STRATERGIC PLANNING AND ENTREPRENEURSHIP

TATA – NANO CASE STUDY

PB-17 Yash Priy

PB-16 Rohit Raj

PB-30 Udit Pradhan

INTRODUCTION -
Tata Nano is a compact vehicle that was produced and showcased by Indian automaker
Tata Motors, principally in India, as a modest back-engine hatchback expected to speak to
current riders of bikes and bikes — with a dispatch cost of Rs 1,00,000 or $2500. Delays
during the production line migration from Singur to Sanand, early cases of the Nano bursting
into flames, the impression of the vehicle being perilous, and compromise in quality due to
cost slicing are some of factors behind Tata's failure to attract Indians.
Here we present the case study of tata motors – nano case and find out why did Tata Nano
Failed and never gained traction despite being termed as the 'people's car'.
Tata Motors anticipated creation of 250,000 every year at dispatch. This didn't happen. Only
7591 were sold for the model year 2016-17. In 2017, Tata Motors said assembling would
proceed because of Tata's passionate promise to the project. In 2018, Cyrus Mistry, previous
Chairman of the Tata Group, called the Tata Nano a venture in progress with China, with a
generation overhaul scheduled in May 2018.

TATA MOTORS' NANO INITIATIVE -

After effectively propelling the ease of Tata Ace truck in 2005, Tata Motors started the
advancement of a reasonable vehicle that would speak to the numerous Indians who ride
motorcycles. The price tag of this nitty-gritty auto was brought somewhere around getting
rid of the most superfluous highlights, diminishing the measure of steel utilized in its
development, and depending on ease of Indian labour.
The superfluous highlights include the evacuation of the traveller's side wing mirror, having
one wiper sharp edge, having just three fasteners for every wheel, and the expulsion of the
fuel filler top from the fuel tank. The presentation of the Nano got much media consideration
because of its low cost of Rs. 100,000. The vehicle was promoted as "The People's Car".

INITIAL EFFECTS OF TATA NANO -

A report by the Indian rating office CRISIL figured the Nano would extend the country's
vehicle advertising by 65%, in any case, starting late 2012. However, deals in the initial two
monetary years after the vehicle's divulging stayed unfaltering at around 70,000 units. Tata
still proposed the ability to deliver the vehicle in a lot bigger amounts, somewhere in the
range of 250,000 every year, if the need arise.
It was foreseen that its 2009 presentation would significantly influence the trade-in vehicle
market, and costs dropped 25–30% before the launch. Sales of the Nano's closest rival, the
Maruti 800, fell by 20% promptly following the disclosing of the Nano.
It is obscure if the Nano has lastingly affected the costs of and interests for close substitutes.
In July 2012, Tata's Group administrator- Ratan Tata, who resigned in January 2014, said that
the vehicle had huge potential while conceding that the early open doors were squandered
because of starting problems. Due to the business drops, just a solitary unit was delivered in
June 2018.

MANUFACTURING PROCESS

MARKETING AND BUSINESS STRATEGY OF TATA NANO -India is

an organization with a larger part of its populace dwelling as a low pay
gathering. Purchasing a vehicle is still a fantasy for many families in India. In
the year 2008, Ratan Tata reported the dispatch of its new vehicle, which would
be a progressive item in the car division. He called it a 1 Lakh rupee vehicle and
the same title was used for promotions.
The fantasy of a middle and even lower white collar class family unit to have
their very own vehicle woke up with this declaration from Tata Motors. It was
hailed to be cutting edge innovation and was commended by international
media. An entirely unexpected story unfurled when the vehicle appeared on the
streets.
INDIAN CUSTOMER'S NEEDS -
Ratan Tata's flash for the Nano came when he saw groups of 3-4 individuals
utilizing a motorbike for transportation. There are a great many bicycles in
India, and it has constantly presented well-being worries for the general
population. In blend with the poor street conditions in India and conveying a
full family on a bike, bikers are subjected to numerous mishaps.
His strategical view drove the concept of a low-cost vehicle and chose that the 1
Lakh Rupee sticker price will be appealing to the objective market.
PROCLAMATION -
At the point when Tato Nano was declared in the long stretch of January 2008,
it was over-advertised to be the vehicle of each Indian. The cost of Nano was
pegged at Rs. 1 lakh or $2500 by Ratan Tata, the Chairman of the Tata Group
by then of time.
It turned into a fantasy vehicle for each individual having a place with the lower
working class and even the lower class. Anyway, the service of the vehicle
additionally raised worries about the blockage on streets that the vehicle would
acquire as individuals began to utilize it for everyday transportation.
STRATEGIC PLANS -
TATA Motors fundamentally segmented and focused on the following
sections of the Indian population:

