ASIGNMENT ON SWOT ANALYSIS OF

TATA NANO

SESSION:-2012-2014

“TATA NANO…..THE ONE LAKH THAT CARS DRIVES ONE BILLION DREAMS’’

SUBMITTED TO:- SUBMITTED BY:-

PROF.RAJESHWAR NATH GAURAV GANGWAR

IDEA GENERATION :-

“I saw families riding around on scooters with kids standing up and the mother carrying a baby and sitting pillion and decided to do something about it. It started as a quest for an affordable transportation solution”. “RATAN TATA”

INTRODUCTION OF TATA NANO :- NANO which is a brain child of RATAN TATA raised hope for a lot of middle class families by giving them the status of owning a car. Expectations were increasing amongst the customers regarding the product, features and its efficiency .Competitors were eagerly waiting for its arrival to find “what is inside Nano?’’The only factor the customer knew in advance was its price tag of 1 lac as coveyed by Ratan Tata.But why was it is not big hit and why is it still lagging to grap the market in spite of its good and convincing features? We probed into the health of Tata Nano as a brand and aas a product and carried out a swot analysis of Nano.

“Dream –dream and dream,because dream gives vision ,vision gives thoughts and finally thoughts lead to the action’’ Each letter of these motivational words said by Indias’s Dr.A.P.J.ABDUL KALAM goes exactly with Mr.RATAN TATA,chairman of TATA GROUP who in the year 2003 dreamt of producing a safe affordable car for the common man finally after the wait of five years.,crossing all financial and unveiled Tata ‘Nano’ on 10 th January 2007,at the 9th AUTO EXPO 2008 in New Delhi.Tata Nano ,cool and smart,launched by Tata Motors is world’s chepest car with a price tag of $2500.

TATA NANO: SPECIFICATIONS

Looks: The snub-nosed car keeps in the tradition of the Fiat 500, Nissan Micra and the Smart.Dimensions: 3.1 metres (10.23 feet) long, 1.5 metres wide and 1.6 metres high. Can seat four to five peopleEngine: A two cylinder 623 cc, 35 horsepower rear mounted, all aluminium, multi-point fuel injection petrol engine can power the car to top speeds of 105 kilometres per hour (65 miles per hour).Fuel Efficiency: 20 kilometres per litre, or 50 miles per gallon is claimed.Pollution: Exceeds Indian regulatory requirements and can meet strict Euro IV emission standards. In terms of overall pollutants, Tata says the car is better than two-wheelers manufactured in India currently

SPECIFICATION

Safety: Car exceeds current regulatory requirements with a strong passenger compartment, crumple zones, intrusion resistant doors, seat belts, strong seats and anchorage.Nearest Domestic Car Rival: Maruti 800, part of Japanese-owned Suzuki Maruti stable whose base model sells for about 4,800 dollars – nearly double the price of the NanoNearest International Rival: China's Chery QQ which retails for 3,600 dollars.

Market: India's car market is a huge draw because car penetration is just seven per 1,000 people, compared to 550 per 1,000 in such countries asGermany or 476 in France, according to the Society of Indian Automobiles

PRODUCT FEATURES

o Length:- 3.1 mtro Wide:- 1.5 mtro Height:- 1.6 mtro Weight:- 600 Kgo Mileage:- 20 Kmplo Fuel tank:- 15 Ltro Engine:- 624 cco Top speed:- 95-100 Kpho Ground clearance:-180 mmo Gear box:- 4-speed

S T P

o Segmentation :Variable Usedo Geographic: rural and urbano Demographic: family size & income.o Behavioral: benefit & user status.o Target Market: Executive two wheeler segment,second hand car user, auto rickshaw

market, middle andlower income group people.o Positioning: TATA intending to place in the mind of theconsumers as a people’s car.o Strategic options: Undifferentiated marketing.

PRICING STRATEGY

Though the one lakh price tag is not fixed by TATA group, it was the word of mouth of people which fixed that range. This expectation of people creates a big challenge for the company. To accept this challenge the following strategies are followed:-

Target costing method Penetration pricing Low pricing policy with minimum profit margin.

