On the sidelines of the launch of Tata Motors' Altroz - a quick chat with Vivek Srivatsa, head - marketing, passenger cars, Tata Motors.
Tata Motors marked its entry into the premium hatchback segment with the launch of the Altroz, which will be available at an introductory price starting from Rs 5.29 lakh for the petrol version and Rs 6.99 lakh for the diesel version. At the same launch event, Tata Motors also simultaneously launched three fully BSVI ready cars, becoming the first car manufacturer to introduce four models in a single event. At the beginning of the line-up was the Altroz, followed by the Tiago, Tigor (safest in their category) and the Nexon. This comes as surprising at a time when the auto industry in India is facing a slowdown and nearly every company in the industry has seen their sales numbers become adversely affected as a result.
Speaking at the launch, Guenter Butschek, chief executive officer and Managing Director, Tata Motors, said, “The future of efficient, green, sustainable mobility solutions needs to translate into reality and we have made a start by bringing the new generation of BSVI solutions to the market. With the Altroz, we are expanding our market coverage further. We have lots more in store for 2020...”
We caught up with Vivek Srivasta, marketing head, passenger cars, Tata Motors. Here are some edited excerpts from the conversation...
Q: Throughout the event, I noticed the continuous emphasis on safety. Can you tell us about the consumer research that went into selecting this insight to design your products?
A: Around 10 years ago, safety was hardly important to customers. It’s no wonder that we’re one of the countries with the highest road fatalities in the world. Safety was never the reason to buy a car. We took a chance with the Nexon - we got it crash tested in 2018 by the world’s leading certification agency for safety. When we announced this, we saw interest among the consumers in this product. No data or research told us to focus on safety – but we realised that inherently, the consumer has begun to value safety. Steve Jobs famously said – I don’t do market research, I just give the customer what he wants. It’s one of those things where the customer doesn’t know what he wants until he sees it – hence the response to the Nexon.
That’s why we took a leap of faith and gave the customer a product focused on safety and it’s been followed up with the Altroz, Tigo and Tiago. These are entry level cars – but we give them the safety level of a premium car. We want the customer to have a premium safety level in an entry level car.
Q: How has the consumer and his expectations from a car evolved in this digital age?
A: Digital is impacting every level of car buying. Today, the customer spends 80 per cent of his entire buying time on online research and 20 per cent in actively speaking to dealerships, taking test drives, and completing the purchase process. This means that by the time the customer comes to the dealership, he already has an idea of what he wants. He’s decided what to buy thanks to his research and for us, that’s a big change in customers and their point of view.
The big changes are happening with how he interacts with organisations. Earlier, if you wanted to take a car for a test drive or even look at it, you had to go to a dealership. Now, every part of that process is online. If you choose a car online, our dealership can make it available to you for a test drive, at your doorstep. You can even get digital quotes and doorstep delivery of the vehicle. In short, the entire vehicle can be purchased and delivered without the consumer seeing the vehicle in person, even once.
Q: What are some of the challenges you’ve faced in the digital age?
A: We’ve faced many challenges because of the rise of e-commerce companies. There is now a tremendous shift in consumer expectations from companies in terms of turnaround time – sometimes you even get delivery in the evenings and even returns are convenient. The minute you get on to a digital platform, the consumer has similar expectations. If he books a test drive, he will expect delivery in an hour or two. The customer has every right to have these expectations – so we need to step up the game in terms of responsiveness to meet our customers’ expectations. Even though the goods are different, the customer gets used to a certain level of responsiveness – the company that delivers the consumers' expectations will ultimately win.
Q: Could you tell us more about the TG you’re focusing on?
A: In the last five years, the profile of our audience has come down in terms of age, but gone up in terms of numbers. The kind of design and changes we’ve brought in reflect the theme ‘young at heart.’ That’s where the future market lies. The market grows in the ages between 20 and 30 - which is very crucial for us. The age group between 40 and 50 tends to be a stagnant one for us.
Q: How have you seen the auto sector evolve in India?
A: As far as Tata Motors is concerned, though we’ve been around for nearly 75 years, the large part of our focus has always been on commercial vehicles. People don’t realise that we’re among the youngest passenger car manufacturers in the world. A lot of engineering skills have been adapted over the years. In terms of manufacturing consumer vehicles, we’re relatively young.
Q: Have cab aggregators like Ola, Uber or rental services like Zoomcar and Revv affected the demand for personal vehicles?
A: They are stimulants to our business. If I start to learn to drive a car, I’d think about practising on a rental car and keeping my personal car safe, or if I have to go on a road trip with a lot of people, I’d opt for a rental car. Overall, the rental business category also has to buy cars. It will stimulate car buying rather than be a competitor to our business.
Ola and Uber offer convenient mobility, but there is no guarantee involved; there will always be demand for personal vehicles. They are by nature unpredictable because they are not created for a steady market. As long as that unpredictability remains, the demand for personal cars will always exist.