5th TRIMESTER PROJECT ON

Tata Motors launched their low cost car „Nano‟ with lot of fanfare and very little traditional advertising

Submitted by:-

Ritesh Pahuja
D1012SSISBE-A10272(IND-7A-IA-1053) SPRING SUMMER 2010-2012 E-mail:- pahuja.ritesh@rediffmail.com Mob: - +91 8800988808 /+91 9890733355
Date of submission :-11/july/2012

Subject:Advertisement SEC:SP-4

Submitted To: IIPM Examination Department NEW DELHI

IN PARTIAL FULFILLMENT OF REQUIREMENT FOR MASTER OF BUSINESS ADMINISTRATION

INDIAN INSTITUTE OF PLANNING & MANAGEMENT NEW DELHI

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Content:-

1. 2. 3. 4.

Literature Review. Conception. Tata Nano intro. Controversies

5. The Release Of the “TATA NANO” 6. The “NANO” EFFECT

7. Tata Nano - Strategy, Impact on the Automobile Industry 8. Promotion Strategies :a) Objectives of Promotion Strategies b) Promotion Tag line c) Advertising Program d) Online Advertisement e) Promotion Flow 9.

Evolution:a) Communication strategy b) Internet marketing program implementation c) Online buzz d) Social media communities e) Sms marketing f) Trade shows g) Program launch

10 . Conclusion. 11 . Bibliography

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information search. customer relationship. How a consumer‘s attitude. we considered a number of internal factors that influence consumer behavior including perception.LITERATURE REVIEW The purpose of this study is to gain a better understanding of factors that influence consumer buying behavior in cars just because of advertisement. Examined the stages of the consumer decision-making process for buying a car: problem recognition. The personal influences on consumers are important determinants of their needs and wants. Specifically. motivation and learning. or issue. family status. evaluation of alternatives between different brands of cars. can affect what they buy also examined. factors associated with relative importance and perceived consequences of the purchase. 3 . Reviewed other factors that influence consumer purchasing decisions and buying behavior including personal. social. which is a lasting evaluation of a person. and situational issues. object. Also addressed the impact of the amount of effort expended and of perceived risk. and chosen lifestyle are strongly related to the types of products people buy and the specific brands they select. from the consumer‘s perspective. income. and resale value of the car. Such factors as age. product choice and post purchase evaluation with respect to after sales service.

The car is expected to be produced in the Singur plant in West Bengal.000 units per year 4 . the Maruti 800. inspired by the number of Indian families with two-wheeled rather than four-wheeled transport."  To achieve its design parameters. The deluxe version will have air conditioning. including one standard and two deluxe variants. The car was designed at Italy's Institute of Development in Automotive Engineering — with Ratan Tata requesting certain changes. but no power steering. Ratan Tata. "It is not a car with plastic curtains or no roof — it's a real car. The Nano's development has been tempered by the company's success in producing the low cost 4 wheeled Ace truck in May 2005. when compared with its closest rival. The Times of India reported the vehicle is "a properly designed and built car". which is under construction.  Contrary to speculation that the car might be a simple four-wheeled auto rickshaw.Conception  The project to create the world's most inexpensive car began in 2003. The initial production target set by Tata Motors is 250. such the elimination of one of two windscreen wipers. emphasized innovation and sought new design approaches from suppliers. Tata has refined the manufacturing process.  The Nano has 21% more interior space and an 8% smaller exterior. The car will come in different versions. under the Chairman of Tata Motors. The Chairman is reported to have said.

2008 at Pragati Maidan in New Delhi.1 in) The Tata Nano is a proposed city car first presented by India's Tata Motors at the 9th annual Auto Expo on January 10. Pantnagar & Pune None City car 4-door kei car RR layout 2 cylinder petrol Bosch multi-point fuel injection (single injector) all aluminium 623 cc (38 cu in) 4 speed synchromesh with overdrive in 4th 2. 5 .230 mm (87.8 in) 3100 mm (122 in) 1500 mm (59. India.TATA NANO Manufacturer Parent company Also called Production Assembly Predecessor Class Body style(s) Layout Engine(s) Transmission(s) Wheelbase Length Width Tata Motors Tata Sons The People's Car 2008 — present Singur.