 The middle class- Fundamentally the lower white-collar class.

 Upper lower class- Normally the bike clients
 Family with 3-4 individuals who have inconveniences while going on
a 2-wheeler.

AFFORDABILITY AND FAMILY FRIENDLY USAGE -
Tata Nano being propelled in the Indian market was an opportunity for the
normal man of India to fulfil his dream of owning a vehicle. The promotions
and media productions featured the passionate remainder that demonstrated the
joy of youngsters when they see a vehicle coming to their home, and the joy on
the substance of the relatives who delineated a white-collar class gathering.
The battling Indian classes who had a month to month pay of under Rs.6000
every month and comprised more than 110 million families got the chance to
dream of purchasing a vehicle. Mr. Ramesh Mangaleswaran, an accomplice of
McKinsey and co., anticipated that in Mumbai alone the 2 million individuals
who rode a cruiser ordinary would now attempt to lift themselves to purchase a
Tata Nano.
It was expected that Tata Nano would make a progressive change in the way of
life, uncommonly concerning the substitution of the regular man. It would turn
into a face of the Indian lower class, just like the Bajaj Scooter at one time
represented the white-collar class.
WHY TATA NANO FAILED?

Ratan Tata stayed faithful to his obligation and the Indian market saw Nano set
on the streets in the long stretch of July 2009. At the start, the deals for the
vehicle were high. It then began to decay on every month. There are a few
reasons of failure which justify Tata Nano's downfall,
 Failure in marketing the vehicle was the main reason behind Tata Nano's
Failure to attract customers.
 TATA nano promotes itself as the least expensive vehicle.
 No one needs to drive the least expensive vehicle.
 Purchasing a vehicle is identified with economic well-being and
distinction in the public arena.
 "Cheap" and "lakh Takia" used in Tata Nano's advertising for
advancement and showcasing all over India disturbed its image.
 The engine was an issue.
 There was a buzz in the universal media, "What if Nano becomes
successful? It would mean an end to the second-hand car market."

PROBLEMS WITH THE MANUFACTURING OF THE CAR -
 Awful picture of the shoddy vehicle.
 Several cars caught fire. Thus, in spite of its low cost, people refrained
from buying it.
 Media channels covering the news related to Tata Nano underestimated
the vehicle. In any case, they were correct.
 The car was not fit for sloping territories.
 The motor used to make a great deal of clamour, and individuals even
compared it with an auto.
 Insides were dull with inadequate leg space.
 The whole assemblage of Nano was light and prone to damage on even
the slightest of knocks.
OTHER REASONS/FACTORS -
 Tata Nano got around 200,000 appointments at first. This made
Tata Motors complacent, and it didn't bother about new
advertising strategies. New publicity procedures were essential
to keep the enthusiasm of the individuals unblemished. But it
wasn't done. When the main flame episode was accounted for,
the ad system then just looked responsive and upgraded rather
than focusing on negative attention.
 Nano was viewed as an attraction for individuals who never
thought of purchasing a vehicle. It was focused on engine cycle
 riders, recycled vehicle proprietors, and different families in the
lower white-collar class gathering. This prompted some degree
of opposition. According to the intended interest group, the
media and the general public acknowledged Tata Nano as a poor
man's vehicle.
 Ratan Tata in his previous question and answer sessions
referenced that he wanted to position Tata Nano as a
'reasonable, all climate family vehicle".
 At the point when Nano later raised its cost to conquer the
negatives of the principal model, the cost turned out to be a lot
higher. The top-end Model of Tata Nano (2014) was cited at an
on-street cost of around Rs.2.6 lakhs in Bangalore. This sort of
evaluation with the equivalent Nano model which the poor man
likewise claimed, confounded the clients.

