What better time for discussing the aforementioned topic, post the release of the Mahindra’s “Live Young, Live Free” campaign.
Seldom automotive ads could touch the Target Group in a holistic manner. The communication most of the times used to narrow down on features rather depicting the connect. Automotive advertisements are one of the most difficult ads to create – the understanding of the consumer requirements and association with the brand needs to be spot on! The message has to be a combination of aspiration and utility – the mixture needs great level of creativity to be precise.
Months ago I encountered the BMW – Feeling Remains ad. I simply re-winded the ad several times for the pleasure of it. It was a feeling that lingered on after watching the ad – the advertisers just hit the sweetest spot. The communication just emphasized how the Bavarian Automaker wanted to connect the feelings and emotions of their cars with consumers looking for the ultimate driving thrill. If observed deeply the characters depicted in the movie are the exact Target Segment of the Brand (by the way characters have been dressed, the locale they are present). The ad felt like –
There was only one Indian Ad that had been fresh through years in my mind – “Reclaim your life” of Tata Safari. It had a perfect symphony of exotic visuals, catchy music and touching message to establish the connect. The volume of my TV used to be the maximum when the ad used to be aired. Tata Safari just found a loyalist in me even though I’d never driven that car! It achieved an aspirational value just with the communication.
Strange, ain’t it; how your desires are captured by marketers and presented before you. The excitement and thrill of off-road and adventure has caught the attention of youth. The conversationalist Indian, now isn’t scared to explore new places. Weekend trips are a routine and once-in-a-year travel has become a part of life. The evolving trend has been beautifully captured by the new ad shot by Mahindra. It really celebrates the emerging quest for freedom and adventure. Have a look on the ad –
The ad showcases the Mahindra portfolio of products in exotic locations. The heli-cam shots have amazingly captured the natural landscapes and mountains of Kerala & Ladakh. The ad is directed by Prakash Verma of Nirvana Films (Interface Communications). The music is catchy and so is the message. The ad has already clocked over 8.5 Lakh views within a week of its post in Youtube. We wouldn’t be surprised to see ‘We are the living’ anthem repeatedly being broadcasted and used by Mahindra Automotive Portfolio in the coming months!
A lot has changed this year in the Indian Automotive Space. Alto is no longer strategically important to Maruti Suzuki as Ertiga has proved to be. Renault clearly overpowers the likes of Skoda, VW, Fiat, GM with the success of just one product – all hail the ‘Duster’. M&M pips Tata from the third slot without having an hatchback in its portfolio! Hyundai successfully manages to guard its second spot with the increased numbers from its higher priced products (such as the Verna, Elantra)!
A look on the numbers (Oct’12) – Duster alone vs Skoda, VW, Fiat & GM –
The notable trends of the year were –
a> ‘Diesel’ization – A large chunk of the customers moved to purchase higher priced diesel cars. The consumer was ready to shell out a lakh more for the diesel counterpart as he/she wasn’t ready to bear the fear of the ‘any-time’ increasing petrol prices. No doubt i20/swift fared better in comparison to the only-petrol variant available Wagon-R, i10, Alto or Eon.
b> First Time Buyers readiness to pay more – This clearly infers a rise in the disposable income of the first time buyer. Gone are the days when consumers were ready to accept the basic features of a car. Nowadays the customer wants ‘more’ and luxury is in! A car is surely a style statement more than a means of transportation. A probable Alto customer is now buying a Figo/Micra/i20/Beat and is happy shelling out the extra bucks.
c> Platform Sharing – With the decline in success-rate of new products, OEM’s are apprehensive in investing huge money in developing new products. Also the time-to-market is reduced with the concept of Platform Sharing. Lets see some examples –
i. As against Rs 5.5 bn spent on Xylo, only Rs 1 Bn has been spent on Quanto. The same platform is simultaneously being used on 3 products – Xylo, Genio & Quanto.
ii. Maruti using the Swift platform for Dzire
iii. Renaut & Nissan have mastered the trick – Micra / Pulse and the platform raised to Sunny / Scala
iv. VW & Skoda were the pioneers – Fabia / Polo to Vento / Rapid
SX4 hatch showcased in Auto Expo
The results are clearly visible – Honda is now planning to bring a sedan version of its successful hatchback Brio. We wouldn’t be surprised to see a hatchback version of SX4/Cruze/Fiesta either in the times to come.
