Hyundai Motors - marketing strategies

HYUNDAI MOTOR INDIALIMITED: AN OVERVIEW

JEFFERY RANJITH JOSEPH (F14025) & JOY INFANT (F14029)LOYOLA INSTITUTE OF BUSINESS ADMINISTRATION

CHENNAI

MAKETTINGMANAGEMENT

CONTENTSABSTRACT....................................................................2

INTRODUCTION................................................................2

EARLY STAGES OF HYUNDAI.....................................................2

MARKETING STRATEGY 2013.....................................................3

HYUNDAI SWOT ANALYSIS.......................................................3

LOGO........................................................................5

DESIGN ELEMENTS OF HYUNDAI LOGO.............................................6

SITUATION ANALYSIS..........................................................6

OBJECTIVES..................................................................6

STRATEGIES PRODUCT..........................................................7

MARKETING COMMUNICATIONS....................................................8

MARKETTING PRODUCT MIX......................................................8

Price.................................................................8

Promotion.............................................................9

TAREGET SEGMETATION..................................................10

PROBLEMS FACED BY HMIL:....................................................10

SEGMENTING & TARGETING.....................................................11

FOUR P'S...................................................................11

PRICE................................................................11

PLACE................................................................12

PROMOTION............................................................12

POSITIONING..........................................................12

STRATEGY ADOPTED BY HMIL...................................................12

OPPORTUNITIES FOR THE CAR INDUSTRY IN 1980S................................13

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OPPORTUNITIES USED BY HMIL IN THE INDIAN CAR MARKET........................13

Marketing strategies for TATA Nano (Four P's) Product a....................13

CONCLUSION:................................................................14

REFERENCES:................................................................15

ABSTRACTHyundai Motor India Limited is India’s leading exporter of passengercars with a market share of 48 percent of the total exports ofpassenger cars from India. With a prime objective to fulfill the needsof diversified customers, the company has been continuously offeringvariety of its brands with innovative features to Indian customers.Since inception, Hyundai Motors India Limited has dominated theautomobile market with the reputation of being the fastest growingautomobile manufacturer in India. Presently, Hyundai Motor isconsidered as the largest exporter of automobiles to Europeancountries. The object of this paper is to evaluate the performance ofHyundai Motors India Limited with respect to Domestic Sales, Export,and Profit after tax, Production

KEYWORDS: Domestic Sales, Export, Profit after tax, Production.

INTRODUCTION

The Hyundai Motor Company is a South Korean multinational automotivemanufacturer headquartered in Seoul, South Korea. The company wasfounded in 1967 and, along with its 32.8% owned subsidiary, KiaMotors, together comprise the Hyundai Motor Group, which is theworld's fifth largest automaker based on annual vehicle sales in 2012.In 2008, Hyundai Motor (without Kia) was ranked as the eighth largestautomaker. As of 2012, the Company sold over 4.4 million vehiclesworldwide in that year, and together with Kia total sales were 7.12million.Hyundai is currently the fourth largest vehicle manufacturer in theworld. Hyundai operates the world's largest integrated automobilemanufacturing facility in Ulsan, South Korea, which has an annual

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production capacity of 1.6 million units. The company employs about75,000 people worldwide. Hyundai vehicles are sold in 193 countriesthrough some 6,000 dealerships and showrooms.

EARLY STAGES OF HYUNDAI

Chung Ju-Yung founded the Hyundai Engineering and Construction Companyin 1947. Hyundai Motor Company was later established in 1967. Thecompany's first model, the Cortina, was released in cooperation withFord Motor Company in 1968. When Hyundai wanted to develop their owncar, they hired George Turnbull, the former Managing Director ofAustin Morris at British Leyland. In 1984, Hyundai exported the Ponyto Canada, but not to the United States, because the Pony didn't passemissions standards there. Canadian sales greatly exceededexpectations, and it was at one point the top-selling car on theCanadian market. In 1985, the one millionth Hyundai car was built.

The 1960s will be conducive to Chung Ju-yung who puts his talents toKorea General Park Chung-hee. It will be the builder of the highwaythat connects Seoul to Busan in 1968. He engages in shipbuilding,where excellent Koreans. Its shipyards will become the largest in theworld, including those of Ulsan. In 2006, Hyundai is the largestshipbuilder global production value.

