MARKETING MANAGEMENT

TERM PROJECT

TOPIC: MARKETING ANALYSIS ON „YAMAHA‟

Submitted By:
Hamid Ateeq 26920
Khalil Ur Rehman Alvi 26932
Maha Imtiaz 27028
Munawar Hassan 26769
Ramsha Ashfaq 26794
Shaheer Nadeem 27002

Submitted To: Prof. Dr. NAUMAN TIRMIZI

Submission Date: 21st April 2020

 TABLE OF CONTENT

ACKNOWLEDGEMENT------------------------------------------------------------------------------ 3

EXECUTIVE SUMMARY------------------------------------------------------------------------------ 4

1: INTRODUCTION--------------------------------------------------------------------------------------- 5-7

1.1: Corporate Brief History---------------------------------------------------------------------------- 5-6

1.2: Owners (Share Holders) Profile------------------------------------------------------------------- 6

1.3: Organizational Structure (Hierarchy) ------------------------------------------------------------- 6-7

2: SITUATION ANALYSIS (Findings) ------------------------------------------------------------------- 7-32

2.1: Corporate Strategies-------------------------------------------------------------------------------- 7-8

2.2: Brand’s Market Share-------------------------------------------------------------------------------- 9

2.3: Competitor’s Analysis--------------------------------------------------------------------------- 10-11

2.4: Marketing Department Strategies-------------------------------------------------------------- 11-15

2.5: Marketing Department Structure--------------------------------------------------------------- 15-16

2.6: Value Creation------------------------------------------------------------------------------------ 16-20

2.7: Touch Points-------------------------------------------------------------------------------------- 20-21

2.8: Product Development------------------------------------------------------------------------------ 22

2.9: Brand-Driven Innovation -------------------------------------------------------------------------- 22

2.10: Pricing Strategy--------------------------------------------------------------------------------- 23-26

2.11: Consumer Profile------------------------------------------------------------------------------- 26-27

2.12: Channel Management-------------------------------------------------------------------------- 28-29

2.13: Financial Profile-------------------------------------------------------------------------------- 30-31

2.14: SWOT Analysis--------------------------------------------------------------------------------- 31-32

3: Problem Definition----------------------------------------------------------------------------------- 32-33

4: Alternatives-------------------------------------------------------------------------------------------- 33-34

5: Recommendations------------------------------------------------------------------------------------ 34-35

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 ACKNOWLEDGEMENT

First of all, We would like to say thanks to The Almighty Allah for giving us the opportunity to work on
“YAMAHA”. The success of any project depends largely on the encouragement and guidelines of many
others. I take this opportunity to express my gratitude to the people who have been instrumental in the
successful completion of this report.

We wish to express our gratitude to the staff member of Yamaha who rendered their help during the
period of survey.

We would also like to thank our teacher Prof. Dr. Nauman Tirmizi for motivating and being such a
great mentor. All these people really gave us a lot of support and all the information that we required,
was willingly provided by them. Without their encouragement and guidance this project would not have
been materialized.

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 EXECUTIVE SUMMARY

It summarizes all our work which we did during our report on “YAMAHA”. We worked under the
supervision of Prof. Dr. Nauman Tirmizi.

During this report we learned about the marketing analysis and strategies used by Yamaha to attract
their customer and to remain in market. We also had an amazing experience in gathering data which
boost our knowledge and give us know how about the market and about the competitors.

4
1: INTRODUCTION:

Yamaha was initially into manufacturing music system especially piano before WWII, after second world war, they
took advantage of the opportunity & utilized their resources to diversified into other business. Yamaha started its
motorcycle business from Japan & then expanded globally!

1.1: CORPORATE BRIEF HISTORY:

Yamaha first came to Pakistan in the 1970s via a joint venture with the Dawood Group (known as DYL) and for
decades remained the second largest player in the motorbike segment, trailing just behind Honda. However, by the
year 2000, DYL’s market share started declining sharply, partially due to the introduction of low cost and
comparatively advanced Chinese bikes and partially because of lack of innovation in DYL’s own products.

However, entering the Pakistani market proved to be a major challenge for Yamaha, largely due to the hefty import
duties imposed on completely built up (CBU) motorbikes and on parts by the government.

Ito elaborates: ―We had to import all the parts, which meant we had to pay a 40% import duty on each and every
part of their bikes. With such a duty structure, it was not possible to compete in terms of prices, so in 2008 we
started negotiating for new-entrant benefits with the government and made their case on the basis that we would
invest in local training, introduce advanced technologies and safety standards and add to Pakistan’s exports in terms
of bikes. Finally, the current cabinet approved their appeal on the condition that we started with 15% localization and
a commitment to add another 15% every year.‖

Yamaha Motor Pakistan (abbreviated as YMPK) is a 100% subsidiary of Yamaha Motor Co., Ltd. YMPK is the sole
manufacturer and distributor of Yamaha Brand Motorcycles in Pakistan, established in Mar 2013.

The company is registered with the Ministry of Commerce for assembling, manufacturing, marketing, distributing,
selling and/or servicing Yamaha Motor Pakistan (Pvt) Ltd brand motorcycles and their parts and accessories in
Pakistan.

Yamaha Motor Pakistan introduced its first phase of Model line-up, YBR125 model, which has been made available
all-around Pakistan with a strong Sales Network of 140 dealerships from 28th April for all bike lovers and commuters.

CORPORATE MISSION:

“Offering new excitement and a more fulfilling life for people all over the world”

Yamaha Motor strives to realize peoples' dreams with ingenuity and passion, and to always be a company people
look to for the next exciting product or concept that provides exceptional value and deep satisfaction.

