MARUTI SUZUKI Direct competitors:

Maruti Suzuki (Model 1-Maruti 800, model 2 Maruti Zen)

Maruti Udyog is Indias largest automobile company. The company is a joint venture with Suzuki of Japan, and has written a runaway success story. When Maruti entered the Indian car market, it sought to provide high quality fuelefficient, lowcost vehicles and total customer satisfaction. These objectives shaped the companys policies and approach to quantity.

The first cars rolled out from Maruti Udyog on 14th December 1983, marking the beginning of a revolution in the Indian automobile industry.

The Indian car market had stagnated at a volume of 30,000 or 40,000 cars a year for the decade ending 1983. In 1993, this figure reached a number of 1,96,820. Marutis figures were a different story altogether. The company reached a total production of one million vehicles in March 1994, becoming the first Indian company to cross this milestone. They crossed the two million mark in 1997

For the year ended 1997-98, Maruti posted a turnover of US$ 2.1 billion and a Profit before tax of I US$ 244 million. During the year, Maruti produced over 3,50,000 vehicles, out of which 26,000 were exported. Maruti has made profit in every since inspection, and has been paying dividends for the last ten years.

Through the years, Maruti has provided world-class contemporary Japanese technology, suitably adapted to Indian conditions arid Indian car users. They have also provided users with a range of ears to suit different needs. Marutis market share shows the response of customers. In 1997-98, their market share of vehicles was 83 per cent. Maruti has a 97 per cent share in the economy segment of the car market.

With many international automobile majors setting up base in India, the company expects intense competition. And they welcome the transition from a sellers market to a buyers market. In this environment, only firms that have a strong supplier base and aftersales network will survive. MUL has its strength in 174 dealer outlets and 1210 authorized service centers across 471 cities.

 As for the future, Maruti has embarked on a drive that will keep them ahead of the completion. Recently, a Rs 4 billion expansion project was completed at the current site. This has the total production capacity to over 3,20, 000 x chides per annum.

Suzuki has agreed to further modernize the existing facilities and to augment capacity by 1,00,000 units in the year 1998-99

The companys total production will exceed 4,00,000 vehicles per year. And the total investment of Rs.18billion reflects the companys will to smoothly ride into the next millennium

Maruti 800 a hatchback car actually is 796cc.was introduced in dec83 was re-launched in a different shape and with new technology in April 86, Sep97 and Jan 98.

Maruti800 is 95% indigenised.

The company had developed an extensive network of after sales service centers compromising 123 dealers, 161 sales outlets (covering 93 cities), 194 dealer workshop and 868 Maruti authorized service stations besides 204 spare parts outlets including 26 stockiest (covering 421 cities in India). Maruti has exported over 1.9 lacs vehicles to more than 100 countries (till October 1998), 75% of this has been sent to Europe.

Maruti launched the Zen, which was a small car at a high price than Maruti800 and having better quality. It was designed to tap the higher income group who were looking for a higher quality small car. It plugged the gap between Maruti 800 and Maruti Esteem.

Maruti has mainly focused on the small car segment rightly identifying the latent need for a low price, efficient quality car. This segment is the largest of all segments and has the buying potential, since most of the people in this segment were salary earners; Maruti is the first company to come out with a car-financing scheme.

More than 50% of those who buy Maruti 800 are up graders from two wheelers and Zen has Ken positioned as a high quality car in the upper end of the same segment and together these ~ o dominate the small car market.

Indirect competitors:
Fiat (Model- palio/palio weekend):

The palio is fiats world car for developing markets of six available body styles a hatchback like indica (they shared the same design house) and a station wagon may be launched. The Car wont be called the weekend here, as it would amount to wrong positioning.

The models may come with 1.3liter petrol and 1.7 liter turbo-diesel engines. Expected price Rs 4-lakh

Maruti udyog (Model-Wagonr):

Maruti could well position this as the Santro killer. The wagon r is japans best selling model and was one of the early cars to sport the tall boy design to increase internal space without increasing the length or width of the car, However there is a vast difference in the looks of Wagon r with Tata Indica and even with the Santro. The first Wagon r was offered with a 600cc petrol engine and but now both 1.0 and 2.0 liter are available in India the model being offered is the 1.0 petrol engine.

Hindustan motors/proton (Model-persona Compact):

The Malaysian car company is certainly keen to get into India fast it is talking to Hindustan about using the latters facilities for assembling a proton model and is also going ahead with plans for a 100% owned subsidiary. Proton can make an entry through either the compact modelwhich is basically an extension of the Zen classor the larger Persona. Both cars come with numerous engine options and can be expected to fragment an already fragmented market future.

Expected time of launch-mid-2000

Expected price 4-6 lakh.

