A Project Report ON
Study and scope of online channel for selling two wheelers.
AS PARTIAL FULFILLMENT OF PGDM PROGRAM, II year
SUBMITTED BY(Saurabh kainth)PGDM DM13C41
IAEER'S Pune Institute Of Business Management
(Approved by AICTE, Ministry of HRD, Govt. Of India)
PUNE
Batch- (PGDM) 2013-2015
DECLARATION
I, Saurabh Kainth hereby declare that this project report is the
record of authentic work carried out by me during the period from
15th May 2014 TO 15th July 2014 and has not been submitted earlier
to any university or institute for the award of any degree/diploma
etc.
Name of the Student:Date:
CERTIFICATION
This is to certify that Mr Saurabh Kainth has completed SIP
under my guidance.Date of submission:
Signature(Internal Guide)ACKNOWLEDGEMENT
I take this opportunity to express my deep sense of gratitude
to, of our college for their good wishes, support and encouragement
for the completion of my project. I am sincerely thankful to Mr.
Sunil Singh (V.P H.R) for his help and support throughout the
project. I extend my thanks to Mr.Nitin Hemnani (corporate guide)
for his help. I extend my sincere thanks and my deep sense of
gratitude to Ms.Sonal parmar (internal guide & mentor) for his
kind assistance. I would also like to thank all the staff of the
organization for helping me directly and indirectly to conclude
this work, last but not the least, my heartfelt gratitude to my
parents, relatives and my friends for their constant encouragement,
support, help and valuable advice to make this project a
success.
TABLE OF CONTENTS
Sr. No.TopicsPage Nos.
1.Background/Introductiona) Basic introduction of the projectb)
Industry profilec) Company Profile7-11
12-1617-20
2.Research Methodologya) Objectives & scopeb) Methods&
Tools adopted c) Data analysis & Interpretationd)
Limitations21-23 24
25-6061
3.Findings & Observations.62-63
4.Suggestions/ Recommendations.64-65
5.Conclusion.66-67
6.Bibliography.68-69
Introduction
Introduction
Channels of DistributionA channel of distribution or trade
channel is defined as the path or route along which goods move from
producers or manufacturers to ultimate consumers or industrial
users. In other words, it is a distribution network through which
producer puts his products in the market and passes it to the
actual users. This channel consists of :- producers, consumers or
users and the various middlemen like wholesalers, selling agents
and retailers(dealers) who intervene between the producers and
consumers. Therefore, the channel serves to bridge the gap between
the point of production and the point of consumption thereby
creating time, place and possession utilities.A channel of
distribution consists of three types of flows:- Downward flow of
goods from producers to consumers
Upward flow of cash payments for goods from consumers to
producers
Flow of marketing information in both downward and upward
direction i.e. Flow of information on new products, new uses of
existing products,etc from producers to consumers. And flow of
information in the form of feedback on the wants, suggestions,
complaints etc from consumers/users to producers.An entrepreneur
has a number of alternative channels available to him for
distributing his products. These channels vary in the number and
types of middlemen involved. Some channels are short and directly
link producers with customers. Whereas other channels are long and
indirectly link the two through one or more middlemen.
These channels of distribution are broadly divided into four
types:- Producer-Customer:- This is the simplest and shortest
channel in which no middlemen is involved and producers directly
sell their products to the consumers. It is fast and economical
channel of distribution. Under it, the producer or entrepreneur
performs all the marketing activities himself and has full control
over distribution. A producer may sell directly to consumers
through door-to-door salesmen, direct mail or through his own
retail stores. Big firms adopt this channel to cut distribution
costs and to sell industrial products of high value. Small
producers and producers of perishable commodities also sell
directly to local consumers.
Producer-Retailer-Customer:- This channel of distribution
involves only one middlemen called 'retailer'. Under it, the
producer sells his product to big retailers (or retailers who buy
goods in large quantities) who in turn sell to the ultimate
consumers.This channel relieves the manufacturer from burden of
selling the goods himself and at the same time gives him control
over the process of distribution. This is often suited for
distribution of consumer durables and products of high value.
Producer-Wholesaler-Retailer-Customer:- This is the most common
and traditional channel of distribution. Under it, two middlemen
i.e. wholesalers and retailers are involved. Here, the producer
sells his product to wholesalers, who in turn sell it to retailers.
And retailers finally sell the product to the ultimate consumers.
This channel is suitable for the producers having limited finance,
narrow product line and who needed expert services and promotional
support of wholesalers. This is mostly used for the products with
widely scattered market.
Producer-Agent-Wholesaler-Retailer-Customer:- This is the
longest channel of distribution in which three middlemen are
involved. This is used when the producer wants to be fully relieved
of the problem of distribution and thus hands over his entire
output to the selling agents. The agents distribute the product
among a few wholesalers. Each wholesaler distribute the product
among a number of retailers who finally sell it to the ultimate
consumers. This channel is suitable for wider distribution of
various industrial products.An entrepreneur has to choose a
suitable channel of distribution for his product such that the
channel chosen is flexible,effective and consistent with the
declared marketing policies and programmes of the firm. While
selecting a distribution channel, the entrepreneur should compare
the costs,sales volume and profits expected from alternative
channels of distribution and take into account the following
factors:- Product Consideration:- The type and the nature of
products manufactured is one of the important elements in choosing
the distribution channel. The major product related factors are:-
Products of low unit value and of common use are generally sold
through middlemen. Whereas,expensive consumer goods and industrial
products are sold directly by the producer himself. Perishable
products; products subjected to frequent changes in fashion or
style as well as heavy and bulky products follow relatively shorter
routes and are generally distributed directly to minimise costs.
