Tata ace

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Tata ace

  1. 1. Jegadeesan Priyatharisini R Sriram BSK Uthra G Vivekh BIG THINGS COME IN SMALL PACKAGES
  2. 2. <ul><li>Launched in May 2005 </li></ul><ul><li>Inspired from Highly successful Japanese Minitruck Kei Truck (introduced 1977) and Korean Kia Bonga (1980) </li></ul><ul><li>Tata Ace is priced in the range </li></ul><ul><ul><li>Rs 2.25 lakh for BS II (ex-showroom NCR) </li></ul></ul><ul><ul><li>Rs 2.35 lakh for BS III (ex-showroom NCR) </li></ul></ul><ul><li>Tata Ace is powered by a small and efficient 16bhp 700cc IDI diesel engine </li></ul><ul><li>Suitable for both rural and urban use </li></ul><ul><li>Tata Ace sets the trend as the country’s first </li></ul><ul><ul><li>high performance, low maintenance </li></ul></ul><ul><ul><li>safe and reliable mini-truck </li></ul></ul><ul><ul><li>sporty car-like features to ensure comfort in ride and handling </li></ul></ul>10/06/11 Tata ACE - Team 10-Thiagarajar School of Management
  3. 3. 10/06/11 Tata ACE - Team 10-Thiagarajar School of Management Ref: http://www.wheelosphere.org/little-elephant-tata-ace-sales-cross-100000-in-fy-2010/ FY Sales Figures 2005-2006 30,000 2006-2007 70,000 2007-2008 89,000 2008-2009 81,000 2009-2010 110,032 (With Tata Magic 160,000) 2010-Nov’11 160,000 (upto 30-Nov-2010) Aiming for 250,000 this year
  4. 4. <ul><li>The 3 wheelers had the following issues </li></ul><ul><ul><li>wore a rustic look </li></ul></ul><ul><ul><li>uncomfortable </li></ul></ul><ul><ul><li>not very safe for carrying load at high speed </li></ul></ul><ul><li>Though the price was less, the operating cost was very high </li></ul><ul><li>Need for company: blue ocean strategy </li></ul>10/06/11 Tata ACE - Team 10-Thiagarajar School of Management
  5. 5. <ul><li>Quadrilateral project -led to creation of large number of expressways and widened many of the existing highways </li></ul><ul><li>A portion of traffic moved from railways to roads and pushed the demand for heavy and light commercial vehicles </li></ul><ul><li>Urbanization- cities pushed their geographical boundaries </li></ul>10/06/11 Tata ACE - Team 10-Thiagarajar School of Management
  6. 6. <ul><li>Increasing population and growth in the organized retail sector with the entry of large players </li></ul><ul><li>Social status for Users </li></ul><ul><li>Last mile distribution vehicle </li></ul><ul><li>TATA motors identified these macroeconomic trends </li></ul><ul><li>Realized that there will be an increased demand for LCVs in urban areas </li></ul>10/06/11 Tata ACE - Team 10-Thiagarajar School of Management
  7. 7. <ul><li>TATA motors wanted to reduce their dependence on the MCV and HCV segments </li></ul><ul><li>They started losing their market share in these segments in the late 90s </li></ul><ul><li>TATA motors wanted to diversify </li></ul><ul><li>The launch of their LCV, TATA ACE helped in achieving these goals </li></ul><ul><li>During the financial meltdown (2008-09), even as the MCV &HCV segments in India shrank by 33% compared to the previous year, Ace in the LCV segment fell by just 12%. </li></ul>10/06/11 Tata ACE - Team 10-Thiagarajar School of Management
  8. 8. 10/06/11 Tata ACE - Team 10-Thiagarajar School of Management Subaru Sambar Honda Acty Mitsubishi Minicab Suzuki Carry
  9. 9. <ul><li>Basic needs of small scale transporters </li></ul><ul><li>Customers in rural areas attached prestige to their transport vehicles </li></ul><ul><li>Safety </li></ul><ul><li>Comfort to the driver </li></ul><ul><li>Speed </li></ul><ul><li>Ability to drive in the narrow lanes </li></ul><ul><li>Tight Turning Radius </li></ul><ul><li>Low operating costs </li></ul>10/06/11 Tata ACE - Team 10-Thiagarajar School of Management
  10. 10. 10/06/11 Tata ACE - Team 10-Thiagarajar School of Management Trend in Market Share Source: Tata Motors Financials Reports
  11. 11. 10/06/11 Tata ACE - Team 10-Thiagarajar School of Management Sales Growth Achieved Source: Tata Motors Financials Reports
  12. 12. <ul><li>Target segment – Individual Customers </li></ul><ul><li>Target customers: who expect a high Return On Investment (ROI) along with safety, comfort, and status </li></ul><ul><li>136,000 Three wheeler SCVs were sold in 2005 </li></ul><ul><li>With 20% attrition towards ACE and attracting another 25,000 customers, market is very attractive to enter </li></ul>10/06/11 Tata ACE - Team 10-Thiagarajar School of Management
  13. 13. <ul><li>Value proposition </li></ul><ul><li>High Performance with car-like features in safety, comfort </li></ul>10/06/11 Tata ACE - Team 10-Thiagarajar School of Management
  14. 14. <ul><li>Price was higher as compared to competitors but the company supported it on the basis of the value provided </li></ul><ul><li>Initially a discount of 4000 Rs was given </li></ul><ul><li>80% of the vehicle has been outsourced to keep costs low without </li></ul>10/06/11 Tata ACE - Team 10-Thiagarajar School of Management
