One thing that Crystal emphasis on her blog is that TATA’s big problem was the Marketing and I couldn’t agree more on that.
The perception is really an important point which should have been considered by TATA people before deciding the price. Lower middle class wants a car that apart from solving their transportation needs, should also get them a superior status on the roads. TATA people completely neglected this fact and put all their resources in making the car cheap.
Nano was a car with mixed opinion in the market. The marketing campaign of Nano was a blunder too. The company should never have used the word cheapest car. Majority of people misinterpret the word cheapest by relating it to the quality standard. This fact was even accepted by Mr. Ratan himself. Ratan Tata says calling Nano the ‘cheapest car’ was a mistake.
Positioning is the key to selling a product. Positioning helps create an image for a product or brand or even company. How the potential customers perceive a product is very important. This is where Tata Motor’s failed miserably. Nano’s positioning as a “cheap” car killed the aspirational element in the car and the performance of the model has been terribly underwhelming over the years.
Crystal’s blog: http://blogs.ubc.ca/yuhsuanko/
External research:
http://profit.ndtv.com/news/industries/article-ratan-tata-says-calling-nano-the-cheapest-car-was-a-mistake-373603
http://www.businessweek.com/managing/content/jan2011/ca20110111_359394.htm
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