Hyundai Motors was established in 1967. The company will produce thefirst Korean car 100% from 1973, the Pony. Chung Ju-yung immediatelyunderstands the economic importance of public works and constructionin the Middle East, where South Korea imports most of its hydrocarbonconsumption. Hyundai will be chosen several times to make majorinfrastructure projects in the Middle East. In 1983, HyundaiElectronics is created in a form of diversification. His businessgrows primarily on the markets for precision engineering,petrochemical and robotics. The group also created a subsidiary,Hyundai Asan specializes in projects of cooperation between SouthKorea and North Korea.

Having bought the Kia brand in 1998, Hyundai Motor is now the 5th carmanufacturer, with 3.7 million vehicles sold worldwide. First Koreancar manufacturer, Hyundai became the first employer in the countrywith 170 000 workers, and second behind Samsung in the turnover.

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MARKETING STRATEGY 2013

The car at first glance resembles a styling pastiche derived fromHonda, Fiat, BMW and a few other manufacturers, can easily beforgiven. Once inside the car and with express orders to drive it, thestyling puzzle tends to become a lot less significant. And the adageabout imitation being the most sincere form of flattery springs tomind. This section takes you through the marketing plan for HyundaiPa. ‘‘Hyundai PA will bridge the gap between Santro and Getz, givingcustomers more options within the Hyundai family''. Hyundai Pa will bea hatchback aimed squarely at the new Zen Estilo from Maruti. Hyundaiis also said to be working on a one-liter diesel engine for Pa, whichmay just prove to be a good strategy to take on Maruti with. It willbe a true ‘Value-for-money’ product and will be available in variedcolors suited to the Indian market. The company’s under-developmentcompact car, code named project PA, will also be exclusively made andexported from India. Hyundai exports Santro and Accent models fromIndia.

Running around the clock and selling everything it can build, HyundaiMotor's Indian factory is bursting at the seams. But as demand growsand rivals scale up, the car maker has chosen to take its foot off thepedal.

Hyundai's strategic decision to focus on quality over quantity, evenas its production lines are stretched in India and elsewhere, riskslosing hard-won market share and is forcing it to divert output fromits plant outside Chennai away from exports to other high-growthmarkets to meet domestic demand.

HYUNDAI SWOT ANALYSIS

Strengths

1. Growing brand reputation. Hyundai’s brand is the secondfastest growing brand in the automotive sector. In 2012,Hyundai’s brand value grew by 24% to US$ 7.43 billion andbecame the 53rd most valuable brand in the world, according to

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Interbrand. This is a result of Hyundai’s excellent qualitycars, marketing efforts and growing customer base.

2. Strong focus on R&D. Hyundai has established R&D centers in 6different locations and has smaller R&D offices all around theworld. Firms commitment to innovation yielded positive resultsand the business has become one of the automotive leaders inproducing high quality, reliable, durable and safe cars. Ithas received many rewards including the latest North AmericanCar of the Year reward in 2012.

3. Effective resource allocation. For the 2011 financial year,Hyundai’s ROE was 20.6% compared to GM’s 19.9% and Toyota’s4%, generating very high returns for the shareholders. Inaddition, Hyundai was using its assets more efficient thancompetitors with 7% ROA compared to GM’s 5.2% ROA and Toyota’s1.4% ROA.

4. Growth in Europe. While the Europe’s car sales were falling in2012, Hyundai was experiencing significant growth in theregion. It grew its market share in Europe from 2.9% in 2011to 3.5% in 2012. This growth led to a competitive advantageover its rivals, Toyota and Volkswagen that were incapable togrow their operations.

5. Successful marketing campaigns. Hyundai has launched manysuccessful marketing campaigns through their CSR programs,sponsorship of many sport events and using celebrities topromote their products, which resulted in increased brandpopularity.

Weaknesses

1. Product recalls. Over 2012, Hyundai recalled more than 300,000cars in different regions to fix manufacturing and design

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defects. Product recalls negatively impact Hyundai’sreputation and could erode its competitive advantage.