PROMOTION ACTIVITIES

For other type of promotional activities ,cost factor that is 1 lakh price tag is to be keep in mind, TATA is going to launch its nano mobile for indicom user, nano watches , nano T-shirts available in Westside stores . Advertising:- TV & other mass media will be less effective, thus too much money will not be invested in this

regard .Mainly word of mouth advertising will get more emphasis. Internet will be a major media for advertising.

PROMOTION ACTIVITIES

Online buzz:-Nano has gone beyond the traditional methods of advertising and promotion online .

Social Media communities:- Official Orkut community Members - 6,906. Official Facebook Group Fans - 4,210 Highest View Count on You Tube- 303,006 (it was just under 3,00,000 when I began

writing this post) No. of Blog Posts - 61,664 TATA have a blog on the official website where they have been discussing quite

interesting topics and generally maintaining an active community.

DISTRIBUTION

So far we know TATA, it’s business has been extended to the overseas i.e. to the Europe, Africa, U.S & Australia.

Hence it has n-number of showrooms in India & outside of India. The exclusive showrooms are the best distribution channels for TATA itself.

POST PURCHASE SERVICE

o As Tata is going to provide this car with rupees one lakh only, so it may not give the same service like it’s other vehicles.

o But it’s post purchase services will be better than a costlier bike.o Customers may get minimum three services from Tata in any of it’s servicing center,

all over the country.o We the future customers, can also hope for additional services from TATA group.

SWOT ANALYSIS OF TATA NANO:-

STRENGTHS:-

Price itself was a major strength factor for the mini magical vehicle which created a sensation all

over the world. Even US president Obama was all praises for the Nano during his Indian visit, an

appreciation which soon spread across the world. The five seater car Nano from Tata finally

arrived in the market. The strengths of the product included its small size, ease in handling and

good mileage efficiency. It directly took on the motorcycle market and tried to attach a status

symbol to itself such that customers prefer the Nano above buying a motorcycle. Thus they get a

four wheeler instead of a two wheeler. However, sales did not happen as expected and Tata Nano

lagged behind.

WEAKNESS:-

The launch price came in two variants ranging between 1.2 lacs to 1.5lacs. It was 20 – 50%

higher then the proposed rates which was a major setback to customers. Within a few months of

initial sales, technical problems were found in the product and there were a few reports of Nano

catching fire, which further weakened the trust for the brand ‘Nano’ as a whole. Tata also faced

political problems and had to shift the plant location which led to production delays. And now

due to inflation, Nano’s prices have further increased due to increase in the prices of raw

material such as steel, rubber and others.

THREATS:-After the launch of Nano there were many manufacturers who wanted to take advantage of the

hype of the Tata nano, and started working on manufacturing an alternative for Nano. Upcoming

cars like H800 from Hyundai priced around 1.6 lac, Maruti Cervo 600cc priced around 1.7 lacs

to 2lacs were imposing threats to further growth of Nano’s market share. Vehicles like Alto,

Chevy Spark and second hand vehicles were major substitutes for Nano. People were looking for

alternatives for the main reason that it cannot be much used for driving in highways or long

distances as the engine cc is low. The main threat was from an indirect competitor –

Motorcycles. Nano was in between motorcycles and car and it was proving to be unreliable due

to technical glitches. Thus some people were going for the cost effective solution of buying

motorcycles thereby affecting Nano sales.

OPPORTUNITIES:-Though Nano is considered to be a boon for middle class people ,it is most often bought by the

people who already own one or two cars!! Nano is considered to be a vehicle of convenience to

drive in metro traffic. Nano 2012 is a new ray of hope in increasing number of sales and making

many satisfied customers. The increase in buying power of the younger generation is a major

factor for India’s automobile growth. Tata Nano diesel priced at 3.5lacs has already created a

hype among its customers as Tata is known for its diesel products with high mileage efficiency

like Indica and Indigo CS

Even Rata tata has admitted that they were wrong in the positioning of the Nano and that the

initial marketing effort was poor. Instead Nano should have been marketed as a utility car rather

than a “cheap car”.

Many manufacturers are still striving hard to compete with Nano, even they will have many

drawbacks and failures and it should be a better product than Nano. Certainly revolutions aren’t

usually neat and tidy to start with; hence Nano too is a revolution in Indian Automobile history.

THANKYOU