Measuring Customer Satisfaction in Hero Motors

1. INTRODUCTION TO THE PROJECT
The project is all about measuring the customer satisfaction in Hero motors. For the past
few years every company is trying to satisfy its customers. The emphasis is on ways of
retaining customers, then on attracting new customers. It is easy to attract new customers then
to retain old customers. So, companies are trying to focus on this aspect of customer‘s
satisfaction.
The sale of a product does not end with the sale transaction but it is the point at which
the original marketing concept starts. The marketer has to see that whether the customer
satisfied with that particular product/service or not. The post purchase behavior is important for
a marketer. If there is any cognitive dissonance in the minds of the customers then that is
enough to lose a customer. Keeping this in mind the companies are giving more importance to
customer satisfaction.
This project work has been done to find out whether a customer is satisfied or
dissatisfied, also to measure the level of the customer satisfaction and provide this feedback to
the company. The first phase of the project involves the collection of information from the
customers for interpreting the characteristics based on which the customer feels satisfied or
dissatisfied. This information is collected by preparing a structured questionnaire. The
questionnaire consists of both open-ended and closed-ended questions. The questionnaire is
designed in such a way that a customer feels convenient to answer.

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Garden City College of Science & Management Studies

The collated information through the questionnaire is analyzed and presented in a
statistical form. The findings are listed and suggestions to solve problems faced have been
given in the suggestion part.

INTRODUCTION TO CUSTOMER SATISFACTION
Whether the buyer is satisfied after purchase depends on the offers performance
in relation to the buyer expectation. In general satisfaction are a person‘s feelings of pleasure
or disappointment resulting from comparing a products perceived performance relation to
his/her expectations. If the performance falls short of expectation, the customer is dissatisfied.
If the performance matches the expectation customer is satisfied. If the performance exceeds
the expectation the customer is highly satisfied.
Customer satisfaction cannot be very difficult. After all you either satisfied with
the services you receive or you are not. If you don‘t you are not. If it is that easy, then obtaining
people's opinion about how satisfied they are with relatively straight forward matter- or is it?
Customer satisfaction is a marketing tool and a definite value added benefit. It is often
perceived by customers as important as the primary product or service your organization offers.
It looks at what is involved from 3 different angles, the first is from the view of an organization
wishing to understand, and measures, how satisfied its customer are with the products and
services they receive from it. The second is from the perspective of a research agency that has
been asked to obtain feedback from customers and about their experiences when dealing with
companies. Finally it considers the issue from the perspective of consumers who participate in
surveys, including both business customers and members of general public
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MEANING OF CUSTOMER SATISFICATION
Customer satisfaction is a business term, is a measure of how products and services
supplied by a company meet or surpass customer expectation. It is seen as a key performance
indicator within business and part of the four prospective of balanced score card.
In a competitive market place were businesses compete for customers, customer
satisfaction is seen as a key differentiator and increasingly has become a key element of
business strategy customer satisfaction drives successful private sector business.
High performing businesses have developed principles and strategies for achieving
customer satisfaction. This paper presents a framework or set of ideas for using customer
satisfaction principles and strategies to improve the quality responsiveness, and possibility of
public sector privately provided services in vulnerable communities
The framework suggested that resident who live in tough neighborhoods can be supported
through customer satisfaction strategies to become empowered individuals who informed
perspectives influence decisions about what, how, when, and where services are available to
them.
Customer satisfaction is the customer‘s response to the evaluation of the perceived
discrepancy between prior expectation and the actual performance of the product as perceived
after its consumption.

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DEFINITION
Cocotte, woodruff and Jenkins (1987) define customer satisfaction as "conceptualized as a
feeling developed from an evaluation of the experience."
HERE, the timing of satisfaction response is driving consumption.
BUT there is general agreement with kotler (2003) that "customer satisfaction is a
person's feeling of pleasure or disappointment resulting from comparing a products perceived
performance in relation to his or her expectation." In short customer satisfaction is "The
provision of goods or services which fulfill the customer expectation in terms of quality and
service, in relation to price paid."

IMPORTANCE OF CUSTOMER SATISFACTION
It costs at least 7 times more to source a new customer than it does to retain existing
one a 'satisfied' customer tells 5-7 people in a year whilst a 'dissatisfied' customer will tell 14-15
people.
Companies can boost profits anywhere from 25% to 125% by retaining a mere 5%
more of their exciting customers.
Totally satisfied customers were 6 times more likely to use that services and commend
it than ' satisfied' customers.

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Customers who have a bad experience with you and do not complain are only 37%
likely to still do business with you.
Customers who have an opportunity to complain and the complaint is achieved are
95% likely to still do business with you.

FACTORS OF CUSTOMER SATISFACTION
1. Service of quality
2. reliability of service
3. knowledge of the staff
4. Being kept informed of progress
5. The way service kept its promises
6. The way the service handled any problem Friendliness of staff
7. How sympathetic staff were to your needs
8. Speed of enquiries
9. Number of time had to contact the service.

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2. REVIEW OF LITERATURE
Planning for the future to achieve the long-term objective is integral to the
survival and growth of every business. Strategic planning today has to take into cognizance
the rapid changes in technology, increased competitiveness and the turbulent business
environment, also with the world becoming one big global village.
Strategy covers every aspect of business from business reengineering, new business
development, product development and brand positioning to advertisements promotional
campaigns, media and publicity. It is a game of innovation.
In fact, marketing people are involved in marketing 10 types of entities; goods,
services, experience, events, persons, places, properties, organizations, information and ideas.
Marketing management is the art and science of choosing target markets and getting, keeping
and growing customers through creating, delivering and communicating superior customer
value.
India is second largest manufacturer and producer of two-wheelers in the world. It
stands next to Japan and China in terms of the number of two wheelers produced and
domestic sales respectively.
Indian two-wheelers industry made small beginning in early 50‘s when Automobile
products of India (API) started manufacturing scooter in India. Hero was established on 13 th of
April 1984. The Indian two wheelers Industry can be broadly classified as scooter, motorcycles
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and mopeds/scooters. In last six years domestic two-wheelers has seen structural charges.
This can be seen from the change in composition of two wheeler sales, where the motorcycles
have gained market share from the scooter and moped or scooters segments.
The consumer is now faced with proliferation of brand models. Getting new customers as well
as retaining them is an important task of manufacturers. So service after sales is very
important. A satisfied customer brings in more name and goodwill to the company, which is
why customer satisfaction is given more importance in today‘s competitive world. A study on
this aspect with Hero two-wheelers at Hero MotoCorp Ltd was made.

STATEMENT OF THE PROBLEM
This Project has been titled ―A comprehensive study Post purchase buyer behavior and
satisfaction towards Hero Motors Bikes after the split with Honda."
To study the new market of Hero motors after the split with Honda, the consumer response to
the bike and needed improvement aria
The study would help to understand the consumer satisfaction to their expectation.
OBJECTIVES

This study was conducted keeping the following objectives in mind.
1. To study the factors which influence the purchase of Hero two-wheelers?
2. To know the customer level of awareness of Hero two-wheelers.

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3. To know the various factors, which influence customers in purchasing, they‘re two wheelers?
4. To find the after sales service offered by Hero MotoCorp Ltd.
5. To know the customer level of satisfaction of Hero two-wheelers with respect to Hero
MotoCorp Ltd.
6. To find the profile of Hero MotoCorp Ltd two-wheeler customers.
7. To understand two wheeler sector in India.
8. How the split with Honda has affected Hero motors.

