4 PS OF MARKETING:

1. PRODUCT:
Tata Steel Products
The Companys products consist of TSL products, produced by the Companys Indian operations
and its NatSteel and Tata Steel Thailand operations, and Corus products, and produced in the
United Kingdom and The Netherlands. TSLs products can be divided into three main categories:
1. Finished and semi-finished steel products;
2. Ferro alloys products; and
3. Other products and services, including tube products, bearing products, refractory products,
pigments, municipal services and investment activities.
Corus has four main product segments: (1) strip products; (2) long products; (3) distribution and
building systems; and (4) aluminum.
TSL Products:
Finished and Semi-finished Steel Segment Products
TSLs finished steel products are produced at its Indian facilities, as well as in various Asia
Pacific countries by NatSteel and in Thailand by Tata Steel Thailand. TSLs finished steel
products can be principally divided into flat products and long products, including wires. In
addition, TSL also produces relatively smaller quantities of semi-finished steel, rings,
agricultural tools, and steel equipment.

1. PRICE:
Pricing is one of the most crucial elements behind a successful product. It is more pragmatic and
fact oriented in industrial marketing as compared to pricing for consumer products. Pricing in
industrial marketing is closely related to the firms product, distribution and communication
strategies.

Factors Influencing Pricing Strategy in Steel Industry

The most important factors which affect pricing strategies in steel industry are:
1.
2.
3.
4.

Production Costs
Market demand (derived in nature)
Competition
Government regulations

Production Costs
Tata Steel is the lowest cost manufacturer of steel and keeping production costs low have played
a major role in achieving that. The following measures have helped Tata Steel in maintaining
cost leadership:
1. Acquiring sources of raw materials in India and globally: Tata Steel has captive coal
mines in West Bokaro and Jharia. The mines in Bokaro have reserves of over 196 million
tones and the coke mine in Jharia can produce 1.9 million tones of raw coal annually. Its
iron ore mines are located in Noamundi and Joda and chromite mines at Sukinda
contribute to raw materials for Tata Steel.
Internationally, Tata Steel has 5% interest in the Carborough Downs Coal Project located
in Queensland Australia for low ash coal. The Sila Eastern Company has been established
to develop limestone mines in Thailand mainly for the captive use of Tata Steel.
2. Capacity expansion: With the expansion of its Jamshedpur plant by 2012 and Greenfield
units in Orissa and Chhattisgarh becoming operational in 3-4 years, its manufacturing
capacity will jump to 21 mtpa. Acquisition of Corus has made Tata Steel one of the
largest manufacturers of steel.
3. Technology: Tata Steel has developed several technologies that help in keeping
production costs low. Some of them are:
- Process innovation and use of blue dust in sinter plants increased productivity by
60%.
- Stamp charging technology was indigenously developed to convert low quality coal
to high quality coking coal. This reduced the import of coking coal.
All these factors and more have led to Tata Steel being the lowest cost, but still the best quality
steel manufacturer.

Pricing Strategy:
A pricing strategy must be conceived in relation to overall business objectives and marketing
strategy. The success of any business depends upon a blend of long run profit, growth and

survival objectives. Price, because of its influence on unit sales volume and profit margins,
affects long run profit objectives. And maintaining profitability through sound pricing practices
is necessary to ensure the firms survival over time.
The pricing strategy adopted by Tata Steel is the Market Penetration Strategy. This strategy is
based on the assumption that demands for the product is highly elastic. By setting relatively low

price Tata Steel has managed to obtain large market share. The advantage of this kind of pricing
is that it discourages competition since there is less opportunity to reap unusual benefits on
investment. Since Tata Steel is in control of large iron ore deposits it has increased its capacity
manifold and so enjoys economies of scale. It has thus maintained prices of its products lower
than of its competitors and has increased the scale and efficiency of operations, since it has lower
production costs.

. PLACE:
Place represents the location where a product can be purchased. But in industrial marketing place
is often referred to as the distribution channel.

Distribution channels at Tata Steel:

Tata Steel Limited delivers steel products to Indian customers through:

Direct supply channels,

21 stockyards,

25 consignment agents,

15 external processing agents and

TATA Steel main distribution channel is selling branded steel through Mjunction.It provides
cutting edge of Information Technology, is a 50:50 venture of SAIL and Tata Steel. It is India's
largest e-Commerce company and the world's largest e-Marketplace for steel. Mjunction offers a
wide range of selling, sourcing and knowledge services that empower businesses with greater
process efficiencies.
Tata Steel initiated the first online e-Sale through Mjunction in the month of February 2002 and
since then has sold 221,259 MT. The products that Tata Steel has sold through MJunction are:
HSM Defectives, HSM POR, GP Coils, LP Defectives, Prime Billets and Secondary Products.
The results have been extremely encouraging for Tata Steel, with products being sold to

customers all over the country. The prices obtained by Mjunction have been reflective of the
market situation.
The entire cycle time of selling materials has been reduced by the speed and efficiency with
which on-line competitive bidding events has been created and managed by Mjunction. Through
intensive market-making efforts and the use of technology, it is bringing in both, greater
efficiencies to processes and greater focus to the sale of non-core products of Tata Steel.

4. PROMOTION:
In B2B marketing advertising, promotions and publicity plays an important role in the
communication strategies. Hence, to contribute to the overall effectiveness of the promotional
strategies utmost care must be taken by the companies.
B2B promotion is used to create awareness of the company, to increase the sales of the product
and to increase the overall effectiveness of the selling efforts. The promotional programme
begins with carefully developed advertising objectives that must be formulated from corporate
and marketing objectives in such a manner as to set the direction for creating, co-coordinating,
and evaluating entire promotional programme.

Promotional activities undertaken by TATA Steel:

Branding Steel Based on Customer Focus
As one of Indias most successful companies, Tata Steel represents a great example of a strongly
branded B2B company. In 2001and 2005, Tata Steel was ranked the worlds best steel company
in studies carried out by World Steel Dynamics Inc., USA (WSD), a leading steel information
service provider.

Branding Steel
The profitability of the steel industry in India is generally linked to business cycles, reaping
profits when economy is going well and eroding them when it is in depression. In the late 1990s,
the Indian steel industry was experiencing a glut in the market which strongly affected the profit
margin of all related companies. To reduce its dependence on the external environment and
business cycles, Tata Steel adopted a strategy which stressed the following two points:

Branding its products

Moving to high value added products.

The company soon realized that a strong customer focus is essential if any branding approach
was to be successful. It soon began to introduce Internal Campaigns in order to bring the
customer-centric message to its employees. In the late 1990s, the company launched several
Internal Marketing Programs to emphasize customer focus and service. The programs had
taglines such as:
Customer first her haal mein (Customer comes first in any case),Customer first her haal
mein, her saal (customer comes first in every case, every year),Customer ki kasam hain
taiyaar hum (We pledge to the customer that we are ready for him).