Consumer’s Post Purchase Behaviour Corporation

M.Yusuf K Wardhany 041314353003 Rachma Dessidianti 041314353036 Ifril Rachman 041314353046 Rosalina Linda Susanti 041314353009 Ivan Giovanni 041314353020

TATA NANO

ABSTRACT Tata Nano, World cheapest Car vroomed on March 23rd 2009 Few question arose

conceptualisation of the TataNano car and the roadblocks during its production

discuss the dissonance levels in new products

•  understand the conceptualisation and analyse the causes and concerns in taking the car from drawing board to board room to the shop floor

•  debate on whether the introduction of Tata Nano would herald the new age of

small cars and whether India can become the hub for small cars •  understand the bottlenecks involved in the production of Tata Nano and

critically examine the influence of those bottlenecks •  debate on the success of Tata Nano car in the wake of consumers’ post-

purchase perceptions and assess their levels of dissonance •  raise a general debate on addressing all the possible cognitive dissonance

touch points in the case of new products – launched either by an existing and established company or a new company.

OBJECTIVES

“I observed families riding on two-wheelers, the father driving the scooter, his young kid standing in front of him, his wife seated behind him holding a little baby. It led me to wonder whether one could conceive of a safe, affordable, all-weather form of transport for such a family. Tata Motors‘ engineers & designers gave their all in 4 years to realize this goal. Today, we indeed have a People's Car, which is affordable & yet built to meet safety requirements & emission norms, to be fuel efficient & low on emissions. We are happy to present the People's Car to India & we hope it brings the joy, pride & utility of owning a car to many families who need personal mobility.”

INTRODUCTION

Conceptualisation of Nano

2003

January 10th, 2008

2009 23rd 2009

First media appearance of Nano

Nano rolled out to the masses

at 9th Annual Delhi Auto Expo, Ratan Tata published the small car – Nano as India’s first contribution to the global automobile industry, the world’s cheapest car

Tata Nano – World's Cheapest Car:���Causes and Concerns

“It is a ground breaking product”, Ford’s executive vice president, John Parker said. “the Nano will cause people to think differently about the car, I have a lot of respect for Tata.”

•  Anand Mahindra, managing director for Mahindra & Mahindra, Tata Motors primary competitor, ”I think it’s moment of history and I’m delighted an Indian company is leading the way.”

•  Shinzo Nakanishi, managing director of Maruti Suzuki, India, “We don’t know how to make a 1-lakh car unless we sacrifice something.”

•  The Times of India carried an article “Tata reinvents the wheel”

•  Financial Times, UK called it “The new Model T”

From Conceptualisation to the Making of a Miracle •  Ratan Tata want to make a low-cost

car and be a mode of transportation in India : a small car

•  First mule with a engine of 20 bhp &

engine capacity 554 cc, it couldn’t meet the requirement

•  Further, increased to 27 bhp &

engine capacity 586 cc •  By 2006, Nano first prototype ‘alpha’ was tested, with redesigned die-cast engine of 624 cc & 37 bhp

Next big challenge •  cost reduction in entire process

include material, components, design & human resources without compromising on quality, performance & style

•  persuade vendors to produce components at low costs by forced suppliers to re-streamline their entire process to meet specifications of cost, performance & safety regulations

•  West Bengal government made Ratan Tata to announce the launch of the small car project at Singur

Small Car – Big Hopes: The Outcome of Tata Nano Amid All the Roadblocks

•  Since the West Bengal government alloted land for Nano project at Singur in August 2008, the issue was politicised by the opposition leader

•  They demanded the

return of 400 acres of farmer’s land

Further, the presentation of Nano Europa (variant targeted for int’l markets) at the 79th Geneva Motor Show on March 3rd 2009, stimulated global interest about small car

“We don’t want customers to wait for the car, as my friend (Fiat chairman Luca Cordero) Montezemolo said in Paris, waiting to buy a car is like waiting for a pretty woman. If you wait too long, she might get old an fat.”

