The “Nano” Mess !!!

The Tata Nano was launched in March 2007 with a Lot of Hoop and hallah across all the channels as the innovation of the century. It was rated as the symbol of the growth of Modern India. But if we look at the sales figures of December 2010, the story seems to be other way round. In a year that saw the Indian auto industry growing by almost 32% (based on SIAM data), Nano's dispatches declined steadily from a high of 9,000 units in July to just 509 in December.

Now let’s analyze the reasons for the failure of the much hyped product :

•  Failure to meet the demand initially leading to huge waiting time
•  It could be the overconfident and arrogant marketing team at Tata
• Wrong Selection of Marketing strategy and marketing channel

Going into the detail, all of us are aware of what happened in Singur, but I find Tatas to be somewhere under prepared with their launch of Nano. Failing to have a mother plant already in place before going to the market seems to one of the critical reasons for such delays in delivery. They probably had a plan in place that they couldn't execute, because they just weren't ready for a whole roll out.

Secondly the Marketing team at the Tata seemed to be relaxed with the hype that the car got because of its price and the controversies that surrounded the car at all times. Initially it was the banks that were advertising and not the company. In spite of the car winning the “Car of the Year” award it was not marketed at all in any of their campaigns. Those who start with lot of buzz have to deal with the aftermath of disappointed consumers. Those who have a quieter launch are better equipped to alter the product and the plan as they go along, away from the glare of the media was quoted by a Professor of ISB which seems to be perfectly fitting in this case.

Coming to the marketing strategy the company selected online by creating a Nano website providing customized Nano, social networking websites which cater to a totally different segment of consumers as compared to what the car should have been targeted at. The positioning of the car should be a car for a small family who own a two wheeler and who hardly have frequent access to internet. For reaching such target segment marketing  should be around shops, bazaars, where they can create buzz around the car through word of mouth and demos.

The Way Ahead!!!

The company seems to be using the traditional marketing channels for the advertising which has started showing results for the company which sales rising in December 2010. The way forward for Nano is to help villagers in rural India and those at the bottom of the pyramid to get financing and make the process of buying their first car less intimidating.... Perhaps another way forward for the Nano is to get back to focusing on the people for whom the car was originally intended.

The Art of Re-Branding !!!

Change Beckons....

During the end of 2010 and coming of 2011 the country saw one of the major rebranding done in the Telecom space with Airtel having a new logo and new tagline. But 2011 seems to be bigger as far as rebranding is concerned.

New Logo

Old Logo

Bajaj Auto will go for a complete rebranding by drooping its age old family name “ Bajaj” from its products and pushing its products Pulsar and Discover as standalone bikes in the market. Similarly Hero Honda would have to go for rebranding as they have no option left after Honda opting out from the 26 year old JV recently.

This may be new to the India Market but Bajaj started the process of rebranding in the year 2007 itself with fixing its back end operations for a smooth roll-out by March 2011.

The famous “ Hamara Bajaj” will now R.I.P. The company which introduced a refreshed “Hamara Bajaj” version in 2001 with the tagline of “Badal Rahe hain Hum Yahan” was much appreciated and showcased the transformations that company was going through along with the change in the automobile industry.

The company has decided to drop the name of Bajaj from its products treading the path of major FMCG companies like Apple, HUL, Kraft food etc. The marketing success of international automotive companies like Germany’s Volkswagen or Japan’s Toyota Motor Corporation that have several brands operating as independent entities, has also attracted Bajaj.

The Indian consumer seems to be maturing with the opening up of the economy and Bajaj seems to be ahead of its Rivals, Hero Honda who will now have to shift the focus on creating a new brand identity once the Hero Honda brand is over by 2015 as per their agreement with the Honda. The Munjals have already started to focus on creating brand differentiation process for its successful bikes like Splendor and Passion but time will tell that whether the Indian consumer is ready to see their much loved Bajaj name going off the shelves, the name by which most of us has grown by and seen evolving over the years.

Now Begins the War of Water Purifiers!!!

With the Rainy season round the corner, there is a new entrant in the water purifying market. The Market leader Eureka Forbes now faces tough challenge from HUL’s Pureit which has now been launched in a new reduced size and reduced price too.

Kent has already been giving a tough fight to Aquaguard with its marketing campaigns having the Hema Malini and her daughters as the Brand Ambassadors.

The new entrant to this market is the Tata Chemicals with its water purifier Brand Swach  which is competitively priced at Rs.999/- equivalent to the HUL’s Pureit.

