final vaibhav anand

Report On

The analysis of the consumer buying behaviour for

Economy segment motorcycles in domestic market.

(TVS Motor Company Limited)

Bangalore

Prepared by

Vaibhav Anand

Registration no:

10SBCM0117

The Project was completed under the Guidance of Prof Sunil. D. Anto

In partial fulfilment of the Course-Industry Internship Programme (IIP) in

Semester II of the Post Graduate Programme in Management.

(Batch: Aug. 2010 – 2012)

Industry Internship Report 2011

Master of Business Administration

Industry Internship Programme (IIP)

Declaration

This is to declare that the Report entitled Analysis of consumer buying behaviour for

economy segment motorcycles in the domestic market has been made for the partial

fulfillment of the Course: Industry Internship Programme (IIP) in Semester II

(Batch: August 2010-12) by me at TVS motor company limited under the guidance of

Prof Prasanna Mohan Raj.

I confirm that this Report truly represents my work undertaken as a part of my Industry

Internship Program (IIP). This work is not a replication of work done previously by any other

person. I also confirm that the contents of the report and the views contained therein have

been discussed and deliberated with the Faculty Guide.

Signature of the Student :

Name of the Student : VAIBHAV ANAND

Registration No : 10SBCM0117


Master of Business Administration

Certificate

This is to certify that Mr. Vaibhav Anand, Registration No. 10SBCM0117 has completed

the Report entitled Analysis of consumer buying behaviour for economy segment

motorcycles in the domestic market. Under my guidance for the partial fulfillment of the

Course: : Industry Internship Programme (IIP) in Semester II of the Master of Business

Administration (Batch: Aug. 2010 – 2012).

Signature of Faculty Guide :

Name of the Faculty Guide : Prof Prasanna Mohan Raj


ACKNOWLEDGEMENT

First and foremost, I would like to thank my Faculty Guide, Prof Prasanna Mohan Raj for

him closely monitoring my work and giving me continuous feedback ensuring that the work I

did was relevant to the market as well in keeping with the academic requirements.

I would also like to thank my Industrial Guides, Mr. Shyam Mrithyunjayan and Mr.Vikas

Sikka for giving me the opportunity to work at TVS Motor Company Limited marketing unit.

They were flexible in allowing me do work that was useful for the company while at the

same time was in alignment to the college needs.

My thanks to all other faculties, seniors and batch mates of Alliance who have been of

immense help and have always been ready to help me irrespective of their other

commitments.

Vaibhav Anand


Table of Contents

1. EXECUTIVE SUMMARY..............................................................................................72 INTRODUCTION............................................................................................................9

2.1 INDUSTRY OVERVIEW..............................................................................................11

2.1.1 INDIAN AUTOMOBILE INDUSTRY: AN INTRODUCTION.....................................11

2.1.2 Indian Two-Wheeler Industry: A Perspective...................................................13

2.1.3 Evolution of Two-wheeler Industry in India......................................................14

2.1.4 Benefits of Two-Wheelers................................................................................15

2.1.5 A Growth Perspective.......................................................................................16

2.1.6 Two-wheelers: Market Size..............................................................................20

2.1.7 Demand Drivers................................................................................................21

2.1.8 Rise in GDP per Capita has increased affordability of Two Wheelers...............22

2.1.9 TWO WHEELER: CATEGORIES AND SEGEMENTS..............................................25

2.2 MAJOR PLAYERS.......................................................................................................31

2.2.1................................................................................................................................ 31

2.2.2................................................................................................................................ 32

2.2.3................................................................................................................................ 33

2.2.4 MARKET SHARE.................................................................................................35

2.3 PEST ANALYSIS ON TWO-WHEELER INDUSTRY:.......................................................36

2.4 PORTER’S 5 FORCES ANALYSIS.................................................................................37

2.5 COMPANY PROFILE..................................................................................................40

2.5.1 History..............................................................................................................40

2.5.2 The Legacy of TV Sundaram Iyengar.................................................................40

2.5.3 The Early Years.................................................................................................41

2.5.4 The TVS Suzuki Relationship.............................................................................41

2.5.5 Rise to Present Prominence..............................................................................41

2.5.6................................................................................................................................ 41


2.5.7 Awards..............................................................................................................42

2.6 TVS Motor Company – Mission & Vision..................................................................42

2.6.1 TVS Motor Company - Mission.........................................................................42

2.6.2 Vision Statement..............................................................................................42

2.7 MOTORCYCLE MODELS............................................................................................44

2.8 SWOT ANALYSIS OF TVS MOTOR COMPANY LIMITED.............................................45

3 PROJECT PROFILE.....................................................................................................463.1 OBJECTIVES OF THE STUDY......................................................................................46

3.2 RESEARCH METHODOLOGY.....................................................................................47

3.2.1 Data Source:.....................................................................................................48

3.2.2 Sample Size:......................................................................................................48

3.2.3 Research Methodology Adopted:.....................................................................48

3.2.4 Data Collection:................................................................................................48

3.2.5 Sampling Profile:...............................................................................................48

3.2.6 Sampling Method:...........................................................................................48

3.3 Limitations of the Study...........................................................................................49

3.4 Tools Used To Conduct The Research......................................................................49

4 OBSERVATIONS AND ANALYSIS............................................................................514.1 Project Implementation and Observation................................................................51

4.1.1 UNDERSTANDING THE NEED............................................................................51

4.1.2 THE REASON FOR RESEARCH............................................................................51

4.1.3 BUYING BEHAVIOUR.........................................................................................52

4.2 FACTORS AFFECTING CONSUMER BUYING BEHAVIOUR..........................................52

4.3 Data Analysis on the basis of the survey( Open & Close Ended)..............................53

5 FINDINGS.......................................................................................................................966 RECOMMENDATIONS..............................................................................................1017 CONCLUSION.............................................................................................................1038 LEARNING OUTCOME.............................................................................................1049 BIBLIOGRAPHY.........................................................................................................105


10 ANNEXURE..............................................................................................................106

1. EXECUTIVE SUMMARY

The feeling of freedom and being one with the Nature comes only from riding a two

wheeler. Indians prefer the two wheelers because of their small manageable size, low

maintenance and pricing and easy loan repayments. Indian streets are full of people of all

age groups riding a two wheeler. Motorized two wheelers are seen as a symbol of status by

the populace. Thus, in India, we would see swanky four wheels jostling with our ever

reliable and sturdy steed: the two wheeler.

The trend of owning two-wheelers is due to a variety of facts peculiar to India. One of the

chief factors is poor public transport in many parts of India. Additionally, two-wheelers offer

a great deal of convenience and mobility for the Indian family.

India is the second largest producer and manufacturer of two-wheelers in the world. It

stands next only to Japan and China in terms of the number of two-wheelers produced and

domestic sales respectively. Indian two-wheeler industry has got spectacular growth in the

last few years. Indian two-wheeler industry had a small beginning in the early 50's. The

Automobile Products of India (API) started manufacturing scooters in the country. Bikes are

a major segment of Indian two wheeler industry, the other two being scooters and mopeds.

Indian companies are among the largest two-wheeler manufacturers in the world. The

change in the government's policy owning to pollution control norms and the Kyoto

agreement saw the phasing out of two stroke two-wheelers from production. Currently

there are around 10 two-wheeler manufacturers in the country, they being Bajaj, Hero,

Hero Honda, Honda, Indus, Kinetic, Royal Enfield, Suzuki, TVS, and Yamaha.

The study tries to find out the factors - affecting the purchasing behaviour of consumers. It

also tries to find out the market penetration level of these brands in urban and rural market.

The research reveals various facts regarding consumer perception about various economy


segment motorcycle brands. The study also evaluates the impact of various attributes such

as price, mileage, looks and style etc for brand success. This report is prepared to

communicate about the consumer perception towards the economy segment motorcycles

broadly in Bangalore, India. This report states various factors on which consumers make a

purchase decision. Factor analysis attempts to identify major attributes which are critical in

initiating a purchase decision as well as for companies to keep in mind certain factors which

consumers expect.


2 INTRODUCTION

My internship started on 25/April/2011 and I was given the research topic as Study of the

consumer buying behavior for the economy segment motorcycles in the domestic market.

I was expected to draft a questionnaire which is the base and the most important part of my

internship project. Therefore, I Prepared a Questionnaire keeping into consideration the

Primary Objective i.e. To Understand the Consumer Buying Behaviour for economy segment

motorcycles.

Under the esteemed guidance of the industry guide Mr. P.V. Shyam Mrithyunjayan and Mr.

Vikas Sikka chalked down an action plan to go about the project with exploratory research

first. The next plan of action was to deploy me under various dealers of TVS in Bangalore so

that I can carry out the survey and get the questionnaire filled.

I Carried an Exploratory Survey on the basis of convenient sampling at two designated TVS

showrooms i.e. Tristar Auto, Domalur and Meghdoot Auto, M.G. Road. Followed by random

sampling at Cambridge layout and Anekal. The Survey was conducted keeping the Target

Group (TG) in mind i.e. consumers who already own a motorcycle and also the consumers

who are intending to own one. An absolute mix of 60 responses was recorded and

administered under the guidance of the industry guides.

Eventually, after the analysis of the exploratory research, a crisp close-ended questionnaire

was drafted which was surveyed in Anekal , Attibele,Jagadish nagar, Beml

Gate,Bomnahalli,Chandapur,Kargdaspura,Ejipura,G.M Pallya and Koramangla to collect data

from 200 respondents and a draft copy of the Questionnaire was put on Facebook and

Orkut to get more reviews from the customers. The data accounting was then done on

Microsoft excel which is supposedly the first leg of research methodology. Many errors

occurred due to statistical lag which was encountered which converting the data into a

binary format from the hard copy to the excel sheets. However, after thorough re-checks,

the problems occurred were encountered and taken care off.


The study helped me to learn how consumers help firms and organizations improve their

marketing strategies by understanding issues such as

The psychology of how consumers think, feels, reason, and select between different

alternatives (example brands, products, and retailers).

The psychology of how the consumer is influenced by his or her environment (example

culture, family, signs, media).

The behaviour of consumers while shopping or making other marketing decisions.

And lastly how marketers can adapt and improve their marketing campaigns and marketing

strategies to more effectively reach the consumer.


2.1 INDUSTRY OVERVIEW

2.1.1 INDIAN AUTOMOBILE INDUSTRY: AN INTRODUCTION

With five thousand years of history behind it, a five decade young nation and the largest

democracy in the world, India today has the second largest volume of human resource in

the world. It has no more than 2.5 per cent of global land but is the home of one sixth of the

world's population of more than 1.1 billion. India possesses one of the richest reserves of

biodiversity, minerals and metals, soils and water, flora and fauna in this part of the globe

and has climatic conditions suitable for round the year economic activity in any part of the

nation. More than five decades of sustained and planned developmental INITIATIVE IN India

has fielded substantive results on social and economic fronts. Assisted by a comprehensive

performs programmed since early 1990s, GDP growth in the post perform period has

improved from an average of about 5.7 per cent in the 1980s to an average of 6.1per cent in

the last decade, making India one of the fastest growing developing countries. Indeed, in the

current year, India is amongst five fastest growing economies of the world. In terms of

purchasing power parity (PPP), India is world's fourth largest economy. The incidence of

poverty has continued to decline and population growth has also decelerated below 2 per

cent for the first time in four decades. However, like the rest of the world, last two years of

general economic slowdown has adversely affected India also. However, the strong

fundamentals of the Indian economy have not permitted pace of growth to decelerate

much. In India, as in many other countries, the auto industry is one of the largest industries.

It is one of the key sectors of the economy. The industry comprises of automobile and the

auto component sectors and encompasses commercial vehicles, multi utility vehicles,

passenger cars, two wheelers, three wheelers, tractors and related auto components. The

industry has shown great advances since de-licensing and opening up of the sector to

Foreign Direct Investment (FDI) in 1993. It has deep forward and backward linkages with the


rest of the economy, and hence, has a strong multiplier effect. This results in the auto

industry being the driver of economic growth and India is keen to use it as a lever of

accelerated growth in the country.

In India, since the early 1940s when the auto industry rolled out first passenger car, its

significance in the economy has progressively increased. However, from its early days until

the mid-1980s for two-wheelers and LCVs and until the early 1990s for passenger cars, the

focus of development of the automotive industry has been on import substitution. The

current low penetration levels in India in all three segments of the industry, namely

commercial vehicles, passenger cars and two wheelers and under-exploitation of the

potential of this industry to foster the growth of the economy have resulted in the auto

industry contributing a relatively low (nearly 5 per cent) share of industrial output in India

compared to the 8-10 percent range in other developing countries and around 15 per cent

in mature economies.

During last decade, conscious efforts have been made to find-tune state policy perspective

in a manner that this industry realizes its full potential in the economy. With this, the

industry has shown great advances since abolition of licensing in 1991 and automatic

approval permitted up to 51 per cent foreign investment in priority sectors that included the

automotive industry, except passenger car manufacture. Motor car manufacture was freed

from licensing in April 1993. Public policy dispensation requiring new joint venture car

manufactures to commit certain levels of phased indigenization, minimum investments in

manufacturing facilities, neutralization of foreign exchange on imports with the exports of

cars and components, etc. was withdrawn in September 2001 as a major initiative to bring

policy framework in step with WTO requirements. The quantitative restrictions on imports

were removed with effect from 1st April 2001.

Thus Industrial licensing and foreign investment regime in the country has been

progressively liberalized. The freeing of the industry from restrictive environment has on the

one hand helped it to restructure, absorb new technologies, align itself to the global

developments and realize its potential; on the other hand, this has significantly increased

industry's contribution to overall industrial growth in the country.


There are at present 13 manufacturers of passenger cars and multi utility vehicles, 7

manufacturers of commercial vehicles, 11 of 2 or 3-wheelers and 10 of tractors besides 4

manufacturers of engines. The industry has an investment of a sum ex ceding US$ 10 billion.

During 1999-2000 the turnover of the automotive industry as a whole was US$ 12.5 Billion

approximately. The industry employees 5,00,000 people directly and more than 10 million

people indirectly and is now inhabited by global majors in keen competition. The arrival of

most international automotive giants in India has set the stage for an exponential growth in

the component industry's levels of technology, quality and competitiveness. At the same

time, the arrival of new and contemporary models has stimulated demand for vehicles in

the market. The auto industry has achieved a cumulative annual growth rate (CAGR) of 22

per cent 1992-1997 (or approx. 13 to 14 per cent in real terms) outstripping industries

production growth by about 30 per cent. This has led to an increase in its contribution to

industrial output from 4.3 per cent in 1992-1993 to 5.4 per cent by 1996-1997.The

component industry in the same period has grown by a CAGR of 28 percent. With this the

contribution of automobile industry to the GDP has risen from 2.7 per cent of GDP in 1992 -

1993 to 4.5 per cent by 1996-1997. However, with a worldwide economic slowdown, auto

industry's growth pattern has shown a downward trend in last two years.