SCOPE OF THE STUDY
 This study helps the organizations to increase their service and product quality and
in turn increase the market share, top and bottom line of the company.
LIMITATIONS
I have observed the following limitations in the course of my study.
1. The areas which were selected were limited only to Bangalore i.e., the findings are regional
and do not represent the state or country.
2. Time constraints hampered the study.
3. Since the study involved in gathering information was from upper to higher-middle class
people, interaction with them became difficult.
4. There may be respondent‘s bias.
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5. Even though utmost care has been taken in conducting the survey, the findings may
sometimes differ from the population.
6. The study is conducted of academic nature
7. The split happened 1 year before, the study not giving the long run result of Hero Motors
Bikes

NEED FOR THE STUDY

Marketing starts with identifying the needs of customers and ends in satisfying those
wants. The goal of marketing is to attract new customers by promising superior value and to
keep current customers by delivering satisfaction based on their preferences retaining them.
Without customer, no market exists. As the customers are regarded as the superiors
in today‘s market, the level of satisfaction and their preferences should be keenly studied.
The two-wheeler industry has been expanding rapidly.

Gone are the days when

possessing a two-wheeler was seen as a luxury. Now days, it is viewed as a mere necessity.
Prior, sale of two-wheelers was mainly confined to urban areas but lately in rural areas
the bicycles are being replaced by power driven two-wheelers such as scooters, motorcycles.
Not only this, this industry has also customers ranging from all demographic segments.
It has been common sights that even school going children are driving two-wheelers. The
women customers are also increasing due to increase in women literacy and employment.
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Getting a new customer is difficult, than retaining a current customer is a more difficult
one and not only that it is estimated that the cost of attracting a new customer is five times the
cost of retaining current customer. It requires a great deal of effort to induce satisfied customer
to switch away from their current preference. Thus, customer satisfaction is been given top
priority in today‘s competitive world.
Therefore, keeping the above stated objective in mind, this study was conducted to ascertain
the customer‘s satisfaction towards Hero two-wheelers in Hero MotoCorp Ltd. In view of this, a
detailed study of customer preferences, levels of satisfaction and their complaints and
suggestions was undertaken.

METHODOLOGY OF THE STUDY
The information required for this study obtained was basically through two sources.
Primary Data:
Primary Data has been gathered by a survey through a structured questionnaire.
The Data has been collected from 100 customers, through questionnaires, by using
simple random sampling. In addition interaction with the staff of Hero MotoCorp Ltd has also
given some information.
Secondary Data:
Secondary Data comprises of information obtained from annual reports, brochures,
manuals websites etc.
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3. INDUSTRY PROFILE
The Indian two-wheeler contributes the largest volume amongst all the segments in automobile
industry. Though the segment can be broadly categorized into 3 sub-segments viz. scooters,
motorcycles and mopeds; some categories introduced in the market are a combination of two
or more segments e.g. scooters and step-thru. The market primarily comprises five players in
the two-wheelers segment with the most of the companies having foreign collaboration with
well-known Japanese firms earlier. But most of the companies are now planning 100%
subsidiaries in India. and growth anticipated is higher than the 16 percent achieved in the past
10 years
The automobiles sector is divided into four segments-two wheelers(mopeds, scooters,
motorcycles, electric two-wheelers), passenger vehicles (passenger cars, utility vehicles, multipurpose vehicles), commercial vehicles (light and medium-heavy vehicles), and three wheelers
(passenger carriers and good carriers).
The industry is one of the key drivers of economic growth of the nation. Since the globalization
of the sector in 1991 and the subsequent opening up of 100 percent FDI through automatic
route, Indian automobile sector has come a long way. Today, almost every global auto major
has set up facilities in the country.
The world standings for the Indian automobile sector, as per the Confederation of Indian
Industry, are as follows:

 Largest three-wheeler market
 Second largest tow-wheeler market
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 Tenth largest passenger car market
 Fourth largest tractor market
 Fifth largest commercial vehicle market
 Fifth largest bus and truck segment
The sector has shown a sluggish growth of 12 percent in 2012. The trend is likely to stay with a 10
percent growth outlined for 2013 citing high ownership costs (fuel costs, cost of registration, excise duty,
road tax) and slow rural income growth. Solid but cautious growth is expected over the next few years.
However, from a long-term perspective, rising incomes, improved affordability and untapped markets
present promising opportunities for automobile manufactures in India. According to Macquarie equities
research, sale of passenger vehicles is expected to double in the next four years

Two Wheeler & its role in Indian Context:
As the cities grow & suburbs expand, transportation needs becoming more & more
acute, with mounting pressure on its public transportation for which two wheelers are ideal.
The two-wheeler Industry today has a significant role in the Indian economy, with an
annual turnover of Rs. 9000 crores and compounded average growth of 10%. In recent years,
it is of the few industrial sectors in the growth phase today considers personal transportation as
one of the basic needs.
The two-wheeler industry basically comprises mopeds, scooters, scooters and
motorcycles. Mopeds are basic entry-level products aimed at lower/middle income groups,
offering company. This category dominated by TVS SUZUKI, which has a market share of
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50% today. The other major players in this segment include KINETIC ENGG., HERO MOTORS
and BAJAJ AUTO.
Scooters, which found largest segment in the industry (37 percent) is dominated by
BAJAJ AUTO. It is however facing stiff competition from LML, which offers better style and
technology to the Indian customers. However, dominance of this category has been declining
because of shift in the customer preferences.
Major part of the growth in the two-wheeler industry has come from motorcycle
especially, the Indo-Japanese 100cc motorcycles, which are considered, fuel efficient, reliable
and suited for rough roads.
Scooters also growing at a fast phase and are being increasingly perceived as a better
option providing convenience and motor style, by urban customers. In this category, TVS
Scooty holds a dominant market share.
With sales of over three million vehicles, India is the second largest two-wheeler
market in the world. Vehicle has become a necessity for day-to-day busy life, with the
accelerated industrial and business activity in a liberalized environment. However, given the
limited purchasing power and to high cost of cars, majority of the middle class vehicle users
prefer two wheelers.
With sales of over million vehicles, India is the second largest two-wheelers market in
the world. China is the market leader with around 51 percent of the Asia Market, India,

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Thailand; Indonesia & Taiwan are the other key markets for two-wheelers with market share of
19 percent, 10 percent, 9 percent and 5 percent respectively.
In the last four to five years, the two-wheeler market has witnessed a market shift
towards motorcycles at the expense of scooters. In the rural areas, consumers have come to
prefer sturdier bikes to withstand the bad road conditions. In the process the share of
motorcycle segment has grown from 48% to 58%, the share of scooters declined drastically
from 33% to 25%, while that of mopeds declined by 2% from 19% to 17% during the year 200001. The Euro emission norms effective from April 2000 led to the existing players in the twostroke segment to install catalytic converters. 4-stroke motorcycles are now replacing all the
new models. Excise duty on motorcycles has been reduced from 32% to 24%, resulting in
price reduction, which has aided in propelling the demand for motorcycles. Fierce competition
has also forced players to cut prices of certain models.
Competition has intensified over the last couple of years altering the dynamics in the
motorcycle segment with various companies planning to cash in on this spurt in demand by
calling off their JVs like Suzuki Motors planning to break off with TVS. Recently, Honda
Corporation of Japan announced its intentions to set up a 100% subsidiary to manufacture
scooters and motorcycles. Other players in the two-wheeler industry include Bajaj Auto Ltd.,
Kinetic Motor Co.Ltd. LML and Escorts Yamaha. Low interest regime has helped in reducing
cost of loans, which will help in boosting sales of 2-wheelers, since 80% of the two-wheelers
are credit –stimulated.

