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Studi comparativi cross-country

29 Luglio 2011 • di Oana Faraon

Market opportunities in India. Case study: Piaggio G

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This paper analysis the potential of the Indian market representing the basis for the marketing plan of selling the new Vespa LX 125 model. This consists in market audit and preliminary marketing plan that describe the target market and specific product, price, promotion and distribution strategies.

Questo ampio intervento indaga il potenziale del mercato Indiano, base del marketing plan per l’introduzione del nuovo modello Vespa LX 125. L’indagine si concentra sul controllo delle attività di marketing e sulle attività preliminari del plan: descrizione del target e analisi del marketing mix.

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Executive summary

India is a country of contrasts, marrying huge potential with profound and chronic challenges. Regarded by some historians as the "oldest living civilization of Earth", India has a continuous recorded history since the time of the Vedas for over 5000 years. Several elements of India's diverse culture, such as Indian religions, yoga and Indian cuisine, have had a profound impact across the world. Its recent high economic and social growth rates have improved the prospects that the world’s second most populous country will be able to raise incomes broadly for its 1.189 billion people, population expected to rise to 37% by 2025, making India by far the largest home for education services consumers in the world. And yet India has the highest illiterate adult population in the world, more than three times the size of China.
Beside all this elements, such as beliefs, religion, traditions, sports, cuisine, music, clothing, that make India fascinating to the rest of the world, it hides beneath it all overwhelming issues like high rates of poverty, malnutrition, illiteracy, corruption and injustice, discrimination and inequality between men and women. Both positive and negative aspects regarding India have a great importance in analyzing its potential because in this way it is possible to minimize the risk of encountering unexpected facts or events that might endanger the success of the marketing plan.
No doubt that the Indian economy has been treading an exceptional growth path since the last decade and its diverse economy encompasses traditional village farming, modern agriculture, handicrafts, a wide range of modern industries, and a multitude of services. Therefore India represents a huge potential for any manufacturer to try to sell its product on this market. The Italian auto maker Piaggio is planning to manufacture two wheelers in India in the coming years, as part of the company's growth plans for Asia, beginning with a Vespa LX 125 model specially developed for the Indian market. Detailing the company's strategic plan for the 2009-2012 period, Piaggio aims to create the conditions for strong growth in Asia. As part of the plan, the firm would strengthen its direct industrial presence and also increase the offering of two-wheel vehicles to be produced in India as well and commercial vehicles, backed by the development of distribution structures, organization, and human resources. Piaggio India truly represents a seamless integration of the best of skills, technology, design research and customer care with Indian resources, infrastructure, intelligent manpower, marketing and financial skills, and most importantly, a deep understanding of the Indian market and customer needs.
Vespa is the expression of a uniquely distinctive lifestyle. Its enduring success owes much to its extraordinary origins and to its symbolic and iconographic identity. Through a combination of cultural sensitivity and constant innovation, the brand continues to surprise and delight fans all over the globe. Style is therefore an important part of Vespa’s competitive advantage, as are engineering, affordability and eco-friendly operation. The psychographic and demographic profile of the target consists in young business men and women, with an age between 18–45 years, medium to high educated, belonging to middle to high class income, characterized by combining utility with fun and style.
The reason to support this plan of selling Vespa into the Indian market is that as of 2006, private motorized transport (mainly cars and motor scooters) accounted for a small but rapidly growing percentage of travel, about 10–20% of all trips. Public transport use for social and recreation trips is low while use of three wheelers and personalized modes like cars and two wheelers is high. This is because comfort is the first priority for social trips and cost is secondary. The data presented indicates that two wheelers mainly serve those going to work, while three wheelers are used for education, recreation and shopping.
Shopping habits of Indians are changing due to their growing disposable income, relative increase in the younger population, and the change in attitudes towards shopping. The emphasis has changed from price consideration to design, quality and trendiness. The desire to look and feel good is also guiding factor for customers while making their purchase decisions.
The Piaggio Plan for the Indian market will entail investments totaling 30 million euro in financial years 2010 and 2011, with the goal of achieving revenues of approximately 70 million euro in 2015 – when investment payback is projected – on sales of approximately 110,000 scooters. The new Piaggio industrial initiative in India will have the support of the Group’s local industrial and commercial operations through the Piaggio Vehicles Private Ltd. Subsidiary. Taking also in consideration that the cost for labor and capital are lower than in other countries, the retail price can be set at € 840 or Rs 55000. The promotion aspects will concentrate on three characteristics of Vespa: fun, fashion, freedom, because Vespa is not just a scooter, is a way of life.
Taking in consideration all facts, the new Vespa LX 125 will have a great success on the Indian market, as it had in all other countries around the world.



1. Introduction
2. The product
2.1 Product evaluation
2.2 Major problems/resistances to product acceptance
3. Market analysis
3.1 Target market (s)
3.2 Geographical region(s)
3.3 Estimated market sales for the planning year
3.4 Consumer buying habits
4. SWOT Analysis
5. Competitor analysis
5.2 Competitor’s product(s)
5.2 Competitors’ price
5.3 Competitors’ promotion and advertising methods
5.4 Competitors’ distribution channels
6. The price
7. The distribution
8. Advertising and promotion
9. Marketing objectives
Sources of information


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                                                                                                                               DOI 10.4439/ig9

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