What strategies does maruti suzuki use to shift consumer preferences?
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Five big shifts
Choices aplenty:In 1996, top six models accounted for 93.4 per cent of total industry unit sales. In 2016, top six models contributed under 34 per cent
Shrinking minis: With car penetration in India at 31/1,000 cars, entry-level mini cars still remain the biggest selling model. But its share has shrunk from 41.7 per cent to 8.2 per cent and will shrink further
Shifting center of gravity: More income and higher aspirations mean buyers are buying pricier cars like Swift, Dzire and Hyundai i20 making the compact car over Rs 4 lakh the most popular segment
Undisputed leader: Maruti Suzuki, with a parent deeply focused on India, has maintained and in fact tightened its grip on the roads with four out of top six models from its stable
Two-horse game: Maruti and Hyundai have lorded over the market. It also means other MNCs are yet to get a grip on Indian roads and along with homegrown Tata Motors and M&M
Top Six
Many trends that the data reveals are predictable. The loosening grip of the mini segment (in which Maruti once had the 800 and now Alto, Hyundai has Eon and Renault the Kwid).
In 1996, Maruti 800 had a 41.66 per cent share of total industry unit sales. Today, Maruti Alto still leads the pack with 2.45 lakh sales but its share in total volumes has slipped to around 8 per cent.
In 1996 the top six models contributed 93.4 per cent of total sales signaling a concentrated market with few choices for customers. By 2016, the share of the top six slipped to under 34 per cent, indicating a more fragmented pie and more choices for buyers. Homegrown firms like M&M and Tata Motors have slipped. But even more telling is the fact that most global giants have struggled to get a grip on Indian roads.

In 1996, monthly sales of over 3,200 units could get a car model into the top six — like Mahindra Commander, which sold 38,451 units in 1996. Even the pricier Toyota Qualis, which sold 46,565 units in 2001 on the back of robust demand from the IT outsourcing industry to ferry their staff found a spot in the top six. But the bar for entry into this club has now substantially risen. Today, a Hyundai i20 Elite has to do over 10,200 units a month to get the sixth slot.
With rising incomes, Indians have been upgrading to pricier models. In 1996, while the sub Rs 3-lakh segment — represented by Maruti 800 — occupied over 40 per cent of the market, today over 90 per cent of the market belongs to the Rs 4-lakh plus segment.
By then, India’s passenger vehicle industry and the top six will look very different. Here are some important sub-trends that will play out.

Undercurrents at Play
Government has announced a slew of policy changes by 2020 that will overhaul the regulatory framework around safety and emissions for the industry. For example, airbags will become a standard feature. While compliance will push up car prices across the board, the rise (in percentage terms) will be slightly higher for the price-sensitive minis that need to be upgraded to meet safety norms.
Fuel mix too will see some changes with diesel variants slipping on its appeal. V Ramakrishnan, cofounder of auto consultancy Avanteum, says compliance with new emission norms will widen the pricegap between diesel and petrol variants.