2.1.2 Indian Two-Wheeler Industry: A Perspective


Figure 1: Indian 2W Industry snapshot

Automobile is one of the largest industries in global market. Being the leader in product and

process technologies in the manufacturing sector, it has been recognised as one of the

drivers of economic growth. During the last decade, well¬-directed efforts have been made

to provide a new look to the automobile policy for realising the sector's full potential for the

economy. Steps like abolition of licensing, removal of quantitative restrictions and initiatives

to bring the policy framework in consonance with WTO requirements have set the industry

in a progressive track. Removal of the restrictive environment has helped restructuring, and

enabled industry to absorb new technologies, aligning itself with the global development

and also to realise its potential in the country. The liberalisation policies have led to

continuous increase in competition which has ultimately resulted in modernisation in line

with the global standards as well as in substantial cut in prices. Aggressive marketing by the

auto finance companies have also played a significant role in boosting automobile demand,

especially from the population in the middle income group.

2.1.3 Evolution of Two-wheeler Industry in India

Two-wheeler segment is one of the most important components of the automobile sector

that has undergone significant changes due to shift in policy environment. The two-wheeler

industry has been in existence in the country since 1955. It consists of three segments viz.


scooters, motorcycles and mopeds. According to the figures published by SIAM, the share of

two-wheelers in automobile sector in terms of units sold was about 80 per cent during

2003-¬04. This high figure itself is suggestive of the importance of the sector. In the initial

years, entry of firms, capacity expansion, choice of products including capacity mix and

technology, all critical areas of functioning of an industry, were effectively controlled by the

State machinery. The lapses in the system had invited fresh policy options that came into

being in late sixties. Amongst these policies, Monopolies and Restrictive Trade Practices

(MRTP) and Foreign Exchange Regulation Act (FERA) were aimed at regulating monopoly

and foreign investment respectively. This controlling mechanism over the industry resulted

in: (a) several firms operating below minimum scale of efficiency; (b) under-utilisation of

capacity; and (c) usage of outdated technology. Recognition of the damaging effects of

licensing and fettering policies led to initiation of reforms, which ultimately took a more

prominent shape with the introduction of the New Economic Policy (NEP) in 1985.

However, the major set of reforms was launched in the year 1991 in response to the major

macroeconomic crisis faced by the economy. The industrial policies shifted from a regime of

regulation and tight control to a more liberalised and competitive era. Two major results of

policy changes during these years in two-wheeler industry were that the, weaker players

died out giving way to the new entrants and superior products and a sizeable increase in

number of brands entered the market that compelled the firms to compete on the basis of

product attributes. Finally, the two-¬wheeler industry in the country has been able to

witness a proliferation of brands with introduction of new technology as well as increase in

number of players. However, with various policy measures undertaken in order to increase

the competition, though the degree of concentration has been lessened over time,

deregulation of the industry has not really resulted in higher level of competition.

India is the second largest producer of two-wheelers in the world. In the last few years, the

Indian two-wheeler industry has seen a spectacular growth. The country stands tall next to

China and Japan in terms of production and sales respectively. Majority of Indians, especially

the youngsters prefer motorbikes rather than cars. Capturing a large share in two-wheeler

industry, bikes and scooters cover a major segment. Bikes are considered to be favourite

among the youth generation, as they help in easy communication. Large varieties of two-


wheelers are available in the market, known for their latest technology and enhanced

mileage, Indian bikes, scooters and mopeds represent style and class for both men and

women in India.

2.1.4 Benefits of Two-Wheelers

Two-wheelers are the most popular and highly sought out medium of transport in India. The

trend of owning a two-wheeler is due to its:

Economical Price

Safety

Fuel Efficiency

Comfort level

However, few Indian bike enthusiasts prefer high performance imported bikes. Some of the

most popular high-speed bikes are Suzuki Hayabusa, Kawasaki Ninja, Suzuki Zeus, Honda

CBR, Hero Honda Karizma, Bajaj Pulsar and TVS Apache. These super bikes are specially

designed for those who have a zeal for speedy drives.

2.1.5 A Growth Perspective

The composition of the two-wheeler industry has witnessed sea changes in the post-reform

period. In 1991, the share of scooters was about 50 per cent of the total 2-wheeler demand

in the Indian market. Motorcycle and moped had been experiencing almost equal level of

shares in the total number of two-wheelers. In 2003-04, the share of motorcycles increased

to 78 per cent of the total two-wheelers while the shares of scooters and mopeds declined

to the level of 16 and 6 per cent respectively. A clear picture of the motorcycle segment's

gaining importance during this period is exhibited by the Figures 1, 2 and 3 depicting total

sales, share and annual growth during the period 1993-94 through 2003-04.


INDUSTRY COMPARISON:

According to SIAM (Society of Indian Automobile Manufacturers), the domestic market

share in 2009-10 for two-wheelers industry is 76.49% which is highest when compared to the

category wise market share with passenger vehicles, commercial vehicles and three wheelers

which has market share of 15.96, 3.95 and 3.6 respectively as shown in Table no.1.

TABLE: 1 DOMESTIC MARKET SHARE FOR 2009-10

Passenger Vehicles 15.96%

Commercial Vehicles 3.95%

Three wheelers 3.6%

Two wheelers 76.49%


Figure 2National Council of Applied Economic Research (NCAER) had forecast two-wheeler demand

during the period 2002¬-03 through 2011-12. The forecasts had been made using

econometric technique along with inputs obtained from a primary survey conducted at 14


prime cities in the country. Estimations were based on Panel Regression, which takes into

account both time series and cross section variation in data. A panel data of 16 major states

over a period of 5 years ending 1999 was used for the estimation of parameters. The models

considered a large number of macro-economic, demographic and socio-economic variables

to arrive at the best estimations for different two-wheeler segments. The projections have

been made at all India and regional levels. Different scenarios have been presented based

on different assumptions regarding the demand drivers of the two-wheeler industry. The

most likely scenario assumed annual growth rate of Gross Domestic Product (GDP) to be 5.5

per cent during 2002¬-03 and was anticipated to increase gradually to 6.5 per cent during

2011¬-12. The all-India and region-wise projected growth trends for the motorcycles and

scooters are presented in Table 1. The demand for mopeds is not presented in this analysis

due to its already shrinking status compared to' motorcycles and scooters.

It is important to remember that the above-mentioned forecast presents a long-term

growth for a period of 10 years. The high growth rate in motorcycle segment at present will

stabilise after a certain point beyond which a condition of equilibrium will set the growth

path. Another important thing to keep in mind while interpreting these growth rates is that

the forecast could consider the trend till 1999 and the model could not capture the recent

developments that have taken place in last few years. However, this will not alter the

regional distribution to a significant extent

Table 1 suggests two important dimensions for the two-¬wheeler industry. The region-wise

numbers of motorcycle and scooter suggest the future market for these segments. At the all

India level, the demand for motorcycles will be almost 10 times of that of the scooters. The

same in the western region will be almost 20 times. It is also evident from the table that

motorcycle will find its major market in the western region of the country, which will

account for more than 40 per cent of its total demand. The south and the north-central

region will follow this. The demand for scooters will be the maximum in the northern region,

which will account for more than 50 per cent of the demand for scooters in 2011-12.


Table 1 Demand Forecast for Motorcycles and Scooters 2011-122-Wheeler Segment Regions

South West North-Central East & North-East All India

Motorcycle2835(12.9)

4327(16.8)

2624(12.5)

883(11.1)

10669(14.0)

Scooter203(2.6)

219(3.5)

602(2.8)

99(2.0)

1124(2.08)

Note: Compound Annual Rate of Growth during 2002-03 and 2011-12 is presented

in parenthesis

Source: Indian Automobile Industry: Optimism in the Air, Industry Insight, NCAER

The present economic situation of the country makes the scenario brighter for short-term

demand. Real GDP growth was at a high level of 7.4 per cent during the first quarter of

2004. Both industry and the service sectors have shown high growth during this period at

the rates of 8.0 and 9.5 per cent respectively. However, poor rainfall last year will pull down

the GDP growth to some extent. Taking into account all these factors along with other

leading indicators including government spending, foreign investment, inflation and export

growth, NCAER has projected an average growth of GDP at 6.7 per cent during the tenth

five-year plan. Its mid-term forecast suggests an expected growth of 7.4 per cent in GDP

during 2004-05 to 2008-09. Very recently, IMF has portrayed a sustained global recovery in

World Economic Outlook. A significant shift has also been observed in Indian households

from the lower income group to the middle income group in recent years. The finance

companies are also more aggressive in their marketing compared to previous years.

Combining all these factors, one may visualise a higher growth rate in two-wheeler

demand than presented in Table 1, particularly for the motorcycle segment.

There is a large untapped market in semi-urban and rural areas of the country. Any strategic

planning for the two¬-wheeler industry needs to identify these markets with the help of

available statistical techniques. Potential markets can be identified as well as prioritised

using these techniques with the help of secondary data on socio-economic parameters. For

the two-wheeler industry, it is also important to identify the target groups for various

categories of motorcycles and scooters. With the formal introduction of second-hand car


market by the reputed car manufacturers and easy loan availability for new as well as used

cars, the two-wheeler industry needs to upgrade its market information system to capture

the new market and to maintain its already existing markets. Availability of easy credit for

two-wheelers in rural and smaller urban areas also requires more focussed attention. It is

also imperative to initiate measures to make the presence of Indian two-wheeler industry

felt in the global market. Adequate incentives for promoting exports and setting up of

institutional mechanism such as Automobile Export Promotion Council would be of great

help for further surge in demand for the Indian two-wheeler industry.

2.1.6 Two-wheelers: Market Size

In terms of volume, 24,613,436 units of two-wheelers were sold in the country in 9MFY2010

with 12,256,765 units exported. The total two-wheeler sales of the Indian industry

accounted for around 87.5% of the total vehicles sold in the period mentioned. After facing

its worst recession during the early 1990s, the industry bounced back with a 25% increase in

volume sales in FY1995. However, the momentum could not be sustained and sales growth

dipped to 20% in FY1996 and further down to 12% in FY1997. The economic slowdown in

FY1998 took a heavy toll of two-wheeler sales, with the year-on-year sales (volume) growth

rate declining to 3% that year. However, sales picked up thereafter mainly on the strength

of an increase in the disposable income of middle-income salaried people (following the

implementation of the Fifth Pay Commission's recommendations), higher access to relatively

inexpensive financing, and increasing availability of fuel efficient two-wheeler models.

Nevertheless, this phenomenon proved short-lived and the two-wheeler sales declined

marginally in FY2006. This was followed by a revival in sales growth for the industry in

FY2007. Although, the overall two-wheeler sales increased in FY2007, the scooter and

moped segments faced de-growth. FY2009 also witnessed a healthy growth in overall two-

wheeler sales led by higher growth in motorcycles even as the sales of scooters and mopeds

continued to decline. Healthy growth in two-wheeler sales during FY2004 was led by growth

in motorcycles even as the scooters segment posted healthy growth while the mopeds

continued to decline. Figure below presents the variations across various product sub-

segments of the two-wheeler industry between FY2009 and FY2010.


Figure 3: Market Size

2.1.7 Demand Drivers

The demand for two-wheelers has been influenced by a number of factors over the past five

years.

The key demand drivers for the growth of the two-wheeler industry are as follows:

▪ Inadequate public transportation system, especially in the semi-urban and rural areas.

▪ Increased availability of cheap consumer financing in the past 3-4 years.

▪ Increasing availability of fuel-efficient and low-maintenance models.

▪ Increasing urbanisation, which creates a need for personal transportation.

▪ Changes in the demographic profile.


▪ Difference between two-wheeler and passenger car prices, which makes two-wheelers

the entry-level vehicle.

▪ Steady increase in per capita income over the past five years; and

▪ Increasing number of models with different features to satisfy diverse consumer needs.

2.1.8 Rise in GDP per Capita has increased affordability of Two Wheelers

India’s per capita real GDP growth of 7% (CAGR) over the last six years (refer

Chart 1) has contributed substantially towards raising the standard of living of

households, which in turn has been one of the key drivers of growth for the country’s

automobile industry. However, income growth is likely to have been uneven across the

different income deciles. Income at the lower end of the distribution scale, which

comprises the 2W target segment2, is likely to have grown at a rate below the overall

per capita income growth rate. Yet economic well-being has led to a significant

increase in the number of households coming within the 2W target segment over the

past few years. As per NCAER’s estimates, the number of households having annual

income between Rs. 200,000- 00,000 is estimated to have increased to 22 million in

2009-10, a scale-up by a factor of 2.5x over 2001-02 (refer Chart2). Incidentally, this

scale-up is almost similar to the expansion in the domestic 2W industry size (by volumes)

during this period.


MARKET CHARACTERISTICS

2.1.8.1 Demand

2.1.8.2 Segmental Classification and Characteristics

The three main product segments in the two-wheeler category are scooters, motorcycles

and mopeds. However, in response to evolving demographics and various other factors,

other sub-segments emerged, viz. scooterettes, gearless scooters, and 4-stroke scooters.

While the first two emerged as a response to demographic changes, the introduction of 4-

stroke scooters has followed the imposition of stringent pollution control norms in the early

2000. Besides, these prominent sub-segments, product groups within these sub-segments

have gained importance in the recent years. Examples include 125cc motorcycles, 100-125

cc gearless scooters, etc. The characteristics of each of the three broad segments are

discussed in Table 2.

Table 2: 2W- Comparative Characteristics

Two-Wheelers: Comparative Characteristics

Scooter Motorcycle Moped

Price*(Rs. as in January

2005) > 22,000 > 30,000 > 12,000

Stroke2-stroke, 4-

strokeMainly 4-stroke 2-stroke

Engine Capacity (cc) 90-150 100, 125, > 125 50, 60

Ignition Kick/Electronic Kick/Electronic Kick/Electronic

Engine Power (bhp) 6.5-9 7-8 and above 2-3

Weight (kg) 90-100 > 100 60-70

Fuel Efficiency (kms 50-75 50-80+ 70-80


per litre)

Load Carrying High Highest Low

*Ex-showroom Bangalore

Compiled by INGRES

Segmental Market Share

The Indian two-wheeler industry has undergone a significant change over the past 10 years

with the preference changing from scooters and mopeds to motorcycles. The scooters

segment was the largest till FY1998, accounting for around 42% of the two-wheeler sales

(motorcycles and mopeds accounted for 37% and 21 % of the market respectively, that

year). However, the motorcycles segment that had witnessed high growth (since FY1994)

became larger than the scooter segment in terms of market share for the first time in

FY1999. Between FY1996 and 9MFY2005, the motorcycles segment more than doubled its

share of the two-wheeler industry to 79% even as the market shares of scooters and

mopeds stood lower at 16% and 5%, respectively.

out. Nevertheless, the past few years have witnessed a shift in preference towards gearless

scooters (that are popular among women) within the scooters segment. Motorcycles, offer

higher fuel efficiency, greater acceleration and more environment-friendliness. Given the

declining difference in prices of scooters and motorcycles in the past few years, the

preference has shifted towards motorcycles. Besides a change in demographic profile,

technology and reduction in the price difference between motorcycles and scooters,

another factor that has weighed in favour of motorcycles is the high re-sale value they offer.

