What attributes/features should

Honda include in the new model of

A-segment car and what should be
the target segment that it should
eye for?
 Group 4:
 Deepak Dugar (u109064)
 Abhinav Mittal (u109053)
 Jagrat Kumar Bhanja (u109171)
 Ashish Chaudhary (u109177)
 Anubhav Gupta (109175)
 Vikas Gautam (u109100)

Contents
 Introduction
 Marketing Objective
 Research Objectives
 Key Information Areas
 Quantitative Analysis
 Qualitative Analysis
 Findings and Conclusion
Introduction
 Honda, one of the leading auto makers has decided to come up with a new
car in the A-segment.
 This new concept car has been code-named Honda 2-CV and is to be
launched in the Indian market.
 The present research is aimed at assisting Honda to determine the segment
(in terms of demographics) that it would be targeting and to zero down
on a set of attributes that would be required to be included in the car for
it to be successful.
Marketing Objective
 What attributes/features should Honda include in the new model of A-
segment car?
Research Objectives
 Identifying the target segment for the A segment car.
 Identifying the most significant attributes which a customer expects in an A
segment car

Key Information Areas
 User Demographics
 Economic status
 Awareness about the A class segment
 Reason for Purchase
 Desired Features
 Brand Image and Perception
 Price
 Performance and Usage

Variables
 Age
 Gender
 Education
 State (Geographical Location)
 Occupation
 Owning car or not
 Income
 Mileage of the car (Fuel Efficiency)
 Safety
 Environment friendliness
 Comfort
 Awareness
 Usage of the car – Heavy use/ intermittent use and single/family use
Quantitative Analysis
 Univariate Analysis
 Factor Analysis
 Cross Tabulation
 Jaccard Analysis
 SWOT Analysis
 Stochastic Analysis
Data Collection Methodology
 Online survey form (Google docs)
Pilot Test

 Size : 15

 Male: 10 Female: 5
 XIMB : 9(M:6 F:3) Others : 6(M: 4 F:2)

Result:
Modified 2 questions


Validating Responses
 Total Responses Obtained : 110
 Bad/Incomplete Response : 11
 Responses taken for Analysis : 99

Univariate Analysis
 Age
Fa cto r A n a lysis
 Different attributes taken for analysis are as given below:
1. Fuel Efficiency
2. Engine Efficiency
3. Air Conditioner
4. Seat Belt
5. Seating Capacity
6. Leg Space
7. Low Emission
8. Power Steering
9. Air Bags
10. Anti-Lock Breaking System
11. Self Parking
12. GPRS
13. Color
14. Turning Diameter




KMO and Bartlett's Test



Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .882

 Bartlett's Test of Sphericity Approx. Chi-Square 1.485E3


df 231

Sig. .000


 KMO is equal to .882

 This shows that number of samples taken is adequate



Communalities
Initial Extraction
Colour 1.000 .666
PowerSteering 1.000 .740
SeatingCapacity 1.000 .748


SelfParkingSystem 1.000 .596
AC 1.000 .720


SeatBelt 1.000 .666
DriverAssistanceSystem 1.000 .538
FuelEff 1.000 .763
AltFuel 1.000 .731
LowEmission 1.000 .749
AirBags 1.000 .731
ChildSafetyLock 1.000 .643
MobileCharging 1.000 .532
GPRS 1.000 .689
TurningDiameter 1.000 .595
FloorConsole 1.000 .623
ErgonomicDesign 1.000 .577
CollapsibleStreeing 1.000 .723
AntiLockBreaking 1.000 .698
FuelTank 1.000 .547 Here all variables have
EngineEff 1.000 .794
communalities > 0.5 which
means that they have sufficient
LegSpace 1.000 .727
explanation
Extraction Method: Principal Component Analysis.
 Total Variance Explained
Componen Initial Eigenvalues Extraction Sums of Squared Loadings Rotation Sums of Squared Loadings
t
Total % of Variance Cumulative % Total % of Variance Cumulative % Total % of Variance Cumulative %

1 9.637 43.807 43.807 9.637 43.807 43.807 5.448 24.765 24.765

2 2.889 13.134 56.940 2.889 13.134 56.940 3.989 18.131 42.895
3 1.175 5.342 62.282 1.175 5.342 62.282 3.445 15.660 58.555
4 1.092 4.963 67.245 1.092 4.963 67.245 1.912 8.690 67.245
5 .969 4.405 71.650
6 .930 4.229 75.879
7 .672 3.056 78.935
8 .564 2.564 81.500
9 .521 2.370 83.869
10 .477 2.170 86.039
11 .441 2.005 88.045
12 .428 1.946 89.990
13 .380 1.727 91.717
14 .346 1.573 93.290
15 .288 1.310 94.601
16 .268 1.219 95.820
17 .196 .892 96.712
18 .187 .851 97.563
19 .154 .702 98.265
20 .144 .655 98.920
21 .132 .601 99.521
22 .105 .479 100.000
Extraction Method: Principal Component Analysis.

