Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
in Bangladesh
Submitted To-
Shakil Huda
Professor
IBA
University of Dhaka
Submitted By-
th
Date of Submission- 8 June 2013
Institute of Business
Administration University of Dhaka
Letter of Transmittal
th
8 June 2013
Sir,
Here is the report on The Marketing Strategy of Two Wheeler Products in
Bangladesh that you asked us to prepare.
We tried to follow the guidelines that you provided us throughout the semester, in
preparing the report. Working with such an interesting report given us the opportunity
to achieve knowledge and experience about the marketing strategy and processes of
different two wheeler companies operating in Bangladesh. This task was quite
challenging and we thoroughly enjoyed working on preparing this report.
We would be extremely delighted and honored if you accept the report and
recognize the hard work and devotion we have put on preparing this report. We truly
appreciate this assignment, and should you need any assistance, please call on us.
Sincerely,
Asifur Rahman
Roll- 17 Batch- 48D
Sadman Prodhan
Roll- 47 Batch- 48D
Table of Contents
Executive Summary.....................................................................................5
Literature Review.........................................................................................6
Overview of the two wheeler companies..................................................7
Market share of two wheeler brands........................................................9
Introduction...............................................................................................10
Objectives..................................................................................................11
Overall Objective....................................................................................11
Specific objective....................................................................................11
Methodology..............................................................................................11
Primary Data:..........................................................................................11
Secondary Data:.....................................................................................11
Scopes of the Study...................................................................................12
Limitation of the Study..............................................................................12
Marketing Division: A Key to Success........................................................13
Segmenting, Targeting, and Positioning.....................................................14
Differentiation Tools...................................................................................16
Application of Four Ps...............................................................................17
Product and Pricing.................................................................................17
Promotion...............................................................................................18
Place.......................................................................................................18
Porters five force analysis.........................................................................19
Threat of intense segment rivalry...........................................................19
Threat of new entrants...........................................................................19
Threat of substitute products..................................................................19
Threat of bargaining power of buyer......................................................20
Threat of bargaining power of suppliers.................................................20
Social activities by the automobile companies..........................................20
Marketing Control in Process.....................................................................21
Conclusion.................................................................................................22
Recommendations.....................................................................................23
Bibliography..............................................................................................24
Appendix...................................................................................................25
Executive
Summary
This report deals with the two wheeler industry in Bangladesh. More specifically, who
are the major players in two wheeler industry and what are the marketing strategies
they are adopting, how consumers recognize and rate different two wheelers in
competitive scenario. The project named The Marketing Strategy of Two Wheeler
Products in Bangladesh is undertaken to analyze how dealers utilizing the four p`s
(product, place, price and promotion) of marketing mix and what are all current
trends is going on in two wheeler automobile industry. In addition, Porters five force
analysis for the industry has been done give a perspective on the intrinsic long run
attractiveness of the market. Main aspects of the project are to analyze the different
products and services offered. A conclusion has been drawn based on the analysis
done and some recommendations for the overall improvement of the industry have
been given.
Literature Review
Automobile industry is one of the largest industries in global market. Being the leader
in product and process technologies in the manufacturing sector, it has been
recognized 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
realizing the sector's full potential for the economy. 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.
A Nations economy is well known from its transport system. For instant and rapid
growth in economy, a well-developed and well-networked transportation system is
essential. As Bangladeshs transport network is developing at a fast pace,
Bangladesh automobile Industry, specially the two wheeler industry is growing too.
Also, the Automobile industry has strong backward and forward linkages and hence
provides employment to a large section of the population. Thus the role of
Automobile Industry is very essential in Bangladesh economy.
In Bangladesh extensive road network has been made in the rural areas as part of
the infrastructural development. Motorcycle is used as transportation which has
increased the opportunity of motorcycle business in Bangladesh. About 100
companies which includes from dealers to manufacturers are operating their
marketing activities in Bangladesh and they follow their own marketing strategies to
capture the market share.
There are several companies in Bangladesh competing for the top spot in market
share of motorcycle industry. Among other motor cycle companies, Uttara motors ltd,
Atlas BD, TVS auto BD Ltd., Runner Automobiles Limited, Singer Bangladesh Ltd.
and Walton are the frontrunners.
Overview of the two wheeler companies
Uttara motors ltd has been one of the market leaders in the motorcycle industry.
Uttara Motors Limited is the flag bearer of the Uttara Group of Companies, engaged
in the sales and marketing of different brands of automobiles throughout the country
through its sales & service network. They are sufficiently equipped to meet any
challenge in the new century. The companys wide network of distributors (Dealer
Network) is capable and organized to deal with any challenge. They have behind
them a long experience of 38 years of success in the domestic market. They have
Modern & Dynamic management in every step of the company structure which
consists of team work of a complementing group of experienced directors and a
dedicated staff & executives.