TATA NANO'S ATTEMPTED COMEBACK -

In the year 2013 Tata engines re-propelled Tata Nano with new components and
publicity efforts. The re-dispatch concentrated on the following:
Focusing on the young people of the nation, the new Nano had extravagant
settings like settings and shading blends, for example, ranch side or experience
sports. The ads and crusades this time concentrated on the adroitness factor. The
emphasis was, "Why not purchase a Nano when it gives everything at a deeply
discounted?" It additionally featured the rational advantage of Fuel productivity
in another manner.
This time, Tata Nano pursued another sort of crusade altogether. They began to
support programs on MTV that energized experience sports and stretched out
the crusade on National TV.
Like the arrangement Roadies circulated on MTV where the members need to
go on a Hero Karizma, they attempted to execute a comparable technique where
the members were approached to traverse India in a Tata Nano. This validated
the intense with which the vehicle was fabricated.
It concentrated on the passionate parts of a parent, and the car was promoted
such that guardians can give their children a Tata Nano as opposed to giving
them bicycles; a vehicle is more secure than a bicycle. This would likewise
make them brilliant guardians.

KEY TAKEWAYS -
1. The 'Solution' lesson - The best of brands know they are in the business of
solutions not products. To get this right, businesses have to abandon the
engineering mindset, one that's focused on building products, not solutions.
'Frugal engineering' once described as the powering force behind the Nano
miracle stands exposed today. Frugal cuts back on spending, thus cutting back
on building a solution. All frugal engineering does is build products that work.
That is just the default limited job done, and that's not good enough to step into
solution territory. To me, the Tata Nano was more a 'product' than a 'solution'.
You see, buyers don't give a whit to products, they seek after solutions.
2. The 'Value' lesson - An extension to the solution lesson, value is about what
consumers seek and desire. Understanding value in its entirety requires
businesses step outside the limiting confines of viewing value only as utility.
You see, value is way beyond mere utility. Value encompasses elements that are
sociological and psychogenic in nature. Meaning, consumption has social and
psychological contexts to it. A car is as much about a 'place in society's it is
about transportation. Again, a car is as much about persona exhibitions as it is
about mobility. Stepping into such zones of value is seeing value in its entirety.
Unfortunately for the Tata Nano, its delivery of value was merely utilitarian.
3. The 'Competition' lesson - An assessment of value by consumers is never an
'absolute' one. In fact, value assessments are arrived at in a 'relative' fashion, in
a competitive marketplace. No buyer considers a car brand for purchase without
pitching it against other brands. When such comparisons happen, what may
seem like value to the seller, may not be the 'best' value to the buyer from
among the choices he/she has. The Tata Nano may have scored on the price
parameter vis-a-vis competing brands, but on every other element of value it
under-performed. Buyers thus found better propositions in budget cars, and they
were willing to pay a higher price
4. The 'Positioning' Lesson - Many times marketers tend to believe positioning
is only about marketing communication. Dead wrong. Positioning is about
occupying a distinct space in the minds of consumers using every possible
marketing stimuli available. In theory, that means all marketing mix variables.
The Tata Nano tried to advertise its way into positioning itself. It just didn't
work. First, the brand ran Ads to appeal to families, and when it didn't do the
job, it used Masaba Gupta and the 'Twist' avatar to appeal to Indian youth.
Again, it failed. What happened was that every other stimuli, including the
product itself worked at crossroads to what the Ads were trying to portray.
Truth be told, the unappealing looks of the product, to its lack of status value
negated everything advertising was trying to pitch. Such a pity all that
advertising effort was wasted dollars.