VALUE BASED PRODUCT INNOVATION

TATA Nano
INNOVATION AND ENTREPRENEURSHIP GROUP - 1
Objectives
of
Discussion
Value Based According to Wikipedia when
individual, organizational, societal or
Innovation global values are used as a basis of
innovation it is called value-based
innovation.

Company introduces new tech or

modifies the existing technology
with an aim to raise the buyer’s
value by saving on cost

EXAMPLE
Nintendo Wii

TATA NANO CASE

Case
Briefing
DEVELOPMENT
PHASE STARTED

1945

FOUNDED AS A MANUFACTURER OF
LOCOMOTIVES BUT SOON MOVED
TO AUTOMOTIVE INDUSTRY

RATAN TATA FIRST

1998 ANNOUNCING PRESENTED
TATA NANO AT NEW
TATA INDICA WAS LAUNCHED FOR THE DELHI AUTO
“SCOOTER EXPO
FAMILIES”.
THREE PHASED
TATA NANO'S
JOURNEY
PHASE I

PHASE II

PHASE
Development
Phase
(People's
Car)
 MARKETING & COMMUNICATION

Hype created after

Ratan Tata’s
announcement

Non- conventional
Communication Media:
Blogging & Text
Messaging

REVENUE MODEL Online Marketing:

Facebook
FORMING THE TEAM REDESIGNING THE BUSINESS
PROCESS – THE FRUGAL WAY
Small Team of Young
Engineers

Regular meet-ups with

Chairman

Lowering down of comfort

factors (power steering,
second rear view mirror)
Removal of safety features
(airbags, anti-lock braking
system)
DEVELOPMENT PHASE
CONTROVERSY
 Market Entry
Basking in the glory of its pre-launch
hype, Tata Nano couldn’t live up to the
expectation with which it was started

FLAWS LIED IN
Offered Value Proposition Customer
Segment & Distribution Channel
Customer Touch Points
WHAT WENT WRONG ?

Broken promise of safety, concerns

raised on quality
Proposition as “People’s Car” backfired;
perceived as “Poor man’s car”
Target Group rejected the offering,
upper class adopted as 2nd/3rd car
25% hike in price.
Fear of being labelled as “Poor”
WHAT WENT WRONG ?

Failure to reach the target group :-

Rural Areas : Difficulty in buying as
outlets were in large cities
Scooter Buyer saw Nano between a 2-
wheeler and Car
Car Owners: Didn’t want to buy a
replacement for scooter.
Market Penetration
Rebuilding TATA Nano
Rebuilding TATA Nano

With initial failure, Top- Positioning

Down approach was Repositioned as a smart, trendy
discontinued; Bottom-Up and modern city car.
approach adopted

Target Audience
Young generation Model Redesign
College-going With new exterior design,
youths Women upgraded models attempted to
First time buyer do away with the stigma of
Those looking for additional “Cheap Car”
car
Rebuilding TATA Nano

Sales Facilitation

Tata Nano Financial

Scheme
New Point of Sales & What changed
Making it more
Access in rural areas now?
Small showrooms
economical: Making customer
displaying only
Nano CNG emax Nano value central to
Partnering with Big entire process
Bazaar Bottom-Up
Approach
TATA NANO:
A BOON OR A BANE

Divergent Views

TESTING NANO
ON ROAD SAFETY
Lessons from
Nano:

Effect of environmental Identify & make the views Value Proposition should
fluctuation on values and of target customers central resonate with the vision,
the subsequent to any decision right from mission & purpose of the
consequences must be the start (focus on User company & development
considered beforehand driven innovation) team
Lessons from
Nano:

High expectations from
Nano shackled Tata Motors
from adjusting its pricing,
engineering, financing and
marketing
Incorporating innovation in
Dealing with
every single business model
Changing Values component & establishing
synergy between components
and the vision & mission of
venture
T hank you

GROUP - 4
Dhananjay Shrivastava 21PGDM011
Divyansh Srivastava 21PGDM014
Hardik Kapoor 21PGDM017
Rohan Mahajan 21PGDM032
Utsav Jain 21PGDM054