1he followlng arLlcle serles Market|ng |n Ind|a" wlll cover koLLler's 4 s (roducL romoLlons rlce

and lace) wlLh focus on Lhe lndlan markeL 1hls flrsL arLlcle wlll Lalk abouL Lhe rlghL producL sLraLegy
for Lhe lndlan markeL 1he upcomlng arLlcles wlll Lhen cover Lhe promoLlon prlce and dlsLrlbuLlons
sLraLegy for lnLernaLlonal companles whlch wanL Lo successfully sell Lhelr producLs ln lndla
When launchlng new producLs ln lndla companles should look aL Lhelr producLs from dlfferenL
perspecLlves and Lhen Lry Lo cover each aspecL sLep by sLep ln order Lo develop a successful producL
sLraLegy for Lhe lndlan markeL 1he mosL lmporLanL parL of a producL ls Lhe core funct|ona||ty
LlecLronlc producLs normally don'L need Lo be adapLed Lo Lhe lndlan markeL Samsung's LCu's look
Lhe same ln uubal Pong kong and new uelhl 8uL ln Lhe food secLor for example producLs almosL
always need ma[or changes (example more splcy LasLe removal of nonvegeLarlan lngredlenLs eLc)
Also Lhe usage of producLs can be very dlfferenL ln lndla 8laleLLl could noL manage Lo sell Lhelr Moka
Lxpress ln lndla (even lf produced locally) Moka Lxpress clalms Lo be tbe wotlJs oombet ooe coffee
moket buL lndlans [usL dld noL llke Lhe LradlLlonal way lLallans make Lhelr coffee aL home lnsLead lL
Lurned ouL LhaL lf lndlans make Lhelr coffee aL home Lhey wlll buy Lavazza's coffee capsule
Lechnology machlnes 1o know lf Lhe core funcLlonallLy and Lhe way of usage of a company's producL
ls golng Lo be accepLed by Lhe consumer ls Lhe key elemenL when developlng Lhe rlghL producL
sLraLegy for Lhe lndlan markeL
The second aspect marketing managers should look at when developing their product strategy
Ior the Indian consumer market is: packaging. The most common example used in marketing
text books is the 1 Rs. (0,02 t) shampoo pack. Sunsilk, Unilever`s leading hair care brand,
can be Iound at every corner shop in small packages (enough Ior using it once or twice or
maybe just to try it out). The reach oI smaller packs is much wider, and considering India`s
huge population a lot oI small packs can result in quite high overall sales. Another example is
the Italian company Perfetti Jan Melle, which started by selling single packed chewing gums
branded 'Centre Fresh at 50 Paisa (0,01 t!). PerIetti`s product strategy Ior the Indian market
worked out: now they have 18 diIIerent brands and are market leader in the Indian
conIectionary market.
Changing the package size and looks is not always necessary. Keeping the same look and size
has a 'global recognition advantage. Red Bull`s energy drink cans Ior example have the
same size and design and are going oII the shelI very well in India. Still, some Iormal
changes, like adding the MRP (Maximum Retail Price), indicating iI the product is vegetarian
/ non-vegetarian and the address oI the importer and distributor, are mandatory (this applies
to every consumer good sold in India).
Along with the packaging comes the -7and name. A strong brand name like 'Harley
Davidson (which recently entered India), can surely make a big diIIerence. II a company
does not have a global brand name, it should consider renaming its product Ior the Indiana
market. Choosing the right brand name is a Iundamental part when developing a product
strategy Ior the Indian market. The German Ice cream maker Langnese-Iglo Ior example is
selling its ice cream under the angnese brand in Germany, but it is retailing under the brand
name Walls in Asia. With 18 oIIicial languages and thousands oI dialects, Iinding the right
name Ior a product may be a diIIicult task and beIore launching a new product nationwide,
overseas companies should ask Ior advise Irom marketing experts and potential consumers in
diIIerent regions oI India. In this way, selling in India is almost like selling in Europe, with its
diIIerent languages and customs.
Last, but certainly not least, international companies have to oIIer a good 8ale8 8e7;ice and
afte7 8ale8 8e7;ice. Like in every country a well organised and eIIective customer service,
warranty services, Iree home delivery and other 'goodies will increase customer
satisIaction. Global companies should try to build up a strong relationship with their
customers and oIIer locality schemes along with their products. This is also a way to gain
valuable customer insights and can be used at a later stage to introduce better products.
ort |n |nd|a
Entering the Indian market by expo7ting to India (directly or indirectly) requires only a
small investment Irom the producer (e.g. market research, trade Iair participation, B2B
Meetings, eventual travel expenses etc.)
Di7ect Expo7t means the producers sells directly to the importer / distributor in India.