Industrial products requiring demonstration, installation and
aftersale service are often sold directly to the consumers. While
the consumer products of technical nature are generally sold
through retailers. An entrepreneur producing a wide range of
products may find it economical to set up his own retail outlets
and sell directly to the consumers. On the other hand, firms
producing a narrow range of products may their products distribute
through wholesalers and retailers. A new product needs greater
promotional efforts in the initial stages and hence few middlemen
may be required.
Market Consideration:- Another important factor influencing the
choice of distribution channel is the nature of the target market.
Some of the important features in this respect are:- If the market
for the product is meant for industrial users, the channel of
distribution will not need any middlemen because they buy the
product in large quantities. short one and may as they buy in a
large quantity. While in the case of the goods meant for domestic
consumers, middlemen may have to be involved. If the number of
prospective customers is small or the market for the product is
geographically located in a limited area, direct selling is more
suitable. While in case of a large number of potential customers,
use of middlemen becomes necessary. If the customers place order
for the product in big lots, direct selling is preferred. But,if
the product is sold in small quantities, middlemen are used to
distribute such products.
Other Considerations:- There are several other factors that an
entrepreneur must take into account while choosing a distribution
channel. Some of these are as follows:- A new business firm may
need to involve one or more middlemen in order to promote its
product, while a well established firm with a good market standing
may sell its product directly to the consumers. A small firm which
cannot invest in setting up its own distribution network has to
depend on middlemen for selling its product. On the other hand, a
large firm can establish its own retail outlets. The distribution
costs of each channel is also an important factor because it
affects the price of the final product. Generally,a less expensive
channel is preferred. But sometimes, a channel which is more
convenient to the customers is preferred even if it is more
expensive. If the demand for the product is high,more number of
channels may be used to profitably distribute the product to
maximum number of customers. But, if the demand is low only a few
channels would be sufficient. The nature and the type of the
middlemen required by the firm and its availability also affects
the choice of the distribution channel. A company prefers a
middlemen who can maximise the volume of sales of their product and
also offers other services like storage, promotion as well as
aftersale services. When the desired type of middlemen are not
available, the manufacturer will have to establish his own
distribution network.All these factors or considerations affecting
the choice of a distribution channel are inter-related and
interdependent. Hence, an entrepreneur must choose the most
efficient and cost effective channel of distribution by taking into
account all these factors as a whole in the light of the prevailing
economic conditions. Such a decision is very important for a
business to sustain long term profitability.
Online channel of distribution:Online channel is the new type of
channel of distribution of goods or services directly to the
customers, without involving any other traditional channel
partners, with the use of internet. It is the direct form of
distribution of goods and services where the roles of
intermediaries are not required and where buyers directly meets the
sellers over internet.it does not requires any physical medium for
doing any business transaction. online distribution of goods and
services is often called as online retailing or E- retailing.
Definition of online channel of distributionThe sale of goods
and services through the Internet. Electronic retailing, or
e-tailing, can include business-to-business and
business-to-consumer sales. E-tailing revenue can come from the
sale of products and services, through subscriptions to website
content, or through advertising.It is a play on the words "retail"
and "e-commerce."Online channels requires businesses to tailor
traditional business models to the rapidly changing face of the
Internet and its users. Online or e-retailing are not restricted
solely to the Internet, and some brick-and-mortar businesses also
operate websites to reach consumers. Online retailing is normally
referred to as e-tailing.
Industry profileThe Automotive industry in India is one of the
largest in the world and one of the fastest growing globally. India
manufactures over 18 million vehicles (including 2 wheeled and
4wheeled) and exports more than 2.3 million every year1. It is the
world's second largest manufacturer of motorcycles; there are eight
key players in the Indian markets that produced 13.8 million units
in 2010-11.At present the dominant products of the automobile
industry are 2 Wheelers with a market share of over 75% and
passenger cars with a market share of about 16%. Commercial
vehicles and three wheelers share about 9% of the market between
them. The industry has attained a turnover of more than USD 35
billion and provides direct and indirect employment to over 13
million people.
The auto industry produced a total 1.81 million vehicles,
including passenger vehicles, commercial vehicles, three wheelers
and two wheelers in February 2014 as against 1.73 million in
February 2013, registering a growth of 4.41 per cent over the same
month last year. The increase continues to be on account of growth
in two wheelers production. Moreover, the overall domestic sales
during AprilFebruary 2014 grew marginally by 2.68 per cent over the
same period last year.The passenger vehicles production in India is
expected to reach 10 million units by 202021. The industry is
estimated to grow at a compound annual growth rate (CAGR) of 13 per
cent during 20122021. In addition, the industry is projected to
touch US$ 30 billion by 202021, according to data from Automotive
Component Manufacturers Association (ACMA).The cumulative foreign
direct investment (FDI) inflows into the Indian automobile industry
during the period April 2000 to January 2014 was recorded at US$
9,344 million, an increase of 4 per cent to the total FDI inflows
in terms of US$, according to data published by Department of
Industrial Policy and Promotion (DIPP), Government of India.The
overall automobile exports grew by 6.39 per cent during
AprilFebruary 2014. Passenger vehicles, three wheelers and two
wheelers registered growth at 6.44 per cent, 16.40 per cent and
5.41 per cent respectively, compared to the same period last
year.