d> UVology – You need to have an SUV/MPV in the portfolio to keep the cash registers ringing – this was the mantra for all OEMs this year. The segment has magically grown over 50% and have clearly outnumbered their peers in the similar class – Ex: A Duster sells 5406 units in comparison to the similar priced Verna which does 5050 units (Verna being the leader in its class). XUV 5oo alone sells higher than all the D-segment cars combined!!! This has now started a war between OEMs to fasten their plans of launching their MPVs/compact SUVs. These UVs are not only bigger/better but offer equal value to their sedan counterparts. Ex: A Duster provides a mouth-watering mileage of 20.45 kmpl and Ertiga provides 20.77 kmpl!!
e> Add as many NEW products as you can – Earlier, Indian consumers characteristic was orthodox and were skeptical to try new products. ‘Tried-and-tested’ was the mantra and thus hampered the propositions of new entrants. The recent developments new saw the shift of customers to NOVELTY. If an OEM had a better offering, it was accepted with open-heart. Stalwarts like Tata are facing sudden downfall – the reason being no new product offerings in their kitty (the previous launch Aria was on 2010 – no new product offered from the stable ever since).
* This has now led to a slew of new product launch plans from various OEM’s. The automakers are now on a product-offensive strategy mode and expect a host of new launches in the coming times.
Design as the new ‘Differentiator’ – The best example for the aforementioned point is Hyundai . With its fluidic design philosophy it has earned a lot of admiration and allowed to successfully establish in high-end segments. The fluidic Verna easily over-threw the segment leader within months of its launch. The neo-fluidic Elantra is on the footsteps of Verna and is currently the best performing vehicle in its segment. Eon also set the trend of having stylishly looking products in the entry level category. No wonder Maruti answered with its ‘wave-front’ design inspired Alto 800! Even M&M tried something similar with a “Cheetah” inspired XUV 5oo 🙂 The same concept was heard from Ford when they had introduced the ‘kinetic’ Fiesta!
Indian Automobile Market is now one of the most Volatile and Vulnerable markets in the world. And its is imperative that it would be the most important market for the OEMs considering its tremendous growth potential.
·1) HAPPY FESTIVE SEASON! Was the salute in my previous month’s post. It stood out to be true and majority of the OEM’s are truly ‘celebrating’ the festive fervor. The increase in the diesel prices boosted the demand for the almost dead petrol cars. The decrease in the interest for car loans came at the right time and pumped the required liquidity confidence in the market at the right time. The ‘UV’olgy still had its grip and even grew this season. October was also the month of new launches – ‘Alto 800’, ‘Ssanyong Rexton’, ‘New Ford Figo’, ‘Manza Club Class’, ‘Safari Storme’ to name a few.
·2) Maruti and Resurgence seems synonymous. It spurted the automobile industry growth for October’12. It crossed the 1 Lakh figure (including exports) after a long interval. It recorded a 94 per cent jump in car sales during the month over the same month last year. The industry leader also launched its new Alto with a fresh ‘wave front’ design. It has already garnered over 30k bookings and the offtake numbers support the fact. Along with K10, the Alto brand had its ever highest offtake figures in past six months with 26600 numbers. The Swift family (Swift hatchback + Dzire) heralded the flag with a combined figure of 29822 units. Ertiga too jumps in the party with an ever-highest billing of 7289 cars. However, the refreshed Ritz couldn’t add any extra ‘JOY’ with its average offtake of 5389 nos.
·3) Notable performance was from Kizashi – with 35 numbers in Oct’12; it equals the combined offtake of past 6 months (35 nos from Apr’12 – Sep’12). The surge was primarily through a 5-Lakh rupee drop in its price J Also the tall blue-eyed boy performs well (13608 units) on the base of confidence in petrol cars post the diesel hike.
·4) The Estilo, SX4 & A-star are still in the dark and seem to slowly loose the sheen with time – with a meager figures of 1217, 695 & 587 units. Can a refreshed avatar change the fortunes of the aforementioned brands? Only time’ll tell.
