Tata Nano Case Study

Introduction of Tata Nano

Tata Motor’s, India has introduced Tata Nano as an innovation leading to the new market creation to strike the concealed prospects in the automobile four-wheeler segment. Tata Nano was exposed in the segment as a cost leader within the common market place, with a purpose to attract as much as customers that the company could get. For this reason, Tata Motor’s targeted this vehicle to the families in lower and middle-income platforms. The management also put the effort to focus on the price aspect and build up the “Price Positioning Strategy” to support the distribution of Tata Nano. In the context of promoting the brand, the company has depended totally on the non-conservative approach, which was by using the help of social media.

Unfortunately, this pricing strategy has gained different feedback came from the consumers who eventually misinterpreted Tata Nano as “Cheap Car” and “Poor Man’s Car.” Due to this, the management of Tata Motor’s has changed its strategy with repositioning Tata Nano to become a “smart city car” and focusing more on the youth to refresh its brand image.

Another problem also has arrived for the distribution of Tata Nano in Sri Lanka, whereas the vehicles have been used by some companies in the taxi business as a standard vehicle to provide the transportation for their passengers. This has made most of the consumers perceive the brand of Tata Nano as a taxi car, or even as “Nano Taxi.” Thus, it has created a big barrier to reach the exact target market of the company.

Three different aspects of the perception for changing the customer perception

            No matter which type of business that a company is working on, customer perception must always be the top priority (Kureemun & Fantina, 2011). This also applies to Tata Motor’s. The company should realize that customer perception will always be affected by how the business operations conducted by the company. It has been approved that pricing, quality, and customer service are the main three aspects that would influence the customers’ loyalty. However, it appears that even though Tata Nano has performed well in these three aspects, but the customers seem to have a different view, and this is where the customer perception arrives.

            In order to operate a successful business, Tata Motor’s need to do furthermore than only providing a great product at an affordable price. Instead, the company needs to create some evidence to show the customers. Thus, there are three different aspects of the perception that needed to be understood by Tata Motor’s for changing customer perception.

1. Product Pricing

One thing that, unfortunately, has been misinterpreted by the management of Tata Motor’s is its pricing strategy. Even though the company was trying to present the cost-effective as its pricing strategy to attract the customers to buy Tata Nano, but Tata Motor’s should realize that there are various different effects of pricing on the company’s reputation. In many cases, an expensive price represents the concepts of quality, luxury, as well as excellent customer experience.  However, an expensive price might also represent as unrealistic, superior, or unreachable. Now if we take a look at the opposite side, a low price might able to attract the customers who are seeking a bargain. On the other hand, a low price might also trigger the concern from the customers around the quality issues of the product. For this reason, to change the consumer perception in this context, the management of Tata Motor’s needs to realize that however the pricing strategy decided by the company, there will be a big influence of how the customers will view the brand itself (Habel, Schons, Alavi, & Wieseke, 2016).

2. The Brand Reputation

The Tata Nano appears to have an issue with its brand reputation whereas people have viewed the brand as “Cheap Car” and “Poor Man’s Car.” In addition to this, how the vehicles have been used by many taxi companies in Sri Lanka has worsened the brand reputation and made most of the consumers perceive the brand of Tata Nano as a taxi car. These circumstances cannot be considered as good progress for the brand reputation of Tata Nano. In fact, these conditions might affect the company to lose the trust and loyalty from its already customers. In addition to this, with this type of reputation, then it would be difficult for Tata Nano to attract new customers (Loureiro, Sarmento, & Bellego, 2017).

In order to change the consumer perception in this context, Tata Motor’s needs to take responsibility and figure out what went wrong with its business strategy towards fixing its damaged reputation. Since the management of Tata Motor’s has been using the support of social media to promote Tata Nano, then the company could make a strong communications strategy to display the customers, what exactly the main purpose of Tata Nano distribution, and bring the positive perception from the targeted market.