The Indian two-wheeler industry has come a long way since its
humble beginning in 1948when Bajaj Auto started importing and
selling Vespa Scooters in India. Since then, the customer
preferences have changed in favor of motorcycles and gearless
scooters that score higher on technology, fuel economy and
aesthetic appeal, at the expense of metal-bodied geared scooters
and mopeds. These changes in customer preferences have had an
impact on the fortunes of the players. The erstwhile leaders have
either perished or have significantly lost market share, whereas
new leaders have emerged.
With an expanding market and entry of new players over the last
few years, the Indian 2wheeler industry is now approaching a stage
of maturity. Previously, there were only a handful of two-wheeler
models available in the country. Currently, India is the second
largest producer of two-wheelers in the world. It stands next only
to China and Japan in terms of the number of two wheelers produced
and the sales of two-wheelers respectively. There are many
2-wheeler manufacturers in India. The major players in the
2-wheeler industry are Hero Honda, Bajaj Auto Ltd (Bajaj Auto), TVS
Motor Company Ltd (TVS) and Honda Motorcycle & Scooter India,
Private Limited (HMSI) accounting for over 93% of the sale in the
domestic two wheeler market. It is noteworthy that motorbikes
segments share is justbelow 80% of the total 2W market in India
which is dominated by Hero Honda with a market share of 59%.
Scooter segments market share is about 18% which is led by Honda
Motorcycle & Scooter India, Private Limited (HMSI) with a
market share of 43%.Threefourthof the total exports in the two
wheeler automobile industry are made in the motorcycle segment.
Exports are made mainly to South East Asian and SAARC nations.
The level of technology change in the Motor vehicle Industry has
been high but, the rate of change in technology has been medium.
Investment in the technology by the producers has been high.
However, further investment in new technologies will help the
players to be more competitive. Currently, Indias increasing per
capita disposable income which is expected to Rise by 106% by 2015
and growth in exports is playing a major role in the rise
andCompetitiveness of the industry.
EVOLUTION OF THE INDIAN TWO WHEELER INDUSTRYThe 2wheeler
industry (Henceforth 2WI) consist of three segments viz scooters,
motorcycles, and mopeds. The 2WI in India began operations within
the framework of the national industrial policy as espoused by the
Industrial Policy Resolution of 1956. This resolution divided the
entire industrial sector into three groups, of which one contained
industries whose development was the exclusive responsibility of
the State, another included those industries in which both the
State and the private sector could participate and the lastset of
industries that could be developed exclusively under private
initiative within the guidelines and objectives laid out by the
Five Year Plans (CMIE, 1990). Private investment was channelized
and regulated through the extensive use of licensing giving the
State comprehensive control over the direction and pattern of
investment. Entry of firms, capacity expansion, choice of product
and capacity mix and technology, were all effectively controlledby
the State in a bid to prevent the concentration of economic power.
However due to lapses in the system, fresh policies were brought in
at the end of the sixties. These consisted of MRTP of 1969 and FERA
of 1973, which were aimed at regulating monopoly and foreign
investment respectively. Firms that came under the purview of these
Acts were allowed toinvest only in a select set of industries.
In recent years, the Indian two-wheeler (2W) industry has shown
a strong volume growthover the last two-years, having grown by 25%
in 2009-10 and 27% in 2010-11 to reach 13.3 million units. This
strong double-digit growth has been driven by multiple factors. One
reason, of course, is statistical as this period of high
double-digit growth has showed up after a rather sedate previous
two years, when the 2W industry volumes had shrunk by 5% in2007-08
and had grown by a mere 5% in 2008-09. In addition to the
contribution of pent-up demand, the 2W industry growth over the
last two years has been supported strongly by various underlying
factors including Indias rising per capita GDP, increasing rural
demand, growing urbanization, swelling replacement demand,
increasing proportion of cash sales andthe less measurable metric
of improved consumer sentiment.
Information & Credit Rating Agency of India Ltd. (ICRA)
expects the 2W industry to report a volume CAGR of 10-12% over the
next five years to reach a size of ~21-23 million units by 2015-16
as it views the fundamental growth drivers - comprising of expected
steady GDP growth, moderate two wheeler penetration levels,
favorable demographic profile, under developed public transport
system and utility quotient of a 2W - to be intact. Additionally,
the entry of new players in the industry, multitude of new
model/variant launches, growing distribution reach, cheaper
ownership costs on a relative basis areexpected to be some of the
other prime movers for industry growth over the medium term. In
ICRAs view, while the trend in rising commodity prices, hardening
interest rates and increasing fuel costs may lead to some
moderation in industry growth over the short term, the growth over
the medium to long term is expected to remain in double digits.
