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					                     MARKETING REPORT



                STUDY OF TATA MOTORS AND
                  MAHINDRA & MAHINDRA




Guide:                                   Presented by:
Dr. Zillur Rahman                       Anmol Sahu
Department of Management Studies        Dhiraj Mittal
IIT Roorkee.                            Jamshid A A
                                        Ritesh Agrawal
Marketing Management




                       ACKNOWLEDGEMENT



This is a Project done as a part of our Marketing Course in 1st Semester. The two
companies, TATA Motors and Mahindra & Mahindra, have been analyzed without any
bias. The source of information has been mentioned in the references section.


We would like to thank our guide, Dr. Zillur Rahman, for all his help and support. We
would also like to thank the officials of TATA’s and Mahindra for extending help on the
same.


The information mentioned in this report is correct and from confirmed sources. To the
best of our knowledge the information present in authentic.




                                                                     From:
                                                                     Anmol Sahu
                                                                     Dhiraj Mittal
                                                                     Jamshid A A
                                                                     Ritesh Agrawal




                                    -2-                             TATA & Mahindra
Marketing Management


INTRODUCTION:

Mahindra & Mahindra (M&M):
When India got independence, the Prime Minister of India had a vision of making India
self-resilient. The vision also included making the army strong for which they needed
tough, rugged and cheap off-roaders. That’s the time when M&M’s automotive division
was formed to manufacture utility vehicles for the Indian market, initially by importing
and assembling Willys Jeep kits. At that time the entire production was for the army.
Around 1965 the company started manufacturing Light Commercial Vehicles (LCV) for
commercial use.
M&M's automotive division is in the business of serving people’s needs of travel and
transport of load by manufacturing and marketing utility vehicles and LCV’s. M&M is
the leader in this segment, with a market share in excess of 50 per cent. The M&M brand
symbolizes ruggedness, durability, reliability, easy maintainability and operational
economy, delivering to the customer value for money.


TATA Motors:
TATA’s is one of the most admired business houses of India. It has been cashing on its
brand name from the pre-independence era. It’s said that J R D Tata is the initiator of
Manufacturing Revolution in India. He had a vision, which TATA’s has maintained over
its long enriched history.
TATA’s entered the MUV (Multi Utility Vehicle) segment in the year 1995. The MUV
segment witnessed an expansion in FY99 with TATA introducing a sports utility vehicle.
TATA’s had been the first mover in the SUV (Sports Utility Vehicle) segment and has
cashed big time on this advantage.




                                     -3-                           TATA & Mahindra
Marketing Management




UPPER HAND:

Mahindra & Mahindra (M&M):
       Low manufacturing cost through BPR (Business Process Re-engineering) and
        PCE (Process Centric Enterprise).
       State of the art manufacturing facilities with high level of vertical integration.
       A strong dealer network of over 275 dealers supervised by 20 sales offices,
        supported by 18 Area Offices.
       After sales service is provided by a network of authorized service stations across
        the country, which meet customer needs for servicing and genuine spare parts.
       Strong emphasis given on innovation and up gradation through strong Research &
        Development
       Belief in quality processes. Manufacturing plants have undergone certification
        like QS 9000, ISO 9001:1994, ISO 14001 and TS 16949 certification.


Four Fold Strategy:

       Creating Strong Brands: M&M will be positioning each brand uniquely to
        target various spectrum of the market.


       3 Brands                Bolero                  MaXX                    Scorpio
    Positioning              BreakFree                 Zyaada                   Carplus


       Provide a Unique Customer Experience: Unique showrooms which give an
        entirely new buying experience. Like the one at Chow patty, Mumbai. A number
        of existing dealer’s outlets has been converted to incorporate the same concept.
       Customer Touch: Building Database of customers for Target Marketing.
       Improve Operational Efficiencies: Through outsourcing wherever required,
        value engineering and strategic sourcing. Emphasis on Business Process Re-
        engineering.


                                       -4-                               TATA & Mahindra
Marketing Management


       INNOVATION - This is the Mantra of the current growth of M&M story. From
       soft top to rugged Armada/Marshal then Urban Bolero and now Up-market
       Scorpio. This all has happened with in-house R&D.


