Professional Documents
Culture Documents
TVS Sales Promotion
TVS Sales Promotion
BANGALORE
Under Guidance of
SRM University
Faculty of Management
Kattankulathur - 603203
2017
INDEX
2 1.1. Introduction 1
7 1.6. Limitations 3
8 1.7. Chapterization 4
9 CHAPTER - 2 5-9
10 Literature Review 5
11 CHAPTER - 3 10 - 13
14 CHAPTER - 4 14
17 CHAPTER - 5 15 - 25
19 5.2. Findings 24
20 5.3. Suggestions 25
21 ANNEXURE 27
22 BIBLIOGRAPHY 28
List of Tables
Sales promotion is the process of persuading a potential customer to buy the product.
Sales promotion is designed to be used as a short-term tactic to boost sales, it is rarely suitable as a
method of building long-term customer loyalty.
Sales promotion consists of a diverse collection of incentive tools, mostly short term,
designed to stimulate quicker and greater purchase of a particular product by consumers. Sales
promotion emphasis the customer to get action. Sales promotion is used to increase the sales of a
particular product.
1
To target students and to increase the sales TVS motors organise many road shows in colleges and
near shopping malls.
1. Price packs :
This is one of the promotional activity done by TVS. In this consumers are offered a reduction
in the regular price of the bike and other products. Here two or more products are given together at
the price of one.
2. Promotional gifts :
Tvs motors offers free bike accessories to the customers to attract and offering foreign tours
for the best customers.
3. Assurance:
Assurance is a Extended Warranty program aimed at enhancing the overall customer experience by
adding more Warranty years to the product and thus assuring hassle free riding for up to 5 years.
4. Easy Finance :
Tvs motors offers easy finance option with low interest rate, repayment option from 12 to 48 months.
The need of study is only for organisation level. It is for to understand the effect of
sales promotions and how it affects the consumers buying decisions.
2
1.4. Objectives of the study :
This study program has got the following objectives :
1. The results could not be applied widely without making appropriate changes for cultural and
regional expectations since the study was conducted in limited area.
2. The accuracy of the results are not accuracy because of small sample size.
3. The money and other resources at the disposal of the researcher were limited and a detailed
study was not possible.
3
3
1.6. Chapterisation :
Chapter 1 : Introduction includes meaning of the study, scope of the study, objectives of the study,
limitations of the study.
4
CHAPTER - 2
Chapter - 2
LITERATURE REVIEW
Sales promotion has become an integral part of the promotion schemes of both manufacturers
and retailers of durable as well as non-durable consumer goods. It consumes a very significant portion of the
promotional expenses of marketers. In some of the developed countries allocation of promotion budget to
sales promotion has far exceeded spending on advertisement. Brand managers are now relying heavily on
sales promotion because its impact on sales is more direct, immediate, and quantifiable as compared to
advertisement. Marketers use both price and non-price promotions either independently or in association
with each other. Price promotions allow buyers to make some savings of money where as non-price
promotions like premium add value to the offer. Point-of-Purchase promotions like feature advertisements
and displays lead to impulse buying. The dynamic nature of sales promotion has inspired many researchers
to turn their attention to study the various issues related to this element of promotion mix. Many studies have
been conducted on the planning, implementation and evaluation aspect of sales promotion worldwide. These
studies are reviewed and presented briefly under suitable heads like Studies on Consumer Promotion, Studies
on Sales Force Promotion, Studies on Trade Promotion and Other Studies on Promotion.
Majority of the studies on sales promotion encompass consumer sales promotion strategies of
marketers. Consumer sales promotion techniques are also called 'pull strategies' as they attract or pull
customers towards the promoted brand or promoted store as the case may be. According to one study,
consumer sales promotions are the most researched topic ahead of trade promotion and sale force promotion.
Important issues examined in these studies include the consumer's perception of marketers sales promotion
activities, effect of promotion on consumption, trial purchase, category expansion, brand switching, brand
evaluations, stock piling and consumption relationship, long term impact of promotions, incentive-outlay
ratio, etc. Consumer sales promotion literatures are M e r classified in to three categories, viz.l.Studies on
Impact of Sales promotion; 2.Studies on Perception about Sales Promotion; and 3. Sales Promotion
Evaluation,
Relationship and Other Aspects.
