Hero Honda unveils ‘World No 1’ promotions, enhance ad and promo budget

The Rs 4,539.49-crore Hero Honda Motors Ltd (Hero Honda) is thrashing out an aggressive strategy to support its ‘World No 1 Celebration’ project. It will also enhance its advertising and promotion (A&P) budget to Rs 110 crore in fiscal 2002-03, up from Rs 92 crore in 2001-02. It will also launch the second phase of its successful loyalty and reward initiative ‘Passport Programme’ beginning May 2002.

The company became the world’s largest two-wheeler company by volume sales of 1,425,302 motorcycles in fiscal 2001-02 up from 1,029,510 units in the last fiscal.

While the A&P budget will be allocated as two per cent of the overall turnover, the Celebration project will be financed through internal savings. Under the Celebration project, Hero Honda is offering a price benefit of Rs 1,001 across all Hero Honda models.

By a rough reckoning, at the retail front, the Celebration project should cost Hero Honda around Rs 180.18 crore if it meets its sales target of 18 lakh motorcycles in fiscal 2002-03.

Hero Honda plans to launch shortly the second phase of its successful Passport Programme, a customer relationship programme, which it launched last year to reward and retain Hero Honda buyers.

Under the new thrust, Hero Honda will soon launch co-branded loyalty cards and a host of promotional activities. The company plans to double the number of Passport holders to one million this fiscal.

Besides winning new customers, the Passport Programme is also indicated to have brought additional spares and sales businesses to Hero Honda dealerships.

Hero Honda has set a spare parts sales target of Rs 250 crore in 2002-03 up from Rs 203 crore in 2001-02.

Hero Honda’s enhanced A&P budget is intended at supporting a range of new motorcycle launches — including the new 100-cc Dawn which is priced at Rs 37,000 and replaces Joy — besides maintaining its existing portfolio.