Rear mounted engine The use of a rear mounted engine to help maximize interior space makes the Nano similar to the original Fiat 500. meaning dwarf — as with nanometre. raising the price of the car. The Wall Street Journal confirms a global trend toward small cars. rear-engined. Newsweek identified the Nano as a part of a "new breed of 21st-century cars" that embody "a contrarian philosophy of smaller. "Nano" also means "small" in Gujarati. also with rear engined 6 .000 rupees or approximately $2300 US despite rapidly rising material prices. four-passenger car aimed primarily at the Indian market. lighter. another technically innovative "people's car". which includes the Nano. or foregoing profit on the car — the latter an unlikely proposition. founders of the Tata Group. Pricing Strategy Tata initially targeted the vehicle as "the least expensive production car in the world" aiming for a starting price of 100. the Nano is projected to be a small.While currently undergoing final development. A concept vehicle similar in styling to the Nano.. cheaper" and portend a new era in inexpensive personal transportation — and potentially. 2008 material costs have risen from 13% to 23% over the car‘s development. The prefix "Nano" derives from the Greek root 'nanos'. As of August. the native language of the Tata family. while an increased price on the Nano will likely decrease demand. "global gridlock". affordable. and Tata now faces the choice of introducing the car with an artificially low introductory price.

7 mpg (US). The head of Tata Motors' Engineering Research Centre. the Nano is a 33 PS (33 hp/24 kW) car with a 623 cc rear engine and rear wheel drive. 73.55 L/100 km (21. The eventual new Mini was much larger and technically conservative. It is the first time a two-cylinder non-opposed petrol engine will be used in a car with a single balancer shaft.3 mpg (UK)). Girish Wagh has been credited with being one of the brains behind Nano's design.1 mpg (US). 51. 7 .97 km/L.97 km/L. and has a fuel economy of 4. 62 mpg (UK)) under city road conditions. and 3. 61. MG Rover Group later based their Rover CityRover on the Tata Indica.layout was proposed by the UK Rover Group in the 1990s to succeed the original Mini but was not put into production. Tata is also reported to be contemplating offering a compressed air engine as an option. Tata Motors has reportedly filed 34 patents related to the innovations in the design of Nano. Technical specifications According to Tata Group's Chairman Ratan Tata.85 L/100 km on highways (25. with power train accounting for over half of them. The independent. and now-defunct.

15.000 peasants and agricultural workers. Ratan tata has conceived a scheme to only offer the Nano to those individuals who do not have an automobile already. Singur car factory land dispute Controversies also arose about Tata‘s planned manufacturing unit for the car in Singur. Die Welt reports that the car conforms with environmental protection. The construction of the car factory on that tract of land will require fertile agricultural land and the expropriation and eviction of ca. and that developing countries shouldn‘t be denied the right to motorized mobility when industrialized countries should be looking to reduce their emissions and usage of cars. environmentalists are concerned that its extraordinarily low price might lead to mass motorization in countries like India and therefore aggravate pollution and global warming.Controversies Mass motorization and climate change As the Nano was conceived and designed around introducing the automobile to a sector of the population who are currently using eco-friendly bicycles and motorcycles. West Bengal. where the regional government of West Bengal has allocated 997 acres (4. and will have the lowest emissions in India. In crowded metropolitan cities like Mumbai. an Indian and chair of the Intergovernmental Panel on Climate Change. said he was ―having nightmares‖ because of this car and added that the car represents bankruptcy of India‘s environmental policy. The ecology focused German newspaper die tageszeitung feels that such concerns are ―inappropriate‖ as the Tata Nano has lower emissions compared to the average Volkswagen. Rajendra Pachauri. 8 .03 km²) to Tata Motors. The affected farmers fear they will receive inadequate or no compensation and therefore lose their livelihoods.

In New Delhi. ―The Rs 1 lakh car has Singur people‘s blood on it. women protested wearing T-shirts bearing slogans that said. where Tata‘s manufacturing unit is located.Activists near Kolkata.‖ The Trinamool Congress alleged that Tata motors usurped the agrarian land for the construction site and have threatened to stall the manufacture of the car 9 . started burning the car in effigy.

