International Marketing of Tata Motors

INTERNATIONAL MARKETING

INTRODUCTION

International marketing helps organisations in making the presence of their business across borders. It enables the organisation in satisfying the needs and desires of customer that belongs to the different culture and different nations. The term international marketing is also known as global marketing as it involves the process of planning the operations by considering worldwide factors and customizing that according to the needs and preferences of the customers of different countries (Cateora et al., 2020). This report will include the international marketing of Tata Motors for evaluating how the organisation operates their business in countries that belong to a different culture. In the report, macro-environmental analysis, and micro environmental analysis of two countries will be done in which Tata Motors operate their business. Further, the various market entry strategies opted by Tata Motors for entering into the international market will be evaluated followed by the discussion of segmentation, targeting, and positioning used by Tata Motors for differentiating themselves from their competitors will be done. At last, an analysis of the marketing mix decision of Tata Motors will be done for knowing about the approaches used by the organisation in order to attract customers that belong to different nations and cultures.

COMPANY OVERVIEW

Tata Motors Limited is an Indian multinational manufacturing company of automobiles, and it is part of the Tata group that was founded in 1945 by Jehangir Ratanji Dadabhoy Tata headquartered in Mumbai, Maharashtra, India. The company serves their operations worldwide and has a good presence internationally. Formerly Tata automotive was known as Tata Engineering and Locomotive Company. In 1991, Tata Motors made their international presence in Thailand as a joint venture with Nitol Motors for setting up NITA Company Limited (Tata, 2022). In 2004, Tata Motors made their international presence in South Korea by acquiring the truck manufacturer Daewoo Commercial Vehicles Company. In 2008, Tata Motors acquired the Jaguar Cars and Land Rover from Ford. The company has their manufacturing vehicles plant in India, the United Kingdom, Thailand, Argentina, and South Africa. That is having their huge consumer base in the countries like India, Sri Lanka, Nepal, Bangladesh, Bhutan, Italy, Poland, South Africa, UAE, Bahrain, Australia, and many more. The major competitors of Tata Motors are Maruti, Hyundai, Honda, Renault, Toyota, Ford, Mahindra, and Nissan. The competitive strategy used by Tata Motors is that they satisfy the needs of consumers by manufacturing the world's least expensive cars that are fuel-efficient and easy to handle for consumers. Tata Motors have a major product diversity range that helps them in differentiating themselves from their competitors. The major reason that Tata Motors is having good brand recognition and awareness among their consumers nationally and internationally as well, as the company holds high corporate social responsibility as they work for the betterment of society and social welfare. In 2000, Tata motors were the first brand that launches their first natural airbus following the pledge of making emission friendly car so that they can contribute to making the environment sustainable and their operations do not harm the environment as well (Daewoo, 2022).

MARKETING ENVIRONMENT OF UNITED COUNTRY AND SOUTH KOREA

MACRO ENVIRONMENTAL ANALYSIS

PESTEL	United Kingdom	South Korea
Political	The government of the UK has strong control over the automotive industry because the motor vehicles industry is dangerous and is related to the life of people and because of that government has made strict rules and regulations for governing the manufacturing of motor vehicles.	South Korea is a stable political country that has a presidential system. The country keeps a stronghold on the functions of the automotive industry related to their safety regulations so that manufacturers keep attention to safety measures while manufacturing (Daewoo, 2022).
Economic	The economy of the country also affects the business of the organisation, and the UK government is also focusing on growing the income from disposables. It means the spending on luxury items like electronics, vehicles, etc. is increasing (Pathak, 2016).	South Korea is a country that has a remarkable economy and is still developing. The economy of the country is mainly based on exports but has a strong automobile sector that is contributing to the economy.
Social	The driving popularity among the people is growing and this is the also reason why the sale of vehicles is getting increased.	The country is known for their socio-cultural activities, and it is helping the development of the automobile sector as well (Rahman et al., 2022).
Technological	Technology in motor vehicles is developing with each passing day and it is becoming important for the automobile sector for coping with that.	South Korea is one of the most advanced digital and technological countries which are known for their innovation in technology globally.
Environmental	The concern of the government is also getting increased for the environment because carbon dioxide is a major pollutant to the environment and the government is focusing on reducing that (Lee and Griffith, 2019).	South Korea is facing major problems related to the environment and for reducing that the country is adopting various measures.
Legal	The major issue faced by the automobile industry is related to copyright for the specific features in the car. It is important for the manufacturers to follow that.	As South Korea has a presidential system there are certain laws that have been made by the president which is important for every sector to follow (Daewoo, 2022).

