Maruti is finally firming up plans to launch its True Value business in India. And naturally the first step in that direction is aligning the business with an agency. agencyfaqs! has learnt from industry sources that Saatchi & Saatchi and Capital Advertising are vying for Maruti's True Value business, which is estimated at Rs 2 crore. It appears that so far Maruti has briefed these two agencies and the pitch is yet to take place. Next week the two agencies are expected to make a strategy-cum-creative presentation.
The brief is simple: to make Maruti a one-stop auto-shop for people. In other words, to convey the message that it fulfils all auto-related needs under one roof. And that is what True Value is all about. It is Maruti's venture into four auto services - finance, insurance, pre-owned cars (second hand car market) and leasing and fleet management to ensure a hassle-free relationship between the Maruti car owner and his/her car. Diversifying into these four sectors can be seen as a logical step by the company to grow its business at a time when the auto industry in India seems to have hit a roadblock. The company itself faced a tough time last year and closed its books with an 11 per cent drop in total sales over the previous year.
"The second-hand car market," observes Murad Ali Baig, motoring and travel writer "which is still unorganised will become as competitive as the first-hand market with serious efforts from Ford India, Toyota and now Maruti." In any case, Maruti stands at a clear advantage vis-à-vis other players by virtue of being the oldest player in the market. Market estimates show that about 70 per cent of the total number of cars - first-hand or otherwise - plying on roads belongs to the company. So now, it's only a question of getting its act together and grabbing the initiative.
And that's what it plans to do. Henceforth, all the used cars will have the True Value stamp verifying that the inspection procedure is complete and the car is for sale. However, unlike Ford, Maruti is only looking at reconditioning Maruti cars to begin with.
With regard to financing cars, while Maruti has worked out the broad strategy framework, it is giving finishing touches to the nitty-gritty of the business. Basically, the company plans to take on the role of an interface between the customers and the finance companies. All the paper work will be done under the True Value brand name but finally the business will go to the finance company the customer has opted for.
The company is ready to address insurance-related issues as well. Claiming insurance is a cumbersome process otherwise and it takes four to six months to claim the damages. If Maruti has its way, it will hopefully put an end to the miseries of many. Henceforth, every Maruti car owner would be given a plastic/magnetic card that will have all the information on the insurance policy. In case of an accident or theft all that the car owner has to do is go to the nearest Maruti dealer and hand over the card. The dealer will swipe it and the information will be stored in the main database. The car will be repaired immediately in case of an accident.
All this is certainly good news for Maruti car owners - current and prospective - but for the two agencies vying for the account, it's a few more anxious days before the company makes up its mind.
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