Comparative Analysis of Tata Nano and Infosys - Case Study Example

Learning to catch up The report is a comparative analysis of the two cases, Tata Nano and Infosys. One is a product and another is a companyin itself. But in both the cases the issue is similar and they are both late comers into their respective industries. In this project we will be looking into the marketing strategies of both the companies and then later on compare and contrast between the two. Further into the report we will look into the various strategies that are applicable for both the cases. Once done with the analysis, we have given some recommendations for both the cases and then concluded the topic. Tata Nano Tata Nano entered the automobile segment when the trend had changed and each and every company was focusing on delivery quality and features. It was the era of the sedans and hatchback. Tata Nano had a different marketing strategy in mind. Instead of targeting the premium segment of customers, they were planning to offer this product of the lower income group. Their idea was to come up with the “World’s cheapest car”. A person who wished to purchase a two wheeler could dream of owning a four wheeler at an affordable price with the availability of Nano. Though they came in pretty late in the competition, the product itself was unique and had a different approach. The car was small, yet spacious, with a smaller engine which would result into fuel efficiency and could easily accommodate a small family of three to four persons. The idea was to target the nuclear families in India. Tata Nano looked towards India as a blue ocean market for them. When an item is propelled in the Blue ocean market, numerous contenders duplicate that recipe and they think of their own item, so they can have a piece in the pie. Remembering the NANO, numerous organizations like Mahindra, Chevrolet and many more began speculation to take off their item in the business. Infosys Similar to the case of Tata Nano is the case of the Infosys which came in as a player in the I.T. industry much later than that of TCS or Wipro. Their entry added up to the competition. With the guidance of Mr. Narayan Murthy (CEO, Infosys) the company managed to grow and created a name for itself in the industry. It became the industry leader at one point of time. When it was time for Mr. Murthy to retire, there was serious tension in the organisation and the company started sinking after his retirement (Saran, 2011). Infosys laid lot of stress in its marketing techniques. It once more tried to re-invent the company for its own survival. This once-undisputed thought pioneer of Indian IT appears to be totally directionless. I utilize the expression directionless intentionally in light of the fact that more than its genuine execution and even future direction, it is the vibes that the organization is conveying that is especially stressing. Some of these conspicuous differences a conspicuous difference to what Infosys has remained for and championed the whole time. As a matter of first importance is responsibility. "Vulnerability proceeds in the more extensive natures turf. We exist in an extremely natures domain," said CEO S D Shibulal, in the income call with experts. That is as dubious a reason as it could be. The circumstances are no place close what it was in, say, 2008-09. A terrible budgetary environment might influence all organizations. Anyway associates TCS, HCL and Cognizant have improved far in the last few quarters. Second is its powerlessness to give edge direction. Certainly, it’s not an industry standard. Anyhow for Infosys, which has cleared up over and over that, edges, not development is its No 1 sought after destination that is an immense movement (Das, 2013). Third, and the most upsetting, is Shibulals "concession" that reception of Infosys 3.0 has been influenced by the earth. (It doesnt mind, in as late as October 12, he had guaranteed that it has genuinely begun to roll). The ensuing conclusion by media and examiners has been that executing its 3.0 methodology during a period when things are not going your direction is an enormous oversight and that has influenced both the execution of and conclusions about the organization (Chatterjee and Watson, 2005). Is Infosys 3.0 the genuine guilty party? Infosys proclaimed the plan to strive for what it called Infosys 3.0 in late 2010 and spelt out subtle elements of it in May 2011. This was the first all encompassing separation procedure articulation to originate from Infosys, in any event post-2000. It may sound astounding that the organization that has provided for us such a variety of radical administration thoughts — from HR to association society to B2B marketing — did not have a situating articulation as far market differentiation is concerned. Similarities between the two cases Tata Nano and Infosys both have been late comers in their respective industries with a difference in their timeframe of arrival. Tata Nano came into existence much later than that of Infosys. Both the companies faced tremendous competition from their rivals but in case of Tata Nano, they had a blue ocean strategy in mind. The idea of launching the ‘world’s cheapest car” had created a havoc in the automobile industry and everybody was excited to see what the Automobile giant had to offer. Tata had announced that they would be coming up with car that would be affordable for everyone who looks forward to buying a two wheeler but dreams of owning a car. The price bracket was announced of around Rs 1,00,000 ($2,000) which was by far the most competitive pricing seen in India. Infosys also had a similar idea in their mind when they entered the industry. They wanted to be the best service provider to their and would not be compromising on their quality. So they were looking forward to a premium pricing strategy. Infosys had a ‘take it or leave it attitude’ in their mind. They would not mind loosing on the market but they believed in creating a bond with their already present customers. Infosys always had had the price leadership in their mind. So it can be seen that price leadership is a common factor in both of the cases. Price leadership happens when a heading organization in a particular industry sets the price for products and administrations, then different firms in the