Steps in Needs Based Segmentation

Steps
Needs
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Segmentati
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Segmentati
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Identificatio
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Segment
Attractiven
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Segment
Profitability

Description
Consumers for Tata Nano car has been segmented on the basis of
the important parameters considered by these customers when
selecting the car from a particular budget range. Tata Nano car is
priced between 0-3.5L and the parameters considered are (i)
Performance, in terms of reasonable power, impact of emissions on
environment and fuel efficiency, (ii) Mileage, (iii) Comfort, and (iv)
Aesthetics. In our survey of 42 subjects, 38.10%, 23.81%, 26.19%,
and 11.90% of the respondents have voted in favour of
Performance, Mileage, Comfort, and Aesthetics respectively. Thus,
it can be seen that Performance, Mileage and Comfort are the
factors weighing heavily in the minds of customers when
purchasing the car. Tata Nano Car with its small size and light
weight with BSIV technology provides the great performance in
terms of reduced environment impact, high fuel efficiency and
mileage, ease of driving even in congested places and lesser
hassles in terms of parking of the vehicle. Tata Nano provides
comfortable travelling experience for a small family of 2-4 people.
Needs Based Parameter:
(i)
Performance: Generally preferred by Males in the income
range of Rs.20000/- to Rs.100000/- per month, living in
Metro set ups, family sizes of 3-5 people and generally
commute by Public Transport or Pooled Four Wheeler.
(ii)
Mileage: Generally preferred by Males in the income
range of Rs.0 to Rs.20,000/- per month living in Towns,
family size of 2-4 people and generally commute by
Public Transport or Two wheelers.
(iii)
Comfort: Generally preferred by Females for Individual
commuting living in Metro set ups with small family size
of 2-3 people. Preferred by Males for daily commute who
now travels by Public Transport or Two wheelers.
As can be seen from above, the attractive segment for our Tata
Nano car is Males/Females with family size of 2-4 people with any
income bracket who at present generally commutes by Nonpersonal vehicles (public transport, Two wheelers and pooled four
wheelers) looking for such parameters as Performance, Mileage
and Comfort while purchasing a four wheelers in the price range of
0-2.5L.
Two wheeler segment accounts for almost 75% of the automobiles
sold in India and small car segment captures 70% of the passenger
vehicles market. Indian middle class set to reach 550 million by
2025 and have propensity for small size fuel efficient cars. No. of
small nuclear families (size of 2-4 people) increasing with
enhanced demand for small cars considering ever reducing
commuting space and increasing congestion on roads in Metro
cities and upscale towns. Thus , segment seems to be highly

Segment
Positioning

Segment
Acid Test
Marketing
Mix
Strategy

potential, sustainable and profitable. (Source: Mc Kinsey Report).

Vehicle should be positioned as Small Fuel efficient and
environment friendly car ideal for family size of 2-4 people looking
for driving comfort in metro cities and other towns. Competitive
pricing strategy is recommended keeping in mind the fact that the
Tata Nano car is catering to entry level car segment comprising of
Maruti Alto 800, Hyundai Eon, Datsun Go, Renault Kwid etc, which
are generally priced in the range of 2.5L to 3.5L.