Innovative Product Marketing

ENIGMA MOTORCYCLESBIKE: FIRE BIRDRide to Glory !

BIKE CATEGORIES

History

•Was introduced by Royal Enfield and due to pollution laws, this bike is no longer produced

•Motorcycles built by Royal Enfield could be bought with 325 cc single-cylinder diesel engines

•A Saharanpur based company, Sooraj Automobiles produce diesel motorcycles

SURVEY: Conducted Among 146 Bikers

•Which bike do you currently own? (Scooty / City Bikes / Racer / Cruiser)

•How much are you ready to pay for a high-end cruiser bike?

(75,000 / 1,00,000 / 1,50,000 / 2,00,000+)

•Which is the most important aspect of the bike for a long ride?

(Comfort / Mileage / Low Maintenance)

Results of the Survey Conducted

Inferences from Survey

• India is one of the biggest market for the motorcycles industry• Majority of Indians (especially youngsters) prefer bikes over cars.• Around 85% only care about the model of the bike and not much

about the Brand• 70% riders would be interested in diesel bikes• 27% of everyday bikers are ready to spend more than 2 Lakhs

INR for a high-end cruiser bike• Major Age Group Target : 24 – 39

These factors suggest that launching a Diesel powered bike would be successful in the Indian Market.

DIESEL BIKE CONCEPTSDiesel Fuel DELHI Fuel Prices

• Much cheaper than petrol at the time, and of more reliable quality.

• Use of catalytic converter which will help reduce pollution upto 40%

BIKE Milage(Km/Ltr) Diesel(Rs/Ltr) Petrol(Rs/Ltr) Cost Per Km

FIRE BIRD 50 52.54 - 1.05

Royal Enfield 25 - 72.4 2.9

Source : http://mypetrolprice.com

DIESEL BIKE SPECIFICATIONSENGINE• Type: liquid cooled, normally aspirated, 584cc (36 cu in) double overhead cam single with four valves per cylinder.• Fuel Injection: Diesel fuel supply is through a special Fuel Injection unit and single injector • Power: 28 bhp at 5500 rpm • Torque: 1500 and 7000 rpm.

BRAKES & TYRES•Tyres Fr. 100/100 - 19•Tyres Rr. 200/200 - 18•Brakes Front: 280mm Disc, 2-Piston caliper•Brakes Rear: 153mm Disc

ELECTRICALS•Electrical System 12 volt - DC•Battery 12 volt, 14 Ah•Head Lamp 60/55 W, HALOG

Added Advantages

• Comfortable even after long hours

•Direct Selling (Helpful staff and 5 dealers – No intermediaries)

•2 years service warranty

•Auto Start + Kick Start feature

Demand

• Non-existent demand — Consumers may be unaware of or uninterested in the product.

• Latent demand — Consumers may share a strong need that cannot be satisfied by an existing

Factors affecting Demand•Due to change in the lifestyle of the majority of

youth population we are expecting the increase in business of Enigma.

•Rising Petrol Prices will create a higher demand for Enigma.

•Maintenance cost of Diesel Bikes would be higher as compared to Petrol Bikes

Demand forecasting

COMPETITORS• ROYAL ENFIELD

• HARLEY-DAVIDSON

• RAJPUTANA CUSTOMS

• IMPORTED CRUISER BIKES

Competitors’ AnalysisRoyal Enfield Harley-Davidson

Product Bullet 500cc Fat Bob 500cc

Place Two segments:MetropolitansSmall Cities

North India

Price 1,15000Rs-180000Rs 6,00,000Rs-30,00,000Rs

Advantage Brand ImageStatus SymbolTrust

Brand ImageWorld LeaderDream Bike

Source : AutoCar India

KEY CONSUMER MARKETS (B2C)•Consumer Markets: Developing a superior product,

ensuring its availability and backing it with engaging experiences and reliable service.

•GOODS, SERVICES and EXPERIENCES are Marketed

Segmentation

•NICHE SEGMENT•DEMOGRAPHIC:

▫Gender▫Age▫Income

•BEHAVIORAL:▫User Status▫Usage Rate▫Attitude Towards the Product

Occupation of Occupation of the Chief Wage the Chief Wage EarnerEarner

IlliteratIlliteratee

School School up to up to 44thth / / literatliterate but e but no no formal formal schoolischoolingng

School School – 5– 5thth to to 99thth

SSC / SSC / HSCHSC

Some Some college college but not but not graduatgraduatee

Graduate / Graduate / Post Post Graduate – Graduate – generalgeneral

Graduate / Graduate / Post Post Graduate – Graduate – professionaprofessionall

Unskilled E2 E2 E1 D D D D

Skilled workers E2 E1 D C C B2 B2

Petty traders E2 D D C C B2 B2

Shop owners D D C B2 B1 A2 A2

Businessmen / Industrialists with

Non D C B2 B1 A2 A2 A1

1 – 9 C B2 B2 B1 A2 A1 A1

10 + B1 B1 A2 A2 A1 A1 A1

Self employed D D D B2 B1 A2 A1

Clerical D D D C B2 B1 B1

Supervisory D D C C B2 B1 A2

Officers / Executives – Junior

C C C B2 B1 A2 A2

Officers / Executives – Senior

B1 B1 B1 B1 A2 A1 A1

• High Income Group (HIG) consumers continue to enlarge and spend over 40% of their monthly income on some of the world's largest luxury brands

• Delhi ranks first in spending most on luxury brands followed by Mumbai (2nd), Ahmedabad (3rd), Chandigarh (4th), Kolkata (5th), Bangalore (6th), Chennai (7th) and Dehradun (8th), says DS Rawat, secretary general of ASSOCHAM.