 This shows that the given data can be factorized into four factors
Rotated Component Matrixa
Component
1 2 3 4
FuelEff .860
EngineEff .859
LowEmission .741
SeatBelt .734
AC .722
LegSpace .707
SeatingCapacity .686 .461
PowerSteering .608 .583
AirBags .767
AntiLockBreaking .733
CollapsibleStreeing .730 .408
ChildSafetyLock .685
ErgonomicDesign .612
FuelTank .436 .536
TurningDiameter .507 .447
SelfParkingSystem .726
GPRS .719
AltFuel .466 .692
DriverAssistanceSystem .682
MobileCharging .638
FloorConsole .460 .503
Colour .743
Extraction Method: Principal Component Analysis.
Rotation Method: Varimax with Kaiser Normalization.
a. Rotation converged in 6 iterations.

The rotated component matrix shows the different variables under the four factors
Factor Analysis_iteration 2
 After performing the first iteration, we see that engine efficiency and fuel efficiency have a high
correlation co-efficient (.830) with a high significance level (.000).


 Thus we drop engine efficiency and perform the second iteration.




Total Variance Explained
Compone Initial Eigenvalues Extraction Sums of Squared Loadings Rotation Sums of Squared Loadings
nt
Total % of Variance Cumulative % Total % of Variance Cumulative % Total % of Variance Cumulative %
1 9.147 43.559 43.559 9.147 43.559 43.559 5.011 23.860 23.860
2 2.659 12.664 56.223 2.659 12.664 56.223 3.947 18.796 42.656
3 1.175 5.593 61.816 1.175 5.593 61.816 3.396 16.173 58.828
4 1.065 5.069 66.885 1.065 5.069 66.885 1.692 8.056 66.885
5 .969 4.614 71.498
6 .914 4.350 75.849
7 .672 3.198 79.047
8 .564 2.684 81.731
9 .520 2.476 84.208
10 .477 2.270 86.477
11 .437 2.082 88.560
12 .411 1.958 90.517
13 .350 1.665 92.183
14 .331 1.575 93.757
15 .287 1.368 95.125
16 .242 1.152 96.277
17 .195 .929 97.207
18 .173 .822 98.028
19 .151 .719 98.747
20 .137 .651 99.398
21 .126 .602 100.000
Extraction Method: Principal Component Analysis.

This again shows that the given data can be factorized into four factors
Rotated Component Matrixa
Component
1 2 3 4
FuelEff .829
AC .767
SeatBelt .760
SeatingCapacity .741
LegSpace .738
LowEmission .724
PowerSteering .682 .505
AirBags .767
AntiLockBreaking .739
CollapsibleStreeing .725 .401
ChildSafetyLock .680
ErgonomicDesign .617
FuelTank .441 .538
SelfParkingSystem .721
GPRS .717
AltFuel .443 .697
DriverAssistanceSystem .688
MobileCharging .633
FloorConsole .457 .481 .447
Colour .416 .677
TurningDiameter .503 .508
Extraction Method: Principal Component Analysis.
Rotation Method: Varimax with Kaiser Normalization.
a. Rotation converged in 8 iterations.
The rotated component
matrix shows the
different variables
under the four factors
Summary of Factors
 FACTOR 1 - PERFORMANCE AND COMFORT
 Fuel Efficiency
 Air Conditioner
 Seating Capacity
 Leg Space
 Power Steering
 Low Emission
 Seat Belt.


 FACTOR 2 - SAFETY
 Air bags
 Anti-lock Breaking System.

 FACTOR 3 - DRIVER ASSISTANCE SYSTEMS
 GPRS
 Self Parking System.


 FACTOR 4 - OTHER FEATURES

 Color
 Turning Diameter.

Cross Tabulation
 Importance to various attributes given according to Age

 Importance to various attributes given according to Gender

 Importance to various attributes given according to Educational Qualification

 Importance to various attributes given according to Occupation
 Importance to various attributes given according to Type of Family
 Importance to various attributes given according to Annual Income
 Importance to various attributes given according to Car Ownership Status

JACCARD ANALYSIS


 Establishes which attributes are important to consumers.