It will likely push up prices of diesel vehicles by 15-20 per cent, almost double those of petrol vehicles whose prices are estimated to rise by 7-8 per cent. In contrast, electric vehi cles are expected to gain popularity.
Share of automatic variants is likely to double from 5-6 per cent today to 10-12 per cent by 2021. And women as a customer segment is likely to grow from 12 per cent to over 20 per cent in the next 5-7 years. This will push car companies to focus on women in both product design and marketing. For example, car dealerships might look to hire more women staff.
The used car industry too will be on a tear, expected to double to 6.6 million units by 2021.
Crystal Ball Gazing
J-Curve growth:With India’s per capita income likely to cross $3,000 by 2020, the demand for cars will see a J-curve growth nudging 5 million mark
Tougher competition: New carmakers like Peugeot, Kia, Daihatsu and a clutch of Chinese firms like SAIC are looking to debut in India soon
Smaller Shares: The volume share of top-six club will decline further as competition and multiplying model options will fragment customer base
Pricier cars: Share of minis will shrink even as the center of gravity shifts to higher price band — some expect it to be in the `10-lakh plus segment
Reign of SUVs: Small SUVs to find a slot in the top-six club. Women buyers to grow sharply. Diesel cars to lose shine while electric to gain. Automatic variants too will grow
Future Gaze
By 2020, the car market in India is likely to hover around the 4.5-5 million mark. Here’s why.
Choices aplenty:In 1996, top six models accounted for 93.4 per cent of total industry unit sales. In 2016, top six models contributed under 34 per cent
Shrinking minis: With car penetration in India at 31/1,000 cars, entry-level mini cars still remain the biggest selling model. But its share has shrunk from 41.7 per cent to 8.2 per cent and will shrink further
Shifting center of gravity: More income and higher aspirations mean buyers are buying pricier cars like Swift, Dzire and Hyundai i20 making the compact car over Rs 4 lakh the most popular segment
Undisputed leader: Maruti Suzuki, with a parent deeply focused on India, has maintained and in fact tightened its grip on the roads with four out of top six models from its stable
Two-horse game: Maruti and Hyundai have lorded over the market. It also means other MNCs are yet to get a grip on Indian roads and along with homegrown Tata Motors and M&M
Top Six
Many trends that the data reveals are predictable. The loosening grip of the mini segment (in which Maruti once had the 800 and now Alto, Hyundai has Eon and Renault the Kwid).
In 1996, Maruti 800 had a 41.66 per cent share of total industry unit sales. Today, Maruti Alto still leads the pack with 2.45 lakh sales but its share in total volumes has slipped to around 8 per cent.
In 1996 the top six models contributed 93.4 per cent of total sales signaling a concentrated market with few choices for customers. By 2016, the share of the top six slipped to under 34 per cent, indicating a more fragmented pie and more choices for buyers. Homegrown firms like M&M and Tata Motors have slipped. But even more telling is the fact that most global giants have struggled to get a grip on Indian roads.

In 1996, monthly sales of over 3,200 units could get a car model into the top six — like Mahindra Commander, which sold 38,451 units in 1996. Even the pricier Toyota Qualis, which sold 46,565 units in 2001 on the back of robust demand from the IT outsourcing industry to ferry their staff found a spot in the top six. But the bar for entry into this club has now substantially risen. Today, a Hyundai i20 Elite has to do over 10,200 units a month to get the sixth slot.
With rising incomes, Indians have been upgrading to pricier models. In 1996, while the sub Rs 3-lakh segment — represented by Maruti 800 — occupied over 40 per cent of the market, today over 90 per cent of the market belongs to the Rs 4-lakh plus segment.
By then, India’s passenger vehicle industry and the top six will look very different. Here are some important sub-trends that will play out.

Undercurrents at Play
Government has announced a slew of policy changes by 2020 that will overhaul the regulatory framework around safety and emissions for the industry. For example, airbags will become a standard feature. While compliance will push up car prices across the board, the rise (in percentage terms) will be slightly higher for the price-sensitive minis that need to be upgraded to meet safety norms.
Fuel mix too will see some changes with diesel variants slipping on its appeal. V Ramakrishnan, cofounder of auto consultancy Avanteum, says compliance with new emission norms will widen the pricegap between diesel and petrol variants.

It will likely push up prices of diesel vehicles by 15-20 per cent, almost double those of petrol vehicles whose prices are estimated to rise by 7-8 per cent. In contrast, electric vehi cles are expected to gain popularity.
Share of automatic variants is likely to double from 5-6 per cent today to 10-12 per cent by 2021. And women as a customer segment is likely to grow from 12 per cent to over 20 per cent in the next 5-7 years. This will push car companies to focus on women in both product design and marketing. For example, car dealerships might look to hire more women staff.
The used car industry too will be on a tear, expected to double to 6.6 million units by 2021.
Crystal Ball Gazing
J-Curve growth:With India’s per capita income likely to cross $3,000 by 2020, the demand for cars will see a J-curve growth nudging 5 million mark
Tougher competition: New carmakers like Peugeot, Kia, Daihatsu and a clutch of Chinese firms like SAIC are looking to debut in India soon
Smaller Shares: The volume share of top-six club will decline further as competition and multiplying model options will fragment customer base
Pricier cars: Share of minis will shrink even as the center of gravity shifts to higher price band — some expect it to be in the `10-lakh plus segment
Reign of SUVs: Small SUVs to find a slot in the top-six club. Women buyers to grow sharply. Diesel cars to lose shine while electric to gain. Automatic variants too will grow
Future Gaze
By 2020, the car market in India is likely to hover around the 4.5-5 million mark. Here’s why.
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