Revival of Tata Nano: Can the World's Cheapest Car Maintain the Momentum?

In April 2011, the Tata Nano crossed the 10,000-mark in terms of sales. Its sales figure of 10,012 fetched it the 6 rank among passenger cars in India for the month as well as for the year till then. Analysts felt that this was a remarkable revival for the Nano as its sales figure had touched an all-time low just 6 months earlier - in November 2010. Achieving this turnaround was not easy. Analysts said that effective and attractive television advertisements, providing of additional protection in the exhaust system of the car to avoid fire incidents, incremental rise in sales points in smaller towns, extended free of cost warranty schemes, introduction of the 90%-financing plan through its in-house vehicle financing unit Tata Motor Finance, had build the turnaround possible. Since the Nano's launch in January 2008 at the Auto Expo, New Delhi, it had been a talking point in the automobile industry across the globe for its design, fuel and cost efficiency, and innovative ways of distribution.
Though its unique combination of lower innovative features had given it the title of 'wonder car' for the people, its rising prices had been slowly pushing it out of the reach of its real target customers. Experts noted that the Nano had been launched initially for middle class families riding unsafely on two-wheelers on Indian roads, but a continuous price rise was making it difficult for these families to migrate from bikes to the Nano.

A crack team led by R Ramakrishnan, Girish Wagh (Wagh) and VP (commercial-passenger cars), vice-president & head (small car project) was credited with orchestrating the revival of the Tata Nano. The team was keeping a close watch on the Nano's progress and was working to make sure that there was a constant focus on the target customer segment. Thus, analysts said they had a long and arduous road ahead in building and maintaining upon the sales momentum. In the future, other car manufacturing companies were also planning to launch their low cost variants in India. The challenge before the Nano's marketing team was how to counter those competitors and simultaneously attract the low-income customers.

Task 1 - Report

Write a report covering the task 1 using examples or scenarios given above wherever possible.

1 Describeany two elements of the marketing process

Choose any two from below:
• Understanding Markets- Analysis
• Corporate Strategy
• Marketing Programmes
• Marketing Strategy
• Implementation and control

2 Determine the benefits and the costs of the marketing orientation using example of Tata Nano [Guidance: you can describe the advantages and disadvantages of marketing orientation]

3 Identify (i.e.- list down) the macro (e.g. PEST) and micro environmental factors (e.g. all stakeholders) which influence marketing decisions

4 Show which segmentation criteria had been used in targeting Tata Nanao car in different markets

5 Choose any two targeting strategy for the Tata Nano car. [Guidance: you should consider any tow of the following strategies- undifferentiated strategy, differentiated strategy and concentrated Strategy]

6 Demonstrate how buyer behaviour affects marketing activities in different buying situation.

7 Recommend a new way of positioning the Tata Nano car

8 Give explanation on how products are developed to uphold competitive advantage during its life cycle

9 Describe how distribution is arranged to meet customer expectations

Task 2 - Presentation

You are expected to produce a presentation covering the task 2 (P10-P15). using MS Power Point slides and submit the printed copy of the slides. You are not required to present in front of any audience. However, your lecturer may ask you to give a presentation.

10 Explain how prices are set for Tata Nano to reflect Tata's objectives and market conditions prevailed in India.

11 Show how promotional activity is incorporated to achieve marketing objectives.

12 Analyse three of the extended marketing mix element. [Guidance: Explain people, process and physical evidence]

13 Plan marketing mixes for Tata Nano for two different segments in consumer markets

14 Explain the difference in marketing products and services in business rather than consumer

15 Show how and why international marketing differs from domestic marketing