REVVING UP!!! The Marketing Case Study

To be used only with permission from Tata Motors Ltd.

GIM, Goa 2011 To be used only with permission from Tata Motors Ltd. Page 2

It is a warm friday afternoon and Mr Jatin

Lakra was anxious and happy at the same

time while looking at the results of January

sales figures of its Multi Purpose Vehicle

(MPV) and Utility Vehicle (UV) Business.

Tata Motors just launched another product

in the Indian market named Tata Venture,

and Mr. Lakra – Branding and Marketing

Head for Venture project was uncertain

about its future. He was facing a dilemma

and was looking for a solution, which he

knew was just round the corner.

About Tata Motors

Established in 1945, Tata Motors' presence

indeed cuts across the length and breadth

of India. Over 6 million Tata vehicles ply on

Indian roads, since the first rolled out in

1954. The company's manufacturing base in

India is spread across Jamshedpur

(Jharkhand), Pune (Maharashtra), Lucknow

(Uttar Pradesh), Pantnagar (Uttarakhand),

Sanand (Gujarat) and Dharwad

(Karnataka). Following a strategic alliance

with Fiat in 2005, it has set up an industrial

joint venture with Fiat Group Automobiles

at Ranjangaon (Maharashtra) to produce

both Fiat and Tata cars and Fiat

powertrains. The company is establishing a

new plant at Sanand (Gujarat). The

company's dealership, sales, services and

spare parts network comprises over 3500

touch points; Tata Motors also distributes

and markets Fiat branded cars in India.

Tata Motors, the first company from India's

engineering sector to be listed in the New

York Stock Exchange (September 2004),

has also emerged as an international

automobile company. Through subsidiaries

and associate companies, Tata Motors has

operations in the UK, South Korea,

Thailand and Spain. Among them is Jaguar

Land Rover, a business comprising the two

iconic British brands that was acquired in

2008. In 2004, it acquired the Daewoo

Commercial Vehicles Company, South

Korea's second largest truck maker. The

rechristened Tata Daewoo Commercial

Vehicles Company has launched several

new products in the Korean market, while

also exporting these products to several

international markets. Today two-thirds of

heavy commercial vehicle exports out of

South Korea are from Tata Daewoo. In

2005, Tata Motors acquired a 21% stake in

Hispano Carrocera, a reputed Spanish bus

and coach manufacturer, and subsequently

the remaining stake in 2009. Hispano's

presence is being expanded in other

markets. In 2006, Tata Motors formed a

joint venture with the Brazil-based

Marcopolo, a global leader in body-building

for buses and coaches to manufacture

fully-built buses and coaches for India and

select international markets. In 2006, Tata

Motors entered into joint venture with

Thonburi Automotive Assembly Plant

Company of Thailand to manufacture and

market the company's pickup vehicles in

Thailand. The new plant of Tata Motors

(Thailand) has begun production of the

Xenon pickup truck, with the Xenon having

been launched in Thailand in 2008.

Tata Motors is also expanding its

international footprint, established through

exports since 1961. The company's

commercial and passenger vehicles are

already being marketed in several

countries in Europe, Africa, the Middle

East, South East Asia, South Asia and South

America. It has franchisee/joint venture

assembly operations in Kenya, Bangladesh,

Ukraine, Russia, Senegal and South Africa.

GIM, Goa 2011 To be used only with permission from Tata Motors Ltd. Page 3

Tata Motors garnered consolidated revenues of Rs. 92,519 crores (USD 20 Billion) in 2009-2010. The company showed robust growth in both the business units- Passenger Car Business Unit (PCBU) and Commercial Vehicle Business Unit (CVBU) (Annexure-I)

Stable economic environment, robust IIP, liquidity, availability of financing were the main drivers of growth in the domestic CV market. Growth in PCBU was particularly driven by new launches and relatively young Product portfolio (Annexure-II)

