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Honda banks on youth to power Jazz sales

MURALI GOPALAN | Updated on March 12, 2018

All that jazz: The third-generation Jazz premium hatchback - in production at the brand's Tapukara plant in Alwar, Rajasthan - has a lot going in its favour, believes Jnaneswar Sen, Senior VP, Honda Cars India. - Photo: RV MOORTHY

Jnaneswar Sen, Senior VP, Honda Cars India

Premium hatchback scheduled to debut in July

It may not have set the sales charts afire at the time of its launch in 2009 but things could be very different this time around for the Jazz.

“The market has since evolved and this is a youthful generation which wants the best and is willing to spend more. A lot has changed in India over the last six years,” says Jnaneswar Sen, Senior VP (Sales & Marketing) of Honda Cars India.

He believes this third-generation Jazz premium hatchback, scheduled to debut in July, has a lot going in its favour right from its style to quality and durability. And even while the Jazz of ’09 came with a comparatively high price tag of over ₹7 lakh, Sen maintains it was ahead of its times.

Price perfect

Pricing will be a lot more competitive for the new product given Honda’s aggressive focus on localisation and the growing role of India in its overall roadmap. The company believes youth power holds the key to fuelling sales of the car. As Sen says, the potential buyer base for the Jazz is not constrained by hierarchy and has high awareness levels. They could be single or married with enough disposable income going around.

“The Jazz will fulfil their emotional needs while assuring premium quality,” he adds. It is targeted at the 25-34 (years) age group which would be slightly younger than the buyer base of the City and Amaze. Honda carried out extensive market research over six months ago to get an idea of what people would want in the Jazz. This was an elaborate exercise which included almost every part of India including Tier 2 regions. “What came through clearly was that the mindset of the customer has changed dramatically over the years. Today, he/she has become more affluent and liberated,” says Sen.

The research also included visiting some of Honda’s Jazz buyers from 2009 onwards who are in their early 40s today. What was extremely reassuring was their satisfaction with the car, the strongest evidence of which is in the low number of used Jazz cars in the market.

Brand evolution

While the profile of the buyer has changed over the years, this is equally true for Honda’s own evolution in India. Since the time it launched the Jazz in ’09, the company has strengthened its portfolio of engines and cars. It now has the entry-level Amaze and, more importantly, a diesel engine option which has helped in its comeback strategy.

It was the absence of a diesel that was the biggest setback for Honda especially in ’12 when customers just gave petrol cars the cold shoulder. Where the Jazz of ’09 only had a petrol version, the new one will have diesel too as well an automatic (petrol) option. For the record, nearly 40 per cent of City and Amaze sales are taken up by the diesel versions which could be an important indicator for the Jazz.

Sen is also only too aware of the increasing shift to automatics largely propelled by Maruti-Suzuki’s Celerio and Alto models. Even in Honda’s case, the share of automatics has been rising over the last few years. It was barely five per cent with the second-generation City and grew nearly 13 per cent to the third. Today, the fourth-generation City has 20 per cent share of automatics in its customer portfolio and this behaviour pattern may well be replicated in the Jazz.

“People are spending more time on roads which makes automatics an attractive option,” says Sen. Also, there are a growing number of women professionals who prefer automatics.

Interestingly, the Brio hatchback may not be doing big numbers but its buyer base, like the Jazz, is largely youth-centric. It is here that the car will be an important source for future customers of the Jazz. The Brio also has a high percentage of women buyers and Honda would be hopeful that its users will eventually move to products within the brand’s portfolio.

This is why the Jazz becomes an important part of the product positioning exercise. The business pyramid begins with the Brio and goes on to the Jazz in the hatchback space. The next step is the sedan where the Amaze and City fill both ends of the entry and premium options. Finally, the Mobilio and CR-V do their bit in the utility-vehicle space. While the CR-V, Brio and Mobilio are produced at the Greater Noida plant, the Rajasthan facility is home to the Amaze, City and Jazz.

Published on May 07, 2015

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