TATA Motors:
      Brand Name: TATA’s is a big brand name with millions of Indians associated
       with it. It has been in the top notch of the Indian Industry since Independence and
       is making a good use of this advantage.
       Tata Sumo topped the Economics Times Most Trusted Brand Survey for 2004.
      First Mover Advantage: TATA’s “First Mover” strategy has been the backbone
       of their success. This is clearly indicated as it was TATA’s Safari which initiated
       the SUV segment in India. Also the first Indian company to launch Turbo
       Charged Car.
      Dealer Network: TATA’s success in the MUV segment has been buttressed by
       their established network of dealers and showrooms. State of the art showrooms
       and big dealers has helped TATA’s to be a notch ahead of its competitors.
      Leader in Production: State of the art manufacturing facilities and following of
       the best practices of the industry has earned them this position. It is clearly shown
       by the rankings of their vehicles in most of the surveys.



Mahindra’s Belief about Automotive Sector:

M&M’s management is very positive on the growth prospects of the Utility Vehicle
market. This belief is supported by the 2 reasons mentioned below,


      Reconstitution of the UV market towards Hard Tops, which will increasingly
       compete with and substitute demand for passenger cars: The distribution
       mentioned below buttresses their outlook.




                                     -5-                              TATA & Mahindra
Marketing Management


       100

       80

       60
                                                                               Car
       40                                                                      UV

       20

        0
                US             Asia         Indonesia        India



       Note: The graph above shows the composition of Cars and UV used for
             personal purpose.


       The Indian Automobile sector comprises of just 17% of UV segment compared to
       the other countries where the composition of UV is quite high.


      Nature of the Indian Market: Joint Family System, Road Conditions, Rural
       Markets and status seeking Indian male are all pointers towards a good potential
       for the UV market, if the consumer is targeted properly.
       The continued deregulation & liberalization of Indian Economy has provided an
       impetus to rapid growth. India is expected to become a major export base for auto
       components and aggregates. Global automobile giants are entering the Indian
       market. Increasing GDP growth rate, multi-motorization and envisaged higher
       investment in infrastructure is expected to give further boost to the Indian
       automobile industry. The company is gearing itself to meet these challenges
       through rapid up gradation and expansion of manufacturing technologies through
       additional investment. This would be supported by modern, elegant and efficient
       distribution network with consumer friendly work ethics.




                                      -6-                            TATA & Mahindra
Marketing Management


PRODUCTS:

Mahindra & Mahindra:
Bolero:
      “Anything Else is Just a Car”
      Very comfortable, well-finished and refined.
      Great ride comfort and handling
      Termed as the Harley Davidson of four-wheelers
      Spacious and good value for money
      Low Price


Scorpio:
      “Nothing Else Will Do”
      Scorpio is M&M’s answer to Tata’s Safari.
      All Scorpio versions come with factory fitted AC’s and posh and spacious
       interiors.
      It is a rugged vehicle that can handle rough terrain and at the same time offer the
       seating and driving comfort of a car.
      Scorpio scores majorly on PRICE. The vehicle priced in a range of Rs. 6 – 8
       Lakhs, makes it a great proposition to buy, say auto analysts. No wonder why
       Scorpio logged over 1,000 bookings and generated more than 10,000 walk-ins
       and over 3000 customer enquiries within 8 days of its launch.


MaXX:
      “MaXX mane Zyaada”
      Big on size – “More Space”
      DI super engine – high fuel efficiency
      Low maintenance – “More Value”
      Better Fuel Consumption 14 – 15 Km/Litre




                                    -7-                                TATA & Mahindra
Marketing Management


TATA Motors:


Tata Sumo
      “Think Big Think Sumo”
      Topped the Economics Times Most Trusted Brand Survey for 2004
      Spacious
      Big success with Taxi segment
      Refined looks.



Tata Safari

      “Make your own road”
      Better air flow to rear seat passengers.
      State-of-the-art Blaupunkt music system.
      Smooth Engine
      Good Air-conditioner
      Refined looks


Safari Dicor:
      “Reclaim Your Life”
      Better seating arrangement
      More comfortable and spacious
      Better control
      Improved Air-conditioning




                                     -8-                      TATA & Mahindra
Marketing Management


PRICE:
                          Price Slots
  Product




            Scorpio

             Bolero

              MaXX

                      0      2     4               6                 8


                           Price (in Lakhs)



                                                                         Price Slots
                                              Product




                                                        Dicor

                                                        Safari

                                                        Sum o

                                                                 0       2      4     6   8     10    12


                                                                             Price (in Lakhs)




                                        -9-                                         TATA & Mahindra
Marketing Management


MARKET FOCUS (PLACE):

The Market Focus of both, TATA’s and Mahindra, is more or less the same as mentioned
below.