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The two-wheeler industry is passing through a critical but interesting phase. For many
years, it was growing continuously but the turning point came in 1996=97 when it started
slowing down. The impact was really (MI) felt in the next year when the overall growth was
hardly two percent. This was also possible only because the motorcycle segment showed a
healthy growth of 15 percent. The scooter segment went down by 3 percent and mopeds by 6
percent.
Another highlight is that the motorcycle sales have surpassed the scooter sales for the
first time in 1998-99. Until then, motorcycle sales were always trailing behind.
The net result is that motorcycles now account for 41 percent of the two-wheeler
market, while scooters account for 36 percent. Mopeds have been able to hold their own at
about 21 percent.

GROWTH OF MOTORCYCLES
It is therefore not surprising that every major player is trying to get into the Motorcycle
market to have a piece of the cake.
Hero MotoCorp Ltd is indisputable the leader with 38 percent share followed by Bajaj
with 27 percent (includes M-80), TVS at 19 percent and Escorts at 13 percent. Now LML and
Kinetic have announced their plans to manufacture motorcycles, which are likely to come in the
market by next year. The battle is expected to be fierce but the consumer will be the greater
beneficiary.
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The growth in motorcycles is slowly losing its hold. It is considered a family vehicle but
perhaps there is competition from the second hand car markets where prices have fallen down
rapidly. A1992 Maruti 800 is now available for just 70,000.
The scooter manufactures have to watch this phenomenon and bring our many new
product variants in the right price slots to sustain their shares in the market. The moped market
has been steady with an average growth of 3 percent. It is dominated by TVS which holds 48
percent market share followed by Kinetic and Majestic Auto at 23 percent and 18 percent
respectively.
In each segment, there is a wide gap between the first two contenders, which makes
their products positioning and marketing strategies most interesting. The two wheelers market
seems to be maturing. There are the usual their conventional segment of scooters, mopeds
and motorcycles. Two new segments are being created.

NEW SEGMENTS
A Step is through segment like Kinetic K4-100, Honda Street, Bajaj M-80, which is
quite close to the motorcycle segment. The other segment is scooterettes or mini scooters in
which vehicles such as Kinetic SX/Style, TVS Scooty, Hero Winner, Bajaaj Sunny/Sprite/Safire
and LML trendy can be considered. These are vehicles under 75 cc and largely targeted at the
youth market such as college students, young boys and girls and new couples. They get the
advantage of lower excise duty at 16 percent as compared to 24 percent applicable over 75 cc.
The trend is towards push button start vehicles.
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Among the majors in the two-wheeler industry, first quarter figure for the current year of some
players has been encouraging. The company sold 313,303 units last month as compared to
325,360 units in the same month last year. With this, BAL has recorded as 87 percent growth in
the motorcycle segment in the first quarter with sales of 130,577 units (93,631 units in the
corresponding period last year) BAL estimates market share of the first quarter-Geared
scooters 75.9%, unguarded scooters- 16.5%, Step-thrus-72.3% and motorcycle-20.5%.
In the scooters segment, sales of Bajaj Sunny and Bajaj Spirit increased by 170
percent to 7,876 units. First quarter sales registered an impressive 78 percent growth with
sales of 19,562 (10,995 units). The overall sales grew by 9.3 percent in the quarter when the
company sold 3.24 lakh vehicles.
BAL however reported a decline in sales of scooters by 15.6 percent in the first
quarter. The company hopes to increase the share of motorcycle in its product basket from 18
percent last year to 30 percent by 2003-04.
Hero MotoCorp Ltd enjoys tremendous brand equity in the motorcycle segment.
Kinetic Motors, another important player, managed to grow in 1999-2000, when the
scooters segments a whole slipped by around 5 percent. TVS Suzuki, a motor two-wheeler
market, has reported a growth of 13 percent in the first quarter period and sold 2.19 lakh units.
Sales of motorcycles and scooters were up by 18 percent and that of mopeds by 8 percent
over the same period last year.

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The current year therefore promises to be a testing time for the two-wheeler industry.
Industry pundits feel that an overall growth rate of 5 percent should be possible as against 9
percent projected earlier. The sales volume therefore is expected to be around 3.8 million in
2000-2001.
DRAMATIC CHANGES:
HeroMotoCorp is now world‘s largest manufacturer of two-wheelers. The company has

benefited from the demand shift to motorcycles, as it focuses solely on this product segment
(although has a product called Pleasure in Scooter segment). With fuel efficiency and riding
comfort as the main selling points, HMC has been able to address a wide market and post
robust sales growth even after its separation from the Japanese major Honda.
The coming years will see increasing competition due to the parity in products
and price. The only differentiators will be technology, quality, product range and service.
Imaginative marketing will emphasize relationship building, customer satisfaction and
relationship. All is exploring new techniques such as direct marketing and institutional sales.
Some of them are taking the vehicle actually to the customer‘s doorstep. Now the customer is
the king.
HISTORICAL DEVELOPMENT OF TWO WHEELER INDUSTRY
India is the second largest manufacturer and producer of two-wheelers in the world. It
stands next to Japan and China in terms of the number of two-wheelers produced and
domestic sales respectively. This distinction was achieved due to variety of reasons as if

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respective policy followed by the Government of India towards the passenger car industry,
rising demand for personal transport, inefficiency in the public transportation system etc.,
In Indian two-wheeler, industry made a small beginning in the early 50s when
Automobile Products of India (API) started manufacturing scooters in the country. Until 1958,
API and Enfield were the sole producers.
In 1948, Bajaj Auto began trading in imported Vespa scooters and three wheelers.
Finally, in 1980, it setup a shop to manufacture them in technical collaboration with Piaggio of
Italy. The agreement expired in 1971.
In the initial stages, API it was later overtaken by Bajaj Auto dominating the scooter
segment. Although various Government and Private enterprises entered the fray for scooters,
the only new player that has lasted until today is LML.
Under the regulated regime, foreign companies were not allowed to operate in India. It
was a complete seller market with the waiting period for getting a scooter from Bajaj Auto being
as high as 12 years.
The motorcycles segment was no different, with only three manufacturers via Enfield,
Ideal Jawa and Escorts. While Enfield bullet was a four-stroke bike, Jawa and the Rajdoot were
two-stroke bikes. Enfield 350cc bikes and Escorts 175cc bike initially dominated the motorcycle
segment.
The two-wheeler market was opened to foreign competition in the mid 80‘s. And
then the market leaders-E5corts and Enfield- were caught unaware by the onslaught of the 100
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cc bikes of the four IndoJapanese joint ventures. With the availability of fuel-efficiency low
power bikes, demand swelled resulting in Hero Honda — the only producer of four-stroke bikes
(100cc category), gaining a top slot.
The first Japanese motorcycles were introduced in the early eighties. TYS Suzuki and
Hero Honda brought in the first two-stroke and four-stroke engine motorcycles respectively.
These two players initially started with assembly of CKD kits, and later on progressed to
indigenous manufacturing. In the 90‘s the major growth for motorcycle segment was brought in
by Japanese motorcycles, which grew at a rate Of nearly 25% CAGR in the last five years.
The industry had a smooth ride in the 50‘s, 60‘s and70‘s when the government prohibited new
entries and strictly controlled capacity expansion. The industry saw a sudden growth in the
80‘s. The industry witnessed a steady growth of 14% leading to a peak volume of 1.9mm
vehicles in 1990.
The entry of Kinetic Honda in mid-eighties with a variometric scooter helped in
providing ease of use to the scooter owners. This helped in inducing youngsters and working
women towards buying scooters, who were earlier inclined towards moped purchases. In line
with this, the scooter segment has consistently lost its part of the market share in the
two~whee1er market.
In 1990, the entire automobile industry saw a drastic fall in demand. This resulted in a
decline of 15% in 1991 and 8% in1992, resulting in the production loss of 0.4mn vehicles.
Barring Hero Honda, all the major producers suffered from recession in FY93 and FY94. Hero
Honda showed a marginal decline in 1992.
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The reasons for recession in the sector were the incessant rise in fuel price, high input
costs and reduced purchasing power due to significant rise in general price level and credit
crunch in consumer financing. Factors as if increased production in 1992, due to new entrants
coupled with the recession in the industry resulted in either company reporting losses or fail in
profits.India is one of the very few countries manufacturing three wheelers in the world. It is the
world‘s largest manufacturer and seller of three wheelers. Bajaj Auto commands a monopoly in
the domestic market with a market share of above 80%; Bajaj Tempo, Greaves Ltd and
Scooters in India share the rest.
The total number of registered two-wheelers and three-wheelers on road in India, as
on March 1998 was 27.9nm and 1 .7nin respectively. The two-wheeler population has almost
doubled in 1996 from a base of 12.6mn in 1990.
PENETRATION OF TWO-WHEELERS:
On a base of around 28mn vehicles on Indian roads and around 175mn households,
there were only 160 motorized two-wheelers per thousand households in FY98. This compares
poorly with countries like Thailand where it is around 600 per thousand households. Also with a
household size of 5.5 persons and more than one wage earner in about 60% of the
households, the potential for a second vehicle demand is also good.
The number of households in the low-income group has fallen since FY86 and has
been more pronounced in the post-reform period. On the other hand, the number of
households in the middle, upper middle and high-income groups that form the consumer base
for twowheelers, have increased. Their share of the total number of households has increased
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from 10.6% in FY88 to 20.5% inFY96. This rising income profile however, has, been more
pronounced in the urban areas as average annual growth in industry surpassed that of
agriculture in the period FY93 to FY96.

