COMPREHENSIVE ASSIGNMENT-RURAL MARKETING

Rural Ventures and Foray of Tatas

Group 10
Abhinav Chauhan 17PGP001
Deepanshu Mewati 17PGP047
Mojahid Rahim 17PGP077
Atul Panthi 17PGP173
Contents:
1. TATA Motors – Project NEEV
2. Tata Tea – Gaon Chalo
3. Titan Sonata – Project Swadesh
4. TATA Motors “Ace”
5. Tata Kisan Sansar
6. Tata BP solar
7. Interview summary of Rural market visit
TATA Motors – Project NEEV
Objective

In order to strengthen its foothold in this previously-uncharted terrain, it was crucial that Tata Motors
moved quickly with an ‘out-of-the-box’ approach to create a one-of-a-kind rural sales channel, which
was competitive and could deliver results consistently and cost effectively. NEEV was conceptualized
to leverage the synergy between TML’s business team, who possessed the sales skills, and community-
based individuals who had a deep knowledge of the territory and the trust of the consumer. This
coupled with the company’s effort to find the right stimulus by accurately understanding the needs,
challenges and motivation of rural Indians, helped TML forge a path into rural India.

Project Outline

To increase the visibility and awareness about Project Neev, TATA Motors brought together and
deployed a network of ‘Tata Gram Mitras’ (TGMs) – a unique assemblage of youth from the Nehru
Yuva Kendra Sangathan, NGO workers from the Centre of NGOs of Rural India (CNRI) and owners of
Kisan Seva Kendras. The Nehru Yuva Kendra is a body under the Ministry of Youth Affairs and Sports
that is spread over 501 districts with access to over 1 lakh youth clubs. The Kisan Seva Kendra, a chain
of over 2,800 rural petrol pumps across India, has been used to spread awareness for TML products
by displaying its vehicles there. TML worked closely with the owners of KSK outlets to spread
awareness about TML products. The CNRI is a network of over 7,000 rural-focused NGOs. TML
leveraged their members as TGMs to pilot this project in their districts. To incentivize them, each TGM
was given a stipend for working with Project Neev and they were trained in sales, rural-specific
vernacular marketing and given a coverage plan. TGMs were then expected to source leads and pass
those along to TML via text message. They then receive a callback requesting the customer’s details
that is later forwarded to relevant dealers. TGMs are further rewarded with a commission for every
viable lead they manage to generate.

Easing Finance

TML also realized that the largely unbanked rural consumers’ access to finance could make or break
the decision to purchase an asset. Banks too were cognizant of the risks involved with lending to a
population that had no documentation or credit history. TML helped buyers to secure credit by
aligning with potential financiers to ease their eligibility criteria, and in return helped lending banks
access risk cover through the Government of India and SIDBI’s CGTMSE scheme by engaging with
NABARD.

The Impact on Customer and Sales Force

Over 70,000 TML customers became rural entrepreneurs, operating their own goods or passenger
transportation businesses, and spurred the rural economy through indirect demand for local
mechanics, spare parts and more. By 2015-16, TATA Motors had an indirect community sales force of
over 6,000 people earning an incremental income, 736 retailers of Ace/Magic and hired over 350
TGMs in full-time positions. Project Neev’s distinctive distribution model utilized the vast talent pool
of capable rural youth, up skilling them, making them more employable and them providing long-term
career opportunities at various levels indirectly and directly. Among consumers and the sales force,
the resulting incremental income and improved standard of living dissuaded a citable number of
individuals from migrating to cities to earn a living.
Tata Tea – Gaon Chalo
The “Gaon Chalo Abhiyan“ Project is promoted by Tata Global Beverages Ltd under its Corporate Social
Responsibility Programme. It was started in with the aim of market promotion of quality teas in rural
areas and provide livelihoods opportunities to small entrepreneurs and individuals of rural
communities.

