INDIVIDUAL ASSIGNMENT

Customer Relationship of Hero MotoCorp

Delivering Customer Value

BM009-3-2LECTURER: MR. ABHISHEK THAKUR

Monifa Aktari (NP000006)

HANDS OUT DATE:

HANDS IN DATE:

WEIGHTAGE:

WORD COUNT:

7 September, 2017

25th November, 2017

60%

2000 words

INSTRUCTIONS TO CANDIDATES

1. Submit your assignment at the administrative counter 2. Students are advised to underpin their answers with the use of references

(cited using the Harvard Name System of Referencing) 3. Late submission will be awarded zero (0) unless Extenuating

Circumstances (EC) are upheld 4. Cases of plagiarism will be penalized 5. The assignment should be bound in an appropriate style (comb bound or

stapled). 6. Where the assignment should be submitted in both hardcopy and

softcopy, the softcopy of the written assignment and source code (where appropriate) should be on a CD in an envelope / CD cover and attached to the hardcopy.

7. Pass mark is 50%

Acknowledgement

I would like to express my deepest gratitude to lord Buddha Education Foundation (LBEF),

affiliated to faculty of management, Asian pacific University (APU) for making this project a

mandatory requirement in Bachelor of Business Management (BBM) program.

I am thankful to Mr. ABHISHEK THAKUR, Lecture at LBEF for helping me out to

complete this report. Doing this project made me know more about Hero MotoCorp

Finally, I would like to thank my parents and friends for their continuous support throughout

the process of this report.

Executive Summary In this report I have written about Hero MotoCorp along with its mission and vision. Hero

MotoCorp is the largest motorbike seller in the world in terms of volume. It provides

different kinds of products (bike and scooter) so people can choose as there is a range in

prices. The prices of bike and scooter differ from its features. I have maintained about its

operational efficiency along with-it strategy. Hero MotoCorp is operational efficient because

its product varies with price so people with lower income can afford to buy them. Its product

are fuel efficient and with reasonable price.

Through this report the readers will know about Hero MotoCorp and its segmentation as well

as the current market of two wheeler. Hero MotoCorp has segmented its product based on age

and income of people. It targets the youth as its tag line says" Ham Mein Hai Hero" which

talks about its brand and also encourages people to use the product. The term "Hero" is

ambiguous which gives two meaning one it is promoting the brand and it also states that

people who have courage, brave or those who are hero will buy these product.

The report also talks about CRM and its benefits that Hero MotoCorp gets from it. Along

with customer pyramid model is also shown. The model is described and are linked with

Hero MotoCorp. The recommendation is also included in this report. If the company follows

the recommendation then they will earn more profit and even capture more customer.

Table of ContentsIntroduction...........................................................................................................................................1

Vision................................................................................................................................................2

Mission..............................................................................................................................................2

Strategies of Hero MotoCorp.............................................................................................................3

Market segment.................................................................................................................................3

Operational efficiency...........................................................................................................................4

Customer intimacy................................................................................................................................4

Product leadership.................................................................................................................................4

Customer pyramid.................................................................................................................................5

Customer relationship management (CRM)..........................................................................................6

Conclusion and Recommendation.........................................................................................................7

Bibliography..........................................................................................................................................9

MARKS ALLOCATION....................................................................................................................10

Introduction

Hero MotoCorp Ltd is an Indian producer of motorbike and scooters. Its headquarter is

located in Gurugram, India. It was founded by Brijmohan Lall Munjal in the year 1956 as a

bicycle manufacturer. The company named Hero Honda after the joint venture between Hero

group of India and Honda motors of Japan .In the year 2011 Hero Honda got split with Honda

group and was renamed as Honda MotoCorp. Hero MotoCorp is the largest player in

motorcycle segment in India and provides a large range of bikes and scooters. The

motorbikes and scooters are manufactured in four parts of India and they are Gurgaon,