Studies relating to the impact of consumer sales promotion on consumer behavior, sales, profit,
market share, etc. are included in this section. These studies provide guidelines to managers on various issues
such as the appropriate tools that may be used for achieving a specific marketing objective, improve their
sales promotion effectiveness and so on.
5
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Vecchio, Del, Devon et.al. (2006) ' report the results of the study, which examined the effect of
sales promotion on brand preference through Meta analysis. Results of 51 studies had been integrated. As per
the study sales promotions do not affect post promotion brand preferences in general. But depending upon
characteristics of sales promotion and the promoted product, promotion can either increase or decrease
preference for a brand.
Ndubisi, Oly, Nelson and Moi, Tung, Chiew (2005) in their study evaluated the impact of sales
promotional tools, namely coupon, price discount, free sample, bonus pack, and in-store display, on product
trial and repurchase behaviour of consumers. The moderation role of fear of losing face on the relationship
between the sales promotional tools and product trial was also examined. The results of study show that price
discounts, fiee samples, bonus packs, and in-store display are associated with product trial. Coupon does not
have any significant effect on product trial. Trial determines repurchase behaviour and also mediates in the
relationship between sales promotions and repurchase. Fear of losing face significantly moderates the
relationship between in-store display and product trial.
Kumar, V. and Swaminathan, Srinivasan (2005) 'studied the impact of coupons on brand sale and
how that impact decays over the life of the coupon. The authors use an econometric model to demonstrate
the coupon effect in terms of equivalent price reduction, account for coupon effect over time, allow inference
of coupon effects when retailers decide to double or triple the coupon value and provide both self-coupon
and cross-coupon elasticities at different levels of aggregation. Results indicate that the effect of doubling the
face value of coupon result in more than a proportionate increase in elasticity and both self and cross-
coupon elasticities are much smaller in magnitude than the average self-cross price elasticity.
Laroche, Michel et.al. (2005) 'studied the effect of coupons on consumer's brand categorisation
and choice process using fast-food restaurants in China. Results suggest that there are both direct and cross-
advertising effects i.e., the presence of a coupon for a focal brand has an impact on consumer's attitudes and
intentions towards that brand.
Lewis, Michel (2004) developed an approach for simultaneous measurement of the influence of a
dynamic loyalty programme and more traditional short- term promotions. They argue that the loyalty
programmes under examination successfblly alter behavior and increase retention rates. E- mail based
coupons, shipping fee and general price levels all significantly affect customers purchase decisions.
Anderson, T. Eric and Simester LDuncan (2004) investigated how the depth of a current price promotion
affect future purchasing of first time and established customers based on three large scale field experiments
on durable goods sold through a direct male catalogue. The findings reveal different effect for first-time and
established customers. Deeper price discounts in the current period increased future purchases by the first
time customers (a positive long-run effect) but reduced future purchases by established customers (a negative
long- run effect)
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Dawes, John (2004) 'reported the result of his study on the effect of a massively successfbl price
promotion in a consumer goods category. Specifically, he sought to determine if this large price promotion
had any long-term impact on brand value; short-term impact on total category volume for the retailer; short-
term effect on competing retailers; and long-term effect on category sales for the retailer who runs the
promotion. Results of the study showed that a very successful promotion did not have any longer-term effect
on the brand (positive or negative), but it did expand the total category for the Retailer, though temporarily.
Sales dropped slightly for one competing retailer at the time of promotion out of the three units studied. It
was observed that the promotion was followed by a decline in the total category volume for the retailer,
suggesting some degree of purchase acceleration or stockpiling by consumers, Longer-term negative effect
on category cancelled out approximately two-third of the gain of the price promotion to the retailer.
Boohooing et.Al. (2003) 'reviewed various studies relating to the impact of promotion on brand
switching and found that these studies used choice models, especially logit. According to these studies
promotion has a strong effect on brand switching. The authors show that logit choice model can substantially
over estimate brand switching because they do not take in to account the rational adjustments that customers
make to take advantage of promotion. Logit models do not take in to account stock piling and deceleration
strategies. They use a dynamic rational model and compare it with a logit model. The result was that logit
models over estimate brand switching, that nested logit helps address the problem but not completely and
that dynamic rational model provide the most accurate estimate of switching.
