Nano Emotion

First car? Better give it a test....A Quality Test

Is there an impact of a test drive on the purchase decision, during a car purchase? If so, how much?

When my friend wanted to buy a car, a hatchback, he first test drove the Figo. Then on my insistence he tried the Indica Vista. He fell in love with the car in just 10 mins of drive and finally booked one. (Sorry Ford, nothing personal)

In this case, it was just the feel of the car for that crucial 10 minutes, that changed his purchase decision.

But honestly, is that 10 minutes really enough for somebody, who is buying their first car? May be an Alto or a WagonR which normally people would have driven through their friends or relatives, may say, the test drive is nothing critical. But in general, it is that factor which decides the purchase or may be a step further by forming an opinion on the brand too.

Especially with such a huge competition in the small car segment, one can make a difference only by making the customer feel the product. The manufacturers like GM clearly understand this and they go above the line and say 'Test drive like you own it'. But, in reality, how much of this actually happen?

I would say it is at the dealers end, where most of the time, test drive is seen as a liability. I would like to stress on MOST and NOT ALL. May be a dealer is selling more and beating competition, which can be attributed to many other factors that are considered during a purchase. Like in the previous example, for a customer who has come for an Alto or a WagonR, a test drive will really not matter much. Otherwise, very few dealers actually insist on a 'Quality test drive'.

A quality test drive basically means letting the customer feel the car like he owns it. There are a few steps which i think, dealers should help a first car buyer during a test drive.

1. Let the test drive car be in the best of its condition. Both exteriors and interiors along with the engine and service really matters as first impression is always crucial.

2. A first time car buyer will obviously panic during the test drive as he/she may not be a skilled driver. So be kind enough to encourage him/her and not to worry about anything going wrong on the road.

3. Educate the customer on how to adjust the seat, steering (if there is an option), rear view mirrors, dashboard controls, stalk controls etc, as they vary from one car to another. If the customer panics in the middle of the road, then the purchase will definitely not happen. At times even the clutch settings and the break settings may not suit a particular customer and the test drive may go haywire.

4. Give a product feature explanation in the test drive car also, preferably a live demo. This may enable the driver to actually use that option during the test drive.

5. And above all, the distance of the test drive. Please do not insist on any specific route for your convenience. Let the customer choose where he/she wants to test drive the car and the time he/she wants to drive it. The more they drive it, they more they feel it and the more chances of buying it.

So dear dealers, along with manufacturers, its just not enough if a test drive is given. A quality test drive is more important.

Dear customers, Happy testing and Happy driving.

Can Etios live upto its Q Class?

Surprise on the morning of December 1, 2010 when Toyota announced the prices of their new game changer - Etios. At 4.8 Lakhs to 6.7 Lakhs, this could be the car that the company would bet on for volumes. There is just one sedan that can take Etios head on - Tata Indigo Manza. Rest all, fall in a totally different league. But this is the first time Toyota has made such an attempt unlike Tata where they already had Indigo in this price range.

What did Toyota do to get in this league? They call it localisation. May be true. But I want to take a closer look. Though this may be a bit premature to do this without the car being physically present, there are enough reviews by experts on the car. Let me draw my opinions from them.

Looking at the exterior, may be Toyota fans will get disappointed. No signs of Toyota. Though I wouldn't say as bland as Logan, still pretty boxy and conservative. Getting to the interiors, the dials on the centre and the instruments console to-gather look very funny and tiny. I doesn't give a Toyota feel. May be they'll suit Nano better and definitely not Etios. The rear seats are claimed to be the most spacious even beating a segment above.

Having said all these, Toyota for the first time has stepped out of its shoes to custom make a product for India with extensive market research and and customer insights. The result of the research is Etios. This should sweep the hearts and win volumes.

But HEY!!! Wait!!!

There might be a problem.

Did they loose something?

May be!!!

I think its their Brand DNA - Quality, What Toyota stood for all these years.

As far as i remember, unlike Volkwagen, Toyota never did any huge branding campaign. They just carried their DNA in their product and it was visible. People accepted it. After all, thats what they stood for.

And for the first time, they have started using the term 'Quality' in their communications. Why say it when you are already good at it and if you are continuing to do it ? 

The initial previews have suggested that though this is for the masses, the car lacks the finesse of a Toyota. Can they do what Maruti and Tata have done in terms of volumes ? 

Before answering this, it is very clear the way Maruti and Tata reached this position is by improving on their previous versions and thereby improving on the customer satisfaction and confidence. This has built their brands so strong. 

Conversely, Toyota is trying to step down from a higher level. If this is for numbers, may be initially they may sweep the market. But in the long term, they can retain only one image. Either premium or a mass player.

At this situation, both will be a problem for Toyota. If they retain their existing brand perception, Etios will become a bad recipe. Else, Etios becomes the darling of the masses leaving the Corolla and the Camry in trouble.

Now that the game has begun, a small note for the marketers at Toyota, 'Guys, Things are going to get difficult'.

