the indian Automotive sector as a whole faced tremendous slowdown in demand but market leader Maruti Suzuki posted mind-boggling numbers. B&E Pawan chabra finds out what the company did differently in the last fiscal to achieve this feat
Not many people know that there is a separate department in the sales and marketing team of Maruti Suzuki dedicated to take care of its rural strategy. There are around 2,500 rural dealerships sales executives currently working in the company out of the total 15,000 sales executives working in the company and “we will be hiring in rural areas very aggressively in this fiscal,” asserts Shashank Srivastava, Chief General Manager (Marketing), Maruti Suzuki India. The company is aiming at a 15% contribution to the total revenues by the end of this fiscal coming from the rural sales. There is no denying the fact that requirements in the rural part of the country are very different from that of the urban market and hence the company is selling entry level vehicles – Alto, WagonR & Zen Estillo – the most in these areas. Clearly, the company is playing a volume driven game rather than showing unnecessary audacity by offering high end products like a Vitara or a SX4. But Srivastava took no time to mention “that the company is still very much open to meeting any kind of demand that comes from the rural areas.”
Going forward, experts believe other players will also aggressively target the rural market. However, going by past results and the milestones achieved by the company, one cannot show its back to the fact that Maruti will not leave any stone unturned to capture the top rank in the automobile sales in the rural market too.
In absolute sales, at 3.6% the company sold lesser than expected in the last fiscal, but analysts believe the growth to be decent keeping in mind the hit that the sector has taken in recent times. In fact, industry watchers claim that its parent company Suzuki Motor Corporation, Japan has been able to avoid any losses for the Jan-Mar 2009 quarter simply on the back of the boost given by sales figures of its Indian subsidiary. Hyundai & Tata Motors are also strategising to make a beeline for the high-growth hinterlands, but as always Maruti’s first mover advantage will help them rule the strategy war room.
Going forward, experts believe other players will also aggressively target the rural market. However, going by past results and the milestones achieved by the company, one cannot show its back to the fact that Maruti will not leave any stone unturned to capture the top rank in the automobile sales in the rural market too.
In absolute sales, at 3.6% the company sold lesser than expected in the last fiscal, but analysts believe the growth to be decent keeping in mind the hit that the sector has taken in recent times. In fact, industry watchers claim that its parent company Suzuki Motor Corporation, Japan has been able to avoid any losses for the Jan-Mar 2009 quarter simply on the back of the boost given by sales figures of its Indian subsidiary. Hyundai & Tata Motors are also strategising to make a beeline for the high-growth hinterlands, but as always Maruti’s first mover advantage will help them rule the strategy war room.
Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
and Arindam Chaudhuri (Renowned Management Guru and Economist).
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