TATA Tea distributes tea and endeavors to motivate rural people to generate additional livelihoods
through the marketing of TATA tea which is given to them at subsidized rates. The Enterprisers focuses
on marginalized families, single women headed households and small shopkeepers, tea shop owners,
differently challenged individuals, unemployed youth, retired persons and other disadvantaged
people to undertake this activity by buying at subsidized rates and selling at their M.R.P. These project
affiliates are then provided TATA TEA at rates which give them attractive margins on the MRP. The
supplementary income earned is vital for families and adds value to the quality of their lives.

The projects see great potential in extending the reach and depth in Gram Panchayats involving
Women’s Groups and Youth Groups .Future expansion will be dedicated to providing marketing skills
to individuals and groups. Entrepreneurship development for achieving sustainable livelihoods in
addition Social Coherence will get enhanced.
Gaon Chalo model has several business advantages which include limited fluctuations in sales due to
direct access to the rural retailers, creating a cost-effective brand building platform and the flexibility
to address the complexities of local markets.

Today, Gaon Chalo is present in 18 states with direct reach in 70,000 villages. The sales are growing
rapidly year-on-year. It enables a strong platform for generating rural employment for rural youth,
women, the underprivileged, the differently-abled and SHGs.

Titan Sonata – Project Swadesh

Sonata launched Project Swadesh, aimed at changing people's mindsets and making them aware of
the value of time. Titan Sonata used these learnings to project a watch as something that will help
people progress, the message communicated to people that a Sonata watch from Tata is reliable, of
good quality, affordable and can be instrumental to their success.

Pilot projects were started in rural Uttar Pradesh and Tamil Nadu, to test the market. Gaily decorated
mobile vans travelled around villages to generate interest. Sonata watches were also displayed at local
melas (fairs) and haats (markets).

Target segment is 20-35-year age group, about the kind of products they want, and also trying out
different price points. So, if customers want a watch at Rs 250 ($5), sonata have to see how they can
deliver the product in that price.
In rural areas where Sonata does not have a strong distribution network, there is need for setting up
a parallel distribution system that can provide access to interior areas at a low cost.

Project Swadesh is a pilot project and the team is still gathering information. They hope to have a
deliverable business model soon. "The biggest advantage is that India is progressing, and rural India
seems to be clear on what it wants.

Sonata is talking to banks for micro financing, so that more people can afford to buy watches. Another
interesting option for organizing financing is the post office where many people have savings accounts.
Sonata is also looking at training youngsters to market and service the watches. This will provide the
much-needed employment in rural areas.

Sonata is looking very seriously at driving down product costs in tune with Mr Tata's dream of offering
a low-cost watch (priced at around Rs 100 or $2), without compromising on quality. "Our efforts are
fairly encouraging; on paper Rs 175 ($3.5) seems possible today and we are working with our vendors
to reach the target.

TATA Motors “Ace”

TATA Motors realized that the entry level for the semi-urban and rural market was a product between
a three-wheeler and a pick-up truck, at a price-sensitive level. It put together a team to develop such
a vehicle, and it came up with an Ace.

A sturdy vehicle that can carry loads up to 1.5 tons over distances up to 300 km, the Ace is a four-
wheeler at a price slightly higher than a three-wheeler, but offering greater stability, safety and
comfort. More important, the operating cost was extended to a product lifecycle cost, which covered
purchase cost, operating cost and resale price. "It has the lowest product lifecycle cost; that is our
USP. It is essentially a last-mile load carrying vehicle, useful in congested cities as well.

Tata Motors took the Ace on road shows through villages and demonstrated the features and benefits.
Customers were encouraged to test drive the vehicles. The brand communication for the Ace was 'All
the goodness of the Tata Truck now in a mini size' – thereby the descriptor of the category as a mini-
truck. Using the metaphor of an elephant (a mother elephant representing the Tata truck), the Ace
was simply called the baby elephant (Chhota Haathi).

The low-price-high-performance Ace has cast its spell on auto financers in urban areas, who now offer
five-year financing for the vehicle (three-wheelers get only two/three-year financing), so that
customers pay a monthly instalment approximately the same as that for a three-wheeler. "The
instalment payment has gone down, and income has increased, boosting net earnings. The customer
is happy, and our sales have jumped. It's a win-win situation.
The Ace has been so successful that the company is struggling to meet demand. Today, the Ace is
available in only nine states, and Tata Motors is enhancing its capacity before launching the vehicle in
more states. The wheel of fortune rolls swiftly through semi-urban and rural India, as Tata Motors
changes people's lives for the better.