2. Hyundai has no presence in Japan’s car passenger market.Hyundai has pulled their passenger car division from Japan in2009 due to low sales and weak brand perception. Japanrepresents a large automotive market and performing poorly inthis market leaves Hyundai at competitive disadvantage.

3. Negative publicity. In 2012, Hyundai has been accused overinflated fuel economy numbers. Now the business will facefederal lawsuit and will have to reimburse all the damage doneto the customers.

Opportunities

1. Increasing fuel prices. Increasing fuel prices open up largemarkets for Hyundai’s hybrid, electric and hydrogen fueledcars as consumers shift towards cheaper fuel types.

2. Global demand for ecological vehicles. Cars that emit largequantities of CO2 pollute air and negatively affect theenvironment. Consumers are aware of this negative impact andwill likely choose fuel-efficient hybrid, electrical orhydrogen fueled cars that Hyundai is currently offering.

3. Changing customer needs. By introducing new car models,Hyundai could satisfy varying consumers’ tastes and needs formore fuel-efficient, ecological cars and access wider customergroup.

Threats

1. Exchange rates. Hyundai earns more than half of its revenueoutside the South Korea. Exchange rate fluctuations threatenHyundai’s profits if the KRW would appreciate against othercurrencies.

2. Rising raw material prices. Raw metal prices (main rawmaterial for car manufacturers) are rising due to increasingglobal demand, negatively affecting automotive firms’ profits.

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3. Decreasing fuel prices. Some analysts argue that due to shalegases future fuel prices should drop as a result making hybridand alternative fuel cars less attractive to consumers.

4. Intense competition. Hyundai faces strong competition fromother automotive companies and more than ever competes onprice rather than differentiation lowering firm’s profits.

LOGO

The history of Hyundai is linked to that of its founder, Chung Ju-yung(1915-2001). Farmer's son, he left his family at 16 years andpractices several odd jobs to survive maneuver, rice dealer andrepairer of cars. In 1947 he founded Hyundai Engineering &Construction (Hyundai means "modernity" in Korean), which remained thecenter of his group. After the Korean War, the American Ford entrustthem compensation for their military vehicles and construction ofbarracks for the army of the United States.

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DESIGN ELEMENTS OF HYUNDAI LOGO

Shape of the Hyundai Logo:

The Hyundai logo depicts an oval-shaped letter “H” from the companyname “Hyundai”. It is a symbolic representation of the company’sdesire to expand globally. The ovaloid shape represents the company’sglobal expansion. The slanted, stylized “H”, on the other hand, issuggestive of two people (the company and the customer, in particular)shaking hands.

Color of the Hyundai Logo:

The blue color in the Hyundai logo represents excellence, supremacyand trustworthiness.

SITUATION ANALYSIS

Hyundai Motor India Limited (HMIL) is a wholly owned subsidiary ofHyundai Motor Company, South Korea and is the second largest and thefastest growing car manufacturer in India. HMIL presently markets 20variants of passenger cars in six segments. The Santro and Pa in the Bsegment, GetzPrime in the B+ segment, the Accent and Verna in the Csegment, the Elantrain the D segment, the Sonata Embera in the Esegment and the Tucson in these segment. Hyundai Motor India,continuing its tradition of being the fastest growing passenger carmanufacturer, registered total sales of 299,513vehicles in calendaryear (CY) 2006, an increase of 18.5 % over CY 2005. In the domesticmarket it clocked a growth of 19.1 % as compared to 2005, with186, 174units, while overseas sales grew by 17.4 %, with exports of113,339units.HMIL’s fully integrated state-of-the-art manufacturingplant near Chennai boasts some of the most advanced production,quality and testing capabilities in the country. In continuation ofits investment in providing the Indian customer global technology,HMIL is setting up its second plant, which will produce an additional300,000 units per annum, raising HMIL’s total production capacity to600,000 units per annum by end of 2007.HMIL is investing to expandcapacity in line with its positioning asHMC’s global export hub forcompact cars. Apart from expansion of production capacity, HMIL plansto expand its dealer network, which will be increased from 183 to 250

