Brand positioning of_automotive_lubrican

The International Journal Of Management
43 Vol 2 Issue 4 (October, 2013) www.theijm.com
Brand Positioning Of Automotive Lubricant In Indian Market
1.Introduction
1.1.Brand Positioning
Kotler aptly defines positioning as the ‘the act of designing the company’s offer so that it occupies a distinct and valued place in
the mind of the target customers.
Bovee et al defines positioning as the ‘the process of promoting buyers to form a particular mental impression of our product
relative to our competitors.
David Aaker considered Brand Positioning a ‘part of brand identity and value proposition that is to be actively communicated to
the target audience, and that demonstrates an advantage over competing brands.’
Branding is the “added value” or augmented elements that determine a brand’s positioning in the market place.
Al Ries and Jack Trout said that to develop a positioning program, six critical questions must
be answered. They are;
 What position do you own in the mind of the prospect, now?
 What position do you want to own?
 Whom must you outrun to achieve that position?
 Do you have enough money?
 Can you stick it out?
 Does your communication match your position?
The market position of a brand shows where a specific brand is located. It also shows the relationship to competitive brands. We
can determine the market position of a brand on the basis of the answers to the following four questions:
 Why (which benefits and advantages does the brand bring to the consumers).
 When (determining the opportunities for which the brand is most suitable).
 For whom (it is about the determination of the consumer of a brand or target group).
 Against whom (determining the main competitive brands).
Gautam Srivastava
Research Scholar, University Of Petroleum And Energy Studies, Dehradun, India
Abstract
This research paper is based on the impact of brand positioning on the consumer purchase decision of lubricant consumers.
First of all researcher has found the different attributes of brand positioning . The attributes of brand positioning are
independent variables whereas the attributes of consumer purchase decision are dependent variables. After that the
researcher has found the relationship between the attributes of brand positioning and consumer buying behaviour by using
multiple regression analysis. So this research helped the PSUs to find out the important factors on which they should focus to
increase their market share. Multiple dimensional scaling has been used to identify the important dimensions of brand
positioning based on consumer perception. Different brand has been mapped on perceptual mapping to determine the points
of parity and points of differences.
Key words: Brand positioning, Perceptual mapping, PSUs, Multiple regression analysis
ISSN 2277-5846
THE INTERNATIONAL JOURNAL OF MANAGEMENT

Product positioning is an important strategy for achieving differential advantage. Positioning reflects the “place” a product
occupies in a market or segment. A successful position has characteristics that are both differentiating and important to
consumers.
1.2.Tips Of Brand Positioning
All forward looking companies now regard positioning at the heart of competitive strategy. As the ultimate aim of any business
strategy is to satisfy the customer, gaining a valued position in the minds of customers is essential. Some people argue that
branding is really positioning, stating that unless a brand has a position, it has no unique value in the minds of consumers. You can
establish a brand personality, and through precise market segmentation identify and reach your target audience, but what links
them together is positioning the brand in the minds of that audience. But, what is a position and how do you arrive at a good
strategy for achieving one.
The branding process seeks to create a unique identity for a company, product or service, which differentiates it from the
competition. And every brand has to have a strategic platform. One half of that platform is created by carefully by carefully
formulating a distinct brand personality, which makes the identity of the brand unique. The other half of the strategic brand
platform is positioned. Positioning is critical to brand building because it is responsible for projecting the brand identity and
creating the perception and image of the brand in people’s minds. In other words, positioning is the process of offering the brand
to the consumer. It is positioning that makes the brand appear to be different and better than all competing brands.
Keller et al argue that managers often pay too much attention to points of differentiation but pay little attention to two other
aspects. Frame of reference and brand’s common features with competitors. Effective competitive positioning does not require
only paying attention to points of differences but also to points of parity. Exclusive focus on creating points of differences often
causes the managers to ignore another important issue. That is, the point of reference that customers use to see and evaluate the
brand. For instance, a fast food brand tries to differentiate itself from the other players in the fast food category on the key
proposition of health. But a brand so promoted on the health platform may change the point of reference customers use to judge
the brand. Customers may see health and taste as two different categories. Thus, differentiation so pushed on the health basis may
pull the brand out of the fast food category and place it in the health food category. Each category may have different size and
growth prospects. Such moves should be deeply contemplated upon before being pursued.
Once the point of reference is correctly established, the next positioning challenge is creating compelling points of differences.
Mere promotion of the brand on the basis of differences is not a good strategy. Developing strong, favourable and unique
associations are fundamental to creating effective brand differentiation. Three ways of building differentiation could be identified:
brand performance, brand imagery and consumer insights. Depending upon the route chosen, the brand associations could be
developed accordingly.
A brand could develop distinction in a chosen field by developing associations related to product performance. It focuses on the
brand’s delivery on the functionality expected by customers. The brand could develop associations on the intrinsic product
dimensions like durability, reliability, price, style or service.
A brand can take the imagery route to developing strong, favourable and unique associations focusing on user and usage situations
in communication. The class of people who are associated with the brand often differentiated brands powerfully. Brands like Rolls
Royce and Armani draw their imagery from the class of people who are considered users of these brands. On the other hand, the
ordinary or average person imagery is also an effective way of differentiating a brand. Brands like Wheel and Fair & Lovely seek
to connect with ordinary households who want solutions to the washing and dark skin problems being faced by housewives and
young girls respectively.
Finally, when the above two methods of differentiation do not provide much scope for differentiation, the marketer can turn to
consumers for possible insights into their problems or goals, in order to position the brand. For dishwashing, brand Vim was for
long promoted as a means of winning acceptance and approval from a demanding mother in law. Close Up toothpaste attracts
young customers by subconsciously making them ever ready to face a close encounter and thereby reduces imagined insecurities.
Establishing a correct point of reference and points of differences is important for competitive positioning. A brand must first
signal the category it wants to participate in, through parity associations. Then it must create compelling points of differences to
differentiate itself from the rest in that frame.