Thus, the customer is willing to pay an up-front premium while purchasing a motorcycle in

exchange for lower maintenance and a relatively higher resale value.

2.1.9 TWO WHEELER: CATEGORIES AND SEGEMENTS


2.1.9.1 MARKET SEGMENTATION

Market segmentation is the science of dividing an overall market into key customer subsets,

or segments, whose members share similar characteristics and needs. Because it involves

significant market research, market segmentation can be costly. But it is particularly

important for small businesses, which often lack the resources to target large aggregate

markets or to maintain a wide range of differentiated products for varied markets. Market

segmentation allows a small business to develop a product and a marketing mix that fit a

relatively homogenous part of the total market. By focusing its resources on a specific

customer base in this way, a small business may be able to carve out a market niche that it

can serve well than its larger competitors.

Market segmentation lies somewhere near the middle of a continuum of marketing

strategies that range from mass marketing—in which a single product is offered to all

customers in a market—to one-to one marketing—in which a different product is specifically

designed for each individual customer in a market. Most businesses realize that since no

two people are exactly alike, it is unlikely that they will be able to please all customers in a

market with a single product. They also realize that it is rarely feasible to create a distinct

product for every customer. Instead, most businesses attempt to improve their odds of

attracting a significant base of customers by dividing the overall market into segments, then

trying to match their product and marketing mix more closely to the needs of one or more

segments. A number of customer characteristics, known as segmentation bases, can be used

to define market segments. Some commonly used bases include age, gender, income,

geographical area, and buying behaviour.

When we talk about categories in two-wheeler industry, it is exclusive into three variances,

i.e.

Motorcycles

Scooters

Mopeds


Since, the objective of my study and project is confined to Motorcycles; I would not touch

the other two categories as it gets extensive as well as deviates from the prime objective.

However, segments are required to be discussed as it helps to distinguish between various

brands, draws an impact on consumer buying behaviour and also helps in understanding the

consumer’s spending pattern.

There are majorly three segments in the Indian motorcycle industry. Based on these

segments, the motorcycles are categorized and differentiate itself from the other. To have

an adequate knowledge of these segments is of utmost importance, both for the consumers

as well as the companies so that they can position their products to the right target

audience with an overtly impactful message that generates a craving amongst the

consumers and thus creates a demand for the particular product.

The following are the three segments in motorcycle industry:

Premium Segment

Executive Segment

Economy Segment

2.1.9.2 PREMIUM SEGMENT


Premium refers to a segment of a company's brands or products that carries tangible or

imaginary surplus value in the upper mid- to high price range. The targeted high income

customer group is also frequently referred to as "premium". Premium brands are designed

to convey an impression of exclusiveness, especially in the mass markets. Frequently,

companies will invent different (sub) brands to differentiate their product lines into a

premium and a general segment. In most ways, the premium segment can be thought of as

the contrary to generic brands. In that sense, the term "premium" replaces the traditional

attribute "luxury". Motorcycle models with a price of over Rs. 50,000 comprise the Premium

segment, which consists

largely of greater than 150 cc engine capacity bikes. This category is the most

segmented and includes:

(a) Performance bikes, ranging from 150cc to 220 cc and consisting of Hero Honda’s

Glamour, Achiever, CBZ Extreme, Hunk and Karizma; Bajaj Auto’s Pulsar family, Honda

Motorcycles & Scooter’s Unicorn Dazzler, and TVS’ Apache RTR, besides models from the

stables of Suzuki and Yamaha.

(b) Cruiser bikes such as Royal Enfield’s Bullet and Bajaj Auto’s Avenger

(c) Ultra biking range consisting of Bajaj Auto’s Kawasaki Ninja, Honda Motorcycles &

Scooters’ CB 1000R, Suzuki’s Hayabusa and Yamaha’s YZF-R1.


2.1.9.3 EXECUTIVE SEGMENT

It is a segment “Just” above the entry-level motorcycles. By entry-level we mean the entry-

level bike is the cheapest motorcycle, money can buy in India. Motorcycle models with a price

between Rs. 40,000-50,000 comprise the Executive

segment, which is largely concentrated around the 100-125 cc models. The segment has benefited

the most due to up-trading from the Entry segment consequent to the growing sophistication of

customers, besides the steady and secure replacement demand. Accordingly, the segment’s

share in the domestic motorcycles segment has risen from 48% in 2005-06 to 65% in 2010-11.

Being the largest volume generator, the Executive segment has also seen the largest number of new

model launches and portfolio refurbishments by all players and involves the highest product and

brand clutter.


Existing brands in Executive Segment

COMPANY BRANDS 100cc BRANDS 125cc

HERO HONDA Splendor Plus

Splendor NXG

Passion Plus

Passion Pro

Super Splendor

BAJAJ AUTO Discover 100 Platina 125

Discover 125

TVS Jive Flame

HONDA MOTORCYCLES

& SCOOTERS

CB Twister CB Shine

SUZUKI - Slingshot

YAMAHA YBR, G5 YBR125, SS125

MAHINDRA Stallio -

2.1.9.4 ECONOMY SEGMENT


Motorcycle models with a sticker price of up to Rs. 40,000 constitute the Entry

segment. This segment largely consists of 100cc bikes and is currently composed of the CD

Dawn and CD Deluxe models of HHML, Platina of BAL, Star Sport of TVS and Crux and Alba of

Yamaha. The Entry segment has faced continual volume pressures in the domestic market

over the last several years and was also the worst hit during the credit squeeze in H2, 2007-

08 and the economic slowdown of 2008-09. Although sales volumes in this segment

have remained flat over 2009-10 and 2010-11, the segment’s share in the domestic 2W

market has steadily declined from 43% in 2005-06 to 16% in 2010-11. Several factors have

contributed to the waning importance of the entry segment in the Indian 2W market.

These include the gradual shift in preference of consumers in favour of the more feature-

rich Executive segment, reluctance of organized financiers to increase credit exposure on

this segment and the OEMs’ own strategy of reducing focus on this relatively less profitable

segment.

Brand Churn in Economy Segment

COMPANY BRANDS DISCONTINUE

D

EXISTING BRANDS

HERO HONDA

CD 100, Street, Joy CD Dawn

BAJAJ AUTO CT 100, Boxer, Byk

Platina

TVS Centra, Spectra, Max 100

StaR City, Sport


2.2 MAJOR PLAYERS

HERO HONDA

BAJAJ AUTO

TVS MOTOR

ROYAL ENFIELD

HONDA MOTORCYCLES & SCOOTERS

SUZUKI

YAMAHA

2.2.1

Hero Honda Motors Limited is a two wheeler manufacturer based in India. Hero Honda is a

joint venture between the Hero Group of India and Honda of Japan. The company is the

largest two wheeler manufacturer in India. The 2006 Forbes 200 Most Respected companies

list has Hero Honda Motors ranked at 108.

“Hero” is the brand name used by the Munjal brothers for their flagship company Hero Cycles Ltd. A

joint venture between the Hero Group and Honda Motor Company was established in 1984 as the

Hero Honda Motors Limited At Dharuhera India. Munjal family and Honda group both own 26%

stake in the Company. In 2010, it was reported that Honda planned to sell its stake in the venture to

the Munjal family.

During the 1980s, the company introduced motorcycles that were popular in India for their fuel

economy and low cost. A popular advertising campaign based on the slogan 'Fill it - Shut it - Forget it'

that emphasized the motorcycle's fuel efficiency helped the company grow at a double-digit pace

since inception. The technology in the bikes of Hero Honda for almost 26 years (1984–2010) has

come from the Japanese counterpart Honda


Hero Honda has a large sales and service network with over 3,000 dealerships and service points

across India. Hero Honda has a customer loyalty program since 2000, called the Hero Honda

Passport Program.

2.2.1.1 MOTORCYCLE MODELS

Achiever

Ambition 133, Ambition 135

CBZ, CBZ Star, CBZ Xtreme

CD 100, CD 100 SS, CD Dawn, CD Deluxe, CD Deluxe (Self Start)

Glamour, Glamour F.I

Hunk

Karizma, Karizma R, Karizma ZMR FI

Passion, Passion+, Passion Pro

Pleasure

Splendor, Splendor+, Splendor+ (Limited Edition), Super Splendor, Splendor NXG,

Splendor PRO

2.2.2

Bajaj Auto is a major Indian vehicle manufacturer started by a Rajasthani merchant. It is

based in Pune, Maharashtra, with plants in Chakan (Pune), Waluj (near Aurangabad) and

Pantnagar in Uttaranchal. The oldest plant at Akurdi (Pune) now houses the R&D centre

Ahead. Bajaj Auto manufactures and exports automobiles scooters, motorcycles and the

auto rickshaw.

The Forbes Global 2000 list for the year 2005 ranked Bajaj Auto at 1,946, although it does

not feature in the 2010 list.

Over the last decade, the company has successfully changed its image from a scooter

manufacturer to a two wheeler manufacturer. Its product range encompasses scooterettes,

scooters and motorcycles. Its real growth in numbers has come in the last four years after

successful introduction of a few models in the motorcycle segment.


The company is headed by Rahul Bajaj who is worth more than US$1.5 billion.

According to the authors of Globality: Competing with Everyone from Everywhere for

Everything, Bajaj has grown operations in 50 countries by creating a line of value-for-money

bikes targeted to the different preferences of entry-level buyers.


Bajaj Platina 100cc

Bajaj Platina 125 DTS-Si

Bajaj Discover 135 DTS-i

Bajaj XCD 125 DTS-Si

Bajaj XCD 135 DTS-Si

Bajaj Pulsar 135 DTSi




Bajaj Pulsar 220 DTS-Fi


Bajaj Avenger 220 DTS-i

2.2.3

Honda Motorcycle & Scooter India, Private Limited (HMSI) is the wholly owned Indian

subsidiary of Honda Motor Company, Limited, Japan. Founded in 1999, it was the fourth

Honda automotive venture in India, after Hero Honda, Kinetic Honda Motor Ltd and Honda

Siel Cars India Limited.

The entry of Honda into the Indian market as HMSI began with the launch of the Honda

Activa, a 100 cc scooter. A slightly modified trendier version of the Activa was soon

launched, as the Honda Dio. Honda Eterno was launched thereafter to add to the portfolio

of HMSI's scooters.


The Honda Unicorn was the first motorcycle released by HMSI. The Honda Shine has since

been released.


Honda Unicorn

Honda Shine

Honda CBF Stunner

Honda CB Unicorn Dazzler

Honda CB Twister

Honda CBR 220

2.2.4 MARKET SHARE


The following data is extracted from http://business.rediff.com/report/2010/jul/07/auto-bajaj-

rides-on-discover-to-regain-market-share.htm

The following figure helps to determine the growth of the companies in the financial year

2009-2010. Hero Honda loses out on 9 percent from the last year whereas we can see a

progressive growth of 9 percent with Bajaj Auto. The reports say that the flagship

motorcycle of the company’s executive segment i.e. Bajaj Discover helped the company to

climb up a huge margin of 9 percent in one year. Sales has smashed all records and

apparently there does not seems to be any looking back for Bajaj Auto as of now.

Surprisingly, there have been no signs of improvement with TVS Motor and Honda

Motorcycles. However, the good news is that they haven’t incurred any losses as well.

2.3 PEST ANALYSIS ON TWO-WHEELER INDUSTRY:


http://business.rediff.com/report/2010/jul/07/auto-bajaj-rides-on-discover-to-regain-market-share.htm

http://business.rediff.com/report/2010/jul/07/auto-bajaj-rides-on-discover-to-regain-market-share.htm

Political, economic, social and technology are those factors which affects the external

environment.

Political Aspects – Tax policies, trade regulation, political influence and some of the rules

and regulation of government policies which is considered in political analysis.

The corrections in Excise duty on electric vehicles which will enable the manufacturers take

CENVAT credit and exemption of customs duty on Electric Vehicles parts and also weighted

deduction for in-house R&D to 200% from 150% and outsourced R&D from 125% to 175%.

This would encourage industry that much because this price hike isn’t expected to impact

sales in a significant way as a majority of two-wheeler buyers were prepared, and to certain

extend braced up and ready to shell out extra money for their favourite set of wheels.

Economic Aspects – Economic factor are those which is influenced by economic growth,

interest rate, exchange rate and inflation rate.

Abundant and low cost labour coupled with local availability of raw material like steel,

aluminium and natural rubber has placed India amongst the low cost producing centres of

two-wheelers. Consequently, CARE Research anticipant’s buoyant growth in two-wheelers

exports as well. Abundance of low labour and raw material gives India an upper hand in the

export. Since many auto finance company laid easy instalment rules with less interest rate it

makes more segment people to go for it.

Social Aspects – Social aspects of two-wheelers industry are Popularity, Subculture,

Mobility and safety.

In numerous cultures, motorcycles are the primary means of motorized transport. India is the

second largest motorcycle markets in the world next to China. Socially many motor cycle

organization raise money for charities through organized ride and events. Many people ride

motorcycle for various reasons, those reasons are increasingly practical, with riders opting for

a powered two-wheeler as a cost-efficient alternative to infrequent and expensive public

transport system, or as a means of avoiding or reducing the effect of urban congestion.

Motor-cycle gives a great advantage to the specified designation where other buses cannot

enter. Since there is a rule in some of the main states and cities in India to wear helmet while

riding two-wheelers to make them safe from accidents makes two-wheeler riders to have a

safe journey.


Technical Aspects - Technical Aspects in Two-wheeler industry includes construction, fuel

economy, electric motorcycles, dynamics and accessories.

Two-wheeler construction is the engineering, manufacturing, and assembly of components

and systems for two-wheelers which results in performance, cost and aesthetics desired by the

designers. Construction of two-wheeler includes steel, aluminium frame, telescopic forks and

disc brakes. Motorcycle is the best fuel economy mode of transport, Nowadays two-wheelers

is designed to give more than 80km mileage per litre with low maintenance cost. Invention of

Electric motorcycle gives an added advantage since the two-wheeler users can avoid using

petrol. Different types of two-wheelers have different dynamics and these plays a vital role in

their performance. Since sufficient bike accessories are available in many place two-wheeler

riders has a privilege to change the broken parts very easily.

2.4 PORTER’S 5 FORCES ANALYSIS

Porter’s five forces Model of Competition are as follows:

Rivalry among competing sellers

Potential new entrants

Substitute products

Competitive pressures from supplier - seller relations: Bargaining power

Competitive pressures from seller – buyer relations: Bargaining power.

RIVALRY: The key players in two-wheeler industries are Hero Honda motor ltd. (HHML),

Bajaj Auto ltd and TVS motor Company ltd. The other players are Kinetic, LML, Yamaha,

Majestic auto ltd, Royal Enfield ltd and Honda motorcycle & scooter India. Two-wheelers

domestic market growth rate for 2008-09 is 76.49% which is very high when compared to

that of three wheelers, Passenger and commercial vehicles. The standardized product used in

manufacturing of two-wheelers is steel, aluminium and rubber, because there are many

industries in India for manufacturing those standardized product the production is going

smooth. Sales of two-wheelers are very high when compared to that of three wheelers,

Passenger and commercial vehicles. Indian Auto policy 2002 gives added advantage to two-


wheeler manufacturers to enter even other countries outside India. Since big manufacturer

plant with high technology and good R&D team needed many of them dose not enter in two

two-wheeler Industries. Only the companies which are in automobile line will expand their

product line like Mahindra.