1.2: OWNERS (Share Holders) PROFILE:

Nippon Gakki Co. Ltd. Founded in 1897 which is today’s YAMAHA Corporation.
Founder and First President: Torakusu Yamaha
First Name: Torakusu
Family Name: Yamaha

YAMAHA Motor Co., Ltd. Founded in 1955

Founder and First President: Genichi Kawakami
Fourth President of Nippon Gakki Co., Ltd.

5
1.3: ORGANIZATIONAL STRUCTURE:

ORGANIZATION:

A social unit of people, systematically structured and managed to meet a need or to pursue collective goals on
continuing basis.

ORGANIZATIONAL STRUCTURE:

An organizational structure is a system that outlines how certain activities are directed in order to achieve the goals
of an organization. These activities can include rules, roles, and responsibilities.

The organizational structure also determines how information flows between levels within the company. For example,
in a centralized structure, decisions flow from the top down, while in a decentralized structure, decision-making
power is distributed among various levels of the organization.

YAMAHA Motors Pakistan has decentralized organizational structure.

ORGANIZATION HIERARCHY:

YAMAHA MOTORS PAKISTAN

Director Finance Managing Director Sales and Marketing Director

KATO HIROKI ISHIKAWA SHEIGRU Manufacturing
HOSHINO TOSHIAKI
Costing Marketing Sales

Product
Accounts Product Public
Advertising Activation Planning
Planning Relation
and
Control
HR Strategy Research Digital
Social Customer YBR/YBR
Networking Relationship G/YBRG Supply
Admin Communication, Management Chain
Website
Designing
Free Quality
Customer Service Control
Logistics Ecommerce Care Camp
Quality
Shipping Assurance
Yamaha Free oil
Rider Club change
New
Products and
Sales Part
Force Development

Manufacturing

6
2: SITUATIONAL ANALYSIS:

2.1: CORPORATE STRATEGIES:

A corporate strategy entails a clearly defined, long-term vision that organizations set, seeking to create corporate
value and motivate the workforce to implement the proper actions to achieve customer satisfaction. In addition,
corporate strategy is a continuous process that requires a constant effort to engage investors in trusting the
company with their money, thereby increasing the company’s equity. Organizations that manage to deliver customer
value unfailingly are those that revisit their corporate strategy regularly to improve areas that may not deliver the
aimed results.

Corporate strategies may pertain to different aspects of a firm, yet the strategies that most organizations use are
cost leadership and product differentiation.

YAMAHA Motors Pakistan focus on

The Spirit of Challenge inherited from Nippon Gakki is at the core of their Corporate activities.

Offering new excitement and more fulfilling life for people all over the world.

YAMAHA strives to realize people’s dream with ingenuity and passion and to always be company people look to for
the next exciting products or concept that provides exceptional values and deep satisfaction.

CORE COMPETENCIES:

 Small engine technology

 FRP (Fiber Reinforced Plastics) technology
 Electronic control technology

PRODUCTS & BUSINESS OPERATIONS:

By utilizing these three core competencies throughout their over 50 year history, Yamaha Motor products and
business operations have grown and expanded into a variety of areas. One particularly noteworthy point is that all of
these product operations were launched within Yamaha Motor and not via other corporations or business
acquisitions.

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GLOBAL MANUFACTURING SYSTEM:

Yamaha basic policy is to develop, manufacture and market products in the regions and markets where they will be
used. To achieve this goal, we have manufacturing bases in areas all over the world.

2.2: BRAND‟S MARKET SHARE:

Market overview based on Brands:

Market overview based on Models:

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As of 2012, Yamaha Motor products are sold in over 200 different countries and territories.

2.3: COMPETITOR‟S ANALYSIS:

Yamaha Motor Company has always been the leading manufacturer and distributor of motorcycles worldwide with a
growing number of outlets and branches in every country. Recognized as an established brand worldwide, Yamaha
motors has a huge history behind it. Let’s dig into that history!

Yamaha Motor Company was founded in the year 1955. The same year marked the development of Yamaha’s vert
first motorcycle, which was the YA-1.

Being a newborn company, against all odds, Yamaha proved its competitor’s wrong straight from the get-go. The YA-
1 went ahead to win 125cc in The Mount Fuji Ascent race right after it was manufactured. Even though the
motorcycle along with the company were new, Yamaha showed authenticity.

In Pakistan all competitors are producing locally and just a reduced number of manufacturers are fighting in the
market, with local brands (DYL, Sohrab, United Auto, Sazgar, Road Prince, Hero Motor (a Pakistan
company) Ravi) and Japanese companies are Honda, Suzuki and YAMAHA

Market leader is Honda with over 55% of market share, YAMAHA with over 7% and Suzuki with 5% of market
share.

MARKET SHARE
56%
60%

40%

20%
7% 6%
0%
Yamaha Suzuki Honda

9
 PRODUCTION CAPACITY PRODUCT PRICE
PER ANUM 300000 219500
164000 182000
2000000 1350000 200000
100000 0 0 0
1000000
40000 44000 0
0 Yamaha Suzuki GS150 Honda
Yamaha Suzuki Honda YBR/YBRG CBF150

2.4: MARKETING DEPATEMENT STRATEGIES:

As the product is innovative & new to the Pakistan Motorcycles Market; To let customer touch, feel & experience
motorcycle, so that, not only they get impress with its look and style, also with its riding experience. And also, to
create top of mind recall.

Firstly, YMP creates ACCESS available for it customer:

With the combine support of dealers & YMP, make available YBR125 for test ride activity in the motorcycle market on
the specified test course So that they can:

SEE IT! FEEL IT! RIDE IT

CULTIVATING STRATEGY:

For over 50 years, Yamaha Motor group has endeavored to create diverse value through products and services for its
customer since its founding.