Heights of advertising - Carvetising

One obvious field with only your imagination as boundaries is advertising. One can create a concept, without worrying about the logic and practicality and still make huge success as advertising is all about turning heads. 

Now team associates  has come with such a crazy concept. 

Carvertising. 

Forget the jargon. Let me put it simple. Use brand new cars as bill boards. 

Still confused? See the picture below. 

                                      
            (From the Pic: A Dell employee would never book one)

As of now for my knowledge, they are in tie up with GM for their cars. Though I am not sure if the tie-up is for the entire range, small cars is for sure. It works like this.

Now, companies instead of hosting banner ads in huge bill boards at a high expense, can use this small new car which will go across the city as their mobile bill boards. In return the customers are paid a fixed sum of money (of course, there are terms and conditions) for a certain period. The only way the customers can get lured by this offer is because may be this sum will cover upto 75% of the EMI.

Otherwise, for a customers like Mercenary Frank Martin or even myself, who belives 'the way a man treats his car, is the way he treats himself ' this is going to be nonsense. 

Also in a typical Indian scenario, where a car is something that is still seen as a social status and a display of well being, I doubt how many would actually be happy to use their cars as mobile billboard for those few thousands.

Crazy Marketers.

Are you Ready....to WAIT !!!

Last week I was back on my test drive spree after quite some time....this time inspired by some more new comers and many more face lifts.

While I was observing some fellow customers, along with the typical questions like mileage, boot space and power.... the delivery time has started to take an important place. It is also becoming to be a key influencer in the purchase decision. 

Right from Ambys and 800s till the Swifts of 2005, the options available for our customer were limited. This meant that customers were ready to wait for what they want. But todays crowd int he market place has led to less differentiation or pretty much similar USPs ( pardon me brand heads). This has led to features like colour and standard equipment take a strong convincing factor along with the delivery period.

Partly, the success of Hyundai against Maruti and Ford against Volkswagen can be attributed to the delivery period. Along with other issues, the de-growing sales of Nano is also due to the non availability of the product in the initial days. 

So manufacturers, better pull your pants up and ramp up your production. 

Along with Time and Tide, Customers wait for none.

CBR 250 from Honda

Is this The Blue Oval's Blue Ocean Strategy ?

2010, has been a remarkable year in the history of Indian Automobile Industry. This is the year that witnessed many global giants setting up plants in India and launch India specific products and making India the export hub for these products. A couple of years back, if a customer wants to buy a hatchback, there were hardly a handful of brands dominated by Maruti, TATA and Hyundai. Today, we have Chevrolet, Volkswagen, Ford, Nissan, Toyota and many more to come all lined up with their offers. 

But how many of these manufacturers actually manage to capture a share of their pie. Clearly Ford with Figo is the only manufacturer to have done that in style. 

50,000 units between March 10 to October 10, 2nd fastest model to achieve 50,000 units in India, overtook Tata Indica to the 5th spot in vehicle sales during the month of October 10, 3 digit growth rates for Ford India.... These data should be sufficient to judge the success of Figo amongst the models that came in 2010. 

The major problem Ford earlier had was, the brand always had a perception of high ownership cost. Other than Ikon, to a considerable extent and Fiesta, to a small extent, Ford never tasted success in India. How did Figo manage to achieve this whilst competition? 

While many others did brand building exercises before their launch, Ford kept quiet and let their product speak. The product exactly was in line with the customer expectations from a hatch, thanks to the decade old presence in India. The car was fully loaded at a price which was at par with the base variants of other models.  In a market where Value for Money is top priority, this is the key factor that was addressed. Along with the already existing dealer network, Ford also added new dealers to strengthen the sales and service network. 

Rather than fighting with existing players and fellow new comers, Ford devised its own plan and created an own market for itself. This is evident as the market share or the sales figures of Maruti, Tata or Hyundai did not get affected. Eliminating its earlier problems with the brand, Figo gained confidence of the customers.

Going in-line with the Blue Ocean Strategy, though not complete, Ford had also made the competition irrelevant and had created value innovation with the Figo. 

The success of Figo has once again proved that, in India a failure once never means the brand can't bounce back to winning ways. Also Indians have a welcoming heart that actually means value for them.

Old Habits, Die Hard...

2 years back, when i asked my father 'should we buy a car?', he said yes

When I was listing down the models that fitted my preference, his choice was an Ambassador. According to him, this is one car, which is rugged for Indian roads, offers huge space for 5 or even 6, good mileage and more importantly rooftop loading in addition to the huge boot.

Though I laughed at his choice at that moment, none of these were nonsense till mid 90s. Till the Sumos and Scorpios came, Amby was the vehicle from politicians to celebrities & heros to villains.

Though there were technical updates, the brand failed to update itself according to the changing needs and demands of a car buyer. But how did the customer get these needs all of a sudden? The industry opened up and better cars from Japan, America and Europe gave Amby a tough battle. So did it loose the battle?

