WIZBIZ 20XI

Revving Up!!!
A Case Study Competition

Team: Force One

Kapil Verma Krishan C Pandey Avinash Vishwakarma

Email- Email- Email-

kapil.nitie@gmail.com kcpandey1987@gmail.com avinash.nitie@gmail.com

Course – PGDIE Course – PGDIE Course – PGDIE

Phone No - 9619084951 Phone No - 9769657887 Phone No - 9769861688

2011
National Institute of Industrial Engineering,

Vihar Lake,

Mumbai-400087

PGDIE40, NATIONAL INSTITUTE OF INDUSTRIAL ENGINEERING, MUMBAI

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

Index
1. Executive Summary…………………............................................................................ 3

2. Market Analysis............................................................................................................... 4

3. MPV Market segment India…………………………………………………………... 6

4. Demand Determinants and its correlation with Tata Venture…………………….. 8

5. Marketing strategy for the next one year for Venture…………………………… 10

6. Should the vehicle be launched on a pan India level or state by state? …………. 15

7. Trade/customer schemes that can be offered with Venture to make it a successful

product? …………………16

8. Is “Bade dil Wala” capturing the essence of Tata Venture or do we need a facelift?.
………….. 17
9. References ………………………………………………………………………….18

Team Force One Page 2

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

EXECUTIVE SUMMARY

We aimed at revving up the branding of TATA Venture so as to make the customers feel about
its incomparable value that no any car holds as of now. In this report we have tackled the various
issues relating to marketing strategy, potential, brand image creation and lucrative schemes
keeping focus on both short term and long term benefits. We did both primary and secondary
survey to analyze different segment of cars. Innovative schemes and strategies are being
developed according to the present car buying trends.
As the competition is changing from oligopolistic to monopolistic market, we have stick to the
theory of constraints by taking a leap in after sales servicing.
Pan India launch has been recommended because of the availability of strong dealership network
and growth of MPV segment. A strong emphasis is given on the social marketing campaign.
A revamp is suggested for the brand facelift with the tagline as “No Samjhauta”
depicting the demand side attraction in contrast with “Bade Dilwala” which is from the supply
side. By and large, our quantitative and qualitative analysis is envisaging a bright future of
TATA Venture.

Team Force One Page 3

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

MARKET ANALYSIS

TATA
Venture

As seen in the graph below, there has been robust growth across the commercial and passenger
vehicle segment across the years except the year 2008-09. On the other hand looking at the
market share of Tata Venture, it’s just 0.09% in the MPV segment. Tata Venture hence clearly
lies in the question mark segment of the BCG matrix.

Team Force One Page 4

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

Source: SIAM (Society of Indian Automobile Manufacturers)

Source: SIAM (Society of Indian Automobile Manufacturers)

Team Force One Page 5

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

Source: Annexure VII

To penetrate the market, the move must be made towards the star segment now i.e. to increase
the sales keeping the profit margin low. The initial launch price must be kept minimal.

The sales of Maruti Versa rose substantially as seen from Annexure VII which was due to their
campaign “The joy of travelling together” and relative lower cost.

MPV Market segment India

Maruti Suzuki, Tata Motors, Toyota, Nissan and Ford, all plan to enter the mini MPV or
multi-purpose vehicle segment. New cars are soon expected in the segment. It is the aggressive
pricing and volume sales to step up investments in this segment which was until now unexplored
and but likely to be crowded soon.

Car makers hope to give the mini MPVs

car-like refinement, making them 7-8
seaters. Also, pricing the vehicles
competitively is sure to bring in volume
sales. Car makers aim to allure the fat
Indian families with these launches. The
mini MPVs will best suit such families that

Team Force One Page 6

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

want a different vehicle with enhanced fuel economy.

Experts feel that it is best to bring in a product in a segment that has not yet developed as a
category and lacks competition. The chances of exploration are higher. As of now, car makers
see profits trickling from such a venture. The Society of Indian Automobile Manufacturers
(SIAM) has reported that the sales of MPVs have increased by 50.43 percent to 1, 19, 377 units
during January to September 2010 period when compared to a year ago period. If the company
manages to innovatively package the product, it could insure volume sales. A senior official of a
Mumbai-based car company said, “The mini MPV segment will help auto companies to improve
margins and lessen their dependence on core products”.

