IT IS IMPERATIVE TO CLEARLY ARTICULATE THE VALUE THAT THE NANO BRINGS AT A CERTAIN PRICE POINT AS OPPOSED TO BEING ‘CHEAP’
In an exclusive interview with WCRC Leaders Asia, Ankush Arora, Senior Vice President, Passenger Vehicles Business Unit (Commercial), Tata Motors Limited, shares his company’s vision for the new Nano
Your former managing director said that the Nano Twist and emax marked the unveiling of a Nano portfolio that stands true to its brand essence: a youthful exciting car. This is a radical shift from a poor man’s car. Is this a tacit way of accepting that the Nano was wrongly branded?
The new Nano is aimed at a younger, aspiring consumer class and has further evolved to become the next generation car – a car that is cool, peppy and fun to hang out with. Most of the features that we have added or built in the new Nano have come as recommendations from the customers. The new variants come with an array of new features.
So the new communication is a result of the New Nano, which is full of ‘Awesome’ features. We expect it to attract all three segments of buyers – first time buyers, replacement buyers and additional buyers – and fulfil the rational and emotional needs of a consumer. We have kicked off our journey with a clear understanding of customer insights.
Tata Nano, to us, is clearly innovative and that is how it was conceived by Ratan Tata. So we have not moved away from that thought. But it is imperative that we clearly articulate the value that a brand like Nano brings at a certain price point, as opposed to being ‘cheap’ because there has been a misconception about the price tag. We believe that this is a great value point to deliver to a clear set of aspirations – whether it is the awesome car with a funky vibe for the youth, which always looks at a different kind of price-point; to delivering safe mobility solution to a young or multi-member family; to delivering a smart, interestingly designed feature-led vehicle for quick movement around the city traffic. Our brand communication is now explicit and clear.
Many people feel that the real problem was not with the positioning but the product itself. Do you agree with that view? If there were problems, what is Tata Motors doing to fix those? The launch of the new Nano is part of Tata Motors’ HORIZONEXT strategy to deliver cars with matchless best-in-class features, superior technology and design engineering, keeping our customer at the core of the processes. So, we are in a continuous process of delivering what our customers demand.
As I said, the new Nano is evolved to become the next generation car. The new variants come with an array of new features which include remote keyless entry, twin glove boxes, and a four-speaker AmphiStream music system with Bluetooth, USB and auxiliary connectivity. We have also recently introduced the Nano Twist which comes with a power steering.
The Nano has 21 per cent more cabin space in spite of being six per cent smaller than other cars in its category. With its unique “Mono Volume Design,” it also offers best-in-class headroom for all passengers and at 25.4 km per litre, it is India’s most fuel-efficient petrol car.
There are several plans that will unfold as we move forward. We will be initiating many more innovative campaigns. All these efforts will gradually show results.
Let me inform you that Tata Nano, has ranked number 1 in the category of Car – Hatchback (TRA) and has been crowned the most ‘Attractive Brand’ amongst all cars in the ‘India’s Most Attractive Brands – 2013’ report.
Did Tata Motors initially underestimate the aspirations of a family graduating to a four-wheeler from a two-wheeler? Was a compromise on quality made to cut costs?
Right from its inception, Tata Nano has invoked a great deal of excitement amongst consumers. It helped put India on the world motoring map with its innovative frugal engineering and best-in-class features and price point. Quality was never compromised upon.
In fact, it is an awesome case of innovative engineering. The Nano was a breakthrough in the automobile segment which carried forward Ratan Tata’s dream of providing mobility options to people. Tata Nano is India’s most innovative car in design, engineering and technology and, yet, has always believed in reinventing the norm, thereby raising the bar for itself.
In 2012, a fifth of Nano buyers fell in the 18-34 age bracket. In 2013, that share more than doubled at 55 per cent. But it has not translated into increased sales figures. So did the ‘Awesomeness’ campaign, while successfully appealing to the youth, failed to drive the numbers up? It seems the Nano can’t do both at the same time. What steps are you implementing to see that this situation is addressed?
I will not be able to provide any sales projections. However, the markets are challenging. The passenger market is seeing rough times and the same has affected the Nano as well.
We will wait and watch. The healthy sign is that since the beginning of this fiscal, we have been on the growth curve as far as the retail sales goes.
The kind of customers we are attracting today are real good buyers. So, that is a very healthy sign – a good mix of youngsters, middle-aged people who really want the product. If we tread down that path, we expect the numbers to change in the next six to nine months. If the quality of sales is good, the possibility of positive word of mouth is going to be better. That is what is going to help the Nano sales go up.
