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A Report on TATA Indica in partial fulfilment of Marketing Management Course at School of Inspired Leadership L

Team Members:
Raj Shekhar Gaurav Shahare Arun Sahu Krishnan Laksmikanathan Ankit Ahuja Neha Singh
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Table of Contents
History Story of Indica Evolution of Indica &-Portfolio Management Segmentation
Geographic Demographic Behavioural

Target Audience Positioning SWOT Analysis The Three Cs


Company Consumers Competitors

Marketing Mix Product


Brand Packaging Innovation Quality Control

Price
Pricing Strategy Alterations Discounts

Promotion & Promotion Strategy


Personal Selling Advertising Sales Promotion Public Relations 2

Place
Channel of Distribution Physical Distribution

Product Level & Hierarchy Appendix -I (Poll results about Indica)

HISTORY The Tata Indica is a hatchback automobile range manufactured by Tata Motors of India. It is the first passenger car from Tata Motors and is also considered India's first indigenously developed passenger car. On 30 December 1998, Tata Motors (previously called TELCO) introduced the most modern car ever to be designed by an Indian company: the Indica. Initially introduced with the caption "More cars per car," the ad campaign focused on roomy interiors and affordability. Within a week of its unveiling in 1999, the company received 115,000 bookings. In two years, the Indica became the number one car in hatchback segment. The Indica offered options like air conditioning and electric windows, which were previously restricted to only upmarket imported cars in India along with 5 doors. Three years later the Indica was exported to European markets for the first time, and from 2003 the Indica was badge engineered and sold in the UK as the Rover CityRover. The outer body styling was done by Italian design house I.DE.A Institute, under contract from Tata Motors, with heavy interaction with Tata's inhouse design team. The engine, however, was indigenous.

Story of INDICA

In 1990 Mr. Ratan Tata thought of developing a small car ,In1995,Telco announced that it planned to build a car which would be priced closed to the Maruti 800,shaped like the Zen, and spacious as an ambassador. A car could be built in 48 months with an investment of Rs127.5 billion; Indica was built in 31 months on a budget of Rs 17 billion.

Tata Indica Trends


Units sold 150000 100000 50000 0

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EVOLUTION of Indica Portfolio Management


Indica is a brand that is an epitome of persistence. Tata Motors through Indica has demonstrated how to manage product lifecycle effectively. The brand which was launched in 1998 has passed through many hurdles. The brand successfully transcended the initial flaws, bad customer /expert reviews and brickbats to become one of the largest selling cars in the Indian auto industry.

The brand has survived and thrived because of the constant focus of Tata to improve the product continuously. More than the product innovation, it was the value proposition that forced customers to choose Indica despite all those nagging troubles. Though a lot of Indica Customers are cribbing about the bad service and constant trip to the service centers, they still prefer sticking to the brand because of the value proposition. One may not get a diesel car with that much space at the price at which Indica is selling.

Tata Motors has been continuously tweaking the brand over these years sometimes making quantum leap in the quality and refinement of the product. A snapshot of the brand's evolution is given below: 1998 - Indica announced 2001 - Indica V2 2004 - Rejuvenated Indica V2 2005- Indica V2 Turbo Diesel 2006- Indica Xeta 2008 - Indica Vista

The brand made a quantum leap in 2008 with the launch of Indica Vista. The entire brand personality changed with the launch of Vista. The product's looks and feel had changed completely and it was a rebirth for Indica. The change in the product was not limited to exteriors. Indica began sporting different types of engines from Fiat which gave a new perception of quality to the brand.

At the pricing also, Tata Motors consciously raised the Vista brand to a higher level . The Vista is pricier than the original V2 thus reducing the attractiveness of the brand to the Taxi segment. At a price range of Rs 4 - Rs 5 Lakh, Indica Vista is not a cheap diesel car. It is an effort to stretch the brand upwards.
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The Indica Brand portfolio is given below:

SEGMENTATION
GEOGRAPHIC: Region: All over India City or Urban: Urban, Sub Urban. DEMOGRAPHIC: Age Income Family Occupation Social Class BEHAVIORAL: Behavioural Occasion Usage Rate Benefits Loyalty Status Readiness Stage User status : Special Occasion : Light to Medium User. : Economy, Quality, Speed : Medium : Informed, Interested, Intending to buy : Non User and First Time Use : 30+ years. : Rs.25000+ per month. : 3 to 4 members. : Service men, Executives : Upper middle

Target Audience
To target middle aged non user and first time user of urban and semi urban area earning more thanRs25, 000 per month and believe in efficiency and quality within a given budget.

POSITIONING Attribute Positioning Better fuel efficiency at a competitive price Indica was marketed with slogans like "The Big... Small Car" and "More cars per car," the ad campaign focused on roomy interiors. Indica is positioned as affordable car. As the First passenger car developed in India.