 By looking at the calculated Jaccard scores, one can make out

the most preferred attributes that serve as the primary drivers
among a set of attributes.
JACCARD ANALYSIS
 Respondents asked about their preferred brand of cars. (Given
options: Maruti, Hyundai, Tata, Others)
 They had to rank a given set of attributes in a way which they
felt had the greatest value for them.
 Give us a fair idea about the attributes that are presently the
most preferred ones in the existing brands of cars and would
thus provide Honda with a lead on which are the most
important parameters that it should keep in mind while
targeting the Indian customers.

JACCARD ANALYSIS
l A ‘YY’ score = those who prefer the brand overall and associate the brand with a
particular positioning
l A ‘YN’ score= those who prefer the brand overall but do not associate the brand with
a particular positioning; and
l A ‘NY’ score = those who do not prefer the brand at overall level but still associate the
brand with a particular positioning


 YY across all the

brands

Jaccard Score = -------------------------------------
 Σ (YY score + YN score + NY score) across all the brands
JACCARD ANALYSIS
 Cut-off Jaccard score used: 0.6


 Attributes with Jaccard Score above 0.6 ----- Primary Drivers



 Total number of attributes taken: 22

 No. of Primary Drivers identified: 11
JACCARD ANALYSIS
 FINDINGS:
 Primary Drivers Identified:
 Engine Efficiency
 Fuel Efficiency
 Seating Capacity
 Air Conditioner
 Power Steering
 Leg Space
 Seat Belts
 Low Emission
 Fuel Tank
 Antilock Breaking
 Colour
JACCARD ANALYSIS
 CONCLUSION:
 It is clear that while deciding on the features to be incorporated
into its new A-segment car, Honda should take into
consideration the findings of this analysis and direct its focus
on giving more importance to the above mentioned
attributes.
 Most preferred ones are the engine and fuel efficiency which
shows that when it comes to A-segment cars, customers
generally prefer efficiency over comfort and looks.



STOCHASTIC SHARE ANALYSIS

Brand % Preferred Ratio Stochastic Share

Set

Maruti preference 42.42 1.12 37.91 39 . 42

Hyundai preference 32.32 1.16 27.96 29 . 07

TATA preference 16.16 1.00 16.16 16 . 81

Others preference 14.14 1.00 14.14 14 . 70

TOTAL 96.17 100.00

Inputs through STOCHASTIC
Analysis
Inputs for HONDA
SWOT Analysis
MARUTI
HYUNDAI
TATA
OTHERS
 Inputs to HONDA
to counter competitors
Qualitative Analysis
 Focus Group Discussion
FOCUS GROUP DISCUSSION
(Transcript)
 1.Introduction
 The introduction was basically an ice breaking exercise where
the group members introduced themselves and talked about their
hobbies.


 2. Category Exploration
 The moderator tried to come up with an understanding of the
market and the segments of the market. This involved the estimation
of cost they are willing to shell out for a vehicle, their frequency of
usage, their preference when they travel and commute. It also
involved the attributes they look for in a vehicle the most. Cost vs
Comfort. Fuel efficiency Vs Environment friendliness. Safety
features desired.

Transcript (Contd….)
 3. Brand Awareness and Usage & Benefits:
 In these sets of questions we tried to find out the brand
knowledge and awareness level of Honda.


 4. Brand Perception and Personality:

 We tried to get an idea about the way different people perceive
the brand as against its top competitors. The top thing that they
associate with the Honda brand.

FOCUS GROUP DISCUSSION-
1
 Date: March 19th , 2010
 Participants:
 Abhinav Mittal (Moderator)
 Respondent 1 : Renuka Elizabeth George
 2: Umang Agarwal
 3: Ruchira Vats
 4: Juhi Agarwal
 5: Swati Garnaik
 6: Kanmaani S.

FOCUS GROUP DISCUSSION-
1
 Introduction:

Respondent 1: Native of Kerala. Graduation in Economic Honours from
St.Xaviers,Kolkata. No work experience. Hobbies include painting, reading.

2: IT engineer. Work experience of 3 years in Infosys. MBA student now in XIMB.
Hometown is Jaipur,Rajasthan. Hobbies include watching movies.

3: IT graduate. Work exp of 6 months in SBI. Hometown – Muzzafarpur, Bihar.
Hobbies include watching movies and reading novels.

4: Native of Jaipur. B.E in electronics and communication. Fresher. No work
experience. Hobbies include sleeping and chatting.

5: Native of Rourkela. Engineering in Mettalurgy from NIT Jaipur. 6 months of
work experience in Cognizant, Pune. Hobbies include reading and listening to
music.

