Survey for the Demand of Scv

8/3/2019 Survey for the Demand of Scv

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SURVEY FOR THE DEMAND OF SCV-PASSENGERS OF TATA

MOTORS IN RURAL AREAS

Summer Internship Project Report

Submitted towards Partial

Fulfillment

Of

Post Graduate Diploma in Management

(Approved by AICTE, Govt. of India)

Academic Session

2010-2012

Under the Guidance of: Submitted by:

Industry Guide Siddharth Kumar Mishra

Ashutosh Sinha BM010146

MANAGER- CVBU FACULTY GUIDE:

PASSENGER (SALES) Anagha Shukre

TATA MOTORS Chairperson PGDM (Marketing)

IMS, Ghaziabad


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PREFACE

Summer training is an integral part of PGDM to undergo a training session inbusiness organization for 8 weeks to gain practical knowledge in theirspecialization and to gain some experience of what he/she is to face in real world.Theoretical knowledge only provides basic concept about the study. It doesntguarantee success in practical problem. Further, the market condition, technologyhas changed tremendously these days. It has lead to growth in the market size andcomplexity in business

It is from here we learn our flown before actually stepping into our

working shoes. It adds to knowledge and better understanding of the organization.

This project has greatly helped in giving shape to my effort of understanding the

practical field


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ACKNOWLEDGEMENT

An undertaking of work life, this is never an outcome of a single person; rather it

bears the imprints of a number of people who directly or indirectly helped me in

completing this project report. I would have failed in my duties if I dont say a

word of thanks to all those who made this report a grand success.

I am heartily thankful to my company guide Mr. ASHUTOSH SINHA whose

encouragement, guidance and support from the initial to final level enabled me to

develop an understanding of the topic. Also I would like to thank various dealers of

MITHILA MOTORS for their valuable guidance and support.


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TABLE OF CONTENTS

1.Executive summary... 7

2.Introduction about the project..... 8

3.Indian Automobile Industry13

4.Indian commercial vehicle market..145. About the company...15

6.Comparison of three commercial vehicles..20

7.Economies of road transport operation..26

8.SWOT analysis of tata motors.27

9.Rural Marketing...29

10.Rural Market Potential30

11.Challenges in Rural marketing...33

12. Solution to problem of rural market.36

13.Rural Penetration.38

a) PMGSY.39

b)NGO..41

14. Statistical Tools...43

15.Conclusion55

16.References56


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LIST OF TABLE/ GRAPHS/ FIGURES


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EXECUTIVE SUMMARY

Automotive industry is one of the major businesses in todays world and to survivethe intense competition in a market like that of India, an organisation has to adoptand effective marketing strategy. Organizations are spending millions of rupees onmarketing of their products to ensure perpetual existence in the market.The objective of adopting intensive and diverse marketing strategies is1. To increase the sales.2. To maximize the profits.3. To ensure long-term establishment.4. To capitalize a major market share.

Purpose :The purpose of preparing this project was to study the marketing techniquesadopted by Tata Motors in Rural areas and I have tried to include information notonly on the marketing strategy of Tata Motors but also on the profile of entire TataGroup. It was great pleasure studying various products of Tata Motors and theirmarketing techniques and it has helped me to know the innovative marketing

trends in Automobile Industry. My research emphasizes on the marketing strategyused by Tata Motors. The highlights of this study are :

1. To Understand the techniques of Advertisement, sales promotion and salesadopted by the company.

2. To Understand the Before and After Sales Services provided.3. To Understand the Marketing Mix adopted by the Co.


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INTRODUCTION OF THE COMPANY

Tata motors is a multinational automotive corporation headquartered in Mumbai,India. Part of the Tata Group, it was formerly known as TELCO (TATAEngineering and Locomotive Company).Tata Motors is Indias largestautomobilecompany, with consolidated revenues of USD 20 billion in 2009-10. It is the leaderin commercial vehicles and among the top three in passenger vehicles. Tata Motorshas products in the compact, midsize car and utility vehicle segments. The

company is the world's fourth largest truck manufacturer, the world's secondlargest bus manufacturer, and employs 24,000 workers. Since first rolled out in1954, Tata Motors has produced and sold over 4 million vehicles in India.Established in 1945, when the company began manufacturing locomotives, thecompany manufactured its first commercial vehicle in 1954 in collaboration withDaimler-Benz AG, which ended in 1969. Tata Motors is a dual-listed companytraded on both the Bombay Stock Exchange, as well as on the New York StockExchange. Tata Motors in 2005 was ranked among the top 10 corporations in Indiawith an annual revenue exceeding INR 320 billion. In 2010, Tata Motors surpassed

Reliance to win the coveted title of 'India's most valuable brand' in an annualsurvey conducted by Brand Finance and The Economic Times.

Tata Motors has auto manufacturing and assembly plants in Jamshedpur,Pantnagar, Lucknow,Ahmadabad, Sanand, Dharwad and Pune in India, as well asin Argentina, South Africa and Thailand.

Tata Motors is a part of the Tata Group manages its share-holding through TataSons. The company was established in 1950 as a locomotive manufacturing unitand later expanded its operations to commercial vehicle sector in 1954 after

forming a joint venture with Daimler-Benz AG of Germany. Despite the success ofits commercial vehicles, Tata realized his company had to diversify and he beganto look at other products. Based on consumer demand, he decided that building asmall car would be the most practical new venture. So in 1998 it launched TataIndica, India's first fully indigenous passenger car.
http://en.wikipedia.org/wiki/Multinational_corporationhttp://en.wikipedia.org/wiki/Automotive_industryhttp://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Tata_Grouphttp://en.wikipedia.org/wiki/Automobilehttp://en.wikipedia.org/wiki/Automobilehttp://en.wikipedia.org/wiki/Commercial_vehicleshttp://en.wikipedia.org/wiki/Locomotiveshttp://en.wikipedia.org/wiki/Daimler-Benzhttp://en.wikipedia.org/wiki/Dual-listed_companyhttp://en.wikipedia.org/wiki/Bombay_Stock_Exchangehttp://en.wikipedia.org/wiki/New_York_Stock_Exchangehttp://en.wikipedia.org/wiki/New_York_Stock_Exchangehttp://en.wikipedia.org/wiki/Indian_rupeehttp://en.wikipedia.org/wiki/Jamshedpurhttp://en.wikipedia.org/wiki/Pantnagarhttp://en.wikipedia.org/wiki/Lucknowhttp://en.wikipedia.org/wiki/Ahmedabadhttp://en.wikipedia.org/wiki/Sanandhttp://en.wikipedia.org/wiki/Dharwadhttp://en.wikipedia.org/wiki/Punehttp://en.wikipedia.org/wiki/Tata_Grouphttp://en.wikipedia.org/wiki/Tata_Sonshttp://en.wikipedia.org/wiki/Tata_Sonshttp://en.wikipedia.org/wiki/Daimler-Benzhttp://en.wikipedia.org/wiki/Consumerhttp://en.wikipedia.org/wiki/Tata_Indicahttp://en.wikipedia.org/wiki/Tata_Indicahttp://en.wikipedia.org/wiki/Tata_Indicahttp://en.wikipedia.org/wiki/Tata_Indicahttp://en.wikipedia.org/wiki/Consumerhttp://en.wikipedia.org/wiki/Daimler-Benzhttp://en.wikipedia.org/wiki/Tata_Sonshttp://en.wikipedia.org/wiki/Tata_Sonshttp://en.wikipedia.org/wiki/Tata_Grouphttp://en.wikipedia.org/wiki/Punehttp://en.wikipedia.org/wiki/Dharwadhttp://en.wikipedia.org/wiki/Sanandhttp://en.wikipedia.org/wiki/Ahmedabadhttp://en.wikipedia.org/wiki/Lucknowhttp://en.wikipedia.org/wiki/Pantnagarhttp://en.wikipedia.org/wiki/Jamshedpurhttp://en.wikipedia.org/wiki/Indian_rupeehttp://en.wikipedia.org/wiki/New_York_Stock_Exchangehttp://en.wikipedia.org/wiki/New_York_Stock_Exchangehttp://en.wikipedia.org/wiki/Bombay_Stock_Exchangehttp://en.wikipedia.org/wiki/Dual-listed_companyhttp://en.wikipedia.org/wiki/Daimler-Benzhttp://en.wikipedia.org/wiki/Locomotiveshttp://en.wikipedia.org/wiki/Commercial_vehicleshttp://en.wikipedia.org/wiki/Automobilehttp://en.wikipedia.org/wiki/Tata_Grouphttp://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Automotive_industryhttp://en.wikipedia.org/wiki/Multinational_corporation


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ACQUISITIONS:

In 2004 Tata Motors acquired Daewoo's truck manufacturing unit, nowknown as Tata Daewoo Commercial Vehicle, in South Korea.