Yamaha worked based on three ideas which constitute their ―Corporate Marketing Philosophy‖. One is their
―Corporate Mission‖, that is Yamaha core identity, values for its customer, purpose and visionary goals. The second is
―Management Principles‖ - the guiding management principles for achieving their corporate mission. The third is
―Action Guidelines‖, the guidelines each individual should follow to realize their corporate mission.

Being the ―Kando* creating company‖ is their goal to ―offer new excitement and a more fulfilling life for people all
over the world‖. They strive to use their ingenuity and passion to realize peoples' dreams and always be the ones
they look up to for ―the next Kando*.‖

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As the Company's tradition and pride to fuse technology with sensitivity is the very foundation in providing
"Kando" to their customers.

Yamaha observed that people’s values will become increasingly diverse and moves towards modernization
throughout the world, and issues surrounding the global environment and society will become more serious and
complicated. Here, Yamaha Motor applies its cultivated technology and sensibility to ―Human-like‖ and ―Expanding
human possibilities‖. In this way Yamaha believe that they can respond to the needs of society.

Survey Shows that following are the need of Pakistani Bike Market before Yamaha:

1. Innovative Style.
2. Comfort Ride.
3. Safety First.
4. Self Stater.
5. Bikes for Long Journey.
6. Aerodynamic Shape.
7. Economical.
8. Fuel Average.
9. Engine Balancing
10. . . . and more.

Yamaha tied the knot of following Cultivating Strategies:

Know That Happy Customers = Returning Customers:

Making (and keeping) customers happy has benefits that stretch beyond simply having satisfied patrons. Happy
customers are more likely to refer your service, product or business to their friends, family and colleagues.

Yamaha following to all track to make their customer happy and satisfied so sometime providing gifts or parties to
their customer. In turn, a great Customer relationship strategy builds brand loyalty and improves business'
reputation. Satisfied customers, who feel as if their needs are being met— or ideally, exceeded — are more likely to
speak positively of business, rate it high in front of others.

Set and Manage Realistic Expectations:

One of the most important factors that goes into an effective CRM strategy is providing customers and clients with
realistic expectations — and following through with them, Yamaha first provide and innovative style and sense to
their customer as they believe that customer should not expect more than promise.

YMP first analyses the customer mind and then create the imagination of their innovative product.

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Be a Connector:

One of the best thing for Yamaha is Digital Marketing that’s includes Website, Email marketing, Social Media
Marketing, Advertisement Blogs & Riders club. Yamaha has opened new ways of communication where customer can
directly connect with ads in digital space not only for getting product knowledge, also for complaining and share their
valuable feedback.

Keep Documentation:

Downey also suggests keeping track of important customer details (names, birthdays, kids' names and other relevant
information), as well as sending cards or personal notes to customers at least once every year.

Respond Promptly:

Yamaha believes that quick responses can leave a lasting

impact on customers. Prompt responses to customer inquiries,
feedback or comments can be the difference between a simple
client relationship and a great one.

Customer Perspective Training:

Customer Perspective Training is Yamaha’s unique system of training wherein employees learn about decision-
making standards and values outside of their own perspective in order to develop the habit of considering the
perspective of customers in their actions. This training is gradually being extended to more divisions. It is currently
held every month in many divisions, such those related to Quality, production and marketing

Recommendation for Improvement:

Yamaha listening to customer opinions and considering customer expectations, points of improvement for Yamaha in
order to research and development, and actions that should be taken.

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2.5: MARKETING DEPARTMENT‟S STRUCTURE:

CUSTOMER FOCUSED DEPARTMENT- CUSTOMER SERVICES

YMP CUSTOMER FOCUS DEPT FLOW CHART

Finance Marketing & Aftersale Manufacturing

Marketing After Sales PPMC

Customer Care

Research Supply
Chain

Costing Development
Quality
Control

YMP CUSTOMER FOCUS DEPARTMENT INTERACTION:

YMP is an organized company which deals all kind of CSR and Customer Relationship Management, above chart
shows that how YMPL deal with their loyal customer for their valuable feedback.

As complain / feedback generated from aftersales and sales team survey, these all feedback inquired to Marketing
Dept. where evaluation is based on current market requirement. After proper research and Evaluation Marketing
Dept. requests to implement improvement and modification to Development Dept. along with Finance Dept. for value
addition. Development Dept. completes their activity and ensures it from Quality Depart and instructs it Supply chain
for resourcing and final implementation in New Production. This is how circle is continued for further queries and
feedbacks.

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2.6: HOW DOES COMPANY CREATES VALUE FOR ITS CUSTOMERS?

YAMAHA VALUE CREATION:

Yamaha Believes That:

“It costs ten times more to acquire a new customer than service an existing one”.

YAMAHA‟s ATTEMPT TO ATTRACT CUSTOMER:

APPROACH TO QUALITY:

Yamaha Motor is working daily to improve quality and to provide customers with peace of mind and confidence as
well as a sense of excitement.

YMPL formulated the YQ2021 Company wide medium-term quality policy covering the years 2019-2021, which sets
three specific goals for their business activities: quality that provides exceptional excitement; quality that challenges;
and quality that is trusted.

In addition, the Yamaha Group's Quality Assurance Standards conforming to ISO9001 form the basis for continuous
improvement to quality management systems.