Growth of Indian 2wheeler industry
Automobile Clusters in India
Zonal spread of automobile manufacturing companies
Ashok Leyland GMBharat ForgeBajaj Auto M&MTata
MotorsFiatEicherNissanTata MotorsSimpson & Co.Hindustan
MotorsInternational Auto ForgingsAshok Leyland ToyotaEnfieldFord
HyundaiBoschTVS Motor VolvoRenaultM&M
Ashok LeylandPiaggioTata MotorsForce MotorsSwaraj MazdaBajaj
AutoMaruti SuzukiAmtek AutoHero Group
Company profilePiaggio vehicles pvt ltd was founded by
RinaldoPiaggio in 1884.Piaggio initially produced locomotives and
railway carriages. During World War I the company focused on
producing aircraft During World War II the company produced bomber
aircraft, but Piaggio emerged from the conflict with
itsPontederaplant completely demolished by Allied bombing. Italy's
crippled economy and the disastrous state of the roads did not
assist in the redevelopment of the automobile markets.Enrico
Piaggio, the son of Piaggio's founder RinaldoPiaggio, decided to
leave the aeronautical field in order to address Italy's urgent
need for a modern and affordable mode of transportation. The idea
was to design an inexpensive vehicle for the masses.Aeronautical
engineerCorradinoD'Ascanio, responsible for the design and
construction of the first modern helicopter byAgusta, was asked by
Enrico Piaggio to create a simple, robust and affordable vehicle.
The vehicle had to be easy to drive for both men and women, be able
to carry a passenger, and not get its driver's clothes dirty. In
1946 Piaggio launched theVespascooter (Italian for "wasp") and
within ten years over a million units had been produced. The
Italian language gained a new word, "vespare", meaning to go
somewhere on a Vespa.
Piaggio& C is today one of the leading manufacturers of
2wheelers and small commercial vehicles in the world. With its
registered office in Pontedera (pisa) Piaggio is the market leader
in Europe and has expanded its operation in 24 countries, including
a major presence in Asian market.
The product range includes scooters, mopeds, and motorcycles
starting from 50 to 1,200cc under the PiaggioVespa, Gilera,
Aprilia, Moto Guzzi, Derbi and scarabeo brands.The 3 and 4-wheeled
light transportation vehicles are marked under the Ape, Porter and
Ouargo brands.
Piaggio Vehicles Private Limited (PVPL), the pioneer of
3-wheeler goods transportation in India, is today the no. 1 in its
class. By setting global standards in vehicle performance and
customer service, it has revolutionized the 3 wheeler cargo segment
in India. Today the company offers a range of passenger and cargo
vehicles for many customized applications.
PVPL is a 100% subsidiary of Piaggio& C. s.p.a. of Italy,
the inventor of 3-wheelers. PVPL commenced its Indian operations in
the year 1999 with the launch of the brand ap which was an instant
success and has grown from strength to strength over the
years.Piaggio vehicles are engineered for higher fuel efficiency,
rugged performance and outstanding load carrying capability. Living
up to Piaggios core philosophy, all its vehicles conform to the
most stringent emission norms.
IN INDIA
In 2wheelers
Piaggio first licensed the production of Vespa scooters in India
toBajaj Autoin the 1960s. In 1971, Piaggio's license was not
renewed as a part of Indira Gandhi's privatization programs. After
the collaboration ended, Bajaj continued to produce scooters based
on the Vespa design, namely theChetak.Another Vespa partner in
India was that ofLML Motors. Beginning as a joint-venture with
Piaggio in 1983, LML, in addition to being a large parts supplier
for Piaggio, produced theP-Series scooters for the Indian market.
In 1999, after protracted dispute with Piaggio, LML bought back
Piaggio's stake in the company and the partnership ceased. LML
continues to produce (and also exports) the P-Series variant known
as theStellain the U.S. market and by other names in different
markets.In the 2012 Auto Expo held in New Delhi, the iconic Vespa
re-entered the Indian Market. Piaggio unveiled its range of
scooters at the Expo. This became the first such venture of Piaggio
in India without a local partner.
In 3-4 wheelers ligth commercial vehiclesPiaggio entered India
in 1998 through a joint venture with Greaves Limited to manufacture
three-wheeler. Piaggio had a majority stake of 51 per cent in this
joint venture. Three years later in August 2001, Piaggio went on to
acquire the 49 percent holding of Greaves Limited and the company,
Piaggio Vehicles Private Limited (PVPL), became a 100 per cent
subsidiary of PiaggioSpA. Since then the company has achieved
phenomenal growth in its revenues - an average growth of more than
40 percent has been realized, year on year. The Indian operations,
ably spearheaded by Ravi Chopra, Chairman and Managing Director,
have today become a key focus area and a significant destination
for the Group's overall business. The company has its
state-of-the-art plant at Baramati (Maharashtra), with a fully
automated conveyor line production facility, computerized paint
shops and advanced R & D facilities. Way back in 1999, the
company had started its production activities with only 40 vehicles
per day. Today it has grown to a scale where it manufactures 500
vehicles in a day. The company has successfully utilized Pune as a
strategic hub for its marketing and 12 sales network, which has
grown to over 240 dealer locations providing 420 outlets for sales
and service across the country. The company employs around 1,200
people in India. It has seven regional offices and fourteen branch
offices all over the country. This is perhaps one of the largest
and best-organized distribution networks for three wheeler in
India. In the last few years, PVPL has emerged as the second
largest three-wheeler manufacturer in India. With an overall market
share of 33 per cent, the company today has maintained its
leadership in the three-wheeler cargo segment with a share of 39
percent. It also has a significant 30 percent share in the
passenger segment. PVPL has also begun to export its ape' vehicles
from India to many countries including Argentina, Peru, Sudan, Sri
Lanka, Mexico, South Africa, Cuba and Bangladesh. Till recently
PVPL's focus was on catering to the increasing domestic market
needs in India, however it now has aggressive plans for a major
thrust on the export front in the coming years. The company expects
10-15 per cent contribution to its turnover from exports in the
future years.