Research and Advocacy at the Centre for Science and Environment. The projections for economically booming countries like China and India reveal a two-digit percentage growth of car sales for the upcoming decades. The Nano. the cheapest car worldwide. assuming that China is likely to outrun the United States and become the largest automotive market worldwide by approximately 2020. brought about a great enthusiasm about the Indian car market but at the same time caused outcries of environmentalists arguing that with its launch the emission would dramatically increase and the already overloaded streets in urban India would be even more congested and polluted. individualistic mode of transportation characteristic to modern society. 2. The concept of ―automobility‖ originating from the Greek term ―auto‖ for self puts emphasis on the self-determined. Anumita Roychowdhury. With regard to the launch of the Nano. especially in countries which can only partially provide convenient public transport.THE RELEASE OF THE TATA NANO 1. 10 . with its price of around Rs 1 Lakh (~1800 Euro). 3. has become a symbol for personal freedom. comments on the Nano and the current transport situation in India‘s cities from an environmentalist point of view. The individual ownership of cars. working as Associate Director. a long term partner organization to the Heinrich Böll Foundation. This concept is increasingly spreading among the world. status and economic success. entering on fast track into the upcoming newly industrialized countries. In this context the release of the Tata Nano at the Auto Expo in Delhi/India on the 9th of January 2008 resulted in an international and national uproar and conflicting responses.

Tata Motors has filed over 34 patents for the car.THE “NANO” EFFECT  Nano. In particular. On the technology front. Others have argued the Nano will democratise car ownership.000 units. the new low cost car unveiled by Tata Motors at the Auto India Expo at Delhi last month. 11 . electric windows and power steering) after registration. Mr. an event as significant as the launch of the Model T by Henry Ford. and even a happening that may upturn the brahminical order in the country. his wife seated behind him holding a little baby. the round figure of Rs100. There has been considerable hype surrounding the car. a great deal of innovation has gone into the drive train and its placement and half the patents filed pertain to the drive train alone.‖ The Nano is expected to hit the roads in late October this year at the time of the festival of Diwali.  The on-road price of the basic model (with manual transmission and without air-conditioning. however the company may have to relocate production to other locations. his young kid standing in front of him. Thus. has set the country abuzz. Some commentators have declared the advent of this car as a transportation revolution. the Nano certainly epitomises India‘s progress in innovation. Given the ongoing local unrest. One of the key patents is the introduction of a balancer shaft to iron out the vibrations typical for a twin-cylinder engine.000(++) is symbolic and the price tag is ostensibly meant to get India‘s two-wheeler segment into motorcars. packed as it is with several firsts. ―the father (riding) the scooter. taxes and insurance will be around Rs125. If this were to happen there could be a delay in the delivery schedule.000 whereas the deluxe models will cost around Rs150. It will be manufactured at the Tata Motors plant at Singur in West Bengal with an annual production capacity of 250.000. Ratan Tata is quoted as having said he was motivated to develop an inexpensive car when he saw.

merits of the case aside.5 percent. Auto sales in India almost doubled in five years from about 5. Thus. there is no sign of this abating. Over the same period. 12 .11 million units in 2006-07 During the last financial year (2006-07) alone. sales of two-wheelers went up by about 11. sales of passenger cars grew at a scorching rate of 22 percent. it is evident that the country is rapidly motorising. And with incomes rising in an economy growing at a rate of eight percent or more annually.23 million units in 2001-02 to 10. This brief focuses on the economics of owning and operating a Nano and its impact on automobilisation in the country.  The implication of the impending advent of an inexpensive passenger car such as the Nano on urban transport in India has to be seen in the context of overall trends in motorisation in the country. Issues related to impact on air quality and congestion are addressed in a companion ISAS brief.

Impact on the Automobile Industry Cost Management and Strategy used The great wonder car by Tata‘s has stunned the entire world. For proprietary design components. Much of India's low-cost production edge comes from cheap labor and a large part of the low-cost assembly in factories and plants is done through manual operations. and taking advantage of India‘s low production costs. particularly steel. has a smaller and lighter engine than other cars.Strategy. Nearly everything has been sourced locally and the Nano boasts of greater than 95% of content sourced locally since day 1. 13 . Tata‘s suppliers were an integral part of the design and development process. However this situation is changing fast with companies wanting to increase productivity by automating their lines. smaller tube-less tyres and a basic interior. Tata divided the components into two types – proprietary designs and Tata Motors design. Tata not only worked on its own processes but also helped its vendors innovate. Because of its size. Since then it has been in lime light and has been making news in the auto sector throughout the world. Tata Motors chose suppliers with strong process capabilities who could give valuable suggestions and improvements in the designs.Tata Nano . Tata cut costs by minimizing components. For components and systems designed in-house. Tata went with established suppliers who then worked on the development from Indian technology centers hence saving further cost. The cost associated with employing engineers in international development centers was a costly affair which made Tata‘s use local design capabilities. it requires less metal. Critics who often said that it was not possible to make a car at a price below $3000 were taken to a back sit when Ratan Tata the chairman of Tata Motors unveiled this car in New Delhi at a price of $2500.

