.NEEV

Commercial Vehicles Business Unit

Rural Marketing InitiativeA Pioneering Focused initiative by a CV OEM(Initiation : April 2010 under my leadership as Business Head ILSCVs)Today one of the important institutionalised pillars for sales volumes

Ace MagicZip IrisXenon Xenon Crew cab

Rural Income Projection

  2009-10 2015-16 2020-21

House holds 169 mn 178 mn 186 mn

Rural Income* $ 572 bn $ 1.07 trn $ 1.80 trn

*at current exchange rate, DES estimate

Rural India has 70% of India’s 1.15bn population, with exploding disposable income and consumption aspiration

1970s 1980s 1993-94 2007-2008 2015-2016

7466

58

4032

2634

42

6068

Farm Non-FarmRural Income (Farm / Non Farm %)

Source: NCAER/Rajesh Shukla

Governments commitment for Rural

Rs1.76 trillion Bharat Nirman Rural Infrastructure Program.Rs 300 bn wage payment under MNREGAAll habitation with population above 1000 will be  connected by roads under PMGSY and  MMGSY’sRs 706 bn loan wavier..

Consumption Expenditure ( Bn USD)

  1987-88 1993-94 2004-05 2009-10 2011-12

Rural 21.3 42.1 97.9 171.8 241.9

Urban 11.1 24.3 73.5 139.9 197.2

Source: NSS 66th , 69th  Round

Rural Income  growth 3 times in a decade

> 5 Lac2-5 Lac1-2 Lac50K-1Lac25 - 50K15 - 25K10 - 15K5 - 10K< 5K

2632381451026837414149

238

71

3514

102157

3S 1S

3

Tata Motors’ network presence is predominantly ‘urban’, making it difficult to effectively tap rural markets, critical for the SCV segment.

Number of outlets Vs population*

24% of TML Outlets are in Rural locations (sub 50,000 population)

* Based on 2001 census

CVBU has defined Rural as all habitations with population less than 50K, where the primary channel does not have direct or indirect reach

75% of population 25% of Population55% of Consumption 45% of Consumption

Rural Urban

Hence, we started exploring options to expand our rural reach…

 Two options for entering rural markets

Growing organically by setting up new sales outlets in rural areas – traditional way

Growing inorganically through  strategic  partnerships  with  existing  rural  players thereby  outsourcing demand capturing/generation.

…this was the genesis for Project NEEV

OR

Rural journey has been through 3 broad phases

Jul 10 - Mar ‘11 Apr’11 – May’12

Scale-up – Mah, MP, Raj, Bihar

Jun’12 Onwards

Strategy buildup and Pilots Phase

Scale-up in 3 large states (UP,AP,TN)

Why Rural? Rural Strategy for CVBU? Material and incremental?  Sustainable and Profitable

Sold 5800 vehicles Sold 23000 vehicles

17 districts in 3 states with varied socio economic conditions

RecruitReviewFeedback Train 

DRM

Neev Presence (6 States , 238 districts, 1798 tehsils, 1.5 lakh villages) (underserved habitations below 50K populations)

Neev SE

Followup leadLead feedback

Retail

500 Rural Outlets 4000 Tata Gram Mitras

Capture LeadEvaluate lead followup

1 per district

2 to 3 per district

60000 leads per month

Report to allCRM uploadCreate Opty 

TBSS

TML Dealer 

Neev Operating Model

Call Center

Graphical representation of Neev Infra architecture

Rural KSK Locations 

TGM presence

Dealer current Sales focus/ Retails

7

Neev creates an indirect presence in the geographies of passive presence, through a variable cost model

