Case study on a successful and failed brand extension in the two wheeler industry

Prepared By:-

Abhijit Dubey(G.L. 103201) Priyanka Mehta(103220) Sarbani Gupta(103223) Tarun Vijay(103232) Akshara Mathur(103204) Javed Khan(103211) Mazhar I.Dilawar(103242)

MARKETING MANAGEMENT ASSIGNMENT

FINAL PRESENTATION ON TVS SCOOTYDEC 06 2010

MBA (PRIST) 1ST SEM 2010-2012 BATCH (MSRMI)

Brand Extension

When a firm uses an established brand name to introduce a new product.

Types Of Brand Extension

LINE EXTENSION:-Apply the parent brand to a new product that targets a new market segment with in a product category the parent brand currently serves.

CATEGORY EXTENSION:-Using the parent brand in a different product category.

Need For Brand Extension

It helps to build the brand into a super brandHelps leverage the strengths of the existing brandSaves costHelps the new brand to acquire instant brand recognition

TVS SCOOTY

Brand ImageTVS SCOOTY was an instant hit among youngsters

because of its easy, safe and efficient riding features.TVS SCOOTY has attained household name status,

having proved to be the perfect mobility solution for urban womankind.

TVS SCOOTY

PARENT BRAND

(1994)

FeaturesENGINE--------------------------------------2 STROKECAPACITY -------------------------------------59.9 CCCOOLING SYSTEM---------------------AIR COOLEDMAX POWER-----------------------------------3.5KWFUEL CAPACITY----------------------------------3.5 LMILEAGE---------------------------------40-42 KM/L

Market scenario of scooter industry

In 1991, share of scooter was about 50% of the total two wheeler demand in the indian market.

In 1994-95,the scooter segment accounted for 46-80% of two wheeler industries crossed the one million mark.

As such scooter segment has grown by 34%-37% which is one of the segment achievements of industry.

Competitive Scenario Prior To Scooty’s Launch

BAJAJ SUNNY.

KINETIC LUNA.

KINETIC HONDA.

Consumers Need

Youth were looking for latest style. Reject a product used by his/her father.Looked for more convenient and youth oriented brands.

Launch of SCOOTY Of imminent threat to moped volumes from SUNNY.Opportunity was noticed after SUNNY’s under

performance.Light weight and easy to handle.

Brand Promise

1994 - to provide youngsters a scooterette with latest fashion and style.

1996 - To try and spot emerging style, fashion and lifestyle trends amongst young woman that can keep scooty as the boldest fashion statement on the road

Target Market

Initially targeted for both the genders.In 1995, 65% of the production was sold to

women because features offered by the product were effeminate.

In 1996, scooty through a repositioning exercise to target women

Brand Positioning

Positioned as a SCOOTY and not a SCOOTER.Light weight.Low cost.Adequate power.Good styling.Simplicity in driving.

Brand communication

Campaign 1(1994):-“It’s a Scooty,Not a Scooter”.

Campaign 2(95-96):-“Dream Machine”.

Campaign 3(96-97):-“At Home in the City”.

To highlight the urban convenience aspect.

Campaign 4(97-98):-“Cool & Easy” with RAAGESWARI.

To blend the attitude of youth(cool) with convenience of the scooty(easy).

Campaign 5(1999 onwards):-“First Love”.

To appropriate companionship a fundamental “first vehicle” value.

Performance Of The Brand

Market Shared gained over SUNNY.LUNA famous brand of Kinetic Engineering started

losing market in Maharashtra and Gujarat.TVS with their Scooty carved as significant chunk of

Kinetic Honda's market share.SCOOTY had a market share of about 16% in the

scooterette segment.

AwardsTVS Motor won the Deming Application Prize in 2002,

becoming the first and only Indian two-wheeler company to win the award given to companies that do outstanding work in the field of Quality Management.

Need for brand extensionMarket was moving towards a four stroke acceptance.With Additional features.

TVS SCOOTY PEP

SUCCESSFUL BRAND

EXTENSION

(2003)

FeaturesEngine----------------------------------------------4 StrokeCapacity-----------------------------------------------75 CCCooling System------------------------------AIR COOLEDFuel Capacity----------------------------------------5 LitresMileage------------------------------------------60 km/litre

Competitive Scenario Prior To Its Launch

Before the scooty pep was launched in the market, the competition was between :

Honda Activa

Honda DIO

Kinetic NOVA

Consumer need

SpeedMore economicLatest style

Brand Positioning

New sleek design.Modifications like stand alert, cell phone charger, light in

the utility box, etc.POD(point of difference)

>In 2005 the Company launched the vehicle with 99 colors as a differentiator from its competitors.

