BUSN20019 Research Proposal: Analyzing Tata Nano's Market Failure

This research proposal delves into the Tata Nano project, examining its operational management, marketing strategies, and the factors contributing to its market performance and eventual failure. The proposal begins with an introduction to the Tata Nano's launch and its initial goals of providing an affordable car to the middle class in India. It then highlights the background of the study, focusing on the challenges the company faced, including issues with the marketing mix, distribution problems, and the car's performance. The research aims to identify changes that could have been implemented in the operational management to ensure success, mitigate past mistakes, and avoid repeating those errors. The literature review explores existing research on the Tata Nano, discussing consumer psychology, market positioning, and low-cost innovation. The research methodology outlines the use of secondary data, including annual reports and journal articles, and the application of hypothesis testing, correlation, and regression analysis. The proposal also includes a Gantt chart outlining the project's timeline and references to relevant sources. This analysis will help the researcher to point out the chances for the car to intervene in the international market and the strategy which is required for it to enter.

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Research Proposal on Tata Nano
Name of Student
Name of University
Author’s Note

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Table of Contents
Introduction................................................................................................................................2
Background of Study..................................................................................................................3
Research Question......................................................................................................................3
Literature Review.......................................................................................................................3
Research Methodology...............................................................................................................6
Gantt Chart.................................................................................................................................6
Reference....................................................................................................................................8

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Introduction
Tata Group of Motors had launched a project of India’s smallest and cheapest car on
10th January 2008 at the 9th Expo in Delhi. Tata was providing the vehicle only at Rs. 1
Lakh without tax, which is approximately USD 2000. Tata was expecting to fulfill the needs
of the middle-class family of having the car at an affordable price. Since India’s maximum
population falls under middle-class family and every middle-class family has the dream to get
the car (Tybout, Fahey & Crowe, 2017). The Tata Nano was destined to get success as it will
fulfill the demand of the social mass. These were the primary step for the company. The
second step of Tata Motor Group was to expand and intervene in the international market,
especially countries like China, where the car has a promising future because of its unrivaled
price. The car was launched at a most affordable price, but it has no air conditioner, radio,
power steering. The car may have an unrivaled amount, but it has some severe issues
regarding the performance as the car was bursting into flames after traveling for an extended
period. On the other hand, the rival companies like Maruti launched cars which have provide
the car with cooling technology at the little bit higher price. The operational management
team was responsible for it. It was evident from the sales number that Tata Nano was a failure
which was not according to the strategy (Tybout, Fahey & Crowe, 2017). The main problem
lies with the marketing mix that was forecasted in the wrong way. The management could not
hold the promise which they made due to the rise in cost. The distribution problem was also
noticeable as the demand and supply have a big mismatch. The promotional activity was not
up to the mark, and the advertisement, which was very few to the other companies (Tybout,
Fahey & Crowe, 2017). Tata Nano was able to revert back the situation well and live up to
the name of “people’s car.” Tata Nano open the path for the second part of the project to
export the cars and do their business internationally. As per the few marketing analysts, it

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will help the car to become one of the most selling car especially in Asia due to its unrivaled
price.
Background of Study
Tata Nano is the part of the world’s one of the biggest automobile company known as
Tata Motors. Tata Motors is the leader in the automobile industry, with a revenue of 21
billion dollars just one year established its supremacy over the world in the automobile
industry. Tata Nano though after a promising future remained as the failure in the initial stage
led to a rise in the speculation and criticism. The car which was destined to become the
people’s car failed many expectations (Singh & Shalender, 2014). Tata Motors is trying to
achieve the goals which were set during the strategic period. The aim of the study is to
provide the suggestions regarding the strategy of the company (Singh & Shalender, 2014).
The study also focuses on what is the mitigation which are learned from the experience and
make sure not to repeat that mistake.
Research Question
What changes could have been done in the operational management of Tata Nano for the
success of it in the future?
What is the necessary mitigation that could be learned from the past experience from Tata
Nano program?
How can changes could be made to not repeat the same mistake that has been done in the
case of Tata Nano?
Literature Review
As mentioned by Shamim Akhtar (2014), in the case study which states the mistakes made by
Tata Nano focusing mainly on the consumer phycology. The author stated that the main

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problem lies with the wrong analysis and wrong interpretation and the wrong marketing mix.
The company failed to understand the market and also failed to impress the customers. There
was also the problem for the distribution as the company was not able to meet the demand
which resulted in the failure of the project. The company was also failed to understand the
consumer behavior and the physiology of the customer. In the case study written by Natasha
Saqib (2014) about the positioning of Nano in Indian market. In this research researcher has
stated the importance of the positioning in today’s technological improved market. The
research paper has also stated how the shortcomings and mistakes will lead to the wrong
positioning of Tata Nano, the world’s cheapest car. The research paper also discusses about
the management’s repositioning of the car as the Smart City Car. In this respect the company
have even shifted the focus on the youth for its use. In another research paper by Suhail
Ahmed and Manoj Kumar Mishra stated about the journey of Tata Nano in globalisation.
This research paper also discusses about the repositioning of the car from the world’s
cheapest car to smart city car which enhances the positioning of the car and hence the car will
be able to meet the desired growth . The research paper which is written by Arpita Agnuhotri
(2015) on the low-cost innovation in the part of the emerging markets. This research paper
has discussed four types of low-cost innovation in the emerging markets of India. The four
mentioned low-cost innovation are juggad, frugal, value and reverse innovation. The research
paper has discussed some kind of similarities and the differences exists between the low-cost
innovation. Another research paper on the sales of Tata Nano which is focused on the
targeted market for the car. In this case study researcher has discusses about the target market
for the car and also positioning of the car in the country. The study also states about the
mistakes which made by the company while positioning the brand in the market. The
problem about understanding the targeted consumer behaviour (Hansen & Nielsen, 2014).
This leads to demise of the project. The case study also suggests the strategy to improve the