3. The Product Quality

As mentioned above, the pricing strategy is often perceived by the customers as related to product quality (Saleem, Ghafar, Ibrahim, Yousuf, & Ahmed, 2015). Due to the cost-effective strategy created by the management of Tata Motor’s, the consumers seem to have a negative perception regarding the product quality and even classified Tata Nano as “Cheap Car” and “Poor Man’s Car.” An important thing that the management should able to understand is that, this product quality has a huge effect on brand perception. For this reason, in order to change the consumer perception, Tata Motor’s has to make sure that the quality of Tata Nano is aligned with the pricing, branding, and all the promises that the company has made regarding the product. Ultimately, the management of Tata Motor’s might need to improve the quality provided by Tata Nano, along with also modify the pricing strategy as well, so that the customers will no longer have a different perception of its product. 

Suggest strategies to change the attitude of local consumers towards Tata Nano

            Some recommendations or suggestions for changing the attitudes of the consumers towards the existing company. Those strategies are very helpful for the company business to grow and expand the business in a very short time. The influence of personal experience, social media, and the environment form the attitudes of the people. However, the significant strategies for the marketers are to bring changes and improvements in the attitudes of the consumers and customers as well as those who like the services of the company as Tata Company that is manufacturing Nano cars for the Indian people needs to adopt some strategies for changing the attitudes of the consumers.  

            The objective of this report is to suggest some marketing strategies for the company to change the attitudes of the consumers. The main aim of the marketers is to make a positive attitude or positive perception of the company and it products in the minds of the consumers and customers. These strategies can make a positive perception of the Tata Company’s Nano cars in the minds of the consumers to perform comparison with other companies to see what things the company is providing and what the things that are offered by the company to the consumers the other companies are not offering. But it is a very difficult task to change the attitude of the consumers whenever they doubtful on the policies of the company that the marketers have an agenda for self-serving to bring the particular change. So, in this report some significant and notable strategies are given that will be very helpful in changing the attitudes of the consumers towards the company in a positive sense (L. Frewer, 2003).

Bring Change in the basic motivation function of Tata Nano

            The makers can bring change in the attitude of the consumer towards the company as well as mainly towards the Nano cars of Tata Company by making prominent the specific needs. An approach the marketers of Tata Company can use to bring the change in the consumer attitudes towards the company that is named as the functional approach. It is an important approach that is classified into four categories such as the ego-defensive function, knowledge function, value expressive function as well as the utilitarian function.

            We can understand it with the help of an example on the value expressive function. The function tells about the attitudes of the consumers. When the consumer or buyer of the company product reflects service or the product according to the self-concept or the central values, the attitudes of the consumers can be expressed. The consumers are given for gaining positive feelings about themselves by expressing the self-image that who are they and what the purpose of them. For example, if the potential buyer of any company loves to wear the activewear such as the tracksuit or sportswear, it will show the identity of the consumer that he or she loves and feels good by wearing the active and sports suits. By targeting the attitudes of the consumer, the marketers may approach theme on their lifestyle, outlook as well as self-image by reflecting the particular characteristics whenever they are doing marketing as well as advertising (Deci, 2008).

Associating the product along with the appreciated event or Group

            The attitudes of the consumers and the prospective buyers of the company towards the Nano Cars of Tata Company may possibly be changed by combining the particular events or the groups. For instance, the biggest fast-food collaboration was made with Cartoon Despicable me 3 by McDonald’s company. The company did advertise as well as new printed menus with the minions influenced the items in the sense of helping to promote the Cartoon movie. The research uncovers the information that an excellent idea for exposing to the consumers the purpose of the sponsorship to the movie in the sense of avoidance the motives.

Resolving Two Conflict Attitudes of Tata Nano

Occasionally, the attitude of the consumers to change strategies may determine the real as well as promising contradiction amongst two attitudes. If the consumers of the product were made to have a negative influence on the product as a Nano car, while if they do not have any clash, this made the consumers change their decisions of the product. We can understand it with the help of an example. Suppose, disposing nappies may be formed for the environment, but it is produced with the organic cotton as well as it can help with the sustainable with the environment (Nodia, 2004).

