THE TATA NANO ADVERTISING STRATEGY

COMPANY AT GLANCE
Tata Motors is Indias largest automobile company. Established in 1945, it is also among the worlds top five manufacturers of medium and heavy trucks and the world's second largest medium and heavy bus manufacturer. It entered the passenger vehicles segment in 1991 and now ranks second in India's in this market. The company, formerly known as Tata Engineering and Locomotive Company, began manufacturing commercial vehicles in 1954 with a 15-year collaboration agreement with Daimler Benz of Germany. It has, since, developed Tata Ace, India's first indigenous light commercial vehicle, Tata Safari, India's first sports utility vehicle, Tata Indica, India's first indigenously manufactured passenger car, and the Nano, the world's cheapest car.

OVERVIEW OF NANO :
The Tata Nano revealed at the New Delhi Auto Expo will play a key part in expanding the Indian automotive electronics market, according to Strategy Analytics. The advent of a significantly lower-cost alternative to the small, basic vehicles which currently dominate the Indian car market will further stimulate demand for automotive sensors and semiconductors. Tata's proposed initial production volume of 250 thousand units per year for the Nano, and anticipated rapid growth rate in the future, make low-cost vehicles an important growth market for Indian automotive electronics, despite the fact that they typically have very little electronic content right now. Strategy Analytics forecasts that Indian-produced basic vehicles will utilize $1.5 billion of automotive electronics systems in 2012, more than doubling the 2007 demand amount of $730 Million - a compound average annual growth rate of 16 percent.

CONCEPTUALIZATION
The project to create the world's cheapest production car began in 2003, under the Chairman of Tata Motors, Ratan Tata, inspired by the number of Indian families with twowheeled rather than four-wheeled transport. Contrary to speculation that the car might be a simple fourwheeled auto rickshaw, The Times of India reported the vehicle is "a properly designed and built car. The Chairman is reported to have said, "It is not a car with plastic curtains or no roof it's a real car.

DESIGN
To achieve its design parameters, Tata has refined the manufacturing process, emphasized innovation and sought new design approaches from suppliers the car was designed at Italy's Institute of Development in Automotive Engineering with Ratan Tata requesting certain changes, such the elimination of one of two windscreen wipers. The Nano has 21% more interior space and an 8% smaller exterior, when compared with its closest rival, the Maruti 800. The car will come in different versions, including one standard and two deluxe variants. The deluxe version will have air conditioning, but no power steering. The initial production target set by Tata Motors is 250,000 units per year.
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PRICING STRATEGY
Tata initially targeted the vehicle as "the least expensive production car in the world" aiming for a starting price of 100,000 rupees or approximately $2050 US despite rapidly rising material prices. As of August 2008, material costs have risen from 13% to 23% over the cars development, and Tata now faces the choice of:

introducing the car with an artificially low price through government-subsidies and tax-breaks, foregoing profit on the car, using vertical-integration, partially using inexpensive polymers or biodegradable plastics instead of a full metal-body, raising the price of the car

An increased price on the Nano will likely decrease demand.

THE LADDERING CONCEPT

TATA NANO:

VALUES

the common mans mode of transportation

BENEFITS

low priced

ATTRIBUTES simplistic design, compatible, crash test facility

TARGET MARKET
The low cost car is clearly intended for the masses. The Nano (the peoples car) target market is the 4 person family who cannot afford a car today - so along with folks in the large cities who can afford the SUVs there will be a big rural demand for this car i.e. a whole new market will be opened and a productivity and lifestyle improvement created that will benefit the India economy and that means the global economy. This is the point critics of the Nano in India are missing as they envision choked (as if they can get any more choked) city streets.

POSITIONING STRATEGY
The comfortably ranged price factor would clearly enhance the obvious temptation to come up with something like Cheap Thrill but, the positioning should be more on the lines of a Small car for people with big dreams.

OPTION 1
Pitch: The rationale for the pitch would essentially be that the new emerging India has a strong streak of ambition. So, this car is a dream for the great Indian middle-class. Though it is Rs1 lakh, it is no less than a Ferrari for the people who will buy it, as it gives them membership to an exclusive club.the snob effect of owing a 4-wheeler, something that they had been waiting for. How not to sell it: On the basis of functionality as it takes away from the romance of the car as a passport to an exclusive club. Also, wouldnt use a celebrity as it would deflect attention from the car, which is the real star.

OPTION 2
What Bajaj Chetak did to personal mobility, what Air Deccan did to flying, and what Airtel and Reliance did to personal communication, TATA Nano should focus their positioning strategy precisely on those lines. I would pitch it as a second freedom movement, as it would change the way family mobility is seen in India. The reason Ratan Tata thought of launch of a small car it is the fact that entire families, sometimes four people would ride on a bike together. Suddenly from that state, we are now going to one where people can afford a car and spend time together. It virtually frees them from a world of overcrowded trains, precarious rickshaws, from taxis they cant afford, and the absence of buses, problems that many countries face across the world. It took an Indian company to recognize this problem and address it.