The most important that one needs to understand is that Eureka Forbes is also a part of the Tata Sons  and Shapoorji Pallonji Group. Tata’s launching a new brand all together against their well established brand Aquaguard seems to be little confusing. Does this signal that Tata's trying to penetrate the market particularly the rural areas with a competitive price and a Trusted Indian name ??

The one reason for this could be the highly urban image of Eureka Forbes and the sophistication that the brand carries over the years. To counter the Pureit strategy, the launch of a new brand all together under the label of a new company seems to be a very smart strategic step.

The only thing to watch would be that how Tata’s fair against the already well established Distribution Channel of HUL and this competition is worth watching..

Till then Keep Reading!!!

~Sumit Jasoria

Of the 4 P’s: Is Pricing of a product that important???

All of us are aware of the famous 4 P’s of Marketing but do we really understand the importance of all of them. Today I just want to draw your attention towards one of the Pillars of Marketing that is Price.

Price of a product/service plays a major role in its success or failure. I have several examples to substantiate the same. Let’s have a look at auto majors of the country. 

 

Maruti recently launched rather re-launched its new car Eeco. But many of the auto enthusiasts might remember that this car looks exactly similar to its earlier model Versa. Versa was priced at around 4.5 lakh ex-showroom Delhi and in spite of marketing via brand ambassador like the Bachchans the car failed miserably and price was one of the most important reasons for this. Now the same car has been re-launched with a new name and new price. Price that is quite cheaper than the earlier model, almost half of the previous one. Neither the car is endorsed by any celebrity now but the car is selling big volumes for Maruti- the Company that recently made a record of selling 1 lakh cars in a month.

 

Another example of this is the America auto major Ford. Ford launched its Fusion in India quite a few years back with a price of more than 6.5 lakh rupees and the company claimed to change the Indian automobile industry but this is India and infact the company had to change itself rather than the market. The company recently launched its new car as Figo which was quite similar to the Fusion but priced at 3.5 lakh ex-showroom Delhi which is quite less than the previous one and one can see the difference. The company is selling good volumes of the Figo in the country with reduced prices.

Coming to another automobile major Honda, the company launched its world famous hatch in India as Jazz but the company failed to do any Jazz with the launch in the already very competitive Indian automobile industry. Infact the company overpriced the car so much that the hopes of the customers got shattered hearing that price. Jazz seems to be overpriced by atleast 2 lakh rupees and if the company really wants to do some Jazz with the Jazz then they need to look at its pricing.

Now looking at the FMCG domain, Axe-the Famous HUL brand has recently reduced the price of its deos by 25 rupees and wants to change its fortunes with this price cut in the market where its market share has dropped consistently over the past few quarters. Does this mean that the Deo was overpriced or is this just a marketing gimmick?

So, to conclude I would just say that price the product/service so that people accept it. Don’t fool the customer by overpricing because a lost faith is difficult to regain and one’s loss is other’s gain.

So THINK before pricing!!!!!!

--Sumit Jasoria

That’s Called an Answer to the Competition, But isn’t it too late????

Today, I saw Coca Cola Minute Maid Nimbu Fresh. This was a total surprise for me. Being a cold drink fan and following this industry very closely, even I missed this entire affair.


Last year the competitor Pepsi launched their much hyped Nimbooz leveraging almost all methods and channels of marketing. The launch was superb and gained a huge market share for the company. Looking at that move, it was expected that Coca cola would come up with a counter strategy and make it a bigger and better launch as always expected by a dynamic company like coca cola.

Looking at the present scenario of market, Nimbooz is already having a forte in the lime juice drinks and something could dampen its market share only when the counter product is launched with a much more hype and halla. This was expected by coke but I think coke has been underplaying this and want to see the customer’s reaction towards the product. But I really feel that they need to hit hard against the competitor’s product to gain a substantial market share and until the customer is aware of the product nothing can win market share for the company.

So, Coke guys, Make your product visible.

Closing this here and opening this forum for discussion and views.

Happy Reading!!!
--Sumit Jasoria

Launching the Marketing Blog from the marketing students of FMS MBA(MS) students.

This is the first blog from the marketing students of the FMS MBA(MS) course, 2011 Batch.
After almost an year at FMS, we feel that this is the requisite platform where the management students of FMS can share their views with students of other B-schools and with the corporate world.

So Lets Start, Share and Learn !!!

Will keep you updated with the views of the students.