Maruti Suzuki has already entered the segment with its Omni and Eeco. These are priced in Rs 2-
3 Lakh range. Analysts say the scaled down versions of MPVs may be priced around Rs 5 to 6
Lakh. If priced right, we can expect the mini MPVs to be the next big thing in the great Indian
car industry.

Speculation says Japanese auto major Toyota will be launching its Avanza, a mini MPV in India
pretty soon. To be positioned below the Toyota Innova, the new car is likely to drive
considerable volumes for the company. However, deputy MD of Toyota Kirloskar Sandeep
Singh said the current plan for the company will be to focus on the hatchback and sedan on the
Etios platform.
India’s largest car maker, Maruti Suzuki in also in turn to launch a developed new mini MPVs.
Christened Concept RIII, Maruti is likely to build it on an entirely new platform. Nissan and
Ford may most likely develop the mini MPV on the Micra and Fiesta platform, respectively.
Statistical Analysis for MPV segment
Annexure VII clearly depicts growth in MPV segment in the market with total sales increasing
by around 17% during 2010-2011. Till present MUL had 100% market share in the multi-
purpose vehicle segment. 1,32,674 MPV segment vehicles were sold during April 10-Jan 11.
Although, the market share of MPV segment is low in the automobile industry, it is under one
umbrella i.e.Maruti Suzuki India Ltd.

Team Force One Page 7

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

As shown in the graph below, Maruti Versa increased its market share substantially from 2010-
2011. The possible reasons for the same as found from the market survey came out to be new
marketing campaign “The joy of travelling together” and no competitor in the similar segment.
This clearly shows that marketing campaign is going to play a big role in the sales of vehicle.

Source: Annexure VII

DEMAND DETERMINANTS AND ITS CORRELATION WITH TATA VENTURE

Determinants of demand for this industry include vehicle prices, preferences, the running cost of
a vehicle (mainly determined by the price of petrol), income, interest rates, scrapping rates, and
product innovation.

Team Force One Page 8

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

Product Innovation and new to market: is an important determinant as it allows better models
to be available each year and is a critical success factor for enhancing sales volume. In the four
wheeler car segment the new cars always have an edge if they come up with aggressive
marketing.

The note above depicts that on being new and innovative in the market, the sales volume can be
substantially increased with low profit margin and aggressive marketing. Tata being the first in
MPV segment with diesel engine holds an edge.
Affordability: Movement in income and interest rates determine the affordability of new motor
vehicles. India’s per capita income has increased by 17.3% since last year. Moreover, if we look
at the cars in the range from 4 lakhs to 5.5 lakhs in Annexure VIII there has been robust increase
in sales. Tata Venture is rightly priced at Rs. 4 lakhs to 5 lakhs. Although it faces competition
with Maruti Omni and Eeco at lower prices in market, the add features it holds are affordable at
asked price.
Demographics: It is evident that high population of India has been one of the major reasons for
large size of automobile industry in India. Factors that may be augment demand include rising
population and an increasing proportion of young persons in the population that will be more
inclined to use and replace cars. Tata Venture is rightly placed to capture such demographics.
Maruti Versa with the marketing strategy “The joy of travelling together” could tap the market
recently.
Infrastructure: Longer-term determinants of demand include development in Indian’s
infrastructure. India’s banking giant State Bank of India and Australia’s Macquarie Group has
launched an infrastructure fund to rise up to USD 3 billion for infrastructure improvements.
India needs about $500 billion to repair its infrastructure such as ports, roads, and power units.
These investments are been made with an aim to generate long-term cash flow from automobile,
power, and telecom industries. (Source: Silicon India)
Price of Petrol: Movement in oil prices also have an impact on demand for large cars in India.
During periods of high fuel cost as experienced in 2007 and first –half of 2008, demand for large

Team Force One Page 9

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

cars declined in favour of smaller, more fuel efficient vehicles. The changing patterns in
customer preferences for smaller more fuel efficient vehicles led to the launch of Tata Motor’s
Nano – one of world’s smallest and cheapest cars. Tata Venture having diesel engine captures
this characteristic effectively. It may be easily presented as the car saving Rs. 1000/- per day
compared to other cars in the similar segment.