Swait, Jofie and Erden, Tulin (2002) in their study focused on a particular aspect of marketing mix
consistency overtime for frequently purchased packaged consumer goods, the impact of temporal
consistency of store promotions as well as the availability of the product on the shelf; on consumer product
evaluations (utilities) and choices. The empirical results, based on fabric softener panel data, indicate that
hture insert and availability consistency increase systematic utility in a statistically significant way over and
above the positive effects that displays and feature have on choice.
Soman, Dilip and Gourville, T. John (2001) 'O investigated how and why price bundling affect
the consumption of a service based product such as a sporting event or a theatre performance. The results of
the study showed that price bundling leads to a decoupling of the sunk cost and pending benefits of a
transaction there by reducing the likelihood of down stream consumption.
Smith, F. Michael and Sinha, Indrajit (2000) *l examined the relationship between different types of
promotions (straight price promotion, extra-product or volume promotion and mixed promotion) across four
supermarket product categories controlling separately for the effect of two category-based moderating factors
viz. product stock-up characteristics and price level. Results showed that a majority of consumers preferred
mixed promotions ; type of promotions does influence store preference (with price and volume promotions
having the greatest influence). Consumers generally preferred price promotion for higher priced product
categories and they preferred volume promotions for lower priced categories.
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Feame, Andrew et.Al. (1999) l2 studied the impact of promotions on the demand for spirits
category in the UK market. The results of an econometric analysis of weekly cross-sectional store data and
cluster analysis of consumer panel data suggested that promotions have had a slight positive impact on the
volume of sales, particularly over the seasonally important Christmas period. Some promotions, especially
multi-buys, reward largely loyal buyers, doing little for either volume or monetary growth of the spirit
category. Other promotions, such as price and gift offers, appeal more to consumers who do not purchase
spirits so frequently and also attract people who are less brand and store loyal.
N Ailawadi, L. Kusum and Nelsin, A Scott (1998) l3 empirically demonstrated the existence of
flexible consumption rate in packaged goods products, how this phenomenon could be modeled and its
importance in assessing the effectiveness of sales promotion. Results of their study show that sales
promotion increases consumption because of higher usage rate and stockpiling.
Mela, F. Carl. Et.Al. (1997) l4 examined the long-term effect of promotion and advertising on
consumer's brand choice behaviour. They addressed two questions: 1. Do consumers respond to marketing
mix variables such as price changes over a long period of time? 2. If yes, are these changes associated with
change in manufacturer's advertising and retailer's promotional policies? Their results are consistent with the
hypothesis that consumers become more price and promotion sensitive over time because of reduced
advertising and increased promotions.
Gould, W. Brim (1997) in his study, focused on the dynamics of the consumer purchase process
and examined the effect of coupon-based price deals on inter purchase times. He used econometric models of
duration to a formally purchased food commodity, cheese. Results suggested that use of coupon results in
reduced inter-purchase time for all varieties of cheese
products.
Sethuraman, Raj (1996) l6 developed a Separate Effect Model that separates the total discount
effect of competing high-priced brand on the sale of the focal low-priced brands in to discount effect.
Findings fiom empirical analysis is that the leading national brand can draw sales fiom competing brands
without reducing its price below the price of other brands.
Jefii-y, J. and Mc.Alister, Leigh (1994) l7 tested the hypothesis that coupon redemptions are
greatest in the periods immediately following the coupon drop and decline monotonically. As per the study
the hypothesis was rejected and it was proved that expiration dates induce a second mode in the redemption
pattern just prior to the expiration dates.
Grover, Rajiv and Srinivasan, V. (1992) l* investigated the multiple effect of retail promotion on
brand loyal and brand switching segment of consumer. They found that the market can be characterised by
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brand loyal segment and switching segments; promotional variable have significant effects on segment
market shares, the effect being different across segments; store share is related significantly to promotional
attractiveness of a store; the overall promotional attractiveness of the product category has significant current
and lagged effect on category volume and the lagged effects resulting from consumer purchase acceleration
and stock-up last longer for brand loyalsegments than for switching segments.
Kahn, E. Barbara and Loouise, A. Therse (1990) l9 investigated how in-store price promotions
affect market share after the promotion have been retracted. They find that the effects of promotion are
contingent on both the choice pattern of subjects- whether or not subjects switch among brands- and the
ubiquity of promotions in a product category. If only one brand is being promoted and subjects are generally
loyal to the last brand purchased, brand choice probability declines from pre-promotion levels once the
promotion is withdrawn. However if subjects tend to switch among brands in the absence of promotion, or
several brands are being promoted, this decline is mitigated andlor does not occur.