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this year. And with the company’s greater focus on the quality of itsafter-sales service, HMIL’s service network will be expanded to around1,000 in 2007.The year 2006 has been a significant year for HyundaiMotor India. It achieved a significant milestone by rolling out thefastest 300,000th export car. Hyundai exports to over 65 countriesglobally; even as it plans to continue its thrust in existing exportmarkets, it is gearing up to step up its foray into new markets. HMILhas also been awarded the benchmark ISO 14001certification for itssustainable environment management practices

OBJECTIVES

First year Objectives: We are aiming for 5% market share of the Indianmarket through unit sale volume of 100000.Second year Objectives: Weare aiming for 10% market share of the Indian market. An importantobjective will be to establish a well-regarded brand name linked to ameaningful positioning. We will have to invest heavily in marketing tocreate a memorable and distinctive brand image projecting innovation,quality and value. We also must measure awareness and response so wecan adjust our marketing efforts if necessary.

Hyundai Pa’s marketing strategy is differentiated marketing. Ourprimary consumer target is middle to upper income professionals whoneed true value for their money and comfortable ride in cityconditions. Our secondary consumer target is college students who needstyle and speed. Our primary business target is mid-sized to largesized corporates that want to help their managers and employees byproviding them a car for ease of transport. Our secondary businesstarget is entrepreneurs and small business owners who want to providediscounts to managers buying a new car. Each of the four marketingstrategies conveys Hyundai PA’s differentiation to the targetmarketing segments identified above.

STRATEGIES PRODUCT

Price

Hyundai Pa’s base model will be introduced at ex-showroom price of3lakhs. This price reflects a strategy of 1) attracting desirablechannel partners2) Taking market share from Maruti.

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Distribution

The Stockist will represent 3 to 4 districts in a State.

The Dealer will represent a district or main City.

The Sub-Dealer shall represent a particular area or taluks.

The booking agents will be individuals working on freelancebasis.

Marketing Santro

Santro received an encouraging feedback from customers who appreciatedits unique design that gave more headroom and facilitated easy entryand exit.

Launch of Accent

By mid-1999, the major players realized that the 'B' segment would bethe fastest growing in the car industry. To cash in, Telco re-launchedits 'Indica' by introducing several new features and solving theglitches in the original model...

Marketing Management Case Studies | Case Study in Management,Operations, Strategies, Marketing Management, Case StudiesRepositioning Santro

By late 2002, the competition in the B segment had increasedsignificantly. MUL's Alto which was launched in October 2000 hadreceived a good response. Although HMIL's Santro remained the largestselling car in the B segment, MUL commanded the largest market sharein this segment due to the combined sale of its three cars - Zen,Wagon R and Alto...

Status in 2004

The financial year 2003-04 ended on a positive note for HMIL. Thecompany achieved revenues of Rs 50 bn and profit after tax (PAT) ofRs. 1.90 bn in the financial year 2003-04 compared to Rs 43 bnrevenues and PAT of Rs 1.65 bn in the fiscal 2002-03...

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The Challenges Ahead

During the period January to June 2004, Santro lost its leadershipstatus in the B segment.

MARKETING COMMUNICATIONSBy integrating all messages in all media we will reinforce the brandname & main points of product differentiation. Research about mediaconsumption, pattern will help our advertising agency to chooseappropriate media and timing to reach prospects before & during theproduct introduction. Thereafter, advertising will appeared on apulsing basis to maintain brand awareness and communicate variousdifferentiation messages. The agency will also co-ordinate publicrelation efforts to build Hyundai brand & support the differentiationmessage. To attract market attention & encourage purchasing, we willoffer a limited time, registration & insurance. To attract, retain &motivate channel partners for a push strategy, we will use trade salespromotions and personal selling to channel partner.

MARKETTING PRODUCT MIXFeatures: The all-new “Hyundai Pa” is fully loaded with a range ofexciting new features. It's a perfect complement to your evolvedtastes and lifestyle. And the best way to take your driving pleasureto a brand-new high. European Styling. Japanese Engineering. Dream-Like Handling.

