It was a thing of the past that same outlets and dealerships used to sell both Passenger cars and Commercial vehicles. Not that nobody knew how to market but the industry dynamics was such that automobiles used to be "Pull" products. Nowadays, its a mix of both "push" and "pull". Hence the companies are giving more and more importance to the 4P's of marketing - product, promotion, price & place.
Lets see how Tata Motors is doing it.
Products are aplenty in the company's stable. From 1.6 lakh's Nano to a 1.1 crore Jaguar, this company boasts of the most versatile product range in the world. These products cater to various target segments and are thus projected differently. The promotions are unique for each brand and tend to focus on their targetted segment group. e.g. Safari's "Reclaim your Life" is focused more towards the adventurous-yet-successful group of people. Nano's "Khushiyon ki Chabi" focuses on value for money and family emotions. So, these ads are meant to make a space in the particular brand's target segment. Price of the product too helps ascertain the message conveyed through various ads. The company uses various pricing strategies too and that also differs across the brands. e.g. Nano's initial pricing of 1 lakh was a penetration pricing where it was more important to increase market penetration. Presently, the pricing can at best be termed as cost plus pricing, where a certain margin is added to the cost of manufacturing. Aria's pricing on the other hand can be easily branded as a creamy strategy. It is deliberately kept on the higher side so that public views it as a premium product. So pricing is a big factor in automobile industry where there's a host of models in the price bracket of 3-8 lakhs. Now lets discuss the most important P - Place. Place indicates the location where the suppliers come i.e. manufacturing plant and where the customers come i.e. dealerships.
Tata Motors has multiple manufacturing locations spread across the country. This helps in spreading the tax gains that state govt's offer to the company in exchange of investment. It also ensures that the company ties up with multiple suppliers and thus reduce its dependence on few selected suppliers. In case of dealerships, network reach is the road to success. Maruti, Hyundai has shown it. Tata Motors is following it strongly now but with a difference. Instead of opening full range dealerships, Tata Motors is opening up segment specific or Line of Business specific outlets. e.g. Nano outlets, Utility Vehicles outlets, etc. This makes sense as then the market penetration increases at a very rapid pace and dependence on large entities reduce. Within a few month's time, the company has managed to open up more than 100 such outlets across the country. Biggest positive points for these outlets are a) Low turnaround time (b) Low break even point (c)Faster service to the customer. The only negative aspect might be of customer experience and am sure the company will make policies to manage that. What a great idea indeed.
It wont be long that this unique network expansion drive will start reaping rich results for the company. Then others will surely follow suit too. And the industry will be back to BOOM once again!
