Bajaj gears up to create mindshare for Discover

When Rajiv Bajaj says he does not believe in the strategy of familiarity, he pretty much means it. This is why the Managing Director of Bajaj Auto insists the company will not enter the scooter space even if it means being part of a fast growing product segment.

To critics, this strategy just does not add up especially when the company is losing market share in the commuter segment with its Discover. On the other hand, Hero MotoCorp’s Splendor and Passion motorcycles as well as Honda’s Activa scooter are doing roaring business.

“Our strategy is one of differentiation and I believe in the Discover brand,” Bajaj told Business Line. While Hero is the clear market leader, Honda and Bajaj Auto are “worthy challengers”. The difference, according to him, is that Honda has followed a strategy of familiarity vis-à-vis Hero for its bikes.

As a result, Bajaj adds, the Japanese automaker seems to be in tandem with its former ally both in product and marketing. “What I can infer is that the strategy is perhaps based on the assumption that customers will buy the Honda brand,” he says. The Splendor and Passion, though, continue to do brisk business and have not faced any serious threat yet from the Dream series (Yuga and Neo).

But then the strategy of differentiation has not helped the cause of the Discover either in the leadership stakes, I tell him. In reply, Bajaj takes a quick detour to the more successful Pulsar brand. He reminds me that when the company launched the bike in 2001, it was the 180cc option which was positioned as the top-of-recall model as a deliberate move to get mindshare.

Today, this is true for the 200 and 220cc Pulsars even though it is the 150cc that accounts for 80 per cent of sales. “Mindshare must come first and market share will follow,” Bajaj says.

So, is this where there was a goof-up with the Discover? The brand made its debut a decade ago with the 125cc and was in sync with the company’s strategy of differentiation. “However, any idea needs to be implemented and perhaps the execution was wrong,” he says. Today, the new Discover 100 and 125 are averaging about 70,000 units per month. “This means that my mindshare has to be twice as strong,” reasons Bajaj. In the process, the logic convinces him that the company is right about steering clear of scooters. “If I cannot get the Discover right after 10 years, how can I get something right when starting from scratch?” he counters.

This is where Bajaj believes the new Discover 150, due to be launched by the end of this month, could make a significant change in the mindshare space. “My task is to have a strong new product and the Discover 150 will hopefully do the trick in establishing a strong customer contact,” he says.

This is a completely new bike and will be the first 150cc in the commuter segment. Bajaj had followed a similar route in 2010 when it launched a 150cc Discover but the difference this time around is that is a completely new bike and not the same model with a more powerful engine.

The biggest challenge is drawing customers given that 80 per cent of buyers in the commuter market follow the conventional route of buying a 100cc bike. In effect, says Bajaj, the strategy should revolve around targeting the balance 20 per cent for the new Discover 150.

“Experience tells me that the early adopters are critical and I need to look for those guys who want to be different. In this universe of six lakh commuter bikes each month, even five per cent (of early adopters) mean 30,000 units each month,” he says.

According to Bajaj, a clearer idea of the buying pattern for the new Discover will emerge in October when these daring and unconventional buyers have their bikes out on the road. This is when the more conventional category gets to see them and numbers will gradually grow thereon.

From his point of view, even if monthly sales of the Discover 150 are about 70,000 bikes at best eventually, it will play a critical role in lifting the brand. And this is where the mindshare void for the Discover will hopefully be resolved.

Bajaj says it’s time critics who carp about market share acknowledge the company as a global player whose interests go beyond India.

He cites Africa as a case in point where the company is the market leader in regions like Nigeria, Uganda and Angola with the Boxer 100 and 150. “We have done this successfully without too much of a song and dance while sitting thousands of miles away. This is what competition is all about,” Bajaj says.

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