Dharuhera which are located in Haryana the third one is located in Haridwar and the last one

is in Neemrana, Rajasthan. (heromotocorp.com, 2016).Hero MotoCorp has a total operations

that are globally operated in 35 other countries such as Bangladesh, Sri Lanka, Egypt etc

(Times, 2017) . It has 39% market share in two wheeler and 52.4% market share in

motorcycle market. Its revenue figures of 2016-2017 are 31,368.55 crore (heromotocorp,

2017) It has more than 5000 people who are employed within the organization. It also

invests heavily in the R&D which is located in Jaipur. Along with this it offers a wide variety

of product among the motorcycle the products are

1. CBZ

2. Karizma

3. Pleasure

4. Splendor

Hero MotoCorp has been the number one two-wheeler company in the world for the 15th

consecutive year. Hero MotoCorp takes a socially responsible company who respect the

environment and is strongly committed to environmental conservation programmers and is

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also concerned about economic concerns. "We must do something for the community from

whose land we generate our wealth" famous quote by Mr. Brijmohan Lall Munjal.

Hero MotoCorp demonstrate their excellence in environment performance and to achieve this

they substitute hazardous chemicals. They are also committed to safety and health of its

employees who will be effected by its operation. They believe that safe work practices lead to

better performance which helps in higher productivity and motivated workforce.

Hero MotoCorp gives focus on quality they are committed at all level to achieve higher level

of quality in whatever they do, or in their product and service which will meet the customer's

expectation. It also does sponsorship of many events related to sports. It has also received

many awards and recognition for its work.

Vision Committed towards providing a sturdy and solid world class mobility solutions with a

renewed focus. And as well as steadily moving ahead by expanding the footprint in the global

arena

MissionTo become a global enterprise by fulfilling customer's needs as well as aspiration for

mobility. We aim for setting benchmarks in technology, style and quality in order to convert

customers into brand advocates (heromotocorp, 2016)

Core value

Integrity

Humanity

Excellence through teamwork

Speed

respect

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Strategies of Hero MotoCorpThere are many motorbike companies that are trying to fulfill the demand of the customer.

The market is tough as every other motorbike company is try its best to make customer

satisfied so Hero MotoCorp is the leader in this sector and it has got a lot of competitor.

Competitor means a lot of hard work and research that are needed to be done .Hero

MotoCorp is aware about its competitor and tries its best by providing different kinds of

motorbike that are fuel efficient.

The strategies that Hero MotoCorp uses are:-

Focusing on building a robust product portfolio across categories

Exploring the growth of new markets

Improving operational efficiency

Expanding the customer reach

Invest in brand building

Ensuring that customer and shareholders are delighted

Building global talent workforce

Market segment Today youth want product that having a "wow" factor to it and they seek value for money.

Customers are now savvy and they always look for products which can give them value. So

Hero MotoCorp focuses on youth and promotes its brand through T.V advertisement, social

media etc.

Hero MotoCorp has targeted its customer in terms of their income and age. Urban as well as

rural youth who are within the age of 20-40 years with a lower to middle class income group.

It provides product that ranges from INR 40,000 and up to 1, 00,000. The bikes that are

below 150 cc are targeted to customers who have low income whereas bikes above 150cc are

target for customers who have a high income.

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Operational efficiency Operational efficiency talks about delivering quality goods in less cost. Customers are the

people who buy the products and consume them. It is a capability of organization to deliver

product or service in cost effective way but still ensuring that the high quality of the product

remains. Companies who pursue operational efficiency always seek to minimize cost and

deliver product /service at a competitive price with minimal inconvenience.

Hero monocarp also does operational efficiency as they have wide variety of product for its

customer. The prices of the product are reasonable so people from middle class can also

afford them.

Customer intimacy It is a strategy where retailers or firms tries to know about the customer needs and wants. It

talks about offering unique range of customer service to customers (mbaskool, 2016). The

personalization of service and customization in product is done to meet the customer

expectation. Customer intimacy focuses on the individual needs. Customer intimacy can be

done by focusing on customer need and aligning product development, manufacturing,

administrative function and executive together.