        Strategy for Low End Markets is delivering value for money, increasing safety
         features, incorporating fuel efficient engine, improving the quality of after sales
         service and maintaining low price product image.




        Strategy for High End Markets is to offer products with more comfort level with
         option of accessories to meet special needs of individuals.




        Strategy for International Market is to focus on African, South American, South
         Asian and Middle East markets, where the need and use of vehicles is akin to
         India.




                                      - 10 -                            TATA & Mahindra
Marketing Management


PROMOTION:
SUV and MUV are targeting at the market share of the semi luxury cars. Vehicles like
Sumo+, Safari from TATA Motors and Mahindra’s Scorpio, Bolero are looking at
capturing the semi luxury car market. The consumer segment for the B and C segment
cars were analyzed and following findings were found:
           1. Size matters - big size stands for status
           2. Consumers seek latest technology
           3. Imagery but at affordable prices
           4. The sheer thrill and passion of driving an SUV
           5. Power of the vehicle makes a statement
           6. But along with the others, luxury was a very important parameter
           7. International vehicles define imagery


Keeping these findings in mind both TATA Motors and Mahindra & Mahindra have
changed their promotion strategy in order to capture this market segment.


Sumo when launched in 1997 as passenger vehicle, gained popularity in TAXI market.
This led to Sumo losing its image as a passenger vehicle. In order to reposition (SUMO)
TATA Motors promoted Sumo EX+ and Sumo+ in 2002 as a personal vehicle. Ex+ was
positioned at the top end of the series, emphasizing on its new features like Air
Conditioners and adjustable seats for driver and co-driver in addition to power windows.
About 60% percent of Sumo sold is being used by fleet operators and 40% as personal
vehicle.
All new Scorpio CRDe from the stable of M&M evoked an enthusiastic response in the
market place. The waiting period for this model is one month when automobiles are
available off the shelf in India. The Bolero and its variants also performed well. Scorpio
is doing particularly well in capturing the semi luxury car segment.


The promotion of Scorpio and Bolero is paradigm shift in strategy from “a rough and
tough image” to “self driven and luxury vehicle”.



                                     - 11 -                            TATA & Mahindra
Marketing Management



Ansoff’s Model




                  Current Mkt             New Mkt




  Current       Sumo Spacio         Sumo Deluxe
  Product



  New                  Safari            Safari Dicor
  Product




                                                 Current Mkt    New Mkt


                                                               Marshall
                                Current          Commander     relaunched as
                                Product                        MaXX



                                New                 Bolero        Scorpio
                                Product




                                - 12 -                         TATA & Mahindra
Marketing Management


CASE:
Tata Sumo v/s Bolero

      At the top end, M&M unveiled the Armada Grand and then Bolero which was
       priced on a par with the Sumo Deluxe. And had a few more frills. For example,
       the Bolero has central locking and power windows, features available only in the
       Tata Safari. The market responded enthusiastically to both these variants.


      M&M also launched Marshal and Marshal Royale with metallic paint and Decals,
       to consolidate leadership in low end personal market.


      Sumo base model called Spacio cost Rs 3.7 lakh. To compete against the Sumo's
       base model M&M launched a wider version of the Marshal dubbed the MAXX.
       This vehicle was targeted at the commercial operators who were earlier Sumo
       loyalists. And realizing that this was a price-sensitive market, the Marshal (which
       didn't have too many frills) was priced at Rs 3. 75 lakh, offering better value
       proposition on account of better fuel economy, lower maintenance and more
       space leading to comfort.


Strategy Used:
Sumo had its own set of problems. Tour operators say that the independent front
suspension is a pain. The suspensions pack up frequently and either needs to be serviced
or replaced; replacing the suspension costs Rs 25,000. Another problem is the
replacement of the front tyres. Says a commercial operator: "We don't mind paying
slightly more for a vehicle, but the vehicle should not have any problems in the first two
years. Sumo did not satisfy this condition."