Guptha, Sunil (1988) 20 explains how sales promotion affect consumer's purchase decisions and
thus the sale of a brand. He argues that the effect of a sales promotion can be examined by decomposing the
sales bump during the sales promotion period into sales increase due to brand switching,purchase time
acceleration and stock piling. The author proposed a method for such decomposition whereby brand sales are
considered the result of consumer decision about when, what and how much to buy. The impact of marketing
variables on these three consumer decisions is captured by an Erlang-2 inter-purchase time model, a
multinomial logit model of brand choice and a cumulative logit model of purchase quantity. The models are
estimated with IRI scanner panel data for regular ground coffee. The result indicates that more than 80% of
the sales increase due to promotion comes fi-om brand switching. Purchase acceleration in time accounts for
less than 14% of the sales increase, where as stock piling due to promotion is a negligible phenomenon
accounting for less than 2% of the sales increase.
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CHAPTER - 3
Chapter 3
Company Profile
TVS was established by Mr TV Sundaram Iyengar. in the year 1978. He began with
Delhi first bus service in 1911 and founded T.V.Sundaram Iyengar and Sons Limited, a company in
the transportation business with a large fleet of trucks and buses under the name of Southern
Roadways Limited.When he died in 1955, his sons took the company ahead with several forays in
the automobile sector, including finance, insurance, manufacture of two-wheelers, tyres and
components. The group has managed to run 97 companies that account for a combined turnover of
nearly $6 billion.
TVS Motor Company is the third largest two-wheeler manufacturer in India, with a
revenue of over 13,000 Cr ($2 billion) in 2016-17. It is the flagship company of the Rs. 40,000 Cr
($6 billion, in 2014-15) TVS Group. The company has an annual sales of 3 million units and an
annual capacity of over 4 million vehicles. TVS Motor Company is also the 2nd largest exporter in
India with exports to over 60 Countries.TVS Motor Company Ltd (TVS Motor), member of the
TVS Group, is the largest company of the group in terms of size and turnover, with more than 3
crore (30 million) customers riding a TVS bike.
Suzuki relationship :
TVS and Suzuki shared a 19-year-long relationship that was aimed at technology
transfer, to enable design and manufacture of two-wheelers specifically for the Indian market. Re-
christened TVS-Suzuki, the company brought out several models such as the Suzuki Supra, Suzuki
Samurai, Suzuki Shogun and Suzuki Shoaling. In 2001, after separating ways with Suzuki, the
company was renamed TVS Motor, relinquishing its rights to use the Suzuki name. There was also
a 30-month moratorium period during which Suzuki promised not to enter the Indian market with
competing two-wheelers.
10
Recent :
Recent launches include RTR 200, TVS Victor and TVS XL 100. TVS has recently
won 4 top awards at J.D. Power Asia Pacific Awards 2016, 3 top awards at J.D. Power Asia Pacific
4Awards 2015 & Two-Wheeler Manufacturer of the Year at NDTV Car & Bike Awards (2014–15)
In early 2015, TVS Racing became the first Indian factory team to take part in the
Dakar Rally, which is the longest and most dangerous rally in the world. TVS Racing partnered
with French motorcycle manufacturer Sherco for the Dakar rally, and named the team Sherco TVS
Rally Factory Team . TVS Racing also won the Raid de Himalaya and the FOX Hill Super Cross
held at Sri Lanka. In three decades of its racing history, the team has won more than 90% of the
races.
In 2016 TVS started manufacturing the BMW G310R, a model co-developed with
BMW Motorrad.
TVS Motor was the first Indian company to deploy a catalytic converter in a 100 cc
motorcycle and the first to indigenously produce a four stroke 150cc motorcycle. The list of firsts
from TVS: "India’s first 2-seater moped – TVS 50", "India’s first indigenous scooterette - TVS
Scooty", "India’s first Digital Ignition - TVS Champ", "India’s first fully indigenous motorcycle -
Victor", "First Indian company to launch ABS in a motorcycle - Apache RTR Series", "The first
scooter with Body-Balance Technology – TVS Wego","The clutch less motorcycle=Jive",
"Indonesia’s first dual-tone exhaust noise technology – Tormax" & "India's first oil-cooled chamber
construct with Ram-Air assist- TVS Apache RTR 200 4V". TVS has gone through extensive quality
improvement programs thus producing world class two-wheelers.