QUALITY ENHANCEMENT & IMPROVEMENT ACTIVITIES:

To ensure that employees have ingrained, quality-related knowledge and skills, training for quality is annually held
for new hires, for employees related to manufacturing two to five years after being hired. In addition, education and
training programs are annually in place to enhance the skills of employees to ensure they are technologically
proficient
With those programs as a base, all employees undertake the ―I am Yamaha‖ activities for enhancing quality during
their actual work. These activities encourage a strong sense of ownership in every employee, so that each individual
believes, ―It is I, and no one else, who is personally responsible for making the Yamaha brand shine.‖ This attitude,
along with a customer-oriented approach, allows employees to refine their powers of perception

To enhance the quality work, for both as an organization and as individuals, Yamaha strives on following
benchmarks:

 Enhance their customer sense.

 Increase interaction.
 Learn from mistakes.
 Do high-quality work.

YAMAHA AFTERSALES SERVICES:

The Yamaha Motor Group views after sales service as an important aspect of quality, and that principle is laid out in
their Basic Policies for Quality as ―To constantly provide peace of mind, confidence and a sense of excitement to
customers, we strive to achieve the best quality possible, by creating suitable standards of safety and reliability to
realize high-quality products and services effectively. Yamaha introduced the slogan ―One to One Service‖ for the
active creation of positive relationships with each individual customer. Accordingly, Company operates the Yamaha
Riding Club to train customer which creates more value as compare to others.

In addition, the Yamaha Parts & Accessories Academy is a similar training program covering the parts and
accessories that are essential for after sales service and ensure it to provide best services for their customer on time.

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RESPONDING TO CUSTOMERS:

They want customers to use their products with peace of mind for a long time. This makes a stable supply of parts
indispensable. To prevent shortages for motorcycles, we maintain a minimum of a 10-year supply of parts, and have
built a system where customers can order parts online and have them delivered quickly. For customer convenience,
we also keep a parts list published on the website, so that customers can use a personal computer or smartphone to
identify the parts they need and order them from dealers.

TIME IS MONEY:

Yamaha service strictly follows also include a ―time commitment service,‖ mainly in the Pakistan region where many
people use motorcycles as a means of daily transportation. For example, YMPL tell the customer, ―A regular
inspection will take this long,‖ or ―An oil change will take this long,‖ committing to the amount of time the customer
has given us and not causing stress for the customer by saying, ―We don’t know when it will be finished.‖

USE OF CUSTOMER INFORMATION:

The YMPL views opinions and requests from customers as expressions of their expectations for their products and
services, so YMPL carefully respond to each opinion and request they receive, in the belief that raising the level of
customer satisfaction will lead to trust. Based on this spirit, they undertake various activities to know how customers
evaluate and use their products, and to learn how to improve their products and what kinds of products to make in
the future. YMPL actively run their digital media for safety awareness and periodically maintenance for their bikes to
save their life for unpredictable experiences that absolutely support their customer and value it.

RIDING SAFETY PROMOTION ACTIVITIES:

Customer safety is Yamaha’s first priority, and in addition to enhancing product quality, we continue to put their
maximum effort into activities which explain to customers in an appropriate manner how to use their products
correctly.

These efforts include the publication of catalogs and brochures that convey the attractiveness of their products and
product manuals that explain correct product use, as well as safety promotion activities such as riding schools that
allow customers to gain first-hand knowledge about using their products.

HOW YMPL CUSTOEMER EVALUATE THEM SELVES BEFORE AND AFTER PURCHASING YAMAHA BIKE:

Before Yamaha After Yamaha

Style/Design Vibration
Riding Comfort Fuel Consumption
Brand Quality
High Max-Speed EG performance
Good Acceleration Dealer Service Skill
Engine Performance Riding Comfort
Body Size Body Size
Resale Value Color/Graphic
Mainly …....
Parts Availability Retail Price
Quality Parts Availability

0 5 10 15 0 5 10 15
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Pakistan Market Customer YMPL Satisfied Customer
1. Vibration 1. Style/Design
2. Mileage Problem 2. Fast Performance.
3. Quality issues. 3. Riding comfort.
4. No Sense of Style 4. High Quality

Yamaha not only satisfied customer but also change in mindset for a bike purchaser.

YAMAHA MOTOR PAKISTAN – AS CORPORATE SERVICE RESPONSIBILITY:

With an awareness of "contributing to society through business", we identify important issues that the Company
should be helping with

1. Environmental & resources issues

- Reducing the CO2 emitted from manufactured products by 50% by 2050
- Safer water supply
2. Transportation, education &·industrial issues
- Promotion of the fishing industry in developing countries
- Offering last-mile mobility solutions
3. Innovation issues
- Proposing new styles of mobility
- Accelerating innovation through collaboration
4. Work method issues
- Safe and more secure work environments
- Diversity and inclusiveness

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2.7: HOW HAS THE COMPANY EVOLVED THE MANAGEMENT OF ITS CUSTOMER TOUCH
POINTS?

CUSTOMER TOUCH POINTS:

Yamaha believes touchpoint is any time a potential customer or customer comes in contact with your brand–before,
during, or after they purchase something from you.

As Yamaha Motor Pakistan know that Identifying touchpoints is the first step toward creating a customer journey
map, and making sure your customers are satisfied every step of the way.

Yamaha create 04 substantial ways to create its customer touch point.

