The Marketing Strategy Of Tata Motors

The automotive industry globally involves the processes of manufacturing as well as sales of cars and other automobiles. The business of this industry is also inclusive of retailing activities like services; sale of spare parts, gas-station retails etc. by the year 2015, and the growth rate of the industry is expected to have a rise of 5.5% (Market Line, 2012). Moreover, as per International Organization of Motor Vehicle Manufacturers, this industry is the leading driver in terms of global economic progress and the largest employer. The changing trends and rising demand for technically advanced cars are giving out more opportunities. This essay is going to be a presentation on the analysis of the Volkswagen positioning strategy with respect to the Porters models of competitive strategies. This essay would be vital, as this analysis would help in revealing the company’s competitive and strategic position in the industry.

But Firstly, we will start this part by talking about the importance of a deep analysis of the industry’s structure. A deep knowledge of the industry the company is in, is extremely important. The industry structure is unique and varies from industry to industry of course. It will determine the level of competitiveness and attraction of the industry. With the Five Forces model (Porter) and PESTEL (Political, Economic, Social, Technological, Environmental, Legal) analysis, the organization will get a better understanding of the market will allow you to know the requirements for the possible creation of sustainable competitive advantages and take the right strategic decisions. According to Porter, to create an efficient competitive strategy, it is important to understand the rules of competition that determine market attractiveness.

Porter considered understanding both the competitive strengths and the general business structure as essential for sustainable decision making and leadership process. According to porter we can observe how it can be related to MagsRus, and their significance in gaining competitive advantage.

BMW’s success lies in its strong sense of identity which is tied to the experience of driving the machine. BMW is considered as one of the leading producers of luxury & state of the art vehicles. BMW the world no.1 premium car company who owns Rolls Royce & MINI have established itself as a brand having conformance in brand image – status and driving pleasure –across the world.

Marketing is a lot like religion and most people have a strong belief that this belief is typically predicted on how they were raised rather than a formal study of religion belief. Marketing also has its share of agnostics as well as atheists – “I don’t believe Marketing exists”. Regardless of how marketing is viewed today, few questions are come up: Which can survive without the other? This is a litmus test in many situations and all believe it is fair to say that any business cannot survive without a proper marketing strategy. (Wardlaw, 2007)

In order to create individual competitive advantage each firm has to develop distinctive competencies, decide on one of the generic strategies and create superior value for its customers. The model of competitive advantage of firms was first established in 1985 by M.E. Porter in his study/book “Competitive Advantage:

There have been many different reactions towards Porter’s theory on how nations ought to compete. Some responses were validated while others rebutted his theory. Firstly, the positive response will be discussed before focusing on the criticisms of Porter’s theory. Oz (2002) implemented Porter’s Diamond model to analyse the competitive advantage of five Turkish industries and the outcome was favourable and thus validated Porter’s theory. For example, the uncompetitive Turkish automobile industry resulted in uncompetitive companies, while the presence of demanding buyers and hence intense local rivalry in Turkish construction and leather-clothing industries pushed the companies to innovate and become globally competitive. The Turkish findings by Oz thus validated Porter’s theory that indeed, competitive industries of a nation are inclined to cluster together.

The key partners of Tata Motors include the pre-owned vehicle brand from Tata Motors limited. It has formed multiple Joint Ventures over the years.

Creation, acceleration and emotion are the key components for any automobile industry to deliver its goods to the expected standards. General Motors, popularly known as GM has been a pioneer in the global autoindustry for more than 100 years. Developing from horseless carriages to the latest sports cars, innovations have always excelled at putting the world on wheels. In fact, there are a lot of exciting things to share about the company. GM’s corporation started in 1892 by R.E. Olds, with a solid financial foundation, which enabled him to produce great vehicles for customers and build a bright future for employees, partners and shareholders. GM slowly initiated its staff of experts in the factories which are located in different parts of the globe and acquired the brands like Chevrolet, Pointiac, GMC, Buick, Cadillac(General Motors Corporation, 2015). Leading the way is their tailored leadership team who set high standards for the company so that they can produce the best cars and trucks. This means that GM is committed to deliver vehicles with compelling designs, flawless quality and reliability, leading safety, fuel economy and commercial features. All are intended to create that special bond that can only happen between a driver and a vehicle. General Motors is a customer driven company and aims at earning customers

The distribution channel environment for automobiles in India is different from that of most advanced countries. These differences exist in number of dealers, size and type of dealers, functions of dealer, manufacturer-dealer relationship, car supermarkets, vertical integration, bookings, financing, number of cars sold per dealer, margins, and market environment. Because customer has wide choice, most car dealers would have to adjust to the as per the need of the customer.

In the article “The Competitive Advantage of Nations” Michael Porter describes a diamond shaped relationship of forces that define a country’s potential for being competitive in a specified industry. The four points on the diamond representing the different forces are: factor conditions; demand conditions; firm strategy, structure and rivalry; and related and supporting industries. According to Porter, the four points apply pressure to each other resulting in a national

Opportunities: The external environment plays directly to Tata Motors advantage. In India the average household earned roughly 4,000 U.S. dollars, and only 38 out of every 1,000 people owned a car. With the poor economic state of India, Tata Motors was able to produce and sell the Nano car for 2,500, giving India an affordable alternative to motorcycles and scooters. Being able to produce a low-priced car is huge for Tata Motors considering the majority of India and China’s adult population do not own a car. Producing the lowest priced car on the market is putting Tata Motors in a position to corner the market in India and China. Also a huge opportunity for Tata Motors is that there are

Above analysis shows the satisfaction level of Tata Motors customers towards the customer relationship managed by the Tata Motors. From the above it can be clearly stated that majority of the respondents are highly satisfied with the customer relationship managed by the Tata Motors.

Porter’s Diamond Model provides companies with four reliant factors that fully depend on the state of each other to achieve success within a competitive environment. However, Curran (2001) claims that Porter’s Diamond Model does not fully explain a country’s competitive advantage since only two factors provide evidence of their competitive position. The used factors are company rivalry, strategy, and factor endowments. With reference to the competitive positions of countries within major economies, factor endowments comprising of land, capital, labor, advanced technology and materials as stated in Porter’s theory, a government is responsible for contributing toward a company’s physical infrastructure (Porter 1998).

For example, Tata motors just acquired Jaguar and Land Rover from Ford Co. To gain success through these newly acquired companies they must fully understand the laws and regulations that United Kingdom practices. Tata Motors headquarters is located in Mumbai, India and is strictly controlled by the local government. The Indian government regulates operations of all dealerships. Regulations are different in every country. Tata Motors has manufacturing plants all over the world and have to be constantly watched for political change. The reason why Tata Motors is so successful in the international market is because its understanding of the countries economic situation, customer needs, and government regulations.