MICROENVIRONMENTAL ANALYSIS

Customer Analysis: Tata Motors is famous among the customers of South Korea is for commercial vehicles like trucks because they deal mostly in that subsidiary in South Korea. Whereas, in the UK Tata Motors is famous among the customers of Jaguar Land Rover and satisfies the needs of customers by offering various features in that (Tata, 2022).

Competitor Analysis: In the UK, Tata Motors is facing huge competition because there are so many players exist in the market that is offering medium range cars to the customers. In the UK, Tata Motors deal with Jaguar Land Rover which is a luxury brand and cannot afford it by normal people. In South Korea, Tata Motors does not have much competition as they majorly deal in commercial vehicles Tata Motors is one of the biggest truck manufacturers in South Korea and it helps them in lowering the competition (Tatamotors, 2022).

MARKET ENTRY STRATEGIES

South Korea: Tata Motors entered the market of South Korea through acquisition. In 2004, Tata Motors acquired the truck manufacturer Daewoo Commercial Vehicles Company and became a wholly owned subsidiary of South Korea. In South Korea, it is the second-largest manufacturer of heavy commercial vehicles. The company exports their vehicles from South Korea to India, Pakistan, etc. it helped Tata Motors in expanding their business by exporting to other countries also. In the sector of commercial vehicles, Tata Motors hold a good market share in South Korea which is helping them in increasing their sales there (Shen et al., 2017).

United Kingdom: Tata Motors entered the market of the United Kingdom through acquisition. In 2008, Tata Motors acquired Jaguar Land Rover from Ford and become owned subsidiary of Jaguar Land Rover. In the UK, the company is having 05 manufacturing facilities, 03 R&D and engineering and designing centres. In FY 2020-2021, the company sold 81,500 vehicles in the UK and generated a revenue of 3731.5 million GBP. In 2021, Land Rover Defender won World Car Design of the Year as well. In the UK, Tata Motors is having a good market share and it is helping them in expanding their business (Tatamotors, 2022).

SEGMENTATION, TARGETING AND POSITIONING OF TATA MOTORS

Segmentation: Tata Motors is a company that does not focus on any single group of customers as they have their operations globally and have a diversified range of products in their product line. Tata Motor is companies that do not believe in segmenting their product for a particular group because they work on believe that the whole community should be served through their operations. Tata Motor is a brand that targets the audience from rural cities to metro locations. The company is having a range of products from NANO to Jaguar Land Rover (Schlegelmilch, 2022).

Target: Tata Motors target the audiences that have their earnings from 4 Lakh per annum and have an occupation like salaried, professionals, managers, etc. for the rural community and those who earn less than 4 Lakh for those people the company have launched the most affordable car, Tata NANO so that they can also switch to 4-wheeler from 2-wheeler. The company targets aged 21-65 years people that can belong to the middle class, upper-middle-class, high class, premium class. The company targets every type of consumer so that they can offer their product to every community and could serve their operations (Camilleri, 2018).

Positioning: In 2019, Tata Motors has got 31 ranks among 2000 on the list of Forbes’ World’s Best Regarded Companies. This is because of the huge market position acquired by the company in the world. Tata is having huge product line for every segment so that they can serve every type of consumer according to their need. For the lower-class customers, the company has positioned the Tata NANO, for middle-class Tata Indigo and India that can be used as commercial vehicle also, for upper-level Tata Motors is having Jaguar Land Rover. Tata Motors have products for every type of customer (Andaleeb, 2016).

MARKETING MIX DECISIONS OF TATA MOTORS

Product: Tata Motors is an organisation that has a diversified range of products in their product line and can satisfy the needs of every type of customer. It has been defined that a product as anything which use for offering in a market so that it can gain attention, acquisition, and used or consumed by the consumers so that it will satisfy a desire or requirement of them. Products contain things more than tangible goods. Generally defined, products contain physical objects, services, people, places, companies, thoughts or mixes of all the things. There are so many international organisations of consumer products that help in developing an international product that can include differences related to regional and cultural specifications into one product that can be established across national borders (Bhasin, 2022). The segmentation of the product gets done on the basis of an international perspective. This strategy helps the companies in taking responsibility to look over the local requirements and demands although; this alternative option is only successful in an international culture that is close to the parent country of the company’s culture.