Potential New Entrants: Capital investment is very huge in two-wheeler industries since

large plant and large machineries needed with skilled labours and good R&D team needed for

producing two-wheelers. Since high technology and raw material resources are abundant to

produce the production cost is less in producing two-wheelers. Since each company in

industry change the model on going basis to show differentiation among their competitors

because of this there is more learning and experience in this field. Each company in industry

not only makes differentiation in their product strategy but also makes differentiation in the

promotional strategy to create” brand preference and loyalty”. Because of low cost

production, this industry enjoys good growth rate and profitability.

Substitute Product: Substitute products for two-wheeler industries are bus transportation,

Auto transportation and even low-end cars, but people using two-wheelers can only use the

service of buses and auto as a substitute product. Sometimes low-end car is a substitute

product for the people using high-end motor cycles. Because nowadays there is lot of

segment in buses in urban areas and the private companies also influenced very much, buses

are available from normal buses to hi-tech ac buses which is threat to two-wheeler industry.

Since only two people can travel in a bike most of them uses auto when they go out with their

family and if they are affordable to buy car will use car instead of auto. Since bus service has

increased when compared to five years back people who are aged above 45 years uses buses

because of their health condition. These are the substitute product available to two-wheelers.

Supplier – Seller Relations: Since their selling units are very high in two-wheeler industry

and because of many competitors supplier are very high. Since they change their models

ongoing basis they create good relationship between their suppliers. Some of the components

in two-wheeler industry are very common for all the two-wheeler industries like steel,

aluminium, tyres and tubes, these material are available in abundant. This makes them to

drive a smooth production of their finished products.


Seller – Buyer Relations: Buyer has added advantage than seller because there are five to

six big popular brands of two-wheelers are available in India, so that they can switch brand

from one another. Since full information is available to the buyers about their product details

and their prices buyers are fully aware of seller costs and products. Buyers are very conscious

in spending their money to purchase two-wheeler, because it attracts most of the middle-

income group’s seller cannot price their product very high. Nowadays people go to unique

brand because of the good service they provide after purchase. Because service centers and

spare parts shop available to their customer very near to their place buyer sometimes do not

mind spending little money extra. These factors create good relationship between them.

2.5 COMPANY PROFILE


TVS MOTOR

TVS Motor Company is the third largest two-wheeler manufacturer in India and one among

the top ten in the world, with annual turnover of more than USD 1 billion in 2008-2009, and

is the flagship company of the USD 4 billion TVS Group. It manufactures motorcycles,

scooters, mopeds and auto rickshaws. It is India's only two-wheeler company to have won

the Deming Prize awarded for commitment to quality control, received in 2002.

2.5.1 History2.5.2 The Legacy of TV Sundaram Iyengar

TVS Motor traces its origins back to the entrepreneurial spirit of Trichur Venkagaruswamy

Sundaram Iyengar who gave up lucrative careers in the Indian Railways and in banking to set

up his own business. He began with Madurai's first bus service in 1912 and founded

T.V.Sundaram Iyengar and Sons Limited, a company that consolidated its presence in the

transportation business with a large fleet of trucks and buses under the name of Southern

Roadways Limited. When he died in 1955 his sons took the company ahead with several

forays in the automobile sector, including finance, insurance, manufacture of two-wheelers,


tyres and components. The group has managed to run 33 companies that account for a

combined turnover of nearly $3 billion.

2.5.3 The Early Years

Sundaram Clayton, then the flagship company, was founded in 1962 in collaboration with

Clayton Dewandre Holdings, United Kingdom. It manufactured brakes, exhausts,

compressors and various other automotive parts. The company set up a plant at Hosur in

1978 to manufacture mopeds as part of a new division. A technical collaboration with the

Japanese auto giant resulted in the joint-venture Ind Suzuki Limited in 1982 between

Sundaram Clayton Ltd and Suzuki Motor Corporation. Commercial production of

motorcycles began in 1984.

2.5.4 The TVS Suzuki Relationship

TVS and Suzuki shared a 19 year long relationship that was aimed at technology transfer to

enable design and manufacture of two-wheelers specifically for the Indian market.

Rechristened TVS-Suzuki, the company brought out several models such as the Suzuki

Samurai, Suzuki Shogun and Suzuki Fiero. Differences in opinion on how to run the joint

venture eventually led to the partners going their separate ways in 2001 with the company

being renamed TVS Motor, relinquishing rights to use the Suzuki name. There was also a 30

month moratorium period during which Suzuki promised not to enter the Indian market

with competing two-wheelers. The company also got over a period of labour unrest that

required Chairman Venu Srinivasan to take tough measures to resurrect a company that was

in a state of turmoil. He would go on to invest in new technology, nurture in-house design,

and implement Toyota-style quality programs.

2.5.5 Rise to Present Prominence2.5.6

Over the years TVS Motor has grown to be the largest in the group, both in terms of size and

turnover, with four state of the art manufacturing plants in Hosur, Mysore and Nalagarh in

India and Karawang in Indonesia. TVS Motor is credited with many innovations in the Indian

automobile industry, notable among them being the introduction of India's first two-seater


moped, the TVS 50cc. The company became the leader in its category of sub 100 cc mopeds,

having sold 7 million units. It also introduced the TVS Scooty, which is India's second largest

brand in the scooterettes segment. The TVS Jive launched in November 2009 became India's

first clutch-free motorbike aimed at a stress-free rider experience while the unisex scooter

Wego is targeted at urban couples, featuring body-balance technology for easier handling.

2.5.7 Awards

"TVS Motor Company has been awarded 'Star Performer -

Silver Shield' in two/three wheelers category, by EEPC India, for excellent export performance

for year 2007-08. The award was presented by the Hon'ble President of Republic of Maldives,

Mr. Mohamed Nasheed, at a glittering function at Maldives on 21st Feb'10"

2.6 TVS Motor Company – Mission & Vision

2.6.1 TVS Motor Company - Mission

We are committed to being a highly profitable, socially responsible, and leading

manufacturer of high value for money, environmentally friendly, lifetime personal

transportation products under the TVS brand, for customers predominantly in Asian markets

and to provide fulfilment and prosperity for employees, dealers and suppliers.

2.6.2 Vision Statement

2.6.2.1 TVS Motor - Driven by the customer

TVS Motor will be responsive to customer requirements consonant with its core competence

and profitability. TVS Motor will provide total customer satisfaction by giving the customer

the right product, at the right price, at the right time.

2.6.2.2 TVS Motor - The Industry Leader

TVS Motor will be one among the top two two-wheeler manufacturers in India and one

among the top five two-wheeler manufacturers in Asia.


2.6.2.3 TVS Motor - Global overview

TVS Motor will have profitable operations overseas especially in Asian markets, capitalizing

on the expertise developed in the areas of manufacturing, technology and marketing. The

thrust will be to achieve a significant share for international business in the total turnover.

2.6.2.4 TVS Motor - At the cutting edge

TVS Motor will hone and sustain its cutting edge of technology by constant benchmarking

against international leaders.

2.6.2.5 TVS Motor - Committed to Total Quality

TVS Motor is committed to achieving a self-reviewing organization in perpetuity by adopting

TQM as a way of life. TVS Motor believes in the importance of the process. People and

projects will be evaluated both by their end results and the process adopted.

2.6.2.6 TVS Motor - The Human Factor

TVS Motor believes that people make an organization and that its well-being is dependent on

the commitment and growth of its people. There will be a sustained effort through systematic

training and planning career growth to develop employees’ talents and enhance job

satisfaction. TVS Motor will create an enabling ambience where the maximum self-

actualisation of every employee is achieved. TVS Motor will support and encourage the

process of self-renewal in all its employees and nurture their sense of self worth.


2.7 MOTORCYCLE MODELS

International Range-Two Wheeler

Three Wheeler


2.8 SWOT ANALYSIS OF TVS MOTOR COMPANY LIMITED

Strength of TVS Motor Company LTD.

Machine: Using all top machines of the world and Money: Finance has never been a

problem for:

1. Motor: Because of its proper financial management and reputation it has a huge group of

investors.

2. Material: TVS Motor Company LTD. never faces problem in case of raw Materials

because of good contacts.

3. Management: TVS Motor Company Ltd. has got excellent Management because workers

are relived without any chaos.

4. Monitoring: TVS Motor Company Ltd. has got excellent monitoring System, which helps

in smooth working of industry.

WEAKNESS:

Huge amount of money is blocked in raw materials which are needed as a production process

and also spent in procuring parts of the machines, a huge amount of money is spend on new

machines every now and then due to advancement in technology. Due to composite unit they

have to follow all the rules & regulation of governments.

OPPORTUNITY:

There is a golden opportunity for the company, if it uses its brand name effectively and

advertises it effectively.

Opportunity to capture more market shares if it increases its strength.

Opportunity to enter new business areas because of the well established brand name.

THREATS:


Threat from the competitor regarding the way of doing business.

Threat of new entrants

3 PROJECT PROFILE

3.1 OBJECTIVES OF THE STUDY

The primary objective of the research is to “Investigate consumer attitude, perception and

buying behaviour towards the economy segment motorcycles in the domestic market.”

The objectives of the study are:

To determine the consumer perception and choice towards different motorcycle

brands and also determine the most preferred motorcycle in the economy segment.

To analyze various attributes consumers look for while making their purchase

To examine whether income accounts for future purchasing preferences.

To understand the impact of media on consumer buying behaviour and also zero in

the most suitable means to promote the brand and products

The project was started by developing an open ended Questionnaire and doing an extensive

exploratory research on the consumer buying behaviour, this was done by collecting data and

views of the customers in the service stations and of those who visited the showrooms in

Bangalore. The exploratory study was done in order to understand the nature of problem so as

to determine the best research design, collection method and selection of subjects. It was

undertaken to draw definitive conclusions only with extreme caution. It was performed in the

stipulated time frame of two weeks and relied on Secondary Data such as books, magazines,

case studies etc and qualitative approach such as informal discussions with Consumers,

employees and management.

The second part of the study involved analysis of the data collected and then the collected

data was used to design a close ended final questionnaire which was surveyed in the rural

areas and domestic market of Bangalore by the target group .It was filled by 260 respondents.

Transmitting the collected data from hard copy format to Microsoft Excel and finally to SPSS


was the last and eminent operation that was performed and various tests were run in order to

analyse the data. Details of the tests performed are as follows:

1. Descriptive Statistical Test

2. Frequency Analysis

3. Bar Chart Representation

4. Npar Tests

5. Friedman Test

6. Cross tabulation

7. Chi-Square Test

8. Discriminant Analysis

9. Factor Analysis

3.2 RESEARCH METHODOLOGY

The effectiveness of the marketing research largely depends on the formulation of an

appropriate research design considering adequate sample size, variables, and proper tools for

data collection suitable to the problem given.

The basis data collection and research technique adopted for the research work was:

Primary research technique

Secondary research technique

Primary research was conducted in order to find out different brands of motorcycles that

people are aware off and buy, and also what are the criteria that enable them to buy a

particular brand.

Secondary research was conducted to carry out the market analysis of Two-wheeler

automobile sector and the latest market trends in motorcycle industry. The major portions

covered are the competitor description and the major players.


3.2.1 Data Source:

There are two types of data sources i.e. primary and secondary data. Primary data is original

data collected specifically for the purpose of the research in question. The primary data for

this study was obtained from the questionnaire used in sampling the respondents.

Secondary sources included journals, books, websites, databases and brand surveys.

3.2.2 Sample Size:

For this specific research I have taken a sample size between 261 respondents residing in

and around the Bangalore city. It includes consumers from different buying points i.e.

dealers in the city. The sample is comprised exclusively of male respondents.

3.2.3 Research Methodology Adopted:

The basic research methodology adopted was exploratory research. Exploratory research

can be quite informal, relying on secondary research such as reviewing available literature

and data, or qualitative research approaches such as informal discussions with consumers,

formal approaches through in-depth interviews or projective methods. The results of

exploratory research are useful for decision making while the qualitative research can give

some indication as to why, how and when something occurs.

3.2.4 Data Collection:

The nature of research can be either qualitative or quantitative. The primary research data

required for this study is of a quantitative nature. The quantitative research data was

collected by means of a questionnaire on a face-to-face basis and via telephonic interviews.

The secondary data was collected from various published sources.

3.2.5 Sampling Profile:


The primary audience for the research conducted was males within an age group of 20-50

years. Working men and students are also been administered during the course of this

research.

3.2.6 Sampling Method:

The sampling method used for the study is the convenient sampling method.

3.2.6.1 The research was undertaken in following steps based action plan:

Research objectives are being transformed into the action plan.

Target audience is identified.

Necessary literature read and applied few techniques as applicable.

Initial set of questions framed and tested with initial few samples.

Question/Scale Measurements is being evaluated.

Modified the questionnaire as required.

Location of survey to be conducted is identified.

Revised questionnaire is implemented.

Questionnaire filled by the targeted audience.

Data collected and analyzed.

3.3 Limitations of the Study

The limitations of the study are as follows:

1. Continuous and reliable information was not available due to differences in opinion,

so the information is liable to change.

2. Avoidance by the respondents amidst their busy schedule did not permit detailed

study because they couldn’t give sufficient time to discuss the questionnaire.

3. In the extended sample the findings could have been different.

4. Respondents were reluctant to give detailed responses.


3.4 Tools Used To Conduct The Research.

The following tools were used to complete the above stated study:

1. MS Excel software is used to have the percentage analysis of the various data

obtained through survey and to draw the graphs subsequently.

2. SPSS software is used and techniques like:

Factor analysis is used in order to determine the number of factors highly responsible

for consumer buying decision.

Chi-Square is use to understand the relationship between the brand preference and

other variables like age, income and gender.


4 OBSERVATIONS AND ANALYSIS

4.1 Project Implementation and Observation

Study was initiated with the understanding of Consumer buying behaviour before further

proceedings were done. Following Observations were made:

4.1.1 UNDERSTANDING THE NEED

Why do customers buy?

What goes on inside a customer's mind before, during and after a purchase?

How do buyers choose?

What are the hidden influences?

How do buyers process information?

4.1.2 THE REASON FOR RESEARCH

Consumers are not perfectly rational, sensible buyers. They do not always choose goods and

services solely on price, performance and availability. The truth is that many purchases are

influenced by a whole host of emotional reasons like esteem and image. Many of these non-

rational reasons are hidden deep in our subconscious. In-depth research probes into the darker

depths of their unconscious. Research helps find the real reasons why we buy what we buy.

This requires time, money and expertise. Surprisingly many other organisations don't really

know exactly why their customers buy or don't buy from them. Yet understanding customers

is at the heart of marketing. Once the reasons why people buy or don't buy are discovered, the

marketing mix can be changed to suit the buyer's needs and wants. Buyer behaviour involves

both simple and complex mental processes. Marketers cannot capture human nature in its

entirety but we can learn a lot about customers through research, observation and thinking.


