The revamp of TATA Nano

By – Chinmay Thombre

The sales for the TATA NANO, arguably the world’s most economical car, fell to as low as 509 units in the month of November 2010. The TATA NANO, renowned world over as a magnificent example of reverse engineering, managed to sell as many as 8262 units in the month of Feb 2011. This was an increase of 1600% in terms of the number of units sold as compared to those in November 2010!
How did this change occur? What possibly must have been the reason for this transition? The entire buzz created before its launch, was realized with the 5500 bookings on the very first day. But the sales dipped steeply as a result of the ‘higher than promised’ price and the reports related to the NANO’s safety concerns, owing to incidents in which the car caught fire spontaneously. TATA Motors had even hoped that the small wonder will have an annual demand of not less than 1 million. But the hopes faded away due to reasons such as lesser sales outlets causing late deliveries and the growing concerns amongst people about the quality at such low price.
Accordingly, the process of revamping was initiated. With the help of the consultancy firm Accenture, TATA Motors reviewed the issues related to production, quality standards and supply chain management. Accenture also helped TATA Motors with its new growth markets and push its sales. With its changed marketing strategy, Nano seems to have struck the right chord. Strategies like aggressive advertising campaign, maintenance charges at Rs.99 per month etc have helped boost sales. TATA motors offered full replacement of all its spare parts for an installment of Rs.4000 for a year. The number of sales outlets for Nano has also been increased. TATA Motors have also tied-up with the largest retail chain of India- Big Bazaar. This experiment has also proved to be very useful as 500 units of Nano were sold in one month.
The importance of improved marketing strategy, Brand positioning and advertising and improved supply chain management proved significant. TATA Motors aims to sell around 15000 units in the coming months. This means an ambitious target of 1.8 lakh units in a year. Hopefully, the future sales for Nano will not be as “Nano” as they were recently and the Indian market does not say “TATA” to the marvel called TATA Nano.