THE PRODUCT LIFE CYCLE STAGES OF MARUTI SUZUKI

THE PRODUCT LIFE CYCLE A product's life cycle (PLC) can be divided into several stages characterized by the revenue generated by the product. The life cycle concept may apply to a brand or to a category of product. Its duration may be as short as a few months for a fad item or a century or more for product categories such as the gasolinepowered automobile. Product development is the incubation stage of the product life cycle. There are no sales and the firm prepares to introduce the product. As the product progresses through its life cycle, changes in the marketing mix usually are required in order to adjust to the evolving challenges and opportunities. The four stages of product life cycle are: 1. Introduction stage 2. Growth stage 3. Maturity stage 4. Decline stage Nonetheless, the product life cycle concept helps marketing managers to plan alternate marketing strategies to address the challenges that their products are likely to face. It also is useful for monitoring sales results over time and comparing them to those of products having a similar life cycle.

INTRODUCTION STAGE When the product is introduced, sales will be low until customers become aware of the product and its benefits. Some firms may announce their product before it is introduced, but such announcements also alert competitors and remove the element of surprise. Advertising costs typically are high during this stage in order to rapidly Increase customer awareness of the product and to target the early adopters. During the introductory stage the firm is likely to incur additional costs associated with the initial distribution of the product. These higher costs coupled with a low sales volume usually make the introduction stage a period of negative profits. During the introduction stage, the primary goal is to establish a market and build primary demand for the product class. In the introduction stage, the firm seeks to build product awareness & develop a market for a product. The impact on the marketing mix is as follows:

Product:- Branding & quality level is established & intellectual property protection such as patents & trademarks are obtained. Pricing :- The pricing strategy maybe one of low penetration pricing to build market share rapidly, or high skim pricing to recover development costs. Distribution :- It is selective until consumers show acceptance of the product. Promotion :-It is primarily aimed at innovators & early adopters. Marketers seek to build product awareness & to educate potential consumers about the product.

GROWTH STAGE In the growth stage, the firm seeks to build brand preference & increase market share. The impact on the marketing mix is as follows: Product :- The product quality is maintained and additional features & support services maybe added. Pricing :-The price is maintained because the firm enjoys increasing demand with little or no competition. Distribution :-Sales channels are diversified & increased as demand increases &consumers start accepting the product more & more. Promotion :- It is aimed at a broader audience.

MATURITY STAGE At maturity, the strong growth in sales diminishes. Competitors may appear with similar products. The primary aim at this stage is to defend market share while maximizing profits.

DECLINE STAGE Sales show a downward drift and profits erode. Sales decline for a number of reasons, including technological advances, shifts in consumer tastes, and increased domestic and foreign competition. All lead to overcapacity, increased price-cutting, and profit erosion. The decline might be slow, as in the case of sewing machines; or rapid as in the case of the disks. Sales may plunge to zero, or they may petrify at a low lever.

Product Life Cycle stage of Maruti Zen A brand that ruled the Indian mid segment car market will be laid to rest very soon. Maruthi Zenwhich was considered to be one of the best cars on the Indian roads after a long life of 13 years have become redundant. It is a sad news for all Zen owners who still vouch for this hatchback. Marketers will also be sad because it was a marketing failure and not a product failure. The goodold zen is still valued as precious by its owners. Zen was launched in India in 1993. Instantly this premium car became the favorite of the upwardly mobile Indian middle class. The was something special about this jelly bean shaped car and the driving and maneuvering quality was nothing but superb. In cities where there is bumper to bumper traffic, the Zen was the most preferred one. During the nineties all the cars from Maruti ruled the segment because of lack of competition. Then came Santro and Zen had a competition. Although initially people scoffed at the tall boydesign of Santro, slowly through smart marketing, Santro began to eat into Zen's market. Then came the major blow in the form of Indica which changed the rules of the game in the hatchback segment. Zen came out with Zen LXi in 2001, but the market share was slowly declining. The major reason being, the owners of Zen were getting older and Zen was missing out on the new generation. There was no excitement about Zen. Maruti is a poor marketer with good

products. All their products are of exceptional quality and all their marketing campaigns (including the campaign of new Swift) is exceptionally poor. Customers buy it because it is good. While the competitors are gaining the share of mind of consumers using smart marketing campaigns, Zen was no where in the picture. The launch of Zen with round headlamps was amajor disaster.During 1999, Maruti launched Wagon R and 2000 saw the launch of Alto, With these products, Zen was left in a no man's land. The segmentation became fussy. Since there was no clear... Wagon R is one of the largest selling brands in the Indian car market. The brand is currently in its maturity stage and Maruti is all set to put Wagon R again into the growth path. The brand has roped in Madhavan as the brand ambassador. The brand hopes that the endorsement from the star will create a new growth path for it.

STEPS TAKEN BY MARUTI SUZUKI

1. During its pre-maturity stage