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4. COMPANY PROFILE
Hero MotoCorp Ltd. (Formerly Hero Honda Motors Ltd.) is the world's largest manufacturer of
two - wheelers, based in India.
In 2001, the company achieved the coveted position of being the largest two-wheeler
manufacturing company in India and also, the 'World No.1' two-wheeler company in terms of
unit volume sales in a calendar year. Hero MotoCorp Ltd. continues to maintain this position till
date.
HeroMotoCorp is now world‘s largest manufacturer of two-wheelers. The company has
benefited from the demand shift to motorcycles, as it focuses solely on this product segment
(although has a product called Pleasure in Scooter segment). With fuel efficiency and riding
comfort as the main selling points, HMC has been able to address a wide market and post
robust sales growth even after its separation from the Japanese major Honda.

VISION
The story began with a simple vision – the vision of a mobile and an empowered India,
powered by its bikes. Hero MotoCorp Ltd., company‘s new identity, reflects its commitment
towards providing world class mobility solutions with renewed focus on expanding company‘s
footprint in the global arena.

MISSION
Hero MotoCorp's mission is to become a global enterprise fulfilling its customers' needs and
aspirations for mobility, setting benchmarks in technology, styling and quality so that it converts
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its customers into its brand advocates. The company will provide an engaging environment for
its people to perform to their true potential. It will continue its focus on value creation and
enduring relationships with its partners.
STRATEGY
Hero MotoCorp's key strategies are to build a robust product portfolio across categories,
explore growth opportunities globally, continuously improve its operational efficiency,
aggressively expand its reach to customers, continue to invest in brand building activities and
ensure customer and shareholder delight.
MANUFACTURING
Hero MotoCorp two wheelers are manufactured across three globally benchmarked
manufacturing facilities. Two of these are based at Gurgaon and Dharuhera which are located
in the state of Haryana in northern India. The third and the latest manufacturing plant are based
at Haridwar, in the hill state of Uttrakhand.

TECHNOLOGY
In the 1980's the Company pioneered the introduction of fuel-efficient, environment friendly
four-stroke motorcycles in the country. It became the first company to launch the Fuel Injection
(FI) technology in Indian motorcycles, with the launch of the Glamour FI in June 2006.
Its plants use world class equipment and processes and have become a benchmark in
leanness and productivity.
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Hero MotoCorp, in its endeavor to remain a pioneer in technology, will continue to innovate and
develop cutting edge products and processes
DISTRIBUTION
The Company's growth in the two wheeler market in India is the result of an intrinsic ability to
increase reach in new geographies and growth markets. Hero MotoCorp's extensive sales and
service network now spans over to 5000 customer touch points. These comprise a mix of
authorized dealerships, service & spare parts outlets and dealer-appointed outlets across the
country.

Supply chain management
As the Company prepares to produce a wider range of products, efforts are being taken to align
the supply chain and prime up its supplier base. During the year, the Company kick-started the
process of migrating its existing brands to the new brand. The exercise is expected to be
completed during 2012-13.
During the year, the Company also commenced the process of working with its vendors to
develop new parts. The Company‘s Supply Chain Management function is built on three
planks:
Cost
Quality
Sustainability

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Tracking inventory cost effectively and efficiently is known to be a key source of competitive
advantage in the automobile industry. Hence, it comes as no surprise that cost leadership is
the Company‘s prime focus area. Continual pressure on margins forced the Company and its
supply chain partners to find innovative and alternate ways to combat inflation. Considerable
attention was given to managing component inventory in the system, with double-digit growth in
inventory turnover. To align HR processes with the supply chain, top two HR consulting firms in
India are working with supply chain partners. The exercise is aimed at improving robustness of
people processes and resulting in a direct impact on quality, cost, productivity, delivery and
reliability. The move will enable supply chain partners move to the next orbit of operational
excellence. The Company initiated more than 30 quality improvement projects with supply
chain partners to provide better quality products to customers.
BRAND
The new Hero is rising and is poised to shine on the global arena. Company's new identity
"Hero MotoCorp Ltd." is truly reflective of its vision to strengthen focus on mobility and
technology and creating global footprint. Building and promoting new brand identity will be
central to all its initiatives, utilizing every opportunity and leveraging its strong presence across
sports, entertainment and ground- level activation.

Directors
Founder Director and Chairman :

Dr. Brijmohan Lall Munjal

Managing Director and CEO

Mr. Pawan Munjal .

:

Page 26


Board of Directors
Name of the person

Nature of the Office

Mr. Sunil Kant Munjal

Non Executive Director

Mr. Suman Kant Munjal

Director

Mr. Paul Edgerley

Non Executive Director

Mr. Pradeep Dinodia

Director

Gen. (Retd.) V. P. Malik

Director

Mr. Analjit Singh

Director

Dr. Pritam Singh

Director

Mr. M. Damodaran

Director

Mr. Ravinath

Director

Dr. Anand C.Burman

Director

Dr. Brijmohan Lall Munjal
Mr. Munjal is the founder Director and Chairman of the Company and the
$3.2 billion Hero Group. He is the Past President of Confederation of Indian Industry (CII),
Society of Indian Automobile Manufacturers (SIAM) and was a Member of the Board of the
Country's Central Bank (Reserve Bank of India). In recognition of his contribution to
industry, Mr. Munjal was conferred the Padma Bhushan Award by the Union Government

Page 27


Corporate Governance
At Hero MotoCorp, it is the firm‘s belief that the essence of Corporate Governance lies in the
phrase ''Your Company''. It is ''Your'' Company because it belongs to you - the shareholders.
The Chairman and Directors are ''Your'' fiduciaries and trustees. Their objective is to take the
business forward in such a way that it maximizes ''Your'' long-term value.
This Company is committed to benchmarking itself with global standards for providing good
Corporate Governance. It has put in place an effective Corporate Governance System which
ensures that the provisions of Clause 49 of the Listing Agreement are duly complied with.
The Board has also evolved and adopted a Code of Conduct based on the principles of Good
Corporate Governance and best management practices being followed globally.
Headquarter and Branches
Corporate & Registered Office
Hero MotoCorp Ltd.
34, Community Centre, Basant Lok, Vasant Vihar, New Delhi - 110057, India.
Tel: +91-11-26142451, 26144121
Fax: +91-11-26143321, 26143198