·5) Mahindra makes waves again. Not only in sales; but in customer satisfaction levels as well. Mahindra emerges as the most improved OEM in Sales Satisfaction Index & Customer Satisfaction Index studies from J.D. Power. The effort has been well applauded with the increased customer orientation levels towards the brand. No wonder an XUV 5oo sells more than all the D-segment cars combined in the same price band.
·Bolero’s take on anything attitude works in its offtake numbers as well. It has been the most consistent brand in terms of sales numbers over several months now. It tastes its best billing till date with 11071 units. Scorpio proves its mettle again with its highest offtake in this FY – 4681 units. Quanto takes the concept of ‘Compact SUV’ to the next level – with over 5k bookings it is successful in dispatching 2044 units to the dealers.
·6) Xylo & Verito figures remain average with 2044 & 1553 respectively. Can we term it as the Quanto effect? It’ll be too early to name that.
·7) Rexton is received well. With launch in only 2 cities (Delhi + Mumbai), its offtake was 80 units. With launch in many more key cities this Diwali, we can expect Rexton to surely challenge the market leader ‘Fortuner’. However, supplies of this Korean magnet needs to be assessed.
·8) The ‘trend-setter’ Hyundai also relishes in the festive hungama with its best month in this financial year. i20 slowly approaches the 10k mark – initially touted to have a fortune similar to Honda’s Jazz; this uber-cool hatch amazes everyone with its sales figures month on month! It even surpasses its younger sibling i10 in terms of sales volumes (i20 – 9058 nos, i10-8988 nos). The recently added Daytime Running Lamps adds to its long feature list and hence allows an hatch owner to enjoy the luxury features of a sedan.
·10) The neo-fluidic Elantra now adds another feather to the Korean carmaker – it consistently tops the sales in its segment (D1) with 668 units. Even the fluidic Verna set the sales chart on fire with 5050 units of offtake.
·11) The OEM that gains the most with the increase in diesel prices is Honda. With 3700 units of Jazz & 3976 units of City, Honda gets justice. We also got to see the preview of the Brio sedan (with its launch in Thailand). We can expect the OEM to create some serious ripples with its to be launched diesel-offerings in the coming months. Even the Honda City-CNG was launched in India this October.
·12) Beat takes a beating – almost de-grew by 50% month-on-month. Was this a UVA-Sail effect? Or else it was an effect of increase in diesel prices and Beat losing its advantage. Maybe both. The UVA Sail is expected to be priced less than a Swift and pose some serious threat to the iconic Swift. But with the average reviews of the Sail, its fate is totally dependent on the customers acceptance.
·13) Tata is experiencing a hard time selling its ‘once’-iconic brands. It also launched a blitzkrieg of “refreshed” indica ev2, manza club class and Safari Storme to subsidize the falling sales. Karl Slym now has a mammoth task to protect Tata’s territory – Ex: it is slowly losing its taxi share of Indica & Indigo to Etios and Liva sisters. Bolero has clearly overtaken Sumo over the years. Safari has now Duster & veteran Scorpio to dare. Aria proves to be a costly affair.
·14) Most importantly Tata Motors need ‘NEW’ product launches to revive. It has already set plans to charter product offensive strategy launch several new products in next 3-5 years.
·15) Renault seems to satisfy all its dealers with a record-shipping figure of 5406 units. It is also expanding exponentially – and is on track to achieve 100 dealers mark by the end of FY. The Scala & Pulse brands are also supporting adequately to the OEM.
·16) Nissan’s dealers decision to oppose Hover Automotive India proves to be a shocker. Nissan’s dealers are unable to understand the reason how Nissan’s partner Renault is successfully bringing in new products and supporting the viability of its channel partners. Nissan dealers have now demanded Nissan’s direct intervention rather than using an intermediary (Hover) to improve the situation.
·17) Toyota continues its dream run with Fortuner & Innova. However, its India-specific products – Etios & Liva are slowly losing their charm. Also their increasing penetration in taxi fleets points Toyota’s desperation to improve the volumes.
18) Yeti with 6 units seems to come to a natural death situation. Skoda also fails miserably to improve its Fabia numbers – 256 units only! The situation is not great in its parent company VW too. With hefty promotions and discounts – only Polo makes a mark in Oct’12.