The change in the component of the model of multi-attribute

            The multi-attribute is the approach for changing the consumer’s attitude by making some changes in the evaluation of the products, the perception alteration about the company as well as the transformation of the whole rating of the company by adding an attribute for the company product. The negative aspect was changed that the product or the company has been done toward by the company of reinforcement of their continuing beliefs. Adding an attribute does, which has been unnoticed by reflecting the real innovation of the product. However, the rating of the company was changed by it.

Propose the methods of applying conditioning theory for developing promotional strategies of Tata Nano

            The main purpose of developing the methods of promotional strategies of Tata Nano is that the company wants to increase the sale as well as to grab the high market share. The market of India currently has many competitors that are strongest ever competitors. The consumers like to have mini cooper because of its brand, but it is so expensive. The theory says that the markers should make the value of the company product to grab the market share. The company is selling cost-effective and fuel-efficient cars. The main purpose is to change the perception of positive manners towards the company by advertising. The company can advertise through TV commercial ads, social media ads as well as other promotional activities. Advertising is the best way to change the perception of the company.

Conclusion of Tata Nano

     I have concluded that India has introduced Tata Nano as an innovation leading to the new market creation to strike the concealed prospects in the automobile four-wheeler segment. The company has brought new innovations by introducing the Nano cars. These cars fuel-efficient as well as cost-efficient. There are some competitors in the market who can give a tough time for the company and maybe a big threat to the business — Tata Motor’s need to do furthermore than only providing a great product at an affordable price. Instead, the company needs to create some evidence to show the customers. Thus, there are three different aspects of the perception that needed to be understood by Tata Motors for changing customer perception. Some strategies are introduced in the company to change the attitudes of the company as well as these strategies can make a high value in the market. To change the perception of the consumer can be in the three ways such as the pricing of the product, positioning of the company or brand as well as by enhancing the quality of the company. The management of Tata Motor’s might need to improve the quality provided by Tata Nano, along with also modify the pricing strategy as well, so that the customers will no longer have a different perception of its product. 

 Recommendation of Tata Nano

             Some recommendation is given in this report that how the company can make increase the productivity as well as increase the sale of the company. First of all, the marketer should bring some changes to the company structure. The main problem the company is facing right now that the company has to face some challenges to increase the sales of the company, but other companies or competitors are also providing Nano cars. The company should give awareness to targeted customers. The marketer should star promotional activities to increase the selling of the company. The company should use social media for advertisement because nowadays everyone is using social media as well as the potential customers can be generated from social media.

References of Tata Nano

Deci, R. M. (2008). A self-determination theory approach to psychotherapy: The motivational basis for effective change. Canadian Psychology/Psychologie canadienne,, 186.

Habel, J., Schons, L. M., Alavi, S., & Wieseke, J. (2016). Warm glow or extra charge? The ambivalent effect of corporate social responsibility activities on customers’ perceived price fairness. Journal of Marketing, 84-105.

Kureemun, B., & Fantina, R. (2011). Your Customers' Perception of Quality: What It Means to Your Bottom Line and How to Control It. CRC Press.

L. Frewer, J. S. (2003). Consumer acceptance of functional foods: issues for the future. British food journal,, 714-731.

Loureiro, S. M., Sarmento, E. M., & Bellego, G. L. (2017). The effect of corporate brand reputation on brand attachment and brand loyalty: Automobile sector. Cogent Business & Management .

Nodia, G. (2004). Europeanization and (not) resolving secessionist conflicts. Journal on Ethnopolitics and Minority Issues in Europe, 1-15.

Saleem, A., Ghafar, A., Ibrahim, M., Yousuf, M., & Ahmed, N. (2015). Product perceived quality and purchase intention with consumer satisfaction. Global journal of management and business research.