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Introduction

Scanning the Environment


PEST Analysis
Technological
Honda Eco
Technology
Improvements
in the design of
engine parts
Increase in
Mileage due to
optimisation
Social
Growth in the
youth
population
Positive
attitude of
both genders to
wards Activa
Economic
Rate of Inflation
Cost of Raw
materials
Interest Rates
Purchase of
two-wheelers
Political
Effect of change
in government
Plan to revamp
labour laws by
the new
government
Scanning the Environment
Customers
Expansion of customer base
from primarily adult male
customers to a broader
demographic
Buyers include both sexes
and spread across age
groups from youngsters of
the age of 16 to older
generation
Ideal family scooter 70%
attributed to family sales

Competitiors
19%
53%
5%
1%
1%
8%
13%
Scooter Market Share FY13
Hero Motor Corp Ltd
Honda Motorcyles and
Scooter India
Yamaha Motor
Mahindra Two Wheeler
Piaggio Vehicles
Suzuki Motorcyle
TVS Motors
Model Price Mileage
Honda-Activa 49756 60 Kmpl
Hero motocorp- Mastreo 48200 50 Kmpl
TVS-Jupiter 49210 55 Kmpl
Suzuki-Access 53597 55 kmpl
SWOT

Methodology Adopted for Study
Scanning the
envionment
(PEST
Analysis)
SWOT
Analysis
Identification
of balance of
power
(Porter's five
forces model)
Assessment
of customer
behaviour
(Market
survey)
Porters Five Forces Model
Long run prospects
Foreign automobile
companies might set up
subsidiaries in India
Entry Barriers
High initial investment
High risk nature
Options available to the
buyers
Substitutes are available
Supply- Demand mismatch
in the industry
Engine manufactured in-
house
Fragmented tyre industry
Low availability of
automobile grade steel
Fragmented battery
industry
From other non-geared two
wheelers
From geared two wheelers
like bikes
Improving public transport
like Metro, public buses
Large market share in this
segment encourage new
entrants
Old players launch new
products across segments
Consumer Behaviour Analysis
To study and analyze the behaviour of the
consumer a survey on the two wheeler market
was floated to a targeted age group of 20-25
years
The factors that are involved in the decision
making process of the consumer while buying
the Honda Activa were meticulously observed
1. What do you consider the most important
factor while purchasing a two-wheeler?
11%
28%
50%
11%
Important factors while
purchasing a two wheeler
Price Mileage
Style After sales service
The results showed more
inclination of consumers
towards the style and the
design of the two-
wheeler.
The data of the survey
clearly shows a change in
trend. Earlier the
consumers in India gave
more importance to
mileage and value for
money

Main reason to buy a non-geared scootor?
Reasons to buy a scooty over a motorbike?
25%
39%
14%
22%
Reasons to buy a non-geared
scooter
Education
Family purpose
Other
Commuting to your job
43%
18%
39%
Reasons to buy non geared
scooter over motorcycle
Fits all in the family Economical
Easy to ride
Customers required two-wheelers for family
purposes, for commuting to the office,
schools, coaching centers, etc. The correlation
in the answers to different questions showed
Who needed a two wheeler for family purposes
chose Honda Activa as it is useful for the whole
family
Who use a two-wheeler for commuting purposes
were more insistent on better fuel economy.
4. Which brand does come to your mind when you
think of a scooty?
While most consumers
chose Honda Activa as their
preferred choice, the ones
who chose other than that
had their most important
factor while purchasing a
two-wheeler as after sale
service.
This further illustrates that
after sale service of Honda
Activa lacks in catering to
the needs of the
consumers.
87%
10%
3%
BRAND PREFERENCE
Honda Activa TVS Jupiter Others
5. Which scooty will you suggest others to buy?
Around 85% of the consumers
who buy Honda Activa suggest
others to buy the same. This
shows the brand loyalty of
Honda Activa.
15% of consumers who do not
suggest buying it gave a
reason of poor after sale
service and design.
Interesting to note was that a
few respondents who
themselves would buy some
other brand would still suggest
Activa to others
This shows the strong brand
presence and trust of Activa
61%
11%
17%
11%
Non geared vehicle
customers will suggest to
other potential customers
Honda Activa TVS Jupiter
Hero Maestro Others
Analysis of Consumer Behaviour
It is evident through the whole survey that Honda Activa is
still the most preferred two-wheeler.
Though a slight change in inclination can be witnessed
towards other substitutes, Honda Activa manages to do well
to satisfy the demands of its consumers.
It is interesting to note that among the both genders
females respondents look at other competitors of Activa
much more than male respondents.
Positioning
Good Positioning
Strategy
Clarify Brand's
essence
Identify the goals
it helps the
consumer achieve
Show how it does
so in a unique
way
Positioning Strategy of Honda Activa
targeting all the age groups and is positioned
as a brand which fits everyone in a family.
The focus is more on the youth population in
India in the age group 18-30.

Limitations of the Research
It is difficult to get a sample
which nearly reflects the likes
of the entire population for a
survey
Research was limited to the
city of Gurgaon
Research was limited to the
two wheeler Activa in
general and particular models
of Activa were not mentioned
Research could have been
wider in scope if consumer
behavior pattern and
customer satisfaction levels
were also studied

Peer to peer comparative
analysis was not done in the
survey and only absolute
research was conducted
Validity of the findings is an
issue as all the respondents
might not fill the correct
choices as per their perception
and behavior
The research environment
changes continuously and so
do the choices of the
consumer

Scope of Future Research
The segment analysis can further
be expanded by including other
substitutes operating in the two
wheeler segment such as
motorcycles especially low cost
motorcycles and geared scooters.
One of the growing segments is
that of the electric scooters. This
segment is still very small, but is
growing at a good rate and so
may prove to be good
competition in the future. Honda
itself is coming out with an
electric variant of Activa.
During the research it was found
that many new competitors
would be entering the market in
near future especially foreign
competitors with high luxury
appeal. The effect of these
products on Honda Activa can be
studied.
More research can be conducted
addressing the technological
innovations that are upcoming in
the industry by Honda as well as
the various competitors.