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Mahindra & Mahindra has come up with a new brand strategy for its Alturas G4 luxury SUV launched in Jaipur last week.
This is the first vehicle from the M&M portfolio that will not have an ‘O’ at the end of its name (like the Scorpio, Bolero and Marazzo). Two, there is no SsangYong Motor branding association though the vehicle is known as the G4 Rexton in Korea.
Direct connect
Three, Alturas will take prominence while the Mahindra brand will endorse the product on the lines of what was done with the Scorpio launched in 2002. “We want brand Alturas to get prominence and are putting ‘By Mahindra’ below,” Pawan Goenka, Managing Director, M&M, told journalists at a roundtable. By doing this, customers will relate directly to the product and not the corporate brand. This has been done keeping in mind that this is the first luxury SUV from M&M with a price tag near the ₹30-lakh mark. The next in the hierarchy, in terms of pricing, is the XUV 500 which is sold for half as much.
Pricing strategy
Clearly, M&M’s strategy is to play up Alturas even if the corporate brand takes a backseat in the process. “That is what we did with Scorpio though we did not think it was necessary with XUV 500,” said Goenka. At that point in time, it was not that big a jump from Scorpio’s ₹8-9 lakh price to XUV’s ₹11-12 lakh price tag.
“Now we are going from ₹15-16 lakh of XUV to a price that is in the ballpark of ₹30 lakh. It is almost double from our current positioning and that is the reason why we decided to give prominence to Alturas,” he added.
The premium SUV space is hardly exciting in terms of numbers — about 4,500 units a month are sold — but significant in terms of brand positioning. The segment is dominated by models such as Ford Endeavour and Toyota Fortuner.
M&M believes that even a 10-12 per cent market share for Alturas would “really strengthen” its brand. “ This is a strategic and not commercial launch in terms of implications for the brand,” said Goenka.
Learnings from Rexton
The decision to underplay the SsangYong association was taken after a lot of deliberation. In Rexton’s case, it was important to establish the Korean connect. But today, customers are aware of this fact and there is really no reason to push the point.
“In the Indian context, having a Korean connect is valuable because there is a high credibility of the Korean ecosystem in terms of engineering, quality, fit & finish,” said Goenka. The SsaangYong association will extend to the S201 compact SUV, derived from Tivoli and due to be launched in the coming months. Yet, there is no reason to extend the Korean automaker’s brand to India.
“The Mahindra brand is well established and as long as there is a connect with Korean manufacturing and engineering, there is no need to establish a new brand which is a huge effort,” explained Goenka. According to him, the Rexton launched earlier did not do well because it was at the end of its lifecycle and customers did not want a dated product.
However, market observers believe the M&M decision could also have been spurred by the fact that customers in India are familiar with stronger Korean brands like Hyundai and Kia; the latter is due to launch its debut SUV next year.
The writer was in Jaipur at the invitation of M&M
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