How TATA Motors used AI to reduce CAC by 75%

Did you know, players in the Automotive sector can use AI for improvised sales by connecting sales to marketing data sets which were used earlier? AI can be deployed to automate lead-management and related activities, in predicting which products are very likely to be sold to customers for now and in future. It can also be applied for dynamic pricing in the sales process.

Tata Motors Limited, India’s second largest car manufacturer, was looking to lower the cost of acquiring a customer (CAC). By CAC, they meant CAC in actuals and not the Cost Per Lead. The company wanted to lower the cost of acquiring a customer who would be purchasing the vehicle in their showroom. To achieve their goals, they began using Infinite Analytics’ AI platform, Sherlock AI in 2021.

Since last year, we, at Infinite Analytics, started working with Tata Motors with the objective of reducing the CAC, as well as work with their PV, EV and CV categories, in order to play a role in making them the largest manufacturer in India. 

In the course of this work, at the end of the third month, the CAC reduced by  75%, and Tata Motors acquired the capability to expand their dealer/showroom network in places of a potential high demand/growth. Earlier, each location for network expansion took over 5-6 months. Using Sherlock, they were able to reduce it to a mere few weeks. They were thus able to expand the network exponentially, using the platform’s algorithms (which algorithms).

Complementing our work, usage of social media also helped vastly. The company gained a new perspective in customer acquisition that no one in the market provided. The insights were crucial for their growth plans, the results for which have already started to show.