Why Atlas Cycle Failed- A brief case study
It was the year 1951 when a man with his dreams to provide quality bicycles to his countrymen set up his first 25-acre factory complex in a record period of 12 months .it was a modest beginning in an improvised tin shed at sonepat.
In the very first year of operation it rolled out 12000 atlas cycles out of the plant.
Soon it started looking to expand and send its first overseas consignment in 1958.by the end of the year 1965 atlas emerged as India's largest cycle manufacturer.
Awards and recognition :
Atlas was presented with the Ficci award for “Best Industrial Relations”. Italy’s Gold Mercury Award was conferred. It also received the prestigious EEPC Award for export excellence.
The honour of being appointed official supplier of bicycles to the IXth Asiad, at Delhi in 1982.
2014 onwards : everything was going fine but since 2014 the company started facing a financial crunch. Due to the loss the company closed its first plant of the atlas in december 2014.the losses continued to mar the operation and its growth and it resulted in financial crisis.
On world bicycle day factory closed its last operational plant. Statement was issued that the company has exhausted all its funds and it is not in the position to operate the factory.he added that due to no funds left company is unable to buy raw materials and hence by the time it does not raise the fund the plant will be non-operational.
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| After factory shuts down |
Factors responsible for downfall of the big giant :
Social media presence: If you look closely ,will be able to understand that the last advertisement which I can see on youtube was 2 years back.
Though most of the cycle companies have not updated them but this is one of the few reasons i am discussing was enough to amplify the problems.
Target market and positioning : again if you look closely at the ad - "do pahiye badlav ke', they mostly focused on old fashioned big bicycles.
Demographics of india : (2018 data)
0-14 years = 26.98%
15-24 years =17.79%
25-54 years =41.24%
55-64 years =7.60 %
Above 65 years =6.39%
So looking at the above age group,a huge chunk of population is below 55.Now mostly children under 15 years prefers cycling and most importantly Both men & women, particularly between the age of 25-40 years are taking to cycling like never before this shows that the huge chunk is lying in this range and again as india is growing and developing modernization and fashion is becoming the integral part of the culture.
Even though atlas had a huge range of products the way they endorsed and placed their product it was not up to the mark.
If you see the big players whether you talk about the hero cycles who roped arjun kapoor as their brand ambassador ,again a youth.
A classic example can be hrithik roshan koi mil gaya movie where he talked about avon cycle ,that was the classic example of product placement.
Though in 2005 atlas cycles signed suniel shetty and sania mirza but again it was a long back ago and since there was a huge change and shift in the industry and perception.
As per industry data, metropolitan cities like Delhi NCR, Mumbai, Bengaluru, Chennai, Kolkata, Pune and Hyderabad contribute to almost 55% of the total sales in the premium & super-premium segment. Now looking at this huge number you can't ignore the concept of brand placement. I personally believe this was one of the missed opportunity.
Online presence and website also plays an important role in creating brand awareness and in creating perception. If you look and try to compare it with other famous cycle company website -hero cycles ,you will be able to see differences.
Atlas has also categorized their products but the images are missing and it does not create a nice and friendly image.
conclusion
Atlas which introduced the first power brakes and was one of the innovative company which really fell behind in the race due to financial crunch,where it was unable to operate the factory but again I believe if it motivates and raises the fund it can come back in the race .
This articles shows the importance of right and dynamic marketing strategy and at the same time it shows importance of product placement and positioning of the product.
Motivation strategy and right placement of the strategy can really boost and can help it to bounce back.
Hence it was a brief analysis and this analysis was done on the basis of some of the marketing factors.their might be other financial factors but these were one of the most important factors where i try to draw attention and tried to put some light .
Hence again I am hoping the best for this firm and crossing my fingers wish it come back strongly with a dynamic team and conditions the management back .
All the best and for more updates you can keep following me.
thanks
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