Certainly, in some global markets, the organisation needs to modify their marketing mix as there are so many differences between the home culture and the global culture. It depends on the organisation and how customers should adopt the product. If the organisation got failed in modifying their product according to the particular need of the markets, then it can create a huge problem and can result in a tragedy for the organisation while establishing the company in the international market. Elements that are important for the company to adopt for a product for launching that according to a local market and culture are design, brand names, packaging, the logo of a brand, etc. this helps the organisation in differentiating their product from the competitors and in building the unique brand image and awareness among the consumers (De Mooij, 2015).

Consumers of the United Kingdom are different so as their culture. After the acquisition of Jaguar Land Rover, it helped Tata Motors in attracting consumers towards them so easily because Jaguar was established there from so long and was having brand awareness and recognition among the customers. The brand value and market share of Jaguar Land Rover in the UK market are so good and help Tata Motors in generating revenue by selling a good quantity of cars. Products of Jaguar Land Rover have been adopted by the consumers. The adaptation strategy of Tata Motors worked for the organisation as well (Tata, 2022).

In South Korea, the acquisition of truck manufacturer Daewoo Commercial Vehicles Company helped the company in making their presence in commercial vehicles. Tata Motors became the second-largest manufacturer of trucks and satisfied the needs and wants of the consumers. With the help of the acquisition, Tata Motors also started exporting trucks from there to different countries which helped them in expanding their business more effectively (Kraus et al., 2016). South Korea’s uncertainty level of tolerance is low in the society, and it reduces the chances of uncertainty, policies, laws, strict rules, and regulations have been adopted and implemented by Tata Motors.

Price: Price is the form of the amount that has been charged by the companies in return for products and services offered to their customers by them. The first and most important factor is the purchasers. Definitely, as of their culture and their power of purchasing, Tata Motors has found the “price acceptance” which can be tolerated by international consumers. Managers have established a price that could be depending on the revenue of foreign consumers. The second and most important factor is the situation related to competition. While entering the market of South Korea, Tata Motors looked over the price of their competitors so that they can offer the best price to their customers and establish their position in the market. The third factor that affects most on the operations of the company is the cost situation or economy of the country in which the company is going to expand their business. The last factor that influences the business of Tata Motors is exchange rates, tariffs, and regulations. Tata Motors focuses on those factors as well that helped them in establishing their market easily (Mandler et al., 2021).

In the UK, use the strategy of cost and price control because Jaguar Land Rover has been categorized into the luxury segment and cannot be afforded by everyone. Tata Motors has taken the advantage of adopting their prices as they gave the customers an opportunity of buying at lower prices and selling at a higher price. It helped them in gaining an advantage through the economic situation and purchasing power of the buyers so that they can get the opportunity of selling their affordable product range at quite a higher price in developing countries. Tata Motors has achieved profitability in every country concerning each factor that has been above mentioned. This is the main reason that Tata Motors initially decreased their prices in evolving countries and increased the prices in already established countries for offering a guarantee to their consumers and to be clear with every country’s economy and culture of a specific global market (Daewoo, 2022).

Tata Motors is a company that got the opportunity to the adoption of their products in both the countries, the UK, and South Korea. They played smart by making them adapt their vehicles by acquiring well-established companies that already have gained the market share in the market because it helped to invest low in order to attract customers towards their products. Moreover, they offered a quite varied range of products by tying up with international brands for differentiating their products from the competitors.

Place: Regarding the distribution in the field of adaptation and standardization, place and distribution are one of the important factors of the marketing mix which can be easily adaptable by the company. Furthermore, the distribution channels hold high importance in adaptation or standardization depending on the country in which the organisation is going to establish. However, Tata Motors standardized their distribution and reduced their costs so that it can increase their profitability and gain a competitive advantage in the country. Tata Motors has standardized their distribution as their concept is available in so many countries and cultures around the world. Tata Motors is having their operation in around 120 countries on six continents (Tatamotors, 2022). Tata Motors has gained around 8800 touchpoints of sales with a worldwide network. This is the biggest reason that Tata Motors does not face a huge problem while establishing their business in a new country because they are already known to customers and easily recognized. Tata Motors is an organisation that has manufacturing in almost every country in which they operated because this strategy helps them in lowering the cost of imports and helps in increasing the exporting cost because Tata Motors exports their vehicles in every major country.