Evoluion of
The inspiration for the design of the Vespa dates back to
Pre-World War IICushmanscooters made inNebraska, USA. These olive
green scooters were in Italy in large numbers, ordered originally
by Washington as field transport for theParatroopsandMarines. The
US military had used them to get aroundNazidefense tactics
ofdestroying roads and bridgesin theDolomites and the Austrian
border areas.Launch of Piaggio filed a patent for the Vespa scooter
design in April 1946. The application documents referred to a
"model of a practical nature" for a "motorcycle with rationally
placed parts and elements with a frame combining with mudguards and
engine-cowling covering all working parts", of which "the whole
constitutes a rational, comfortable motorcycle offering protection
from mud and dust without jeopardizing requirements of appearance
and elegance". The patent was approved the following December.The
first 13 examples appeared in spring 1946, and reveal their
aeronautical background. In the first examples, one can recognize
the typical aircraft technology. Attention to aerodynamics is
evident in all the design, in particular on the tail. It was also
one of the first vehicles to use monocoque construction (where the
body is an integral part of the chassis).The company was aiming to
manufacture the new Vespa in large numbers, and their longstanding
industrial experience led to an efficientFord-stylevolume
production line. The scooter was presented to the press at Rome
Golf Club, where journalists were apparently mystified by the
strange, pastel coloured, toy-like object on display. But the road
tests were encouraging, and even with no rear suspension the
machine was more manoeuvrable and comfortable to ride than a
traditional motorcycle.Following its public debut at the 1946 Milan
Fair, the first fifty sold slowlythen with the introduction of
payment by installments, sales took off.Sales & Development of
The biggest sales promo ever was Hollywood. In 1952,Audrey
Hepburnside-saddledGregory Peck's Vespa in the feature filmRoman
Holidayfor a ride through Rome, resulting in over 100,000 sales. In
1956,John Waynedismounted his horse in favor of the two-wheeler to
originally get between takes on sets.[7]as well asMarlon
Brando,Dean Martin, and the entertainerAbbe Lanehad become Vespa
owners. WilliamfilmedBen Hurin Rome in 1959, allowingCharlton
Hestonto abandon horse and chariot between takes to take a spin on
the Vespa.Vespa clubs popped up throughout Europe, and by 1952,
worldwide Vespa Club membership had surpassed 50,000. By the
mid-1950s, Vespas were being manufactured under licence in Germany,
the United Kingdom, France, Belgium and Spain; in the 1960s,
production was started in India, Brazil and Indonesia. By 1956, one
million had been sold, then two million by 1960. By the 1960s, the
Vespaoriginally conceived as a utility vehiclehad come to symbolize
freedom and imagination, and resulted in further sales boosts: four
million by 1970, and ten million by the late 1980s.In recent years
vespa has emerged not only as a market leader but also as a youth
icon for scooters, with its continious touch with hollywood and
bollywood movies vespa has been always maintained itself in
headlines, which results in a strong brand value even at the time
of recession when piaggio C faced severe falls in sales even the
company has come to the stage of bankcroupcy. Piaggio started its
earning aftre recession again from vespa, it launches various
models of vespa which turned in a huge success for the company.
Research Methodology
Research Methodology
Meaning of Research: Research is the investigation of a
particular topic using a variety of reliable, scholarly resources.
The three major goals of research are establishing facts, analyzing
information, and reaching new conclusions. The three main acts of
doing research are searching for, reviewing, and evaluating
information.
Definition of Research:
The Advanced Learners Dictionary of Current English lays down
the meaning of research as- a careful investigation or inquiry
specially through search for new facts in any branch of knowledge.
The study requires both, Primary and Secondary data for
research.Research
Secondary researchPrimary research
Primary Data:
Data that has been collected from first-hand-experience is known
as primary data. Primary data has not been published yet and is
more reliable, authentic and objective. Primary data has not been
changed or altered by human beings; therefore its validity is
greater than secondary data.
Types of primary data used: Questionnaire Personal Interview
Indirect Observation
Secondary Data: Data collected from a source that has already
been published in any form is called as secondary data. The review
of literature in any research is based on secondary data, mostly
from books, journals and periodicals.Types of Secondary data used:
Journal Newspaper Internet Web Portals
Data Analysis Tool: Bar Chart Pie ChartData Analysis Technique:
Quantitative Descriptive Questionnaire Sample size 120 (Customers
& Clients) Sampling
Objectives
Main objective: To study and analyse scope of online channel for
selling two wheelers.