Figure 1: Kevin Killer Model Of Brand Positioning
This model is used to identify the optimal positioning and value proposition for the brand.
It helps to consider for effective brand positioning.
 Differentiated from the competition
 Relevant to its audience
 Defendable by the product
 Aligned with the core brand values
Dr Kevin Killer has suggested a model for effective brand positioning. This model is able to answer the following questions:
 What do the brand consumers presently believe about or value in the brand?
 What might consumers believe or value about the brand in the future?
 What is the organization currently claiming about the brand?
 What would the organization like the brand to become down the road?
Figure 2: Kelvin Killer Model
Source: Dark Matter Matters
1.3.Lubricant Oil
Lubricating oil is used to reduce the friction between the moving surfaces. The property of reducing the friction between the
surfaces is called lubricity. The lubricant oil have following characteristics:
 High boiling point
 Low freezing point
 High viscosity
 Thermal stability

 Hydraulic stability
 Corrosion prevention
The function of lubricant is to separate the moving parts in the system.
 Keeping moving parts apart
 Reduce friction
 Transfer hit
 Transmit power
 Protect against wear
 Prevent corrosion
 Seal for gases
India is the third largest lubricant market in the world after the U.S.A. and China. India produces 5 to 6 percent of the total global
lube production. The Indian lubricant market is mainly divided into two parts industrial lubricant and automotive lubricant. Indian
automotive lubricants constitute 65% whereas industrial lubricant oil constitutes 35% of the market share. The majority market
share of the India lubricant market is covered by automotive lubricant. Presently the Indian lubricant market is growing at the rate
of 5% per annum.
Year Rate
1990-91 - 1996-97 2.5%
1996-97 - 2001-02 2.0%
2001-02 - 2006-07 4.5%
2004-05 - 2009-10 3.5%
2009-10 - 2014-15 4.0%
Table 1: Growth Trend Of Indian Automotive Lubricants Market
Source: http://www.Indiastat.Com (2012)
The India auto lubricant manufacturer produces classified into two types:
Company Name Brand Name Major Product
Bharat Petroleum
Corporation Ltd.
MAK MAK Supreme, MAK Multigrade, MAK Gold, MAK Gold Plus,
MAK Diamond
Hindustan Petroleum
Corporation Ltd.
HP HP Extra Super Motor Oil, HP Cruise, HP Racer, HP Laal Ghoda,
HP Milcy Power, HP Pumpset OIL
Indian Oil Corporation
Ltd.
SERVO SERVO 2T Supreme, SERVO Pride, SERVO Ultra, SERVO
Premium
Table 2: Psu’s – Indian Oil Corporation, Bharat Petroleum Corporation Ltd., Hindustan Petroleum Corporation Ltd.
Company Name Brand Name Major Product
Castrol India Ltd. Castrol Castrol GTX Modern Engine , Castrol GTX 20W50
Castrol Edge , CASTROL GTX DIESEL
Gulf Oil Corporation Ltd. Superfleet Superfleet LE Max 15w-40, Superfleet Max 15w-40, Gulfco 1049 Max
Tide Water Oil
Corporation Ltd
Veedol HDB 30, 40, 50, HDB 20W, 40, HDB 30, 40, HDC30, 40, HDC Fleet
30, 40
Table 3: Private Lubricant Manufacturer- Castrol Indian Ltd., Tide Water Oil Corporation Ltd., Gulf Oil Corporation Ltd.
Indian Lubricant market in India divided into diesel lubricant and petrol lubricant.
Market size and Demand of Lubricant Oil in India