Page 28


Zonal Offices
East Zone
Hero MotoCorp Ltd
3F, Neelamber Building, 28B, Shakespeare Sarani, Third Floor, Kolkata - 700017, India.
Tel: +91-33-22810926 22810927, 22808922, 22811185
Fax: +91-33-22808923
Email: kolkata@heromotocorp.com

West Zone
Hero MotoCorp Ltd.
15-A, Bhale Estate, Rear Wing, Third Floor, Pune-Mumbai Road,
Wakadewali, Pune - 411 003, India.
Tel: +91-20-25511577, 25512161, 56012990-91
Fax: +91-20-25511266
Email: pune@heromotocorp.com

North Zone
Hero MotoCorp Ltd.
F-126, Katwaria Sarai, Opp. Qutab Institutional Area,
New Delhi -110016, India.
Tel: +91-11-26533981-2, 47619300
Fax: +91-11-26533983
Page 29


Email: delhi@heromotocorp.com
South Zone
Hero MotoCorp Ltd.
No - 294, 2nd Floor, 6th Main, Off 100 ft Road, HAL 2nd Stage,
Indira Nagar, Bangalore – 560038, India.
Tel: +91-80-25550430, 25584436, 25582436, 25321139
Fax: +91-80-25594036
Email: bangalore@heromotocorp.com

GRADING POSITIVES
Market leadership, strong brand equity, professional management, high operating efficiency
and established scale economies. Strong financial profile characterized by healthy margins,
high profitability and cash generation. Potential upsides to our estimates: (1) HMCL sustains its
current market share, leveraging its brand equity, product performance and distribution
strengths; (2) industry growth exceeds our estimates over the medium term despite existing
concerns on macro-economic scenario; (3) HMCL betters the margins estimated by us via
sustained business growth and increases in operating efficiency even in the face of competitive
and cost pressures.

Page 30


GRADING SENSITIVITIES
Key sensitivities to our estimates include:
(1) Inflation in input costs not being neutralized by price increases because of competitive
pressures;
(2) High concentration on Executive segment;
(3) Intensifying competition from global players;
(4) Ability to develop in-house technical capability or form alternate technical tie-ups with
external institutions.

Company History - Hero Moto Corp
1983
-

Joint Collaboration Agreement with Honda Motor Co. Ltd. Japan signed

-

Shareholders Agreement signed

1984
-

Hero Honda Motors Ltd. Incorporated

1985
-

First motorcycle "CD 100" rolled out

1987
-

100,000th motorcycle produced1989New motorcycle model - "Sleek"
introduced

Page 31


1991
-

New motorcycle model - "CD 100 SS" introduced

-

500,000th motorcycle produced

1992
-

Raman Munjal Vidya Mandir inaugurated - A School in the memory of founder
Managing Director, Mr. Raman Kant Munjal

1994
-

New motorcycle model - "Splendor" introduced

-

1,000,000th motorcycle produced

1997
-

New motorcycle model - "Street" introduced

-

Hero Honda's 2nd manufacturing plant at Gurgaon inaugurated

1998
-


1999
-

New motorcycle model - "CBZ" introduced

-

Environment Management System of Dharuhera Plant certified with ISO14001 by DNV Holland

-

Raman Munjal Memorial Hospital inaugurated - A Hospital in the memory of
founder Managing Director, Mr. Raman Kant Munjal

2000
-


Page 32


-

Environment Management System of Gurgaon Plant certified ISO-14001 by
DNV Holland

-

Splendor declared 'World No. 1' - largest selling single two-wheeler model

-

"Hero Honda Passport Programme" - CRM Programme launched

2001
-

New motorcycle model - "Passion" introduced

-

One million production in one single year

-

New motorcycle model - "Joy" introduced

-


2002
-

New motorcycle model - "Dawn" introduced

-

New motorcycle model - "Ambition" introduced

-

Appointed Virender Sehwag, Mohammad Kaif, Yuvraj Singh, Harbhajan Singh
and Zaheer Khan as Brand Ambassadors

2003
-

Becomes the first Indian Company to cross the cumulative 7 million sales mark

-

Splendor has emerged as the World's largest selling model for the third
calendar year in a row (2000, 2001, 2002)

-

New motorcycle model - "CD Dawn" introduced

-

New motorcycle model - "Splendor +" introduced

-

New motorcycle model - "Passion Plus" introduced

-

New motorcycle model - "Karizma" introduced

Page 33


2004
-

New motorcycle model - "Ambition 135" introduced

-

Hero Honda became the World No. 1 Company for the third consecutive year.

-

Crossed sales of over 2 million units in a single year, a global record.

-

Splendor - World's largest selling motorcycle crossed the 5 million mark

-

New motorcycle model - "CBZ*" introduced

-

Joint Technical Agreement renewed

-

Total sales crossed a record of 10 million motorcycles

2005
-

Hero Honda is the World No. 1 for the 4th year in a row

-

New motorcycle model - "Super Splendor" introduced

-

New motorcycle model - "CD Deluxe" introduced

-

New motorcycle model - "Glamour" introduced

-

New motorcycle model - "Achiever" introduced

-

First Scooter model from Hero Honda - "Pleasure" introduced

2006
-


-

15 million production milestone achieved

2007
-


-

New 'Splendor NXG' launched

-

New 'CD Deluxe' launched

-

New 'Passion Plus' launched
Page 34


-

New motorcycle model 'Hunk' launched

-


2008
-

Hero Honda Haridwar Plant inauguration

-

New 'Pleasure' launched

-

Splendor NXG lauched with power start feature

-

New motorcycle model 'Passion Pro' launched

-

New 'CBZ Xtreme' launched

-


-

CD Deluxe lauched with power start feature

-

New 'Glamour' launched

-

New 'Glamour Fi' launched

2009
-

Hero Honda GoodLife Program launched Hunk' (Limited Edition) launched

-

Splendor completed 11 million production landmark

-

New motorcycle model 'Karizma - ZMR' launched

-

Silver jubilee celebrations

2010
-

New model Splendor Pro launched

-

Launch of new Super Splendor and New Hunk

2011
-

New licensing arrangement signed between Hero and Honda (Hero
Honda is renamed as Hero)
Page 35


-

Launch of new refreshed versions of Glamour, Glamour Fi, CBZ Xtreme,
Karizma

-

Crosses the landmark figure of 5 million cumulative sales in a single year

2012

-

45% market share in the domestic two-wheeler market

-

56% market share in the domestic motorcycle market

-

Declared a dividend of 2,250% in 2011-12, i.e. 45 per equity share of the face
value of 2 per share

Awards & Recognitions on 2011
Two-wheeler Manufacturer of the Year award by Bike India magazine. Adjudged the
"Bike Manufacturer of the Year" at the Economic Times ZigWheels Car and Bike
Awards.
CNBC Awaaz - Storyboard special commendation for "Effective rebranding of a new
corporate entity" by CNBC Awaaz Consumer Awards
"Most Recommended Two-Wheeler Brand of the Year" award by CNBC Awaaz
Consumer Awards
Colloquy Loyalty Awards "Innovation in Loyalty Marketing International 2011" for Hero
Good Life

