Brand TATA going strong in the year 2008

Few days back we had started a poll on Dyutita, as to which brand was considered the BEST INDIAN BRAND. It was not much of a surprise that TATA has a great goodwill amongst the young India mesmerized by Ambanis and Murthys. Its rightly said that reputation is something that takes ages to build. The Tata Group is India's largest conglomerate company, with revenues in 2006-07 of Rs. 129,994 Crore (US $28.8 billion), the equivalent of about 3.2% of India's GDP, and a market capitalisation of US $73.6 billion as on December 13, 2007.Out of 98 operating companies in seven business sectors, 27 are publicly listed enterprises. The Tata Group has operations in more than 85 countries across six continents and its companies export products and services to 80 nations. Tata Group's aim is to improve the quality of life of the communities it serves. The Tata family of companies shares a set of five core values: integrity, understanding, excellence, unity and responsibility.

Brand TATA was surely in news through out 2007. Starting with the Fiat TATA JV, then VSNL was rechristened as TATA communications. TCS moved up three positions from 13th to be ranked as 10th biggest technology vendor in the world in 2007. TCS was also the least affected on the Indian IT giants by the rupee appreciation. Finally the TATA - Corus deal was rated as the best Asian deal in 2007 by CFO Asia. So where is brand TATA headed in 2008? To start with Tata steel and SAIL formed a JV coal mining. These are some serious signs of consolidation to come in future in the Indian steel industry. Tata Motors will be taking on M&M in the Commercial Vehicle segment with a range of new product launches in 2008.

The 20-acre Special Economic Zone being developed by the IT behemoth TCS in Gandhinagar district will start functioning in 2008 and emerge as a showcase for information technology destination in India. This facility would be 2,200-seater and work for applications development, software, Information Technology and IT-enabled Services (ITeS).

Ford Motor Co. named Tata Motors the top bidder for its Jaguar and Land Rover brands and has entered into "focused negotiations at a more detailed level," meaning Tata was named preferred bidder for the storied British automakers. Tata plans to unveil its ultracheap $2,500 [ 1 lakh ]car next week at an auto show in New Delhi. Company Chairman Ratan Tata said in a recent interview that acquiring Jaguar and Land Rover would help bring global visibility to his group — a sprawling conglomerate that makes everything from automobiles to steel and software, and a name that until recently was little-known outside India. [Humility personified]

BRAND TATA=BRAND INDIA!

BRAND TATA=BRAND INDIA!

In 1999, the salt-to-software group started the Indian invasion of global brands with the acquisition of the UK’s Tetley. Since then, it has followed it up with many big and small deals, including the $13.7 billion buy of Corus Steel. But the conglomerate is increasingly facing resistance overseas while trying to acquire brands which are higher up the luxury scale — like the opulent Orient Express chain of hotels and iconic auto brands Jaguar and Land Rover.
What ails the brand perception of the group abroad, creating an impression that it is unworthy of handling luxury brands? Trust is almost synonymous to Tata in India. Trust is created through years of knowledge. Trouble for Tata abroad could be one of ignorance.
Ranjan Kapoor, country manager, India, WPP, says the problem is not Tata- specific but country-specific. “We are an emerging economy and foreigners see us based on that.” Every country goes through an evolution; initially as an exporter of low-cost products and later to one exporting high-quality goods. India is currently going through that transition and Tata is the flag bearer of Indian business to the world. That could be why they are facing the brunt. The comments from the top management at Orient Express or Jaguar’s US dealers are brand-racist comments. In a larger context the problem is certainly one towards India. US had the same attitude to the Japanese when they first went to that country. Look where they are now, be it in auto or the electronic space. Consumers do not see brands as a brown brand, white brand, black brand.
Tata Group offers everything from luxurious and niche products to cheap and ubiquitous ones. Is that contributing to diluting the brand image? Is the good will and premium image of a Tata Consultancy Services (TCS) and the Taj Hotels undone by mass market forays? The same company can cater to two extremes. It can be mass at one end and niche at the other. Nokia, which has phones both at the mass level and at a high end, is an example. Infact Tata has been named the world’s third most accountable and transparent company by Britain’s One World Trust, ahead of names like Coca-Cola, Petrobras, HSBC Holdings, PriceWaterCooopers and Google.
Making acquisitions at the top-end should, over time, make the Tata brand substantially more valuable. Rather than spend money on creating a brand image through other activity, it (acquisitions) is a much better route.
In its bid to gain trust, it can even try highlighting its intentions through hiring people who have experience in managing historic brands to lead the pitch when they go for an Orient Express or a Land Rover. What is to be noted is that a dilution in the brand perception can happen only if the Tatas decide to dilute it.
So is there anything that the Tatas can do to change perceptions?