We have kind of held ourselves to the ground, and taken the beating of the numbers, to do the right thing of building the aspiration of the brand. We will build-up the volumes, slowly but steadily. We will get our distribution channel in sync. The display of the Nano in the showrooms will be with full accessories. We need to do up the product on display. There is a level of attractiveness that we would like to maintain and showcase the inherent design strength that product has. We are on course to do that.
A continuing grouse of Tata Motors passenger car buyers has been shoddy after-sales service. How are you planning to fix this?
I am happy to share with you that according to JD Power’s 2013 study, Tata Motors has diligently maintained an above-mass average position of 94 per cent and above, across all parameters in the sales standard when it comes to sales service at dealerships.
Under the umbrella of our extensive and expansive service programme, we had, in the recent past, announced the launch of HORIZONEXT, an aggressive four-pronged customer-focused strategy.
One of the pillars of this strategy is ‘consistent quality of service’. We are continuously working towards our after sales service. These services can be availed by buyers of our newly launched vehicles too. For instance, the Nano Twist which we launched recently will come with a four-year or 60,000-km warranty.
Apart from the interiors, features and ergonomics, will the new models feature thicker body sheets, more powerful engines, more boot space, etc? Most of the features that we have added or built in the new Nano have come as recommendations from the customers and I have already spelt them out. The Nano EMAX is the CNG version and sports all these features.
We are constantly working on new variants and range extensions, across our passenger vehicle portfolio. We have several plans for the Nano as well. We have a strong go-to market strategy for the Nano. The range will keep evolving, keeping customers central to product development as we move forward. We will announce our launch plans at an opportune time.
Tata Motors has a unique and exhaustive bouquet of products that stretch from the Nano all the way to JLR. How do you prioritise your focus and campaign strategy, especially since JLR sales have been doing very well across the world and specially in India?Your current marketing drive seems to target the urban Indian youth population. How are you planning to cream the huge rural market in India? Is there a separate strategy which you are working on?
Urbanisation in India is expanding at a very rapid pace; towns are becoming cities and cities are becoming mega cities. We may not be able to compare the infrastructure to some of the developed markets. But still, there have been phenomenal changes.
Therefore, cities are no more limited to the metros and the lifestyle which used to characterise the metros has entered Tier II cities.
Aspirations have also equally changed, whether they be in terms of adopting brands or in terms of exposure of brands. The whole thing about being smart, leading a city life is no more limited to metros. It has gone beyond that.
And that’s where the concept is coming from. The Nano is repositioned as the smart city car because of the way it is used. The Nano has been adding tremendous value to its customers, cutting across age groups, classes and geographical diversity.
With Horizonext, we have arrived at our four-pillar strategy which includes- Product focus, World-class quality, Enhanced purchase experience and Quality service. We have charted our product pipeline up to 2020 and we will make these announcements as we move ahead.
In the last four to five months alone, Tata Motors has aggressively expanded internationally as well. We launched new products in South Africa, Indonesia and Thailand and have entered the Australian market.
Has the ghost with the electricals been finally put to rest?
It’s not for nothing that Tata Nano was ranked number 1 in the category of Car – Hatchback (TRA) by India’s Most Attractive Brands – 2013. This is a strong proof of how happy the customers are with the car.
The Nano owner sees tremendous value in the product. In various customer meets, owners have told us that they enjoy spinning it out of traffic, that the car can be parked very easily, that it has good visibility, etc. I hope this puts all those doubts to rest.
Who, in your opinion, should buy the new, upgraded Nano?
The new Nano is aimed at a younger, aspiring consumer class all the while maintaining a balance between its offering and price point. Tata Nano’s new spunky avatar allows it to accommodate the needs of its customers and simultaneously carve a place for itself in an intensely competitive and discerning automobile market.
The new-edition Nano has, therefore, further evolved to become the next generation car – a car that is cool, peppy and fun to hang out with.
The new Nano relates to young achievers who live life according to their own rules and have charted a new course for themselves.
Nano, surprisingly, has not been exported although the Europa was unveiled at the Geneva Motor Show in 2009. Did Tata Motors desist from this because it was an under-engineered product? Now that you are fixing these issues, how and by when do you think one can see the Nano on foreign shores? Do you have any figures in mind along with a time-frame?
Internationally, the Nano is available in Nepal and Sri Lanka. We plan to launch it in Thailand sometime in 2015. Other markets are being evaluated.
Our marketing strategy is backed by extensive research and consumer insights. Speaking to our customers, we understood that the brand has been bonding with its users in a very emotional way.
Customers have always used the Nano as a smart city car. We actually have a whole new set of customers, who are actually using the car and giving us the feedback. We keep continuous dialogue with our customers which helps us bringing in the new developments. There are structured research and individual research being conducted for further improvements.
We have a group of young ambassadors to find out exactly how customers view the Nano and the role it plays in their lives. Every new feature on the Nano is carefully chosen based on the needs of the new-age customer.