Brand Communication•Campaign 1(2005-08):-TVS Scooty Pep with Brand Ambassador PREITY ZINTA•With PREITY ZINTA as the SCOOTY PEP brand ambassador ,TVS accelerated its popularity further.

-her youthfullness,style and contemporary looks exemplified the brands attributes.

•Campaign 2(2008):-TVS Scooty Pep+. “Mujhe hai bas tennis se pyaar(I only love Tennis)”.•Campaign 3:- TVS Scooty 99 Colors “What’s your shade of you”.

Performance Of The Brand Resulted in 24 % growth in volume with TVS having

sold 1,89,261 in April 2003 - March 2004.

Unprecedented growth of 43% during the 3rd quarter in the scooterette category, far higher than the industry growth rate of 18%.

Market Shares 1995-1996 2005-06

* HMSI – HONDA MOTORCYCLE AND SCOOTER INDIA

Awards

In 2004, TVS Scooty Pep won the 'Outstanding Design Excellence Award' from Business World magazine and the National Institute of Design,Ahmedabad.

Need for the next brand extension

Concerns for the environment and rising fuel prices.  

Lured by the growth of the ebikes and escooters TVS forayed into the segment with this new scooter.

TVS SCOOTY TEENZ ELECTRIC

FAILED BRAND EXTENSION

(2007)

FeaturesRange/Autonomy------------------------------50

kmTop Speed------------------------------------40

km/hBatteries---------------------------------- 48V

20AHVoltage--------------------------------------------

48VCharger---------------------------------48V portable

Consumer needTargeted at women who need mobility, but at lower

ownership costs and whose daily travel is limited to around 15-25km per day.

Competitive Scenario Prior To Its Launch

Before TVS TEENZ Electric launched,YO BYKES captured the market.

Failed PositioningPoor demand of the electric variant of TVS Scooty Teenz

Electric.Introduced in the market in April 2008 but stopped

production in May 2009

Technical Reasons For FailureBattery gets dischrged with in 6 months.Charging takes 7 hrs and barely goes 30km with one

charge.Tyre gets frequent punctures, brake lining gives heavy

sound.Pick up of the bike goes down considerably with in a

year.

CONCLUSION

Reasons for the success of Scooty pep

Scooty maintained its brand promise by introducing its new product in the line extension- “Scooty pep”

By launching scooty pep plus with additional wheels that worked as balancing wheels and through its commercial ads it communicated the message of WOMEN EMPOWERMENT.

With commercial ad like ‘pink se panga mat lena’ it tried to convey the message ‘don’t mess with girls’,to reinforce the position of the girls in the society.

An ad commercial where a lady doctor thanks her parents for buying her a scooty pep highlighted the benefits in personal progress of owning a scooty pep.

Scooty pep and its variants added to the social causes of women giving them independency of movement and giving them an opportunity to participate in the society.

Reasons for the failure of scooty teenz electric

This extension of scooty brand could not maintain the brand promise .

It was launched keeping in mind the environmental issues and economical issues and overlooked the latest fashion and trend .

Girls could associate more with the product scooty pep because it tried to manifold itself according to their wants and met their real,unstated and secret needs which scooty teenz electric could not.

Analysis Of Data And Interpretation

Potential success of a brand extension is judged by how effectively it leverages existing brand equity from the parent brand and, in turn, how effectively it contributes to the parent brands equity.

Successful brand extension occur when the parent brand is seen as having favourable associations and there is perception of ‘fit’ between the parent brand and the extension product.

Failure of brand extension occurs when customer’s positive associations with the parent brand becomes negative in the extension context.

Scope of TVS ScootyScooty as a brand has firmly positioned itself

in the minds of its target customers.Since 1996 the brand has undergone

continuous innovations to better satisfy consumer needs so as to maintain its leading position in the segment.

Scooty may thus follow its existing trend of line extension because the economy is in rapid growth and there is fast advancement in the lifestyle of the society.

Any queries

We deeply express our sincere thanks to the TVS bike dealers of MEGHDOOTH showroom in M.G.Road for their guidance, co-operation and valuable informations.We would also like to take this opportunity to thank our marketing management faculty Mrs.ANITA S.KUMAR for her valuable Guidance,Encouragement and constructive criticisms through out the duration of our project.