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From Gandhi to Gucci: a tale of two Indias

Much has been made of India’s brisk economic march and that in the global comity of economic superpowers, India is inching towards the high table but the fact is that there are two Indias and both shall remain for a long time to come. One which still experiences the ravages of poverty and poor infrastructure while the other that sees luxury brands tempting the now-rich-and-arrived Indian. But brands in India, more than the politician ironically, have understood the power that both these Indias possess in their own unique way. Much of what happened in 2009 in the world economy escaped India only because while one part had become dysfunctional (no de-coupling here), the other was happily untouched by the global meltdown, which is what continued to propel India’s almost-8% GDP growth.

But the real story of India and the brands within, is in effect the story of the quintessential Indian consumer and the DNA which remains largely unaltered. So while on the one hand, 185 Bentleys were sold in 2009 in India, the country also witnessed the launch, and then the delivery of the Nano: a $2500 car from the house of Tatas. From October, 2009 to January, 2010, the Tatas have already sold more than 16,500 Nanos: in a country, which also boasts of the world’s largest two-wheeler population. But to understand India and the play of brands within, one will have to understand the paradox that India is: the world’s youngest country (in terms of demographics) with the world’s oldest Cabinet governing it; the world’s largest democracy which continues to elect dynasties: sometimes even at the state level and the world’s largest linguistic pattern with global and local brands jostling for the same billboard. But the learnings that this market provides are many. And only those brands do well in India that first attempt to understand the Indian idiom of consumption and then begin tweaking their products. McDonalds had to dump the beef burger and replace it with the potato version only so that they could reach out to the vast swathes of vegetarians in India.
Gujarat, which was the state where Mahatma Gandhi was born is a dry state (no alcohol served) but has the largest consumption of beer and white spirits so that drinks can be suitably disguised. There are several such instances of unique Indianness and most corporations doing business in India understand that. When the music channel MTV began operating in India in the 1980s, their music was 100% western, but now all of MTV is pure Indian music.
In many ways, the average Indian has forced companies to do three principal things:
-       change the manner in which they present products before this market: the family unit remains the most compelling buying entity for an average Indian home: which means it will be a long-time before you see homes with multi-brand toothpastes or shampoos or soap: thus the lowest common denominator is almost always price with reasonable quality: given our colonial past, there is a cynicism which pervades all classes in India and there is the constant fear of being taken for a ride: hence the price-value equation has to be the bedrock for any brand to survive and succeed
-       the Indian consumer is perennially aspirational and sometimes it is more peer pressure than genuine need that drives consumption: it is unarguably the world’s largest body of hoarders and re-users: there is nothing that the Indian throws away: which means brands have to look at sturdy and enduring products and only those that fit the bell will find their way to the consumer: for instance, a torn undershirt becomes the duster; a used toothbrush is employed to clean re-cycled water bottles and India refills 87% of the disposable cigarette lighters: at a fraction of the already low cost of that lighter: this is a trait that has now been built into the way brands create customer service and warranty programs: even a low-cost car like the Nano comes with a 2 year warranty
-       the Indian consumer is perhaps the most fickle when it comes to brand loyalty and is game for trying out what’s new and what’s faddish. Urban cities in India enjoy more restaurant closures than perhaps Manhattan and it is because the Indian consumer is an enduringly experimental animal.
There are many multi-national and local companies that have managed to cross the bridge in terms of understanding India and the Indian consumer and that too across both Indias. When McDonalds changed their global menu for the first time, they did it bearing the potential of the Indian market. Today they are growing at almost 40% year-on-year and that too with rising food costs. The Tatas have launched a slew of products for the less-fortunate India: from cheap cars to cheap water-filters: the latter being critical given the quality of drinking water in India. Reliance Communications changed history when they priced their cellular tariffs at 50 paise (less than 2 cents) per call: the cost of mailing a postcard: today, Tata Docomo has changed the rules by pricing text messages and calls on a per-second rather than pulse basis. Interestingly, India is the inventor of the missed call: a no-cost signal to either tell your wife to lay the dinner when you are approaching home or to ask your chauffeur to bring up the car without spending a dime! But then these are the traits of the India that is slowly but surely nothing up tremendous economic prowess as the world continues to reel with zero growth.
Which is why this country breathes so easily with venerating a man who changed India’s history by marching across the country and obtaining Independence as also by walking out in their Sunday best in their latest Guccis bought in some luxury mall. The paradox is what drives India. Both in terms of a knowledge power which still grapples with 67% illiteracy as also an economy that is threatening to take over the world. Bric by bric as it were.

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