  15. 15. <ul><li>Initial Launch </li></ul><ul><ul><li>Company launched ACE in the south first through its Dealers and Dealer Branches </li></ul></ul><ul><li>Distribution network: Hub & Spoke model </li></ul><ul><ul><li>Existing dealership acted as hubs & set up IS dealerships </li></ul></ul><ul><ul><li>Location close to target markets </li></ul></ul><ul><ul><li>Plant located in Pune at the time of launch </li></ul></ul><ul><ul><li>Target markets (southern and western regions) </li></ul></ul><ul><li>Current Availability </li></ul><ul><ul><li>26 Commercial vehicle dealers in Tamilnadu </li></ul></ul><ul><ul><li>Available in all 28 states </li></ul></ul><ul><ul><li>1700 Tata Ace specific dealers all over India </li></ul></ul>10/06/11 Tata ACE - Team 10-Thiagarajar School of Management
  16. 16. <ul><li>Value proposition </li></ul><ul><ul><li>High performance with car like features </li></ul></ul><ul><ul><li>Advertisement with Tag Line “Kutti Yanai” </li></ul></ul><ul><ul><li>A symbol power </li></ul></ul><ul><ul><li>A symbol of reliability </li></ul></ul>10/06/11 Tata ACE - Team 10-Thiagarajar School of Management
  17. 17. <ul><li>Benefit sought Behavioral Segmentation </li></ul><ul><ul><li>Need based </li></ul></ul><ul><ul><li>Focus on comfort and safety </li></ul></ul><ul><li>Demographic Customer profile Segmentation </li></ul><ul><ul><li>Individual Vehicle owners </li></ul></ul><ul><ul><li>Fleet Owners </li></ul></ul><ul><ul><li>Institutional Customers </li></ul></ul>10/06/11 Tata ACE - Team 10-Thiagarajar School of Management
  18. 18. 10/06/11 Tata ACE - Team 10-Thiagarajar School of Management <ul><li>Strength </li></ul><ul><li>Strong brand name </li></ul><ul><li>Leverage of First mover advantage </li></ul><ul><li>Good logistic management </li></ul><ul><li>Continuous innovation </li></ul><ul><li>Opportunities </li></ul><ul><li>Rural market </li></ul><ul><li>High growth rate of LCV segment </li></ul><ul><li>Weakness </li></ul><ul><li>High product cost </li></ul><ul><li>After sales service </li></ul><ul><li>Complaints on gear shifting </li></ul><ul><li>Threats </li></ul><ul><li>Increased competition due to new entrants </li></ul>
  19. 19. <ul><li>Piaggio - Ape, Quargo </li></ul><ul><li>Bajaj - Tempo, Max series, RE600 </li></ul><ul><li>Mahindra & Mahindra - MN 25 & MN 31 trucks, MN40, 49 trucks (Navistar Inc USA), Maxximo & GIO </li></ul><ul><li>Force motors - Trump Trax, Kargo king </li></ul><ul><li>Hyundai motor – Porter </li></ul>10/06/11 Tata ACE - Team 10-Thiagarajar School of Management
  20. 20. <ul><li>Model T product development was based on “Traditional Physical Process Sequence” </li></ul><ul><ul><li>Design product, procure and make </li></ul></ul><ul><ul><li>Price, sell, promote, distribute and service </li></ul></ul><ul><li>While Tata ACE product development was based on the latest marketing strategy, “Value Creation and Delivery Sequence” </li></ul><ul><ul><li>Customer Segmentation, product focus, value positioning </li></ul></ul><ul><ul><li>Product development, service development, pricing, sourcing/making, distribution, servicing </li></ul></ul><ul><ul><li>Sales force, sales promotion, advertising </li></ul></ul>10/06/11 Tata ACE - Team 10-Thiagarajar School of Management
  21. 21. <ul><li>Market sensing process </li></ul><ul><ul><li>Identified the needs of potential customers like Traders, Truck drivers and Farmers </li></ul></ul><ul><li>Blue ocean strategy and Rural marketing activities </li></ul><ul><ul><li>Tie-up with Godrej Aadhar and other rural dealers </li></ul></ul>10/06/11 Tata ACE - Team 10-Thiagarajar School of Management
  22. 22. <ul><li>Functional gratifications </li></ul><ul><ul><li>Speed </li></ul></ul><ul><ul><li>Capacity </li></ul></ul><ul><ul><li>Service points </li></ul></ul><ul><ul><li>Easy navigation in roads </li></ul></ul><ul><ul><li>Low maintenance and operating costs </li></ul></ul><ul><li>Sensory gratifications </li></ul><ul><ul><li>Sleek appearance </li></ul></ul><ul><ul><li>Position as “ truck in mini size” </li></ul></ul><ul><ul><li>Comfort </li></ul></ul>10/06/11 Tata ACE - Team 10-Thiagarajar School of Management
  23. 23. <ul><li>Extended as passenger vehicle as Tata Magic </li></ul><ul><li>Designed to larger tyres to acquire greater speed </li></ul><ul><li>Improved fuel efficiency by 6-10% </li></ul><ul><li>Mileage 25kmpl </li></ul><ul><li>Smaller model of Tata Penquin for Rural market </li></ul><ul><li>Reference: </li></ul><ul><ul><li>www.tatamotors.com </li></ul></ul><ul><ul><li>www.moneycontrol.com </li></ul></ul><ul><ul><li>www.rediff.com </li></ul></ul>10/06/11 Tata ACE - Team 10-Thiagarajar School of Management
  24. 24. 10/06/11 Tata ACE - Team 10-Thiagarajar School of Management

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