Tata Nano: Segmentation, Targeting and Positioning
Stage 3 and 4 Note
Towards partial fulfillment of the requirements of the course
Business Research Methods
Group – II, Section – B
Prof. Arvind Sahay
Date of Submission – 16th March 2009
Mohit Kumar Lohia
Ferzand F K
Indian automobile industry and the small car segment in particular was witness to history being created when Mr. Ratan Tata unveiled ‘Nano’ – the Rs. 1 Lakh ($2,500) small car from Tata Motors. Nano is conceptualized and designed to fulfill the middle income Indian household’s dream of owning a car. It is projected that Nano is going to expand the Indian small car segment volume by as much as 65%. Against this backdrop, Tata Motors’ recent announcement of Nano delivery starting from April 2009 provides us with a perfect opportunity to conduct business research on the various critical aspects of Tata Motor’s marketing plan for Nano. Hence, we choose this as our business research project.
Tata Motors Ltd, controlled by the House of Tata, is the fifth-largest manufacturer of medium and heavy commercial vehicles and the second largest medium and heavy bus manufacturer in the world. It is the leader by far in commercial vehicles in each segment, and the second largest in the passenger vehicles market in India.
Starting from Rs. 100,000 or $2,500 Nano is the world’s cheapest car and this has generated considerable awe and admiration from global auto industry stalwarts. With 37 patents, it has taken innovation to a new level and at the same time managed to produce an excellently designed small car.
The company has announced the launch of the Nano in April 2009. We believe the production at initial stages will begin at the Pantnagar or Pune plant, till the company’s plant in Sanand, Gujarat, is commissioned. The initial production at these plants is likely to be minimal; media estimates an approximate volume of 3,000 units per month.
Tata Motors is planning to launch Nano in the coming days. There are variety of questions in front of the company related to the product launch like- the target segment for Nano, positioning of brand, the promotional activities to be chosen, distribution strategy, how consumer credit is to be offered. And all of these essentially are part of the launch problem.
The key management problem therefore is –
How to make Tata Nano the most successful small car in the country?
The marketing problem that Tata Motors is concerned about the Nano is the following –
Devise a marketing strategy and plan for Tata Nano
Market Research Problem:
The stated marketing strategy problem involves customer segmentation, targeting and brand positioning as the three most important aspects of it. The market research objective therefore pertains to the same.
In this project the specific marketing research objective is two-fold:
1. What would be the important target segments for Tata Nano and what are their respective sizes?
2. What should be the positioning of Tata Nano for its target segments?
Corresponding to these research objectives, there are several research problems like the following:
1. To find the likely profile of a customer buying Nano – demographics, income level, prior vehicle ownership, usage for the car, psychographics – based on which we can arrive at the segmentation – for example, children of rich parent, 2nd car owners, upgrades from two-wheelers, first car etc.
2. To come up with the positioning to be pursued in each segment.
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References: carazoo.com , Used Car Market - Booming in India, dated May 8th, 2008. Retrieved on 5th March 2009 from http://www.articlesbase.com/cars-articles/used-car-market-booming-in-india-407483.html
CRISIL Research, Tata Nano: Impact Analysis, dated January 2008
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