Tata Nano: A case study in marketing a good product badly

Anita Basalingappa

Tata Nano was India's biggest business story. Launched in 2009, the small car from Tata Motors made headlines all over the world. Here was an emerging-market brand apparently out-innovating its global rivals, creating a product that met the needs of the planet's newest consumers. At INR100,000 (around $2,000) per car, it was the embodiment of 'frugal innovation', building products to suit low pricepoints, and looked set to become a classic business-school case study.

But less than three years later, the Tata Nano continues to underperform in terms of sales, and in late 2011 underwent its second brand overhaul. In early 2012 Tata Motors indicated it would not break even on the product in this financial year. Its target at launch was to sell 20,000 units a month; its actual monthly sales have been between 2,500 and 10,000 ever since launch.