Auto Manufacturers Begin More Promotions to Lure Customers

We had recently reported that May, witnessed the slowest sales growth in the Indian auto industry since the past 24 months. According to recent reports, with the hike in interest rates and fuel prices affecting the sales of cars in the last two months, car manufacturers have begun investing heavily in advertising and other promo activities to get consumers buying again.

Maruti Suzuki, India’s leading passenger car manufacturer has lined up INR 15 to 20 crore to spend on promotions and campaigns for May-June, apart from introducing four different campaigns that cost INR 4 to 6 crore each, while South Korean car manufacturer, Hyundai increased their marketing budget. Honda Siel is also banking on inexpensive car loans via its dealers to boost their sales.

The chief GM of marketing for Maruti Suzuki said that as a leader in this market, they have to resume their sales momentum. To do this, they have come out with a comparatively large budget. While in the past two years, the company focused on tactical brand building in the summer, they have now moved towards strategic advertising in a bid to regain their sales momentum.

Sales growth slowed down to 7% in May, it’s lowest in two years, urging car manufacturers to look towards innovative packaging and different marketing options for countering the decrease in demand that is likely to go on in the monsoon season. The company’s strategy for bringing in customers at its service centres and dealerships comprises of campaigns for their SX4 sedan and small Alto car, which are both priced at INR 4 to 5 crores.

Though their campaign for Alto began during the start of June and will continue till four weeks, they had launched a campaign for their SX4 by May end. A low ownership campaign was reportedly launched around this time that talked of low maintenance and running cost, fuel efficiency and the resale value of Maruti Suzuki cars.

The company also organised rallies to depict the mileage of their Wagon R and Alto vehicles, providing car accessories for their car models that according to them helped to double the enquiry levels at their service camps and showrooms. Hyundai is also increasing their marketing budget for countering drop in sales.

Hyundai’s director of sales and marketing, Arvind Saxena, said that they have had three months full of cricket mania with large spends on the IPL and ICC WC, helping their brand to remain on top. Taking forward this momentum, they are looking forward to aggressive advertising campaigns for June and the coming months, apart from offering a lot of discounts.

They have also fixed monetary packages for customers who opt for their petrol cars to help cushion the hike in petrol prices. Meanwhile, Honda Siel is targeting increased participation from their customers after they introduced discounts on interest charges on loans for their popular Jazz and City cars. Honda Siel’s Senior VP, Jnaneshwar Sen, said that they have been facing more demand for their diesel cars. As a result of which their dealers are providing vehicle loans at a rate of 6.99% for attracting more consumers.

Ford Motors will also launch a new multimedia campaign for their Fiesta sedan that is likely to come out by the second half of 2011.

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