I would say NO.

But how?

The company had an approx market share of 0.77% in FY 2009 selling around 11,000 units. With Indian Auto sector at its highest growth rate, is this a great number? It is not.

For a car, whose production started a huge 52 years back, no major changes done other than engine updates and few cosmetic changes, still selling 11,000 units is not a bad deal. But the major buyers are some people like my father, who still relish the brand and some institutions through special orders and prices.

All of a sudden, there is a buzz in market and social networks, that HM is planning to revive the brand. Though no great design or technical updates are expected, I would still like to see the brand along with the likes of Germans, Americans and Japanese.

Introducing 5 Series

Need More Mileage? Yes, ofcourse...

Click here to improve your vehicles mileage.

Honda CR-V Commercial in Australia

VW Vento - India Launch ( Amateur Video)

A New Hope...?

Production of Polo in Spain

A serious concern....

Golden Quadrilateral and North-South, East-West Corridor is almost complete. Better national highways and state highways. 

Quality and performance of cars improving day by day. Once 60 kmph was great. Now 100+ kmph has become the order of the day. 

All this have resulted in...... more & more accidents everyday.

The main cause is negligent driving and ignorance about the road rules.

As per a report from WHO, India tops south-east Asia in number of road accidents every year. Another report claims the number is almost 250 everyday. This means, everyday a fully loaded passenger flight crashes in India. Just because it is not reported as a total number at a single place, we don't really mind this. 

The first one i would blame for this is the government. Right from issuing the driving license to penalizing the traffic rule breakers, the role of the government is important. This is where we have a major blow. Whenever a citizen gets caught by a traffic cop, the first thing that strikes him/her is to use an influence or bribe the cop. Though there are few cops who stick to their job, the number is just not sufficient. Only a heavy penalty like cancelling the license for a year or behind the bars for some period will force the vehicle users to stick to the rules.

But is this really something that should be forced? Are we not concerned about our own safety and the safety of a fellow human? 

Whenever somebody does a negligent driving, the co-user of the road is also at an equal risk. This applies to pedestrians too. A lot many times, improper crossing of the road, leads to accidents resulting in death of the pedestrian as well as life over for the driver.

Dear road users, whatever vehicle you drive two wheeler, four wheeler, heavy vehicles or pedestrians, please bear in your mind that somebody is waiting for you and somebody is waiting for fellow road users too to be back home safely.

Long drives...? Be prepared...

preparation for a long journey

A Handy Guide.....

Do Yourself Repairs

Another Hatch...Nissan Micra

A Humble History

1. Long back, an automobile magazine released an article on the safety features and build quality of all the cars on Indian roads. In the list, it was the Omni that has scored the most (close to some 240 points). I was actually surprised. Then when i read the last line, it stated, the more the points, the worse the vehicle.

2. Indian Automobile sales for the month of April 2010. Omni is overall No 8, selling 8090 units and still going strong. Omni is also upgraded to meet BS IV emission norms.

Confusing?

Maruti began its first success story in 1983 with the 800. The second success story started silently in 1984 in the name of Omni. It was a model from Suzuki in the 1960s named Suzuki Carry. In India, Omni carries a unique engine in the front middle and a rear wheel drive. It is a 3 cylinder engine producing 798cc and 35 bhp @ 5000 rpm. It is available in 5 seater and 7 seater models along with Petrol and LPG versions. 

What is the success story of this highly criticized vehicle by auto experts?

I believe the answer is the Value it has created to its consumers. Or in other words the utility rate of this car is way high. Recently no great advertising or other marketing techniques are used to promote the brand. The peace of mind that comes with the Maruti tag and the feedback from the existing consumers through word of mouth, still has kept this brand young and active, even after 26 years. All that Maruti had done is to meet the emission norms and give the brand timely updates. Even now, there is no exact replacement or alternate for an Omni.

F1 Track in Delhi - Official Date

OooHhh...One More CBU...

The recent news from Rediff Business states that, Mitsubishi is planning to launch the Lancer Evolution, the much awaited model in 2010. It is supposed to be 2.0 litre, turbocharged engine producing 300 bhp. But, this is again going to be a CBU. The car is expected to cost around 40 Lakhs. The company has indicated a target of 75 cars in its first year.

So, rather than competing against the likes of Accord, Teana and Superb, the EVO will struggle between Audi, Merc and BMW. The sole player for now in the price range of 40 lakhs is Volvo with S80.

The Lancer Evo might join the fleet of CBUs after the recent and potential Fiat 500 and Volkswagen Beetle. Every second girl who sees the Beetle is actually impressed till she knows the price. Though these cars are much preferred and suitable for our urban markets, may be the demand is meagre to actually set up a plant here.

But this situation could actually be a paradox.

Unless the demand is high, there will be no local production. Unless there is no local production, CBUs will attract 110% tax thus increasing the price and reducing the demand. So, how should companies strike a balance?

May be a proper market research along with a close to perfect demand forecast should help.