SWOT Analysis

Strength
Large distribution network Vast experience Good mileage After sales service Sturdy body TATA brand name

Weakness
No Attractive looks Crude Interiors

Opportunity
High growth Rate of Premium Hatchbacks

Threats
Heavy Competition High Fuel price

The Three Cs Company


Established in 1945, TATA motors has emerged from being a manufacturer of locomotives to become a producer of buses, lorries, cars, SUVs and even sedans. The company is the worlds fifth largest manufacturer of medium and heavy commercial vehicles and also the worlds second largest manufacturer of medium and heavy buses. Over the last few decades, TATA has been focusing more and more on manufacturing and marketing main-stream consumer cars.

Consumers
The Indian economy cars are mostly brought by people from the so-called middle class of the Indian society. The middle class constitutes the largest section of the Indian society. It is notable that the majority of the people from the middle class use a motorcycle or scooter for everyday transportation. Since the independence of India in the late 1940s, the middle class has proved to be a rapidly growing segment. This rapid growth is an incentive for the makers/sellers of products like cell phones, budget cars (bike replacements), 2nd hand automobiles etc. Competitors Main competitors of TATA motors include Hyundai and Maruti- Suzuki motors. Maruti-Suzuki manufactures the Alto which is directly aimed at the Indian economy car buyers .Other competitors of TATA motors in the economy car segment include the motor bike and scooter manufacturers as well as the 2nd hand car and refurbished car market. This is because of the nature of the Indian middle class where people still purchase 2 wheelers or refurbished 4 wheelers for their everyday transportation needs. So companies like TATA that target this segment need to be aware of other forms of competition such as those mentioned above

Marketing Mix:
Marketing is the process by which a product or service originates and is then priced, promoted, and distributed to consumers. The principal marketing functions involve market research and product development, design, and testing. It is the business activity of presenting products or services in such a way as to make them desirable. One has to consider promotion that is balanced with a suitable product available at a reasonable price, provided at all places to maximize the sale of ones product. MARKETING MIX PRODUCT Brand Packaging Innovations Quality PRICE Pricing Strategy Pricing & Quality Price & Alterations Discounts PROMOTION Personal Selling Advertising Public Relations PLACE Channels of Distributions Physical Distribution Wholesaler & Retailers

1. PRODUCT (Brand, Packaging, Innovations, Quality): a. Brand: Advertising is often used to make consumers aware of a products special low price or its benefits. But an even more important function of advertising is to create an image that consumers associate with a product, known as the brand image. The brand image
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goes far beyond the functional characteristics of the product. The products of Tata Indica have many special characteristics to them, but when consumers think of it, they not only think of its features, but they may also associate it with quality, performance, and class. All of these meanings have been added to the product by advertising. Consumers frequently buy the product not only for its functional characteristics but also because they want to be identified with the image associated with the brand. Tata Indica has been successful in creating and maintaining a professional brand image. b. Packaging: A vehicle cannot have a material packaging. Here, packaging refers to and effective assembly of features. Tata Indica provides many innovative features to suit the target customers. c. Innovations: The various motives behind buying an automobile are Need, Prestige, Comfort, Fashion, Jealousy and Novelty. The R & D Department continuously strives to bring new innovations in their product. Tats have an industrial experience of over 100 years and they are well known with the Psychology of Indian customers, who desire more at less price. This experience has helped them to develop products which fulfil the expectations of Indian consumers. d. Quality Control: Tata Indica has their Quality Control standards and the QC Dept. ensures that the customer does not face any inconveniences of a defective product.

2. PRICE a. Pricing Strategy: The prices are fixed keeping in mind a number of factors. As told by Mr. Desai, prices have to be at par with the prices of the competitors. Tata Indica gave a relative price advantage as compares to its competitors. The various determinants of price are I. Market Condition ii. Costs incurred iii. Profit percentage desired by the Co. Iv. Dealer Profit