Socially Interaction:

 YAMAHA GRAPHIC DESIGN CONTEST: With these concepts in mind, think about ways you can improve
customer value to grow your business.
 Yamaha rider club
 Yamaha Financial Services For installment Program
 Yamaha Dealers
 Yamaha Community Club Facebook, twitter , Insta through marketing ,Yamaha Websites

Attraction For Marketers:

 YBR125G Sports to convert YB 125Z

 Staff / Sales Team (focus on Young and attractive team)
 Yamaha Posted every seasoning videos and instruct their customer
 Commencement of Marketing PR
 Attraction For Bikes Rider
 After Sales Services

Customer Care as Mother Care:

 Extra gift from Yamaha

 Online feedback to customer for complaint
 Transactional Emails and messages
 Magazine /catalog / Videos
 Word Of Mouth
 Promotions
 24/7 Online Help center
 Winter warm occasions instruction , safety gloves helmet instruction, comfort instruction
 Mother Feeling because of so much safety and care

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Innovative Touch:

 Mountain Day for Bikers to promote YBR125G

 Rider of Month
 Yamaha Promotion schemes for youngster
 Yamaha Promotion Stall for Families
 Yamaha Promotion Sales Team Visit for Offices in lunch Break
 Special Day celebration ( Focus on Lover and ride ) Kyun kay dil nay Kaha Yamaha
 Attractive Slogan like( No road is too long when You have got good company )

2.8. COMPANY‟S STRATEGY FOR PRODUCT DEVELOPMENT AND USE OF RESEARCH AND
FEEDBACK MECHANISMS:

PRODUCT DEVELOPMENT:

Product development may involve modification of an existing product or its presentation, or formulation of an entirely
new product that satisfies a newly defined customer want or market niche.

Yamaha Product development strategy can be described as a five-stage process, beginning with generating ideas and
progressing to marketing complete products. In between are processes where they evaluate and screen product
ideas, take steps to protect their ideas, and finalize design in an R&D stage.

Yamaha Motor Pakistan (PVT) first introduced YBR 125 for on road then they modify it and come up with YBR 125G
for off road. Later they launched its third variant YBR 125Z to satisfy its customers. However Yamaha’s Product
development has few problems like huge gap in introducing new features from previous whereas as their competitors
are offering more unique and state of the art designs in there motorcycles like Benelli, Kawasaki etc.

CUSTOMER FEEDBACK AND INFORMATION:

The Yamaha Motor Pakistan (PVT) views opinions and requests from customers as expressions of their expectations
for their products and services, so they carefully respond to each opinion and request they receive, in the belief that
raising the level of customer satisfaction will lead to trust. Based on this spirit, they undertake various activities to
know how customers evaluate and use their products, and to learn how to improve their products and what kinds of
products to make in the future.

For example, they send an Internet survey to customers who have purchased a new product, and in some cases,
they may ask the customer in person for a more detailed evaluation.

Comments received from customers are stored in a database, and are made available within the Company so that
they can be used to develop and improve their products and enhance their services.

Yamaha owns its customers and appreciate their feedback. To improve their product they do research and try to
modify it. They recognize the problem of customers that the sporty bikes are not feasible for family in terms of its
seat. Therefore, they come up with YBR 125Z specially design for family.

2.9. DOES THE COMPANY HAVE A STRATEGY ON BRAND-DRIVEN INNOVATION FOR

LEVERAGING BRAND EQUITY TO GROW AND DIVERSIFY THE BUSINESS?

Yamaha currently working only on a 125cc category bikes they have no near future plan of introducing a 150CC bike,
so currently Yamaha not diversifying their business in Pakistan nor they have any strategy on brand-driven
innovation.

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2.10. COMPANY‟S STRATEGY ON PRICING:

Yamaha uses the cost-plus pricing and value-based pricing strategy. In cost-plus pricing strategy they calculate their
cost of the product and add markup. And in value-based pricing strategy they set price on the bases of value they
are offering to their customers.

UNIQUE SELLING POINT (USP) OF YAMAHA:

Yamaha is giving value to its customers through offering 5 USP’s:

1. Head Light HS1: Yamaha Provide Halogen Light Which Help Riders to ride even in a fog environment.
2. Starter System: Yamaha gives Self-start system which provides ease to riders.
3. Style: Yamaha offers a unique and stylish body as well as strength and rigidity.
4. Engine Balancer: The purpose of Engine Balancer is to reduce to engine Vibration for better and smooth
rides.
5. Front Break: Yamaha gives Disc Breaks in front breaking system to provide high safety.

PRICE COMPARISION

YAMAHA vs HONDA
MODEL HONDA YAMAHA DIFFERENCE

125 CC SPECIAL EDITION 151,900 172,000 20,100

125 CC ECONOMICAL 126,500 146,000 19,500

The above table illustrates the price comparison of Yamaha vs Honda of 125 CC special edition and 125 CC
economical. It shows that the price of 125 CC special edition of Yamaha is of 172,000 while Honda offer 151,900 for
it which means that Yamaha offers more price than Honda for 125 CC special edition. The price of 125 CC
economical, Yamaha offers 146,000 while Honda offers 126,500. In 125 CC economical also Yamaha price are higher
than Honda.

BUDGET OVERVIEW
125 CC SPECIAL…

200,000

150,000

100,000

50,000

0
HONDA YAMAHA

The above graph illustrates that the Yamaha offers more prices than Honda for 125 CC special edition.

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 BRAND MODEL PRICE
Yamaha YBR 125Z 146,00
Super Power SP 125 75,000
United UD 125 75,500

The above table illustrates Yamaha YBR 125Z have strong competition with Super Power SP 125 and United UD 125
as they are offering 125cc bikes in much lower prices than Yamaha.

Yamaha may face problem as their bikes are of almost double price of its competitors therefore by introducing more
economical bikes in product range help Yamaha to overcome this problem.

2.10.1: Do they have a portfolio of brands wherein Company could work at different price
points to consolidate market share.