Figure 3
Source: www.scribd.com
The original equipment segment and retail trade are the two major marketing channels in the Indian automotive lubricants market.
PSUs sell their lube oil through petroleum retail outlet whereas major private players like Castrol sell their lubricant through
bazaar trade.
2.Literature Review
PSUs companies have lost market share from 90 percent in 1991 to 58.5 percent in 2012. The increasing dominance of Castrol, a
well enriched MNC in the lube oil sector, has added their woes. Castrol, which had a market share of six percent in 1991 had
increased it to 18 percent. To major gainers in market shares during this period are Tide water oil and Gulf oil India (A Hinduja
group).
Figure 4: Market Share Psus In Lubricant Oil
Source: The Financial Express, June 7, 1997
3.Motivation Of The Research
 Indian lubricant market is the third largest in the world.
 Demand of auto lubricant in Indian market is increasing continuously.
 PSUs (IOCL, BPCL and HPCL) are continuously losing their market share.
4.Statement And Proposal
 Business Problem
Loss of market share of PSU in Lubricating Oil. (IOCL, HPCL and BPCL).
NOTE: During the 90’s the market share of the PSU Lubricant sector were 90% and currently it is 60%. Now a days PSU is
spending significant amounts on Brand Positioning to influence consumer behaviour which was missing during 90’s.
5.Research Objectives
 To determine the important attributes of brand positioning of lubricant oil.
 To determine the impact of important attributes of brand positioning of lubricant oil on consumer purchasing decision.
30%
70%
Petrol Lubricant
Diesel Lubricant
90
58.6
0
20
40
60
80
100
1991 2012
P
e
r
c
e
n
t
a
g
e
Year

6.Scope Of Study
PSUs lubricant brand (Servo, Mac and HP Lube) is continuously losing their market share in the Indian lube market. So this
research is focused on finding the important attributes of brand positioning which affects the purchasing decision of lubricant
consumer which helped the PSUs to increase their market share by repositioning their brands.
Year Personal Vehicles Commercial Vehicles Total
Personal
cars & Jeeps
Vehicles. M.
cycles/Scooters
Auto
Rickshaw
Taxis Buses Good
Vehicles
1980-81 22.48 64.13 3.83 1.20 1.52 6.85 100
1990-91 21.74 67.51 3.51 0.57 1.06 5.61 100
2000-01 26.64 64.53 2.52 0.53 1.20 4.59 100
2006-07 30.66 63.64 1.43 0.48 0.90 2.89 100
2007-08 30.73 63.58 1.33 0.54 0.93 2.85 100
2008-09 30.92 63.17 1.40 0.66 0.91 2.91 100
2009-10 31.21 62.85 1.34 0.70 0.89 2.99 100
2010-11 31.34 62.64 1.27 0.84 0.89 3.02 100
2011-12 31.50 62.43 1.19 0.94 0.86 3.08 100
Table 4: Percentage Distribution Of Registered Vehicles Of The Total
Source: Offices Of State Transport Commissioners
7.Research Design
7.1.Exploratory Research
Exploratory research has been used to find out the different factors responsible for brand positioning of lubricant oil and the
impact of that factors on consumers purchasing decision.
7.2.Descriptive Research
Descriptive research has been used to find out the relationship between the attributes of brand positioning and consumer
purchasing decision.
8.Sources Of Data Collection
8.1.Sources Of Data
8.1.1.Primary data
Primary data will be collected from the four strata:
Four Wheeler segment consumers
Four wheeler segment consumers will be divided into the following strata
• Non commercial four wheeler (petrol)
• Non commercial four wheeler (diesel)
• commercial four wheeler (petrol)
• commercial four wheeler (diesel)
8.1.2.Secondary Data
Secondary data are required for the study and will be collected from the annual report of the lube companies, magazines.
8.2.Sampling
Total No. Of four vehicles in Delhi = 2412893 (Source: Population census 2011)
The sample size will be calculated by using Yamane, 1967 formula.
n = N
1 + N e2
Where n = The sample size
N = The size of the population
e = The error of 5 percentage points.
n = 2412893
1 + 2412893 (.05) 2
= 399.93
= 400