The new Hyundai Pa is a generation different from Getz and Santrodesign. Styled with a clear sense of muscularity, its one-and-a-halfbox, aggressive form makes for a look of stability, a sense that it ispacked with energy and ready to deliver a dynamic drive. Its solidlook is complemented by an equally rooted road presence and class-defining ride quality. New chassis systems allow for the frontsuspension lower arms, steering, and gearbox and rear engine mountingto be attached to a suspension frame. You get lower road noise and agreater feeling of stability as you sail over our roads with feather-touch ease.

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PriceHyundai is expected to take Maruti heads on with the pricing of theirupcoming Hyundai Pa car. After launching cars for the masses since somany years, India’s second largest automobile manufacturer is nowtargeting the premium segment with their latest model from theHyundai’s stable. The analysts predict the pricing of this premiumhunchback to start from Rs. 3lakh.This price range would practicallyrip apart Maruti’s offering in Zen Estilo, which is priced at a highertag of Rs. 3.5 lakh. Both the companies are known for their valuebased offerings and Hyundai with their extensive service network andbrand reputation for making reliable cars should get the customer’snod over their competition. The official pricing however is still notout. However, the company is said to be studying the prospects oflaunching the base model at the 3 - lakh price tag. If they indeed dotake the chance of pricing Hyundai at a considerable lower price thanZen Estilo , they would quite likely force the competition to rethinktheir strategy.

Promotion

Road Shows

The company plans to stage road shows, to display vehicles in thepavilions during various college festivals and exhibition. This carwill appeal to youngsters more.

Television advertisements

Advertisements to promote and market our product will be shown onleading television channels. Major music and sports channels willpromote and they will reach out to the youth will be promoted throughStar, Zee, Sony and Doordarshan etc. as it has more viewers.Hyundai Suicide Ad It was shaping up to be a great, great week for Hyundai. On April 19,the car maker's new ad for the British market, which centers around aman attempting suicide in his new Hyundai, was named Ad of the Week byThe Drum — a well-thought-of U.K. marketing magazine. On Thursday,April 25, The Guardian also highlighted the spot as worth a watch.

Hyundai's marketers thought they had a potentially huge hit on theirhands: Maybe it would even win some awards for its originality. Car

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advertising is usually riddled with visual clichés, such as the openroad, night-time city driving, and over-the-top stunts like drivingthrough walls of flames or crystal chandeliers.

Radio

Radio is the medium with the widest coverage. Studies have recentlyshown high levels of exposure to radio broadcasting both within urbanand rural areas, whether or not listeners actually own a set. Manypeople listen to other people's radios or hear them in public places.So radio announcements will be made and advertisements will beannounced on the radio about the product features and price,qualities, etc.

Print Ads

Daily advertisements in leading newspapers and magazines will be usedto promote the product. Leaflets at the initial stage will bedistributed at railway stations, malls, college areas and variousother locations.

Workshops and Seminars

Workshops and seminars will be held in colleges and big corporate tomake people aware about the companies past performance and productfeatures, its affordability and usage, vast distribution network. Roadshows will be conducted where free trials of the car would be given.

Banners, neon signs

Hoardings, banners, neon signs will be displayed at clubs, discs,outside theatres and shops to promote our brand car.

Booklets and pamphlets

Booklets will be kept at car showrooms, retail battery outlets, etc.for the customer to read. These booklets will provide informationabout our company; the products offered which suits the customers needaccordingly.

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TAREGET SEGMETATION

Hyundai took the bull by the horns in this bear market and scored big.It used behavioral segmentation to identify what was keeping prospectsfrom buying and then developed a strategy that made it easier forcustomers to part with their hard-earned dollars.

What can you learn from its example? In every market change, even adownturn, there is an opportunity to use the power of behavioralsegmentation to make your product or service stand out. Hyundaidiscovered that as the market changed so did their segmentation.Significant numbers of prospects were no longer focusing on gasmileage performance, and they weren't necessarily looking for morediscounts. Armed with such customer insight, Hyundai identified abusiness opportunity. Hyundai determined that the fear of losing one'sjob was a high barrier preventing prospective buyers from purchasing acar.