In 2005, Tata Motors acquired 21% ofAragonese Hispano Carrocera givingit controlling rights of the company.

In 2007, formed a joint venture with Marcopolo of Brazil and introducedlow-floor buses in the Indian Market. In 2008, Tata Motors acquired BritishJaguar Land Rover (JLR), which includes the Daimler and Lanchester brandnames.

In 2010, Tata Motors acquired 80% stake in Italy-based design andengineering company Trilix for a consideration of 1.85 million. The

acquisition is in line with the companys objective to enhance itsstyling/design capabilities to global standards.

After years of dominating the commercial vehicle market in India, TataMotors entered the passenger vehicle market in 1991 by launching the TataSierra, a multi utility vehicle. After the launch of three more vehicles, TataEstate (1992, a station wagon design based on the earlier 'Tata Mobile'(1989), a light commercial vehicle), Tata Sumo (LCV, 1994) and Tata Safari(1998, India's first sports utility vehicle). Tata launched the Indica in 1998,the first fully indigenous passenger car of India. Though the car was initiallyplanned by auto-analysts, the car's excellent fuel economy, powerful engineand aggressive marketing strategy made it one of the best selling cars in thehistory of the Indian automobile industry. A newer version of the car, namedIndica V2, was a major improvement over the previous version and quicklybecame a mass-favorite. Tata Motors also successfully exported largequantities of the car to South Africa. The success of Indica in many waysmarked the rise of Tata Motors.

JOINT VENTURES

Tata Marcopolo released a low-floor bus in India and now it is widely usedas public transport in Delhi, Mumbai, Chennai, Bangalore, Chandigarh andLucknow.
http://en.wikipedia.org/wiki/Tata_Daewoo_Commercial_Vehiclehttp://en.wikipedia.org/wiki/Arag%C3%B3nhttp://en.wikipedia.org/wiki/Hispano_Carrocerahttp://en.wikipedia.org/wiki/Marcopolo_S.A.http://en.wikipedia.org/wiki/Tata_Sierrahttp://en.wikipedia.org/wiki/Tata_Sierrahttp://en.wikipedia.org/wiki/Tata_Estatehttp://en.wikipedia.org/wiki/Tata_Estatehttp://en.wikipedia.org/wiki/Stationwagonhttp://en.wikipedia.org/wiki/Tata_Sumohttp://en.wikipedia.org/wiki/Tata_Indicahttp://en.wikipedia.org/wiki/Tata_Indicahttp://en.wikipedia.org/wiki/Tata_Sumohttp://en.wikipedia.org/wiki/Stationwagonhttp://en.wikipedia.org/wiki/Tata_Estatehttp://en.wikipedia.org/wiki/Tata_Estatehttp://en.wikipedia.org/wiki/Tata_Sierrahttp://en.wikipedia.org/wiki/Tata_Sierrahttp://en.wikipedia.org/wiki/Marcopolo_S.A.http://en.wikipedia.org/wiki/Hispano_Carrocerahttp://en.wikipedia.org/wiki/Arag%C3%B3nhttp://en.wikipedia.org/wiki/Tata_Daewoo_Commercial_Vehicle


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Tata Motors has formed a 51:49 joint venture in bus body building withMarcopolo of Brazil. This joint venture is to manufacture and assemblefully-built buses and coaches targeted at developing mass rapidtransportation systems. The joint venture will absorb technology and

expertise in chassis and aggregates from Tata Motors, and Marcopolo willprovide know-how in processes and systems for bodybuilding and bus bodydesign. Tata and Marcopolo have launched a low-floor city bus which iswidely used by Chennai, Coimbatore, Delhi, Mumbai, Lucknow andBangalore transport corporations. Its manufacturing facility is based inDharwad.

Tata Motors also formed a joint venture with Fiat and gained access to Fiatsdiesel engine technology. Tata Motors sells Fiat cars in India through a50/50 joint venture Fiat Automobiles India Limited, and is looking to extendits relationship with Fiat and Iveco to other segments. Tata has also formedseveral JV's with many small companies in various countries around theworld.

Sales & Service Network

Tata Motors has more than 250 dealerships in more than 195 cities across 27states and 4 Union Territories of India. It has the 3rd largest Sales andService Network after Maruti Suzuki and Hyundai.
http://en.wikipedia.org/wiki/Marcopolo_S.A.http://en.wikipedia.org/wiki/Joint_venturehttp://en.wikipedia.org/wiki/Fiathttp://en.wikipedia.org/wiki/Diesel_enginehttp://en.wikipedia.org/wiki/Fiat_Automobiles_India_Limitedhttp://en.wikipedia.org/wiki/Ivecohttp://en.wikipedia.org/wiki/States_of_Indiahttp://en.wikipedia.org/wiki/Union_Territoryhttp://en.wikipedia.org/wiki/Maruti_Suzukihttp://en.wikipedia.org/wiki/Hyundai_Motor_India_Limitedhttp://en.wikipedia.org/wiki/Hyundai_Motor_India_Limitedhttp://en.wikipedia.org/wiki/Maruti_Suzukihttp://en.wikipedia.org/wiki/Union_Territoryhttp://en.wikipedia.org/wiki/States_of_Indiahttp://en.wikipedia.org/wiki/Ivecohttp://en.wikipedia.org/wiki/Fiat_Automobiles_India_Limitedhttp://en.wikipedia.org/wiki/Diesel_enginehttp://en.wikipedia.org/wiki/Fiathttp://en.wikipedia.org/wiki/Joint_venturehttp://en.wikipedia.org/wiki/Marcopolo_S.A.


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OBJECTIVES OF THE PROJECT

To know the customers perception about the SCV vehicles of

TATA MOTORS.

To know the competitors of TATA MOTORS SCV passenger

vehicles in the Rural market.

To know the various attributes that affect the purchase decision of

an individual.


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INDIAN AUTOMOBILE INDUSTRY

The Indian Automobile Industry is manufacturing over 11 million vehicles and

exporting about 1.5 million every year.[18] The dominant products of the industry

are two wheelers with a market share of over 75% and passenger cars with a

market share of about 16%.[18] Commercial vehicles and three wheelers share

about 9% of the market between them. About 91% of the vehicles sold are used by

households and only about 9% for commercial purposes.[18] The industry has

attained a turnover of more than USD 35 billion and provides direct and indirect

employment to over 13 million people.[18]

The supply chain of this industry in India is very similar to the supply chain of the

automotive industry in Europe and America. This may present its own set of

opportunities and threats. The orders of the industry arise from the bottom of the

supply chain i. e. from the consumers and goes through the automakers and climbs

up until the third tier suppliers. However the products, as channelled in everytraditional automotive industry, flow from the top of the supply chain to reach the

consumers.

Interestingly, the level of trade exports in this sector in India has been medium and

imports have been low. However, this is rapidly changing and both exports and

imports are increasing. The demand determinants of the industry are factors like

affordability, product innovation, infrastructure and price of fuel. Also, the basis of

competition in the sector is high and increasing, and its life cycle stage is growth.