6: Native of Coimbatore. B.Tech in IT. 2 months of work experience in Mindtree.
Hobbies are reading books.


Key Findings
 Exploration about Usage, Ownership and Attributes desired
 Most of the respondents had a car in the family. Used it
mostly for weekend trips with the family


Respondents Cost/Comfort Environment Specific Features

friendly/Fuel Efficient Desired

1 Cost Environment Leg Space, Seat Belt,

power windows
2 Both Fuel Efficient Leg Space, Seat Belt

3 Comfort Fuel Efficient NA

4 Comfort Fuel Efficient Good Looks

5 Comfort Fuel Efficient A/C, Music System

6 Cost Fuel Efficient Leg space, A/C

 Brand Awareness and Usage & Benefits


Respondents Brand owned and Preferred Brand What about Honda?

Dislikes with present
brand(if any)

1 Maruti Hyundai Long Car Maker

2 NA Maruti Leg Space, Seat Belt

3 Maruti Maruti Sedans

4 Maruti Maruti, Hyundai Sedans

5 Maruti Alto (Dislike- Maruti Long Car

Leg space)
6 Hyundai Fuel Hyundai Honda City
 Brand Perception and Personality


Respondents Perception about What do you like about Competitors

Honda’s A-Segment Honda
Car

1 Positive Aesthetic Interiors Hyundai, GM

2 Positive Stylish Design Tata, Maruti

3 Neutral Looks & Designs Maruti & Hyundai

4 Mildly Positive Looks Maruti & Hyundai

5 Very Positive Design Hyundai & GM

6 Positive Nothing specific Maruti & Hyundai

FOCUS GROUP DISCUSSION-
2
 Date: March 18th , 2010
 Ashish Chaudhry (Moderator)
 Respondent 1:Saurabh Kumar
 2: Charlie kishore
 3: Varun Rawat
 4: Abhijeet Srivastav
 5: Ankit Arora
 6:Ankit Agarwal



FOCUS GROUP DISCUSSION-
2
 Introduction:
 Respondent 1: Approx. 2 years of work experience in an IT Co. The Hobbies
include playing cricket and musical instruments sleeping. Engineer graduate.
 2: An Engineering graduate, Approx. 2 year of Work experience in Nokia Siemens in
Bangalore. Hobbies include watching movies, reading and playing various sports.
Has been here in Orissa for past 9 months since came to XIMB. Was in
Bangalore for past 6 years.
 3: Approx. 2 years of work experience with leading IT Co. Hobbies includes playing
cricket and driving. Has been residing in Orissa for past 9 months.
 4: An Engineering graduate, No work experience. Hobbies include watching movies,
music, playing games on computer and making sketches.
 5: Almost 2 years work experience. Hobbies include watching and playing cricket
and table tennis. Have been residing in Orissa for past 9 months.
 6: Native of Rajasthan. No Work experience. Hobbies include playing cricket and TT
and listening music.

Key Findings
 Exploration about Usage, Ownership and Attributes desired
 Most of the respondents had a car in the family, some had
two
 Respondents Cost/Comfort Environment Specific Features
friendly/Fuel Efficient Desired

1 Cost Both Good looks, safety

2 Both Fuel Efficient Stylish looks, smart

accessories, youth
3 Comfort Fuel Efficient NA
appeal
4 Comfort Fuel Efficient Seating capacity, safety,
looks
5 Cost Fuel Efficient Power steering, power
windows
6 Cost Fuel Efficient Simple features
 Brand Awareness and Usage & Benefits


Respondents Brand owned and Preferred Brand What about Honda?

Dislikes with present
brand(if any)

1 Hyundai Hyundai Would go for the A-

segment car
2 Maruti, Honda Both Style and Elegance

3 Maruti Maruti Goodwill

4 Maruti Maruti Long Car

5 Maruti Hyundai Likes Honda

6 NA Maruti Might not go for it

 Brand Perception and Personality


Respondents Perception about What do you like about Competitors

Honda’s A-Segment Honda
Car

1 Positive Smart looks & Design Hyundai, Maruti

2 Very Positive Elegance, Overall Believes it would be a

package niche
3 Neutral Would like to compare Maruti & Hyundai
features with others
4 Neutral Good in long car Not aware
segment
5 Mildly Positive Status symbol Did not mention

6 Negative Likes looks but prefers Maruti & Tata

others over it
Conclusion
 The respondents were equally divided on the need for comfort
and concern for cost.


 Fuel efficiency is preferred to Environment friendliness.



 Although most of the respondents relate A-segment cars to

Maruti and Hyundai and Honda to bigger cars, they are open
to the idea of going for a small car from Honda.
