Lessons romthe Maharaja Macby Lulu RaghavanDecember 2007

Lessons romthe Maharaja MacFive rules orentering theIndian market

Maharaja MacLulu RaghavanDecember 

Lulu Raghavan

simply tweaking brand strategy at the regionaland country levels is doomed to ail.A recent study by McKinsey suggests thatmultinationals that have had the most successin ndia have approached the market rom a reshperspective, resisting the urge to simply transplantwhat has worked elsewhere.

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hey have beenwilling to create local brand strategies romscratch. Similarly, the Boston Consulting rouphas concluded that winners in ndia can beseparated rom losers by their ability to recognisendia’s unique characteristics and align theirbusiness models accordingly.

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As corporate boardrooms around the planetstrive to cra brand strategies or the ndianmarket, they would do well to draw on lessonslearned by multinationals with many years oexperience in the country. hese lessons providea basis or ormulating and executing successulbranding strategies in a notoriously complex andidiosyncratic market.

When McDonald’s replaced its bee-basedBig Mac with the mutton-based Maharaja Macin India, skeptics shook their heads. Afer all,no one had ever successully marketed aburger made o anything other than bee.But McDonald’s aced a dilemma: how tosell hamburgers in a culture where thecow is sacred.

As it turned out, the mutton burger was atremendous hit. n addition to the Maharaja Mac,the company now sells cottage cheese wraps andpotato patties to its growing Hindu clientele. hissuccess has allowed McDonald’s to shape andgrow the ndian ast ood market while capturinga large slice o the growing pie.

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Like McDonald’s, most global companies haveound that building brands in ndia is no easy task.hey have had to signicantly alter their globalstrategies or the ndian market. Because the ndianmarket and consumer dier signicantly rom therest o the world, the tried and tested approach o

 Kishore Dash, “McDonald’s ndia,” hunderbird Schoolo lobal Management (), http://www.thunderbird.edu/wwwles/pd/about_thunderbird/case_series/a.pd (accessed  March ). Kuldeep P. Jain, Nigel A. S. Manson, and Shirish Sankhe,“he Right Passage to ndia,”

McKinsey on Finance

(Winter ), http://www.mckinseyquarterly.com/article_abstract_visitor.aspx?ar= (accessed March ). he Boston Consulting roup, “ndia: he Next Frontieror Consumer Companies” (), http://www.bcg.com/publications/les/ndia_he_Next_Frontier_or_Consumer_CompaniesJul.pd (accessed  March ).

Maharaja MacLulu RaghavanDecember 

Korea’s L Electronics seems to understand thisprinciple very well. ts corporate headquarters tookon the burden o expensive national advertisingcampaigns or its ndian subsidiary to establishits brand with ndian consumers. his investmentallowed L to maintain price competitivenessdespite its massive advertising spends. hecompany even invests in making its expatriatemanagers eel comortable at home in ndia.Korean-speaking maids who can cook Koreanood are dispatched rom Seoul to make adjustingto ndia much easier or the Koreans, therebyincreasing their motivation and productivity.

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Rule 2:Reach out to the consumer

wenty years ago, ndian consumers hada reputation or blindly accepting most importedWestern goods. But consumer behavior hasundergone major shis since then, and it isimportant to understand the uniqueness othe ndian consumer today. hey are extremelyvalue-or-money conscious and highly demanding.hey careully consider eatures, unctionality,and service levels at all price points. Analyzingmarket potential and brand awareness cannotreplace real-world consumer understanding andrsthand experience.arget roup ndex (TGI) has compared brandbuilding in Brazil, Russia, ndia, and China. tssurveys suggest that global advertisers can beexpected to “experience the widest divergencerom international norms” in China and ndia.

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Even so, these two rising economic powers areremarkably dierent consumer markets. Korea’sDaewoo Motors, or example, tried to adapt itsMost multinationals that have built strong brands inthe country have been guided by a simple mantra:“hink dierently about your ndia strategy.” nparticular, they have been willing to completelyrethink issues around

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Brand investment

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Consumer ocus

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Localization and innovation

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Market segmentation

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Regional diversityn the ollowing sections,  propose ve rules ormaximizing branding success in ndia.

Rule 1:Invest in your brand

o successully build a brand in ndia, you will needpatience and a long-term view o the market. Morethan in any other part o the world, you must beprepared to invest time and money beore yourcompany starts to see nancial returns. Keep inmind that ndian consumers like to do businesswith companies that have been around or a while,so you can’t just bring your brand to ndia andexpect to see prots rom day one.he ndian market is complicated, diverse, andidiosyncratic. t takes time to understand ndianconsumers. t takes time to localize products. ttakes time to navigate through the red tape. t takestime to acclimatize to the diversity and constantcontradictions that dene ndia.Coca-Cola, orexample, has ound the ndian market very toughto crack. t reentered the country in the 10s aera 16-year absence and did not begin to turn a protuntil 2006.

Doing well in India dependson a willingness to thinkdiferently about all aspectso the business.

4 Archna Shukla, “Cola Majors Bet on the Fizz in ndia,”Livemint.com (9 April ), http://www.livemint.com//4/9494/Cola-majors-bet-on-the-zz-in.html (accessed 4 April ); and Jennier Kaye,“Coca-Cola ndia,” business case or uck School oBusiness at Dartmouth (4), http://mba.tuck.dartmouth.edu/pd/4--.pd (accessed 4 April ). Masanori Kondo, “Success o MNCs in ndia: MarketResearch, Product Localization and Advertising,”

Weekly Economist

(July ), http://www.nihongobashi.com/news/japanese-mncs-.html (accessed  March ). , “Brand Building in the BRCs,” http://www.tgisurveys.com (accessed  April ).