With a rapidly growing middle class, all the advantages of this sector in India areyet to be leveraged.

Note that, with a high cost of developing production facilities, limited accessibility

to new technology and soaring competition, the barriers to enter the Indian

Automotive sector are high. On the other hand, India has a well-developed tax

structure. The power to levy taxes and duties is distributed among the three tiers of


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Government. The cost structure of the industry is fairly traditional, but the

profitability of motor vehicle manufacturers has been rising over the past five

years. Major players, like Tata Motors and Maruti Suzuki have material cost of

about 80% but are recording profits after tax of about 6% to 11%.[18]The level of technology change in the Motor vehicle Industry has been high but,

the rate of change in technology has been medium. Investment in the technology

by the producers has been high. System-suppliers of integrated components and

sub-systems have become the order of the day. However, further investment in

new technologies will help the industry be more competitive. Over the past few

years, the industry has been volatile. Currently, Indias increasing per capita

disposable income which is expected to rise by 106% by 2015[18] and growth in

exports is playing a major role in the rise and competitiveness of the industry.

Tata Motors is leading the commercial vehicle segment with a market share of

about 64%.Maruti Suzuki is leading the passenger vehicle segment with a market

share of 46%.Hyundai Motor India and Mahindra and Mahindra are focusing

expanding their footprint in the overseas market. Hero Honda Motors is occupying

over 41% and sharing 26%[18] of the two wheeler market in India with Bajaj

Auto. Bajaj Auto in itself is occupying about 58% of the three wheeler market.

Consumers are very important of the survival of the Motor Vehicle manufacturingindustry. In 2008-09, customer sentiment dropped, which burned on the

augmentation in demand of cars. Steel is the major input used by manufacturers

and the rise in price of steel is putting a cost pressure on manufacturers and cost is

getting transferred to the end consumer. The price of oil and petrol affect the

driving habits of consumers and the type of car they buy.

The key to success in the industry is to improve labour productivity, labour

flexibility, and capital efficiency. Having quality manpower, infrastructure

improvements, and raw material availability also play a major role. Access to latestand most efficient technology and techniques will bring competitive advantage to

the major players. Utilising manufacturing plants to optimum level and

understanding implications from the government policies are the essentials in the

Automotive Industry of India.


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Both, Industry and Indian Government are obligated to intervene the Indian

Automotive industry. The Indian government should facilitate infrastructure

creation, create favourable and predictable business environment, attract

investment and promote research and development. The role of Industry will

primarily be in designing and manufacturing products of world-class quality

establishing cost competitiveness and improving productivity in labour and in

capital. With a combined effort, the Indian Automotive industry will emerge as the

destination of choice in the world for design and manufacturing of automobiles.

INDIAN COMMERCIAL VEHICLE MARKET

The commercial vehicle segment of the Indian automobile industry has showngreat recovery after fending off the effects of the global economic crisis. Theimpact on the industry was mostly due to the stunted infrastructural projects andthe lack of development in other industries, which require commercial vehicles.However, once the market started booming, the segment made its way back intothe high growth zone, which started during 2009-10. Growth continued in 2010-11also, with the production and sales of the industry and individual companies

reaching new heights. The most profitable and quickly growing segments havebeen goods and passenger carriers. This can be attributed to the rapid expansion ofcities and suburban areas, which is expected to continue in future as well. Keepingthis in mind, we have projected the sales of commercial passenger carriers toregister around 14% CAGR during 2011-12 to 2014-15.

At the utility vehicle front, the country posted one of the fastest year-on-yearproduction growths in 2009-10. Growth further stabilized during 2010-11 as thebalance between demand and supply was attained after the sudden surge ofdemand during the post-recession scenario. With recovering vehicle demand from

schools, corporate, and public sector organizations, the production grew strongly in2010-11. We anticipate this trend to continue in coming years also, thus enablingthe country to become a dominant utility vehicle player in the global arena. Manynew product launches are also expected in the segment of LCV and MUV in thecoming two financial years.


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SMALL COMMERCIAL VEHICLES

In India the Small Commercial Vehicle (SCV) segment was created by the

launch of Tata Ace in May 2005. This category can roughly be characterized as

sub 1000cc engine and less than 3.5 tonnes of weight. This segment competes

the prevailing three-wheeler segment on the basis of cost, durability and newpollution control laws.

Mini trucks are suitable for short intra-city deliveries, plying on narrow village

roads, long highway hauls carrying small bulky loads or even heavy cargo.

Before the coming of mini trucks to India, this segment was being catered by

three-wheelers. With the Supreme Court of India's ban of overloading of cargo

vehicles and restrictions on the entry of heavy commercial vehicles into city, the

necessity of an intermediate segment was observed. Tata became the

frontrunner to fill the gap by launching the first mini truck of India Tata Ace.

With the immense popularity of Tata Ace, many other manufacturers from three-

wheeler segment or from Light Commercial Vehicle segment jumped into the

SCV segment.

List of Mini Trucks in India

Tata Ace

Tata Penguin

Piaggio

Ape truck

Mahindra

Mahindra Maxximo
http://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Tata_Acehttp://en.wikipedia.org/wiki/Tata_Acehttp://en.wikipedia.org/w/index.php?title=Tata_Penguin&action=edit&redlink=1http://en.wikipedia.org/wiki/Piaggiohttp://en.wikipedia.org/w/index.php?title=Ape_truk&action=edit&redlink=1http://en.wikipedia.org/wiki/Mahindrahttp://en.wikipedia.org/w/index.php?title=Mahindra_Maxximo&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Mahindra_Maxximo&action=edit&redlink=1http://en.wikipedia.org/wiki/Mahindrahttp://en.wikipedia.org/w/index.php?title=Ape_truk&action=edit&redlink=1http://en.wikipedia.org/wiki/Piaggiohttp://en.wikipedia.org/w/index.php?title=Tata_Penguin&action=edit&redlink=1http://en.wikipedia.org/wiki/Tata_Acehttp://en.wikipedia.org/wiki/Tata_Acehttp://en.wikipedia.org/wiki/India


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Mahindra Gio

HM Winner

Ashok Leyland Dost

Force Trump

PROMOTIONAL ACTIVITIES IN TATA MOTORS:

Its a key ingredient in marketing campaigns consists of a collection of

incentive tools, mostly short term, designed to stimulate quicker or greaterpurchase of particular products or services by customers.

The promotion tools used by Tata motor for its marketing activities are

Demo of vehicles through road show & campaign.

Free test ride to the customer

Sales promotion through sponsoring special events

Sales promotion through various schemes

Advertising

Sales Direct

Personal

Selling

Public
http://en.wikipedia.org/w/index.php?title=Mahindra_Maxximo&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Mahindra_Maxximo&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Mahindra_Maxximo&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Mahindra_Maxximo&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Mahindra_Maxximo&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Mahindra_Maxximo&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Mahindra_Gio&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=HM_Winner&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Ashok_Leyland_Dost&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Force_Trump&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Force_Trump&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Ashok_Leyland_Dost&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=HM_Winner&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Mahindra_Gio&action=edit&redlink=1


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Advertising

1) Road shows & campaign:

Tata motors newly launched vehicle are advertised through Demo activities so that

people get near view of the luxury product of Tata motors.

DEMO ACTIVITY OF NEWLY LAUNCHEDBANNER BEING PUT UP FOR DEMO ACTIVITYTATA VENTURE NEAR ASHINA GARDENSAND AWARNESS IN SONARI

2)TEST RIDE:-

The customer are given free test ride as per the enquiry genrated from the print

media as such news paper.The customer are given detail about the technical

specification of the vechicle. de


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TEST RIDE GIVEN TO MR.SINHA OF RAJENDRA VIDLAYA SCHOOL

,SAKCHI . TEST RIDE GIVEN TO CUSTOMER THROUGH

INQUIRY GENRATED FROM NEWSPAPER.