Tata Venture

The Tata Venture was borne out of Tata

Motors’ rigorous market research team

which highlighted that there was an

opportunity to capture a substantial

segment of typical Middle Class Indian

Family. This segment is profiled as follows:

• Has a family of >5 members

• Has a need of driving a car in both

city and rough-road conditions

• Is looking for a vehicle which can

be used for both personal as well as

business usage

• Has a substantial amount of

everyday driving

• Wants a comfortable, spacious and

fuel efficient low cost option

This segment is currently targeted with the

following type of vehicles:

• UV

• Hatch Backs

• Vans

While these three segments of vehicles

have been instrumental in fulfilling certain

needs, there was still no vehicle in the

market which could offer advantages of all

3 segments. (Annexure III)

On the basis of the market research and

Tata Motors New Product Initiation

function’s support, Tata Venture was

designed to cater to the aforementioned

Indian Family. (Annexure IV)

Tata Venture Product Features

Tata Venture is a multi-purpose vehicle

(MPV) with the footprint and

maneuverability of a hatchback car, but

the interior space of a utility vehicle.

The less than 4 metre long Tata Venture

can comfortably accommodate eight

passengers in three front facing rows and

has ample luggage space. A glasshouse

effect with plug-in windows for second row

passengers contributes to the distinctive

exterior design while the contemporary

interiors sport a two-tone beige and black

theme. Comfort and convenience of both

driver and passengers have been

adequately addressed with dual HVAC,

power steering, power windows, reverse

parking aid, keyless entry with engine

immobiliser and rear wipers.

A semi monocoque construction provides

GIM, Goa 2011 To be used only with permission from Tata Motors Ltd. Page 4

the required rigidity while the robust shell

has energy absorbing crumple zones built

in. A collapsible steering and side impact

beams protect occupants in an exigency.

The Tata Venture meets crash safety norms

applicable in the domestic market.

The Tata Venture is powered by a 1.4 Litre

turbo diesel engine, delivering 71 PS

power, with best in class fuel efficiency

among diesel MPVs in the country. The

mileage as certified by ARAI is 15.42 kmpl.

The Tata Venture is available in 5, 7 and 8-

seater options in 3 row front facing

configuration and will be available in a

range of 5 colors and 3 trim levels.

(Annexure V)

Price, Place and Promotion

The Tata Venture is priced in the range of

Rs. 4.05 lakhs and Rs. 5.07 lakhs (ex-

showroom Jaipur).

While the product Venture seems almost

too perfect to be true, Tata Motors

conducted initial tests and pilot studies

and launched the vehicle on 6th Jan 2011.

It was decided that the Tata Venture would

be distributed through both CVBU and

PCBU dealerships to utilize the wide reach

of Tata dealership network.

Venture was launched in Rajasthan and

Maharashtra in the first phase with the

tagline “Bade dil wala”. The product was

launched in three variants (Annexure VI)

The dilemma

As Jatin pondered over the January market

shares of MPV(Annexure VII),A2

segment(Annexure VIII) and UV (Annexure

IX) he felt unsure about Venture’s future.

Certain questions started beginning to

emerge, as he listed down his thoughts on

a piece of paper.

1. What should be the marketing

strategy for the next one year for

Venture? Should the vehicle be

launched on a pan India level or

state by state?

2. What is the potential of the MPV

segment and how is competition

shaping up?

3. What are the different

trade/customer schemes that can

be offered with Venture to make it

a successful product?

4. Is “Bade dil Wala” capturing the

essence of Tata Venture or do we

need a facelift?

