Royal Enfield - a market leader in its true sense

Royal Enfield is a motorcycle brand known for its sheer ruggedness and its rich history. Every brand has loyal customers and fans. But one would say customers of Royal Enfield are "Superfans". Being a proud new owner of a Royal Enfield motorcycle, it made me think how they are able to sustain their place in the market without any traditional promotions nor do they promote themselves extensively compared to competitors taking them on. Remember the Bajaj Dominar 400 “Haathi mat paalo” ad?

So how is it that Royal Enfield has been able to do it continuously, being one of the oldest motorcycle brands around the world. RE is an Indian company with British origins. RE falls under the luxury segment of motorcycles and has become a status symbol for people. RE, though it seems to have been a great success since the year 1906, facts don’t tell the same story. Around 17 years ago, the stock price for Eicher Motors was Rs. 48.75. This was in the year 2000. The stock price today is around Rs. 31,320 which accounts a 64,146 percent of a skyrocketing boost. A company which was on the verge of closure stands in its own glory with "Superfans" all around the world in around 50 countries. It all comes to Mr. Siddharth Lal, the MD and CEO of Eicher Motors. His love for Enfield is what has brought RE to this position. In 2004, he had to take a huge decision. Eicher motors had 15 other products including tractors, trucks, garments and footwear. But none of these were even close to being a market leader. He decided to divest all 13 businesses and invested all the money on Royal Enfield motorcycles and trucks two products where he felt they had a chance to be leaders in the market. A decade later, Eicher Motors earned a revenue of Rs. 8,736 crores and 80% of these profits were from RE motorcycles.

Royal Enfield being the market leader among heavy luxury motorcycles brands in India, they have their own way of promoting their brand. Events that make superfans exhibit and talk about their bikes, the alterations made and not to forget the campaigns conducted through week long rides from places down south in India to the Himalayas. A lot of such campaigns keep happening and this speaks of the ruggedness of the vehicle. They do not have to worry about competitors taking them on through television ads and other means as their target is so specific that they are able to communicate through the superfans and are not pushing the brand to people. Loyalty is something that they have achieved from customers through a brilliant set of marketing mix. They now have their garments section in their RE showrooms and people would love to flaunt them. It has been indeed a royal success for Eicher Motors and the decision taken by Mr. Lal has proven to be a great one.

Now that Harley Davidson has announced its entry into the Indian market with 250cc and 400cc engine bikes to take on RE, I am sure they are looking at it and will have to wait and watch the competition unfold in the market, the strategies that they will use to hold their leader position and we might even see some ads coming up.