8.3.Area of Sampling
The sample will be collected from the Delhi region.
Delhi region will be divided into following sub region:
East
West
North
South
Central
The sample size will be divided in the ratio of commercial and non commercial four vehicles which are registered in Delhi. A
further four vehicles are further classified on the basis of the ratio of petrol and diesel four vehicles.
8.4.Sampling Techniques
Convenience sampling will be used. The researcher will collect the data from the different petrol pump by asking drivers, owners
and users fill up the questionnaire.
8.5..Hypothesis
 H0: Brand positioning does not have any impact on consumer purchasing decision of lubricant oil.
 H1: Brand positioning has an impact on consumer purchasing decision of lubricant oil.
8.6.Factor Analysis
Factor analysis has been used to find out the most important following factors:
 Price
 Quality
 Accessibility
 Consumer Benefits
Standard attributes of consumer buying behaviour has been used which is following:
Purchase Decision
The purchase decision is a dependable variable of consumer buying behaviour whereas price, quality, accessibility and consumer
benefits are the independent variables of brand positioning.
8.7.Reliability Analysis
Reliability analysis has used to measure the reliability of the factors price, quality, accessibility and customer benefits. It is used to
measure that whether these factors are able to measure the satisfaction of lube consumers.
Table 5
Reliability Statistics
Cronbach's Alpha Cronbach's Alpha
Based on StandardizedItems
N of Items
.214 .225 4
Table 6
Item Statistics
Mean Std.
Deviation
N
Price 2.41 1.421 99
Quality 2.17 1.204 99
Accessibility 2.78 1.337 99
Consumer Benefits 2.25 1.063 99
Table 7
Case Processing Summary
N %
Cases Valid 99 98.0
Excludeda
2 2.0
Total 101 100.0
a. List wise deletion based on all variables in the procedure.

Inter-Item Correlation Matrix
Price Quality Accessibility Consumer
Benefits
Price 1.000 .137 .049 .207
Quality .137 1.000 -.249 .022
Accessibility .049 -.249 1.000 .241
Consumer Benefit .207 .022 .241 1.000
Table 8
Summary Item Statistics
Mean Minimu
m
Maximu
m
Range Maximum /
Minimum
Varianc
e
N of
Items
Item Means 2.404 2.172 2.778 .606 1.279 .072 4
Item Variances 1.597 1.129 2.021 .891 1.789 .152 4
Inter-Item Correlations .068 -.249 .241 .490 -.969 .029 4
Table 9
Item-Total Statistics
Scale Mean if
Item Deleted
Scale
Variance if
Item Deleted
Corrected
Item-Total
Correlation
Squared
Multiple
Correlation
Cronbach's
Alpha if Item
Deleted
Price 7.20 4.306 .217 .062 .021a
Quality 7.44 6.433 .045 .087 .349
Accessibility 6.84 5.749 .011 .124 .300
Consumer Benefits 7.36 5.111 .284 .099 .043a
Table 10
In the above table all the value of Cronbach’s Alpha is positive which shows that the variables are fit into the reliability model
8.8.Multiple Regression Analysis
Multiple Regression has been used to find out the relationship between the independent variables Price, Quality, Accessibility and
Customer Benefits and dependent variables consumer purchase decision.
Descriptive Statistics
Mean Std.
Deviation
N
PurchaseDecision 1.28 .453 99
Price 2.41 1.421 99
Quality 2.17 1.204 99
Accessibility 2.78 1.337 99
Consumer Benefits 2.25 1.063 99
Table 11