Nano Variants with Features Items/Variants Nano

Standard Nano Delux CX Nano Luxury LX

AC with Heater - Yes Yes Front Power Windows - - Yes Cup Holders in Front Console - - Yes IRVM Plain Plain Antiglare

Gear Shift Console Basic Basic High End Console with Provision for Mobile

Charger Magazine and coin Holder on all doors - - Moulded Door Trim

Map pocket Integral with Driver & Codriver Seat

Fabric pocket Fabric pocket Separate plastic trim

Front Seat Headrests Integrated Integrated Integrated

Rear Seat Headrests - Integrated (With Nap Rests)

Integrated (With Nap Rests)

Items/Variants Nano Standard Nano Delux CX Nano Luxury LX Sunvisor on Driver & Passenger side Yes Yes Yes

Driver Seat with Slider Yes Yes (With Recliner) Yes (With Recliner)

Passenger side Seat with Slider - Yes (With Recliner) Yes (With Recliner)

Front assist grips Yes Yes Yes Rear assist grips Yes Yes Yes

Head lamp levelling Integral feature

through innovative suspension design

Integral feature through innovative suspension design

Integral feature through innovative suspension design

Low Fuel Warning Lamp Yes Yes Yes

Rear Seat Folding Yes Yes Yes

Intrusion beam Integral feature

through innovative door system design

Integral feature through innovative door system design

Integral feature through innovative door system design

Small Car – Big Hopes: The Outcome of Tata Nano Amid All the Roadblocks

•  Marketing strategies focused on viral marketing, innovative public relations, web search, limited print and other media advertising

•  Marketing innovation with an interactive website – http://tatanano.inservices.tatamotors.com/

•  Its booking on the website was open from April 9th to April 23rd 2009; the delivery began in early July 2009

•  Applications for booking of the car would be available in 30000 locations in 1000 cities across India

•  Car can be booked by just paying Rs 2999 upfront while the rest by loan

Annexure I (b): Questionnaire's Intended Content                                                                                                                                                                                                                                                                                     Product - price performance                

          Experience with the Dealer/���Customer Service  

             

Buying Decision

Following up With Nano's Developments during the

announcement - booking-delivery stage

Delivery Product Experience

Tata Nano

Brand Loyalty

1

2

3 4

5

Annexure I (a): Questionnaire SI. No. Data Field Response

1 Name   2 Age   3 Occupation / Profession   4 Annual Income   5 Previously-Owned Personal Transportaton (a) Car/Cars (b) Bike 6 Currently owning cars (a) (b) 7 Used Tata's passanger cars (Indica, Indigo) before   8 Came to know first about Tata's Nano through   9 Decided to buy when   10 Was following up on the Nano's developments   11 Reacting to the Nano's developments   12 Took the delivery of Nano on, from (the dealer):   13 How was the booking and delivery process   14 Had been using Nano for:   15 How was CRM from the dealer   16 How has been the experience of driving Nano  

17 What you wish Nano would have had/ ���Nano could have given you  

18 Would you recommend Nano to someone (a) 200% (b) 100%���(c) 50% (d) No

Tata  Nano  –  Common  Man's  car  –  Uncommon  Percep4ons  

•  Customer 2

Tata  Nano  –  Common  Man's  car  –  Uncommon  Percep4ons  

•  Customer 3

Tata  Nano  –  Common  Man's  car  –  Uncommon  Percep4ons  

•  Customer 4

Tata  Nano  –  Common  Man's  car  –  Uncommon  Percep4ons  

•  Customer 5

Tata  Nano  –  Common  Man's  car  –  Uncommon  Percep4ons  

•  Customer 6

Tata  Nano  –  Common  Man's  car  –  Uncommon  Percep4ons  

•  Customer 7

Tata  Nano  –  Common  Man's  car  –  Uncommon  Percep4ons  

•  Customer 8

The RoadAhead

•  Despite the buzz created by the Nano as the cheapest car, the customer’s perceptions are mixed

