Tata Ace

Topics: Marketing, Tata Motors, Product differentiation Pages: 5 (1036 words) Published: June 30, 2013
* Indian Commercial Vehicle (3+4 Wheeler) Sector
* Competitors
* Supporting Infrastructure

India’s First Mini Truck – Tata Ace
* Poised Indian Market for a Mini Truck
* Challenges Faced
Market Research
* Purpose
* Research Designs
* Analysis of Market Environment
* Results
* Potential Customers
* Discussions with Potential Customers Indicated (Design Challenges) * Stated Needs
* Real Needs
* Unstated Needs
* Value Proposition - “Small is Big”
* Rational and Emotional Considerations
* Market Positioning
* Market Segmentation
* Delivering Value
Market Launch
Future Strategy
* Increasing Product Depth
* Augmenting Value
* Consumer Base Expansion
* Sustaining value

The team did a commendable job for creating a successful product, but at the same time I would like to know from each of you, which opportunities do you think we should pursue in the coming future and what steps should we take to accomplish the same: As you all know we are running 100% capacity on our Pune plant, how do you plan to outsource and meet the increasing demand? “Systematise and institutionalize the cost down efforts during the design and development phase to make the product more cost competitive.” * Vendor managed inventory: Initially we can increase the number of parts outsourced from other vendors and thereby reducing the cost of inventory by passing it to other vendors. * New plant to be shared jointly by Tata Ace and Nano in order to bring about economies of scale. VRINDA:

Looks good!
But to meet the increased production we would have to strengthen our distribution network even in the interior parts of the country. How do we plan to do that? Currently, our network is second best in the country in terms of after-sales service. We plan to augment our distribution network by considering the following: * Expanding to Tier 2 regions (in sales of Three-wheelers) as compared to the regions targeted earlier during the launch. * Providing incentives to set up 1S dealerships.

* Increasing the number of 3S dealers.
* Providing insights to dealers to set up e-bidding and inventory management system. It helps reduce the turn-over time and saves cost. * Tie Up with financial institutions to provide easier loans. * Better distribution of spare-parts.

* Better distribution of accessories – like dumper attachment etc.

Pretty Promising Mohit!
But once we have invested into increasing the production capacity we need to make sure that our product demand is in line with the increased production. How do we plan to do that? (Rohit)
Analysis of Marketing Environment:

Indian Economy:
Indian cities are face with an ever-increasing road traffic leading to congestion. Villages too are getting a good amount of pucca roads.

Cost Reduction:
Three wheelers costed around 100,000-200,000 in the market. If ACE had to compete, its price should have been in the same region and was thus positioned around 200,000. Potential Customers:
Around 54% of the ACE customers are new entrants in the commercial transportation business. Stated Needs:
Last Miles Distribution Vehicle
Real Needs:
Operating Economic- Consumers who owned smaller businesses wanted a vehicle that was cost effective and fuel-efficient and at the same time helped them transport a small amount of load.

Unstated Needs:
Aspirational product- A four wheeler which was seen as a status symbol and an aspirational product as people owning three wheelers wanted to upgrade.

Market Segmentation:
There were primarily two sets of customers-
• Entry cost sensitive customers
• Customers who valued return-on-investment (ROI)
Tata Motors addressed two key concerns of commercial vehicle buyers- • Lead Time (more Trips)
• Load (overload)
Market Launch:

The launch was strategically confined to the four southern states and...
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