Manufacturing Capability :
TVS Motor has a production capacity of over 3 million Vehicles a year. The company
has four state of the art manufacturing plants - three located in India (Hosur, Tamil Nadu; Mysore,
Karnataka and Nalagarh, Himachal Pradesh) and one in Indonesia (Karawang).
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Distribution :
Today, TVS Motor functions through a nationwide network of more than 4000 touch
points across all the states in India.
Awards :
TVS Motor won prestigious the Deming Application Prize in 2002.In the same year,
the work done for the TVS Victor motorcycle won TVS Motor the National Award for successful
commercialisation of indigenous technology from the Technology Development Board, Ministry of
Science & Technology, Government of India.In 2004, TVS Scotty Pep won the 'Outstanding Design
Excellence Award' from BusinessWorld magazine and the National Institute of Design, Ahmedabad.
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3.2. INDIAN MOTORS AGENCIES ( Authorised dealer for TVS MOTORS)
Finance Department :
Finance department performs various operations regarding financial transactions, and
it analyses the loss and profit and day to day transactions.
Marketing Department :
It is responsible for all the sales and marketing decisions of the company.
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CHAPTER - 4
Chapter - 4
Research Methodology
Research Design:
The present study selected the descriptive research design that is evaluating factors
to determine the sales promotion are well explained and found out the various relation ships.
Population :
Customers form Bangalore city.
Sample Frame :
Sample Size :
100 Units.
Sample Method :
I. Primary Source :
a. Questionnaire.
b. Structured Interview : The interview is presented with exactly the same questions in the
same order.
14
CHAPTER - 5
Chapter - 5
News papers 51 51
Hoardings 32 32
Road shows 10 10
Internet 7 7
Inference :
From the above table, among 100 customers of TVS bikes , 51% of the customers bought TVS
bike because after seeing the advertisement in newspaper which gives the major and clear
information about the bike, 32% of the customers mention hoardings of tvs bike makes them to
know about the bike, 10% of the customers bought TVS bike after seeing the stunts made with
the TVS bike makes them to buy the bike. 7% of the customers mention they seen some ads in
internet i.e Facebook, Youtube and collects some information about the bike by seeing the
previous user reviews.
1. Chart showing the what makes customers to buy the TVS bikes
No of Respondents
100
75
50
25
0
News Paper Hoardings Road shows Internet
15
2. Table showing customers opinion about the PRICE PACKS given by TVS
Satisfied 82 82
Un satisfied 18 18
Inference :
From the above table, among 100 customers of TVS bikes ,82% of the customers was satisfied
because of reduction in price of the products than its regular price and also they are getting two
products for one price and 18% of the customers mentioned unsatisfied because they are keeping
the offer for short period of time and also dealers are mentioning that the products are out of
stock.
2. Chart showing the customers opinion about the PRICE PACKS given by TVS
No of Customers
100
80
60
40
20
0
Satisfied Not Satisfied
16
3. Table showing customers opinion about the PROMOTIONAL GIFTS given by TVS
Satisfied 48 48
Un satisfied 52 52
Inference :
From the above table, among 100 customers of TVS bikes ,48% of the customers was satisfied
because for getting some free accessories when they purchase new bike with out any cost and 52%
of the customers mentioned unsatisfied because free accessories which they received while
purchasing the bike are poor in quality and they are keeping this offer more on bikes which are
high in cost.
3. Chart showing the customers opinion about the PROMOTIONAL GIFTS given by TVS
No of Customers
100
80
60
40
20
0
Satisfied Not Satisfied
17
4. Table showing customers opinion about the EXTENDED ASSURANCE given by TVS
Beneficial 96 96
Not Beneficial 4 4
Inference :
From the above table, among 100 customers of TVS bikes ,92% of the customers was satisfied
because they will use the bike for more than 3 years and it makes worry free ownership for upto 5
years and resale value of the of the bike is protected and 4% of the customers mentioned not
beneficial because they are not going to use the bike for longer period
4. Chart showing the customers opinion about the EXTENDED ASSURANCE given by TVS
No of Customers
100
80
60
40
20
0
Satisfied Not Satisfied
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5. Table showing does TVS promotional activities create interest in buying
Not Beneficial 0 0
Inference :
From the above table, among 100 customers of TVS bikes ,100% of the customers was satisfied
because interest was low and repayment option as form 12 to 48, customers told that it was very
beneficial mainly for the employees.