Secondary Objective: To determine the demographic /psychographic
profile of online buyers To understand customer buying behaviour.
To analyse the product category that respondents buy online. To
understand the factors affecting online buying behaviour. To
analyse customer preference for online purchase of two
wheelers.
Scope of project: Increase market reach. Engaged with
merchandise business through online channel. Suitability of more
efficient distribution channel e.g online
Data analysis & Interpretation
1. No. of respondents.
GenderNo. of respondentsPercentage
Male8772.5%
Female3327.5%
Total120100%
Interpretation:-Total number of respondent are 120, in which 87
are male and 33 are female.
2. Age group of respondents.
Age group (Years)No. of respondentsPercentage
00
Total120100%
Interpretation:-Majority of respondents lies in group of 21-30
year i.e 54% of total respondents and 44% of respondent lies in age
group of 31-40. Only 2% lies in age group 41-50 age group. Hence
from this data we can easily identify that maximum number of
respondents lies in age group of 21-40 and as our product is more
appropriate for this age group.
3. Income level of respondents.
Income level (in Lakhs)No. of respondentsPercentage
Below 1.254.17
1.2 -2.53327.5
2.5 4.05949.17
4.0 6.01915.83
6.0 & above43.33
Total120100
Interpretation:- Majority of respondent falls in 2.5-4.0 Lakhs
income level i.e approx. 50% of total number of respondent only
3.33% respondent are having income above 6 lakhs.
4. Qualification of respondents.
Educational levelNo. of respondentsPercentage
School00
Under Graduate3730.83
Post Graduate8369.17
Ph.D00
Total120100
Interpretation:-As most of our respondent belongs to corporate
so majority of them were having post graduate degree.
5. Occupation of respondents.
OccupationNo. of respondentsPercentage
Student1613.33
Salaried6554.17
Business Man2722.5
Doctors/ Lawyers1210
Others00
Total120100
Interpretation:-54% of our respondent were employed and around
14% of respondents were student.
6. Do you or someone in your household have 2 wheeler?
ResponseNo. of respondentsPercentage
Yes120100 %
No00
Total120100 %
Interpretation:- All of our respondent having two wheeler in
their household.
7. Are you the decision maker in your family.
ResponseNo. of respondentsPercentage
Yes8570.83
No3529.17
Total120100
Interpretation:-71% of our respondent were decision maker in
their family. As majority of our respondent were employed, hence
they are decision maker.
8. Have you ever experienced online shopping?
ResponseNo. of respondentsPercentage
Yes10385.83
No1714.17
Total120100
Interpretation:-Approx. 86% respondents have experience online
shopping. As online shopping becomes common trend now days. Rest of
respondents have not personally experience online shopping but
someone from their household does online shopping.
9. Which of the following products category you buy
online?CategoryNo. of respondentsPercentage
Books & Music C./D.V.D4811.62
Clothing6415.50
Fashion accessories348.23
Consumer durables6615.98
Consumer goods286.78
Utility payments6716.22
Automotive30.73
Travel/Hotel booking7818.89
Others256.05
Total413100
Interpretation:-Most of our respondents have experiences online
shopping in Travel, hotel booking, Utility payments, consumer
durables etc. Only 0.78% i.e 3/120 respondents purchased two
wheeler online.
Interpretation:-41.16% of our respondent have experienced online
shopping in service sector. In which 46% respondents fall in travel
& hotel booking. 39% falls in utility payments. Rest of all
falls in others categorye.g foods, second hand automobiles and
goods.
Interpretation:- 51.84% of our respondent have experienced
online shopping by purchasing goods. Out of which 27% falls in
consumer durables, 26% falls in clothing , 20% falls in books &
music, cds. Only 0.78% falls in automotive.
10. How frequently do you shop online in a month?
OptionNo. of respondentsPercentage
Once4235
2 3 times2520.83
3 5 times119.17
More than 54235
Total120100
Interpretation:-35% of respondents have experience only shopping
at least once in a month. And again 35% of respondents have
experience it more than 5 times in a month. Rest all have
experience 2 -5 times in a month.
11. Which mode of payment do you prefer most?ParameterNo. of
respondentsPercentage
Online payment5646.67
Cash on delivery4235
Using EMI option2016.67
Others21.66
Total120100
Interpretation:-Around 47% of respondent have preferred online
payment and 35% preferred cash on delivery.
12. Why do you consider online shopping? (Rate the
following)ParametersResponse
Very importantModerately importantNeither important nor
unimportantSlightly importantLeast importantTotal
Home Delivery
9811407120
Discounts Schemes523219125120
Compare price between products463020240120
Variety of products3636142014120
Save time592129110120
Easy Return policy542422020120
Total120120120120120
Interpretation:- As people now days are busy with their day 2
day activity so majority of our respondents preferred home delivery
as most important factor for doing online shopping so they dont
need to spend time for shopping.
Interpretation:- After home deliver most of the respondents
prefer online shopping for discount schemes offered.43% respondents
said discount schemes is very important, 27% said discount schemes
is moderately important. So overall discount factor is important
for online shopping in respondents.
Interpretation:-38% respondents shop online because they will
compare price while he buying online between sites. Only 17%
respondent responds the compare price is neither important nor
unimportant.