The M&M think tank attacked the Sumo on other fronts as well. When drawing up an
initial strategy to attack the Sumo, M&M's executives noticed that the Sumo's resale
prices were unnaturally low. A two-and-a-half year old Sumo was available for less than
Rs 2 lakh (an Armada of similar vintage hawks for Rs 2.5 lakh).


                                     - 13 -                             TATA & Mahindra
Marketing Management


This meant that the vehicles had problems big enough for commercial operators to shy
away from them. Again, it was four years since the Sumo was first launched and M&M
figured that the operators who had picked up the first batch of Sumo’s would perhaps be
looking for replacements.


So sales teams were asked to meet up with Sumo owners looking for replacements and
sell them the hard economics of running the vehicles rather than focus on the features of
the vehicles. And here M&M scored. M&M's sales force sold the idea -- backed by
numbers -- that all other things being equal, the lesser cost and the lower running
expenses would help commercial operators to recover the costs of an Armada in less than
two years compared to three years for a Sumo.


M&M camp greeted with glee rumors that Telco engineers had stripped down a few
Marshals to find the secret of its success.




                                    - 14 -                           TATA & Mahindra
Marketing Management


CONSUMER BEHAVIOR ANALYSIS:
Mahindra & Mahindra:

Location: Mahindra Showroom, Chowpatty
Owner: Mahindra & Mahindra Ltd. (Company Showroom)
Ambience: Well Lit, Informative charts put up on the walls for the consumer to go
through in the event of salesman not free. Technical Brochures also presented to the
consumer incase no salesman free.
Receptionists technically sound with very good communication skills along with fair
information about the products. (This is a part of the knowledge management and
customer experience initiative undertaken by M&M).


What we observed……….
      When a customer walks into the showroom, he is confronted by the receptionists
       instead of being pestered by the sales person. The job of the receptionist was to
       find out the actual requirements of the customer. This was achieved by a question
       answer session.
      On the completion of the above activity and bridging the gaps, the customer was
       introduced to the appropriate sales person who showed the product to the
       customer.
      One thing I observed was that at M&M showroom the sales person insisted the
       customer to take a test drive and then make its own perception about the product
       rather than telling about the cars performance and other features. They insisted a
       lot on customer experience.
      Also separate discussion cabins were available incase customer wanted to clarify
       any doubts or spend a few moments alone with the family to make a final
       decision.
      The sales person was very well versed with the technical aspects and on most
       occasions was able to satisfy the customer.
      A separate spare parts section was also available projecting the importance and
       stressing on the after sales service.


                                      - 15 -                           TATA & Mahindra
Marketing Management


      A number of consumers had loan queries which were answered by the Finance
       Dept present in the showroom premises.


“…….we are here not to sell cars but to serve the customers by providing them an
unforgettable experience……..”
                                                                Showroom Manager
Tata Motors:
Location: Tata Motors Showroom, Bhakti Bhavan, Chembur
Owner: Wasan Motors
Ambience: Very comfortable, separate floors for Sumo and Safari. Informative
brochures present in the customer lounge along with the framed advertisements of Sumo
and Safari.


What we observed……….
      When a customer walks into the showroom, he is given the brochures of the car as
       per his requirement and allowed to spend sometime alone to go through them.
      On the completion of the above activity, the customer is introduced to the
       appropriate sales person who showed the product to the customer.
      Sales person communication skills not up to the mark but very good in technical
       knowledge.
      No separate discussion cabins were available
      A separate spare parts section was also available projecting the importance and
       stressing on the after sales service.
      At Tata’s more stress was put on telling the customer about what TATA has to
       offer rather than trying to find out his requirements and meet them.
      A number of consumers had loan queries which were answered by the Finance
       Dept present in the showroom premises.


“…….we at Tata’s lay a lot of stress on customer relationship which starts after the
sale of the car……..”
                                                                Showroom Manager


                                      - 16 -                          TATA & Mahindra
Marketing Management




                             REFERENCES



      Marketing Management – Kotler (11th Edition)
      AutoIndia, Overdrive, Times Drive
      Economic Times, Times of India
      www.mahindraworld.com
      www.tatamotors.com
      www.automartindia.com
      Brochures
      Information from company officials




                                 - 17 -               TATA & Mahindra

				
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