Posts Tagged ‘Tata’
What is a Brand?
The names Tata, Nokia, Google and many others are one of the biggest brands in the world. So what really is the name Tata or Google is? Is it just a name or more than that?
I define Brand as ‘a network of experience’. Let us understand brands with the example of Google. If I ask you to write a phrase that describes Google, most people would say innovation, technology, cutting-edge research, great brains, great technology, information to the world etc.
Take a moment and think why we say those phrases.
- Because we experience the innovation of Google.
- Because we hear people experiencing the innovation of Google.
- Because we hear the aspirations of Google
- Because we see such brains at Google
- Because Google says so
and some other reasons.
If you observe carefully, what we said is what we experienced. A brand is an experience, in fact, it is the perception derived out of the experience. Suppose you used a Tata car for some years and your experience is as follows:
Experience: The car gives good mileage and requires minimum maintenance.
Perception: You automatically create a perception that Tata cars require less maintenance and have great mileage. Wrong!! You will actually think ‘Tata’ gives great mileage and requires less maintenance. This is the trick, what we experience is not exactly what we perceive. Why?
When we experience the car, we realize this is something good for us. When we see the name on the steering or anywhere on the car we see ‘Tata’. So whatever good experience we had, we immediately map it to the name ‘Tata’ because that is what we see.
The brand ‘Tata’ is created!!
The qualities of a product are perceived to be the qualities of the name present on the product. Simply, people perceive the qualities of the product to be the qualities of the brand name. Why? Because that is the only way they can distinguish between the products. Later, any product coming out of that brand, we associate the qualities of the brand to the product. It is:
Product Qualities à Brand Qualitiesà New Product Qualities
So remember that brand is a perception. Perception is the result of something. Perception cannot be created but can be influenced.
A brand is what your product is, how your product behaves, the experience of everything, the perception of the product, etc. So, marketers use all these techniques to influence your perception of the brand.
Creating a brand is all about creating a unique experience, which is also called differentiation. Remember this differentiation need not only come from the product, but from any experience.
So when people perceive Woodland shoes to be tough, people perceive Woodland to be tough. So marketers will look for category opportunities where this perception can be leveraged like leather bags, etc.
Once you have a perception. You may
- Look for opportunities to leverage this perception (Woodland example, Tropicana as breakfast)
- Change the perception into something else
- Strengthen the perception and grow into areas which strengthens the brand perception
- Come out of the perception totally
- Leverage the perception across other categories and to enter new markets
So, the perception may be the country of origin of the brand, the visuals used, qualities and almost everything of everything can be used to perceive. So, all these are elements present in brands and branding.
Remember every business action results in a perception, and perception creates your brand. Branding is pretty much the affect and how you influence/manage the affect by using the parameters of perception.
This is the brief introduction about Brands and Branding. Thank you
Brand Positioning and Product Positioning
Brand Positioning is the perception of the brand, and Product positioning is the perception of the product. Your product positioning may or may not influence a change in the brand positioning. Example: Tata Nano is the product and Tata is the brand. The perception of the brand ‘Tata’ changes due to the launch of the product Tata Nano. Similarly, Tropicana positioned as a breakfast drink. Here we are trying to change the perception of the usage of Tropicana (banking on the health perception of the drink) which is a product positioning. There is no change in the brand positioning, however, the brand will be more seen in the household and there will be some affect of this product positioning on the brand.
Similarly, sometimes a change in brand positioning is required and is achieved by new product launches and price modelling etc. Example Van Heusen wants to be seen as a youthful brand, so it launches or comes up with promotions in that line to influence the perception of the consumer.
The second car of the Urban
The Tata Nano may well turn out to be the second car of the Urban Consumer. Working couples who own a single car, face difficulty to commute to different offices daily as the husband drops his wife and then goes to his office. These people will not mind to own a Tata Nano as their second car because they have already established their status symbol with a more reliable first car.
Activities of eve-teasing and Ram-Sena activities have beaten women into insecurity. So young girls in college, and women may contemplate to buy a more secure personal transport even at thrice the price of a two-wheeler. Also, a car is much safer than a scooter. Rich Dad will be happy as he spends less money on his son’s or daughter’s car. Though this is not a big market, students in urban cities are a potential niche segment.
First time buyers are more cautious and look at a car as a long term investment. For most of the Urban population, buying a car is not a problem, but maintaining a car is a problem. So, they will never buy a Tata Nano against much better cars, especially when there are good models in the 3 lakh segment like the Maruti Alto. Most of my friends say they will buy a Maruti against a Nano.
As already said, Tata Nano may well be the second car of the Urban but I doubt if it can make a dent to the first time buyer’s segment in Urban areas. Most of the people in India will be first time buyers for whom a car is a status symbol, a symbol of their progress into the rich community. They wouldn’t like to buy a car branded as Aam Aadmi’s Car, because they don’t like to see themselves as an Aam Aadmi anymore.
Rural and lower middle-class in India
Rural markets constitute around 8 percent of the Maruti’s overall domestic sales. With the urban markets looking for luxury cars, the rural market is the segment where Nano completely fits in and its competitive price is just what the doctor ordered. Efficient distribution channels, and providing financial support through bank loans are some of the key initiatives where the automobile giants concentrate on to tap the Indian rural markets.
With Maruti’s strong presence in the rural markets, things may not be easy for the Tatas and Hyundais. With Tata’s water filter ‘Swach’ entering the rural market, if it can create trust in the brand ‘Tata’ then it brings the rural consumer closer to Tata Nano. The Tata Group seems to have a double strategy addressing the ‘Bottom of the pyramid’ market.
Autorickshaws and Taxis – A simple ‘No’
There is no disagreement that Tata Nano with its fiber body, 624 cc, and small space cannot play the role of a taxi and is simply not the vehicle for the highways. But Nano replacing the Autorickshaws is debatable. I spoke to a few auto-drivers around in Hyderabad and they seem to be excited at Nano but not without some concerns.
- Nano cannot move into slum areas as easily as an Autorickshaw.
- Mileage is an issue for the auto-driver.
- Cost of repair and maintenance
- Transition in the image from an auto-driver to a car-driver
- Return on Investment doesn’t seem to be promising.
India exports more cars than world’s biggest car manufacturer China and exports are growing faster than domestic sales, e.g. Hyundai plans to export 300,000 cars from India in 2009, more than its sales in the Indian local market. In 2008, Hyundai Motors alone exported 240,000 cars made in India. Nissan Motors plans to export 250,000 vehicles manufactured in its India plant by 2011. Similarly, General Motors announced its plans to export about 50,000 cars manufactured in India by 2011.
Asia Pacific and Africa
Tata Motors is looking forward to launch in South Africa, Kenya, Uganda, Nepal and other markets with weak public transport system. “Tata Motors will make the Nano available in Nigeria in the next one year to one and a half years,” a senior official of Tata Africa Nigeria, Sudeep Ray, said.
Also Tata Motors is planning to launch in European markets, Italian car maker Fiat SpA and Tata Motors Ltd intend to sell Tata’s ultra-low-cost Nano model jointly in Latin America.
Will this ‘Nano’ revolution last long?
Tata Nano is a revolution in car making, and buying a car will never be the same again. The question is: How long?