In the UK, the company is having 05 manufacturing facilities, 03 R&D and engineering and designing centres. In FY 2020-2021, the company sold 81,500 vehicles in the UK and generated a revenue of 3731.5 million GBP. In 2021, Land Rover Defender won World Car Design of the Year as well. Those manufacturing plants help them in exporting their vehicles to near countries and help in reducing the cost of importing the raw material from their parent company India, this is the strategy that is helping Tata Motors in increasing their profitability and as Jaguar Land Rover is famous among premium customers, Tata Motors also gain the profitability by exporting that car in different countries as well. This distribution strategy of Tata Motors has been adopted by their customers because of their brand reputation (Mukherjee, 2016).

In South Korea, Commercial vehicles are in great demand, and this is helping Tata Motors in the adaption of their products by the consumers because they offer high-tech features in mid-range that can be afforded by small businesses as well. Tata Motors has achieved new possibilities in their activities of distribution because of the Internet. Nowadays, customers of Tata Motors can track the product with the help of the Internet and can easily get information about the product and where in the distribution chain it is (Krishnamurthy, 2016).

Promotion: The promotion of Tata Motors is based on the international strategy; the process of their promotional strategy is based on standardization and only fewer modifications are needed in some countries. Tata Motors has adopted this choice as they wanted to minimize their cost of promotion. Tata Motors has always been known for having an aggressive strategy of marketing. For endorsing their passenger vehicles internationally, Tata Motors has signed the brand Ambassador to Lionel Messi. For their commercial vehicle business, they also signed film celebrities as brand ambassadors. Tata Motors is best known as the prime sponsor of various events and this strategy has helped the company in creating awareness about their new product or establishment among the minds of the customers (Otuedon, 2016). There are so many strategies of promotions that have been adopted by Tata Motors like newspapers, promotional advertisements on broadcasting media, and now on digital media as well. As everyone knows now consumers spent most of the day on social media and want information on tap of a single click and in recent searches because of that Tata Motors have their Search Engine Optimization quite powerful so that whenever any customer search about the Tata Group they would get the related search on top. On social media, Tata Motors have tie-ups with so many social influencers which is helping them in promoting their products more effectively among the young consumer because they follow the social influencers. They provide many offers and discounts to the customers at a time of festivals with the motive of “everyone should enjoy”. Tata Motors is a company that always keeps their customers first and launches offer that can provide them happiness and increase the profitability of the company. For promoting their products, Tata Motors also analyse their markets for getting knowledge about recent trends that are going on in the market so that they can take the help from that also and promotes their products and services (Rao-Nicholson and Khan, 2017).

In the UK, Tata Motors took the help from various brand ambassadors and types of promotional activities which helped them in promoting the products. Once, Tata Motors sponsored a racing event for 600 employees of Jaguar Land Rover within the UK so that they can get a break from their daily routine and enjoy the ride. They offer the racing event and it helped them in promoting their products and attracted more customers to their products. Moreover, Tata Motors tie-ups with Louis Vuitton for their single model to attract premium customers that love Louis Vuitton (Steenkamp, 2017).

In South Korea, for the promotion of commercial vehicles the company has signed film celebrities so that the consumers can get attracted to their product and their sale could get increase.

CONCLUSION

From the above discussion, it can be said that Tata Motors is an organisation that is utilizing the techniques of international marketing for so long and have established their market presence in international markets successfully. South Korea and the United Kingdom both the countries are both different from each other and have different preferences of the customers still Tata motors have managed to operate their business successfully there. This report has included the international marketing of Tata Motors for evaluating how the organisation operates their business in countries that belong to different cultures i.e., the United Kingdom and South Korea. In the report, macro-environmental analysis, and micro environmental analysis of two countries have been done in which Tata Motors operate their business. Further, various market entry strategies opted by Tata Motors for entering into the international market have been evaluated followed by the discussion of segmentation, targeting, and positioning used by Tata Motors for differentiating themselves from their competitors has been done. Last, an analysis of the marketing mix decision of Tata Motors has been done for knowing about the approaches used by the organisation in order to attract customers that belong to different nations and cultures.

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