Are we ready for an all new experience ?

After the boom in the Indian small car segment, Indian two-wheeler industry is going to experience an all new change. But this time its on the other side. The premium segment. When Pulsar was introduced in 2001, it created a huge demand in the premium segment. This segment then attracted more players.

After almost a decade, this segment is under going a quiet revolution. Its the introduction of high performance powerful bikes. Kawasaki introduced the Ninja 250, Bajaj with KTM is introducing a new 250cc bike, Pulsar and Apache are coming up in 250cc outfit, Honda's 250cc is on the cards and Hero Honda is in the process of designing one.

But are the Indian consumers ready for this fun? Does the infrastructure support this? 

Though the companies are not banking on this segment for volumes, is the segment big enough to self-sustain? Still Pulsar 220 and Hero Honda Karizma are struggling for their targeted volumes. 

With big companies now entering this market, the positioning and pricing of the product will play a key role in their success.

Luxury for Masses

More entrants in the Nano segment

The unofficial news for the launch of Maruti Suzuki's new Cervo, in the Rs 1.5 lakhs to 2 lakhs price segment is out. The car is equiped with a 660cc petrol engine producing close to 60 bhp. The car is expected to be a better option than Tata Nano, given Maruti's product reliability. Though the car doesn't support huge boot space and rear cabin space, the utility of the car is at this value is going to be really high. 

Hyundai is also expected to launch its new offer in the Nano segment soon. Code named H800, the car is expected to be powered by a 800cc petrol mill and cost around Rs 2 lakhs. 

After the small car segment boom, the market is now opening up for the nano segment boom. The customer will now have a range of options in this segment. Though Tata may have a first mover advantage, it may also be a disadvantage as other might learn from Tata's mistakes. Without the infrastructure to support these many cars on road and the market yet to get matured, only time can write the success stories.

Hottest News about Nano

This would probably be the most horrifying picture Mr Ratan Tata had ever seen. His dream is on fire. 

The car was delivered to Satish Sawant, an insurance agent and was also offered a driver to drop him as he cannot drive. The fire happened on the way home at the Eastern Express Highway. After the fire was put out by a fire tender, it was found that the fire broke from the rear engine. This is the second case after the first incident happend in Mumbai, where the car got self ignited. ( The owner had then claimed a Mercedes as replacement. Read Story)

These incidents have caused a serious concern on the product and its reliability. In a time where product recalls are the talk of manufacturers, the safety of Nano is under lights now. After long debates of the occupants safety and evironmental issues, Nano also won the Euro crash tests. Though it is still not clear about the exact reasons for the incidents, Tata had not made any announcements regarding these accidents. This had put the reliability of the company understake now. This, now is a chance for the other small car players to take advantage of the situation in the market. Tata should now act on this with care as word of mouth publicity is going to spread faster than the fire.

After all a promise is a promise only when delivered without compromise.

Know your New Bike Better

First few hundred kilometers are very crucial for any new bike or a car. This sets the performance level of the engine for the rest of the life of the vehicle.

To know more about maintaining the new bike Click Here.

Finally the season begins...

The wait is over. The worlds biggest racing event is back @ Bahrain this weekend. With lot of rules and regulations changed in 2010, Formula 1 has become more than just a sport. Also the additional thrill for the year is the presence of 4 world champions in the grid. All-time champion Micheal Schumacher's return to the sport with Mercedes and Ross Brawn, has thrown the game even wider. Ferrari, after a dismal performance in 2009, had made a strong statement in the practice sessions. McLaren is all set with its two champion drivers. This season also features rise of promising stars like Vettel, Rosberg & Webber and teams like Force India and Red Bull. There is a possibility that one of the 3 new teams can also make a mark.

But the game's profitability for the teams and sponsors has been a question for quiet some time. With regulated expenses and solved differences between FIA and the teams this year should be delivering the expected returns on the investments made. With the impact of the global downturn, big teams like Toyota and BMW had decided to quit the game. Existing teams had to regulate their expenditures to worth each penny. 

In 2011 FIA had also decided to expand the calendar to more locations like India and Russia after this years' 19 tracks. Expanding this way also has an inbuilt risk. There is no sport which has a fan following across geographies. Every game has its own set of viewers. This is largely due to the cultural preferences and practices. For  instance to increase the viewer-ship in India, there definitely has to be an Indian driving for an Indian team. 

At the end of the day, let me put all these issues aside, and enjoy this season, which is expected to be the most thrilling season of the game. My bet is on the 7 time champion. Whats yours??

Ford Figo - TVCs

Embrace Life - A Safety Initiative

Ford Figo - Corporate Film

Mercedes F800 Style - Vision of the Future

The next Big Entry

Team HRT announces Karun Chandhok as its second driver after Bruno Senna. This makes the official association for India with Formula 1 for the fourth time. First it was Narain Karthikeyan driving a Jordan in 2005 and then a test driver for Williams for 2 years. Then it was the entry of the Business Icon Vijay Mallya taking charge of Team Force India. 2011 was announced as a official inauguration of the India GP and the construction is on. And now for the second time an Indian behind the wheel.