No of Customers
100
80
60
40
20
0
Satisfied Not Satisfied
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6. Table showing promotion through which social networking will beneficial
Facebook 61 61
Youtube 38 38
Twitter 1 1
Inference :
From the above table, among 100 customers of TVS bikes ,61% of the customers told that
promotion thorough Facebook will be more beneficial because maximum number of people are
using facebook now a days, 38% of the customers prefer promotion through youtube because
video can gives the clear message about the brand and 1% prefer twitter
No of Customers
100
80
60
40
20
0
Facebook Youtube Twitter
20
7. Table showing does promotional activities done by TVS are different form other brands
Yes 11 11
No 89 89
Inference :
From the above table among 100 tvs customers, 89% of the customer mention that promotional
activities done by TVS are new and innovative because easy finance, offers, discounts are given by
other brands also, so the customers mentioned it was not innovative. 11% of the customers mentioned
yes because these customers are using TVS from so many years back so they are not aware of other
brands.
7. Chart showing the does the purchase decision affected by brand name
No of Customers
100
80
60
40
20
0
Yes No
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8. Table showing does customers recommend TVS to others
Yes 78 78
No 22 22
Inference :
From the above table among 100 tvs customers, 22% of the customers mention that they will
recommend TVS bikes to others because of low maintainance cost with proper service quality and
22% of the customers mention that they will not recommend the bikes for others because there is no
improvement in technology of a bike when compared with other brands
No of Respondents
100
80
60
40
20
0
Yes No
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9. Table showing does these promotional activities affects customers buying behaviour
Yes 67 67
No 33 33
Inference :
From the above table among 100 tvs customers, 67% of the customers mention that these promotional
activities can make customers to buy because Extended assurance, Road side assistance service will be
more beneficial and more attractive and 33% of the customers mention that these promotional
activities does not affect any consumer buying behaviour
9. Table showing does these promotional activities affects customers buying behaviour
No of Respondents
100
80
60
40
20
0
Yes No
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5.2. FINDINGS
These are the findings which i found during the research study in TVS Motors sales and service
centre, bellandur, Bangalore.
1. From the research i found majority of the customers bought the bike after seeing advertisement
in newspapers.
2. Some customers told that price packs organised by the company for short period and offering
only on high price vehicles.
3. Majority of the customers told that free gifts which are offering by the company are not good
quality so, they are not satisfied with that offer.
4. From the research study i found Extended assurance was beneficial for majority of the
customers and they were satisfied.
5. Majority of the customers told that promotional activities of TVS are not innovative and new.
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5.3. SUGGESTIONS
These are some of the suggestions which i recommend to TVS motors , Bellandur, Bangalore.
1. I recommend TVS motors to give promotional gifts for all the bikes not for only selected bikes.
3. Promotion through Facebook will be more beneficial for the comapany to target mainly
students.
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CHAPTER - 6
Chapter - 6
CONCLUSION
1. Indian Motors Agencies which is authorised seller of TVS motors is an only TVS bike
showroom in bellandur, Bangalore.
2. It is offering very good service for the customers and also maintaining a best customer relation
with all the existing customers to satisfy all the customers.
3. Indian Motors Agencies has very good marketing strategies to improve the sales.
4. TVS two wheelers is a well known two wheeler manufacturing companies in India.
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ANNEXURE
ANNEXURE
2. Are you satisfied with the PRICE PACK offers given by TVS
A. Satisfied B. Un Satisfied
A. Satisfied B. Un Satisfied
A. Yes B. No
7. Do you think promotional activities done by TVS are different from other brands
A. Yes B. No
A. Yes B. No
A. Yes B. No
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BIBLIOGRAPHY
BIBLIOGRAPHY
BOOKS :
• Kotler Philip, Keller Lane Kvin "Marketing Management" 12th edition Pearson Education.
Publications
WEBSITES :
www.google.com
www.wiki.com
www.yahoo.com
www.tvsmotors.com
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