4.1.3 BUYING BEHAVIOUR

The consumer buying behaviour is somewhat repetitive. The consumer’s frequency of buying

products varies with the type of products he buys. This purchase cycle determines when the

consumer is going to buy a product. For a durable product this purchase cycle will be lengthy.

For instance, purchase of a two-wheeler is infrequent whereas non durable products like food,

clothes etc the purchase is frequent and the purchase cycle will be short. In repetitive buying

behaviour the consumer always forms a routine in his decision process.

4.2 FACTORS AFFECTING CONSUMER BUYING BEHAVIOUR

The ultimate objective of the business firm is to create a consumer who is said to pivot

around whom the business of the firm is said to revolve.

Thus a business firm’s marketing concept is consumer oriented and emphasis is done more on

the consumer rather than the product. The essence of modern marketing lies in building profit

along with creating meaningful satisfaction for the consumers, whose needs and desires have

to be coordinated within the set of products and production programmes. Thus the marketing

success depends upon its ability to create a community of satisfied consumers. All the

business activities should be carried out in ways which are directed towards the satisfaction

of consumer needs.

A consumers decision process to purchase a particular motor bike is being resulted as a

complex interplay of a consumer variables the starting point for the company provides the

decision process marketing stimuli in shape of brand ,promotion ,price, and distribution

strategy. The potential consumer along with the other stimuli already exciting him receives

the marketing stimuli in the environment. The stimuli may be social, economic, cultural,

technological and political in nature.

Following are the factors affecting the consumer buying behavior:


01. Cultural Factor

02. Social Factor

03. Personal Factor

04. Psychological Factor

4.3 Data Analysis on the basis of the survey( Open & Close Ended)

The survey was done 3 days in Tristar (Ring road Koramangla) which included both

the showroom and the service station, 2days in Meghdoot motors (Trinity circle), 2 days

in Cambridge layout, Thippasandra and Anekal.

1. SALES OF THE DIFFERENT BRANDS OF MOTORCYCLES

Sales

HERO HONDABAJAJTVSROYAL ENFIELDYAMAHAHONDASUZUKI


Hero Honda Bajaj TVS Yamaha

11-Splendors 7-Discover 8- Star city 1-RX-100

3-Passion plus 5-Pulsar 1- Fiero 1-RXZ

2-Passion 2-Platina 2- Victor

2-CBZ

2-CD 100

1-CD dawn

Others-4-Royal Enfield’s

1- Honda Unicorn

3-Suzuki Zeus

4- Apache

Out of 60 respondents 12 respondents were for Hero Honda and the least were for Honda

2. IMPORTANCE OF ATTRIBUTES


Importance of Attributes

MileageLooksPriceDurabilitySpeed&PerformX-FactorControl&SafetyPower&Weight Ratio

The most important attributes according to survey done were

Mileage looks& style and price and the least important attributes were Colour,

Brand and Speed.

3. FACTORS WHICH MOTIVATED THE RESPONDENTS TO PURCHASE THE

MOTORCYCLE


Reason for purchase

NeedLocal conveyanceBrand AffinityComfortStyleBudget

Need, Local conveyance, Brand affinity, Comfort, Style and Budget respectively were the

following reasons for motivation.

4. EXPECTED MILEAGE

Less than 30 Kmpl

30-40Kmpl 40-50Kmpl 50-70kmpl More than 70kmpl

0

2

4

6

8

10

12

14

16

18

20

Expected Mileage

Responses

< 30 30-40 40 - 50 50-70 >70

9 12 15 19 5

The maximum number of respondents were between 50-70 Kmpl and the least under the

range of More than 70 Kmpl.


5. AMOUNT OF MONEY RESPONDENTS WERE WILLING TO SPEND TO

PURCHASE A MOTORCYCLE

Less than 40000 and

second hand purchse

40,000-50,000 50,000-70,000 More than 70,000

Gifts0

5

10

15

20

25

Responses

Responses

<40k&Second

hand

40-50 50-70 70+ Gifts

9 17 23 7 3

Maximum number of respondents were under 50-70k category .The reason being people have

more disposable income.

6. ANALYSIS ON PREFERENCE OF COLOURS


Colours

BlackBlueRedGreyWhiteCombinations

Colours Blue Black Red Grey White Combinations

Responses 12 21 6 4 7 10

7. ANALYSIS OF WETHER PEOPLE WOULD PAY MORE FOR THEIR

FAVOURITE COLOUR

Blue Black Red Grey Others

YES 9 17 2 3 7

NO 3 12 3 1 3

People said they won’t mind paying extra money for the motorcycle provided they get the

colour which they prefer the most and even said that for an economy segment bike it’s not

worth it, for a premium segment bike they can still think about it.


8. WOULD CUSTOMERS GO FOR A LOAN PAYMENT FOR PURCHASING AN

ECONOMY SEGMENT MOTORCYCLE?

Preference of loan payment

YesNoMaybe

YES NO MAYBE

16 42 2

The respondents said they will certainly go for a down payment because less than 50,000

Rs is too small an amount to go for loan as they will end up paying a lot of interest and it

is too cumbersome as it involves a lot of time and paperwork.

9. IMPORTANCE OF RESALE VALUE BEHIND THE PURCHASE DECISION


Importance of Resale value

YesDoes not matterMaybe

YES Does not matter Maybe

32 24 4

The ratio of resale value is 4:3 as people develop an emotional attach with the bike so they

don’t think about selling it. But majority said its one important attribute before buying the

bike as they expect to get half the value after 4-5 years. (Depreciation of 10% every year)

10. ANALYSIS OF THE TIME AND TYPE OF SERVICE

Most of the individuals get their motorcycles serviced by authorised dealers once in 2-3

months (2000kms) odd and opt for Routine general wash and service

11. WHICH CATEGORY OF MOTORCYCLE IS PREFERRED THE MOST


Category

Expensive with amazing looks and style & low mileageDecently sylish with economical price & good mileage

Majority of the people preferred the motorcycle with decent looks and good mileage because

of the following reasons

1. Prices of petrol are soaring high day by day.

2. Motorcycles are mostly bought by people for local conveyance and need of transport as

analysed before.

3. Economy segment motorcycles are bought considering mostly the Mileage attribute.

MEDIA

12. NEWSPAPER PREFERENCES


Newspapers

TOIPraja vani Kannada PrabhaDeccan Chronicle Deccan HeraldThe HinduBangalore MirrorHindi Patrika

TOI is read the most by the people followed by Praja Vani and Deccan Chronicle.

13. FAMOUS TV CHANNELS


TV Channels

SonyZee TVMTVChannel VNDTVTen SportsAaj TakSet MaxStar GoldSurya TVStar Plus

Sony, Star plus, NDTV, Channel V and Surya TV are the most watched TV channels

14. AWARENESS OF SOCIAL NETWORKING SITES

Social Networking Sites

OrkutFacebookGmailRediff MailYahooLinkd In

Facebook, Orkut and Gmail are the only networking sites respondents were aware of

moreover only the people dwelling in the urban areas are aware of social networking sites,

majority of the people in rural areas were not aware of it.


15. FAVOURITE TV COMMERCIAL OF MOTORCYCLES AND THE REASON

FOR ITS REMEMBERANCE.

1-Tvs Apache RTR – Theme background and latest vision.

2-Hero Honda Hunk-Teaser campaign (looks sturdy)

3-Hero Honda Splendor-Old classic advertisement.

4-Hero Honda Karizma – Because of Hrithik Roshan and Slogan “Desh Ki Dhadkan Dhak

Dhak go...”

5- Bajaj Pulsar- Stunts, the definitely male campaign.

6- Royal Enfield – Background appearances, Looks and style.

CONSUMER PERCEPTION ANALYSIS ON ECONOMY SEGMENT

MOTORCYCLES

16. RATING OF THE MOTORCYCLE BRANDS BASED ON TECHNICAL

SPECIFICATIONS.

Rating based on Technical specifications

YamahaHero HondaBajajSuzukiTVSHondaMahindra

Yamaha was preferred by the customers on the first place followed by Hero Honda and Bajaj.


17. RATING OF THE MOTORCYCLE BRANDS BASED ON LOOKS AND STYLE

Rating based on looks & style

Hero HondaYamahaBajajHondaTVSMahindraSuzuki

1- Hero Honda

2-Yamaha

3-Bajaj

4-Tvs

18. AWARENESS OF NEW FEATURES PRESENT IN MOTORCYCLES

1-Automatic indicators

2-puncture resistant tyres as in Honda Activa

3-Engine shield

4-Mobile Charger

5-Free gear start


Awareness

Automatic indicatorsPuncture resistant tyres Engine shieldMobile ChargerFree gear start

Your monthly Income?

i. Below Rs. 15000

ii. 15000-25000

iii. 25000-35000

iv. Above 35000

v. N/A

Table 5-3- Monthly IncomeMonthly Income % of Respondent

Below Rs. 15000 18

15000-25000 26

25000-35000 49

Above 35000 28

N/A 33


Below Rs. 1500012%

15000-2500017%

25000-3500032%

Above 3500018%

N/A21%

Monthly income

Figure 5-4 Monthly IncomeAnalysis:

From the data obtained through survey it can be analyzed that most of the respondent

belongs to the income group of Rs. 25000-35000 i.e. 32%. It shows that most of the

respondents are the working category people who majorly own a motorcycle; also it

includes the one who intend to buy a new one.

The second category of respondents is those who don’t have any income as such. They are

basically the student groups who are dependent on their parents and representing 21%. The

income group having income above Rs.35000 represents 18%. The income group below

Rs.15000 has the minimum representation.

Marital Status - Married ( ) Bachelor ( ) Tick mark the right option

Martial

Frequency Percent Valid Percent

Cumulative

Percent

Valid Married 83 29.9 29.9 29.9

Bachelor 178 70.1 70.1 100.0

Total 261 100.0 100.0


Married30%

Bachelor70%

Maritial

Analysis:

From the data obtained through survey it can be analyzed that most of the respondents are

Bachelor i.e. 70 percent of the total sample size and the remaining 30% is comprised of the

married respondents. This question would help to identify the difference between the buying

behaviours and spending patterns of both Married as well as Bachelor respondents in the

questions to come.

How old are you?

i. 18-25

ii. 26-30

iii. 31-35

iv. Above 36

Age


Cumulative

Percent

Valid 18-25 20 12.2 13.0 13.0

26-30 41 25.1 26.6 39.6

31-35 52 32.9 33.8 73.4

above 36 41 29.8 26.6 100.0

100.0

Total 154 100.0


18-2512%

26-3025%

31-3533%

Above36 30%

Age

Analysis:From the data obtained through survey it can be analyzed that most of the respondents are in

the age group of 31-35 i.e. 33% followed by the Above 36 age slab i.e. 30%. It clearly

indicates that the majority of the survey’s respondents are of mid-age, who apparently does

not want to spend more than Rs. 50,000 on a new motorcycle. This analysis can be supported

by the various cross tabulations which are performed keeping into consideration the change

in preferences and how they differ from every age-segment.

Do you own a motorcycle?

i) YES [ ]

ii) NO [ ]

Do you own a motorcycle


Cumulative

Percent

Valid No 65 42.2 42.2 42.2

yes 89 57.8 57.8 100.0

Total 154 100.0 100.0


No42%

Yes58%


Analysis:

From the data obtained through survey it can be analyzed that most of the respondents own a

motorcycle i.e. 58 percent whereas there are still 42 percent who do have one. This can be

considered as a potential market for the organization as most of the respondents who do not

own a motorcycle do intend to buy one in future.

age * Do you own a motorcycle Cross-tabulation


TotalNo Yes

age 18-25 9 11 20

26-30 16 25 41

31-35 22 30 52

above 36 18 23 41

Total 65 89 154


18-25 26-30 31-35 above 36age

0

5

10

15

20

25

30

35

Age*Do you own a motorcycle Crosstabbula-tion

NoYes

Analysis:

The given data above illustrates the Age and Do you own a motorcycle Cross-tabulation.

Clearly indicates that maximum number of people owning motorcycles lie in the age group of

31-35. This particular age group people identifies the target group which wants to invest in a

product that is good value for money and also economic in nature.

Do you intend to buy one in future?

I. YES [ ]

II. NO [ ]


No10%

Yes90%

Do you intend to buy one in future

Analysis:

From the data obtained through survey it can be analyzed that most of the respondents intend

to buy a new motorcycle, irrespective of whether they own one as of now or not. 90 percent

of the respondents want to buy a new motorcycle. This clearly addresses the demand in the

market. Now what is it that they look in for before buying a new motorcycle is to be

understood. There are few cross-tabulations that are performed, which would help to analyze

the relations and intentions of people from various age groups.


ANALYSIS OF OBJECTIVES

1. To examine whether income accounts for future purchasing preferences.

This objective can be analysed with the help of Cross Tabulation and the associated Chi-

Square value to assess if a relationship exists between two nominal scaled variables.

Case Processing Summary

Cases

Valid Missing Total

N Percent N Percent N Percent

Affordability * Future

purchase

261 100.0% 0 .0% 261 100.0%

Affordability * Future purchase Cross tabulation

Future purchase

TotalAffordability motorbike scooter electric bike can’t say don’t want

Less than 30000 Count 21 0 1 2 0 24

% within

Affordability

87.5% .0% 4.2% 8.3% .0% 100.0%

30001-40000 Count 28 6 2 2 0 38

% within

Affordability

73.7% 15.8% 5.3% 5.3% .0% 100.0%

40001-50000 Count 70 2 5 3 12 92

% within

Affordability

76.1% 2.2% 5.4% 3.3% 13.0% 100.0%

50001-60000 Count 29 0 1 7 0 37

% within

Affordability

78.4% .0% 2.7% 18.9% .0% 100.0%

60001-80000 Count 41 0 0 8 0 49

% within

Affordability

83.7% .0% .0% 16.3% .0% 100.0%

More than 80000 Count 21 0 0 0 0 21

% within

Affordability

100.0% .0% .0% .0% .0% 100.0%

Total Count 210 8 9 22 12 261


within Affordability

80.5% 3.1% 3.4% 8.4% 4.6% 100.0%

Chi-Square Tests

Value df Asymp.

Pearson Chi-Square 65.551a 20 .000

Likelihood Ratio 65.319 20 .000

Linear-by-Linear Association .634 1 .426

N of Valid Cases 261

The Chi-Square analysis is the examination of frequencies of two-nominal scaled variables in

cross tabulation to determine whether the variables have a relationship.

Less than 30000 30,001-40,000 40,001-50,000 50,001-60,000 60,001-80,000 More than 80,000

2128

70

29

41

21

06

2 0 0 01 25

1 0 02 2 37 8

00 0

12

0 0

Affordability to future purchaseMotorbike Scooter Electric Bike Can't say Don,t want

The case processing summary above clearly depicts that out of 300 respondents, 261

respondents who were intenders answered this question. The crosstab table above shows that


out of 261 respondents 210 respondents wanted to purchase a motorcycle in future that is

80.5% of the total intenders, the majority falls under the Rs 40,000-50,000 category.