It is a customer centric model which results in long term relationship with most profitable

customers. For a company to be customer intimacy it needs transformation into a company

which understands it customer and satisfy their needs and demands. Customer intimate

company tries to understand the customer rather than trying to sell the products. The

company will imagine what it would be if they were in the customers shoes. It listens to its

customer and tries to think outside the box.

Product leadershipIt aims to build a culture and bringing superior products in market. For a company to be

product leader it needs to be creative which means embracing new ideas. Along with these

the company also tries to solve the problems related to their products or service (Treacy &

Wiersema, 2016).The example of a product leader would be Johnson &Johnson they bring

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good ideas and develop them as well as look better ways to improve their product. Product

leaders are the companies who have made themselves creative and bring new products. They

create as well as maintain an environment where employees shear their ideas and which they

listen. They are always looking for possibilities where they can make new product and

service. When other companies see fault in their marketing plan or their product leaders focus

on the opportunity and the way they can capture it.

Product leaders are their own competitor so they try to break their own ground and try to

bring new product in the market.

Customer pyramid Customer pyramid it is a new concept of market segmentation which is based on customer

profitability. The traditional way of customer segmentation approach have changed and know

focus is given on customer's purchase history or profitability. The traditional segmenting way

such as age, gender have now been replaced with business related attributes. customer

pyramid consists of four segments such as: platinum customer, gold customers, iron customer

and lead customer.

Platinum customer

Platinum customer are those who spend a lot of money on goods and service. These

customers are loyal customers who will always buy from the same band .these customers

trust a brand and always buy the products of the same brand.

The platinum customer of Hero MotoCorp are the higher income group people who will buy

the product even if the prices are expensive.

Gold customer

These are the customer who visit the store and websites to look for product but they are price

sensitive. They can even change their choice and go to competitors if they get better product

with lesser price.

The gold customer of Hero MotoCorp will be the middle class people who will visit the store

but want a little discount in the product.

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Iron customer

These are the types of customer who look for product with less price and buy only when the

price is less. They cannot be loyal customer as they change their choice anytime they fell that

the product is expensive.

The Iron customer of Hero MotoCorp will be the people who have low earning and who want

a high discount in the product.

Lead customer

Customers who look for heavy discount and buy always ask for better product in cheaper

price. They want to buy only those product which gives high discount. These customers

return time and again to exchange products and ask for discounted products.

The lead customer of Hero MotoCorp will the people from urban areas who always want to

buy cheaper products.

Customer relationship management (CRM)CRM refers to practices, strategies which companies use to analyze the customer interaction

as well as manage them throughout customer lifecycle. The main aim for CRM is to build a

long term relationship between company and customer. CRM system collect the information

about customer from different channel or point of contact. The information can be gather

through company's website ,telephone call, direct mail, social media etc. the collected

information can be accessed anytime by employee.

CRM talks about making every customer feel like they have a relationship with the company.

It gives an opportunity to the company for recognizing their customer as well as understand

them. The benefits which Hero MotoCorp can get from CRM are as follows: -

1. Develop superior service as well as product which meet customer expectation

2. Enhancing marketing toward most profitable customers

3. Providing support as well as service to customers through online

4. Increase the satisfaction level of customer

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Conclusion and Recommendation Hero MotoCorp is the market leader in two-wheeler market Hero MotoCorp is widening its

business horizon in order to reach customer and satisfy them. The company is backed up with

technology that are driven to achieve customer needs and reach geographical reach. The

company is giving a wide range of product to its customer. There are various range of bike

from which customer can choose according to their convenience .Hero MotoCorp are now

available on urban as well as rural market it is because of its wide distribution channel. Some

of the recommendation which I would like to give to Hero MotoCorp are:-

1. Superior customer valueValue talks about quality which is offered at the right price and right time. It is

important for a company to be different from its competitors. For a company to

survive in the market it need to satisfy the customer needs and provide customer

value which will attract them to be loyal customer . Customer want product that can

satisfy their need and be different from others so they seek for those companies who

provide better value than their competitors.