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sales of the company. The case study also mentions about the changing positioning of the
company and states the benefits and disadvantages which are associated with it. As per the
Tata Nano sales figure it can be analysed that till the year 2018 Tata Nano saw a rise in sales
growth and later in next year it has drop drastically. This happened because of the lack of
improvement and thus company has not sold any unit starting from 2019. In a research paper
researcher has stated about the reason behind the end of road for world’s cheapest car. The
production of the car was stopped just after three months of its sale (Hansen & Nielsen,
2014). The car for the India’s middle class has backfired. The car was fuel efficient and was
one of the most compact cars in the world backing with its unrivalled price (Akhtar, 2014).
The car also has low emission level which lead to the car has promising future. Before the
production of the cars the company has to go under the political issues which resulted with
bad public relations (Singh & Joshi, 2017). This also led to increase in the production cost of
the company. In the year of 2018 the company had export only one unit of car. As per the
analysis goes sales for the car has started strong but after the decade it has went down
drastically and hence the car are no longer be made (Shalender & Singh, 2015). As per Tata
Motors, Tata Nano will only be made on the demand. In the last three months of 2018, Tata
Motors has seen only 3 cars which resulted in the downfall of the sales. As mentioned in the
research paper researcher, Tim Beissmann (2014), stated about the intervention of Tata Nano
in Australian market. The researcher has stated about the research about the reasons for not
entering in the Australia market (Shafiulla 2014). The car with the tag line of world’s
cheapest car are not the part of the Australian market.AS per many it is stated that there are
currently no cars in the market which can rival the Australian standards. The individuals also
stated about the safety of the car which is associated with Tata Nano are suitable for Indian
market but certainly not for Australian market (Saqib, 2014). As stated by Mokter Hossain,
Henn Simula and Minna Halme (2016) stated about the diffusion patterns of the frugal

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innovations (Hossain, Simula & Halme, 2016). The research paper discusses about the frugal
innovations and the relation with Tata Nano which resulted in the change in the automobile
market (Ahmad & Mishra, 2014). It can be concluded that all the research paper may have
discussed about the growth of the research paper but the researcher did not state anything
about the future of the research paper which will lead to the rise in the sale of the research
(Agnihotri, 2015). The strategy of the intervening in the international market are not being
formulated and stated in any of the research paper.
Research Methodology
This part of the research paper will formulate the base for the research paper as it will provide
the way the research data are to be collected and further send for analysis. There are two
types of data collection technique which includes primary research and the secondary
research. To conduct this research paper secondary research are being conducted where the
data are to collected from the existing source. In this research paper researcher are mainly
opted for the annual report of Tata Nano of 2018 for the analysis purpose. Other secondary
research data are also collected from the strata where the data of the sales are being collected.
This research paper will use the hypothesis test, correlation and regression test for the
analysis of the data and tries to answer the of the formulated research questions (Choy, 2014).
The analysis will also involve the scrutiny of the research data and posting out the mistakes
which are made by the management of the company in operations. The analysis of the
research will also help the researcher to point out the chances for the car to intervene in the
international market and the strategy which is required for it to enter.
Gantt Chart
TASK NAME STRAT DATE END DAY DURATION
Project Proposal 20/8/2019 22/9/2019 2 days

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Literature Review 25/8/2019 30/8/2019 5 days
Data Collection 31/8/2019 3/9/2019 4 days
Data Analysis 4/9/2019 4/9/2019 1 day
Project Proposal
Literature Review
Data Collection
Data Analysis
0 2 4 6 8 10 12 14

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Reference
Agnihotri, A. (2015). Low-cost innovation in emerging markets. Journal of Strategic
Marketing, 23(5), 399-411.
Ahmad, M. S., & Mishra, M. K. (2014) A JOURNEY OF TATA NANO IN
GLOBALISATION: A CASE STUDY. Dr. Ajit Dhar Dubey, 23.
Akhtar, S. (2014). Behind the Nano mistakes: A case study on consumer psychology. Srusti
Management Review, 6(1), 57-67.
Hansen, A., & Nielsen, K. B. (2014). Cars of future past in Vietnam and
India. Tvergastein, 4, 72-79.
Hossain, M., Simula, H., & Halme, M. (2016). Can frugal go global? Diffusion patterns of
frugal innovations. Technology in Society, 46, 132-139.
Saqib, N. (2014). Positioning is Inevitable–A Case Study of Tata Nano. Shrinagar:
University of Kashmir.
Shafiulla, B. (2014). Tata Nano to tata no-no. IUP Journal of Marketing Management, 13(1),
78.
Shalender, K., & Singh, N. (2015). Marketing flexibility: Significance and implications for
automobile industry. Global Journal of Flexible Systems Management, 16(3), 251-
262.
Singh, S., & Joshi, M. (2017). New Market Creation via Innovation: A Study on Tata
Nano. arXiv preprint arXiv:1708.04952.

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Singh, N., & Shalender, K. (2014). Success of Tata Nano through marketing flexibility: a
SAP–LAP matrices and linkages approach. Global Journal of Flexible Systems
Management, 15(2), 145-160.
Tybout, A. M., Fahey, N., & Crowe, S. (2017). Positioning the tata nano (a). Kellogg School
of Management Cases, 1-12.
Choy, L. T. (2014). The strengths and weaknesses of research methodology: Comparison and
complimentary between qualitative and quantitative approaches. IOSR Journal of
Humanities and Social Science, 19(4), 99-104.