The Nano, if you recall, took its avatar to rescue the struggling section of the Indian middle class families to thundering applause from the world in general. The car is widely seen as a fine case of using a company’s PR machinery effectively for marketing a product. And it is not difficult to see reason in the argument – before spending a single rupee towards marketing the product, everyone was already talking about the car. The cacophony grew louder as the product was first unveiled in 2008 and broke to deafening levels towards its final release date. So all went well up to this point, right?

Well, I am here to argue just the exact opposite; to point out why the free publicity was not such a good idea after all.

 The Nano story

At the Geneva Motor show in 2003,Ratan Tata expressed his empathy for the middle class Indian family that plies on Bajaj Chetaks like performers from a Russian Circus. The rest, as they often say, is history. Media houses the world over ran features on the $2500 ‘Car for the Masses’. People saw this as an event that could trigger the magic Ford Model T and the Volks Wagon Beetle created in the last century.

We have to appreciate the fact that as a product, the Nano exceeded people’s expectations of a Re.1 lakh car. But, a few fire scares, a farmers’ revolt, a construction plant move across the breadth of the country and an HBR case later, the magic everyone expected from the Nano is nowhere to be seen. For a product that was predicted to swarm Indian cities in huge numbers to cause traffic jams and increase carbon footprint of the country, the customer response to the Nano has been underwhelming to say the least.

Tata Motors did take various steps it deemed necessary to make the buying process smooth for the intended target folks – the initial cash payment needed is only 15-20 thousand rupees, customers could apply to purchase a Nano at more than 30,000 locations in 1,000 cities, low EMI loans are available, bookings can be made at various points including Croma stores,the infamous fire incidents were dealt with, more variants were introduced and diesel models were on their way. The sales figures were pretty disheartening at one point, touching a low of just 500 numbers in November 2010, but have recovered since then due to the above mentioned measures. But still the numbers are way adrift of the expectations.

So, what went wrong?

This is where the Tapioca story becomes relevant. Also known as Cassava, this tuber is a staple food for about 500 million of the world population, mostly in the tropical regions. Like the Potato, Tapioca too originated in the Andes and was spread across the world by European traders.

It was the second half of the 19th century and the erstwhile kingdom of Travancore was experiencing a severe famine. The King was looking for cheaper, easy to grow alternatives for rice and found the solution to be the Tapioca tuber brought by the Portuguese. Tapioca was perfect for the population’s need and geography. Cheap to cultivate, has similar carbohydrate content as rice and can be used with the same side dishes as rice. But making the whole Kingdom adopt this new crop was a problem. Pepsico and Kellogg’s turmoil in India show how difficult it is to get into people’s food habits.

Anyways, the King had enough marketing acumen to know that even at the Bottom of the Pyramid, people look for value and that brand positioning is critical. The King couldn’t just issue an order to get it adopted by the masses saying it’s cheap and easy to cultivate and cook.

And thus born was the mother of all marketing tricks.

The legend has it that, the King cultivated the tuber on a field adjacent to the palace, with a fence around it and the army deployed to guard it. Announcements were made in true royal style around the kingdom about the Special Royal Plant imported from Portugal exclusively for the King and the royal family. The announcements also described in detail the cultivation and cooking of Tapioca, including how to recognize when the plants are ready for harvesting and replanting. And of course, there were severe penalties involved if anyone is found meddling with the exclusive crop.

So when the crop near the palace was ready for harvesting, the whole country knew exactly how delicious tapioca dish is and what to do if you get hold of some. And one of those days, for reasons known only to the King, the army was withdrawn from the crop’s guarding duty. And no marks for guessing, silly Mallus(I am a rich, intellectual, handsome, soft spoken Mallu myself, so you can’t ban my next 8 articles for this racist comment)were thus tricked into stealing the whole crop overnight.And it is the second most common staple food in the state of Kerala to this day.

Back to the Nano

Travancore’s almighty King had the sense not to say “You poor, famished folks – take this Tapioca I imported for you and cultivate for food – they are cheaper than rice and easier to grow”. In comparison, think of how the Nano came across in its communications.

“Ratan Tata announces the world’s cheapest motor car. Tata is making it for the Indian middle class family that balances on a scooter, battling the harsh Indian weather“

If I am an Indian middle class family owning a bike/scooter, will I buy a car that is available between 1-2 lakhs? Probably yes. But, will I buy a car that comes with these positioning statements? Probably not.

I am speaking about not the exact phrases from the Tatas, but rather how the message reached the public through news paper, television and other media. Once the Tata PR machinery started the campaign, the story went viral, and till the first photographs of the model came out, cheap carwas the most prominent phrase used while people spoke about the car.Tatas wanted everyone to know about the ‘affordable’, low priced car, but what stuck every one’s mind was the ‘cheap car’ tag

A stock market cartoon inspired by the Nano PR campaign:

What I believe is that the company could have tackled this problem with its initial advertising. It in fact did a good job with the print ads, talking up the technological innovation, numerous patents etc. But where it slipped up was the TVCs. The launch ad is sweet and to the point. But the follow ups, though well executed, were probably stressing the wrong points. They spoke about the comforts of a car in comparison to a scooter/bike. I would think that these hygiene factors are facts known to the public already. What the public really wanted to know was about the car’s performance and safety. And even if these were addressed, there still was the little elephant in the room – the ‘cheap car’ tag. Talking of little elephants, remember how the Tata Ace was launched – a vehicle with engine capacity similar to the Nano, it was called ‘the little elephant’ and the imagery stuck very nicely for it, giving the robust feel.

There is a perception that the Nano is way too basic – it is NOT. People still buy the costlier Marutis and Hyundais without A/C and power steering, showing that Indians don’t have a problem with using basic cars. It works because at a glance, pretty much all the models look the same and these cars are perceived to be standard classy acts in the rural areas.

The company came up with an awesome product, corrected its glitches, worked on the price barrier and distribution and started promoting it. The sales figures showed a surprising fact – the car was being bought by the urban rich as a toy or a second car for city use and the intended target of the middle class was less forthcoming with orders to buy the product.

For the first category mentioned here, the Nano is a utility car which they consider to be cute, and they do not care about the small boot space or how it is perceived due to its low prices. But, for the rural markets, the people who are buying their first car, it is a matter of pride and prestige. They would rather not buy a car than buy one their neighbor considers to be cheap

Having said that, talks of the Nano being a flop is premature. The Tatas seem to have figured out a little bit about the problems and recent press releases spoke about concentrating on higher end variants of the car and their promotion. Also we have to remember that the company has the experience of producing the Indicas for a long time suffering huge losses, till it finally turned around. The Nano is too good a product to fail and Tata has the financial muscle to carry the car until it breaks even.

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