‘Engaging with customers, not flashy advertisement, creates a brand’
The Royal Enfield made headlines with an elaborate showcasing of its first twincylinder engine bikes–Continental GT 650 and Interceptor INT 650—at Eicma 2017 motor show in Milan and during the 14th edition of Ridermania, its annual gathering of Bullet enthusiast, earlier this month. In an exclusive conversation with The Sunday Guardian, Siddhartha Lal, Managing Director and CEO, Eicher Motors, talks about the company’s journey from its lean period in 2000 to the current dream run.
Excerpts: Q. Royal Enfield had several high points this year and is going from strength to strength, year after year. However, this was not the case back in 2000 when the company was almost on the verge of shutting down. How did you regain popularity and became the market leader in mid-size motorcycle segment? A. Around 17 years ago when I started running the company, it was running in losses. The company was also facing relevance issues with the young people at that time and perhaps the built quality as well. How- ever, even then it had a devoted customer base. During our first Ridermania in 2002-2003 and Himalayan Odyssey, we saw that people were gravitating towards the brand. All we had to do was do the right things and go in a right direction.
Between 2004 and 2010, although we were growing much slower than other companies in the industry, we were making progress. Our qualitative aspects were improving, including our distribution, and services. We also made the decision to switch to unit construction engines (UCE) from our iconic cast-iron engine. And with the launch of Royal Enfield Classic 350cc that came with the new UCE engine we started seeing increased demand. It took us a couple of years to manage that growth and once we accomplished that we started to aspire to be global leader in mid-size motorcycle segment. With that in mind, the ideas of Continental GT 650 and Interceptor INT 650 were conceived. Q. What was that one tipping point that turned around the tables for Royal Enfield? A. I think the decision to sell off 13 out of 15 businesses that we were dealing in 2000 and focusing only on trucks and Royal Enfield could be considered as a tipping point. Conventional wisdom says not to disturb the apple-cart. But I wanted to do one thing and do it really well rather than doing multiple things and be mediocre. And for me it wasn’t about financial results. I wanted to build a strong position and have a good time doing it. Q. Apart from the robust growth in sales year-on-year, your apparel and motorcycle accessories business is also doing extremely well among Enfield riders and non-riders alike. And much of the credit goes to the strong legacy and a sense of identity that the brand has managed to build. How did you manage to build such iconic brand value? A. We have always stood for the experience over just the product. Engaging with the customers creates a brand and not some flashy advertisement. We ventured into motorcycle accessories segment because our riders wanted quality biking gears that are accessible. Also, the idea was to enhance the overall retail experience to make it much more accessible. We want to make our retail units a place where people can come and explore the world of Enfield without any pressure of buying the bike. With this idea in mind we have launched Goa Garage Cafe as well so that people can come, have a good time and learn about Royal Enfield and it’s history. Q. The government has announced its intent to turn 100% vehicles electric by 2030. How is Royal Enfield gearing up for such a switch in urban mobility, while sustaining brands trademark image? A. We are a building a plan on how Royal Enfield’s persona and idea can translate into electric mobility. We don’t plan to be the first in the market with electric vehicles. We want to do it in a very different way by understanding the entire ecosystem. We have strong capacities to fit into the changed ecosystem and still retain the brand’s distinct image.