MARKETING STRATEGY FOR THE NEXT ONE YEAR FOR VENTURE

Marketing has been an important success factor in the sales of four wheeler market segment.
Tata Venture primarily aims at the upper middle class and the business oriented segment. It
explores a new market which was till now dominated by Maruti Suzuki India Ltd..

Team Force One Page 10

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

Key target buyer

One with a family of more than 5 members

One who needs driving a car in both city and rough-road conditions
One who is looking for a vehicle which can be used for both personal as well as business
usage
One who has a substantial amount of everyday driving
One who wants a comfortable, spacious and fuel efficient low cost option
Corporate offices and communities will find it useful for daily travel of their employees and
school children

Market Segment

Team Force One Page 11

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

Distribution Channels

Tata Venture has been distributed through both CVBU and PCBU dealerships (24 dealers)
Utilization of wide reach of Tata dealership network

Product Positioning

Existing Product New Product

Tata
Existing Market

Venture
Market Product
Penetration Development
New Market

Market
Development Diversificatio
n

Tata Venture must give scope for customization. Present market is customer driven and
Diversificatio
customization plays a major colour. With the three variants developed TATA Venture may
n
further give scope for the customers to choose their own colours and optional features with

Team Force One Page 12

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

added cost and a liitle more lead time. This gives satisfaction to the buyer and would reduce the
supply chain costs.

Against or Away from a Competitor?

Generally every car maker focuses on the above said three segments separately but TATA
Venture came up with an innovation to attract every segment of the car buyers which will
increase the number of buyers as a whole. It is away from the competitor in the uniqueness of its
multiple features and against the competitor in selecting the segments.

The target market

Price vs Competition
The cost of fuel keeps people with two-wheelers from buying cars
Price rise is being envisaged to increase in coming years
Market is oligopoly in India and is going to be monopolistic in coming years as other players
are going to launch the same type of cars
As GDP is growing, the buying power is increasing.

Advertisement
“Jo dikhta hai wo bikta hai”, Presently, Tata Venture has very low visibility

Team Force One Page 13

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

The tag line proposed for Tata Venture is “No Samjhota” i.e. no compromise which clearly
fits with Tata Venture. It never compromises either with space, quality , features or price.
Furthermore the tag line proposes the decision from the demand side. “Bada Dil Wala” is a
quote from the supply side but “no samjhota” connects to the customers and they are at
deciding end then
It is proposed to have pan India launch where electronic media will have more effect than
print media. Following are some of the points where from the messages would reach faster
to the public.

In popular TV serials and movies: Inspite of spending heavily in the direct advertisements
indirect advertisements would prove relatively low
cost and effective. For e.g. if Tata Venture is
shown in a movie or a popular TV serial with
whole family and then a comment is passed in
facebook that the vehicle shown was Tata Venture,
it would help in viral marketing. Hence if social
media attached with electronic media will give
efficient advertising for the product.

Team Force One Page 14

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

During School events: The school events may be sponsored and will increase the visibility of
Tata venture. Especially in Tier 2 and Tier 3 cities, the
students of 3 to 4 families go together in cars. Businessmen
coming to see the events by children will be target audience.
Sponsoring school events is also less costly rather than
corporate and college events eg. debates, fancy dress
competition.
During festivals and marriages: The car may be projected
as “Shubh Aarambh” for a new life for the groom and bride.
This might excel the sales volume of Tata Venture.
Auto Expo: It is always the best platform where people
come with the intention of knowing the new launches and
such occasions may be fully utilized.

Facebook and social forums: There are lot of discussions

done on social sites and the platform must be utilized for
marketing of Tata Venture. If a case study to make a facebook page and advertise Tata Venture
is opened out, it would bear thousands of viewers for the same. Presently, there are only 33 likes
in Facebook for Tata Venture.
Brand image: Brand image is one of the success factors for any automobile in the market.
Hence, all the advertises and promotion must emphasize “A TATA product” at the end.
After sales service: Bain & Co. surveyed more than 1,800 customers who had purchased all the
automotive brands sold in the U.S., to better understand their ownership and sales experience and
to assess their brand loyalty. Owners were asked to rate, on a scale of zero to 10, how likely they
were to recommend their vehicle to a friend or colleague. By subtracting the percentage of
"detractors" who gave scores between zero and 6, from the percentage of "promoters" who gave
a score of 9 or 10, we can calculate a "Net Promoter Score" (NPS). NPS is already used in
dozens of industries to determine how deep loyalty to a particular company runs among its
customers, and how it stacks up against its competitors when it comes to customer loyalty.