The second table Chi-Square tests shows that at 95% significance level the value is less

than .05 which shows that there is a significant relationship between income and future

purchase.

2. To analyse various attributes considered by consumers while making their purchase.

KMO and Bartlett's Test

Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .497

Bartlett's Test of Sphericity Approx. Chi-Square 38.959

df 21

Sig. .010

The Kaiser-Meyer-Olkin measure of sampling adequacy should be between 0-1 and should

not be less than 0.5 so the table above shows the value of 0.497 there is a slight difference

which could be rectified if the sample size is more.

Total Variance Explained

Component

Factors

Initial Eigenvalues Extraction Sums of Squared Loadings Rotation Sums of Squared Loadings

Total

% of

Variance

Cumulative

% Total

% of

Variance

Cumulative

% Total

% of

Variance

Cumulative

%

1 1.345 19.209 19.209 1.345 19.209 19.209 1.235 17.637 17.637

2 1.175 16.781 35.990 1.175 16.781 35.990 1.142 16.321 33.958

3 1.083 15.471 51.460 1.083 15.471 51.460 1.129 16.133 50.091

4 1.011 14.439 65.900 1.011 14.439 65.900 1.107 15.809 65.900

5 .899 12.843 78.743

6 .771 11.010 89.752

7 .717 10.248 100.000

Extraction Method: Principal Component Analysis.


The screen plot graphs the Eigen-values against the factor number

Rotated Component Matrixa

Component

1 2 3 4

Factor price .729

Factor mileage .725

Factor looks&

style

.862

Factor

maintenance

.765

Factor resale .710

Factor

performance

.783

Factor safety .719


Extraction Method: Principal Component Analysis.

Rotation Method: Varimax with Kaiser Normalization.

The above table shows how the 7 factors are finally reduced to 4 factors which are the most

important factors in making the purchase decision. The Rotated Component Matrix shows

that in the first component- Factor mileage and Factor Maintenance can be grouped together

likewise in 2 component Factor performance and factor Safety.

In component 4 looks and style shows a value of 0.862 which shows that looks and style is

the most preferred and important attribute taken into consideration before buying a

motorcycle followed by Performance ,Maintenance and Mileage.

3. To determine the consumer perception and choice towards different motorcycle

brands and also determine the most preferred motorcycle in the economy

segment.


TVSSTARCITY


Cumulative

Percent

Valid NA 64 39.0 41.6 41.6

MOST PREFERRED 21 12.8 13.6 55.2

PREFERRED 16 9.8 10.4 65.6

NEUTRAL 17 10.4 11.0 76.6

LEAST PREFFERED 16 9.8 10.4 87.0

NOT PRFERRED 20 12.2 13.0 100.0

Total 154 93.9 100.0

Missing System 10 6.1

Total 164 100.0

TVSSPORT


Cumulative

Percent

Valid NA 145 88.4 94.2 94.2

PREFERRED 4 2.4 2.6 96.8

NEUTRAL 1 .6 .6 97.4

NOT PRFERRED 4 2.4 2.6 100.0

Total 154 93.9 100.0


Total 164 100.0

TVSJIVE


Cumulative

Percent

Valid NA 153 93.3 99.4 99.4

NOT PRFERRED 1 .6 .6 100.0

Total 154 93.9 100.0


Total 164 100.0


HEROHONDASPLENDOR100


Cumulative

Percent

Valid NA 95 57.9 61.7 61.7


PREFERRED 16 9.8 10.4 79.2

NEUTRAL 13 7.9 8.4 87.7


NOT PRFERRED 9 5.5 5.8 100.0

Total 154 93.9 100.0


Total 164 100.0

HEROHONDASPLENDORNXG


Cumulative

Percent

Valid NA 145 88.4 94.2 94.2


PREFERRED 3 1.8 1.9 97.4

NEUTRAL 2 1.2 1.3 98.7

LEAST PREFFERED 1 .6 .6 99.4

NOT PRFERRED 1 .6 .6 100.0

Total 154 93.9 100.0


Total 164 100.0


HEROHONDAPASSIONPRO


Cumulative

Percent

Valid MOST PREFERRED 47 28.7 30.5 30.5

PREFERRED 50 30.5 32.5 63.0

NEUTRAL 39 23.8 25.3 88.3


NOT PRFERRED 3 1.8 1.9 100.0

Total 154 93.9 100.0


Total 164 100.0

HEROHONDACDDELUXE


Cumulative

Percent

Valid NA 123 75.0 79.9 79.9


PREFERRED 6 3.7 3.9 87.0

NEUTRAL 9 5.5 5.8 92.9


NOT PRFERRED 6 3.7 3.9 100.0

Total 154 93.9 100.0


Total 164 100.0


HEROHONDACDDAWN


Cumulative

Percent

Valid NA 75 45.7 48.7 48.7


PREFERRED 12 7.3 7.8 62.3

NEUTRAL 13 7.9 8.4 70.8


NOT PRFERRED 23 14.0 14.9 100.0

Total 154 93.9 100.0


Total 164 100.0

BAJAJDISCOVER100


Cumulative

Percent

Valid NA 80 48.8 51.9 51.9


PREFERRED 8 4.9 5.2 64.3

NEUTRAL 17 10.4 11.0 75.3


NOT PRFERRED 20 12.2 13.0 100.0

Total 154 93.9 100.0


Total 164 100.0


BAJAJDISCOVER125


Cumulative

Percent

Valid NA 79 48.2 51.3 51.3


PREFERRED 9 5.5 5.8 75.3

NEUTRAL 8 4.9 5.2 80.5


NOT PRFERRED 8 4.9 5.2 100.0

Total 154 93.9 100.0


Total 164 100.0

BAJAJPLATINA


Cumulative

Percent

Valid NA 120 73.2 77.9 77.9


NEUTRAL 4 2.4 2.6 86.4


NOT PRFERRED 3 1.8 1.9 100.0

Total 154 93.9 100.0


Total 164 100.0


HONDACBTWISTER110


Cumulative

Percent

Valid NA 81 49.4 52.6 52.6


PREFERRED 11 6.7 7.1 61.7

NEUTRAL 16 9.8 10.4 72.1


NOT PRFERRED 22 13.4 14.3 100.0

Total 154 93.9 100.0


Total 164 100.0

SUZUKISLIGSHOT


Cumulative

Percent

Valid NA 123 75.0 79.9 79.9


PREFERRED 5 3.0 3.2 85.1

NEUTRAL 6 3.7 3.9 89.0

LEAST PREFFERED 1 .6 .6 89.6

NOT PRFERRED 16 9.8 10.4 100.0

Total 154 93.9 100.0


Total 164 100.0


YAMAHAYBR110


Cumulative

Percent

Valid NA 133 81.1 86.4 86.4

PREFERRED 7 4.3 4.5 90.9

NEUTRAL 7 4.3 4.5 95.5


NOT PRFERRED 4 2.4 2.6 100.0

Total 154 93.9 100.0


Total 164 100.0

YAMAHASS125


Cumulative

Percent

Valid NA 133 81.1 86.4 86.4

PREFERRED 5 3.0 3.2 89.6

NEUTRAL 4 2.4 2.6 92.2


NOT PRFERRED 8 4.9 5.2 100.0

Total 154 93.9 100.0


Total 164 100.0


Hero Honda CDDawn7%

HeroHonda Splendor

40%

Hero Honda Splendor plus

19%

Bajaj Discover 10017%

TVS StaR City 17%

Most Preferred Economy Segment Motocycle

Analysis:

As per the data obtained and analyzed on the basis of the mean ranks given by the

respondents to their most preferred economy segment motorcycle amongst the given list in

the questionnaire, the following conclusion can be drawn. The above listed motorcycles in

the pie-chart are the most preferred economy segment motorcycles in the market as of now.

1. Hero Honda Splendor

2. Hero Honda Splendor plus

3. TVS StaR City

4. Bajaj Discover 100

5. Hero Honda CD Dawn

4. To analyse the impact of demographic factors on choosing a two-wheeler and specific

brands of motorcycles.


Marital * Future purchase

Crosstab

Future purchase

Totalmotorbike scooter electric bike can’t say don’t want

Marital bachelor Count 155 1 4 14 7 181

% within Marital 85.6% .6% 2.2% 7.7% 3.9% 100.0%

married Count 55 7 5 8 5 80

% within Marital 68.8% 8.8% 6.3% 10.0% 6.3% 100.0%

Total Count 210 8 9 22 12 261

% within Marital 80.5% 3.1% 3.4% 8.4% 4.6% 100.0%

Married Bachelor Total0

50

100

150

200

250

motorbikescooterelectric bikecan’t saydon’t wantTotal

Out of the total respondents who were intenders 181 were Bachelors and 60 were married.

210 respondents wanted to buy a motorcycle in future that is 80.5 % of the total respondents.

Age * Future purchase


Crosstab

Future purchase

Totalmotorbike scooterelectric

bike can’t saydon’t want

age 18-25 Count 34 1 0 3 0 38

% within age 89.5% 2.6% .0% 7.9% .0% 100.0%

26-30 Count 68 4 2 8 5 87

% within age 78.2% 4.6% 2.3% 9.2% 5.7% 100.0%

31-35 Count 65 0 6 7 4 82

% within age 79.3% .0% 7.3% 8.5% 4.9% 100.0%

above 36 Count 43 3 1 4 3 54

% within age 79.6% 5.6% 1.9% 7.4% 5.6% 100.0%

Total Count 210 8 9 22 12 261

% within age 80.5% 3.1% 3.4% 8.4% 4.6% 100.0%

18-25 26-30 31-35 above 36 Total0

50

100

150

200

250

motorbikescooterelectric bikecan’t saydon’t wantTotal

The above Cross tabulation shows that maximum number of intenders fall under the age

group of 26-35 years out of which the majority wants to buy a motorcycle in future.


Marital * Two-wheeler

Crosstab

Two-wheeler

TotalHero

Honda Bajaj TVSHond

a Suzukiroyal

EnfieldMahindr

aYamah

a others

Marital bachelor 67 45 31 20 4 4 0 8 2 181

37.0% 2.5E1%

1.7E1%

1.1E1%

2.2% 2.2% .0% 4.4% 1.1% 100.0%

married 19 26 8 18 2 2 2 0 3 80

23.8% 3.3E1%

1.0E1%

2.3E1%

2.5% 2.5% 2.5% .0% 3.8% 100.0%

Total 86 71 39 38 6 6 2 8 5 261

33.0% 2.7E1%

1.5E1%

1.5E1%

2.3% 2.3% .8% 3.1% 1.9% 100.0%

Bachelor Married Total0

50

100

150

200

250

300

Hero HondaBajajTVSHondaSuzukiroyal EnfieldMahindraYamahaothersTotal

In the above Cross Tabulation it shows that out of 181 respondents who were bachelors 67

prefer Hero Honda, 45 prefer Bajaj and 31 prefer TVS. This shows that majority of the


bachelors prefer Hero Honda over the other brands. Out of 80 married respondents 26 prefer

Bajaj, 19 prefer Hero Honda and 18 prefer Honda.

Cross Tabulation of Age * Two-wheeler

Two-wheeler

TotalHero

Honda Bajaj TVS Honda SuzukiRoyal

Enfield Mahindra Yamaha others

Age 18-25

14 7 6 8 0 1 1 1 0 38

36.8% 18.4% 15.8% 21.1% .0% 2.6% 2.6% 2.6% .0% 1.0E2%

26-30

27 30 9 10 5 2 0 1 3 87

31.0% 34.5% 10.3% 11.5% 5.7% 2.3% .0% 1.1% 3.4% 1.0E2%

31-35

29 22 15 9 1 1 1 4 0 82

35.4% 26.8% 18.3% 11.0% 1.2% 1.2% 1.2% 4.9% .0% 1.0E2%

above 36

16 12 9 11 0 2 0 2 2 54

29.6% 22.2% 16.7% 20.4% .0% 3.7% .0% 3.7% 3.7% 1.0E2%

Total 86 71 39 38 6 6 2 8 5 261

33.0% 27.2% 14.9% 14.6% 2.3% 2.3% .8% 3.1% 1.9% 1.0E2%


Crosstab

18-25 26-30 31-35 Above 36 Total0

50

100

150

200

250

300

Hero HondaBajajTVSHondaSuzukiRoyal EnfieldMahindraYamahaothersTotal

From the above Cross tabulation it can be analysed that the majority of the intenders fall

under the age group of 26-35 years and prefer Hero Honda, Bajaj and TVS respectively.

Marital * Showrooms Cross tabulation

Count

Showrooms

Total1showroom 2 showrooms 3 showrooms

more than 3

showrooms

twice the

same others

Marital bachelor 49 47 38 44 1 2 181

married 31 30 9 10 0 0 80

Total 80 77 47 54 1 2 261

The above table shows that 76% of the bachelors visit one or two showrooms before buying a

motorcycle whereas only 68% of the married respondents visit 1 or two showrooms on the

other hand only 24% bachelor’s visit more than 3 showrooms and hardly 11 % of the married

respondents visit more than 3 showrooms.


The above table shows that respondents under the age group of 26-30 years have chosen all

the options of visiting the showroom , the majority chooses to visit only one or two

showrooms before buying the motorcycle and the majority is above the age of 30 years.

There are only 2 respondents who chose to visit the same showroom again.

Age * Information Cross tabulation

Count

Information

Total

newspapers/

magazines TV/radio internet family/friends

bill boards/

pamphlets others

age 18-25 22 2 2 10 1 1 38

26-30 60 4 11 10 2 0 87

31-35 53 6 6 12 2 2 82

above 36 29 4 8 10 3 0 54

Total 164 16 27 42 8 3 261

The above table displays out of 261 respondents 164 have collected the information about motorcycles before making the purchase decision from newspapers and magazines as it is one of the cheapest and easiest available option from the view point of customers.


Age * Showrooms Cross tabulation

Count

Showrooms

Total1showroom 2 showrooms 3 showrooms

more than 3

showrooms

twice the

same others

age 18-25 8 17 8 5 0 0 38

26-30 28 21 20 17 0 1 87

31-35 23 24 13 20 1 1 82

above 36 21 15 6 12 0 0 54

Total 80 77 47 54 1 2 261

5. To understand the impact of media on consumer buying behaviour and also zero in

the most suitable means to promote the brand and products

No36%

Yes64%

Newspaper/Magazines

TV/Radio


Cumulative

Percent

Valid 0 103 62.3 62.3 62.3

1 158 37.7 37.7 100.0

Total 261 100.0 100.0


Newspaper/Magazines


Cumulative

Percent

Valid 0 56 36.4 36.4 36.4

1 98 63.6 63.6 100.0

Total 261 100.0 100.0

No62%

Yes38%

TV/Radio

Internet


Cumulative

Percent

Valid 0 122 79.2 79.2 79.2

1 32 20.8 20.8 100.0

Total 154 100.0 100.0

No79%

Yes21%

Internet

Family/Friends


Cumulative

Percent

Valid 0 98 63.6 63.6 63.6

1 56 36.4 36.4 100.0

Total 154 100.0 100.0


No64%

Yes36%

Family/Friends

Bill Board/Pamphlets


Cumulative

Percent

Valid 0 140 90.9 90.9 90.9

1 14 9.1 9.1 100.0

Total 154 100.0 100.0

No91%

Yes9%

Bill Board/Pamphlets


Others


Cumulative

Percent

Valid 0 137 89.0 89.0 89.0

1 17 11.0 11.0 100.0

Total 154 100.0 100.0

No89%

Yes11%

Others

Analysis:

When we talk about the importance of media in influencing the consumer buying behaviour,

Newspapers/Magazines are still the most cherished and desired source of information and

food for thought for the consumers. Although, it is a conventional mode, however keeping

the Indian audience in mind Newspapers/Magazines are the best source to advertise the

products. It is followed by TV/Radio, which means there is a large scope for advertisements

and promotions in this particular mode to increase the public awareness. Often, it happens

that a product has every possible thing that it needs to become a success; however it still dies

a short lived death due to the lack of appropriate promotion strategies adopted by the

organization.