Interpretation:- variety of product is as much important factor
like others. In home respondents see variety of products through
online websites and place order for the same.34% respondents
responds variety of products as very important factor and
moderately important factor.
Interpretation:-Save time 49% respondents respond very important
factor as it save lot of time. But 24% respondents responds neither
important nor unimportant factor.
Interpretation:- Apart from home deliver and discount schemes
manly our respondents preferred online shopping for reasons like:
compare price, easy return police. Respondents said easy return
policy is very important while shopping online.
13. What is your approximate monthly expenditure on online
shopping?
OptionNo. of respondentsPercentage
Less than Rs. 10003025%
Rs. 1000 Rs. 5000 3932.5%
Rs. 5000 Rs.150003428.33%
More than Rs. 150001714.17
Total120100%
Interpretation:-Majority of respondents spend money Rs.1000-5000
in a month i.e 32.5%. 25% respondent less than 1000 and 14%
respondents are more than Rs5000 spends on an average in a
month.
14. Please rate the following Parameters based on your
experience of online
shopping?ParametersSatisfiedNeutralDis-satisfiedNot respond
Safety68457
Timely delivery62499
Variety69492
Customer service365529
Easy accessibility545754
Overall595821
Interpretation:-57% respondents satisfied with online buying
safety issue. Earlier people worried about safety issue when they
buy online. But now scenario is changed respondents. Only 6%
respondents dissatisfied with safety issues.
Interpretation:- Most of respondents responds timely delivery of
their respective product is satisfied.
Interpretation:-57% respondents satisfied as their respective
variety of product. Rather a 41% respondent does not bother much as
variety of product.
Interpretation:-30% respondents satisfied with customer service
as per their respective products. 46% respondents responds neutral.
24% respondents dissatisfied with their respective customer service
while buying online.
Interpretation:-45% respondents satisfied with easy
accessibility factor of their respective product while majority of
respondents responds natural. 3% of respondents not respond with
any of factor.
Interpretation:-Majority of respondents i.e 49% satisfied with
their online buying experience. 48% respondents responds neutral. 2
% respondents are dissatisfied. 1% respondents. 1% respondents not
respond any of factor.
15. Name Top 3 E-retailer you prefer?
NameRespondentPercentage
Flipkart7420.85%
Amazon3610.14%
E-bay4512.68%
Shop clues143.94%
Jabong185.07%
Snapdeal5014.08%
Myntra205.63%
Irctc4111.55%
Yebhi185.07%
Others3910.99%
Total355100%
Interpretation:-It was found that while shop online 21%
respondents buying from flip kart website. 14% respondents buy from
Snapdeal. 13% respondents buy from e-bay. Flip-kart, Snapdeal,
E-bay more or less these three deals with same product category.
IRCTC and Others have 11% respondents respond. Others include
payment gateway websites, official websites and foods.
16. Would you consider buying a two wheeler online?
ParameterRespondentPercentage
Yes76%
May be3227%
No8167%
Interpretation:-Only 6% respondents responds they will consider
buying two wheeler online.27% respondents responds maybe they will
be or they will not be consider buying a two wheeler
online.Majority of respondents responds they will not be consider
buying a two wheeler i.e 67%.
17. If no, Why?Rate 1 to 5 ( 1 is good)
Parameter Most Important Moderately ImportantNeither Important
nor Unimportant Slightly ImportantLeast ImportantNot Respond
Unavailability of test ride through online822170010
Online buying safety issues33262602510
Concerned about service44302016010
Product quality28491716010
Documentation issues4243241010
Interpretation:-It was find that 68% respondents usually not
consider buying two wheeler online is because unavailability of
test ride through online buying. 18% respondents said its
moderately important.
Interpretation:-Safety issues always be a problem while buying
product through online. 27% respondents said why they will not
buying two wheeler online because of safety issue.
Interpretation:-Majority of respondents concerned about service
who will provide the service when they buying two wheeler online.
So 37% respondents said it is most important factor.25% said it is
moderately important factor.
Interpretation:- It was find that majority of respondents i.e
41% respondents said it was moderately important.23% respondents
said product quality is most important factor.
Interpretation:-Documentation issues is factor for any
automobile dealer or user.So in case of online respondents said it
is most important factor. 35% respondents said it is most important
factor. 36%respondents said it is moderately important.
18. Would you consider buying two wheeler online, if a company
provides you following benefits?ParametersYesMay beNoNot
Respond
Attractive discounts2477712
Freebies13603512
Free extended warranty30631512
Additional payment option13315323
Road side assistance68301012
All of above17801211
Interpretation:-It was find that majority of respondents i.e 71%
responds that if they will get attractive discount they will
consider buying two wheeler online. 22% respondents responds yes
they will consider buying two wheeler online, if they will get
attractive discount.
Interpretation:- It was find that respondents didnt bother much
about freebies. Only 12% respondents said yes they will consider
buying two wheeler online. While 55% respondents responds may be
and 32% respondents respond as no, they will not consider buying
two wheeler online. 1% respondents didnt respond any of following
option.
Interpretation:-58% respondents responds if they get free
extended warranty they will consider buying two wheeler online. 27%
said yes and 14 % respondents respond no they will not consider
buying two wheeler online.