Correlations
Purchase Decision Price Quality Accessibility Consumer
Benefits
Pearson
Correlation
Purchase Decision 1.000 .038 -.034 -.030 .083
Price .038 1.000 .137 .049 .207
Quality -.034 .137 1.000 -.249 .022
Accessibility -.030 .049 -.249 1.000 .241
Consumer Benefits .083 .207 .022 .241 1.000
Sig. (1-tailed) Purchase Decision . .354 .370 .384 .206
Price .354 . .088 .315 .020
Quality .370 .088 . .007 .416
Accessibility .384 .315 .007 . .008
Consumer Benefits .206 .020 .416 .008 .
N Purchase Decision 99 99 99 99 99
Price 99 99 99 99 99
Quality 99 99 99 99 99
Accessibility 99 99 99 99 99
Consumer Benefits 99 99 99 99 99
Table 12
Table 13
Table 14
Table 15
Coefficient Correlationsa
Model Consumer
Benefits
Quality Price Accessibility
1 Correlations Consumer Benefits 1.000 -.058 -.191 -.243
Quality -.058 1.000 -.140 .264
Price -.191 -.140 1.000 -.036
Accessibility -.243 .264 -.036 1.000
Covariances Consumer Benefits .002 .000 .000 .000
Quality .000 .002 .000 .000
Price .000 .000 .001 -4.492E-005
Accessibility .000 .000 -4.492E-005 .001
a. Dependent Variable: Purchase Decision
Model Summary
Model R R
Square
Adjusted
R Square
Std. Error
of the
Estimate
Change Statistics
R Square
Change
F
Change
df1 df2 Sig. F
Change
1 .114a
.013 -.029 .459 .013 .310 4 94 .871
a. Predictors: (Constant), Consumer Benefits, Quality, Price, Accessibility
ANOVAa
Model Sum of Squares df Mean Square F Sig.
1 Regression .262 4 .065 .310 .871b
Residual 19.819 94 .211

8.9.Multi Dimensional Scaling
Table 16
Multi Dimensional Scaling has been used to measure the perception of consumers towards the different brand of lubricant oil.
First of all two dimensions price and quality has been identified on the perceptual map on which perception of consumers towards
different brands has been mapped.
After that consumers perception responses have been mapped on the perceptual map.
8.10.Perceptual Mapping
Perceptual map has been used to map the different brand of lubricant oil on two attributes price and quality.
Following brand has been mapped on the perceptual mapping:
 Servo
 MAK Lubricant
 HP Lube
 Veedol
 Superfleet
Step 1: Perceptual Map of the lubricating oil in Indian market.
Step 2: Entered the two labels of the horizontal axis
For the upper side of the map Low Price
For the bottom side of the map High Price
Step 3: Entered the two labels of the vertical axis
For the left side of the map High Quality
For the right side of the map Low Quality
Step 4: Entered the brand to be mapped
Step 5: Scored each brand for the two attributes price and quality
Used a 1 to 9 scale
Horizontal attributes
1 = Low Price
5 = Equal mix of both
9 = High Price
Vertical Attributes
1 = Low Quality
5 = Equal mix of both
9 = High Quality
Step 6: Size of the circles shows the market share of the different brands.
1 = Small
5 = Medium
9 = Large
Table 17
Collinearity Diagnosticsa
Model Dimension Eigenvalue Condition
Index
Variance Proportions
Constant Price Quality Accessibility Consumer
Benefits
1 1 4.341 1.000 .00 .01 .01 .01 .01
2 .274 3.982 .00 .02 .43 .22 .03
3 .202 4.641 .01 .91 .16 .04 .01
4 .131 5.766 .01 .03 .02 .31 .88
5 .053 9.067 .98 .04 .38 .42 .07
a. Dependent Variable: Purchase Decision
Brand Horizontal axis Vertical axis Size of the circles
Servo 6 7 3
MAK Lubricant 7 6 2
HP Lube 7 5.5 1
Castrol 5 7 3
Veedol 8 4 1
Superfleet 8 3 1

Figure 5
Figure 6
Servo
Mak Lubricant
HP Lube
Castrol
Veedol
Superfleet
Perceptual Map of Lubricant Oil Brand in Indian Market
Healthy
Limited Choice
LowQuality
High Price
Low Price
HighQuality
0
1
2
3
4
5
6
7
8
9
0 2 4 6 8 10
Price
Quality
BranServo
Mak
HP Lube
Castrol
Veedol
Supeerfleet

Figure 7
9.Conclusion
With the help of factor analysis for factors price, quality, accessibility and customer benefits. Multiple regression analysis has
been used to find out the relationship between the independent variable price, quality, accessibility and customer satisfaction and
the dependent variable purchase decision. Multiple correlation coefficient concludes that the Pearson correlation coefficient
between purchasing decision and the price is 0.38, purchasing decision and consumer benefits is 0.83, purchasing decision and
quality is -0.34, purchasing and accessibility is -0.30. It means there is a positive correlation coefficient between purchasing
decision and price, consumer benefits whereas there is negative correlation between the purchasing decision and quality,
accessibility. Major brand of lubricant oil Servo, HP Lube, MAK Lubricant, Castrol, Veedol and Superfleet has been mapped on
perceptual map. The two dimensions of perceptual map are price and quality.
10.Limitations
 This research will be limited only to Delhi region.
 This research will be limited to four wheeler segment (Petrol and Diesel).
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