Nano Marketing by Tata Motors

The Head of Car Product Group (Tata Motors), Mr. Nitin Seth spoke about the marketing strategies followed at Tata Motors for Nano during his presentation at SJMSOM, IIT Bombay. According to Nitin Seth, Tata Motors unlike other players never advertises using celebrities and it relies on trust of the people and quality of the product. Tata Nano, the most awaited product in the Indian market was endorsed with a meager budget of Rs 2 Crores. The profit margin for Nano is so less that marketing had to be done within strict budget lines. Yet, the campaign as we know proved to be highly successful. As, I could understand from the talk, the following are the strategies followed by Tata Motors marketing team:

1. Viral Marketing – The use of social networks for marketing a product has become a powerful tool. Among the social networking sites. Twitter is predominant. Tata Motors used the power of social networking to the maximum extent.
2. Retail Outlets – Tata is a conglomerate of 98 separate companies. The marketing team of Tata Motors had the Nano cars displayed at the West Side and Croma outlets leading to more vigilance and less cost.
3. Selling through SBI – Mr. Nitin Seth selected SBI over malls and other banks for the selling his Tata Nano. The reasoning behind this is malls are still seen as an upper middle class segment and Nano had a different target segment. Similar is the case with ICICI.
4. Front Page Ticker and RK Laxman – Tata Motors got the ‘News Digest’ to be renamed as ‘Nano Digest’ on the front page of Times and also got a ticker running on the front page for 10 days with a few lakhs cost. Even RK Laxman pictured Nano in his cartoons. This is a much cheaper means when compared to the Rs 50 Lakhs for a full front page ad in Times of India.
5. Nano Break – Radio stations readily agreed to the requests from Tata Motors and called their breaks Nano breaks.

The above strategies followed by Mr. Nitin Seth are indeed innovative. They created a lot of recognition for the brand. But, I believe beyond the five strategies the following has had a larger impact:

1. Cost of the car – Though Nano was never advertised as cheap car, it has been known as the Rs 1 Lakh car. The pricing of the car has played a major role in marketing the product.
2. Ratan Tata – People in India rely on Ratan Tata. The Tata’s are a part of the Indian history and share a unique bond with the people of India. Hence Ratan Tata’s word on no-compromise (quality shall be on par) car has had a huge impact.
3. Media Coverage – The relatively cheap price of Nano has attracted a large media affair. The singur incident only lead to increased vigilance for Nano. Added to this, the skepticism of lots of critics that Nano can never be launched at Rs 1 Lakh.

Mr. Nitin Seth criticized other players for using celebrities in their ads which according to him never works out. I partly agree with Mr. Nitin Seth that cars are luxurious products where impact is more on testing the product than the advertisements. We never buy a car because Shah Rukh Khan drove it. But, Shah Rukh Khan might drive half a million people to test the product. Celebrities are required to provide the initial push to the consumers. Secondly, viral networking and the internet are important tools but they hardly penetrate the Indian rural market which accounts for a greater proportion of the population. Tata Motors having the rich Indian history it has never really requires huge marketing budgets. Mr. Nitin Seth’s approach proved successful for Nano but his criticism for other automobile players is tactless. If I want to launch a car like Reva, I need brand ambassadors to take my message of the electric car through. Only then people will even consider testing the car. Indian consumer is becoming more knowledgeable and conscious with the products he purchases but I believe Celebrities (like Amitabh, Shah Rukh Khan, and Sachin) still play a role in dragging him towards the product.

Nano achieved in Rs 2 Crores what most other car players cannot achieve with a budget of Rs 10 Crores or more. But, it was not marketing that should take the entire credit. It is a combination of Tata as a historical brand, trust on Ratan Tata and Marketing.