Branding a Commodity - The Tata Steel Way
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Case Details:
Case Code : MKTG083
Case Length : 13 Pages
Period : 1990-2003
Pub Date : 2004
Teaching Note : Available
Organization : Tata Steel
Industry : Manufacturing
Countries : India
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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.
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Excerpts
Branding Steel
The profitability of the steel industry in India is, in general, strongly linked to variations in the business cycle. Steel companies registered heavy profits when there was boom in the economy, and profits were eroded when there was a depression. In the late 1990s, the Indian steel industry was experiencing a glut, and this affected the profit margins of players...
Distribution Revamp
Tata Steel caters to two distinct customer segments - Business to Business (B2B) and Business to Customers (B2C).
The B2B segment consists of industrial customers such as Maruti, Telco, and Ford who have a technical knowledge of steel, and buy products on the basis of quality and service value.
Muthuraman said of Tata Steel's B2B segment, "Having knowledgeable customers actually helps. When I sell to Tata Engineering, Maruti, GE or Ford, I don't have to brand my product...
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Benefits Reaped
Tata Steel said that its branding initiatives started showing results right from the first year. The company reported that Tata Steel's branded products increased their market share in each product category, and sales of branded products as a percentage of total sales also registered an increase (Refer Table II)...
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Future Prospects
Looking to the future, Tata Steel has announced that the company would be focusing on co-branding initiatives with its high-end customers such as Telco, Ashok Leyland.
Company sources say that initially Tata Steel would be focusing on the automobile sector; later the co-branding initiative will be expanded to the consumer durables sector also.
Tata Steel also announced that it would focus on improving its product mix by introducing high-end products... |
Exhibits
Exhibit I: Tata Steel Product Categories
Exhibit II: Tata Steel's Modernization Program
Exhibit III: Performance Ethic Program
Exhibit IV: Tata Steel Advertisement
Exhibit V: Total Productive Maintenance Initiatives at Tata Steel
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