Automakers have opportunities to improve their business performance in the short term by
focusing more on the customers they already have. Especially in these tough times for the
industry, one of the most powerful techniques for converting buyers into die-hard fans is
providing exceptional after-sales service. Since the competition shall soon shape up in the market
in MPV segment, after sales service, showroom service, clear explanation about the car,
accessories shall play major role

Team Force One Page 15

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

Should the vehicle be launched on a pan India level or state by state?

The vehicle if launched on pan India level perceives to give more ROI(Return on Investments).
From the discussions above, it can be clearly made out that there are many competitors for Tata
Venture in the recent future and then the condition might turn to cash cow of BCG matrix. All
the companies are aiming at the MPV segment. Hence, Tata Venture must go up with a pan India
launch increasing its visibility. Aggressive marketing is a “must” for the four wheelers at present
scenario in India.

Looking at Ford Figo being new to market attained a

growth in market share by 5%, the maximum in the list of
Annexure VIII. Scorpio, Pulsar are the examples which
targeted their segment specifically and came up with
aggressive marketing all over India. Micromax is another
such example which targeted high battery backup an d came
up with pan India launch.

Since, the product is new in the segment and there

are many competitors nearing their launch, the strategy to capture the market share giving a new
direction to the public to think in.

On surveying the social sites for the opinion of public, following was a comment that was seen
on several forums:

Team Force One Page 16

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

Further, pan India launch would increase the sales to high volume which would then reduce the
marketing cost per unit for Tata Venture. The rugged distribution system of Tata Venture
supports the same and It must be utilized.

Trade/customer schemes that can be offered with Venture to make it a successful

product?

Team Force One Page 17

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

Team Force One Page 18

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

Is “Bade dil Wala” capturing the essence of Tata Venture or do we need a

facelift?
We suggest “No Samjhota” as new tagline for Tata Venture. Its main competitor is Maruti Omni
and it comes for a relatively low cost. On asking several students at NITIE in the age group of
26-32 years, it was found that the image of Omni is a carrier van and sometimes used for
travelling. The front part of Tata Venture is flat and hence it also seemed the same to the once on
first sight to the people we surveyed. This means we need to project Tata Venture more as stylish
option for long travel with family as Maruti Versa.
Furthermore, Bade dil Wala represents the characteristics of supply side i.e. what Vehicle is
giving them. Whereas “No Samjhota” represents the demand sides and would suit more to the
customers. “No Samjhota” may be presented as the customers need not compromise with space,
price, style, fuel cost, bad road driving. It would give them all they ask for at one platform.
Additionally due to several new cars coming in the market, it would be a new direction of
thought for the audience. All the companies focus on some of their qualities in their
advertisements. This would be all in one at reasonable cost.

Team Force One Page 19

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

Reference
[1]. http://www.indiandrives.com/

[2]. http://www.just-auto.com

[3]. Sector Report, Four Wheeler Industry, DBS Cholemandalam

[4]. http://www.imaginmor.com/automobileindustryindia.html

[5]. Domestic Sales Trend, SIAM

[6]. Economic Trends, NCAER

[7]. http://archive.autocarindia.com/

[8]. http://www.team-bhp.com/

[10]. http://www.infibeam.com

[11]. http://www.carblogindia.com

[12]. http://www.iloveindia.com/cars/automobile-loans/index.htm

[13]. www.maxi-pedia.com/BCG

[14]. http://en.wikipedia.org

[15]. http://www.tatamotors.com/dealer-locator-

[16]. http://trak.in/

Team Force One Page 20

National Institute Of Industrial Engineering, Mumbai REVVING Up!!! at WIZBIZ, 2011

Team Force One Page 21