3) LAUNCHING EVENT:-

tata motors from time to time conduct launching event of its newly launched

vechicle.

Tata venture & winger being launched Tata motor officer giving presentations

about the vehicle at Telco club, Jamshedpur.


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tata motor employee and intern at launching event

4) ADVERTISEMENT:-

Tata motor vehicles are advertised through print and electronic media.

The competition:

Based on the price range and the vehicle sales in the MUV segment over

the past 2 years the major competitors for Tata MUV are Mahindra xylo,

Mahindra bolero, and Toyota innova. The survey done state that most of

the Tata MUV are facing the tough competition. But still the marketing

strategy of Tata motor has kept up its demand and likeness for its MUV

product in the customer mind. Though few people believe that themaintenance cost of some of the Tata MUV is higher as compared to its

competitor. The newly launched Tata venture is facing tough

competition from maruti Eeco, maruti Omni, Mahindra xylo.

Pricing:

Studying the on-road prices of newly launched Tata MUV venture as

collected during the survey, we find that though cheaper competitorwas maruti Eeco, it had not yet launched its compliant variant

yet which would be costlier than venture & winger platinum. Tata

venture gx-price rs 5, 07,000.


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SWOT ANALYSIS OF TATA MOTORS

TATA motors is the market leader in Indian Industry with high market share. TATA motorsbegan in 1945 since then it produced more than 3 million vehicles. TATA motors employedaround 23000 employees and it is expanding with pace.

Strengths

TATA motors is market leader in Automobile Industry with high market share.

TATA Motors Company have huge employee base.

TATA motors employee productivity percentage is higher.

TATA motors produce low price car with low fuel consumption.

TATA motors is the reputable brand in Indian Industry.


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Tata Motors Limited is Indias largest automobile company, with revenues of Rs. 35651.48

crores (USD 8.8 billion) in 2007-08.

The companys dealership, sales, services and spare parts network comprises over 3500 touch

points.

Tata Motors has been aggressively acquiring foreign brands to increase its global presence.

The research and development department of TATA motors is very strong.

TATA motors posses High corporate responsibility.

Weakness

Return on Investment on TATA motors shares in low.

TATA motors is not able to meet safety standards in their vehicles.

The domestic sales of the company are not up to the mark.

Tata has not got a foothold in the luxury car segment in its domestic market.

Opportunities

TATA motors can take the advantage of their low cost car by entering into third world countrieswhere people have low purchasing power.

TATA motors should focus in developing luxury cards.

TATA motors can introduce more safety features in vehicles to gain more customer satisfaction.

Joint ventures in other countries allow TATA motors to easily enter into new market.

Threats

TATA motors have low cost advantage over its competitors, once the competitors find out thelow cost production methodology then there will no competitive advantage.

Other companies are starting to compete for some of this market share. In fact, the PakistansTransmission Motor Company has built a basic four-wheeler for only $2,100. This car isconsiderably cheap and the Pakistan Transmission Motor company started exporting them toSudan, Qatar, and Chile. This is going to be the beginning of new emerging car manufacturesthat will be producing low priced cars.


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The major challenge for TATA motors is the rising prices of steel, Aluminum and plastic whichis heavily used in vehicle manufacturing.

The low safety standards can impact the sales.

SCV VEHICLES OF TATA MOTORS

TATA ACE :

Tata Motors launched the Ace truck in May 2005 for just above Rs 2 lakhs. The

new vehicle was a big hit selling 100,000 in just 20 months. As of May 2010

TATA MOTORS sold over 500,000 ACE's in just 5 Years. ACE is created another

history in the commercial vehicle industry.[1] Currently this truck is only offered in

a single colour (Irish cream), to save time in the paint shop. Tata is building a

new factory that will be able to turn out 250,000 a year starting this month.[1] Tata

Ace has created a new mini segment inIndia. Priced between 2.25 to 3.35lakhs

INR, the company aims to convert three wheeler users to 4 wheelers. One of the

idea that has made the launch of this vehicle might be that the government policy

in India not to allow HMVs (that are categorized by vehicles weighing above 3
http://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Lakhshttp://en.wikipedia.org/wiki/Lakhshttp://en.wikipedia.org/wiki/Lakhshttp://en.wikipedia.org/wiki/Indian_Rupeehttp://en.wikipedia.org/wiki/Indian_Rupeehttp://en.wikipedia.org/wiki/Indian_Rupeehttp://en.wikipedia.org/wiki/Lakhshttp://en.wikipedia.org/wiki/India


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tonnes) to enter cities after 7 p.m. to reduce traffic jams and pollution. TATA has

found the gap in the market and released Ace. The 700 cc engine delivers a

power of 16 hp (12 kW) at 3200 rpm and a torque of 3.8 mkgf(37Nm) at 2000

rpm gives a tough competition to Piaggio's mini truck (3-wheeler). It has apermissible loading capacity of 750 kg (1650 lb). It also has a modern cabin

compared to its three wheeler rivals. It is best suited for use by villagers in

carrying goods over short distances.

TATA MAGIC:

The Tata Magic is aMicrovanlaunched byTata Motorsin June 2007. The Magic

is the passenger version of the Ace mini-truck, the new Magic features an all-

steel cabin. It offers a flexible seating capacity of 4-7 passengers with adequate

legroom. Powered by a 16 bhp (12 kW), 700 cc water-cooled diesel engine, the

Magic offers high fuel efficiency and very low maintenance. The 12-inch tyres

provide higher ground clearance, and the rigid front axle is designed to handle

tough roads. The Magic's turning radius of 4.3 metres (14.1 ft) is nimble enough

to navigate the bylanes and traffic of India's crowded cities. The Magic has a

clearly visible instrument cluster, utility tray and a digital clock in the dashboard

and also a provision for fitting a radio.
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The Magic meets BS-III emission norms and has been developed for use in any

market be it urban, semi-urban or rural. It is backed by a 36,000 km/12-month

warranty. The Magic range starts at Rs 2.60 lakh (ex-showroom, Pune). Tata

Motors' two new vehicles, Magic and Winger, are expected to cater to the two

ends of the taxi segment. The Winger, which is a sturdier and more refined

product, will attempt to wrestle market share in the staff (ITES/ BPO employees)

transportation segments, Hotel & Inter-urban Tourist segments, airport drop and

pickup.

TATA VENTURE :

The Tata Venture is aminivanunveiled on 5 January 2010 at the 10thAutoExpo

in Pragati MaidanbyTata Motorsin India. It is in competition with the prevalent

MPV and vans from Maruti, Mahindra, Toyota, Chevrolet and Force Motors.

Venture is powered by a 1.4-litre turbo diesel engine delivering 90 hp (67 kW)

power, it boasts of the best-in-class fuel efficiency among diesel MPVs in the

INDIA and is available in 5-, 6-, 7- and 8-seater arrangement. It comes withfeatures such as dual heating, ventilation and air-conditioning (HVAC), reverse

parking sensor,power windows, keyless entry andpower steering.
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TATA WINGER PLATINUM :

In June 2007 Tata Motors launched the Tata Winger, on a new platform along

with the passenger variant of the Ace, named Magic. According to Tata Motors

Vice-President (sales and marketing) Mr Shyam Mani, the company's objective is

"to change the way an average Indian travels." [3] Tata Motors' two new vehicles

Magic and Winger will attempt to cater to the two ends of the light commercial

passenger segment [4].It can seat 9 to 13 passengers, comes with generous saloon space, spacious

headroom and legroom, and wide luggage space. Passenger comfort has been

further enhanced with all front-facing seats and, depending on the variant, will

come with magazine pockets, bottle holders, spot lamps and grab handles,

besides provision for a music system.