. driving down the costs even further. 14 .. A three-shift operation and consolidated purchasing with.Instead of annual contracts. Tata went with long term volume contracts with its suppliers.

whichever comes first. So first of 15 .000km warranty. they feel fresh with this new brand and concept of this car. we need to very clear about what are the objectives we need to achieve. Tata Nano is very new for Malaysian. including all the features described in the earlier Product Review section. Branding is endowing products and services with the power of a brand. PROMOTION STRATEGIES Objectives of Promotion Strategies Before determine the promotion strategies. We know as above. The brand and logo will be displayed on the car as well as in all marketing campaigns. We will introduce the Tata Nano LX during the following year. consumers must be convinced there are meaningful differences among brands in the product or service category.will be sold with a three-year warranty or 100. It‘s all about creating differences between products.Branding Brands identify the source or maker of a product and allow consumers – either Individuals or organisations to assign responsibility for its performance to a particular Manufacturer or distributor. our missions are to promote Tata nano in Malaysia and increase the sales quarterly. Tata Nano will get into Malaysia market in July 2009. For branding strategies to be successful and brand value to be created. This company‘s name legitimises and the individual name individualises the new product Product Strategy The Tata Nano CX. In Tata Nano‘s case. after we have established our Tata brand. the branding strategy used is corporate name combined with individual product names.

preference. get more with Tata Nano’ Why we establish this tag line? Because this is make all the Malaysian to easy to remembered Tata Nano and feel happy all the ways with Tata Nano. conviction. And also will provide them warranty to the Tata Nano. We will organize all the promotion strategies with lower cost to maintain the lower purchase price for the Tata nano in Malaysia. This is the cheapest car in the world and burst into the worldwide market in the short time. Tata Nano is safety and you can travel everywhere by Tata Nano with your family or friends with fun. Beside that we can enjoying special fun with Tatanano.the objective for promotion strategies are aims to create brand awareness and concept/knowledge of this new car – Tata Nano. But still is the new brand for the Malaysians. so we do the advertisement and organize the event or campaign in sufficient detail to establish the good brand attitudes. our second objective is knowledge and persuasive. 16 . but you just need to pay all of this at lower price –Pay Less & Get More. We can do the comparison with other cars which are higher purchase price and this price is not every people will be affordable especially lower income families and students. After that. and purchase of a Tata Nano car. our earth also will feel happy with Tatanano because Tatanano also is the environment friendly car. Pay Less. Brand awareness is important to provide a foundation for brand equity. We aim to create liking. Promotion Tag line ‗Have Fun. Beside that we will convince current purchasers that we will give the potential customer to enjoying the good experience with Tata Nano by give try to drive the Tata Nano before buying the car.

com – on March 2009 to better communicate with the customers. In addition to photos and videos. Tata Nano created a Web site – www. Blogs have become an important outlet for word of mouth which are regularly updated online diaries. the web site links to recent news about Tata Nano and space for public feedback.tatanano. Blogs is bringing together people with common interests. Television Advertisement Television advertisement is very expensive but this is the most powerful to perform the Tata Nano to the public by demonstrating Tata Nano attributes and persuasively explaining their corresponding consumer benefits. we posted the photo categories and videos to provide customers the information and special features of Tata Nano and bring them inside the company. By lower advertising budget. so we just 17 . We can establish the blog network and carefully monitoring to find out what's on people's minds especially the potential customers. Online Advertisement First step we start before lunching Tata Nano.Advertising Program We aims to inform Malaysians this is the cheapest car in the world and persuade Malaysians to buy Tata Nano due to this car is safety. useful. all in good quality and also environment friendly by developing an advertising program. This is a cheapest and good way to build up brand awareness. They vary wide and can influence a vast audience due to many internet users have read Blogs. In the Web site. we cannot do the TV advertisement in whole day. Besides that. we do the online advertisement.

