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Marketing Success of from Tata Motors Positioning to be the Market Leader in 1mt- SCV segment Project By Soumya Prasanna Mishra

Project- Marketing Success -Tata Ace

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Page 1: Project- Marketing Success -Tata Ace

Marketing Success  of from Tata MotorsPositioning to be the Market Leader in 1mt- SCV segment

  Project BySoumya Prasanna Mishra

   

Page 2: Project- Marketing Success -Tata Ace

Contents History and Overview of the company Commercial vehicle market scenario and the players and

segmentations Innovation

Targeting Positioning Product and Salient Features Pricing  Place

Promotion Competition SWOT Analysis Variants Impact Learning

Page 3: Project- Marketing Success -Tata Ace

History and Overview>Tata Motors – making commercial and passenger vehicles since 1945.

>They have commercial vehicles, producing pickups, trucks, tractor trailers, tippers and five types of Passenger vehicles.

>Acquired in 2004 Daewoo commercial vehicle –South Korea.

>Acquired in 2008 Jaguar and Land Rover from Ford

>They have manufacturing plants in all over India.

>Strong presence in domestic as well as worldwide markets.

>Tata Motors group have become a far reaching, diverse and competitive over the past 10years.  >They are catering customers in the high-class luxury market as well as the low –class economic segment.

>Their technological prowess has proven to be the best ex- CNG vehicle, Indica,Nano Car, Ace SCV etc.

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LCV and 3 wheeler Segment

◦ Classified on Gross vehicle weight (GVW)◦ GCW<7.5tonnes – LCV◦ Goods 77% + passenger carriers 23%◦ 45% LCV + 55% M/HCV◦ Players- M&M, Eicher etc.◦ 3wheeler segment◦ Players – Bajaj, Force motors, Piaggio,

Problems◦ Fuel price- PBIT rises 3.5% for a 1% decline in fuel prices◦ Discouraging the use of old, polluting and uneconomical vehicles.◦ Supreme Court ban on overloading, Leading to incremental volumes in the last 2

yrs ◦ Scrapping vehicles >15 years old; Potentially unleash a huge replacement demand.◦ Replacement cycle- Declining from about 12 years to nearly 7 years now. The

proportion of trucks under five years of age rose from about 34% in FY02 to nearly 45% in FY06

◦ Traffic in cities, entry barriers/ timing barriers for heavy vehicles◦ Poor rural road connectivity.◦ Vehicle to be used for the last mile

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Innovation Less tonnage vehicle was absent in the market. Gap between LCV

and 3 wheelers- a 4 wheeler commercial vehicle

Market Situation

◦ Government plans of road network expansion.

◦ Higher GDP growth positively correlated with truck penetration.

◦ High probability of increased demand in LCV segment.

Company Situation

◦ Tata product portfolio lacked greater than 45tons and sub 2 ton vehicles.

◦ Scope of enhancing the market share was there

Tata decided to target the VACANT SEGMENT and launched 1MT TRUCK-ACE

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Marketing 4Ps 4Ps of TATA ACE

PRODUCT

PRICE

PLACE

PROMOTION

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TargetingTarget Segment – Individual customer

Target customer – who expects early ROI along with safety, comfort and status.◦ Three Wheeler Owners◦ Owners of trucks◦ Trucking Fleet Owners

- First time LCV purchasers> Target Place – South India and then spread

out.

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Positioning Value proposition- High performance with car like

features.

◦ Positioned as Chota Hathi◦ A symbol of power◦ A symbol of ‘mini’ product◦ A symbol of reliability

Positioning-A PRODUCT FOR ALL YOUR NEEDS and Savings

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The product Ace- - 1st Mini truck in India, commercial vehicle

look and better space utilization.

Key features- 4th wheel that upgrades Versatility

◦ Ideal for both City and rural areas.◦ Usages range from vegetable vendors to cargo pickup to

passenger transport.◦ Comfortable conditions for the driver allow the ACE to

travel over 500 kms a day, Low operating costs and highly reliable –◦ Safety

differentiation – Comfort , protect from rain, heat and cold etc. Performance - Style

◦ Styled dashboard with tray, digital clock, radio fitment provision, utility tray and clearly visible instrument cluster

◦ Smooth external finish - exquisite look◦ Flat faced large commercial vehicle look.◦ Lockable glove-box for keeping valuable documents

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Pricing◦ Product- Quality Leadership

◦ Perceived Quality higher than competing 3-wheelers

◦ Priced just beyond the max price of 3-wheelers at Rs. 200000.00

◦ Analyzing competitors costs, prices and offers

◦ Competitors sold at a lesser price than the target price of ACE

◦ The value package of Ace was however higher than the competitors

◦ The Final Price-Priced at Rs. 225000

◦ Priced at a premium of 12.5% over the maximum price of three wheelers in the market

◦ Costlier than autos used for road transport

◦ Priced higher than Maruti Omni van

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Place Place – availability of product at right place and

time

Distribution Network : Hub & Spoke Model◦ 3S to IS Approach◦ A sales outlet every 40 to 50kilometers◦ ‘Only Sales’ stores compared to traditional ‘Sales,

Services & Spares’◦ Existing dealerships acted as hubs and set up 1S

dealerships◦ Each dealer set up 15 to 20 1S stores◦ 300 new distribution points set up in 3 months◦ Location close to target market◦ Plant located in Pune at the time of launch◦ Target Markets : Southern & Western Regions

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PromotionChota Haathi / Small is bigLife ban jayegi PyareApka bharosa ka saathi

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CompetitionMahindra & Mahindra

o Maxx Maxi Truck, (payload of 900 kg)o Alfa and Champion

Force Motors Ltdo M4o Kargo King

Piaggio Vehicles India Pvt. Ltd o Piaggio Quargoo Ape Truck

Hyundai motor Indiao Porter

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SWOT AnalysisStrengths

Strong brand name of TATAFirst mover advantageGood Consumer relationshipContinuous innovationGood logistic managementProvision of finance to buyers

OpportunitiesRural marketExport SegmentHigh growth rate of LCV segmentFurther fragmentation of market

WeaknessHigher costAfter sales serviceComplaints on gear shifting

ThreatsIncreased competitionCreation of a new segment by

Mahindra & Mahindra’s GIO , Piaggio , Force Motors etc

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Variants

Launch Magic and the Winger, (Penguin)

CHANGES

o Introduce ‘stop-start’ technology

o Fuel efficiency increased by 6-10%

o Sold at a premium of Rs 10,000

o Extended as passenger vehicles and trucks.

o Equipped with 5-speed transmission

o Larger (13-inch) tyre to acquire higher speeds

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Impact

Increase sales by 13.1%

Market share increased by 13.6% points

Contributed 15 % companies volume in

1st year

Effect the market of LCV

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Learning>Rural economy is a dominant factor of Indian Economy

> Customer purchasing ACE are mainly from rural & Semi-urban area. Generally the customers buy the vehicle through Bank Loans.

> Mainly the vehicle is used for Transporting, load carrying and to move goods weighing less than 2ton.

>The vehicle is designed in such a way that it can be modified

in a passenger vehicle.

> The traders, farmers, transporters, movers use this vehicle for

transporting

The vehicle is economical & gives good mileage.

> As compared to other competitors vehicle, ACE is Economical,

Sturdy, Load Carrier & has good shape.

ACE has low maintenance.

>The income group of the customers is above 1.5lakhs.

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Thank You