GIM, Goa 2011 To be used only with permission from Tata Motors Ltd. Page 5

ANNEXURE I

ANNEXURE II

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ANNEXURE IV

ANNEXURE III

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ANNEXURE V

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ANNEXURE VI

ANNEXURE VII

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Sales Average Growth over

Jan-10 Dec-10 Apr'10-Jan'11 per month Apr'09-Jan'10

A2 Segment

Alto 33,118 57.2% 20.2% 275,760 27,576 39.3% 23.46% 20.82% 20.83% 235,212

Wagon R 14,186 11.0% 8.2% 134,003 13,400 10.8% 11.40% 12.83% 12.83% 144,898

Swift 11,353 -1.8% 5.2% 117,812 11,781 28.6% 10.02% 10.28% 10.29% 116,174

Ritz 6,046 -2.1% 22.9% 56,808 5,681 9.9% 4.83% 5.59% 5.59% 63,096

Zen / Zen Estilo 3,652 -8.9% 17.8% 43,316 4,332 43.5% 3.69% 3.68% 3.69% 41,624

A Star 4,124 39.9% 19.1% 30,303 3,030 18.5% 2.58% 2.85% 2.85% 32,186

Suzuki Total 72,479 23.8% 14.8% 658,002 65,800 27.0% 55.99% 56.05% 56.08% 633,190

I-10 16,694 17.2% 35.4% 132,540 13,254 10.3% 11.28% 13.21% 13.22% 149,242

Santro 4,648 -42.6% -1.8% 66,875 6,688 -2.8% 5.69% 7.64% 7.64% 86,272

I-20 5,773 42.7% 21.8% 64,156 6,416 96.1% 5.46% 3.73% 3.73% 42,128

Getz - -100.0% - 62 6 -98.9% 0.01% 0.57% 0.57% 6,467

Hyundai Total 27,115 0.6% 20.9% 263,633 26,363 16.1% 22.43% 25.15% 25.16% 284,109

Indica Vista 7,666 -7.4% 75.3% 49,920 4,992 -3.3% 4.25% 5.88% 5.88% 66,383

Indica 2,925 -7.8% -62.2% 30,950 3,095 -22.0% 2.63% 4.25% 4.25% 48,039

TATA Total 10,591 -7.5% -3.5% 80,870 8,087 -11.4% 6.88% 10.13% 10.13% 114,422

Ford Figo 8,616 - 191.4% 61,307 6,131 - 5.22% 0.65% 0.65% 7,316

Ford Fusion - - - - 0 -100.0% 0.00% 0.05% 0.05% 517

Ford Total 8,616 - 191.4% 61,307 6,131 11758.2% 5.22% 0.69% 0.69% 7,833

CHevy Spark 3,267 -5.2% 3.6% 28,315 2,832 -20.5% 2.41% 3.74% 3.74% 42,240

Beat 3,338 18.2% 1.2% 27,847 2,785 655.9% 2.37% 1.12% 1.12% 12,614

Aveo u-Va 331 -22.7% 7.5% 3,153 315 -40.3% 0.27% 0.54% 0.54% 6,138

GM Total 6,936 3.5% 2.7% 59,315 5,932 33.0% 5.05% 5.40% 5.40% 60,992

Grande Punto 1,203 -4.1% 1027.4% 9,713 971 -11.1% 0.83% 1.18% 1.18% 13,281

Palio 24 1100.0% 0.0% 175 18 -48.5% 0.01% 0.03% 0.03% 342

F500 - - -100.0% 1 0 -95.8% 0.00% 0.00% 0.00% 29

Uno - - - - 0 - 0.00% 0.00% 0.00% -

Fiat Total 1,227 -2.3% 739.5% 9,889 989 -12.4% 0.84% 1.21% 1.21% 13,652

Nissan Micra 1,784 - -0.5% 8,235 824 - 0.70% 0.00% 0.00% -

Skoda Fabia 1,460 83.9% -47.7% 7,982 798 57.8% 0.68% 0.58% 0.58% 6,501

Honda Jazz 579 18.2% 22.7% 4,310 431 -36.0% 0.37% 0.67% 0.67% 7,541

VW Polo 3,023 - -16.2% 21,720 2,172 - 1.85% 0.06% 0.06% 698

San Storm 20 0.0% 0.0% 200 20 0.0% 0.02% 0.02% 0.02% 240

Total 133,830 26.0% 16.3% 1,175,463 117,546 29.9% 100.0% 100.0% 100.0% 1,129,178

MODEL/MAKE WISE A2 SEGMENT SALES AND SHARES

Brand Jan-11% Growth Over Market Share

Apr'10-Jan'11

Market Share

Apr'09-Jan'10

Market Share 09-

10Sales 09-10

ANNEXURE VIII

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ANNEXURE VII (CONT.)