After defining the segment, the company developed and aligned salesand marketing strategies to reach this new segment. By targetingprospects concerned about job security, Hyundai broadened its audienceand increased the number of customers who considered its cars.

David Zuchowski, vice-president of national sales for Hyundai noted ina New York Times article, "It doesn't matter how many zillion dollarsyou put in rebates, or what APR you give them. If people are worriedabout their job, they don't really care and they're just not going toget off the fence."

Strategy to Target Segment

Next, Hyundai developed a strategy to ease the fears of this segment:The Company’s Assurance Program releases customers from car paymentswithout harming their credit score.

As Advertising Age editor Jonah Bloom wrote, "Right there, is anhonest-to-goodness big marketing idea.... Hyundai confronts therecession head-on and does something tangible to tackle its effects."

Hyundai advertising used straight talk that resonated with customers:"We're introducing Hyundai Assurance to show you the faith we have inyou. Right now, finance or lease any new Hyundai, and if in the nextyear you lose your income we'll let you return it. That's the HyundaiAssurance."

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PROBLEMS FACED BY HMIL:

Hyundai launched its 'B' segment vehicle Hyundai Getz in a periodwhen there was intense demand for Hyundai Santro causing thedemand for Santro to go down. The impact was very high that eventhe market leader tag was lost to MUL.

The competition among other motor companies dominated this erathereby paving way for HMIL to lose its market share to rivalslike MUL, Ford, and Mitsubishi etc.

Though the demand for Hyundai cars where very high owing to plantproduction constraints it cannot match up to its expected demandthereby losing a part of its share to its competitors.

The introduction of newer cars meant to new segment reach, newcustomers, new technology etc. but HMIL just did not concentratean simultaneous promotional campaigns causing far the drop downin advertisements for existing products which were doing well inthe market. This meant losing of customers and paving way forcompetitors.

SEGMENTING & TARGETING

Maruti Udyog Ltd. (MUL) targeted the 'A' segment of the market bylaunching its Maruti 800 for Rs. 40,000. This was due to an initiativeof the Government of India to produce a small and affordable cartargeting the Indian middle class. Hyundai Motors India ltd. (HMIL) onthe other hand entered the market by

Targeting the 'B' segment. HMIL believed that the middle class Indianconsumer would not mind paying extra for value addition. Hence HMILentered the Indian market by targeting the 'B' segment.

After its initial launch in 1983, MUL also targeted the B and Csegments with the launch of ' Zen' and 'Esteem' respectively .MUL alsowent on increasing its market share in the B segment by launching'Alto' and 'Wagon R' models. The combined sales of the three models(viz: 'Zen', 'Alto' and 'Wagon-R') ensured MUL to gain a dominantshare in the 'B' segment. The luxury 'D' and 'E segments were howevernot covered by MUL.

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Conversely HMIL did not introduce any other model besides 'Santro' inthe B segment. HMIL targeted the rural market as well in selling`Santro'. On the contrary MUL did not target the rural market for anyof its car in the 'B' segment. HMIL however entered the 'C' segmentwith the launch of 'Accent'. HMIL also entered the D segment and theLuxury `E' segment by launching 'Sonata' and 'Elantra' models. By July2004, HMIL introduced another model 'Getz' which specifically targetedthe upper B segment.

FOUR P'SProduct: All products of HMIL had some distinguishing features thatenabled them to become the market leaders of their particularsegments. Santro had its unique design features such as; more headroom providing easy entry and exit, higher positioning of the driverseat which ensured better visibility, safety features like child lockrear doors, crumple zone to absorb frontal impact and, ergonomicallydesigned seats to ensure comfort. Accent had the latest technology,Sonata had its luxurious design and Getz had a larger space comparedto other cars in the same segment.

PRICE

All products of HMIL were priced lower than its competitor's productsin their respective segments to gain substantial market share. Santrowas priced at Rs.2, 89,000 compared to MUL's Zen which was priced atRs.3, 45,000. Accent was priced at Rs.5, 35,000 as compared toMitsubishi's 'Lancer' at Rs.7, 80,000. 'Sonata' was priced at Rs.16,00,000 compared to Honda's Accord which was

priced at Rs. 17,00,D00. HMIL also followed a unique "pricing based oncustomer value perceptions" strategy in which different models of thesame brand had different features and customers had to pay based onthe features they prefer in the car. This strategy was employed byHMIL in the pricing of Santro brand wherein the three models wereSantro LP, Santro GS and Santro LE.

