Tata Chemicals Marketing Strategy & Marketing Mix

Marketing Strategy of Tata Chemicals analyses the brand with the marketing mix framework
which covers the 4Ps (Product, Price, Place, Promotion). There are several marketing strategies
like product innovation, pricing approach, promotion planning etc. These business strategies,
based on Tata Chemicals marketing mix, help the brand succeed.

Tata Chemicals marketing strategy helps the brand/company to position itself competitively in
the market and achieve its business goals & objectives.

Tata Chemicals Product Strategy:

The product strategy and mix in Tata Chemicals marketing strategy can be explained as follows:

Tata Chemicals is one of the leading chemical companies in India. Tata Chemicals business can
be divided into 4 segments and accordingly the products are categorized as the following:

a. Consumer products: These are used by people in day to day life. Tata salt brand comes under
this segment. Tata salt is market leader in iodized salt segment in India with more than 600
million people consuming it every day. Tata salt has two salt variant: Tata Salt lite and Tata Salt
plus. The low cost and innovative purifier ‘Tata Swatch’ also belongs to this segment. Tata
Chemicals also offers nation’s first brand of pulses called as ‘Tata Sampann’ which was
previously called as I Shakti.

b. Industry Chemicals: Tata Chemicals is second largest producer of Soda ash in the world.
Tata chemicals produces industry essentials like caustic soda, liquis chlorine, gypsum etc which
are required by diverse industries such as glass, textile, food, mining, chemical processing etc.

c. Agri Soultion: Tata Chemicals produces essential farming products such as fertilizers,
pesticides, improved seeds, special nutrient to enhance crop productivity. Tata chemicals also
runs Tata Kisan Sansar network to provide special information to farmers to improve agricultural
practices.

d. Nutritional Solution: Tata chemicals under its Sustentials brand offers nutritional solution to
modern customers. Tata chemicals flagship product ‘Gossence’ is helpful in growing good
bacteria to improve health.
All these complete an insight in the product offering in its marketing mix

Tata Chemicals Price/Pricing Strategy:

Tata Chemicals faces tough competition from HLL (Annapurna, captain cook salt), BASF,
Pidilite Ind, Aarti Ind etc.

As the numbers of competitors are more in the consumer product segment which offers
commodities such as salt, pulses, purifiers etc. therefore Tata Chemicals follows a competitive
pricing strategy for its products. The reason for this pricing strategy is because buyers
(consumers) have more bargaining power and can switch brands easily. Tata Chemicals always
focuses on providing best quality products to its customers as pricing are nearly same by all
competitors like Tata Swatch purifier is a low cost innovative water purifier solution by Tata
Chemical. Tata Chemicals also charges competitive prices for its industrial products like
chemicals and other agri products etc. Tata Chemicals also sometimes follows flexible pricing
policy and gives discount on its agri solution products like fertilizers, pesticides etc mostly sold
to small farmers with low income level. For its business division of Nutritional Solution the
company charges premium pricing strategy for its flagship brands like Gossence. This covers
how the company price’s its products in its marketing mix.

Place:

Tata Chemicals Ltd began its operation in Gujarat in the year 1939 and now it operates in 4
continents covering Asia, Europe, Africa and North America. The company has its own branded
stores in places that sells its products. Tata Chemicals run Tata kisan Sansar outlets other than its
presence in traditional retail stores and other retails chain. TCL has a strong distribution network
for its salt brand and it uses the same network to sell now I Shakti pulses across India. Also
Rallis india which is a subsidiary of Tata Chemicals which operates in farm products sector has
more than 2300 distributers and about 40 thousand retails shops across India which covers more
than 80% of Indian districts. Rallis India is benefitting more than 5 million farmers across India
through its Kisan Kutumb program.

These retail shops offer the farmers a one stop solution for all the farm essential products and
services.
Tata Chemicals Promotion & Advertising Strategy:

Tata Chemicals uses omni channel to promote its brand and products. The company is engaged
in promotional activities on TV, radio, print, social media, events and sponsorships. Tata
Chemicals has hired some famous celebrities like Sanjeev Kapoor to endorse the I Shakti pulses
brand. Tata chemicals emotional promotional campaign ‘ Tata namak: Desh ka namak’ is the
most popular campaign. Tata salt also came up with a promotional strategy of branding plates
during the Kumbh mela of 2016. Tata chemicals also run Tata Chemical Society for Rural
Development (TCSRD) program to increase productivity of crop and impart knowledge to
farmers. Tata chemicals also started a social program called ‘Desh ko Arpan’ to help under
previleged children in society. Tata chemicals also provides sponsorships to AnnualWomen
STEM conference at university of Wyoming and during Rio Olympics it launched a campaign
‘Namak ke Waastey’ for supporting Indian athletes. Hence, this concludes the entire marketing
mix of Tata Chemicals.
Tata Chemicals changing strategy to revive profitability:

In 2013, the company shut down its plant at Winnington in UK making soda ash and calcium
chloride. Also it announced the mothballing of its premium ash plant in Magadi, Kenya.
Mothballing is referred to as the process of maintaining in good condition a plant not in use so
that it may be revived in future.

The restructuring is done because the acquisition of Brunner Mond, comprising soda ash
operations in the UK and in Kenya, in 2005 unfortunately did not perform in line with
expectations due to a combination of internal and external factors and due to high energy cost
plant were shut down..

Further, to reduce finance costs, Tata Chemicals converted a loan from a consortium of five
bankers to a single loan from one lender. To bring down the cost of power generation from the
newly acquired plant, the company bought a steam turbine and also negotiated for a grant from
the UK government. It also set up a new 50,000 tonne per annum sodium bicarbonate plant.

The result of the restructuring gave the company four revenue streams in the UK—one plant of
soda ash, a sodium bi-carb plant, the energy plant, and British Salt. All this put together, by the
end of the 2016-17 will generate sufficient operating margins.

Tata Chemicals posted losses in the 2013 and 2014 quarters, due to a hit from the restructuring.
In the quarter ended 30 June though, it reported a profit of ₹ 175.5 crore, propped by other
operating income.

The firm tried to identify alternative sources of energy for six years after the plant was
established in 2006, but nothing worked. It also explored coal linkages, but in vain.

The company expects its Kenyan operations to turn around from the October-December quarter
this year; however, profits will not be seen during the year, according to Ghose.

Next Target:

The company’s strategy now is to focus increasingly towards consumer products and the
non-subsidized and deregulated fertilizer products is going to pay positive dividends going
forward.
The new avenues of growth for the company will be consumer-focused products in both its units
—food and agricultural products.

It wants to leverage the Tata brand and the image of Tata Salt. The company has already
commissioned a nutraceuticals plant in Chennai, which will start operations soon and mark its
entry into wellness and nutrition products. It already has a range of products in the pulses, lentils,
and spices category.

Second, it will focus on seeds, agro chemicals, plant and crop nutrition, and contract
manufacturing.

These initiatives, together with Tata Chemicals’ substantial cash generation potential, should
help the company revive profitability, pay down debt, and improve its return on capital in years
to come.

Apart from all the restructuring, it has also embarked on a debt reduction drive for the next five
years. In the UK, it will bring the current £120 million to £70 million while debt at Kenya will
come down to $60 million from $118 million.

In India, it plans to cut its gross debt of ₹ 3,000 crore by 50% in next five years.