Sales Average Growth over

Jan-10 Dec-10 Apr'10-Jan'11 per month Apr'09-Jan'10

Bolero 8,463 22.4% -17.1% 67,729 6,773 17.2% 25.75% 26.44% 25.90% 70,511

Scorpio 4,300 21.2% -17.1% 35,319 3,532 15.9% 13.43% 13.93% 13.37% 36,407

Xylo 2,733 17.1% -19.9% 27,124 2,712 19.1% 10.31% 10.41% 10.28% 27,978

Commander / MarsIall388 -60.1% -82.1% 4,814 481 -29.5% 1.83% 3.12% 3.21% 8,752

Jeeps 200 -69.2% -27.4% 3,576 358 -36.4% 1.36% 2.57% 2.54% 6,906

Getaway 4 -20.0% -72.0% 52 5 -3.7% 0.02% 0.02% 0.02% 64

M&M Total 16,088 11.5% -22.2% 138,614 13,861 12.2% 52.70% 56.51% 55.32% 150,618

Innova 5,284 27.8% -12.3% 43,655 4,366 13.4% 16.60% 17.61% 17.37% 47,294

Fortuner 1,103 22.1% -6.8% 10,025 1,003 138.0% 3.81% 1.93% 2.31% 6,280

Prado 3 200.0% 85.7% 157 16 406.5% 0.06% 0.01% 0.02% 63

LC 200 1 -50.0% -60.0% 60 6 9.1% 0.02% 0.03% 0.02% 66

Toyota Total 6,391 26.8% -11.2% 53,897 5,390 25.9% 20.49% 19.58% 19.72% 53,703

Sumo 1,691 22.2% 9.4% 14,073 1,407 5.0% 5.35% 6.13% 6.34% 17,262

Safari 1,776 45.9% 19.1% 12,190 1,219 54.2% 4.63% 3.61% 3.80% 10,352

Sumo Grande 496 -46.8% 25.1% 5,082 508 20.7% 1.93% 1.93% 2.13% 5,787

Aria 321 - -13.5% 1,233 123 - 0.47% 0.00% 0.00% 5

Xenon 20 300.0% 85.7% 96 10 -17.9% 0.04% 0.05% 0.05% 125

TATA Total 4,304 21.7% 12.6% 32,674 3,267 27.5% 12.42% 11.72% 12.31% 33,531

Tavera 1,691 11.8% -12.9% 15,382 1,538 26.8% 5.85% 4.64% 5.65% 15,380

Captiva 91 26.4% -16.7% 1,379 138 49.2% 0.52% 0.35% 0.41% 1,124

Forester - - - - 0 - 0.00% 0.00% 0.00% -

GM Total 1,782 12.5% -13.1% 16,761 1,676 28.4% 6.37% 5.00% 6.06% 16,504

Force Trax (exclu Pickups)937 39.2% -35.6% 6,779 678 38.7% 2.58% 2.24% 2.33% 6,349