Promotion Flow Marketing Campaign/Event Have two ways of promotion flow. By properly designed and executed TV advertisement can improve brand equity and affect sales and profits. quick response and also more effective media for reaching teens. Directly is we'll organize the marketing campaign. is convenience for the people to listen the radio anytime at anywhere. most of the Malaysians also will saw a newspaper everyday. By this way. event and road show. Radio Advertisement Most of the Malaysians listen to the radio daily. we'll promote Tatanano to target market by face by face and provide the opportunities to them try to drive the Tatanano. Now a day have many facilities such as MP3. Newspaper advertising is inexpensive. From here. Newspaper Advertisement Beside that the radio. So this is good market coverage. Tata Nano can get the broad acceptance and good reputation from Malaysians. hand phone and so on. directly and indirectly. Advantages of the radio advertisement are flexibility.choose the prime time (7pm – 11pm) to place the advertisement. This is a cheap and pervasive medium for us to create the brand awareness by repeatedly listen the advertisement and the brand name. Indirect ways are we will do the dvertisement 18 .

Tata Motor aims to create brand awareness and increase the sales in the Malaysia.through media such as internet. TV. 19 . radio and also newspaper. By this promotion flow.

also they are advertising in magazines as well. 20 . main mall . Tata Nano has recently sponsored a reality show in india nano was the key sponsor for the program.also when someone made the online booking they are givivng merchandise to them such as t-shirts .watches and phone.they gave tata nano to each man of the match in a tournament .they did well by promoting the nano through this sport.they are marketing nano such a way that they are convincing people to test drive a nano and fill a simple form after the ride and that form will go in a luck draw and if they won they can own a tata nano.cricket is a famous sport in india.Evolution:Promotion Tata nano is promoted mostly in leading newspaper in india.orkut and other social networking websites. when nano was first out locked in india they advertise on the first full page of newspaper just to raise and turn the people face turn aroud towards their product also they are advertisement on hoarding on most viewable sites around the cities in whole country mainly in the places like bus standrailway stations . Nano has started a new campaign in their show room . Tata nano is also co-partner in the cricket series with new Zealand . In internet sector communities and they are promoting it through social websites by form group on facebook . They are also conducting online contests in which they excite the people to participate in it and upon winning they can drive away nano.

of blog posts 61664 Tata have a blog on the official website where they have been discussing quite interesting topics and generally maintain an active community. Pre launching the tata nano They have raised the curiosity all over world by just publishing that it is a 1lakh car and worlds cheapest car.internet will be a major media for advertising. Internet marketing program implementation Internet marketing is one of the most important aspects of an effective website . a) Online buzz:. Mainly from word of mouth . . 21 .communication strategy Tata has innovate communicated with whole work about their new product called nano in a effective way through media .nano has gone beyond the traditional methoda of advertising and promotion online. Internet . b)Social media communities:official orkut community member -6906 official facebook community page-4210 highest view count on youtube -303006 no. mainlyword ofmounth advetising will get more emphisis.internet marketing is a piece of the puzzle that joins your development efforts with actual sales.trade shows and auto shows. c) Advertising -tv and pther mass media will be less effective thus too much money will not be invested in thid regard .

special launchinf of nano done in auto expo held in india last year creating a hype was good medium.Tata motor have creates a special website for tata nano car . e) Trade shows. using the existing database of targeted customer.a trade fairin an exhibition organized so that companies in a specific industry can showcase and demonstration their lastest product service such as auto expo and auto fair.there are several listing in all the major car site like autocar. f) Program launch.com d)Sms marketing:-advertising through sending text messeage. 22 .

the car was envisioned by Ratan Tata .Conclusion:- Introduction of the Nano received media attention its targeted low price . particularly the electric version and beside selling them in india to export them worldwide 23 . chairman of the Tata Group and Tata Motors who has described it as an eco friendly ―people‘s car‖ nano has been gratly appreciated by many sources about the media for its low cost and eco friendly initiatives which include using compressed air as fuel and an electric version(e nano).Tata group is expected to mass manufacture the nano.

com/tatamotors/home.net 24 .tatamotors.com www.tatamotors.facebook.inservices.wikipedia.tatanano.org/wiki/Tata_Nano tatanano.htm www.com/TataNanoPage www.com‘ en.tatanano.Bibliography www.

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