Tata Steel helps India’s tens of millions of homebuilders
Tata Steel helps India’s tens of millions of homebuilders
India’s largest steel producer sought to vastly expand its business online. It launched three initiatives, including one that can now reach any consumer in the country within 72 hours, and is projected to generate an incremental $500 million over the next 3-4 years.
Teaming up to move millions of tons of steel
Bain’s many teams helped the client analyze over a dozen options. Those teams combined a deep understanding of the local market, supply chain design, and ecommerce, and helped them build, test, and scale the resulting digital properties.
Teaming up to move millions of tons of steel
Bain’s many teams helped the client analyze over a dozen options. Those teams combined a deep understanding of the local market, supply chain design, and ecommerce, and helped them build, test, and scale the resulting digital properties.
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Advanced Analytics Group (AAG)
Data scientists and advanced analytics experts built the measurement backend for the several digital properties, and helped measure customer sentiment using Bain’s own NPS®.
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Bain Capability Network (BCN)
Bain’s capability network provided two local researchers to assist the case team, conduct research, and answer questions throughout the project.
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Marketing Consulting by FRWD
Bain’s modern marketing group, FRWD, partnered with other teams to build a marketing operating model that’d ensure the new digital initiatives would reach the right buyers at the right time.
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General Consulting
The consulting team set up the project in three phases, starting with ideation workshops and an exercise to help them prioritize. While other teams helped design and build the proposed digital properties, the consulting team guided with market analyses, risk assessments, and a change management strategy.
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Innovation & Design
Bain’s innovation, venture, and design studio conducted thorough customer research to identify hot button issues and the top opportunities. They workshopped those insights, circulated prototypes to seek extensive customer feedback, then built the solutions via Agile sprints.
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Product, Practice, and Knowledge (PPK)
Knowledge managers on the PPK team unearthed dozens of case studies and voluminous research on similar transformations.
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Research & Data Services (RDS)
Research and Data Services accessed a range of external data sources to provide company financials, competitor information, relevant external reports and actual datasets to help the case team look at the external environment.
Background
Tata Steel was set up in 1907 and has grown into India’s largest producer, selling 20% of all steel in the country. That legacy has given it massive reach and wide market recognition. But while India has been quickly networked together over the past few decades, the process by which most people purchased steel has remained steadfastly offline. Tata’s marketing and sales team wanted to reach India's tens of millions of citizen homebuilders and make construction easier.
The sales and marketing team set the ambition of creating an online digital business that’d grow to be worth more than its entire existing $21 billion business. They also wanted to position Tata Steel as the premium product, and give consumers peace of mind that when they purchased rebar or corrugated sheets, they could trust the quality.
For help with all this, they turned to Bain.
The plan
Bain’s case team applied our Radar 360 Strategy to help Tata imagine its future state in detail, in what we call a “Today-Forward, Future-Back" approach. Together, we established their goal of a $100 million gain in incremental revenue and $30 million EBITDA within the first year. Our case team then looked into where the greatest opportunities and challenges lay—including the many inherent complexities in the approach they wanted to take.
Tata Steel’s sales and marketing team believed there was opportunity to sell steel the same way other packaged goods are sold in India: in small quantities, directly to customers.
“Anyone who wants to build their dream home [in India] has to go through a nightmare,” says Peeyush Gupta, VP of Marketing and Sales for Tata Steel. “You don’t know where to buy the materials, whether you are buying the right materials, or at the right prices. If we can go to a consumer and say, ‘Let [us] give you a product that is authentic, and has a price guarantee, and comes with a delivery service,’ we can create a very good business.”
Yet there was no local precedent. “This was quite unique and had never been done before,” says Bain partner John Sequeira.
The approach
The Bain team identified 12 opportunities for Tata Steel and ranked them based on their potential value versus ease of implementation. They then conducted interviews with individuals in markets ranging from B2B to consumer. Out of this work came three opportunities:
• A consumer homebuilder website to sell steel via ecommerce
• A lead management portal to connect distributors and sales managers
• A supply chain visibility tool so customers could track and plan orders
Of these, the first, which Tata Steel named “Aashiyana,” which can be translated as “a home,” was quickly transformative. The two teams produced the website within just eight months, with multiple cycles of design, prototype, and rigorous customer feedback. Aashiyana gave Tata Steel a new reach and scale, the ability to deliver anywhere, and earned it a reputation for guaranteeing quality.
“Aashiyana creates additional reach for us,” Gupta says. “We can supply to anywhere [in India] in 72 hours, so we are now digitally present in the entire country.”
And that was just one of three initiatives. Compass, a digital supply chain visibility tool, increased sales among the company’s B2B customers, while another, DigEca, addresses lead management and cross-selling analytics for small and midsize distributors of Tata’s products.
The results
These three fully functional portals have connected Tata Steel with new customers. The financials, adoption, and advocacy are strong on all three, and having them as strengthened the entire Tata ecosystem. People who purchase steel are more inclined to purchase other products as well.
in incremental value
in EBITDA
in incremental revenue expected over the next 3-4 years