Family and Friends also play a major role these days in influencing consumer’s buying

decision. This purely works on Word-To-Mouth Marketing, and companies can design some

innovative strategies for Word-To-Mouth Communication. However, this still remains a


secondary source of media that influences consumers. Internet has taken a major leap last

couple of years, and youth is glued to the social networking sites most of the time.

5 FINDINGS

The primary objective of the study was to “Investigate consumer attitude, perception and

buying behaviour towards the economy segment motorcycles in the domestic market.”

As I carried on with the research, the analysis performed has helped to reach out to the

desired out. To understand the consumer behaviour, an exploratory research was performed,

to understand the market scenario. Based on the facts procured and keeping the primary data

into consideration, the following secondary objectives were chalked out:

To determine the consumer perception and choice towards different motorcycle

brands and also determine the most preferred motorcycle in the economy

segment.

To analyze various attributes consumers look for while making their purchase

To examine whether income accounts for future purchasing preferences.

To understand the impact of media on consumer buying behaviour and also zero

in the most suitable means to promote the brand and products

The survey was conducted amongst 261 respondents keeping the target audience into

consideration.

The responses were taken exclusively from the males in and around the Bangalore city.

The average income of the sample size lies between Rs.10000-20000 per month which is

appropriate for the target group being worked upon for this particular research which is

confined to understand the consumer buying behaviour for economy segment motorcycles

in the domestic market.


70% of the sample size is bachelor whereas 30% is married. A proper cross-tabulation has

been done for respondents from both the categories, to understand the opinion and

attitude of both the groups when it comes to consumer buying behaviour.

Demographic vitals play an important role to understand the consumer behaviour. Age

being one of the most important parameter, majority of the sample size belongs to the age

group of 30 and above. This particular target group synchronizes with the income they earn,

and are willing make an economical investment, clearly, defining the demand in the market

for economy segment motorcycles.

Around 58% of the sample size owns a motorcycle. When cross-tabulated with the age and

income they earn, people in the age group of 30 and above are the ones who own have a

majority amongst the other age group.

When surveyed, around 90% of the respondents are intending to buy a new motorcycle,

irrespective of already owning one.

When cross-tabulated age with are you intending to buy a new motorcycle, majority of the

responses were from the age group of 31 and above, irrespective, of already owning one.

Keeping the Indian social scenario in mind, this particular age group either belongs to the

working class or rural business class, who when asked during the exploratory research,

would only invest in something that is a good value for money, low on maintenance, and

does not dig a hole in their pockets with the price tag.

This particular analysis, clarifies that there is a massive demand for economical segment

motorcycles in the market, the key is to identify the target audience well and position the

products in such a way that the consumer is left with no other option but to go for it.

Talking about the most preferred two-wheeler category in the market, without any doubt it

has to be a motorcycle, with almost 85% of the respondents prefer to buy a motorcycle over

any other format of a two-wheeler.

A consumer will spend money on something only if he seeks value out of it. Majority of the

respondents are willing to spend somewhere around Rs.40, 000-50,000 for buying a new

motorcycle. A perfect fit for economy segment motorcycles. It can also be interpreted, that


if people would want to buy a new motorcycle, they will mostly buy an economy segment

motorcycle. On the other hand, there is still a good demand of motorcycles ranging from Rs.

60,000-80,000 as there are some amazing brands available in the executive segment as well.

Age and spending cross-tabulation identified that the target group of the research is the one

with majority who is willing to spend Rs. 40,000-50,000 for a new motorcycle. Thus, it

explains the purchasing pattern of the consumers, i.e. how much are they willing to spend.

Talking about the brand they have used, and brand they recognize, hero Honda stands tall

with maximum number of responses, followed by Bajaj and TVS. On the contrary, Yamaha

and Honda have also started creating a buzz in the market with most of the youngsters

following the brand and recognizing its motorcycles on the road and advertisements.

When we talk about the importance of media in influencing the consumer buying

behaviour, Newspapers/Magazines are still the most cherished and desired source of

information and food for thought for the consumers. Although, it is a conventional mode,

however keeping the Indian audience in mind Newspapers/Magazines are the best source

to advertise the products.

It is followed by TV/Radio, which means there is a large scope for advertisements and

promotions in this particular mode to increase the public awareness. Often, it happens that

a product has every possible thing that it needs to become a success; however it still dies a

short lived death due to the lack of appropriate promotion strategies adopted by the

organization.

Family and Friends also play a major role these days in influencing consumer’s buying

decision. This purely works on Word-To-Mouth Marketing, and companies can design some

innovative strategies for Word-To-Mouth Communication. However, this still remains a

secondary source of media that influences consumers.

Internet has taken a major leap last couple of years, and youth is glued to the social

networking sites most of the time. Perhaps, a great opportunity and potential consumer

base waits on the sites to be flooded with promotions and information.


To analyze various attributes consumers look for while making their purchase, the entire

data of 261 respondents was segregated into two divisions.

First, the respondents who do not own a motorcycle and intend to buy one. Their responses

have been recorded and analyzed separately. The attribute with the least mean is the one

that is preferred the most. In this case, Mileage (2.38) is the attribute which has been

ranked 1 by the respondents who do not own a motorcycle and intend to buy one. Mileage

plays an important role in influencing a consumer’s buying decision.

Mileage is followed by Price (3.65) is the second most preferred attribute by the

respondents who do not own a motorcycle and intend to buy one. Similarly Looks & Style

(4.77) stand at number 3, when it comes to the preference of consumers according to the

attribute.

People in the age group of above 36 have a very stable and calm approach when they go

ahead to buy a new bike. Majority of them just visit one showroom and make their decision,

whereas, young people in the age group of 18-25 find it difficult to come to a decision by

visiting one showroom, therefore, they end up visiting two or maximum 3 showrooms to

make their final decision.

With the help of factor analysis, it was figured out that there are three major components

that accounts for the most important attributes in an economy segment motorcycle. Since

they have been conglomerated a specific name can be defined for these three components

and they can be used during the New Product Development (NPD) and be prioritised

according to the needs and demands in the market.

So, these components can be worked upon collectively or individually and probably can be

useful for the organization as they go on with their marketing plans and design new

strategies for the same.

As per the data obtained and analyzed on the basis of the mean ranks given by the

respondents to their most preferred economy segment motorcycle amongst the given list in

the questionnaire, the following conclusion can be drawn. The above listed motorcycles in

the pie-chart are the most preferred economy segment motorcycles in the market as of

now.


Hero Honda Splendor

Hero Honda Splendor Plus

TVS StaR City

Bajaj Discover 100

Hero Honda CD Dawn

Therefore, all objectives have been met keeping into consideration all the aspects, i.e.

social, demographic and perception of the sample size.


6 RECOMMENDATIONS

The research undergone simplifies a lot of ambiguity about the market and its dynamics in

today’s scenario. There is always a demand for a good product in the market. Consumers are

generally not aware of what they are consuming. We can term it as the pompous tradition of

the marketers, to keep the consumers blindfolded and flooding them with loads of options

always so that they remain confused and keep downing whatever comes their way.

However, TVS as an organization differs from the above statement. Although the letters

TVS represent the initials of our founder, T V Sundaram lyengar, to us within TVS they have

always stood for Trust, Value and Service.

TVS enjoys an esteemed reputation in the Indian market and is known for its commitment,

the company must leverage on this fact and flood the market with such economical segment

products which caters the need of the masses and also satisfies them.

During the exploratory research phase of the project, I observed that people in South India

prefer a TVS motorcycle over any other eminent brand available in the market. Call it

nepotism of soil or probably the proximity from the manufacturing unit, this does brings TVS

motor into an advantageous position over the competitors. However, the irony is there has

been no product differentiation as of now, which needs to be worked upon, by probably fine-

tuning some selling strategies or the promotion strategies.

TVS StaR City is a famous motorcycle in the economy segment, and it is giving a cut-throat

competition to the legacy of Hero Honda Splendor. It has been able to change the perception

of people about the most reliable motorcycle after Hero Honda Splendor. However,

consumers are still unaware about TVS Sport. It has happened a lot of times when the

greatest of the products just die as they fail to appeal the audience. An appropriate addressing

of the audience is required and thus positioning it to the right audience is extremely

important.

According to the analysis, the target group is majorly an audience which is in the age group

of 30-40 years, partly working class and partly rural business class, earning not more than

25000-35000 rupees per month. There requirements are minimal and they believe in true


value for money. Certain areas can be worked upon like, Mileage and Price. If these two

attributes are addressed to the correct audience with proper positioning and continuous

promotions, a lot of difference can be made. One particular brand can become a flagship

brand for the whole organization, just like TVS Apache.


7 CONCLUSION

The research was performed to understand and analyze the consumer behaviour towards the

economy segment motorcycles in the domestic market. The automobile market is massive

with lots of R&D and NPD going on every day. In a country like India, two-wheelers are the

life-line of Indian household. This study helped in understanding the market and also the

opportunities that lies ahead for the companies.

The research was started with an aim to achieve the desired objectives. Nothing was pre-

defined and it had to start from a scratch. Lot of secondary data was collected and analysed.

Based on that, an exploratory research program was designed. A questionnaire was drafted, in

order to get a general opinion of the respondents. Based on the responses, certain parameters

were chalked-out. For example: preferences of consumers, identification of the target group,

expectations and scope of the study.

With the analysis of the exploratory data, and the guidance of our industry and faculty guides,

a final close ended questionnaire was drafted, keeping into consideration the target group and

their preferences that they are aware of. The survey was carried out pan Bangalore and some

rural areas like anekal and attible, overall, the consumer behaviour research really teaches

one the physiology of the consumers when we interact with them and record their reactions

and demeanour with the flow of questions as well as the time consumed on each

questionnaire. All these enactments of the respondents accounts to the consumer behaviour

which apparently cannot be quantified.

After a thorough assessment of the data collected, it was compiled in the excel format and

thus uploaded on SPSS for the analysis. Various tests were performed and each and every

particular question was analysed in order to reach the desired objective. Cross-tabulations

helped a lot in identifying a relation between the given data, which eventually elucidated a lot

of ambiguity regarding the consumer’s buying preference. Being on the field and observing

things were different when they were analyzed on the computer screen, however, the connect

was made, and the objective to understand and determine the behaviour, attitude and

perception was identified fruitfully.


8 LEARNING OUTCOME

Consumer behaviour however, is a vast ocean and is a never ending learning process. Never

the less, this project brought me closer to the ground reality of the market and its dynamics.

From being a layman to the industry and finally ending up doing a consumer behaviour

research for the same has definitely, broaden my learning curve and also the ability to adapt

and work in the new environment. All in all, TVS experience was enriching as well as

tiresome too. Reaching out to random people, breaking the ice, convincing them to give their

responses was not as easy as expected; however, it did help me improve my interpersonal

skills.

A snapshot of learning outcome:

1. Working dynamics and characteristics of TVS Motor Company Ltd.

2. Understand the consumer buying behaviour and buying pattern.

3. Sales and Promotion practises adopted by TVS Motor Company Ltd.

4. Insights of Two-Wheeler industry.

5. Able to relate the theories studied (in marketing) to what is being practised in the industry.


9 BIBLIOGRAPHY

http://www.tvsmotor.in/

http://www.visiontraininginstitute.com.au/Media/DocumentLibrary/

http://www. tvs iyengar.com//

www.ibef.org

www.cii.com

www. scribd .com/

www. amazon .com/

www.google.co.in


http://www.google.co.in/

http://www.amazon.com/

http://www.scribd.com/

http://www.cii.com/

http://www.tvsiyengar.com//

http://www.visiontraininginstitute.com.au/Media/DocumentLibrary/

http://www.tvsmotor.in/

10 ANNEXURE

ANNEXURE I

QUESTIONNAIRE

NAME:

AGE:

OCCUPATION:

INCOME LEVEL PER ANNUM: a) 30000-45000 b) 46000-60000 c) 61000-75000 d)

76,000-100000 e) 100000 and above

QUES:) Do you own a motorcycle?

a) Yes b) No

QUES:) Which brand of motorcycle do you own?

a) Hero Honda

b) Bajaj

c) TVS

d) Others


QUES:) How old is your bike?

a) Less than 1 yearb) 1 to 3 yearsc) 3 to 5 yearsd) More than 5 years

QUES:) What motivated you to purchase your current motorcycle?

a) Advertisements

b) Family & friends

c) Brand Affinity

d) Word-of-Mouth

e) Peer Pressure

f) Others

QUES:)What was your top-most priority when you purchased your motorcycle Please rate

them out of 1 to 5?

a) Fuel efficiency

b) Looks and style

c) Performance

d) Mileage

e) Brand Image

f) Maintenance cost

QUES:) What is the current mileage of your motorcycle?

Please specify ( ) Kms/litre

QUES:) How do you measure the mileage of your motorcycle?

a) Approximationb) Resetting the meter


QUES:) Are you satisfied with the mileage of your bike?

a) Yesb) Noc) Maybe

QUES:) If no what is the reason?

a) More than one user b) Over-promise by the companyc) Over-Weight d) Bad Quality of tyrese) Poor Shock-Absorbersf) Others ( ) please specify

QUES:) What price segment does your motorcycle fall in?

a) Low price ( 35,000 - 40,000 )

b) Medium price ( 40,000 – 55,000 )

c) High price ( 55,000 and above )

QUES:) What Price did you intend to spend on your bike?

a) 35,000 -40,000b) 40,000 -55000c) 55000 and above

QUES:) What is the colour of your motorcycle?

Please specify ( )

QUES:) Did you request the dealer for the colour?

a) Yes

b) No

QUES:) How many service centers do you know for your motorcycle?

a) 0

b) 1


c) 2

d) 3

QUES:) How often your motorcycle needs services and maintenance?

a) After every 1 month

b) After every 2 months

c) After every 3 months

d) More than 3 months

QUES:) What kind of service do you generally opt for?

a) Over-all serviceb) Carburettor and Air-filter wash c) Engine Oil replacement d) Air pressure and alignment e) General wash and oilingf) Others

QUES:) What is the approximate cost of services and maintenance that you spend every

year?