Hero MotoCorp has been facing problems such as low sales on 7 bikes. These 7 bikes

are Karizma R, Xtreme, Hunk, Old Glamour Fi, Ignitor, Passion X Pro and Passion

Pro TR. Hero MotoCorp should focus on customer value analysis. The analysis will

give the idea of the factors that contribute to quality in the customers mind. The

analysis will use the information that will be collected from customer which will

show the buying behavior along with decision making behavior of the customer.

(Daniels, 2017)

2. Market segmentation Market segmentation refers dividing a whole market into small groups. Hero

MotoCorp manufactures bike and scooters. It only covers the bike and scooter market

but it does not have any product for children's. So market segmentation should also

include children's bicycle. Bicycle are easy to ride and children's enjoy riding them. It

helps prevent pollution and children's are not allowed to use bike or either scooter so

for them bicycle is the choice. By doing this hero MotoCorp can gate more customers

and earn reputation.

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3. Social media

Hero MotoCorp does a lot of advertising through TV, newspaper etc. But they do not

use internet properly. Most of the ads are given in TV so the company needs to use

internet as the main source of promoting the brand. Today's business is about being

online and internet has become one of the important part of our life. So by doing

advertisement online the company can attract more customers. Now more people are

using social media rather than watching TV so Hero MotoCorp needs to focus more

on social media for its brand promotion. Fan page can be made where people can

share their story in this way the brand name will also be promoted

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BibliographyDaniels, P., 2017. www.rushlane.com. [Online] Available at: https://www.rushlane.com/hero-motocorp-bikes-discontinued-12243417.html[Accessed Friday 27th October 2017].

heromotocorp.com, 2016. www.heromotocorp.com. [Online] Available at: http://www.heromotocorp.com/en-in/about-us.php[Accessed Friday 27th October 2017].

heromotocorp, 2016. www.heromotocorp.com. [Online] Available at: https://www.heromotocorp.com/en-in/uploads/Annual_Reports/pdf/20160826110519-pdf-303.pdf[Accessed Friday 27th October 2017].

heromotocorp, 2017. www.heromotocorp.com. [Online] Available at: http://www.heromotocorp.com/en-in/digital-annual-report-2016-17/[Accessed Friday 27th October 2017].

kathmandupost, 2017. www.kathmandupost.com. [Online] Available at: http://kathmandupost.ekantipur.com/news/2017-07-20/demand-for-premium-motorcycles-revs-up.html[Accessed Friday 27th October 2017].

mbaskool, 2016. www.mbaskool.com. [Online] Available at: https://www.mbaskool.com/business-concepts/marketing-and-strategy-terms/11417-customer-intimacy.html[Accessed Wednesday 8th November 2017].

Times, T. E., 2017. www.economictimes.com. [Online] Available at: https://economictimes.indiatimes.com/latin-american-countries-key-markets-for-heros-global-ambitions/articleshow/58583834.cms[Accessed Friday 27th October 2017].

Treacy, M. & Wiersema, F., 2016. www.hbr.org. [Online] Available at: https://hbr.org/1993/01/customer-intimacy-and-other-value-disciplines[Accessed wednesday 8th November 2017].

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MARKS ALLOCATIONThe assignment will be evaluated based on the following criteria:

Criteria No.

Item Marks Allocation (%)

1 Executive Summary 5

2 Brief description of the company 10

3 Analysis of customer relationship marketing Strategies

60

4 Conclusion & Recommendation 15

5 Overall Quality - Include format, citations, referencing and good use of language to show clarity in writing with minimal spelling and grammatical errors.

10

Total Marks 100

10