Tata Kisan Sansar

Tata Chemicals in its endeavour to bring prosperity into the lives of farmers, launched ‘Tata Kisan
Sansar’, a chain of one-stop resource centres. This unique initiative for farmers, the Tata Kisan Sansar,
will benefit farmers by offering end-to-end agri solutions including the latest in agro services and
specialized input products. The service ranging from agro input planning to crop procurement, will
assist farmers in their decision making process to increase their yield and align themselves to market
demands.
The key benefits provided by TKS to a farmer include easy access to the market and facilitate long
term, low interest credit by becoming a part of self-help group called Kisan Sahyog Pariwars (KSP).
Pilot projects of the KSP have already been successfully rolled out in 256 villages. The company has
trained agronomists to directly interact with the farmers for total agriculture related solutions. The
company has over 130 highly skilled agronomists that constantly track and bring the best agro-
practises to the farmers in the three states.

TKS will act as the business partner and advisor to farmers by providing the entire range of agro
services to them. It will create a favourable environment (Sansar) for the farmers, to help them
increase their yield thereby bringing prosperity in their lives. We have commenced our initiative with
421 TKS spanning three agricultural dense states of the North and we hope to expand our reach by
500 outlets by 2005.”

With the objective to help the farmer increase his yield through informed decision making, the
company will be setting up kiosks at all key locations to enable easy and real time access to the
information required by a farmer such as Mandi prices amongst others. TKS centres will also be IT
enabled and will track the profile of farmers visiting the centres. Through this the company will
improve its response time and service the farmer more efficiently. Apart from this, TKS will extend the
output buyback service (contract farming) that has already benefited farmers in 60 villages of UP and
Punjab. Besides this, TKS will continue to provide other farm management solutions as well.

Tata BP Solar
Tata BP Solar has been at the forefront of solar energy field since 1991. Tata BP Solar is playing a
key role in helping bridge the urban-rural energy divide. In India, energy planners think of power
requirements only in terms of large MWs. But, says Vora, in villages you need small amounts of
power; for homes and businesses such as shops and flour mills. Solar power can provide energy
security and, therefore developmental opportunities to 700 million rural Indians.

"Solar power is clean, eco-friendly and the most easy-to-set-up source of power. You don't need
large transmission towers, lengthy cabling and heavy switchgear. You can light an entire village in
less than a week," says K Subramanya, COO, Tata BP Solar. The needs of the rural people are
simple: fuel for cooking, water for drinking, light for studying, and television and telephone for
entertainment and connectivity.

Tata BP Solar has a slew of products such as solar home lighting systems, solar lanterns, solar
cookers and solar hot water systems, the innovation is in the packaged solutions that they have
designed for specific segments in rural India

Tata BP Solar has established itself as a provider of clean energy by extending its business line into
building integrated photovoltaics, captive power units and remote electrification systems

Interview Summary of Rural Market Visit

Interview with Shop owner of Krishi Seva Kendra
We interviewed one of the shop owners of Krishi Seva Kendra in Farfaud about the products of
Tata products which they carry. The shop owner showed us three products (Ananat, Applaud,
jashn) the products showed were used as pesticides.

The company provides material over phone call and the shopkeeper has to collect material from
a garage situated in Arang and Raipur city.

The payment for the material is done through cheque and the company also provides the material
on credit for 90 days, which makes people stick to the company. From this example the company
created an intervening variable of credit facility.
Interview with resident of Farfaud
We interviewed one of the residents of Farfaud we came to know that Tata sky has penetrated
well in the village with nearly 75% of the houses having the Tata Sky. The village is completely
electrified and has an internet access also and people are aware about the online payment system,
the people bring Tata sky from Arang this shows how to create the awareness and capture the
market.

Link of both interview:

https://drive.google.com/open?id=1zozVa1KAbDPDeoZEjdfzYMwC_Hr_3Mgl