business match the price set by this pioneer. This is regularly regular in oligopolistic markets. In an oligopolistic business, few firms exist and can manage the heading of prices. The price pioneer is normally the firm that has the biggest piece of the pie or the strongest client base because of the nature of products. Price leadership methodologies might be seen as intrigue in a few markets. A sample of the oligopolistic business model is the aerial shuttle industry. In numerous nations, few aerial transports exist; this offers ascent to a business pioneer who can command clients in the business. By setting a high price, the pioneer will direct this practice to alternate firms. This sets a standard price for products, and carriers must get high piece of the overall industry through administration or different odds and ends, as no price playing point exists. Arrangement can happen if the price leadership does not identify with an expansion in working expenses. So as we see, in both of the cases, it is an oligopolistic market and each of them is trying to be the price leaders. Tata Nano wanted to be the cheapest and the best product where as Infosys had the plan of offering the best quality of services at a premium pricing. Infosys did succeed initially as a quality service provider in the IT industry but they failed in it later on so they had to come up with a new strategy. Tata Nano failed in the initial phase but later on with the launch different variants of Nano, they succeeded in gaining the trust of the consumers. Differences between the two cases Tata Nano had a blue ocean strategy in mind. When it comes to discussing the blue ocean strategy, we need to understand the concept of Blue and Red Ocean. According to W. Chan Kim and Renée Mauborgne any industry is divided into two parts, the blue ocean and the red ocean. The competitors with the same product and ideas fall into the Red Ocean categories where extreme rivalry is persistent. This is the situation in the case of Infosys, they came into the IT industry with same ideology of offering technical support to its client. The same business was being done by TCS and Wipro from a long time before Infosys stepped in. As a result they had to face tremendous competition from them eventually. Whereas, Tata Nano as discussed above, was a different product with a different approach in the automobile segment. They did not have to face the competition. The only exception was that of the Maruti 800 which was still popular then. Another problem that came against Infosys was the premium cost factor. Infosys offered to give premium quality for a premium cost and they were not ready to negotiate on their client’s terms. Infosys has a global standardisation strategy so it believes that all the services offered by them will be global and would also mean the pricing will also be premium. Tata on the other hand has transnational strategy so it first studies the country before delivering the products or the services. This helps them to offer a suitable product for a suitable region. Recommendation In the previous section, we looked in to the similarities and the differences between the two cases. Tata Nano in spite of being unique in itself faced an initial disappointment in the automobile industry. The first reason was that they had crossed the price bracket promised by them. Infosys as a company also faced similar issues and was not accepted readily in their respective industry. Based on these issues we will be discussing some recommendations for each of the cases. Tata Nano later on realised the issues and groomed their model to offer better quality at a cheaper price. The Indian market is always keen to know the features being offered in their cars, so once we start offering features we will start selling our product in India. Nano should also have a similar approach and offer various options or variants for Tata Nano. Last year was successful for the Nano and sales rose as well with the inclusion of various models. They should think on the same path and further enhance the car. Infosys on the other hand has different situation altogether. Their idea was to offer to offer premium services at a premium price which was not accepted by the industry. Later they restructured their approach and came with a new strategy known as the Infosys 3.0. With the onset of this new strategy they came up with new services and products for their clients. This is something they should have done earlier. The application of this strategy is the way to survival for Infosys. They did a market differentiation for the first. It is always advisable to create a different market for oneself rather than jumping into the already crowded competition between the rivals. Conclusion We went through the discussion of the two different cases of Tata Nano and Infosys and we also did a comparative analysis of the two. During the analysis we tried to identify the problems between the two cases. Tata Nano had a differentiated product yet it failed to stand up to the expectation of the Indian Market. Infosys on the other hand came in later into the IT industry where it had to face stiff rivalry from its competitors. This gives us an insight that differentiated approach is very important for a product or a company’s survival into a market or an industry. The recommendation discussed above can help the company to reform and restructure their approach towards their respective markets. References Barney, M. and Narayana Murthy, N., 2010. Leadership @ Infosys. 1st ed. New Delhi: Portfolio. Chatterjee, D. and Watson, R., 2005. Infosys Technologies Limited. 1st ed. Hershey, PA: Idea Group Pub. Choubey, R., 2013. Marketing Strategies: Tata Nano: Marketing Strategies. [online] Choubeyrajj.blogspot.in. Available at: [Accessed 7 May. 2014]. Das, S., 2013. Infosys 3.0 strategy is not the problem; it could well be the solution | Latest News & Updates at Daily News & Analysis. [online] dna. Available at: [Accessed 7 May. 2014]. ETAuto.com, 2014. Tata Motors new strategies to lure youngsters towards Nano Twist. [online] Zigwheels.com. Available at: [Accessed 7 May. 2014]. Saran, R., 2011. Narayana Murthy and the legend of Infosys. 1st ed. New Delhi: Diamond Pocket Books. Solomon, M., 2003. Conquering consumer space. 1st ed. New York: AMACOM. Read More