•  At the time this case was published, majority of Tata Nano customers are not from ‘scooter migrators’

•  The prime suspect is the price •  On March 8th 2010, Tata launched a customer service

initiative •  It comprised of 24x7 on-road assistance, fast repairing

service, etc

Annexure II: Tata Nano: Consumer's Profiles and Perception

Customer Name Om Prakash Jain

Jain Kumar Agarwal

Satish���Desai K.S.Rao Dr.Shyam

Sunder Dr.Gayatri

Devi Kamala

Srinivasan M.Sita Age 60 45 51 70 50 40 55 34 Occupation Business Business Business Consultant Consultant

Physician Ayurvedic Physician

Retd. School Teacher

Resource Manager

Annual Income���in INR Lakhs,���Per annum

2.5 4-5 5-6 10 8 2 1 3

Previously-Owned vehicles for Personal Transportaton

Honda Activa Bajaj Chetak Cars Hyundai Accent Cars No

Hero Honda Bike, Maruti

800 Bike

Currently owning others cars

Maruti Alto, Maruti Swift Maruti 800

Cevrolet Optra, Maruti Esteem

Maruti SX4 Honda City No No No

Used Tata's vehicles earlier

Indica���for 2 yrs No Tata Estate No No No No No

First info about Nano

Auto Expo���Jan 8th 2008

Auto Expo���Jan 8th 2008

Media Media Media Auto Expo���

Jan 8th 2008

Media Media

Decided to buy when ?

At the moment of its

launch

At the opening of Bookings

When announced

the allotment

When Booking Started

Auto Expo���Jan 8th 2008

At the time���of its launch

Booking started

Booking started

Was following up on the Nano's developments

Yes Yes Yes From the beginning Yes Yes Yes Yes

Reacting to the Nano's developments

Had faith in���TATAs since���

50 years

Publicity-occupying

1000 acres of land

No���Comments Yes No issues

Prestigious issue for

Ratan Tata Positive Faith in Brand

TATA

Annexure II: Tata Nano: Consumer's Profiles and Perception Got the car on - Dealer: Malik Cars, Banjara Hills, Hyderabad

September���27th 2009

December���11th 2009

August���17th 2009

September���11th 2009

1st week of January

2010 January���

2nd 2009 November���

2009 September���28th 2009

Model of Nano���(Basic, CX, LX) LX LX LX LX LX LX CX LX

Cost of Nano���(in INR Lakhs) >2 >2 2.08 2.08 2.06 2.03 1.85 2.08

Hassles in the booking and���delivery process

Hassel were from SBI

(Banker Side) But the

Dealer helped

Delays in financial

matters from delaer

Comfortable, no hassles Hassel Free No Hassel free

good Prompt Excellent

Had been using Nano for 4 months 2 months 6 months 2 months 3 weeks 3 weeks 3 months 3 months

CRM from the���dealer Good Not Good Good Excellent Good Excellent Good Not up to

expectation Nano's driving Experience Beautiful Not Good Great Mixed Good Fabulous Nice Easy to

handle

Wish Nano could had

Provision for Music

System

Side Vision mirrors without Pillars

High end version with

5 gears, Accesibility

to rear engine

Accesibility for engine,

Better interiors, Standard fitments

Sans Rumble, Space for Luggage,

Power steering

Reduce the height levels of the seats

and the luggage space

Provison of Dickey

Luggage space, left

view mirror

Level of confidence in recommending it to others

100% 0% 200%���

100% for���first time���

buyers Yes 200% 100% 200% 100%

The RoadAhead

Launching this initiative, the President of Passenger Cars at Tata, Rajiv Dube said, “ We want to create deeper customer connect and believe that through Tata Motors Service Edge, we will achive greater levels of satisfaction.”