The company was established in 1966 under private management by the then West
Pakistani entrepreneur. It was nationalized and placed under the management of
Bangladesh Steel & Engineering Corporation (BSEC) in 1972 and converted into a
Public Limited Company in 1987 when 49% of its share was sold to general public
and 51% is retained with BSEC. Among their products are CBZ, Hunk, Passion pro,
CD deluxe, Splender etc.
Established in 2007, TVS Auto Bangladesh Ltd is a joint venture company between
the Rian Motors (a concern of Sony-Rangs Group) of Bangladesh and TVS & Sons
of India. It has been assembling and marketing TVS Brand Two-wheeler and Three-
wheeler. It is the first ever joint-venture company in two-wheeler industry in
Bangladesh. TVS has planned to raise its market share in Bangladesh within the
next few years. The company expects Bangladeshs two-wheeler market to boom in
coming years.
Runner Automobiles Ltd was established in the year 2000. The Company is
registered in Joint Stock Company of Bangladesh under Companies Act.1993 as a
Private Limited Company. The company deals with a wide range of motorcycles. The
company's sales are organized by an efficient network through its dealers in different
parts of the country. Mr. Hafizur Rahman Khan, the Chairman, a well-experienced
personality having long twenty-four years of successful motorcycle marketing
background, heads the Company. Mr. Mozammel Hossain, the vice chairman, a
successful marketing expert having long experience in motorcycle marketing, is
heading the company Sales. Other senior professionals/experts in departments like
Production, Sales, Service, Administration, Accounts and Commercial run the
company.
Walton motors produces various kinds of motorcycles which are putting up stiff
competition for the bikes exported from foreign countries. The price of their
motorcycles is low to other motorcycles like Hero Honda, Bajaj, Yamaha, and Honda
which are currently leading the market. At present Walton has various product lines
of motorcycle like Fusion, Prizm, Xplore etc.
Others
19%
Bajaj
30%
TVS
12%
Hero Honda
Dayang 22%
17%
Introduction
Two wheeler products or motorcycles are one of the leading and fastest growing
vehicle industries in Bangladesh. Bangladesh is a high density country. Total
population of the country is near about 160 Million. Among total population
approximately 80 percent people live in the rural areas and depend on agriculture.
As part of infrastructural development in the country, an extensive road-network has
been developed in the rural areas creating opportunities for trade and commerce.
Motorcycle is one of the modes of transportation whose use has been increased at a
significant level in the last decade. To fulfill the demand of the customers several
companies now are marketing motorcycles. Majority of the two wheeler market
depends on the import of motorcycles from India, China and Korea. There are about
100 automobile companies that are operating their marketing activities in
Bangladesh. Among them 10- 12 companies are enjoying majority of the market
share. These companies are following marketing strategies of their own to capture the
market share. Market share of these companies is gained and expanded by following
the four P's (Product, Price, Place and Promotion) literally. The implementation of
these four P's is studied for conceptualizing the marketing program of these
companies.
Overall Objective:
Specific objective:
Methodology
Primary Data:
This is a literature based paper and therefore to conduct this study, data collection
from customer through questionnaire were avoided. But a number of executives and
managers from different motorcycle companies were interviewed for detailed
information.
Secondary Data:
The study is focused on the recent trends of motorcycle market of Bangladesh. This
study will explain the aspects and strategies of motorcycle industry of Bangladesh.
So it would be very useful for different users.
Basically anyone studying the report will get firsthand information about two wheeler
markets which he can use in developing the market itself.
Limitation of the
Study
During the preparation of this report we had to face a few problems. These disrupted
the preparation of the report. They are discussed below.
Market segmentation involves dividing a market into smaller groups of buyers with
distinct needs, characteristics or behaviors who might require separate products or
marketing mix. In Bangladesh, for motorcycle marketing automobile companies are
segmenting their market based on all four types of segmenting variables.
Market is segmented on the basis of-
Geographic Segments
Demographic Segments
Psychographic Segments
Behavioral Data Segmentation
In motorcycle market product differentiation is very difficult because the products are
durable but more or less homogeneous.
