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.