Page 36


"Best Activity Generating Short or Long-Term Brand Loyalty" by the Promotion
Marketing Award of Asia Order of Merit for Hero Good Life
Ranked No 1 brand in the Auto (Two-Wheelers) category in the Brand Equity "Most
Trusted Brand" 2011 serve

Sales figures
OEM

F12

F11

Growth (%)

1

Hero Moto corp

6235205

5402444

15.41

2

Bajaj

3834405

3387043

13.21

3

TVS

2158375

2006808

7.55

4

Honda (scooters)

1240771

907832

36.67

Honda (Motorcycle)

866457

748895

15.70

Hero – HMSI

2107228

1656727

27.19

5

Yamaha

484891

373100

29.96

6

Suzuki

340893

282156

20.82

7

Mahindra

134750

163935

-17.80

Source: - www.motorbeam.com

Page 37


•

Profile of target customer

Hero MotoCorp basically targets the every each and segments of the market. So there are
some products like splendor, CD- dawn (rs40000-50000) they made for lower segment of the
market and glamour, passion, CBZ, karizma (rs above 50000) for the upper segment of the
market. And now they are trying to target the young people of the market.
India‘s Hero MotoCorp, the world‘s largest producer of motorcycles and scooters, has
announced its intention to expand globally, with plans to sell vehicles on three continents and
nearly double its unit sales within five years. The company, whose family shareholders bought
out its former partner Honda Motor this year, said it would invest about $1bn to expand
internationally in south-east Asia, Africa, and Central and Latin America.

•

Customer Relationship Activity

For making a better relationship with customer they always use genuine parts in their product.
And after selling they have the services and maintenances. Their constant endeavor is to
support the company's mandate of providing highest level of customer satisfaction by taking
good care of customer‘s two-wheeler service and maintenance through their vast network of
more than 2100 committed dealers and service outlets spread across the country.
Apart from that hero motocorp focused on cleanliness and other aesthetics of the service
stations and add such air conditioned waiting area, internet surfing, coffee shops etc to
enhance the in house experience of the customers at those ―customer touch point‖. To ensure
Page 38


that millions of customers in the rural area are not left waiting for adequate service as it is
impossible for the company to introduce service station at every nook and corner of the
country, mobile service stations are regularly arranged with prior intimation to public about the
rout that the mobile workshop would take when passing through that region so that customers
can come and get their two wheelers serviced. All these activities are aimed to increase the
customer loyalty and thus retaining customers.

Good life: Customer Loyalty Program
Good Life is a Customer Relationship Program introduced a decade ago, which Endeavour‘s to
enhance customer satisfaction and initiate increased levels of member engagement.
The main objective of this Program is to make our customers our Brand Ambassadors to
generate referral sales and boost service visits.
The GoodLife Program has enabled the Company build a consolidated base of 10 million plus
loyal customers; in the process, a new distribution platform has emerged. GoodLife now
contributes a huge 14% to the Company‘s overall sales (purely through referrals), in addition to
incremental sales. GoodLife has emerged as the largest Customer Relationship Program in
India, witnessing additions of 0.38 million members each month. During the year, the
Program‘s member base shot up 16%, with new 4.51 million transactions being undertaken.
Besides aiming to increase the number of customers and volume of transactions, the Program
seeks to enhance revenue opportunities for dealers as well. Different levels of engagement
have been in-built into the Program with the aim of increasing its people engagement initiatives.
Some of these are: transaction-based rewards, exclusive event invites, personal accidental
Page 39


insurance, service continuity bonus, transaction benefits on special occasions (birthdays,
anniversaries), quarterly newsletters and interaction through a program website.
The Program began with a member transaction booklet, a replica of the Passport Booklet,
which helps in engaging with customers. However, the Program has been e-enabled now to
improve its geographical reach and efficiency level. It runs on the backbone of a robust and
engaging front-end and a sound, solid and technical back-end. The Program includes
customized technology, combining a mix of Magnetic Swipe/Bar Code. Personalized
Membership Cards are shared with GoodLife members, which are easy to carry, transact and
earn/redeem rewards. Online member profiling and real-time customer feedback module (via
questionnaires) are some more salient features of the Program. During the year, GoodLife has
been the recipient of several accolades and awards on national and international platforms.
Some of these were:
‗Order of Merit‘ in PMAA awards 2011 under ‗Best Activity Generating Short or Long
Term Brand Loyalty‘ category
Colloquy Award under Innovation in Loyalty Marketing (International) category
Qualified as ECHO Finalist (5th place) in 2011 DMA International ECHO™ Awards
competition Loyalty Award under Auto Sector
OPERATION RAMP-UP
With demand for bikes recording a stupendous growth of 15% during the year under
review, the Company‘s capacities were severely strained. This prompted it to augment
its capacity at its three plants – up from 5.4 million units to 6.35 million – during the
year. This was made possible through a number of de-bottlenecking measures. For
Page 40


example, the Company‘s plants were made leaner by outsourcing non-critical
processes and operations.
Besides this, a number of structural changes and alterations were made in its
manufacturing strategy to effectively implement its Sales Plan for 2012-13.
Major replacements were also executed in the paint and assembly shop, ensuring little
or no shutdown along the assembly line. Apart from the above measures, several
innovative technologies were inculcated to reduce operational costs. Some examples
of these are:
A breakthrough technology for gear rolling was implemented for massproduction
Fine blanking, an alternate process of hobbling, was introduced for sprocket
components
Advanced cam grinding was introduced to increase productivity and control
costs
The Company‘s oldest plant at Dharuhera was in the limelight for two specific reasons:
Wage negotiations were concluded
Plant won TPM Excellence Award
The Company continues to set new industry benchmarks in the areas of energy
conservation and sustainability. Vapour absorption machines and heat recovery units
were installed during the year to utilize waste heat from Gas DGs for air-conditioning
and pre-heating of hot water generation. Other green initiatives included projects on
waste water management, LED lighting and solar power. These cost leadership and

Page 41


green projects yielded considerable savings to the Company within a short period of
time.

PORTFOLIO OF PRODUCTS
Hero MotoCorp offers wide range of two wheeler products that include motorcycles and
scooters, and has set the industry standards across all the market segments.

100cc
Bike category
SPLENDOR PLUS
SPLENDOR NXG
SPLENDOR PRO
PASSION PRO
PASSION XPRO
MAESTRO
PLEASURE
HF DAWN
HF DELUXE

125cc

Page 42


Bike category
GLAMOUR
SUPER SPLENDOR
IGNITOR
Glamour PGM FI

150cc
Bike category
ACHIEVER
KARIZMA
KARIZMA ZMR
IMPULSE
HUNK
XTREME

Page 43


Termination of Honda joint venture
In December 2010, the board of directors of the Hero Honda Group has
decided to terminate the joint venture between Hero Group of India and Honda of Japan in a
phased manner. The Hero Group would buy out the 26% stake of the Honda in JV Hero
Honda. Under the joint venture Hero Group could not export to international markets (except
Sri Lanka) and the termination would mean that Hero Group can now export. Since the
beginning, the Hero Group relied on their Japanese partner Honda for the technology in their
bikes. So there are concerns that the Hero Group might not be able to sustain the performance
of the Joint Venture alone.
The Japanese auto major will exit the joint venture through a series
of off market transactions by giving the Munjal family—that held a 26% stake in the company—
an additional 26%. Honda, which also has an independent fully owned two wheeler
subsidiary—Honda Motorcycle and Scooter India (HMSI)—will exit Hero Honda at a discount
and get over $1 billion for its stake. The discount will be between 30% and 50% to the current
value of Honda's stake as per the price of the stock after the market closed on Wednesday.
The rising differences between the two partners gradually emerged as
an irritant. Differences had been brewing for a few years before the split over a variety of
issues, ranging from Honda's reluctance to fully and freely share technology with Hero (despite
a 10-year technology tie-up that expires in 2014) as well as Indian partner's uneasiness over
high royalty payouts to the Japanese company. Another major irritant for Honda was the refusal

Page 44


of Hero Honda (mainly managed by the Munjal family) to merge the company's spare parts
business with Honda's new fully owned subsidiary Honda Motorcycle and Scooter
India (HMSI).
As per the arrangement, it will be a two-leg deal. In the first part,
the Munjal family, led by Brijmohan Lal Munjal group, will form an overseas-incorporated
special purpose vehicle (SPV) to buy out Honda's entire stake, which will be backed by bridge
loans. This SPV would eventually be thrown open for private equity participation and those in
the fray include Warburg Pincus, Kohlberg Kravis Roberts (KKR), TPG, Bain Capital,
and Carlyle Group.
Honda will continue to provide technology to Hero Honda motorbikes until 2014 for existing as
well as future models.