They are trying to ensure better services to the customers. They provide services to
the customers which will be different from the competitors in some extent. Providing
services are replacement of damaged product, broken spare-parts and ensuring
quick supply through own distribution channel. Companies are providing after-sales-
services for bonding and strengthening the Customer Relationship. For this
purpose they use experienced technical team which is generally headed by a
General Manger. They foster various mobile service teams operating in different part
of Bangladesh. Every team follows a yearly service calendar. Service mobile teams
ensure warranty. Warranty replacements are made within 48 hours. Every
automobile company, operating in Bangladesh, has a central workshop to ensure the
after-sales-service to the customers. Companies are offering personnel
differentiation from their competitors to attract their customers. They are recruiting
competent and responsible personnel. As a result, they have qualified management
and they are providing training facilities to the personnel in modern and well
communication system. Every company has a well-equipped distribution channel by
which it can serve its customers through velocity. Performance of an automobile
company highly depends on its distribution channel. The companies are trying to take
the competitive advantages through fruitful distribution channel.
Application of Four Ps
Place:
The motorcycle distribution mainly depends on the dealers and distributor within the
country. The major dealers interact directly with the companies' sales executives for
purchasing the motorcycle. Then they distribute motorcycles amongst wholesalers
who in turn sell those to retailer. However, in this market it is very difficult to
demarcate between wholesalers and retailers as most of the wholesalers also do
retailing very often as per demand. That means in this market wholesalers are also
retailers in the same time. In the marketing channel, companies select the
distributors based on demand position, sales-volume consideration and dealer's
sales capacity. Companies are having defined classification of the dealer depending
upon his location, area of operation, profile of business, sales volume, degree of
exclusivity etc. In accordance to the classification, dealer will get the benefit with
respect to price (discounting structure) and delivery. A crucial balancing is also
required amongst the dealer in terms of pricing so that big dealers cannot sale the
product at a lower price to a small dealer in another location and in the process
disturbing the
whole networking concept. This phenomenon may be described with an example
considering its importance in maintaining the channel.
The industry rivalry is extremely high with any product being matched in a few months
by competitor. This instinct of the industry is primarily driven by the technical
capabilities acquired over years of gestation under the technical collaboration with
international players.
Here the threat of new entrants depends on the economies of scale of the cost of
production and customer switching costs, access to industry distribution channels.
There is no perfect substitute to this industry. Cars, which again are a mode of
transport, do never directly compete or come in consideration while selecting a two-
wheeler, cycles do never even compete with the low entry level moped for even this
choice comes at a comparatively higher economic potential.
Threat of bargaining power of buyer:
Buyers in automobile market have more choice to choose from and the increasing
competition is driving the bargaining power of customers uphill. With more models to
choose from in almost all categories, the market forces have empowered the buyers
to a large extent.
Suppliers of auto components are fragmented and are extremely critical for this
industry since most of the component work is outsourced. Proper supply chain
management is a costly yet critical need.
For creating and upholding the image of the company and its product social activities,
parts of the public relation activities play a pivotal role. Public Relations involve a
variety of programs designed to promote or protect a company's image or its individual
products. Automobile companies are involved in different social activities such as
giving stipend to poor-meritorious students and distributing relief among the peoples
affected by natural calamity.
Marketing Control in Process
Marketing control is the evaluation of the marketing strategy and taking corrective
actions. In Bangladesh automobile companies follow four steps of marketing control
process which is as follows:
Set Goals
Measure Performance
Performance Evaluation
Corrective Action
What Companies
Want to Achieve?
What is happening?
Why is it happening?
In every month companies set their sales target to achieve. If the companies fail to
achieve its target in a month, the target is revised in the next month. This controlling
system helps the companies to take corrective actions instant to achieve the
objectives.
Conclusion
Every company has their own marketing strategy. Companies have their own skilled
sales force controlled by the head of marketing to increase sales. Companies that can
make the effective application of four P's will gain a greater market share and survive
in the long run. They position their products in the customers' mind by creating
competitive advantages through price, quality, design etc. Market differentiation is
done by the companies through features, design, performance, conformance, price,
skilled-knowledgeable and competent personnel, and advertising in various media.
For expanding their market share they apply the tools as offering incentive
packages, exhibition, and dealer conferences. In near future motorcycle companies
operating in Bangladesh perhaps will be able to export their products in overseas
market if they continue their application of marketing strategies effectively and
smoothly.
Recommendations
Websites
http://www.atlas.gov.bd/
http://www.runnerbd.com/ral/
http://www.singerbd.com/
http://waltonbd.com/
Books
th
Kotler Philip, Keller K. L., Marketing Management, 14 Edition, 2012
th
Kotler Philip and Armstrong Gary, Principles of Marketing,12
Edition,2010
Appendix
1. Name
transportation? Yes [ ]
No [ ]
months? Yes [ ] No [ ]
.
8. Rank the Motorbike manufacturing company.
1. Hero Honda [ ]
2. Yamaha [ ]
3. Bajaj [ ]
4. TVS [ ]
5. Walton [ ]
[ ] TV Commercials
[ ] Printed Commercial
Excellent [ ] Outstanding [ ]
_.
Thanks
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