BRAND PORTFOLIO:

YAMAHA YBR 125: Price PKR 164,000

Yamaha YBR 125 is a sports bike in Pakistan with a splendid performance, sporty shape and a first-class impression.
Its features are self-start, Alloy rims, alluring speedometer with fuel gauge indicator and an ultra-bright headlight.
Yamaha YBR 125 possesses a highly comfortable rider and passenger seat. A 13L fuel tank coupled with surprisingly
great fuel economy makes you go miles without worrying about refilling fuel cost. It is specially design for on road.

YAMAHA YBR 125G: Price PKR 172,000

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Yamaha YBR 125G is brilliantly structured keeping in the record the genuine taste of enthusiastic bikers. Yamaha
YBR 125G has a general look of a trail bike. It has a similar engine as of Yamaha YBR 125. The appealing
speedometer has an rpm and fuel marker. Essentially wide and comfortable seat of Yamaha YBR 125G guarantee
great spine support on long rides. Alloy Rims Tyres, self-start system and lively body shape with dynamic designs and
specially for off road.

YAMAHA YBR 125Z: Price PKR 146,000

Yamaha YB125Z has stunning features, beginning from their more extensive seat which is structured particularly for
pillion riding, and to avoid a lot of vibrations, there is an engine balancer. It has better halogen headlights. Yamaha
YB125Z has the 4-stroke air cooled with single cylinder and an Electric start option (Kick-start is also an alternative).
It's incorporated with Wet-Type Multi-Plate Clutch system with the Backbone frame, making it a stronger bike.

2.10.2: Does the Company use Pricing Strategy to break into a bigger market segment?

No, Yamaha doesn’t use the pricing strategy to break into a bigger market segment because currently Yamaha is not
capturing the bigger market segment. Presently, Yamaha is just acquiring the market segment that they are
targeting and cultivating its customers.

2.10.3: Are they using Pricing as a Strategy to build a brand image?

No, they aren’t using pricing as a strategy to build a brand image. Yamaha builds its brand image through the value
they are giving to its customers by offering safety and comfort to them.

2.11. KEY CHARACTERISTICS OF COMPANY‟S CONSUMER PROFILE:

Yamaha targets the middle upper class and middle lower class males who are looking for safety and comfort along
with the style and a good mileage. The main target of Yamaha are the Youth of Pakistan which comes under the age
bracket of 18 to 35. The main idea of targeting the youth is that during this 18 to 35 age they are conscious about
the style, are sporty and they love thrill and all of this is what Yamaha is offering. Therefore, Yamaha is youth-
centric.

Characteristics of a consumer can be divided into a two category.

 Demographic
 Psychographic

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2.11.1 DEMOGRAPHIC:

 Urbanization:

Pakistan has the highest rate of urbanization in South Asia. Yamaha grab the opportunity and target the growing
middle class and middle-upper class of Pakistan. People who earned around Rs16,000 preferred 70cc bikes while
those who earned a salary of Rs35,000-40,000 usually bought bikes having the engine capacity of 100cc to 150cc
Yamaha Target the People who earned above 35,000 Pkr.

URBANIZATION IN PAKISTAN 2020-2016

78,000,000
76,000,000 77,437,729
74,000,000 75,510,639
72,000,000 73,630,430
70,000,000 71,795,700
68,000,000 70,005,271

66,000,000
Urban Population

2020 2019 2018 2017 2016

 Age:

Age Group Male Female Total Percentage

0–14 32,130,198 30,220,789 62,350,987 41,61

15–64 41,951,884 40,618,318 82,570,202 55,10

65+ 2,775,655 2,163,544 4,939,199 3,30

Yamaha targets the youth and young population of Pakistan. Pakistan is male dominant Market. Yamaha targets all
young riders who are strong and active individuals and know what they want. And to celebrate its connection with
Pakistan’s young blood, Yamaha has launched a new campaign to pay homage to its loyal fans. Our youth is full of
talent and knows what they want. They are focused and single-minded with energy and passion inside. And that is
why Yamaha has chosen a young, driven and successful individual like Ali Zafar to represent their bikes.

2.11.2. PSYCHOGRAPHIC:

 Personality: Adventurous
Yamaha targets the youngsters with rough and tough personality,
Cautious
who Enjoy the thrill.

Top 5 Personality Traits of Yamaha Customer: Fearlessness

Resilient

Thrill-Seeker

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2.12. Channel Management - Does the company have the strategy of moving from
Traditional Channels to Digital or working with a blend of two?

CHANNEL MANAGEMENT:

Channel management is a technique for selecting the most efficient channels or routes to market for your products
and services, and deriving the best results from those channels by applying appropriate financial, marketing or
training resources.

Traditional marketing is one way to market your product effectively.

Yamaha is broadcasting or sharing information to their target audience about its product or service by TVC,
Billboards & Magazines.

Here is one thing that Yamaha lack in advertising is developing an emotional attachment with the customers as other
brands do, this problem and its solution is discussed below in this report.

Different Traditional Marketing Yamaha Traditional Marketing

Channel

Yamaha Digital Marketing includes Website, Email marketing, Social Media Marketing, Blogs & Riders club.

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Technology has opened new channels of communication where Audience can directly interact with ads in digital
space.

YAMAHA RIDERS CLUB- WE LIVE YOUNG & WE RIDE FREE!

In recognizing and fueling the passionate riding spirit that Yamaha bikers have for setting out on greater roads and
flaunting their style, Yamaha Motor Pakistan launched the exciting and exclusive Yamaha Riders Club.

The Yamaha Riders Club serves as an exclusive community of enthusiastic Yamaha bikers from all across Pakistan,
who connect with each other and share their favorite Yamaha memories and exquisite biking experiences on the road
– allowing them to represent their riding spirit on a much greater scale.

