Racing Past the Barriers The Success of the Apache Motorcycle in India Once upon a time there was a market… Defined by the license raj Demand outstripped supply – Consumers sometimes waited 24 months after full payment for delivery Low product differentiation Two-wheelers the main mode of transport for the middle class Family transport Italian design – but one that came in 4 decades ago And then one day… the flood gates opened New Investment New Investent Capacity multiplied Capacity ultiplied Technological collaboration Technological collaboration Grew hundredfold in 4 decades Grew hundredfold in 4 decades Liberalization Liberalization New wave of consumerism New wave of consueris TECHNOLOGY FUEL EFFICIENCY PRICING India is now the largest and most demanding two-wheeler market in the world Chapter I Market leader. Enviable record of successful launches, sustained growth and profitability Chapter I arket leader. Enviable record of successful launches, sustained groth and profitability Chapter II Slipped to No. 3, lost competitiveness and new launches failed Chapter II Slipped to No. 3, lost copetitiveness and ne launches failed Chapter III Successful innovation and regained leadership by connecting with consumers Chapter III Successful innovation and regained leadership by connecting ith consuers Our Client’s Story Chapter I – Leadership The market leader… then Proud of many Firsts First light motorbike that went on to revolutionize the market First Japanese joint venture First to bring in state of art technology First moped First to use celebrity endorsement Strong R&D Several models launched – new price tiers, increased fuel efficiency, comfort, lightness safety A period of enviable growth and even more enviable profits A good time for other competitors as well But… things change… As they often do Market moved from undersupply to overcapacity. Increased competition More R&D, more claims about more fuel efficiency Several lack luster launches. Shorter product lifecycles TVS had no market success for five years. Products found superior in product clinics failed to perform in the market Price points already crowded. Availability of finance reduced differentiating impact Slipped from No. 1 to No. 3 position. Time to rethink… Innovation needed… but clearly functional performance no longer enough Take a focused rather than a scatter gun approach Understand what the market needed Develop the right proposition Look at needs beyond the functional – explore possibility of building a deeper connection to cut through the functional clutter Consumers Were Not Behaving Rationally What else could explain the less than successful launch of several functionally superior models? Decision to segment market on needs – emotive, social and functional Use of NeedScope e r t iv e s s A n d ly eir F CONSUMER NEEDS BRAND IMAGE Feeling safe and in control Feeling safe and in control Asserting Individuality, Power and Superiority Asserting Individuality, Power and Superiority Feeling accepted, confident and comfortable Feeling accepted, confident and comfortable Breaking free, Pleasures and Thrills Breaking free, Pleasures and Thrills Taking the Emotional Leap forward Needs uncovered at all layers Market mainly operating at functional level Only brand to have broken out of this was Pulsar from competition with enviable success Pulsar promised Potency, a rugged machismo Clearly the market ready for a dialogue and had moved ahead of the marketer We started with qualitative research and found… The Needs Landscape … A motorbike was clearly more than just means of transport Feeling safe and in control li sf i c trl Asserting Individuality, Power and Superiority ssrti I ivi lity, r ririty Feeling accepted, confident and comfortable li cc t , c fi t c frt l Breaking free, Pleasures and Thrills r ki fr , l srs rills Some key insights Modernity at the heart of the category The days of the family of five on a scooter with groceries were long gone Stability, reliability, trust – TVS strengths were now taken for granted. Important, but no longer differentiating New brand would therefore need to stand alone To succeed, thinking and functioning of company stalwarts had to find a new direction Æ focus & differentiating Successful brand differentiation had to be at the emotive level Potency – 28% A love of risk & adventure Conquering, pushing limits Exclusivity – 13% Feel better than others Sophisticated, discerning Efficiency – 13% Enable efficiency, success, with ease & convenience Compensation – 13% Dreaming of a life that can be Belonging – 12% To fulfill role as provider To belong to peer group Liberation – 21% Fun times, First found freedom, Exploration. Wonder Years Six need states Clear evidence of archetypes And importantly, when segmented on emotion, functional direction emerged as well s iv i t y ul c x E C n g in g ol e B TVS portfolio missing the action CD Dawn Boss Crux Caliber 115 Wind Splendor Passion Velocity Freedo m Centra Victor Crux-R Libero Pulsar CBZ Ambition Karizma GF 170 Fiero F2 Eliminator Machismo Bullet 350 Bullet Electra Enticer TVS Brands T rands 49 % of the market. Growth segments indicated by the brands present in these 49 of the arket. roth segents indicated by the brands present in these Liberation chosen as the target to focus on Potency, while larger and exciting had a formidable competitor in Pulsar. Risk of becoming a ‘me-too’ And while new brand aimed to stand alone, still needed the reassuring signature of the make company Liberation a better fit with TVS’s affiliative imagery Liberation had a younger skew. Offered potential to enlist an emerging buyer segment – the first time owner With its expressive, fun imagery reflected the mood and optimism of young modern India Liberation – Life, Here I come The bike symbolizes a rite of passage – the boy becomes a man And with it comes exploration, freedom, liberation Physical sense - about mobility. Emotionally - about reaching places you’ve never been Kick and excitement of youth Discovery of adulthood The Wonder years Liberation – Life, Here I come Definite younger skew, but extends to the Young at Heart Youth –a symbol to flaunt adult status (girlfriend for fun, romance). Older men – flaunt evergreen youthfulness Strong peer context. Affiliation, togetherness reflected in relationship (bike a buddy to share fun with) Product promise – combination of speed, power, trendy looks Advanced technology. While all brands were boasting ‘international collaboration, deliberately kept ‘Indian’ The Result Living life in the MOMENT A buzzing, happening youth But ALSO touching that part of EVERY MAN that brings back the Wonder Years – Freedom, of Irresponsibility, of LIVING Aligning Channels and Promotion Linking in the functional seamlessly Perfect Harmony A Brand Which Connects at All Levels Product Features Stylish looks, really cool accessories, power and pick up, lightness to reflect the mood, easy maintenance Social Identity Unattached, young men, popular with girls Lots of friends doing things together Symbolism – Living life in the moment Irreverence, trendy, but endearingly Indian, Enjoying the moment while it lasts Wonder years – freedom, girls, exploration, friends, experience Reason to Believe Driven by people identified with, not celebrities Rage of the moment Co-sponsorship and partnership of events and promotions – on Channel V and MotoGP Advertising Tonality irreverent, but inoffensive Fun, easygoing, defying conventions and conservatism without becoming rebellious or edgy The TVC The Taste of Success The Taste of Success Living the Archetype!! Breaking Brahmin, Engineering, rational mindset Team fun on Friday afternoons observing young people at the pubs and cafes of Bangalore Epilogue With increased competition, dialogue with consumer grows in sophistication Balance of power shifts. Marketing has to shift from push to pull. From product focus to deeper connections with consumer emotion In this market, Apache exemplified bold decision making Recognition of a new level of consumerization Move away from the functional trap Alternative way of segmenting the market to identify opportunity Creating a brand that made a strong emotional connection Æ Create real differentiation for the brand The successful concept was leveraged by execution, implementation and perfect tonality of all marketing contact ‘Notness’ used to avoid temptation – to stay safe or broaden the brand proposition to increase catchment