PLACE

HMIL was very cautious in selecting its dealers. It had an elaborateselection procedure wherein every prospective dealer had to fill up adetailed application form revealing his personal information,financial status, asset value, liabilities, impending legal

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proceedings etc. The dealers were also required to have a soundknowledge of the market position and the current trend and position ofcar sales in their specific region. Other minute details like distancebetween showroom and workshop, organizational structure and referenceswere also sought by HMIL. These details helped HMIL to scientificallydecide, which applicant was to be picked for a particular location fordealership. Dealers from rural areas were also selected for pushingthe sales of Santro in these regions.

PROMOTION

HMIL used different media for the promotion of its various brands.Santro was promoted by television advertisements featuring the productfeatures and customer responses to Santro. HMIL had given theadvertising contract to Saatchi & Saatchi. In rural areas Santro waspromoted by organising road shows and offering test drives. Accent onthe other hand was promoted through the Print media. The reason was,since Accent was a higher value product it appealed to a specific kindof audience. HMIL gave the responsibility of advertising campaign ofAccent to Grey Worldwide India (GWI). Accent CRDi was however promotedthrough television advertisement as it was a new technology used inthe Indian Automobile Industry. Sonata was also promoted throughtelevision advertisements.

POSITIONING

HMIL positioned its cars as follows;

Santro: Santro was initially positioned as the Family car' targetingthe age group of 35-45 years. When the competition intensified in the'B' segment, Santro was again repositioned in October 2002 as the'Sunshine car'. The basic idea was to target young customers of theage group of 25-35 years.

Accent: HMIL positioned its model 'Accent' as The next step'. This wasdone to highlight the latest technology used in the car.

Sonata: Sonata was positioned with the tag line as 'Dreamt about byeveryone, owned by select few'. This line highlighted the luxuryfeature of the model.

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STRATEGY ADOPTED BY HMIL

As an entry strategy Hyundai motors corporation (HMC) set up itssubsidiary in India and named it Hyundai Motors India Ltd (HMIL). Thiswas contrast to other foreign companies who entered the Indian marketby forming joint ventures with Indian companies. HMC wanted toleverage upon the low manufacturing and labour costs in India. Henceit set up its own manufacturing plant at Irrungattukottai nearChennai. In contrast other companies only established their assemblingunits in India.

HMIL used superior technology in its products, which gave it acompetitive advantage over its competitors. As a result Santro andAscent became the market leaders, although they were the sole productsof HMIL in their respective segments.

HMIL also widened its portfolio by introducing one product in eachsegment and also made sure that the product had a substantial marketshare in its segment.

HMIL was the first company to introduce what became popular as the"pricing based on customer value perceptions". Based on this strategyHMIL had introduced three models of Santro with varying features anddifferent prices.

HMIL had its unique interacting methodology with its dealers, whichgave HMIL a better understanding of the customers.

OPPORTUNITIES FOR THE CAR INDUSTRY IN 1980S

In the early 1980's the automobile industry was highly protected withonly two players Premier Automobiles (PA) and Government of India(G❑1). This lead to very little technological improvements in theindustry thus for poor technology people had to pay higher prices. Asa result of which the CAGR was just 3.5% since most of the middleclass could not afford to buy such a high priced car. At this momentthe GOI felt the need to introduce a small car that is affordable byIndian middle class. There was a huge potential for this market butthe sector was not opened up for other players.

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A company with more focus on technology or having a tie-up withforeign players for latest technology could have improved the qualityof cars. This would have given an edge to the company compared to theother players PA and GOI which weren't technologically savvy. Alongwith it a company could have reduced their prices too and stillmaintain higher margin by virtue of huge market potential.