Gypsy 191 41.5% -26.1% 4,813 481 65.9% 1.83% 1.33% 1.41% 3,841

Grand Vitara 1 - -33.3% 77 8 11.6% 0.03% 0.03% 0.03% 91

Suzuki Total 192 42.2% -26.3% 4,890 489 64.6% 1.86% 1.36% 1.44% 3,932

Ford Endeavour 351 0.0% 86.0% 2,475 248 34.9% 0.94% 0.84% 0.95% 2,598

Outlander 65 58.5% 19.3% 1,059 106 250.7% 0.40% 0.14% 0.15% 412

Pajero 124 96.8% -25.2% 1,001 100 5.7% 0.38% 0.43% 0.44% 1,204

Montero 15 114.3% -50.0% 57 6 26.7% 0.02% 0.02% 0.02% 56

Trekkar - - - - 0 - 0.00% 0.00% 0.00% -

Mitsubishi Total 204 83.8% -13.0% 2,117 212 63.6% 0.80% 0.59% 0.61% 1,672

Audi Q7 50 -13.8% 50.0% 459 46 13.9% 0.17% 0.18% 0.18% 496

Audi Q5 18 -67.9% 213.3% 427 43 90.6% 0.16% 0.10% 0.11% 297

Audi Total 68 -40.4% 88.9% 886 89 41.3% 0.34% 0.29% 0.29% 793

Skoda Yeti 344 - 64.3% 750 75 - 0.29% 0.00% 0.00% -

ICML Rhino 65 -16.7% 25.0% 649 65 -28.4% 0.25% 0.41% 0.37% 1,014

M-CLASS 125 - -69.1% 248 25 - 0.09% 0.00% 0.00% -

GL-CLASS 20 - -4.8% 213 21 - 0.08% 0.00% 0.00% 12

R-CLASS 20 - -58.3% 53 5 - 0.02% 0.00% 0.00% -

ML-CLASS 1 - 200.0% 35 4 600.0% 0.01% 0.00% 0.00% 5

Daimler Chrysler Total166 - -49.6% 549 55 10880.0% 0.21% 0.00% 0.01% 17

Honda CRV 38 -50.0% 34.6% 435 44 55.9% 0.17% 0.13% 0.17% 474

Nissan X-Trail 49 0.0% 3.2% 412 41 235.0% 0.16% 0.06% 0.08% 212

Rangerover Sport 20 0.0% 9.1% 141 14 291.7% 0.05% 0.01% 0.02% 45

Rangerover 11 57.1% -29.4% 103 10 255.2% 0.04% 0.01% 0.02% 52

Freelander 6 -14.3% 80.0% 92 9 178.8% 0.03% 0.01% 0.02% 61

Discovery 3 50.0% -11.1% 44 4 633.3% 0.02% 0.00% 0.01% 15

Landrover Total 40 11.1% -2.4% 380 38 265.4% 0.14% 0.05% 0.06% 173

X5 10 400.0% 84.6% 186 19 -24.1% 0.07% 0.09% 0.10% 266

X6 10 42.9% 45.5% 142 14 57.8% 0.05% 0.03% 0.04% 115

X3 5 -28.6% -50.0% 27 3 -61.4% 0.01% 0.03% 0.03% 76

X1 - - - 17 2 - 0.01% 0.00% 0.00% -

BMW Total 25 56.3% 110.7% 372 37 -8.1% 0.14% 0.19% 0.17% 457

Santa Fe 5 - -61.8% 220 22 - 0.08% 0.00% 0.00% -

Tucson - - - - 0 -100.0% 0.00% 0.01% 0.01% 14

Hyundai Total 5 - -61.8% 220 22 - 0.08% 0.01% 0.01% 14

Porche Cayenne 34 580.0% -66.7% 103 10 71.7% 0.04% 0.02% 0.03% 72

Volvo XC-90 35 400.0% 0.0% 73 7 97.3% 0.03% 0.01% 0.02% 56

VW Touareg - -100.0% - 3 0 -94.2% 0.00% 0.02% 0.03% 91

Premier Rio - - - - - - 0.00% 0.00% 0.00% -

Total 31,118 18.8% -15.1% 263,039 26,304 20.3% 100.0% 100.0% 100.0% 272,280

Sales 09-

10Brand Jan-11

% Growth Over Market

Share

Apr'10-

Market

Share

Apr'09-

Market

Share 09-

10

ANNEXURE IX