BLOGS:

As Blogging helps business owners to engage with customers & connects similar thinkers and communities of people
worldwide. Yamaha Blog platform is so active nowadays where people share personal views which helps & attracts
new customer who are interested.

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 2.13. FINANCIAL PROFILE OF THE COMPANY:
Motor Cycle Net sales declined ¥23.0 billion, or 2.2%, year on year, to ¥1,022.2 billion, and operating income
declined ¥14.3 billion, or 20.8%, year on year, to ¥54.5 billion.

Figure 1 shows that Yamaha’s 61.1% of the total Sales comes from the Motorcycle. This indicates that the
motorcycles are their highest selling business unit.

Figure 2 & 3 shows that 4,576,000 motorcycles were sold in Asia in the year 2018, generating ¥668 Billion.

Figure 1: Percentage of Sales by Product

Segment Figure 2: Motorcycle unit Sales by
Market Figure 3: Motorcycle Sales by
Market
Their overall Gross Profit Margin is approximately 27%.

Figure 4, Operating Income Margin was 8.4% in 2018. And estimated to fall further in 2019 to 8%. This indicates
that Yamaha’s Operating Expenses are increasing at a greater proportion as compare to their Selling Price.

Figure 4: Operating Income and Operating Income

Margin

SHARE PERFORMANCE:

Price per share decreased from ¥3,695 at December

31, 2017, to ¥2,159 at December 31, 2018. The number

of shares outstanding, excluding treasury stock, decreased from 349,232,466

shares at December 31, 2017, to 349,230,730 shares at December 31, 2018.

As a result, the market capitalization of the Company decreased from

¥1,290.4 billion at December 31, 2017, to ¥754.0 billion at December 31, Figure 5: Market Capitalization
2018.

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Current Economic Conditions‟ impact on Yamaha Motor Pakistan (Pvt) Ltd

As we saw that globally, Yamaha has been experiencing decrease in sales and operating profits, the same can be
witness in Pakistan as well. Unstable economic conditions in the country have made it difficult for businesses to
operate very profitably in Pakistan.

Double digit inflation and introduction of new and increased tax rates are the main factors. High inflation rate has
impacted consumer buying power to a large extend.

Pakistan expected GDP growth rate for next fiscal year is just 2.4% which is not favorable for companies to earn
profits.

Value for Pakistani rupees has been decreased by more than 20% since the formation of current government. This
devaluation has impacted cost of production to a very large extend which translated into increase in prices of cars
and motorbikes. Due to this, Pakistan Automotive industry is going through its tough times with sales declining in
almost all segments.

Yamaha Motors Pakistan has cut down its production to 17,102 units during first nine months of current fiscal year as
compare to 20,911 units in the same period last year (18.2% decline). Sales has plunged by only 0.2% during the
same period but is expected to drop more considering the deteriorating economic conditions and increasing
competition.

Production vs Sales
3,000

2,500

2,000

1,500

1,000

500

0
Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20

Production Sales
Figure 6: Yamaha Pakistan Production and Sales

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2.14. SWOT ANALYSIS:

STRENGTHS

 Excellent Branding, advertising & Global Distribution.

 Yamaha Motor Corporation has over 39,000.00 Employees
 One of the major brand in motorsport like MotoGP
 Back up support from the parent company
 Premium Technology
 Long life Engine
 Unique Product offering

WEAKNESS

 Lack of diversified product portfolio

 Emphasis on value for money
 No marketing aggressiveness
 Storage Problems

OPPORTUNITIES

 Increasing urbanization leads to growing premium segment

 First mover advantage in sports premium bikes (500cc+)
 Export opportunities
 Increased product quality

THREATS

 High Competition in the market

 Rise in raw material products
 Increase in interest rates of finance
 Cars available in the same price range
 Dependence on Government policies and rising fuel prices

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3: PROBLEM DEFINATIONS:

1. LIMITED BRAND PORTFOLIO & LACK OF DIVERSITY

If we look at the product portfolio of Yamaha Motors, we would only find three different variants of 125cc bikes.
Their product portfolio is not as diversified as their competitors’. Also, they are not targeting the masses of
Pakistan because majority of Pakistanis prefer 70cc bikes due to their lower price points.

2. LACK OF MARKETING

Yamaha’s direct competitors, Atlas Honda and Pak Suzuki, have been very successful in establishing emotional
relationship with the people of Pakistan. We can see Punjabi culture and taglines in Atlas Honda’s
advertisements. Pak Suzuki is considered as Pakistani brand due to its name and diversified product portfolio
that includes lower end cars as well. Yamaha, on the other hand, seems to be far behind the race.

3. STRONG COMPETITORS

Yamaha is having strong competition with Honda as both are offering 125cc in higher prices but Yamaha also
have strong competition with the companies such as United, Super Power and others who are offering bikes in
much lower prices than Yamaha.

4. LIMITED TARGET MARKET

Yamaha used to show TV commercials during every big cricket matches to target the desired market. But for
past few years, they have stopped mass media advertisements and they now target cricket lovers by placing
their banners on websites related to cricket.

5. LACK OF FINANCING

Unlike Atlas Honda and Pak Suzuki, Yamaha is not listed in Pakistan Stock Exchange with 100% equity from
Yamaha Motor Company, Japan, which limits their options to raise capital. With limited capital they are not able
to expand as much and as quickly as their competitors can. Atlas Honda has Shirazi Group behind them and Pak
Suzuki is a joint venture of Pakistan Automobile Corporation (PACO) and Suzuki Motor Corporation. This shows
that both the companies can increase their capital by attracting huge amount of investments.