Interpretation:- 26% said they will consider if they will get
additional payment option like cash credit basis, after
documentation clear, etc. 44% respondents respond chose a option as
may be.
Interpretation:- 57% respondents respond yes if they will get
road side assistance while buying online two wheeler. 25 % said may
be and 10% respondents doesnt respond any option.
Interpretation:-14% respondents said yes they will consider
buying two wheeler online. 66%respondents respond may be and 10%
respondents doesnt responds any option.
19. Would you prefer to buy two wheeler online, if company
provides you following services?ParametersYesMaybeNoNot Respond
Authorized Service Centers5944314
Test ride at home6538314
High degree of customization60361014
All of above30361044
Interpretation:-49% respondents respond if company provide
authorized service centre they will prefer buying two wheeler
online. 37% respondents respond may be as option 12% doesnt
responds any option.
Interpretation:- 54% respondents said if they will get test ride
at their door step they will prefer buying two wheeler online. 32 %
said it may or may not be buy two wheeler.
Interpretation:- 50% respondents said if they get customization
option while buying online they will prefer buying two wheeler
online. 30% respondents doesnt require any customization so they
choice may be as a option.
Interpretation:-Overall only 33% respondents said yes they will
prefer online buying two wheeler. 40% respondents said may be. 11%
respondents said no they will not prefer buying two wheeler online
and 16% respondents didnt choose any option.
15. What customization option would you like to
have?ParametersYesMaybeNoNot Respond
Engine power (cc)5737188
Color803028
Brake type6723219
Tyre type4944198
Special graphics931548
Interpretation:- In customization option while buying two
wheeler online 45% respondents choose engine cc as a preference
option.
Interpretation:- 63% respondents respond colour as preferable
customize option.
Interpretation:-It was find that if respondents will get brake
type option like Front disk rear drum Both disk Both drum54%
respondents respond they will prefer buying two wheeler online. 18%
respondents choose option as may be and 17% respondents respond
they will not prefer buying two wheeler online.
Interpretation:-It was find that if respondents will get tyre
type like Tube tyre Tube less tyre39% respondents said yes they
will prefer buying two wheeler online if they get tyre type option
while buying online.
Interpretation:-74% respondents said yes if they will get
special graphics option they will prefer two wheeler online
Limitations
Framing questionnaire Lack of interest of respondents The issues
considered confidential by the authorities were not revealed
because of which access to several data and information was not
gained, which would be useful for the betterment of the project.
Time constraint was one of the major limitation. As the summer
internship period was only one month, the project did not match
with the promotional schemes and offers of the stores under study.
Sample size was small as it consists of 120 respondents.
Finding & Observation
Finding & Observation
Very few respondents were interested to buy a 2 wheeler online.
There is a very vast scope to sell 2wheelers online as there are
only 2 players in this segment of 2 wheeler markets, and Vespa can
use its brand name very effectively. Most of the respondents were
working and falls under age group of 20 -30 years and they are
frequent online buyers. Majority of respondents were buying
clothing, Fmcd, and doing utility payments through online. Most of
the respondents are not the decision makers of their family.
Suggestions&Recommendations
Suggestions & Recommendations
Company needs more publicity about its new way of selling 2
wheelers online as we have found most of our respondents have done
online shopping either for travel ticket/hotel booking, in
purchasing household products, books, clothing etc. Only 0.7% of
respondents have really experienced the purchase of automobiles.
Company need to create advertisement on websites like olx.com as
they are already in the business of selling 2 wheelers online
though they deals in used automobiles but still people will come to
about Piaggio new method of selling 2 wheeler online. As we have
seen most of the respondents were not interested in purchasing 2
wheeler online but still around 20 respondents have agreed that
they will consider buying the 2 wheeler online. If company will
provide facilities like customization, extended warranties,
customer support, and other value added services the those
customers who are in dilemma whether to purchase a 2 wheeler online
or not can be converted into a hot customer. If company could make
it easier to resolve RTO clearance issues quickly and easier
payment options then many customers can easily purchase a 2 wheeler
online as we found many of our respondents were not preferring
online purchase of a 2 wheeler just because of documentation and
payment related issues. Company must need to ensure that a customer
should get test drive even at the doors of the customers as it will
make them realise that they are getting maximum delight after
spending such a big amount.
Conclusion
Conclusion
After meeting 120 respondents and many retailers we found that
Piaggio has a very good image in 2 wheeler segment and there is an
immense opportunity to sell 2 wheelers online as it is a very new
concept and only 2 or 3 players are there in this segment and hence
Piaggio can use its popularity or its brand name which it has
earned by its product like Piaggio ape, Apprilla etc.As the cost of
Vespa is a bit high as compared to other scooters brand so Piaggio
need to reduce its cost and it can be easily done by eliminating
channel partners and the best way of doing it is to sell 2 wheelers
online.While conducting research we have found many respondents
were excited to know that Piaggio is going to sell its 2 wheeler
online, so we conclude that with huge promotion on internet the
company can enter into e- business of selling a 2 wheeler.
Bibliography
Bibliography
www.ibef.org www.pvpl.com www.vespa.in Book published on Piaggio
Vespa.
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