Considered as a motor sports of the highest order with superlative technical innovations, F1 is a sport that all racers would dream of. But unfortunately in India, I think its still not the time for F1. When the Indian GP was planned, it was commented as " A GP in India would be like a Cricket match in Italy". The awareness and the passion towards this sport is very less. This will result in companies to bet on neither the Indian GP nor the Indian racers. A similar situation forced Narain Karthikeyan to go behind the screen. Though heavily backed by TATA, Narain failed to prove his point. 

Mallya proved this wrong by making his mark in 2009. Force India took pole position and points in the second of the season creating a strong brand for itself back home. After the recent preparations and test runs,  the team is confident of challenging the front runners after being followers for quite sometime. 

Now, Karun should learn from the earlier happenings and ensure that brand F1 as well as brand Karun Chandhok live upto the expectations of the few F1 fans in India.

Big B's Big Plans...

It seems like BMW is getting really aggressive in India. The recent actions are very evident. BMW announced the X1 the cheapest SUV from BMW for India during the auto expo at Delhi. And now the announcement of 320d CE (Corporate Edition) for individuals at around Rs 24 lakhs has come. Earlier this downgraded version was available only for corporates and institutions who buy a minimum of 3 units to-gather. The company is also setting up its used car business with its own financial services.

This proves that BMW no more wants to be a niche player in the premium segment. The company is planning to leverage its Ultimate Driving Machine to a bigger market. There is a huge potential in the premium car segment in India that is still untapped. This segment of consumers is actually confused. They expected a real premium brand to satisfy their Self Esteem and were not ready to shell out the real price for it. It seems like BMW understood this and is acting fast. Before the traditional rivals Mercedes and Audi could possibly enter this segment BMW wants to grab a maximum market share.

Now the Accords, Passats and Superbs have to worry. Can they compete against an Ultimate Driving Machine. But for a consumer like me, who dreams of owning a BMW one day, it seems like the day is not too far.

When Mercedes India proudly said they are back at No.1 after Jan 2010 sales, the BMW India CEO replied, 'There are still 11 months to go'.

What a statement !!!

the conFUSION is now gone...

Ford India has taken a wise decision to axe Fusion. Though the model hardly sold in the last few months, the decision had come at the right time before Figo hitting the showrooms in the first week of march. This is a wise decision because, the cars look somewhat similar from certain angles.

The biggest mistake in Fusion was its pricing. At 6.5 lakhs to 8 lakhs, there were more exciting models available in the market. And its station wagon like feel, confused the buyers and hardly drove in customers. Also Ford did not push the brand much as it did for Fiesta or Ikon. There was nothing to remember like 'The Josh Machine' or 'Go Fida'.

With the same platform and the same wheelbase as in Fiesta, the Figo is all set to go at an expected price range of 3.5 to 5 lakhs. This should be ideal for a car like this. It seems like now Ford is clear in what it is offering to the market and what it is expecting from the market. So, the conFUSION is finally gone.

Is it time for FIAT?

There are mixed news about Fiat India, ripping Palio. Though Palio sells a meagre 50 units every month in the 2000 units that Fiat sells via its Tata-Fiat dealerships, its the entry level hatchback that the company offers against the Indica and Swift. Logically, its been some time that the model is around and it needs a major upgrade. Fiat, as of now have not mentioned anything about Palio meeting the BS IV norms which means the model may be discontinued.

Now, this can be good from profitability point of view. But a company which has Ferrari and Mesarati in its portfolio is not ready to play a solo innings. Punto cannot survive against Indica Vista and Linea cannot fight Indigo Manza when presented to a typical customer. The Tatas are strong in their utility ratio. Though its the same engine in all these cars, Tatas score on the value for money column. So presenting them next to each other is not a good idea. Now that the Punto and Linea have gained a market for themselves to sustain, its time for Fiat to move on.

Fiat on the other side have released pictures of an all new Palio. As I've mentioned in my earlier post, though its not very clear on the next move with Palio, for the company to taste its share of the small car boom in India, its time to go alone.

Will ARIA be another winner?

Tata announced its entry into the MPV segment with Indicruz in early 2008. And now after the actual revelation of the vehicle as Aria powered by the popular 2.2 DICOR engine, the MPV market is getting geared up. The other players in this crossover segment are Innova, with a leading market share and Xylo following it.

But for the first time, it was surprising to see Tata going ahead of competitiors with Aria. The vehicle is priced at around Rs 12 lakhs to Rs 14 lakhs. Though it is fully loaded with features like 4 wheel drive, GPS, Parking sensors, dual ACs, 6 Airbags, ABS, head mounted LCDs, etc., which justifies this cost, its quite interesting to see the way Tata wants to position this vehicle. It seems like Tata wants to position this for a premium segment in the SUV target market.