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COMPARISON OF THREE COMMERCIAL VEHICLESTATA VENTURE, MAHINDRA XYLO

&

CHEVROLET TAVERA

SPECIFICATIONS

Engine

Tata VentureGX

5,07,000

Mahindra XyloE4 BS IV

7,90,400

Chevrolet TaveraB2-7 seats BSIII

7,35,287
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Engine Type Turbo Diesel engine In-Line Engine In-Line Engine

Engine Description 475 IDI, TurboIntercooled DieselEngine

2.5L 112bhp m-EagleCRDe, 4-cyl.Turbocharged

2.5L 80bhp DirectInjection Turbo Diesel

EngineDisplacement(cc)

1405 2498 2499

No. of Cylinders 4 4 4

Maximum Power 71 PS at 4500 rpm 112bhp at 3800 rpm 80 @ 3,900 (PS@rpm)

Maximum Torque 135 Nm at 2500 rpm 260 Nm at 1800-2200rpm

19 @ 1,800(kgm@rpm)

Valves Per Cylinder 4 4 2

Turbo Charger Yes Yes Yes

Transmission-

Steering-

&

Brake System

Tata Venture

GX

5,07,000

Mahindra Xylo

E4 BS IV

7,90,400

Chevrolet Tavera

B2-7 seats BSIII

7,35,287

Transmission Type Manual Manual Manual

Gear box 5 Speed ManualTransmission

5 Speed 5 Speed
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Drive Type Two Wheel Drive Two Wheel Drive Two Wheel Drive

Steering Type Power Manual Manual

Front Brake Type Disc Ventilated Disc Ventilated Disc

Rear Brake Type Drum Drum Drum

Fuel & Other

Specifications

Tata Venture

GX

Mahindra Xylo

E4 BS IV

Chevrolet Tavera

B2-7 seats BSIII

Mileage-City (kmpl) 11.5 11.0 11.5

Mileage-Highway (kmpl) 15.42 14.0 14.8

Fuel Type Diesel Diesel Diesel

Fuel Tank Capacity(litres)

35 55 55

Emission Norm

Compliance

BS III BS IV BS III

Seating Capacity 8 7 7

FEATURES

Comfort &

Convenience

Tata Venture

GX

5,07,000

Mahindra Xylo

E4 BS IV

7,90,400

Chevrolet Tavera

B2-7 seats BSIII

7,35,287

Power Steering Yes Yes No


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Power Windows-Front Yes Yes No

Automatic ClimateControl

No No No

Low Fuel Warning Light Yes Yes Yes

Accessory Power Outlet Yes Yes No

Vanity Mirror Yes No No

Rear Reading Lamp Yes No Yes

Height Adjustable FrontSeat Belts

Yes No No

Cup Holders-Front Yes Yes No

Seat Lumbar Support Yes No No

Interior Tata Venture

GX

Mahindra Xylo

E4 BS IV

Chevrolet

Tavera

B2-7 seats BSIII

Air Conditioner Yes Yes Yes

Heater Yes Yes Yes

Adjustable SteeringColumn

Yes Yes No


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Tachometer Yes No No

Electronic Multi-Tripmeter

Yes No No

Fabric Upholstery Yes No Yes

Glove Compartment Yes No Yes

Digital Clock Yes Yes No

Digital Odometer Yes Yes Yes

Exterior Tata Venture

GX

Mahindra Xylo

E4 BS IV

Chevrolet Tavera

B2-7 seats BSIII

Fog Lights - Front Yes No No

Manually Adjustable Ext.Rear View Mirror

Yes Yes Yes

Rear Window Washer Yes Yes No


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Rear Window Defogger Yes No No

Wheel Covers Yes Yes No

Tinted Glass Yes Yes Yes

IntergratedAntenna Yes No No

SAFETY INFORMATION

SAFETYFEATURES

Tata Venture GX

Price- 5,07,000

Mahindra Xylo

E4 BS IV

Price- 7,90,400

Chevrolet Tavera

B2-7 seats BSIII

Price- 7,35,287


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Power Door Locks Standard Standard Not Available

Child Safety Locks Standard Standard Standard

Passenger Side RearViewMirror

Standard Standard Standard

Halogen Headlamps Standard Standard Standard

Rear Seat Belts Standard Standard Standard

Side Impact Beams Standard Standard Standard

Front Impact Beams Standard Standard Standard

Adjustable Seats Standard Standard Not Available

Engine Immobilizer Standard Standard Not Available

ECONOMIES OF ROAD TRANSPORT OPERATION

AREA OF OPERATION - HALDIPOKHAR & TATA

TYPE OF VEHICLE - TATA MAGIC

COST OF VEHICLE - Rs.- 3,24,283/-

INSURANCE & TAX - 15900 + 4500 = 20,400/-


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AVERAGE NO. OF PER DAY - 25

AVERAGE RUN PER DAY - 50 KM ( 50 X 4 = 200 KM) 4 TRIPS PER DAY

AVERAGE EARNING PER DAY - Rs. 600 PER TRIP ( 600 X 4 = 2400)

AVERAGE EARNING PER MONTH - 2400 X 25 = 60000

AVERAGE RUN PER DAY - 200 KM PER DAY

AVERAGE RUN PER MONTH - 200 X 25 = 5000 KM

AVERAGE RUN PER LITRE - 18 KM / LIT. TOTAL278 KM / LIT. PER MONTH

TOTAL FUEL CONSUMTION - Rs. 40 PER LIT. X 278 LIT. = 11120

PER MONTH [ @DIESEL LIT. OIL + MOBIL ] Rs. 11120 + Rs. 800 = Rs. 11920

1) AMT. OF MONTHLY FUEL CONSUMPTION - 119202) TAX + INSURANCE - 10003) DEPRECIATION - 60004) INTEREST - 18005) SALARY OF DRIVER - 55006) REPAIR & REPLACEMENT - 2000

7) LIVING EXP. - 5000

___________

TOTAL EXP. - 33,220

NET PROFIT = TOTAL EARNTOTAL EXPENSE

= 6000033220 = Rs.26,780

Rural Marketing

Introduction

Rural Markets are defined as those segments of overall market of any economy, which are

distinct from the other types of markets like stock market, commodity markets or

Labor economics. Rural Markets constitute an important segment of overall economy, for


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example, in the USA, out of about 3000 counties, around 2000 counties are rural, that is, non-

urbanized, with population of 55 million. Typically, a rural market will represent a community in

a rural area with a population of 2500 to 30000. Marketing today has changed the dynamics of

the business. As the consumers are getting informative, the business is becoming competitive

day-by-day. Marketers are seeking fresher challenges everyday and are looking to increase theirrealm. The urban consumer has been coddled till now but this market is shrinking, prompting the

marketer to now explore the rural consumers, which promises a huge potential. The market has

enough scale to offer and enough desire to consume. The consumer in the Indian hinterland is

ready and waiting to be served.

What Constitutes the Rural Market?

The census of India defines rural as any habitation where the population density is less than400per sq. km, and where at least 75 per cent of the male working population is engaged in

agriculture, and where there isn't any municipality or board. Having said that, there are about

600,000-odd villages in India. Leaving aside Hindustan Lever and ITC, most FMCG Sector

would define rural as any place with a population below 20,000. Similarly, durable and agri -

input companies consider any town with a population below rural, primarily because the

adjoining villagers come to shop there for say a television set.

The Rural Market Potential.

The rural market has been growing steadily over the past few years and is now even bigger than

the urban market. At present 53 per cent of all FMCGs and 59 per cent of all consumer durables

are being sold in rural India. The biggest FMCG Company in India HLL derives more than

halfof its Rs. 12,000 crore revenues from the rural markets. Though there is a high component of

sales in some particular product categories like radios, watches, cassette players, the penetration


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levels are abysmally low, and therefore, offer tremendous potential for growth. The rural market

is an enigma for the companies. Due to the lack of deeper insights into the psyche of the rural

consumers, companies are hesitant to explore this territory. But local brands, like "Ghadi"

detergent in Kanpur, have been able to successfully tap the opportunities presented by this

market. A look at some facts, which will clear the doubts of skeptics about the potential of ruralmarkets in India:-

About 285 million reside in urban India as compared to 742 million in rural India.