Setting Price Policy

b. Alterations: The Company does not allow any alterations to any of the features of the product. If there is an alteration which affects the performance of the engine, then the warranty becomes void. However, there may be alterations in the accessories, if desired by the customer. c. Discounts: Discounts are decided by the Co. every month. Any further discounts made from the profits of the dealer. However, the Co. may compensate the dealer for the discounts allowed to a certain extent. 3. PROMOTION (Personal Selling, Advertising, Sales Promotion, Public Relations) Promotion Strategy Advertising Strategy: The key feature on which the Indicas marketing strategy is based is that of being Indias first indigenously developed small car (by Indians for Indians). In addition, the marketing strategy was aimed at addressing long-standing Indian buying concerns, namely value for money, fuel efficiency and sturdiness of build. The Indica V2 has several additional features and accessories added over its predecessor, such as enhanced absorbers, suspension, differential gears and enhanced
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manoeuvrability. These features when taken in combination form formidable sales pitch by themselves for the Indica. Dealer Observations: The dealers were focused on promoting their product through road-shows at frequently-visited and popular locations; advertising strategy was by means of placing advertisements in both vernacular newspapers and English newspapers advertising the dealership; other forms of media were less frequently used. Customer benefits and incentives Most car companies focus on accessories and financing options when it comes to providing customer benefits and enhancements. Tata Motors, however, provides a number of additional benefits and incentives which are unique in their own right. Tata Motors, however, provides a number of additional benefits and incentives which are unique in their own right. a) Enhanced accessories range: The Indica V2 basic model is supplemented by a wide range of accessories which fall under the broad categories of comfort, style, ambience and car care. Car spoilers, roof rails, alloy wheels, custom audio systems, chillers and warmers and cutting-edge car security systems are some of the optional accessories offered by Tata Motors. b) Easy Financing option: Any individual satisfying the specified income and age levels for applying for financing option will find a lot of the regular tedium associated with financing eliminated using Tata Motors wide-ranging and user-friendly financing options. c) Insurance Information: Although base insurance for four-wheelers is mandatory in India, this fails to cover damages to property or persons; Tata Motors provides helpful information regarding the insurance schemes available to the customers whom they can avail of, and the benefits associated with each scheme. d) Indica Club: This is a unique customer relations effort launched by Tata Motors which aims at value addition to the customer to maximize satisfaction in the post-purchase period. This effort provides additional privileges, offers and events to Indica owners free of cost, such as invites to
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special events and discounts with several leading brands such as Tanishq, Zodiac and Kenwood Music Systems. Customer Delivered Value Monetary Cost: High Energy Cost: Medium Service Value: Medium Product Value: Medium Time Cost: Medium Psychic Cost: High Image Value: Medium Personnel Value: Medium

VALUE CHAIN ANALYSIS

a. Personal Selling: There is minimal personal selling involved. The Sales Officers at the dealerships collect prospective customer databases and perform cold calling to attract customers. b. Advertising: Advertising is a form of commercial mass communication designed to promote the sale of a product or service. Tata Motors is responsible for the advertising of its products. The dealer does play any role in the advertising. The various media used for advertising are T.V., Newspapers, Magazines, Hoardings, and Internet etc. The dealer conducts point-of-purchase displays to advertise the products. The advertisements done by the Co. help the dealer to capitalize on the market.
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c. Sales Promotion: The purpose of sales promotion is to supplement and coordinate advertising and personal selling; Sales promotions are designed to persuade consumers to purchase immediately by providing special incentives such as cash rebates, prizes, extra product, or gifts. The Co. conducts intensive sales promotion during festivals such as festive discounts during Diwali. d. Public Relations : Public Relations is a management function that creates, develops, and carries out policies and programs to influence public opinion or public reaction about an idea, a product, or an organization. The Co. takes serious measures to maintain good public relations. The Co. follows business ethics to ensure that the customer is satisfied and receives good service whenever and wherever he desires

4. PLACE (Channels of Distribution, Physical Distribution) a. Channels of Distribution: In case of vehicles, dealership method of distribution and sales is generally adopted. Tata Motors have also adopted dealership method of distribution of its products. The dealers purchase products from the Co. at a negotiated price. The MRP is fixed by the Co. and the dealer gets a profit within these prices. As the Co. deals in commercial and passenger vehicles, there may be a single or distinct dealerships to market its commercial and passenger vehicles in a town. However, if there is a single dealership appointed, then these are managed separately. Tata Motors have contracts with the Government of India and it supplies buses and passenger vehicles, in some cases, to the Govt. Sometimes, bulk quantities of vehicles are ordered by a Govt. Dept. or a private company. The sales, distribution and billing of these are looked after by the Co. itself. B. Physical Distribution: The commercial vehicles are manufactured at

Jamshedpur, Lucknow and Pantnagar whereas the passenger vehicles are manufactured at Pune plant. From the plant, the finished product is transported to the dealerships. The nation-wide dealership, sales, services and spare parts network comprises over 2,000 touch points. The dealerships are strategically located in the target and potential markets to ensure efficient and timely availability of its products in the market.

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Product Level & Hierarchy: Product Level Product Hierarchy

Core Benefit --Transportation Basic Product --Metallic body with an engine and mounted on wheels and axles Expected Product --Fuel Efficient Augmented Product --Design

Need Family --Transportation Product Family--Vehicle Product Class --Car Product Line --Small Car Product Type --Fuel Efficient small car Item --Indica

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Appendix I Poll Results

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