But, there is a check. At this price point, customers would expect the car to be of a better quality than Innova. And customers perceive Tata cars are always not comparable with Japanese or European cars. This perception of the brand may demean the image Aria wanted to enjoy. The way Tata is going to address this gap will decide the success rate of Aria.

This will also test the strength of brand Tata and its marketing abities in this new segment. The live example for this from Tata's stable is the Safari. Though Safari was positioned at a premium segment through its communications, the product quality never met the expectations of the consumers in its segment. Though not a  failure neither was it a success. Hope Tata took some lessons from it and play the game differently.

A true CLEAN Performance - Hybrid from Porsche

Audi @ this Olympics

Automakers Beware!!!

Case 1:
Last week a friend of mine booked a Thunderbird. The choice was made by his Fiancée. Sweet isn't it.

Lesson 1:
Its no more the target segment that matters. Need to attract the influencer too. In reality as found by Volvo during its Your Concept Car (Refer here for details), an influencer, especially women, make a huge impact, even in the purchase of vehicles designed for a niche target of men Eg: Thunderbird. So automakers, expand your target segment.

Case 2:
Another friend of mine decided to gift his father an SUV. The discussion narrowed down on Toyota Fortuner or Ford Endeavour. A previous poor experience from a Ford dealer on his Ikon resulted in going for the Toyota. No second thought.

Lesson 2:
Just opening up dealerships or setting up service centers doesn't work anymore. The people P has a critical place in the business. So train people at dealerships and service centers to handle people better than handling cars. One lost opportunity to serve is a customer lost forever.

So automakers beware!!!

The End of an Era

Lets first go to 1984. The real transformation of Indian Automobile industry. When the consumers had no choice other than the Ambassadors and Premier Padminis, Maruti with Suzuki brought in the legendary M800. With a 796cc, naturally aspirated petrol engine, M800 was the King of Indian roads till its sibling Alto took the throne in 2004. Even then it was just the second most selling car.

Then came in the emission norms. The company, after looking at the cost involved in upgrading the engines to meet the Euro IV norms, decided to axe the car in a phased manner. Its first happening in 13 cities.

In less than 5 years M800 would be history.

Though no big changes were made in 26 years, the car always underwent minor face-lifts and technical upgrades like factory fitted LPG/CNG kits to sustain its Numero Uno status. Its the M800 that comes into the mind first when one thinks of Maruti.

How did this happen?

Initially there was no huge competition in this segment. The customers actually had no choice. But as the market evolved, to stay in the race, Maruti kept updating the car. As the industry grew, the product also grew. The product never entered the maturity stage. Though there were bigger and more efficient offerings in the market, none were able to take M800 head on. This was actually because of the reliability the product had shown over time. This translated into Maruti's other products and the result is a whooping 50% market share. This product again demostrated the power of the product P ahead of the other Ps in automobile industry.

The only possible successor to this throne is the Nano. Lets see, if it can become the next Darling of the Masses. Time will tell.

The New BMW X1 - Cheapest BMW on Indian Roads

Why all the eggs in the same basket?

TVS had announced the launched of RTR 220cc. Again a case of squeezing the cow to the fullest. This time on the upper side. The new RTR 220cc is expected to feature ABS, a first in India. After a close to washout in the entry level and commuter segment, TVS had just decided to gain the max from its only running horse. Why cant a company who had Shoguns and Samurais, create a competitive product.

TVS should learn from Yamaha instead of following Bajaj. Other than RTR, it should bring its racing passion back in its riders. Make a new entry in the 100cc and 150cc segment. Strategically, TVS should focus more on R&D. Also TVS is typically seen as a South Indian company and is never a huge brand in the rest of India. So it should also focus on re-establishing its brand image.

TVS should ideally go back to the basics. Identify a target segment, capitalise on it and lead the market, rather than trying to find a place in all the segments.

Not just the Hatchbacks...

Rolls Royce Ghost - 2.5 crores - 60 cars since December 2009

Mercedes SLS AMG - 2 crores - 5 cars since January Auto Expo at Delhi

Porsche Panamera - 1.5 to 2.0 crores - 50 cars from Oct 2009 - Dec 2009

Need to say more?

Its not only the hatchback segment thats booming in India. India is also attracting the luxury car makers. Its no more that the phased out versions of these manufacturers will come for us. Its again in line with the global launch of these models. While the bottom of the pyramid is growing, its also the top of the pyramid growing.

All we need to see is, if this growth is sustainable or its just a temproary boom.

Too much of anything is Good for nothing

Renault had decided to review its JV with M&M. After a disastrous performance of the Logan, and Nissan coming with huge plans, nobody would have expected such an announcement. So in India Renault will be with...

1. M&M for an upgraded Logan,
2. Nissan for Micra and future launches
3. Bajaj and Nissan for the small car project

Will this work? One country. One company. Three partners.

