New Delhi: After parting ways with Honda Motor Co. Ltd, two-wheeler maker Hero MotoCorp. Ltd—formerly Hero Honda—is ready with an ambitious growth plan. On the anvil are new launches in India and an export push. Anil Dua, vice-president (marketing and sales), spoke in an interview about the company’s strategy. Edited excerpts:
Will you produce a motorcycle developed by Hero before the agreement with Honda expires in 2014?
We are investing in our own R&D (research and development) and we are definitely working towards introducing our own bikes. We have said that we will be launching seven-eight models every year, whether they come from our own technology or from tie-ups across the globe or from support of Honda. From all these three sources, we will ensure fresh models in the market. We will look to bring our own motorcycle in this period.
What is happening on the technology front?
The first step in our strategic shift is establishing our brand—that we have started well. The second step would be bringing in new products. We will be introducing Impulse and Maestro scooters in this calendar year and these will be followed by more products next year. The third step is related to technology tie-up. There are two aspects to that—strengthening our own R&D, investing in our own facilities, equipment, recruiting people and building our own capabilities within Hero MotoCorp. The other aspect is the technology partners around the globe. We have already tied up with experts in Japan and Europe. Going forward, we are looking at some more tie-ups. These are groups of people who are very knowledgeable in technology and design. They are working very closely with us. We have been approached by various technology companies across the globe who want to do business with us. We are evaluating all these proposals and if we feel any of these tie-ups goes well with our long-term plans, then certainly we will look at them far more closely.
What kind of model are you looking to adopt overseas?
Currently, we are looking at Latin America, Africa and South-East Asia as three potential markets where we can get some good international business. We will be exporting to these markets. In course of time, as the volumes justify and there are local benefits of doing that, we may look into manufacturing overseas. We have said that the international business will account for 10% of our total business in five-six years. So, that means international business and not merely exports.
Beyond borders: Anil Dua says a new organization will come into place to take forward the company’s overseas business. Photo Harikrishna Katragadda/Mint
Will there be a change in the marketing and management model overseas?
We have put together a cross-functional team that is studying the international business. This team has members from finance, marketing, HR (human resources) and IT (information technology). So, they will also be looking at the organization structure that is required to carry forward the international business. It is fair to assume that as you go forward you want to build a business which is 10% of $10 billion business ($10 billion is the overall revenue the company is targeting by 2017). So, certainly, there will be a new organization that will come into place to take forward the business.
What’s the thinking behind the new Hero anthem?
See, we had a very exciting task of taking a brand forward, which was 27 years old, and building on its legacy. Thankfully, we had no baggage to shed but a legacy to build and we had opportunities to embrace. So, we wanted to build a brand, which does justice to these requirements. If you look at what we have built now, it symbolizes that kind of continuity, while announcing a big change, because the word Hero is like continuing from the past, yet it is different.
The “H” emblem, which was with Hero, is also marking a radical change from the past, while its colour red and black also signals continuity with the past. So, the underlining theme really, here, has been signal continuity with change.
It was talking to a very youthful audience and it was engaging with them in a very dynamic way. Therefore, the positioning of Hum Mein Hai Hero is actually trying to leverage that. We think that this campaign has universal appeal and builds on the strength of the brand and it’s very engaging with customers.