The number of middle income and high-income household in rural India is expectedtogrow from 80 million to 111 million by 2010 while urban India is expected to growfrom 46 million to 59 million.

53 per cent of all FMCGs and 59 per cent of all consumer durables are sold in rural India.

Number of poor household is expected to shrink by half to 28 million in 2009-10 from 61

million in 1997-98, taking rural people from poverty to prosperity.

Rural marketing involves addressing around 700 million potential consumers, over 40percent of the Indian middle-class, and about half the country's disposable income.

The Indian rural market is almost twice as large as the entire market of USA or Russia.

The rural market for FMCG is Rs. 65,000 crore, for durables Rs. 5,000 crore, for tractorsand agri-inputs Rs. 45,000 crore and two- and four-wheelers, Rs. 8,000 crore. In total, awhopping Rs. 1,23,000 crore.

Thus, looking at the opportunities, which rural markets offer to the marketers. it can be said that

the future is very promising for those who can understand the dynamics of rural markets and

exploit them to their best advantage.

Opportunities

Infrastructure is improving rapidly -


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In 62 years only, 40% villages have been connected by road, in next 10 yearsanother 30% would be connected.

More than 90% villages are electrified, though only 44% rural homes have electricconnections.

Rural telephone density has gone up by 300% in the last 10 years; every 1000+ pop isconnected by STD.

Social indicators have improved a lot between 1981 and 2001 -

Number of "pucca" houses doubled from 22% to 41% and "kuccha" houses halved (41%to 23%).

Percentage of BPL families declined from 46% to 27%.

Rural literacy level improved from 36% to 59%. Proliferation of large format Rural Retail Stores, which have been successful also -

DSCL Haryali Stores

M & M Shubh Labh Stores

TATA / Rallis Kisan Kendras

Escorts Rural Stores

Warnabazaar, Maharashtra (Annual Sale Rs. 40 crore)

SCOPE OF RURAL MARKETING

The Census of India defines rural as any habitation:

With a population density of less than 400per sq.km.

Where at least 75% of the male working population is engaged in agriculture.


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Where there exist no municipality or board.

If we go by statistics, roughly around 70% of the Indian population lives in the rural areas. Thats

almost 12% of the world population.To expand the market by tapping the countryside, more and more MNCs are

foraying into India's rural markets. Among those that have made some headway are Hindustan

Lever, Coca-Cola, LG Electronics, Britannia, Standard Life, Philips, Colgate Palmolive and the foreign-invested

telecom companies.

RURAL MARKETING

CHALLENGES IN RURAL MARKETING

There are several roadblocks that make it difficult to progress in the rural market. Marketers

encounter a number of problems like dealing with physical distribution, logistics, proper and

effective deployment of sales force and effective marketing communication when they

enter rural markets. The major problems are listed below.


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1. Standard of living: The number of people below the poverty line is more in rural markets.

Thus the market is also underdeveloped and marketing strategies have to be different from those

used in urban marketing.

2. Low Literacy Levels: The low literacy levels in rural areas leads to a problem of communication. Print

media has less utility compared to the other media of communication.

3. Low per capita income : Agriculture is the main source of income and hence spending

capacity depends upon the agriculture produce. Demand may not be stable or regular.

4. Transportation : Transportation is one of the biggest challenges in rural markets. As far as

road transportation is concerned, about 50% of Indian villages are connected by roads. However,

the rest of the rural markets do not even have a proper road linkage which makes physical

distribution a tough task. Many villages are located in hilly terrains that make it difficult toconnect them through roads. Most marketers use tractors or bullock carts in rural areas to

distribute their products.

5. Warehousing : is another major problem in rural areas, as there is hardly any organized agency

to look after the storage issue. The services rendered by central warehousing corporation and

state warehousing corporations are limited only to urban and suburban areas.

6.Lack of communication system : Quick communication is the need of the hour for smooth conduct

of business, but it continues to be a far cry in rural areas due to lack of communication facilities

like telegraph and telecommunication systems etc. The literacy rate in the rural areas is rather

low and consumers behavior in these areas is traditional, which may be a problem foreffective

communication. The number of languages and dialects vary from state to state region to region

This type of distribution of population warrants appropriate strategies to decide the extent of

coverage of rural market.

7. Spurious brands : Cost is an important factor that determines purchasing decision in rural

areas. A lot of spurious brands or look-alikes are available, providing a low cost option to the

rural customer. Many a time the rural customer may not be aware of the difference due to

illiteracy.

8. Availability: The first challenge in rural marketing is to ensure availability of the product

orservice. India's 7, 00,000 villages are spread over 3.2 million sq km; 700 million Indians may

live in rural areas, finding them is not easy. They are highly dispersed. India's largest MNC,

Hindustan Lever, a subsidiary of Unilever, has built a strong distribution system which helps its

brands reach the interiors of the rural market. To service remote village, stockists use auto


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rickshaws, bullockcarts and even boats in the backwaters of Kerala. Coca-Cola, which considers

rural India as a future growth driver, has evolved a hub and spoke distribution model to reach the

villages. To ensure full loads, the company depot supplies, twice a week, large distributors which

who act as hubs. These distributors appoint and supply, once a week, smaller distributors in

adjoining areas. LG Electronics has set up 45 area offices and 59 rural/remote area offices tocater to these potential markets.

9.Affordability : The second major challenge is to ensure affordability of the product or service.

With low disposable incomes, products need to be affordable to the rural consumer, most of who

are on daily wages. A solution to this has been introduction of unit packs by some companies.

This ensures greater affordability. Most of the shampoos are available in smaller packs. Fair and

lovely was launched in a smaller pack. Colgate toothpaste launched its smaller packs to cater to

the traveling segment and the rural consumers. Godrej recently introduced three brands of

Cinthol, Fair Glow and Godrej in 50- gm packs. Hindustan Lever has launched a variant of its

largest selling soap brand, Lifebuoy. Coca-Cola has addressed the affordability issue byintroducing the smaller bottle priced at Rs 5. Theinitiative has paid off: Eighty per cent of new

drinkers now come from the rural markets. Aseries of advertisement for this was rune showing

people from diverse backgrounds featuringAamir Khan.

10.Acceptability: The next challenge is to gain acceptability for the product or service.

Therefore, there is a need to offer products that suit the rural market. LG Electronics have reaped

rich dividends by doing so. In 1998, it developed a customized TV for the rural market named

Sampoorna. It was a runway hit selling 100,000 sets in the very first year. Coca -Cola provided

low-cost ice boxes in the rural areas due to the lack of electricity and refrigerators. It

alsoprovided a tin box for new outlets and thermocol box for seasonal outlets. The insurancecompanies that have tailor-made products for the rural market have also performed well. HDFC

Standard LIFE topped private insurers by selling policies worth Rs 3.5 crore in total premia. The

company tied up with non-governmental organizations and offered reasonably-priced policies in

the nature of group insurance covers. The initiatives of CCI in distribution and pricing were

supported by extensive marketing in themass media as well as through outdoor advertising. The

company put up hoardings in villages and painted the name Coca Cola on the compounds of the

residences in the villages. Further, CCI also participated in the weekly mandies by setting up

temporary retail outlets, and also took part in the annual haats and fairs - major sources of

business activity and entertainment in rural India. CCI also launched television commercials

(TVCs) targeted at rural consumers. In order to reach more rural consumers, CCI increased its

ad-spend on Doordarshan The company ensured that all its rural marketing initiatives were well-

supported by TVCs. When CCI launched Chota Coke in 2002 priced at Rs. 5, it bought out a

commercial featuring Bollywood actor Aamir Khan to communicate the message of the price cut

and the launch of 200ml bottles to the rural consumers.