I really wonder, how can a company, who had still not landed up safely in Indian market, can make such a move. The culture of three different organisations and three different target markets will rip Renault more than its current form. This just shows the desperation Renault has to gain roots. Its rather wise to focus and get one opportunity on track than exploiting everything available.

Is Figo planning to be a silent killer??

Ford announced that Figo will be launched in March 2010. While Figo had to go head on with Chevy's Beat and  yet to come Polo from VW, Ford has chosen to be very conservative in its marketing strategies.

When Volkswagen announced Polo, it started its brand building exercise much earlier. Similarly when GM launched Beat, though there were no big ATLs, there were enough BTLs taking place. Also, both these brands took place in the recent Auto Expo at Delhi. But in contrast, though Figo was announced for the Indian market almost during the same time like the competitors, there was never a great promo in place.Ford also needed a brand building exercise as the brand is perceived to have high running costs.

But after the recent announcement of Ford, it seems like, the company is trying to get the basics right. In automobile industry, if the product P is right, then the success rate is high. Figo, I would say is more suited for a Indian consumer in terms of value for money. Its more reliable and seems to have a better utility value.

Having said all this, lets see how the 'new blue oval' is going to fair against its German and Japanese rivals.

Fazer - Freedom

Biggest Marketing crime by the Japanese

In automobile industry, its always the product P which has a dominant status. Once the product is acceptable then irrespective of the other Ps, the product becomes a winner. The company which demonstrated this to the world more than any other company is now suffering with the same problem.

Its Toyota.

Recalling close to 8 million vehicles, more than its total 2009 sales (Source), Toyota had committed a major marketing crime. It was through the quality and reliability that Toyota redefined, it became the worlds No.1. The company that taught the world JIT, is now suffering because of a quality issue from its supplier. This probably could be an outcome of its cost cutting efforts.

This might possibly be the end of the Japanese dominance in the US market after a similar announcement from Honda. And the impact can be even worse if the other European and Asian countries also react. Even when GM filed for bankruptcy, neither anyone blamed the company nor its brand equity went down. And with the revival strategies, GM will be soon on track. But its not going to be easy for the Japanese. And this might well reflect on other products from Japan.

Now its upto Toyota and Honda, on what strategy they are going to frame to re-establish their lost pride.

Has Bajaj pressed the Panic button?

I think Yes!!!

Bajaj recently introduced the naked version of Pulsar 220. Its the same 220 engine on a discontinued P200 platform. It borrows mechanicals from carburetted P220 and the front fairing from P200. Just that the engine fairing is removed, the bike has gone a bit lighter and is expected to be better in handling and performance.

But why is Bajaj doing this? One side the brand is extended downwards (Courtesy: Pulsar 135LS). On the other side, in the premium segment, its just another cosmetic change in the form of Naked P220. Because of the tough competition from Honda and Yamaha in the premium segment and the market leader Hero Honda in the executive and commuter segment, Bajaj had pushed the panic button.

Pulsar is the only successful brand in the last 9 years. The company could not reproduce the success again in almost a decade. This has resulted in leveraging the brand equity of Pulsar to the fullest. Now consumers will fail to understand the brand DNA. As a result Pulsar may loose its value and image from the minds of the consumer and go out of the consideration set.

Watch how Skoda positions itself...

Ford Figo - Fully Loaded

Will a Retail Format work...?

According to Economic Times report, World's largest auto retail stores are planning to enter the second fastest growing automobile market, India. Autonation from US, Inchcape from Europe, Oman's Saud Bahwan, UAEs Al Futtaim Motors are all in talks with leading car makers to set up retail stores in India. But will this work here?

I think its a big NO. Why?

The automobile market in India, though expected to grow at 15% to 20% annually, is not a matured market like US or Europe. For Indian consumers buying a car, falls in the high involvement purchase relatively more than the consumers of the developed world. So a typical Indian consumer would always want it from a authorized company showroom than from a multi branded  retail outlet. Its always the company showrooms that will be perceived to be better and hassle free. This will be evident from the after sales service pattern in India. Other than the Indian brands Tata and Maruti, there will be hardly any other brand getting serviced out of the authorized showroom. Indian consumers never wanted to take a chance.

Indian market does not have many brands like Ford, Toyota or GM has in US and UK. The company with the largest  product portfolio is Maruti Suzuki. Also in India its only the small car market which is growing at a fast rate unlike other countries where sedans and SUVs also have a good share. Having said all these, the profitability of these stores will be at stake with price competition and high operating costs.

So, for any company in India, its ideal, not to go for retail stores format. Instead companies can invest in setting up more dealerships and expand their service networks.

New AUDI A6

Resurrection of the King

Many, like me, would love to read the news again and again. Some may postpone their decision to buy a bike after reading this. According to Business Standard Motoring, Yamaha had planned to reinvent the legendary RX 100 in a new 4 stroke avatar. So back are days of street racing and high performance rides.