6. IMPORTED RAW MATERIALS

Unlike Atlas Honda and Pak Suzuki, Yamaha Motor Pakistan (Pvt) Ltd is only assembling its vehicles in Pakistan
with very less localization. This makes repair & maintenance cost high as most of imported spare parts are not
easily available in the local market and are expensive as well. As Yamaha Motor Pakistan import most of its raw
material, Hence, devaluation of Pakistani Rupees and new taxation laws have also increased the cost of
Manufacturing.

7. ECONOMIC CONDITIONS

Unstable economic conditions have made it difficult for businesses to operate very profitably in Pakistan. Double
digit inflation and introduction of new and increased tax rates are the main factors. High inflation rate has
impacted consumer buying power to a large extend. Pakistan expected GDP growth rate for next fiscal year is
just 2.4% which is not favorable for companies to earn profits.

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4: ALTERNATIVES:

1. MARKET SURVEY & MARKETING

The company should conduct customer survey to know about their preferences and then extend its product line
and advertisement accordingly. They should work on their product portfolio to increase their sales by targeting a
broader market base and develop some emotional attachment through their ads.

Survey would also give them an idea about how they can alter their existing products to better meet customer’s
expectations.

2. BUILDING CUSTOMER RELATIONSHIP

Although Yamaha has started Yamaha Riders Club to engage the riders’ community of Pakistan. The club basically
arranges exciting meet-up sessions and riding rallies all across the country while also conducting special trainings
by Yamaha instructors. But they have not been successful in connecting with the broader segment. They can use
this platform to enter into streets of Pakistan and engage the youth through different activities. They can make
their bikes as a lifestyle product.

3. INCREASE COMPETITIVENESS

Yamaha should take some major steps to remain profitable. They should extend their product line and offer more
bikes of different displacement in lower price so they can be competitive for other brands who are offering bikes
in lower prices.

4. IMPROVE QUALITY

These bikes are not reliable as the parts use in them are of inferior quality in order to bring down the overall cost
of the bike. Yamaha should emphasis on the quality aspect of their bikes in order to remain competitive in this
fragmented market. They should stress on the point that good quality bikes also ensure rider’s safety and are
long-lived.

5. MARKET DEVELOPMENT

They should first define their target market in terms of their demographics and psychographics and then conduct
an extensive market research to know about them. Market research should help them identify different touch
points to engage their core target market. They should identify the interests and behavior of the target group in
order to design their marketing communication accordingly.

6. REGISTERING IN STOCK MARKET

Yamaha should also consider option to go for an IPO as they need to invest in their production and sales
operations in order to increase their market share. They also need investment to increase their marketing
spending and presence all over the country.

7. INCREASE LOCALIZATION LEVEL

Yamaha should take advantage of the Auto Development Policy (ADP 2016) and increase their localization level
by starting manufacturing parts in the country. The biggest challenge in this would be that the manufacturers of
automobile parts in Pakistan do not have advanced knowledge and technology to manufacture parts of
international standards. They can import the expertise from Japan to train local manufacturers to make high
quality parts.They should work to increase their localization level in order to ease the pressure on their gross
margins. By opting for ADP 2016, they will also be able to enjoy lower tax rates and lower duties on importing
machinery.

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 8. INCREASE COMPETITIVENESS

The company needs to take some major steps to remain profitable in this situation. Some measures could be to
increase localization level, extend the product line by offering lower end bikes and to utilize the resources
efficiently. They should invest in R&D to come with ways to decrease their cost of production.

5: RECOMMENDATIONS:

However, the company implemented the change process effectively, but there were still some weakness. So, I would
recommend some ideas which the company could have implemented for a successful change process and I will also
give some recommendations on future measures, which the company can take to bring about effective change.
These are as follows:

COST EFFECTIVE APPROACH

Yamaha went for the installation of new machinery to cope up with the technological changes. Instead of installing
the new machinery, they could have got the old machinery upgraded. This would have saved a lot of extra cost
incurred.

INTRODUCE NEW DISPLACEMENT AND MODELS

Yamaha must introduce new displacement and models in their portfolio so that they can have diversification in their
product range. Also they can target the other segments and capture the market with it.

QUICK RESPONSE TO MARKET CHANGES

Yamaha must respond to changes in the environmentally quickly. When competitors introduce new products or
services, Government agencies enact new laws, important sources of supply go out of business, or similar
environmental changes take place. Yamaha should respond quickly and should make plans to implement changes so
as to bring about an effective and a planned change process. This type of a change process will ensure less
resistance from the employees.

CHANGE IN ADVERTISMENT

As Yamaha competitors have been very successful in establishing emotional relationship with the people of Pakistan
through ads. Yamaha should develop this relation by making such ads which attracts customer emotions.

RELATION WITH EMPLOYEES

Yamaha must try to build good relations between employees in the organization, as the people working in the
organization are a mixture of Japanese, Chinese & Pakistanis which are totally different cultures. So maximum co
ordinations between Pakistanis & Japanese employees should be forced to improve the overall efficiency of the
employees.

CULTURAL EVENTS

To improve working environment in organization. Yamaha should organize cultural programmers so as to get the
Japanese and the Pakistani culture together. This would fill up the cultural gaps between employees and they would
respect each other countries which in turn is good for a bright future of the company.

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MODIFICATION IN PRODUCT DEVELOPMENT

Yamaha should add new features in their existing products to overcome competitor’s product development by adding
options like:

 Change the engine type from 4 Stroke 125cc OHC Air Cooled to 4-Stroke Single Cylinder Liquid
Cooled which is more advanced.
 Upgrading in frame for example introduce steel Trestle.
 Introduced some new bikes in 150 and 300 CC category

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