Page 45


4. DATA ANALYSIS AND INTEPRETATION
Table- 4.1 Showing type of Hero two wheeler models owned

Num

Name of Hero two
wheeler

No. of
respondents

1

SPLENDOR PLUS

25

2

SPLENDOR PRO

10

3

PASSION PRO

30

4

HUNK

2

5

GLAMOUR

3

6

KARIZMA ZMR

2

7

KARIZMA

1

8

MAESTRO

3

9

SUPER SPLENDOR

2

10

SPLENDOR NXG

5

11

PLEASURE

6

12

HF DAWN

1

13

PASSION XPRO

9

14

IMPULSE

1

Total

100

Inference:- From the above table it is inferred that, 30% of respondents held Passion Pro and
25% of respondents held Splendor Plus, Splendor Pro 10%, and Passion Xpro 9%. The
remaining two wheelers are very less in %. The table is inferred that some of the models are
very less in market. This formed the basis of the study.
Page 46


Chart 4.1 Showing type of Hero two wheeler models owned in %

IMPULSE
1%
HF DAWN
1%

PASSION XPRO
9%

PLEASURE
6%

SPLENDOR PLUS
25%

SUPER
SPLENDOR SPLENDOR NXG
5%
2%
MAESTRO
KARIZMA 3%
1%

SPLENDOR PRO
10%

KARIZMA
ZMR
2%
GLAMOUR
3% HUNK
2%

PASSION PRO
30%

Page 47


Table- 4.2 showing the source of information about Hero

Sources

No. of respondents

News paper ads

9

Television ads

57

Roadside Boarding‘s

14

Others

20

Total

100

Inference:
From the above table it is inferred that people are getting information about hero two wheelers
from television ads, more than 50% of people are watching TV ads. Roadside Boarding & news
paper are less in performance; other sources contain motor shows, internet ads.

Page 48


Chart 4.2 showing the source of information about Hero

News paper ads

Television ads

Roadside Boarding’s

others

9%
20%

14%

57%

Page 49


Table- 4.3 showing the influenced people for buying Hero

Influenced people

No. of respondents

Family

34

Myself

16

Friend

35

Sales representative

15

Total

100

Inference: From the above table it is observed that, the buying behavior people mostly
influenced by family and friends the other factor is have less level of influence. The people how
using bike mostly youth & middle class people and they are influenced by their friends and
family respectively. The above table showing that 35% of people influenced by their friends
34% people through family 16% people is buying on their need. 15% because of sales
representative
Page 50


Chart 4.3 showing the number people influenced for buying

40

35

30

25

20

15

10

5

0
family

Myself

friend

Sales representative

Page 51


Table- 4.4 showing the preference of capacity & colour
Capacity

No. of respondents

Preference of color

No. of respondents

100cc

17

Blue

23

125cc

28

Red

24

150cc

35

Black

39

200cc

20

Other

14

Total

100

Total

100

Inference: From the above table it is observed that, the bike ‗cc‘ preference is deferent customer to
customer but the 35% people like 150cc bike and 28% like 125cc, 200cc bike 20% others
100cc.e preference of color ‗BLACK‘ is rating at near to 40% of people after that 24% like Red
color 23% Blue also . Other color like white getting less importance in selection

Page 52


Chart 4.4(1) showing the preference of capacity

40
35
30
25
20
15
10
5
0
100 cc

125cc

150cc

200cc

Chart 4.4(2) showing the preference of colour

45
40
35
30
25
20
15
10
5
0
Blue

Red

Black

Other

Page 53


Table- 4.5 showing the responses on Vehicle delivery time

respondents

No. of respondents

Yes (on time)

78

NO (not on time)

22

Total

100

Inference: From the above table it is observed that,
78% of respondents got delivery of their vehicle on time
22% says that the delivery of vehicle got delay
After enquire about the 22% it‘s showing that they asked for very demand vehicle like
PASSION & SPLENDOR bikes and some of them ask new bike like Maestro

Page 54


Chart 4.5 showing the responses on Vehicle delivery time

No
22%

Yes
78%

Page 55


Table- 4.6 showing availability test drive during on showroom visit

Respondents

No. of respondents

Yes

92

NO

8

Total

100

Inference: From the above table it is observed that, 92% of respondents got test drive during their
showroom visit, other 8% didn‘t got because of two reason some of them ask the bike that not
showcase in showrooms and some of them gone small showrooms

Page 56


Chart 4.6 showing availability test drive during on showroom visit

Yes
No

Page 57


Table- 4.7 showing the reliability of Vehicle

Respondents

No. of respondents

Excellent

16

Good

23

Moderate

21

Satisfactory

39

unsatisfactory

1

Total

100

Inference: The above table shows how the customer rate the reliability of Hero bike, it is observed
that 16% of them telling its excellent 23% respond that its good and 21% have moderate
opinion 39% is satisfied with the performance and 1 of the respondent is not satisfied with
the Hero bike.

Page 58


Chart 4.7 showing the reliability of Vehicle

45
40
35
30
25

Excellent
Good
Moderate

20
15

Satisfactory
unsatisfactory

10
5
0

Page 59


Table- 4.8 showing level of Service Satisfaction

Respondents

No. of respondents

Completely satisfied

34

satisfied

39

dissatisfied

12

Not at all satisfied

15

Total

100

Inference:The above table shows the satisfaction towards Hero bike on the time of Service 34% of
respondents are completely satisfied with the service provide by the company and 39%
customers are satisfied and 12% dissatisfied, 15% is not at all satisfied with the service provide
by the company the following chart shows it more clearly

Page 60


Chart 4.8 showing level of Service Satisfaction

40
35

Completely satisfied

30
25
20

satisfied

dissatisfied

15
10

Not at all satisfied

5
0

Page 61


Table- 4.9 showing the brand name influence in purchase

Respondents

No. of respondents

Percentage

Yes

74

74%

NO

26

26%

Total

100

100%

Inference:From the above table it is observed that, the customers are influenced by the brand name
―HERO MOTOCROP‖ 74% of respondents are influence by the brand name and 26% are not
the brand ―HERO‖ is the most selling bike in India and Its is the brand that selling more bike in
the world also

Page 62


Chart 4.9 showing the brand name influence in purchase

No
26%

Yes
74%

Page 63


Table- 4.10 showing the reason for preference
Preference

No. Of Respondents

Percentage

Quality

25

25%

Price

20

20%

Brand Image

24

24%

Fuel efficiency

31

31%

TOTAL

100

100%

INTERPRETATION:
From the above table we can infer that 25% of the respondents gave preference to quality,
20% of respondents gave preference to price, 24% of respondents gave preference to brand
image and 31% of the respondents gave preference to fuel efficiency.
From the above findings, we can analyze that 69% of respondents were more quality conscious
and only 31% respondents gave preference to price and fuel efficiency.
The reasons are even though people are price conscious to some extent; the consumers are
more quality conscious than price conscious because they have enough income to buy twowheeler.

