29 March, 2009

The “un-nano” Effect...

That the TATA Nano would be the world’s cheapest car was always news. While I was in Germany in June 2008, critics were arguing about the safety this car would provide – No Air Bags, No ABS... well, well. I had to tell them that the top speed that we do atleast in the metro cities (during peak hour traffic) is 40km/hr and the top speed on a NH (between Blr-Chn or Pune –Mum) would be 90 km/hr. One may cross this speed at times, but would have to brake often due to cattle and their owners freely strolling on the once “village roads” – now converted into eight lane highways!

So, I would justify, that with the reliability backed by the TATAs, the space (and probably more of a M800), and pricing of two two-wheelers (for a household) and the comfort of four adults travelling together, this car is surely going to knock & rock every household across the country. Just like how its elder sibling did 10 years ago – like how auto rickshaw drivers slowly but surely migrated upwards to the Indicab!

But the larger role that I see for this “SKU” is the effect it could have on the Retail Industry – the so called Organized, the Unorganized and the Disorganized! It wouldn’t be a bad idea for Retailers to procure one car each and place it at their stores during the current economic slowdown when shoppers are shying away to even enter Retail stores, forget splurging like before. And just like the core categories, this car to be placed at the end of the store and – footfalls would grow multi fold, conversions would be higher and needless to say, shoppers would probably be buying more than now.

I don’t know how Mr. Tata and his Retail team would be thinking, but in five years from now, I see this car available for purchase at PDS Outlets, Gram Panchayat offices and even the weekend mandis across villages! I have always believed the saying that higher consumption leads to growth and what better way. Our rural consumers are probably a bigger bet than their urban counterparts. But what about roads in these villages, one may ask? With an estimated outlay of over INR 10,000 Crores planned by the NHAI in the coming years, these roads would actually be a reality soon. Deep interior villages in certain states such as Tamil Nadu, Gujarat, Madhya Pradesh, etc. are already examples of what can be foreseen.

And in larger cities, if the TATAs use their existing and future TRENT/Indicom outlets, one can imagine shoppers buying the Nano along with their Grocery/Household/ Telecom products. By the time a shopper finishes his/her shopping, the car could be serviced or water-washed and ready for takeaway! Or, if the car was already given for servicing on a Saturday or a Sunday morning, then by the time the family goes for their weekend/monthly shopping at the hypermarkets, the Car is already ready! Wow.

Now, all the above and more are not just a result of my mental diarrhoea but wishful thinking as I would believe. The phrase “power of dreams” actually belongs to another car-maker from Japan, but for India’s own family of dreamers and achievers, whose family name stands guarantee for everything that a household needs – from Sugar to Salt to Steel to DTH services to other daily use products, am sure, this “un-nano” (pardon my grammar) revolutionary effect would be visible in times to come. And who knows, I could actually be a part of it, if not merely watching it with pride and patriotism!

Thank you, HR

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