2012 News Maker: Siddhartha Lal
Royal Enfield has worked single-mindedly and relentlessly on creating a holistic leisure motorcycle experience where the bike is also extremely practical in a daily context. And it has worked on improving the connect with its target audience.
Royal Enfield is one of India’s venerable bike brands but somehow got lost in the maze years ago. Over a decade ago, it was deep in the red and the conventional wisdom was to sell the brand. Way back then, the Enfield 350 cost about Rs 55,000, on-road, but the model range had several issues. It took ages to repair the bike, breakdowns were common, and no one vouched for the product's reliability. As Lal describes it, “Ten years ago, we were synonymous with the Bullet, which had a staid and agrarian feel about it."
All that is history now. Sales have risen five times and in the third quarter of this year, Royal Enfield has turned in remarkable results – production and sales of 30,046 bikes compared to 20,068 units YoY, a growth of 49.7 percent. Lal says it is the company's best quarterly sales performance.
This has taken a lot of time and investment. “Over the last decade,” Lal says, “we have worked single-mindedly and relentlessly on creating a holistic leisure motorcycle experience where the bike is also extremely practical in a daily context.”
Royal Enfield is now close to inaugurating its second facility in Tamil Nadu, which will have a capacity of 150,000 units. Lal says he always knew that the brand had potential. He also said, in a newspaper interview, that it helped that he was ‘naïve’. He did all the learning and now, the numbers are doing the talking.
Perhaps, one insight into how Lal has been so influenced by the bike can be seen in this extract from his blog on the RE website: 'A motorcycle journey is a great way to live your dream but in many ways it also takes you out of your comfort zone.'
The Royal Enfield range comprises six models beginning with the basic Bullet to the top-of-the-line Thunderbird 500. Today, RE bikes sell like hot cakes, and some models have a waiting list that extends from six months to a year. “The newer models have clearly attracted a younger urban demographic – which has fuelled our entire growth from 2,000 per month to over 10,000 per month now,” says Lal.
So what did Lal and the company do to turnaround the brand? Their strategy is manifold. One is the company’s connect with its target audience that it has worked on very steadfastly. The Himalayan Odyssey is one that has been around for almost a decade. Others include Rider Mania and REUnion. In addition, Lal says, "Riding is also promoted actively at our dealership levels. By the end of this year, we would have undertaken 600 rides across all dealerships."
On the technical front, the company invested in the design and validation capability and has been able to improve every aspect of the motorcycle – from ride and handling to electricals to engine and transmission. “A critical and visible point in this transformation was the introduction of our new Unit-Construction Engine platform on the Classic in 2009," says Lal.
He adds, “A huge change to our engine quality came with moving entirely to pressure die-cast aluminium parts and eliminating all manual operations in the machining of these parts; our battery of CNC machines and SPMs have allowed us to achieve extremely high tolerances in machining, ensuring better and more reliable functioning of the engine."
Lal admits that Royal Enfield has a long way to go. “We are firstly establishing ourselves as a true motorcycling company where everyone understands and appreciates the pleasure of riding,” he adds.
On a more personal note, Lal says,"The biker in me allows me to close my eyes and visualise what would make me truly delighted when I am riding. Conversely, when I am actually riding – especially on a road-trip – I can tune the entire world out and go into auto-pilot with the bike."
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