Question

Topic: Strategy

Ideas For Eliminating The Need For A Car Showroom

Posted by vasudev_kamath on 3/3/2013 at 8:42 AM ET 125 Points
The Nano car is being repositioned from a low-cost to a lifestyle and environment friendly vehicle. Given that Nanos operations rely on thin margins for profitability, the company is looking for ideas on reducing its distribution costs for selling the Nano by improving their sales process and reducing the footprint or totally eliminating the need for conventional showrooms.

Can you suggest ideas in selling the Nano & on how this can be done by leveraging Network and IT solutions from a Telecommunications company which can be a game changer for the Motor company helping create a new kind of cheaper and smaller showroom for the Nano; completely eliminating the need for a showroom ?
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RESPONSES

  • Posted by Jay Hamilton-Roth on 3/3/2013 at 9:49 AM Accepted
    What's the budget for the project? What have they considered? What have they tried? What has been tested with prospective customers?
  • Posted by Gary Bloomer on 3/3/2013 at 12:02 PM Accepted
    Is this a student question?
  • Posted by Moriarty on 3/3/2013 at 12:33 PM Accepted
    What about using the car itself? You could have a salesman in the car and linked via the 3G net to the head salesroom. What do you think?
  • Posted by mgoodman on 3/3/2013 at 1:10 PM Accepted
    Given the thin margins, maybe it would be better to find a better pricing strategy. I wouldn't jump immediately to the showroom as a place to eliminate/reduce costs.

    This isn't to say that the showroom should be sacred. Only to say that if the margins are thin, there may be other ways to address the issue. Especially with the repositioning, a price increase may be in order.
  • Posted by SteveByrneMarketing on 3/3/2013 at 3:01 PM Accepted
    re: "showroom elimination" maybe it's not an either/or issue. People like to touch and feel a new car. Get inside, how do the seats fit? is the dash easy to use? etc. They don't want go out to the lot, in the sun and get into a hot car. So maybe some kind of tent of awning would suffice as a lower cost. showroom.

    However, it appears the Tata Nano's biggest repositioning problem is how the brand is currently viewed in the consumer's minds. And the existing consumer perception doesn't match the new positioning goals. Tata Motors needs to address key fundmental design and quality issues of the Nano itself to successfully reposition the brand.

    An example of the Nano media coverage:

    Is Nano The New Yugo?
    https://www.robertsalomon.com/is-nano-the-new-yugo/


  • Posted by vasudev_kamath on 3/4/2013 at 12:26 AM Author
    Thank you all for your prompt & quick responses.

    To respond to each one you here it is :-

    1) Jay -
    What's the budget for the project? What have they considered? What have they tried? What has been tested with prospective customers?
    Budget is open for consideration since it has to be implemented within the group company. Smart phone apps & bookings through ATM machine with computer car games for test drives & displays in Hyper malls

    2) Moriaty - Yes we are planning abt these options as an alternative to provide this for brand visibility by providing this to field & sales guys & for pick up & drop, however rising fuel/gas prices is a concern

    3) Steve Byrne & MONMARK GROUP - This was a customer caused issue by making alternations in the electrical wiring for making AC fittings & Stereo even before the launch of the NEW A/c version & factory fitted deck & being blown out of proportion by the media.
  • Posted by SteveByrneMarketing on 3/4/2013 at 1:55 AM Member
    Just a few thoughts ...

    1) However true it might be, Tata Motors will never win back brand loyalty by blaming the customers for "electrical wiring" problems. Perception: Tata was in a position to prevent the problem(s) in the first place. Who's Nano's PR firm?

    2) The Nano is world brand even though it isn't available in many countries. So the world perception of the Nano brand matters, and unfortunately first impressions can linger for a long time.

    3) There is always room for improvement with a sales process, showroom cost reductions, and the creative use of technology to enhance the customer's first impressions with the car. And it's always at what cost and for what return.

    I still think Nano's existing branding and it's turn around branding strategy will be at the core of all future developments and successes. People do tend to pull for the underdog.
  • Posted by Moriarty on 3/4/2013 at 6:02 AM Member
    One thought - "however rising fuel/gas prices is a concern" - surely that is one big advantage of the Nano? After all, these costs will influence the purchasing behaviour of your customers just as much as it will you. With all your electronic wizardry you can determine the character of your good leads before you send the salesman out. That way you will save a lot of fuel by not sending them to people who don't want to buy.

    Another - you can use the "disasters" of people doing their own electrical wiring by using it in the way of "if you don't start messing with it yourself". That way it ties in with the negative media message in a positive way. In doing so, you can clean up your image too. It reminds me of the advertisement used for a campaign in Norway - Ford's Sierra was described as "man and machine in perfect harmony" and the campaign ran "unless you're over 1.8m" - many Norwegians are over 1.8m. The advertisement was (I think) for Toyota! Oh, and be warned that the media always blow things out of proportion, it is a cheap way to sell newspapers.



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