How not to sell it: Pitching it on factors such as style or value for money should not be the strategic focus, as it is very clichd. Connecting to the masses is more crucial and not the just the isolated customer who can afford other cars. The communication needs to be honest in what it offers and what it can do it for the Indian family. Tagline: Azadi meri mutti mein

PROSPECTIVE COMPETITORS
Earlier, Maruti 800 has been the essential small car with a price tag of Rs 2 lakh and all aspiring car buyers have preferred it as their first car. Today, that may change to a certain extent. But this will in no way harm Maruti Suzuki or Hyundai Santro as owning a car is still aspirational and anyone who wanted to buy a car above the 3,400 mm series will continue to do so. Maruti 800 held a 30% market share in terms of sales in 2001 among all passenger cars. Today, it has fallen to a mere 5%. Maruti has laid stress on Alto while relegating 800 to the background, and it was a calculated move. Thus, they never wanted to be a part of the lower end segment of the car market. Same goes for Hyundai Santro. The launch of Nano creates a market for the small car which may allow competitors to enter this market with new models but should not harm their existing strategies. At most, Maruti may want to launch an exchange offer for 800 and give an attractive price for 800 buyers to migrate to Alto. They should then refurbish and put these used 800s in the market for Rs 70,000. This should act as a drag on some of the velocity that Nano is going to pick up. For other players, there are two strategies: First, get into this segment yourself. Second, cut down on operational expenses and make existing products available at a cheaper price.
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However, sudden price cuts will not be viable as a strategy. The competition will have to wait and watch how Nano is received, what all has gone into it to make it so affordable and then try and work a strategy around it. Even if Nano manages to convert 10% of existing the two-wheeler market-which is close to 900 million-Nano will have almost 50% market share of the car market. But that is provided that Nano remains the only car in that segment. Chances are this will become the hotbed for competition.

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Other Key Players in the Domain

Bajaj Auto-Renault-Nissan ULC. Bajaj Auto says its $2,500 car, which it is building with Renault and Nissan Motor, will aim at a fuel-efficiency of 30 km/litre, or twice an average small car, and carbon dioxide emissions of 100 gm/km. The Bajaj venture will have an initial capacity of 400,000 units, while Tata expects eventual demand of 1 million Nanos.

Others
Rival car makers including Fiat, General Motors, Ford Motor, Hyundai and Toyota Motor have all expressed interest in building a small car that is affordable to more middle-class consumers in emerging markets. The bulk of demand there is for small cars because people are much more sensitive to fuel prices. Honda and Toyota are leading the way on so called cleaner gasoline-electric hybrids, and some environmentalists argue getting prices down on these technologies is where efforts should be concentrated. Inexpensive and eco-friendly electric-cars like Tara Tiny, Oreva Super (both reportedly even cheaper than Tata Nano) and REVA pose even more significant danger to Nano.

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CREATIVE BRIEF FOR THE NANO CAR

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CREATIVE BRIEF FOR NANO CAR

CLIENT: TATA MOTORS. PRODUCT: Tata Nano. The 1 Lakh Car that might change
the world. The advertising campaign should be able generate an emotional connectivity in the mind of the customers with that of the Tata Nano.

TARGET AUDIENCE: Demographics

Region: India, majorly semi-urban and rural areas. Occupation: Service/working professional/self-employed, housewives, youngsters Gender: Unisexual Religion: Insignificant Social class: middle to lower-middle SEC: B, C. Family life cycle: newly-married, single.

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Behavioural
Occasions: Everyday usage. The most preferred mode of transportation which aims to capture the two-wheeler industry. User status: First time user Loyalty status: Not defined Readiness Stage: Relatively informed Attitude toward product: High-involvement Attitude toward brand: Trusting has high-recall value.

Key consumer benefits:

A comfortably priced four-wheeler, which enables the pricesensitive consumers to enjoy the privileges of owing a car.

Tone and Manner:

The tone of the advertising should be educative yet appealing. It should touch a chord in the readers heart so that he identifies with the communication and sees it as speaking directly to him. Establishing emotional bondage with the customer base is more significant than rendering on its low price, which is indeed a short term enticer for the quality conscious target customers.