Apr2012

May2012

June2012

July2012

Aug2012

Sept2012

Oct2012

Nov2012

Dec2012

Jan2013

Feb2013

Mar2013

3 4 3 5 3 11 14 18 21 17 16 24

Neev Initiation

Active presence

Passive presence

Organisations Explored

500 Outlets

2000 TGMs 

Activities 

Tata Group companies Explored

Finance Partners

Partner Organisations

Infrastructure Presence

State Dists Total Taluks

Taluk Rural TSM   TGM Rural 

outlet NDRM NSE RBC 

AP 21 1118 515 2 422 42 17 12 7UP 68 293 209 4 545 138 63 74 17Bih 35 533 389 2 585 83 34 19 9Raj 33 241 169 3 563 72 32 27 10MP 47 316 239 3 742 79 45 31 11Mah  34 355 277 5 770 90 35 39 11Total 238 2856 1798 19 3627 504 226 202 65

TGM –  Tata Gram Mitra – Generate leads (10 to 15 TGM per dist)TKM –  Tata Kisan Mitra, Manage rural outlets . (2 to 3 TKM per district)NDRM -   Neev District Retail Manager. 1 per district, manages rural infra of the district .Neev SE –  Rural sales executive to convert leads generated by TGMRBC –  Rural Business Coordinator – 1 per dealer.

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2%

4%

10% 10% 10% 11%

19%21% 21%Key highlights

• Generate  approx 60000 leads every month.• Sold more than 35000+ vehicles till date.• Neev presence only in 63% of geographies. 

Volume Performance

States Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1AP 215 319 712 729 573 682 1147 1132 543TN 27 235 308 236 239        UP 69 372 1210 1452 1202 1597 2290 1818 1227Bih            265 1494 1448 1099Raj           140 1088 1140 741MP           256 1994 1896 1072Mah            192 1668 1434 1048Total 311 926 2230 2417 2014 3132 9681 8868 5730

Contribution 2% 4% 10% 10% 9% 11% 19% 21% 21%

2011-12 2012-13

Contribution to Sale

Proposed States for Wave - 3 expansion

Wave 1 Wave 2 Wave 3 Wave 4

Volumes 5800 23000 35000 48000TGM Nos 1000 3800 4800 6000Outlets 350 500 700 1000

This channel continues to drive volume through “Inclusive” growth with tremendous social impact at the ground level

“I  worked as a tractor agent earning 5000 in 2-3 months. After joining this prog I earn a salary and an average incentive of 5000.. This is like a dream come true for me – Anil Mishra, TKM - Satna

“I am buying this vehicle for my son who has completed his matric and is unemployed currently.” – Magic IRIS Customer, Mahakali Motors, Purnia, Bihar,

“I have a strong belief in the TATA brand. When they approached me, I was convinced. This vehicle will supplement the income from my existing business” – Magic Customer, Mahakali Motors, Purnia, Bihar,

“I am a teacher in school and used to earn Rs. 2000-3000. Neev has helped me to earn better than my regular profession and I would like to continue my work as a TGM” - Rajmal Darji , TGM, Chittaurgarh

We have given employment opportunity to more than 40000 rural folks till date

The social aspect of Rural allows multiple stakeholders to unlock significant value via Project 

NEEV

Channel partners4000 Active members

CustomersMore than 22K retails

Project NEEV has been recognized in various forums

Winners in Tata Innovista 2012 – Mumbai Region

“Innovators Trophy” in Innovision Wave 3.0 - 2012

Winners in Tata Innovista 2011 – Mumbai Region

Best Long Term Rural Communication for more than two years 

Awards on “INNOVATION”

Awards on Excellence in Rural Marketing

Best CSR by a BrandCreative Awards, - Innovative Communication Tool

Mission Mangalam – An Initiative by Government of Gujarat

The objective is to Empower the Poor by Organizing them into Self Help Groups

Formation of SHG will ensure that all the poverty eradication and social welfare

programs would reach out to the entire cross-section of people within the BPL and

marginal APL category

Empowering poor women by forming Sakhi Mandals

Gujarat Livelihood Promotion Company Limited (GLPC) was formed in April 2010 to

implement Mission Mangalam

During Vibrant Gujarat Global Investor's Summit – 2011, 32 companies and 25

institutions have signed MoUs with GLPC

GLPC Signed MOU with Tata Motors on 13th Jan 2011 regarding strengthening the

rural transportation system engaging SHGs.

Background

Thank You