
but do not match it because the parent country’s dealers are
determined the price.

Market-Nicher Strategies
In this industry, there does not have any niche. Because to enter and
survive in this industry, a firm requires a huge amount of financial
funds, any small firm does not want to enter this market segments and
so the existing firms do not offer any specific SUVs for any specific
community or group.

Conclusion
The automobile industry in Bangladesh is resembled as differentiated
oligopoly competition. This industry has a limited number of
companies, high entry and exit barriers because of high capital
requirements, intense competition and so on. To capture more market
share and attract new customers, it requires huge promotional
activities, so cost of running activities in this industry is high. The
market segments of SUVs are highly unattractive too because of
numerous, strong and aggressive competitors. Reasonable duty
structure, CNG facility, change in life style of middle class & upper
middle class family will make these segments more attractive as well
as competitive. The big company Mercedes-Benz has provided high
quality SUVs and services. Its SUVs are capable to perform better,
comfortable driving, luxurious, high engine performance and swiftness.
But they are dominated by Mitsubishi Motor Corporation, Toyota and
Nissan because of comparatively high price and less fuel efficiency.

Reference
http://en.wikipedia.org/wiki/Suv
http://www.automobilemag.com/used_car_pictures/05/suvs/mitsubishi/i
ndex.html
http://www.automobilemag.com/used_car_pictures/05/suvs/bmw/index.
html
http://www.automobilemag.com/used_car_pictures/05/suvs/honda/inde
x.html
http://www.automobilemag.com/used_car_pictures/05/suvs/nissan/inde
x.html
http://www.automobilemag.com/used_car_pictures/05/suvs/toyota/inde
x.html
http://www.automobilemag.com/used_car_pictures/05/suvs/mercedes_
benz/index.html
http://www.automobilemag.com/used_car_pictures/05/suvs/mazda/inde
x.html
http://en.wikipedia.org/wiki/Nissan#Alliance_with_Renault
http://en.wikipedia.org/wiki/Nissan
http://www.automobilemag.com/used_car_pictures/05/suvs/lexus/index
.html
http://www.toyota.com/about/our_business/at_a_glance/index.html
http://www.nissanusa.com/about/
http://www.toyota.com/about/our_business/at_a_glance/index.html
http://www.mitsubishi.com/e/group/about.html
http://www.nissanusa.com/about/heritage/the-early-days.html
http://www.mitsubishi.com/php/users/category_result_industry.php?
gyousyu_id=0006&lang=1
http://www.mitsubishi.com/php/users/category_search.php?lang=1

Bibliography

1. Marketing Management
Written by: Philip Kotler & Kevin Lane Keller
12th edition
2. Principle of Marketing
Written by: Philip Kotler & Gary Armstrong
11th edition