OPPORTUNITIES USED BY HMIL IN THE INDIAN CAR MARKET

HMC was the first foreign company to set up its own subsidiary HMILand its own manufacturing plant. HMIL discovered that there was apotential market for small cars and hence went on with theintroduction of Santro. HMIL also discovered that the middle classcustomers belonging to the 'B' segment would not mind paying a littlehigher price for better comfort and hence targeted this segment inparticular. HMIL also recognised the opportunities in other segments(C, ❑ and E) and launched new products in these segments, which wenton to become quite successful.

Marketing strategies for TATA Nano (Four P's) Product aThe features of TATA Nano are given below:-

Tata's Nano will have 624 cc Petrol Engine and it will give 33bhp power (engine is in rear)

This car will give fuel average of 20-25 Km/litre Top speed of Nano will be 90 Km/hour Petrol tank of this car will have capacity of 30 litres Nano will be available in three colours red, yellow and silver This car can accommodate 4-5 people Nano will meet Bharat 3 and Euro 4 emission standards Tata will launch one basic and two deluxe models (with AC) of

this car Length of car is 3.1 meter and its width is 1.5 meter The high end/deluxe models will include air-conditioning and

other features to be incorporated based on suggestions of thecommon people

The most important feature of TATA Nana is that it has 21% marespace and 8% smaller than Maruti 800, which is the nest cheapestcar in the A segment

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Price: Price to the distributor of Nano in Delhi will be Rs 1 Lakh andits actual price will be slightly more than 1 lakh for customers. Atabout $2,500 retail, the Nano is the most inexpensive car in theworld. Its closest competitor, the Maruti 800, made in India by MarutiUdyog [Get Quote], sells for roughly twice as much. To put this inperspective, the price of the entire Nano car is roughly equivalent tothe price of a DVD player option in a luxury Western car. The lowprice point has left other auto companies scrambling to catch up.

Place: TATA Nano is believed to be a new revolution in Indian carmarket and many experts believe that this car also has lot ofpotential for world market too.

The main place of launching the product is the urban cosmopolitanmarket.

The rural market in India can provide a huge opportunity for this car.Since it's a very cheap car and is easy to maintain, the lessestablished and less educated people will want to buy the car. Thetechniques initially developed to reach poor and rural customers mayhave even greater potential when used to reach highly demanding,affluent, urban customers in Western economies.

Promotion: In order to provide an added facility to help its Nanocustomers to finance the car, Tata Motors has entered into anunderstanding with Corporation Bank. Corporation Bank has loweredtheir car loan rates and now offers loan up to 85% of on road price,for tenure ranging up to 5 years, at a very competitive rate of 11.75%p.a. The dealer network will be fully trained to explain the loanformalities and will help customers in completing the documentationrequired for availing car loans from the bank. Both the organizationshave jointly organized sales promotion activities by display eachother's products and offerings at their respective premises. This tie-up will provide a single window far both cars as well as car loans andwill make Nano buying easier for customers.

CONCLUSION:Today, despite tough competition, Hyundai Motor India Limited hascreated a different identity in Indian automobile market. Hyundai’sgrowth has been driven by volume oriented revenues coupled withtechnological soundness, constant innovations and superior designs.Currently, Hyundai have a complete line up of cars across allsegments. Considering the changing needs of Indian customers, the

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company always fulfilled the expectations of customers by giving themtechnologically advanced cars with more features and more value formoney. Evaluating the past performances of Hyundai Motor, no doubtthat in coming future Hyundai Motor will be the leader in IndianAutomobile industry.

REFERENCES:

Hyundai Motor India Production touches 6 Lakh units in 2010,press release, 30/12/2010, retrieved from http://www.hyundai.com

Hyundai Motor India Launches Eon in Chennai, Chennai, 17 October2011, retrieved fromhttp://www.thehindubusinessline.com/industry-and-economy

Hyundai Motor India Sales up 3.6 pct, The Indian Express, NewDelhi, 2 Jan 2012, retrieved from http://www.indianexpress.com

Hyundai Motor India sales down 2.2 % in November, The FinancialExpress, New Delhi, 1 December 2012, retrieved fromhttp://www.financialexpress.com

Interview of Mr.Arvind Saxena (VP-Mktg & Sales, Hyundai Motors),retrieved from http://www.exchange4media.com

Production, Export retrieved from http://www.hyundai.com

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