Page 64


Chart 4.10 showing the reason for preference

35

30

25

20

15

10

5

0
Quality

Price

Brand Image

Fuel efficiency

Page 65


Table - 4.11 showing how long customer using hero two wheelers

Time period

No. Of Respondents

Less than 6 month

24

6-9 month

23

9 -1 year

32

More than 1 year

21

TOTAL

100

Inference:From the above table we can infer that how long the customer holds the bike the split between
Hero and Honda happen less than 3 year back and this table help to know the using period of
customer 79% of people that in the research is brought their bike in the last year and 21% is
using the bike more than 1 year.

Page 66


Chart 4.11 showing how long customer using hero two wheelers

0

5

10

More than 1 year

15
9 -1 year

20
6-9 month

25

30

35

Less than 6 month

Page 67


Table - 4.12 showing the area that Customer demanding to improve in service
Area

No. Of Respondents in %

Service in time

31

Reliable service

16

Well trained mechanics

27

less labor charge

26

TOTAL

100

Inference:From the above table it is observed that, what is customer need that Hero wants to improve,
31% need improvement in service in time, 16% in reliable service, and 27% need well trained
mechanics, 26% less labor charge.

Page 68


Chart 4.12 showing the area that Customer demanding to improve in service

Chart Title
35
30
25
Service in time

20

Reliable service
15

Well trained mechanics
less labor charge

10
5
0
Category 1

Page 69


Table - 4.13 showing the problems face at the time of service

Responses

No. Of Respondents in %

High price spare parts

29

Low quality of spare parts

14

Delay in service

29

No problems

28

TOTAL

100

Inference:From the above table it is observed that, the customers are facing deferent problems at the
time of service, 29% face high price of spare parts, 14% face low quality of spare parts, 29%
face delay in service, 28% respondents they didn‘t face any problem.

Page 70


Chart 4.13 showing the problems face at the time of service

Problems face at the time of service

No problems
28%

Delay in service
29%

High price spare
parts
29%

Low quality of
spare parts
14%

Page 71


Table - 4.14 showing the rating of Service Performance of Hero Motors

Response

NO. OF RESPONDENTS

PERCENTAGE

Very good

34

34%

Good

20

20%

Average

32

32%

Bad

8

8%

Very Bad

6

6%

TOTAL

100

100%

Inference:From the above table it is observed that, 34% of customer says service performance gives by
Hero MotoCorp Ltd, Is very good and 20% says it‘s good , 32% says the service is average,8
respondents says the service is bad and 6% says it‘s very bad, To overall we can conclude
that more than 85% is satisfied with the service provide by Hero MotoCorp Ltd.

Page 72


Chart 4.14 showing the rating of Service Performance of Hero Motors

Chart Title
40
35
30
25

Very good
Good

20

Average
Bad

15

Very Bad
10
5
0
Response

Page 73


Table - 4.15 showing the good thing associate with your brand

Response

NO. OF RESPONDENTS

PERCENTAGE

Solid engineering

16

16%

Innovative features

25

25%

Value of money

21

21%

High and consistent mileage

29

29%

Better after sale service

9

9%

TOTAL

100

100%

Inference:From the above table it is observed that, what the customer feel that make Hero deferent from
other bike, 16% like the solid engineering, 25% says innovative features is good about Hero
MotoCorp , 21% respond that Hero giving the value of money, 29% brought because of
consistent mileage of Hero,9% like after sale service of Hero MotoCorp Ltd.

Page 74


Chart 4.15 showing the good thing associate with your brand

good thing associate with your brand
Solid engineering

Innovative features

Value of money

High and consistent mileage

Better after sale service

9%

16%

29%
25%

21%

Page 75


Table - 4.16 showing the friend recommendation for Hero bikes

Respondents

No. of respondents

Percentage

Yes

82

82%

NO

18

18%

Total

100

100%

Inference:From the above table it is observed that, Out of the respondents 82% people will recommend
Hero bike to their friends it‘s showing the 82% of customer are satisfied with their Hero bike,
and the remaining 18 % because of some reason not recommending Hero bike to their friends

Page 76


Chart 4.16 showing that recommendation to Hero bikes

No
18%

Yes
82%

Page 77


SUMMARY OF FINDINGS

1. The Hero MotoCorp is leading the market. The difference is too big to cope up with, for
any manufacturer in short span. With proven products and many people having faith in
brand, it is quite a difficult task for others to take the Hero‘s number one position.
2. Hero MotoCorp India‘s no. 1 two wheeler companies have posted growth of 11.28% in
the month of May 2012 compared to May 2011.
3. Ability to understand customer‘s needs and wants, maintenance cost is low.
4. Passion Pro, Splendor Plus, are the two models that Hero MotoCorp selling a big
number
5. The TV promotions are more influence the customer behavior of two wheeler sector.
6. The purchase desiccations of consumers are influence by friends and family.
7. Blue, Red, Black color bike with 150 cc to 200cc is fast moving.
8. Most of the despondences are agree that the bikes are delivering proper time.
9.

The service provide by Hero MotoCorp is satisfied by more than 70% of customers.

10. Brand name of Hero is still good in market after split with Honda, 74% of people like
the brand ―HERO"
11. Quality, price, Brand image, Fuel efficiency is getting equal importance in satisfaction
12. The research showing that consumer want to get more service satisfaction.
13. 82% of the customer likes to recommend Hero two wheeler to their friends, its shows
they are satisfied with the bike.

Page 78


SUGGESTIONS AND RECOMMENDATIONS
It is very hard to hold the pulse of a customer in the market. Customer‘s satisfaction is different
for different people at different situations;

Majority of the respondents were still unaware about different versions of Hero bikes.
Therefore I suggest the company personals should take initiative to create awareness
about these versions.
Few of the customers expressed concern over frequency of the maintenance & service
problems faced by their vehicle and expressed ‗high satisfaction‘ over it. Therefore, I
suggest them to re look at the vehicle & re-develop in order to stop the frequency of
these problems.
Hero MotoCorp want to give more importance in there service part its include timely
service, and quality of service
Hero want to develop more promotion for there some models like sports bike and gear
less scooter
Hero bikes want to increase their export market
Hero MotoCorp Ltd should try to give more advertisements in news paper, bill boards
in that area to enable easy recall of the people for Hero MotoCorp Ltd.

Page 79


CONCLUSION
Customer satisfaction is a marketing tool and a definite value added benefit. It is often
perceived by customers as important as the primary product or service your organization offers.
For making a better relationship with customer they always use genuine parts in their product.
And after selling they have the services and maintenances. Their constant endeavor is to
support the company's mandate of providing highest level of customer satisfaction by taking
good care of customer‘s two-wheeler service and maintenance through their vast network of
more than 2100 committed dealers and service outlets spread across the country.
Apart from that hero MotoCorp Ltd focused on cleanliness and other aesthetics of the service
stations and add such air conditioned waiting area, internet surfing, coffee shops etc to
enhance the in house experience of the customers at those ―customer touch point‖. To ensure
that millions of customers in the rural area are not left waiting for adequate service as it is
impossible for the company to introduce service station at every nook and corner of the
country, mobile service stations are regularly arranged with prior intimation to public about the
rout that the mobile workshop would take when passing through that region so that customers
can come and get their two wheelers serviced. All these activities are aimed to increase the
customer loyalty and thus retaining customers.

Page 80


Measuring Customer Satisfaction in Hero Motors

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