• Urban households compose only 9 per cent of the lowest income quintile, but represent the majority (56 per cent) of the top income quintile

Market Targeting

•Super Premium Segment•High disposable income•Technologically oriented and Status oriented• Large potential market :Long distance bike riders •Evaluating and Selecting the Market Segments

▫SINGLE-SEGMENT CONCENTRATION

Market Targeting : POPULATION

• Population in the age of 20-35 in Delhi, Haryana and Chandigarh region is 9413661.

• Percentage of motorcycle owners is 38.5% & 39.5% in rural and urban respectively

Source : Hindustan Times

POSITIONING

• Defence Forces

• Bike riders who ride for pleasure

• Point of parity :Its looks and feel are similar to Harley-Davidson which is the world leader

• Point of difference :Engine would be diesel powered and one of its kind

Marketing Mix

Product

Diesel powered cruiser Bike

Added value: comfort and mileage

Choice of colour

Price

• Four ways to calculate prices:▫ Cost-plus pricing▫ Target return pricing ▫ Value-based pricing▫ Psychological pricing

• Various price schemes for military employees.

• MoU with PNB: Which will offer motorcycle financing

for Enigma bikes at 9% in 1st year and 12% for period

of 6 years.

Pricing Methods

PRICE VOLATILITY

Aluminium Consumption Per Capita

JCP Aluminium Price Forecast to 2040 (US cents a pound)

COST PER BIKE (Estimate)

S.NO PART COST1 ENGINE 30,0002 CHASIS 24,0003 SUSPENSION 18,0004 BRAKE AND BRAKE CALIBRE 7,0005 FREE SERVICING 10,0006 WHEEL RIM 7,5007 TANK 20,0008 MUDGUARD 3,0009 HEADLAMPS 10,000

10 SADDLE 1,00011 COLOUR PAINT 10,00012 METER INDICATORS 70013 DESIGNER HELMET 5,00014 FRONT FORK 4,50015 SIDE PANEL 2,00016 MIRROR 1,00017 LEVER 8,00018 GEAR BOX 10,00019 BATTERY 300020 LABOUR 16,00021 LOGISTICS 5,00022 EXHAUST 4,00023 TYRE 5,000

TOTAL 200,000

Expenses (Estimate) Cost

1) Raw Materials 100,000,000

2) Land + Machinery 500,000,000

3) Government Approvals+ Tax 50,000,000

4) Miscellaneous 100,000,000

5) Advertisements + Promotion 100,000,000

TOTAL 85,000,000

Promotion

Based on Print and Outdoor advertisements Motorcycles are mostly purchased during warmer months and

festival seasons.

• Road Trips• Sponsoring ROADIES (1 EPISODE)• Feedback from Professional Bikers• Radio Competitions• Bikes Roaming in Selected Areas in the City

• Bike Accessories: Helmet, Jackets, watch etc.

Place

▫ Showrooms in 3 Cities as a startup :- Delhi- Chandigarh- Ludhiana

▫ Word-of-mouth

▫ Websites, blogs and Facebook page

Possible Strategies

•Make alliances with some local bike companies to produce bikes at lower manufacturing cost and get a better margin.

•Expand into Foreign Markets

•Product Development for younger market

INTENSIVE STRATEGIES

•Market Penetration (If we are able to provide customer satisfaction then expand throughout India)

•Product Development (Expand the motor cycle segment to younger generation and females)

•Market Development (If successful in India then starting new plant in Asian Countries)

Plan

• Test Launch at 3 targeted cities• Promotional Event at Buddh International Circuit• 6 Free Services and Onsite Services for first 100 buyers• Customization as per customer’s demand• Achieve a Status Symbol

Sales forecastMonth Dec-Feb Mar-May Jun-Aug

Income Rs. 12,50,000 Rs. 2,00,00,000 Rs. 3,50,00,000

Blog/Facebook Rs. 30,000 Rs. 30,000 Rs. 30,000

Advertisement Rs. 80,40,000 Rs. 40,60,000 Rs. 20,32,000

Brochure Rs. 0 Rs. 0 Rs. 11,300

Total Expenses Rs. 80,70,000 Rs. 40,90,000 Rs. 20,73,300

Profit/Loss Rs -68,20,000 (Loss)

Rs. 1,59,10,000 Rs. 3,29,26,700

Future growth Opportunities

•Availability of Quality spare parts

•Customization of the Bike according to Rider

•Women and young riders are increasingly becoming interested in bikes.

• Industry registration of heavyweight motorcycles are increasing

TECHNOLOGY• Computer based inventory

• Use of catalytic converter which will help reduce pollution

• Technology will also impact design of the Bike

• Will be using the tools and technology for Business analysis.

• Website: http://phoenixbikesindia.wix.com/enigmamotorcycles

THANK YOU !