Please specify Rs. ( )

QUES:) Do you think the maintenance cost is high?

a) Strongly disagreeb) Disagreec) Neutrald) Agreee) Strongly agree

QUES:) If, strongly agree, then what is the reason?

a) Frequent Foot peg problem b) Poor Quality of tyre and tubesc) Poor shock absorbers


d) Clutch handling probleme) Frequent Lightning and horn problemsf) Frequent Battery and spark plug problemsg) Accelerator wire displacement issuesh) Others

QUES:) Which type of service centers you use?

a) Authorized Service Station

b) Local Service Station

c) Depending upon situation

QUES:) What is the reason for such a decision?

a) Cost

b) Availability

c) Reliability

QUES:) What engine does your motorcycle has?

a) DTSi engine

b) CVTi engine

c) I don’t know

QUES:) Mark Yes if your motorcycle has

a) Twin sparksb) Carburetored enginec) Digital speedometerd) Halogen bulbse) Disc brakesf) High resolution stickersg) Electric automatic self starth) Alloy wheelsi) Puncture resistant tyres


QUES:) What do you like the most about your bike?

a) Styleb) Looksc) Comfortd) Performancee) Mileagef) others

QUES:) Is there anything which you don’t like in your bike?

( ) Please specify

QUES:) What is the impact of different types of media while purchasing a motorcycle?

a) High Impact

b) Medium Impact

c) Low Impact

QUES:) Do u think it’s important?

a) Yes b) Noc) Maybe

QUES:) Rank the following media options according to your preference?

a) Newspapersb) Magazinesc) Brochuresd) Posterse) Hoardingsf) Billboardsg) Televisionh) Radio & F.Mi) Internetj) Flyersk) Others ( ) Please specify


QUES:) Rank the following newspapers according to your convenience?

a) Times of Indiab) Hindustan Timesc) The Hindud) Deccan Heralde) Economic Timesf) Statesmang) Indian Expressh) The Telegraph

QUES:) Rank the following magazines according to your preference?

a) Filmfare magazineb) Woman’s era magazinec) Femina magazined) Front line magazinee) India today magazinef) Outlook magazineg) The Week magazineh) Overdrive magazinei) Top gear magazinej) The 4 P’s magazinek) Others ( ) Please specify

QUES:) Rank the following Television channels according to your preference?

a) NDTV b) MTVc) CHANNEL [V]d) STAR SPORTSe) STAR CRICKETf) TEN SPORTSg) ESPNh) SONYi) SET MAXj) STAR PLUSk) ZEE TVl) DISCOVERY

QUES:) What programs do you love watching on television?

( ) Please specify with a reason

QUES:) Mark Yes to all the social networking sites you are associated with?


a) Facebookb) Twitterc) My spaced) Orkute) Ibibof) Tribe.Netg) WAYNh) Hi 5i) Yahooj) Gmailk) Rediffl) Others ( ) Please specify

QUES:) In 24 hours how much time do you spend on the following media?

Please specify the time spent

a) Print media(newspapers , magazines etc ) [ ] hours [ ] minutesb) Electronic media ( TV, Radio , Internet etc ) [ ] hours [ ] minutesc) Social media ( word of mouth etc) [ ] hours [ ] minutes

QUES:) Do you recall coming across a Motorcycle commercial in the past month?

a) Yes

b) No

QUES:) What makes you remember the commercial?

a) The Brand ambassadorb) The Jinglec) The slogan and Taglined) The appearances and characters of the advertisemente) The themef) The message deliveredg) Others ( ) Please specify

QUES:) Which advertisement comes in your mind when you think about motorcycles ?

( ) Please specify

QUES:) Have you ever disliked any motorcycle advertisement, Please answer giving a

specific reason to why you did not like it?


( )

QUES:) Do you think resale value is also a parameter behind the purchasing decision?

a) Yesb) Noc) Maybe

QUES:) Please mark yes if you are aware of the following brands of motorcycles?

a) Hero Honda [ ]

b) TVS [ ]

c) Bajaj [ ]

d) Yamaha [ ]

e) Honda [ ]

f) Royal Enfield [ ]

g) Mahindra [ ]

h) Suzuki [ ]

QUES:) Please rank each brand in terms of your preference (place 1 by your first choice, 2 by

your second choice and so on).

a) Hero Honda

b) TVS

c) Bajaj

d) Yamaha

e) Honda


f) Royal Enfield

g) Mahindra

h) Suzuki

QUES:) Are you aware of the Economy segment motorcycles?

a) Yesb) Noc) Maybe

QUES:) Mark yes if you have heard, seen or driven the following bikes?

a) TVS STAR CITY 110b) TVS SPORTS 100c) TVS JIVE 110d) HERO HONDA SPLENDOR 100e) HERO HONDA SPLENDOR NXGf) HERO HONDA PASSION PLUSg) HERO HONDA PASSION PROh) HERO HONDA CD DAWNi) HERO HONDA CD DELUXEj) BAJAJ DISCOVER 100k) BAJAJ DISCOVER 125l) BAJAJ PLATINAm) HONDA CB TWISTER 110n) SUZUKI SLING SHOT 125o) YAMAHA YBR 110p) YAMAHA SS 125q) MAHINDRA STALLIO 110

QUES :) Rate out of 1 to 5(place 5 by your best choice, 4 by your second choice and so on)

TAKING THE ABOVE MENTIONED BIKES INTO CONSIDERATION.

PARAMETERS HERO

HONDA

BAJAJ TVS HONDA SUZUKI MAHINDRA YAMAHA

Price


Reliability

Comfort

Mileage

Style

Resale Value

Technology

Color

Safety

Looks

QUES:) Please rate TVS star city and sports by checking the line that best corresponds to

your evaluation of each item listed?

TVS STAR CITY

Slow pickup_ _ _ _ _ Fast pickup

Bad design _ _ _ _ _ Good design

Low price_ _ _ _ _ High price

Low maintenance cost _ _ _ _ _ High maintenance cost

Low mileage _ _ _ _ _ High mileage

TVS SPORTS

Slow pickup_ _ _ _ _ Fast pickup

Bad design _ _ _ _ _ Good design

Low price_ _ _ _ _ High price

Low maintenance cost _ _ _ _ _ High maintenance cost

Low mileage _ _ _ _ _ High mileage


QUES:) How did you buy you motorcycle?

a) Cash paymentb) Loan from the bankc) Gift from family or friendsd) Others ( ) Please specify

QUES: Please justify the above answer?

( )

QUES :) If you got your motorcycle financed ( loan from the bank ) how much did you pay

each month?

a) Rs. 1000-1500b) Rs. 1600-2000c) Rs. 2100-2500d) Rs. 2600 and above

QUES:) Are TVS star city and TVS Sports TV and Print commercials appealing?

a) Strongly disagreeb) Disagreec) Neutrald) Agreee) Strongly agree

QUES) If you strongly disagree, what makes you feel that the commercials are not

appealing?

( )


QUES:) Rate out of 1 to 5 on technical specifications (place 5 by your best choice, 4 by your

second choice and so on) REFER TO THE MOTORCYCLES OF THE ECONOMY

SEGMENT MENTIONED ABOVE ( TVS star city , Hero Honda splendor and passion,

Bajaj discover , Suzuki sling shot, Honda CB twister, Mahindra stallion in specific ).

PARAMETER

S

HERO

HONDA

BAJAJ TVS HONDA SUZUK

I

MAHINDRA YAMAHA

Engine

Power

Ignition

Brakes

Ground

Clearance

Fuel Capacity

Wheel Base

Seat Height

Battery

Weight

QUES:) Rate out of 1 to 5 on style (place 5 by your best choice, 4 by your second choice and

so on) REFER TO THE MOTORCYCLES OF THE ECONOMY SEGMENT MENTIONED

ABOVE (TVS star city , Hero Honda splendor and passion, Bajaj discover , Suzuki sling

shot, Honda CB twister, Mahindra stallion in specific ).


PARAMETER

S

HERO

HONDA


I

MAHINDRA YAMAHA

Front fairings

Handle bars

Fuel tank

Mud guard

Side panel

Foot pegs

Seating

Exposed engine

Side view

mirrors

Indicators

Head lamp

Horn

Number Plate

placement

Finishing

Alloy wheels

Leg guard

QUES:) Rate out of 1 to 5 on Accessories (place 5 by your best choice,4 by your second

choice and so on) REFER TO THE MOTORCYCLES OF THE ECONOMY SEGMENT

MENTIONED ABOVE ( TVS star city , Hero Honda splendor and passion, Bajaj discover ,

Suzuki sling shot, Honda CB twister, Mahindra stallion in specific )


PARAMETER

S

HERO

HONDA


I

MAHINDRA YAMAHA

Mobile charger

Bottle Holder

Helmet Hanger

Trunk

Windscreen

Tool Kit

Luggage Rack

QUES:) Would your next motorcycle be a TVS star city or TVS Sports?

1 Yes

2 No

3 Maybe

ANNEXURE II


NAME: __________________________

AGE: ____________________________

OCCUPATION: ____________________

1. Do you own a motorcycle? If no do you intend to buy one?

2. Which particular motorcycle do you aim to buy? Why?

3. What according to you is the most important attribute while purchasing a particular

motorcycle?

4. What motivates you when you think of purchasing a motorcycle?

5. If you’re planning to buy a new motorcycle, how much do you intend to spend?

6. Would you prefer to buy a motorcycle of your favourite colour? Even if you have to spend

more?

7. Would you like to go for a loan while purchasing your new motorcycle?


8. Do you think resale value is also a parameter behind the purchasing decision?

9. Would you like to go for an expensive motorcycle with amazing looks and style and low

on mileage or would you like to buy a decently stylish and modern motorcycle with a good

mileage at an economical price?

MEDIA

10. What is the impact of media while purchasing a motorcycle do you think it’s important.

A-List the newspapers according to your preference and convenience?

B- List the TV channels which you love watching the most?

C-Which all social networking sites are you associated with, list the first 3?

11. Which is your favourite motorcycle commercial which you remember? And what is the

reason for its recall?

12. Do you think TVS commercials are appealing? If no what is the reason for it? Give

separate views for different modes of media?

CONSUMER PERCEPTION ANALYSIS ON ECONOMY SEGMENT

MOTORCYCLES

13. How many economy segment motorcycles are you aware of list few?


14. Taking technical specifications like Engine, brakes, fuel capacity, seat height, battery and

weight where you would rate the following Hero Honda, Bajaj, Yamaha, TVS, Mahindra,

Suzuki. Mention by giving a reason to it?

15. Taking style and looks(Handle bars, Fuel tank, side panel , mud- guard, seats, indicators

and head lamp) into consideration which brand do you think is the best?

16. What are the new features that you are aware of in the economy segment motorcycles

(example self start, alloy wheels etc)?

17. Which motorcycle do you like the most and you want to buy in the economy segment

bikes? What is the reason for it?

18. What is you perception about TVS motorcycles, Do you wish to buy one in future? If yes

why and if no what is the reason?

19. What according to you a motorcycle of economy segment should ideally have?


ANNEXURE III

Name : ______________________

Date of Birth : ______________________

Address : ______________________

Telephone/Mobile : ______________________

Occupation : ______________________

Marital Status - Married ( ) Bachelor ( ) Tick mark the right option

Q1- Do you own a motorcycle?

iii) YES [ ]iv) NO [ ]

Q2- Do you intend to buy one in future?

III. YES [ ]IV. NO [ ]

Q3- Which two-wheeler would you purchase in future?

V. (a) Motor bike ( ) (b) Scooter ( ) (c) Electric bike ( )

VI. (d) Can’t say ( ) (e) I don’t want to buy one ( )

Q4- If motorcycle, then how much are you willing to spend on a motorcycle in future?

(a) Less than 30,000 [ ] (b) 30,001-40,000 [ ] (c) 40,001-50,000 [ ]

(d) 50,001-60,000 [ ] (e) 60,001-80,000 [ ] (f) More than 80,000 [ ]

Q5- How do you intend to purchase your motorcycle in future?

e) Cash paymentf) Loan from the bank


g) Gift from family or friendsh) Others ( ) Please specify

Q6- Which was the last brand of motorcycle used by you?

(a) Hero Honda ( ) (b) Bajaj ( )

(c) TVS ( ) (d) Honda ( )

(e) Suzuki ( ) (f) Royal Enfield ( )

(g) Mahindra ( ) (h) Yamaha ( )

(i) Others (Please specify) _______________

Q7- How do you learn about a particular motorcycle before buying it?

(a) Discussing with friends & family(b) Watching TV and Reading newspaper commercials (c) Doing an online Survey(d) Discussing with the prevalent users(e) Visiting different dealers and personally gathering information(f) By test drive(g) Others( Please specify)

Q8 – Rank the following attributes of the bike as per your preference? Mark 1 against

the most important attribute and 10 against the least important attribute.

ATTRIBUTES RANK

Price

Mileage

Style& looks

Safety& control

Resale Value

Color

Technology

Speed & Performance

Durability


Maintenance cost

Q9- You have collected information about the particular brand from which source?

i) Newspaper &Magazines ( )`ii) T.V. or Radio ( )iii) Internet ( )iv) Family, Friends ( ) v) Bill boards and pamphlets ( )vi) Others ( Please Specify) ( )

Q10- How many showrooms do you visit before purchasing the motorcycle?

I. Only 1II. 2 showrooms

III. 3 showroomsIV. More than 3V. Twice the same showroom

VI. Others please specify

Q11- How important is PRICE to you when you are planning to purchase a new economy

segment motorcycle? Please rank out of 1 to 5?

Strongly Disagree Disagree Neutral Agree Strongly

Agree

1 2 3 4 5

Q12- How important is MILEAGE to you when you are planning to purchase a new

economy segment motorcycle? Please rank out of 1 to 5?



Agree

1 2 3 4 5

Q13- How important is LOOKS & STYLE to you when you are planning to purchase a new



Agree

1 2 3 4 5

Q14- How important is LOW MAINTENANCE to you when you are planning to purchase a

new economy segment motorcycle? Please rank out of 1 to 5?


Agree

1 2 3 4 5

Q15- How important is RESALE VALUE to you when you are planning to purchase a new


Strongly Disagree Disagree Neutral Agree

Strongly Agree

1 2 3 4 5

Q16- Rank the following motorcycles in order of your preference?

HONDA CB SHINE

HERO HONDA SPLENDOR 100

TVS STAR CITY 110

HERO HONDA SPLENDOR NXG

HERO HONDA PASSION PRO

TVS SPORTS 100

BAJAJ DISCOVER 100

HERO HONDA PASSION PLUS

TVS JIVE 110


HERO HONDA CD DAWN

BAJAJ PLATINA

HONDA CB TWISTER 110

SUZUKI SLING SHOT 125

BAJAJ DISCOVER 125

HERO HONDA CD DELUXE

YAMAHA YBR 110

MAHINDRA STALLIO 110

YAMAHA SS 125

Q17- Give a reason for your ranking in the above answer?

__________________________________________________________________________

Dated_______________ Signature

“WE THANK YOU FOR THE TIME THAT YOU HAVE INVESTED IN OUR

QUESTIONNAIRE, YOUR VALUABLE OPINION AND SUPPORT IS OUR

INSPIRATION.”


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