Honda was one of India's most popular car brands for 25 years
Until Kia entered in 2019 and changed the game in just 3 years
Since day 1, Kia has been breaking Honda piece by piece by selling more cars than them
Here's how the amateur knocked out the pro:
Until Kia entered in 2019 and changed the game in just 3 years
Since day 1, Kia has been breaking Honda piece by piece by selling more cars than them
Here's how the amateur knocked out the pro:
Before Kia entered India, it took its time to research the market and demand here, and figured out certain gaps that Honda and others missed.
They understood that in India, you have to master 2 things:
• Visible over-delivering
• Perfect pricing
They understood that in India, you have to master 2 things:
• Visible over-delivering
• Perfect pricing
Visible over-delivering is when you give a lot more things that people can easily understand.
Basically — package so many things inside your product — that it seems like you’re overdelivering.
Indians tend to pay more attention to bundle packages and eye-pleasers.
Basically — package so many things inside your product — that it seems like you’re overdelivering.
Indians tend to pay more attention to bundle packages and eye-pleasers.
These raise the perceived value of the product, not the real value.
Real substance like quality engineering is the primary thing you want from a car.
Even if you compromise on that (to get the price right), but deliver on the perceived value & price, you can win in this market.
Real substance like quality engineering is the primary thing you want from a car.
Even if you compromise on that (to get the price right), but deliver on the perceived value & price, you can win in this market.
That’s exactly what Kia did.
On the other hand, Honda has always focused on quality engineering and reliability.
They want to get the product right, and don’t compromise on the time it might take to build it.
That’s why they are late to deliver in a fast moving Indian market.
On the other hand, Honda has always focused on quality engineering and reliability.
They want to get the product right, and don’t compromise on the time it might take to build it.
That’s why they are late to deliver in a fast moving Indian market.
For example, they introduced their diesel engine so late that there wasn’t a significant difference in the price of the diesel and petrol by then.
Turns out, all that hard work made no difference in customer’s life.
Turns out, all that hard work made no difference in customer’s life.
Right from the start, Honda has been a premium brand which targeted a slightly aspirational segment
— people from the upper-middle class who wanted a really good car.
The Honda City was a hit in this segment and Honda became the king of sedans.
— people from the upper-middle class who wanted a really good car.
The Honda City was a hit in this segment and Honda became the king of sedans.
They used to say that Honda India is a perfect ecosystem.
The product was so good, that you just couldn’t leave the Honda ecosystem.
If you had a City, you upgraded to a premium sedan Civic.
If you had a Civic you upgraded to a luxury sedan, Accord.
The product was so good, that you just couldn’t leave the Honda ecosystem.
If you had a City, you upgraded to a premium sedan Civic.
If you had a Civic you upgraded to a luxury sedan, Accord.
But now, the Indian market has changed completely.
If you own a sedan, instead of a premium sedan, you’d rather upgrade to a SUV crossover.
But unfortunately, Honda has no such options.
It did have C-RV back in its glory days, but that was, again, kinda luxury crossover.
If you own a sedan, instead of a premium sedan, you’d rather upgrade to a SUV crossover.
But unfortunately, Honda has no such options.
It did have C-RV back in its glory days, but that was, again, kinda luxury crossover.
Premium sedans aren’t able to attract the bulk of Indian masses anymore.
When at the price of premium sedans, people can afford a complete spacious SUV, why would they go for it?
When you can afford a Fortuner, why would you go for an Accord at the same price?
When at the price of premium sedans, people can afford a complete spacious SUV, why would they go for it?
When you can afford a Fortuner, why would you go for an Accord at the same price?
Of course, some people just love sedans, but this is mass market behaviour we’re dealing with here.
This teaches us that having a superior product with the best quality is not enough.
Its timing has to be right, and so does its positioning.
This teaches us that having a superior product with the best quality is not enough.
Its timing has to be right, and so does its positioning.
Kia has been nailing this!
People need an SUV? We’ll give them an SUV.
People need SUVs at a great deal, we might cut down on the quality a little, but match that price.
People need an SUV? We’ll give them an SUV.
People need SUVs at a great deal, we might cut down on the quality a little, but match that price.
Most normal people won’t understand the specifics of engineering that goes into making really good reliable cars.
What they understand is the language of features and gadgets that will be of use to them daily.
What they understand is the language of features and gadgets that will be of use to them daily.
Kia does really well with a lot of in-car electronic features that come with high-end cars, and get them to you at a much lower price.
Essentially disrupting the segment.
Essentially disrupting the segment.
Just see the difference in the safety ratings of Kia VS Honda.
People in general would prefer price and features over safety.
People in general would prefer price and features over safety.
Kia never wants to launch a hatchback in India.
It learnt from Honda’s mistake with Jazz.
Jazz might have sold some cars, but in reality, it sold Honda’s premiumness short.
Who wouldn’t buy an affordable car from a premium car company?
That’s how Honda thought about it.
It learnt from Honda’s mistake with Jazz.
Jazz might have sold some cars, but in reality, it sold Honda’s premiumness short.
Who wouldn’t buy an affordable car from a premium car company?
That’s how Honda thought about it.
But if you think about it, who would want to buy a luxury car from a car company that is pivoting for the masses?
While trying to democratise its offering, Honda diluted its brand value and lost its exclusivity.
While trying to democratise its offering, Honda diluted its brand value and lost its exclusivity.
And the Jazz or Brio didn’t even sell that well because they were expensive hatchbacks.
People would prefer sedans over such cars.
That’s why Honda’s Amaze was a perfect positioning in the market.
Amaze is the one saving Honda from going under along with the Honda City.
People would prefer sedans over such cars.
That’s why Honda’s Amaze was a perfect positioning in the market.
Amaze is the one saving Honda from going under along with the Honda City.
No other company in India in this segment is trying to deliver the quality Honda is delivering.
It’s only a matter of right choices and timing, and they can make a solid comeback.
And being Honda lovers ourselves, we think they will.
It’s only a matter of right choices and timing, and they can make a solid comeback.
And being Honda lovers ourselves, we think they will.
If you liked this read do ReTweet🔄 the 1st tweet
and follow us @FinFloww for such threads every Monday, Wednesday and Friday!
and follow us @FinFloww for such threads every Monday, Wednesday and Friday!
Join 13202 people who receive such stories daily on their WhatsApp:
chat.whatsapp.com
chat.whatsapp.com
Join the 5281 people who read our email newsletter every Sunday:
FinFloww.substack.com
FinFloww.substack.com
Loading suggestions...