11. Awareness : A large part of rural India is inaccessible to conventional advertising media. Only


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41 per cent rural households have access to TV. Building awareness is another challenge in rural

marketing. A common factor between the rural and the urban consumer is the interest formovies

and music. Family is the key unit of identity for both the urban and rural consumer. However, the

rural consumer expressions differ from his urban counterpart. For a rural consumer, outing is

confined to local fairs and festivals and TV viewing is confined to the state -owned Doordarshan.Consumption of branded products is treated as a special treat or indulgence. Hindustan Lever has

its own company-organized media. These are promotional events organized by stockists. Godrej

Consumer Products, which is trying to push its soap brands into the interiorareas, uses radio to

reach the local people in their language. Coca-Cola uses a combination ofTV, cinema and radio

to reach the rural households. It has also used banners, posters and tapped all the local forms of

entertainment. Since price is a key issue in the rural areas, Coca-Cola advertising stressed its

`magical' price point of Rs 8 per bottle in all media. LG Electronics uses vans and road shows to

reach rural customers. The company uses local language advertising. Philips India uses wall

writing and radio advertising to drive its growth in rural areas.

SOLUTION TO PROBLEM OF RURAL MARKET

To solve the problems of rural markets in India, the following suggestions can be used by

marketers:


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1. Regarding the problems of physical distribution, the marketer may have a joint network

ofstockist/ clearing-cum-forwarding (C&F) agents at strategic location for facilitation of

physical distribution for its products in the rural market. The main advantage of this scheme is

that the costs of physical distribution can be shared by the companies and stockists. The

combination ofdifferent modes of transport based on availability of tracks will be beneficial tothe companies. Presently, bullock-cart plays a very vital role in rural distribution where the roads

are not available. Some of the leading companies use delivery vans in rural areas for resolving

the distribution problems in rural market. The delivery van takes the products to the retail shops

in every corner of the rural market and it enables the company to establish direct sales contact

with majority of the rural consumers which helps in sales promotion.

2. The rural market is composed of a number of retail sales outlets along with fair price shops

under the public distribution system. It is suggested that the government should

encourageprivate shopkeepers and cooperative stores to come forward and establish their

business in rural areas instead of the weekly market known as weekly bazaar. Fertilizer

companies have opened their outlets for proper distribution of fertilizer among the farmers.

Similarly, the companies dealing in consumer goods can apply this model. The company may

also appoint a number ofretailers in and around the feeder towns and attach them to the stockist

who distributes the goodsto the retailers as per the potential of the market. This system has the

benefit of penetrating intothe interior areas of the rural markets.

3. To solve the problems of sales force management, it is suggested that the company takes duecare in the recruitment and selection of sales people because the traits they require are different

from urban and suburban sales persons. For the rural markets, only those sales people should

be preferred for selection who is willing to work in rural areas. They must be aware of the local

language and must have the patience to deal with rural customers and can discharge the duties

of a bare-footed salesman. Administration of such a large and scattered sales force, supervising

and supporting them in sales calls, guiding them, attending to their official and personal

problems, and motivating them for better results should be an exacting task for the sales

manager. Thus, the people operating in rural areas should invariably be from the rural

background and should have a missionary zeal to serve the rural masses.

4. With reference to marketing communication in rural areas, the company should use organized

media-mix like TV, Radio, cinema and POP (point of purchase) advertising. Television is

gaining popularity in the rural areas but due to poor supply of electricity, radio is performing

significantly better. Since, the rural people need demonstration, short-feature films with


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disguised advertisement messages, direct advertisement films and documentaries that combine

knowledge and advertisements will perform better rural marketing communication. Here the

companies may also use audiovisual publicity vans, which may sell the products with promotion

campaign. To attract the rural consumers, companies can organize village fairs, dance and drama

shows, group meetings to convince the rural consumers about the products and services. In mostIndian villages, there are some opinion leaders. For the rural markets, only those sales people

should be preferred for selection who is willing to work in rural areas like Sarpanch, Pradhan and

other elderly persons. They can be approached by the marketers to propagate their messages;

these persons can prove to be effective communicators within the rural mass

RURAL PENETRATION

The size of rural markets, demographic profile of the rural market and market volume help us to


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draw a broad mental picture of the rural markets. The number of villages, population and the

number of households indicates the market size. The demographic profile of the rural market is

described in terms of household size, sex distribution, literacy levels, occupation and income.

The major challenges faced by TATA MOTORS in rural areas relate to the difficulties inreaching the geographically spread out market. In addition to this, the market density is low and

therefore the cost of reaching the market increases substantially. So for penetrating into the rural

market TATA MOTORS has come up with two rural penetration strategies:

1. PMGSY ( Pradhan Mantri Gram Sadak Yojna )

2. NGO ( Non Governmental Organization )

PMGSY


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Rural Road Connectivity is not only a key component of Rural Development in India, it is also

recognised as an effective Poverty reduction Programme. Notwithstanding the efforts made, over

the years, at the State and Central levels, through different Programmes, about 40% of the

Habitations in the country are still connected by all weather roads. It is well known that even

where connectivity has been provided, the roads constructed are of such quality that they cannotbe categorised as All-weather roads. Government have resolved to provide Rural RoadConnectivity to all habitations and accordingly decided that 50% of the Cess on High Speed

Diesel (HSD) would be earmarked for this Programme. Accordingly, Rs. 2500 crore (being 50%

of the Cess on High Speed Diesel (HSD) has been earmarked for the purpose during the year

2000- 2001.

(Depicting submersible bridge constructed under PMGSY to provide connectivity)

On the 15th August 2000, the Prime Minister announce a Centrally Sponsored Scheme

called the Pradhan Mantri Gram Sadak Yojana with the objective of connecting, within next

three years, every village that has a population of more than 1000 through good All-weather

roads and every village of more than 500 persons similarly connected by the year 2007. The

budget for the year 2009-2010 indicates the flow of funds for Rural Roads as Additional Central

Assistance. Since this has been taken into consideration while determining the Plan size of

States, it is proposed to retain the arrangement as such for this year. From the year 2001-2002

onwards, it is proposed to commence a 100% Centrally Sponsored Scheme, with the same

objectives. In the state of Jharkhand, PMGSY has been taken up where land is available. Though

along few corridors, need for private land has been identified upto 2-3 meters, locations where

(1)curve improvements, (2) passing places, (3) design improvements for safety, and (4) any


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suggestion by the community. The land requirements are accomplished through voluntary land

donation in case of private land transfer and inter-departmental transfers for government land.

With the scheme of PMGSY, TATA MOTORS has spotted a big opportunity to penetrate

into the rural market. The newly built roads under the PMGSY scheme , provide connectivity to

the large number of villages with each other and has increased the demand of public carrier

vehicles within these areas.

NGO


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(Non Governmental Organization)

A non-governmental organization (NGO) is a legally constituted organization created by

natural or legal persons that operates independently from any government. The term is usually

used by governments to refer to entities that have no government status. In the cases in whichNGOs are funded totally or partially by governments, the NGO maintains its non-governmental

status by excluding government representatives from membership in the organization. The term

is usually applied only to organizations that pursue some wider social aim that has political

aspects, but that are not overtly political organizations such as political parties. Unlike the term

"intergovernmental organization", the term "non-governmental organization" has no generally

agreed legal definition. In many jurisdictions, these types of organization are called "civil society

organizations" or referred to by other names.

Tata Motors has came up with the strategy of penetrating into the rural market through the

NGOs. The company works with the NHRM (National Health and Rural Management) and

other NGOs along with the Block Development Officers to sell the SCPV (Small Commercial

Pessanger Vehicle) through its workers. The company is mainly focusing on the sell of TATA

Magic in the rural areas.

