A case study on the success of maruti in small car segment

1. A case study on:-
Success of Maruti
Suzuki in small
segment cars

2. Reasons for which maruti continues to be
the leader of small segment cars every
year
 Wide Product offerings at different price points: . Suzuki has
launched various models in various segments and hence has
a very good product mix of offerings as different price
points Right from the affordable Alto to the high end SX4,
the company seems to have it all. Maruti has an edge over
its competitors in this aspect.
 Efficient distribution: The first principle of economics is that
if you generate demand, you should have the availability of
the product to cater to the demand. There are many
distribution centres of Maruti Suzuki within any city in India.
Even in the remotest of corner, there will be a Maruti sales
outlet . To add to it Maruti Suzuki has the highest number of
service centres across the country The company seems to
have the structure to succeed.

3. ◦Marketing strategy of cannibalization — In marketing,
cannibalization refers to decrease in sales volume or market
share of one of the product due to introduction of a new
product by the same producer. Maruti-Suzuki believes in the
concept of cannibalization. For instance, if the customer’s
budget is on a lower side, he/she may purchase an Alto
instead of a Wagon-R. therefore, the sales still remain with
Maruti. So Maruti ensures that the customer instead of going
to any of its competitors stays with Maruti-Suzuki.
◦ Excellent mileage, focussed advertisements - Maruti-
Suzuki cars are loved for their superb mileage,it cuts the
overall running cost of the vehicle ensuring that the
customer is spoilt for this particular brand. It is also one of
the first companies in India to focus on advertising the
engine specifications. i.e. the K-series engine. The
advertisements of Maruti Suzuki focuses on Maruti being a
value buy.

4. ◦ Long Association with India — The company
has been associated with the Indian population for more
than 40 years. Right from the now defunct in terms of
production, but ever popular Maruti 800 to high end
vehicles the company seems to have established a strong
bond with the Indian population. Younger India in their
budding years has travelled a lot in this car with their
parents. So they want to take the legacy forward.
◦Lowest TCO ( Total Cost of Operation) - Both the
capital cost and the parts cost are quite cheap compared to
the other competitiors.
◦Economy with technology: Maruti Suzuki’s cars
have always seen as a company producing cars blending
economy with technology. Swift’s initiative of putting a 16-
bit microprocessor on board has proved as one of the major
reasons for its success and that too for the lowest price in
its segment.

5.  Company’s focus on the middle class - The company
through its cars like A-Star, wagon R, Swift, & Swift Dzire
focuses on the middle class whose purchasing power is
rising by the day.
 Shift of the co. towards diesel oriented cars — This has
been a strategic decision taken by the company. 60% of
the cars manufactured by the company are of diesel
engines. The variants of Swift, Swift Dzire & SX4 diesel
variants are very successful.
 Focus on rural markets — Currently, about 26% of
Maruti’s sales come from the rural India. After the 2009
economic meltdown, Maruti Suzuki started concentrating
more on the rural markets. Campaigns like Ghar Ghar
Mein Maruti’ and ‘Mera Sapna Meri Maruti’ targeted to the
rural India have augured well for the company.
 Brand Name : Maruti Suzuki has emerged as a strong
brand name in recent times. Backed with the parent
company Suzuki. It is recognized as a strong player in
worldwide automotive market.