Yamaha ruled the market with this superbike. When there was a strict ban on this bike for its high pollution, unlike others like Suzuki and Kawasaki, Yamaha decide to axe the brand. The successor, RX 135, though matched its performance levels, did not win the share of the consumers heart. And thus the downfall began for Yamaha. Recently after a complete turnaround with its new range of bikes, Yamaha has re-defined the premium segment again. Yamaha did what Bajaj did in the past with Pulsar. The R15s and FZs fed the hungry indian youths. But still in the entry segment of 100cc to 125cc, Yamaha did not make any attempt. If RX 100 in its 4 stroke version is able to meet the needs of this segment, then their target of 10% market share will be achieved in no time.

Is this the beginning of the end for Maruti?

Till 2009, every second car sold in India was from Maruti Suzuki's showroom. Will 2010 see the same pattern? In the entry level segment, with 800 being phased out in 11 cities from April 2010, Alto and Estilo had to survive Chevy Beat and much awaited Ford Figo. In the premium hatchback segment, Swift and Ritz will compete against Volkswagen Polo, Revamped Fiat Grande Punto, yet to come Toyota Etios and the Honda's concept small car along with the Indica. After this never seen before competition in the small car market, will Maruti sustain its 47% market share?

The success of Maruti was not only its pricing strategy. It had won the trust of Indian consumers through its product quality and service quality. With the largest spread of distribution network for sales and spares anything for Maruti was available anywhere. But will todays consumer be happy with this? They need the latest in the market, customised, trendy along with performance. Maruti reacted to this competition last week by announcing a reduction in its small cars from Rs 30K to Rs 50K. Also they have introduced a MUV in the price of an Alto. The customers neither wanted a price reduction nor a MUV in this segment.

Maruti has to repeat history. It should do, what it did in 1984. A revamp in its product line. New products with a premium price tag also will be well accepted. With the help of Suzuki, it should bring in more brands from the Japanese roads tweaked to Indian conditions. A mere price reduction on the existing models will not help the company sustain this market lead. Hope the Nations brand does a successful fightback in this turbulence.

A new beginning @ Delhi

Till early 1990s the Indian automobile industry was almost 20 years behind the rest of the world. A technology which was in use in Germany, Europe and US was available not earlier than 20 years for Indian consumers. Late 90s situation started changing and now many global gaints like GM, Ford, Toyota, Honda and Hyundai launch their new cars first in India and then to the world. Indian automobile industry is all set for the next era.

Today Delhi witnessed the new innings of Indian automobile industry. In the first day at the Delhi Auto Expo 2010, major car manufacturers unveiled their range, specially designed for India. Toyota displayed the Etios, GM launched Beat a day earlier, Honda has unveiled their small car, Volkswagen Polo made its much expected entry while the other German rivals Audi, Mercedes and BMW showcased their offers in the premium segment.

The great Indian gaints, Tata Motors and Maruti proved that they are no inferior. Tata launched its premium MPV Aria and Ventura while Maruti Suzuki displayed its RIII concept.

Lets wait and watch the following days for more news and launches.

Toyota Etios - Teaser

Where did Jazz go wrong?

Honda introduced Jazz as a premium hatchback. Around 8 Lakhs, Jazz was competing with i20 and Fabia, which are also positioned for the same target segment. Jazz, from Hondas' stable, had typical Honda quality and refinement, much above its competitors. The space the car offered was the best in its class. Along with the Honda ownership card, Honda would have expected the Jazz to sweep the market. But it did not happen.

Honda from a layman's view is a mini MUV. It looks like a downsized Innova type. But during the launch, the company positioned it against the hatchbacks. The size and dimensions did not support this claim along with the price. The price was way high for this segment. When the i20 is available with a fully loaded automatic transmission option for 8 lakhs, consumers were reluctant to pay almost the same price just for the brand Honda. This is evident from the sales figures available for the month of November 2009. When i20 did very well by selling 3582 units, Jazz managed just 546 units.

Zeroing down on the problem, it's a Positioning Vs Pricing war, where Jazz lost its plot. If Jazz was positioned as a hatchback, it should have been priced a bit low around 7 lakhs range. If the company wants to enjoy this premium, then it should have been positioned as a Mini MUV.

Honda has realised this and had offered a flat Rs 40,000 off on Jazz for Jan 2010. This is the first model from Honda to get this kind of an offer. Rather than getting into this discount game, Honda can manage its premium tag by revising the price for ever.

Will Fluence have enough Influence?

Renault had decided to launch its Fluence in India, a new saloon, by the end of 2010. Around Rs 12 Lakhs, this car would be positioned in the entry level premium saloons alongside Corolla, Octavia and Civic. But will this change the fortunes of Renault in India?

Renault with its Logan had already been positioned in the minds of the Indian consumers as a cheap car maker with no great R&D. Though globally it is acclaimed that Renault is a potential manufacturer, the mistakes in Logan (as discussed in the earlier post), have ruined the brand image in India. So before the launch, Renault should first make an attempt to change the perception of the brand through brand building exercises. Otherwise, the Fluence will fail to sail along.