New Delhi: Automotive firm Mahindra and Mahindra Ltd (M&M) is turning its dealerships across the country into farming advice centres in a bid to build its brand in the farming community and boost tractor sales.
“Our dealer mandate has been extended beyond just selling and servicing tractors,” said Sanjeev Goyle, senior vice-president of marketing at M&M, which became the first firm to sell more than 100,000 tractors in a year last fiscal.
Known as Mahindra Samriddhi Centres, the dealers have set up small farms to demonstrate the best farming techniques. The centres also conduct tests on soil samples for a fee of Rs50 and advise the cultivators on what nutrients to add to their soil.
Eighty centres have come up already, and the company plans to raise their number to 250 by the end of next year.
It has also set up a website in several regional languages to provide information on diverse topics such as use of fertilizers, location of cold storages and mechanization centres.
“Mahindra is the first tractor company to start these rural brand-building initiatives,” said Priya Monga, business head, RC&M Pvt. Ltd, an experiential marketing company that has worked on several rural marketing campaigns. “It’s highly possible that its competitors would follow suit.”
Goyle said, “We are leaders but we also need to be thought leaders in the industry.”
India’s tractor industry grew 40% last year to 400,000 units. M&M, India’s largest tractor firm along with Punjab Tractors Ltd, which it acquired in 2007, has a 42% market share. It sold 160,000 units last fiscal. Punjab Tractors, which still sells under the Swaraj brand, makes up 12% of sales. M&M is silent about sales targets this fiscal.
In the past, other automotive manufacturers selling in rural India have also undertaken brand-building exercises.
Maruti Suzuki India Ltd and Hero Honda Motors Ltd have dedicated rural marketing teams that also work on brand-building. Sugar maker DCM Shriram Consolidated Ltd has set up supermarkets that help extend its brand in rural India.
A good monsoon this year, which Goyle describes as “a catalyst” for purchases, will help M&M increase its sales. Increased infrastructure spending and higher procurement prices for farmers could also boost sales.
Tractors are also rented out to contractors to be used for haulage and transport activities. With 80-85% of tractors being sold on credit, easier credit availability will also add to sales.