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Product Specifications
According to Tata Group's Chairman Ratan Tata, the Nano is a 33 PS (33 hp/24 kW) car with a 623 cc rear engine and rear wheel drive, and has a fuel economy of 4.55 L/100 km (21.97 km/L, 51.7 mpg (US), 62 mpg (UK)) under city road conditions, and 3.85 L/100 km on highways (25.97 km/L, 61.1 mpg (US), 73.3 mpg (UK)). It is the first time a two-cylinder non-opposed petrol engine will be used in a car with a single balance shaft. Tata Motors has reportedly filed 34 patents related to the innovations in the design of Nano, with powertrain accounting for over half of them. Though the car has been appreciated by many sources, due to "the way it has tweaked existing technologies to target an asyet untapped segment of the market", yet it has been stated by the same sources that Nano is not quite "revolutionary in its technology", just low in price. Moreover, technologies which are expected of the new and yet-to-be-released car include a revolutionary compressed-air fuel system and an eco-friendly electric-version, technologies on which Tata is reportedly already working, though no official incorporation-date for these technologies in the new car has been released. According to Tata, the Nano complies with Bharat Stage-III and Euro-IV emission standards. Ratan Tata also said, 'The car has passed the full-frontal crash and the side impact crash. Tata Nano passed the required 'homologation tests
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with Pune-based Automotive Research Association of India (ARAI).This means that the car has met all the specified criteria for roadworthiness laid out by the government including emissions or noise & vibration and can now ply on Indian roads. Tata Nano managed to score around 24 km per litre during its homologation tests with ARAI. This makes Tata Nano the most fuel efficient car in India. Nano will be the first car in India to display the actual fuel mileage figures it recorded at ARAIs tests on its windshield. According to ARAI it conforms to Euro IV emission standards which will come into effect in India in 2010. Rear mounted engine: The use of a rear mounted engine to help maximize interior space makes the Nano similar to the original Fiat 500, another technically innovative "people's car". A concept vehicle similar in styling to the Nano, also with rear engine layout was proposed by the UK Rover Group in the 1990s to succeed the original Mini but was not put into production. The eventual new Mini was much larger and technically conservative. The independent, and now-defunct, MG Rover Group later based their Rover CityRover on the Tata Indica.

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ANALYSIS OF THE COMMUNICATION PROCESS

The Tata Nano Car being a high involvement product needs to be effectively communicated to the end users. The product specifications and ancillary benefits arising from its usage should also be focused in order to generate revenue. Apart from the quest for support and for utility, mere interest would seem to be an important factor in selectivity. The desire to see ones self reflection is a part of this process. So is the desire to keep watch over things in which one has invested ones ego. Thus Tata should categorically enhance the readers interest by building up imagery which would emotionally attract the customers to the product and exude a certain amount of small town warmth.

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Cashing in on the Brand Equity of TATA

The advertising campaign should also focus on the value which the brand Tata has acquired over the years to position their futuristic, revolutionary and overtly ambitious Tata Nano and redress it as truly a peoples car.

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Focus on Transformational Advertising:

Making the experience of using Tata Nano richer, warmer, more exciting and/or more enjoyable than that obtained solely from an objective description of the product. It must connect the experience of the advertisement so tightly with the experience of using the brand that consumers cannot remember the brand without recalling the experience generated by the advertisement. Transformational advertising must also ring true. It will not be effective if it is disconfirmed by real life experiences with the product. No amount of ride the friendly rails would transform the experience of riding sections of the New York subway! Effective transformational advertising should always be positive. It should necessarily focus on the strengths of the product Nano and the enjoyable experiences associated with driving a Tata Nano vehicle. A positive attitude toward the advertisement itself can affect the brand over and above any communication effect. When a feeling based ad leads to a more positive attitude toward the ad, it can lead to more positive brand attitudes, and to more positive thoughts about brand attributes.

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Conclusion
Enhance the likeability factor through ads Different ads can lead to the same overall level of attitude to the ad by following very different executional strategies. For e.g., three equally liked commercials i.e., having the same levels of attitude to the ad, may impact the consumer in completely different ways, as could two equally disliked commercials, one that is considered boring and the other irritatating. There has been a fair amount of research attempting to determine what it is that makes some commercials liked and how the liking level is affected by repetition. Thus what makes an everlasting impact on the mind of the consumer is an effectively positioned ad campaign which suits to their expectations. The Tata Nano concept, the latest offering from the house of Tata Motors has generated massive hysteria from the Indian customer base due to the strong positioning of the brand as the worlds cheapest car. Today, we indeed have a Peoples Car, which is affordable and yet built to meet safety requirements and emission norms, to be fuel efficient and low on emissions, . We are happy to present the Peoples Car to India and we hope it brings the joy, pride and utility of owning a car to many families who need personal mobility, narrated Mr. Ratan Tata, the pioneer behind the concept of the low-priced Tata Nano.

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Parameters on which Tata Nano should develop their advertising strategy: Credibility. Likeable and attractive celebrities, preferably someone with a mass appeal. Should contain useful information, but not too much to make it boring. Contains information that is itself liked. In this scenario driving cars is considered to be the indulgence of the affluent class, and thus many aspire to own a four wheeler. Emphasize on a sense of attachment/belongingness towards the brand and the product.

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MARKETING PROJECT DISHA MRINAL POOJA SWATI DEEPA

MANAGERS

INVOLVED

IN

13 - 27 - 34 - 58 - 12

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