Whereas in the case oI indi7ect expo7t, a European broker / trading company or the
importers subsidiary in Europe will buy Irom the producer and sell to the the importer in
India. Indirect Export i8 the ea8ie8t way to 8ell in the Indian ma7ket. The producer does not
even have to deal with international billing, shipping documents or payment methods.
Investments and risks are very low. The drawback oI the indirect export is that the producer
can not really control where his products end up and he most probably will ne;e7 -e a-le to
-:ild hi8 own -7and in the Indian market.
Since exporting to India involves minimal costs and risks producers can oIIer a lower product
price. Moreover many European trade and government associations subsidies export
promotion activities.
The disadvantage, which come along with exporting, are the rather high t7an8po7tation
co8t8 to India, high impo7t d:tie8 and othe7 ta7iff and non-ta7iff -a77ie78. Also the
producer will have no or little understanding oI the Indian market and will not be able to
anticipate changes in consumer demands. Being a pure exporter will also create some image
problems, since the European company will never be considered as an Indian player, which
means no local and fa8t afte7 8ale8 8e7;ice. An other risk Iactor when exporting to India are
the currency Iluctuations. The Indian Rupee / Euro exchange rate keeps on Iluctuating /-
15, making it diIIicult Ior indian importers to work out their long term pricing strategy. II
the Rupee looses too much against the Euro, this could mean the importer will stop buying
Irom Europe and procure Irom other countries.
Still, expo7ting to India 7emain8 the mo8t fa;o7ite ma7ket ent7y 8t7ategy. At least Ior the
beginning. Many European companies decide to start with export and once a certain trade
volume is reached and they are sure that their products are well accepted by the Indian
consumer, a Ioreign direct investment to set up their own subsidiary in India can be made.
Many global beer brands (like Fosters, Tiger or Carlsberg) initially used to export to India
and only aIter reaching a certain threshold volume, started to produce locally in India.
ocat|on
Where to start your market entry in India?
Remember: the three most important things when starting a business: ocation, ocation,
ocation!
BeIore entering the Indian market companies should study the various clusters available in
India. Especially iI companies are planning to produce or assemble in India, a thorough
location analysis should be carried out beIore going ahead with the market entry in India.
There are plenty oI industry and technology clusters across India. Clusters include producers,
suppliers, distribution partners, universities and clients.
Did you ever wonder why in certain areas oI a city or state all the shops sell the same kind oI
products? Wouldn`t it make sense to have a bigger variety oI products in one location?
No, says the Michael Porter`s Cluster theory: industry and business clusters can inc7ea8e the
p7od:cti;ity, d7i;e inno;ation and 8tim:late new -:8ine88.
Because oI the Iavorable surroundings and available resources, companies in clusters have a
competitive advantage. Silcion Valley in CaliIornia Ior example can be considered as an IT
Cluster. Global companies Irom the soItware and computer industry may consider to set up
their shop in Bangalore (India`s Silicon Valley) when they plan their market entry in India.
Another example is Pune, which can be considered as the car manuIacturing cluster.
Mercedes together with TATA decided to set up their assembly line in Pune (south oI
Mumbai), which by now is one oI the premier industrial centres oI India and is home to
domestic (Bajaj Auto) and international car producing companies (like Volkswagen) and has
become the number one destination also Ior companies in the engineering and electronic
industry.
Analysing and evaluating various locations and industry clusters is a very important part
when planning your market entry in India.
@|m|ng
hoo8ing the 7ight timing to ente7 the Indian ma7ket
AIter evaluating the chances and risks oI the Indian market companies can choose two market
entry options (in terms oI timing).
1. 1he Waterfall Strategy: Enter the Indian market region by region
When choosing the waterIall strategy to enter the Indian market a company decides to enter
Iirst one region (e.g. Delhi) Iollowed by other regions oI India (like Ior example Maharashtra,
Karnataka, etc.). This is advisable in most cases, since India is actually a subcontinent
consisting oI 28 states. Trying to enter all oI them in the same time can cost a company too
many resources. The risk oI Iailure can also be kept at a minimum level. The drawback oI
this strategy is that a company may neglect a region or segment and miss out on
opportunities.
. 1he Sprinkler Strategy: Enter the Indian market on a national level
II this strategy is applied, a company decides to enter India on a national level. This will give
an immediate and nationwide impact and crate brand awareness all over India. This strategy
is normally used in the technology sector and requires more resources and involves higher
risk. The advantage is a relatively Iast market entry and high R&D costs oI a particular
product can be amortised Iaster. For example the new 3G Apple iPhone was introduced by
Airtel all over India.
So which strategy to choose? It all depend8 on the ind:8t7y 8ecto7 and the p7od:ct8 which
a company wants to introduces in the market.
Whereas con8:me7 good8 (e.g. Iood products) should be introduced in the Indian market by
Iollowing the wate7fall 8t7ategy, companies Irom the high tech sector should enter the Indian
market by Iollowing the 8p7inkle7 8t7ategy.