Working of NGOs in Jharkhand

NHRM is an active NGO running in Jharkhand. It constitutes of Village Health Committees

(VHCs) which are formed with ANMs and Sahiyyas. These sahiyyas and ANMs help in

providing health care facilities to the people in rural areas. Every center or block has a blockofficer who looks after the working and funding of NGOs. Every block has a day fixed for their

weekly meetings with the ANMs and Sahiyyas. Block Development officers distribute funds to

different Mahila Samiti Societies and Village level Societies for development on

recommendation of S.H.G (Self Help Group) and V.L.W ( Village level Workers). Initially Rs.

25,000 loans is given to these groups and if the repayment is done within the stipulated time then

simultaneously the funding is increased upto Rs 5 lacs. Based on demand and mutual consent of

group , samities invest in purchasing Vehicles , Tractors , Tube wells etc which are of daily uses.

Bank gives a subsidy of Rs 1.25 lacs on such loans for the purchasing of vehicles, tractors, etc

Working plan of TATA MOTORS
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Train NGOs workers to meet such S.H.G /Samities and influence for Magic & Winger

Sale to different societies.

If any of the workers bring an enquiry and the documents of the customer in the rural

areas, we will give incentive of Rs 300 immediately, and if the enquiry gets retailed, we

give an additional Rs 700 per vehicle.

Coordination strategy

Appoint a person who is well versed with the rural marketing, who would look after the

working with the NGO.

Check if the enquiries are already available with the executives of mithila motors. If

not,the incentives would be passed down.

Act a link between NGO and mithila motors and subsequently with TSM.

Future Plans

Meetings fixed with different block officers.

Works with different NGOs like

Yuva Group.

Amma Research

Manav Sudhar

TRDS which is a NGO of the TATA Group itself.

With the success of these strategies in and around jamshedpur,the work will be done in

dhanbad and bokaro.

RESEARCH METHODOLOGY

DATA COLLECTION METHOD


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For doing any research work, a well planned out research design is devised so as to facilitate the

research work. It owes both time and resources.

Types of data and data collection:

Data that I have received for making the project is a combination of both primary

and secondary data

SUBJECT OF THE RESEARCH

The study undertaken for the study is an empirical study of Survey of demand of SCV passenger of

TATA MOTORS in rural market..

DATA ANALYSIS

GRAPHS AND CHARTS

Frequency Table

is the respondent owner or driver

Frequency Percent

Valid

Percent

Cumulative

Percent

Valid owner 31 62.0 62.0 62.0

driver 19 38.0 38.0 100.0

Total 50 100.0 100.0

Result- hence we can say that among the sample size of 50, 62% of the

respondents were owner of the vehicle and 38 % were driver. Hence we can say

that most of the people prefer to drive their vehicle by their own rather than givingit on daily-rent basis.

BAR CHART


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age of the respondent

Frequency Percent Valid Percent

Cumulative

Percent

Valid 18-25 8 16.0 16.0 16.0

26-33 12 24.0 24.0 40.0

34-41 25 50.0 50.0 90.0

42-49 4 8.0 8.0 98.0

50-57 1 2.0 2.0 100.0

Total 50 100.0 100.0


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Frequency Percent Valid Percent Cumulative Percent

Valid bajaj2 4.0 4.0 4.0

mahindra gio 2 4.0 4.0 8.0

piaggio 20 40.0 40.0 48.0

tata magic 26 52.0 52.0 100.0

Total 50 100.0 100.0

Vehicle models


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for how long the vehicle is being used


Cumulative

Percent

Valid 0-1 13 26.0 26.0 26.0

1-2 13 26.0 26.0 52.0

2-3 13 26.0 26.0 78.0

3-4 9 18.0 18.0 96.0

more than 4 years 2 4.0 4.0 100.0

Total 50 100.0 100.0


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distance travel per day


Cumulative

Percent

Valid 0-50 31 62.0 62.0 62.0

50-100 15 30.0 30.0 92.0

100-150 2 4.0 4.0 96.0

150-200 1 2.0 2.0 98.0

more than 200 1 2.0 2.0 100.0

Total 50 100.0 100.0


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trips per day


Cumulative

Percent

Valid 1 10 20.0 20.0 20.0

3 12 24.0 24.0 44.0

4 6 12.0 12.0 56.0

more than 4 22 44.0 44.0 100.0

Total 50 100.0 100.0


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fuel consumption rate


Cumulative

Percent

Valid 10-15 11 22.0 22.0 22.0

15-20 21 42.0 42.0 64.0

20-25 3 6.0 6.0 70.0

25-30 15 30.0 30.0 100.0

Total 50 100.0 100.0


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mode of payment


Cumulative

Percent

Valid yes 24 48.0 48.0 48.0

no 26 52.0 52.0 100.0

Total 50 100.0 100.0


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daily income


Cumulative

Percent

Valid below 300 28 56.0 56.0 56.0

300-500 22 44.0 44.0 100.0

Total 50 100.0 100.0


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seating capacity of the vehicle

Frequency Percent Valid Percent Cumulative Percent

Valid 5 2 4.0 4.0 4.0

6 1 2.0 2.0 6.0

7 8 16.0 16.0 22.0

8 12 24.0 24.0 46.0

more than 8 26 52.0 52.0 98.0

6 1 2.0 2.0 100.0

Total 50 100.0 100.0


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type of stering


Cumulative

Percent

Valid handle 20 40.0 40.0 40.0

wheel 30 60.0 60.0 100.0

Total 50 100.0 100.0


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aware about tata's vehicle


Cumulative

Percent

Valid yes 41 82.0 82.0 82.0

no 9 18.0 18.0 100.0

Total 50 100.0 100.0


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STATISTICAL TOOL AND TECHNIQUES:

(1)

ANOVA

design of tata's vehicle is better than that of competitor

Sum of Squares df Mean Square F Sig.

Between Groups .705 4 .176 .943 .448

Within Groups 8.415 45 .187

Total 9.120 49

Dependent var: design

Independent var: how long you are using a vehicle?

(2)

ANOVA

the seating capacity of the vehicle currently used by the customer



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Between Groups 21.743 4 5.436 5.678 .001


Total 64.820 49

Dependent var : Seating capacity


(3)

ANOVA

the fuel Efficiency of the vehicle currently used by customer


Between Groups 6.652 4 1.663 .692 .601

Within Groups 108.068 45 2.402

Total 114.720 49

Dependent: fuel efficiency


(4)


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ANOVA

speed of tata's vehicle is better than that of competitors


Between Groups 2.223 4 .556 .600 .665


Total 43.920 49

Dependent var : speed


(5)

ANOVA

comfort in tata's vehicle is more than that of competitors


Between Groups 1.027 4 .257 .859 .496


Total 14.480 49

Dependent : comfort



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ANALYSIS

1.


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CONCLUSION

There is no doubt that the rural India offers tremendous opportunity for any company to tap.

However, companies face many challenges in tackling the rural markets. Some of the important

factors being an understanding of the rural customers' needs, a reliable distribution channel, and

an effective marketing communication strategy to put their message across to the rural consumer.

This calls for a paradigm shift in the thinking of the top management of the companies, which

have been reluctant to realize the potential of rural markets. The mantra for success can befurther augmented by the Four A Framework (Affordability, Acceptability, Accessability &

Awareness). These factors will go a long way in providing the company with market value

coverage along with a steady source of revenues. The companies which are going to keep in

mind the above stated factors are sure to emerge as winners in the rural markets. Thus, looking at

the challenges and the opportunities, which rural markets offer to the marketers, it can be said

that the future is very promising for those who can understand the dynamics of rural markets

and exploit them to their best advantage. A radical change in attitudes of marketers towards the

vibrant and burgeoning rural markets is called for, so they can successfully impress on the 230

million rural consumers spread over approximately six hundred thousand villages in rural India.


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REFERENCES

Books :1.2. Research Methodology by C. Kothari

MAGAZINES & News-papers & Pamphlets:

1.Business Standards.2. The Economic Times.3.Business world.4.Company pamphlets.

WEB SITES:magic-tatamotors.com.www.siam.com

carblogindia.com.autosmaxabout.com.auto.indiamart.com.

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