Author: Editorial
Publication: The Economic Times
Date: April 26, 2002
Predictions about the death of Indian
brands have clearly been premature. In fact, as a recent study by ORG-Marg
shows, local brands manufactured by small companies are flying off the
shelves in the fast moving consumer goods (FMCG) market.
You could be forgiven for not having
heard of Kalisuri Oil Mills, but Gold Winner, the aptly named cooking oil
it makes, grew 43 per cent in a year, making it the fastest- growing FMCG
brand in the country today.
Out of the 10 fastest-growing brands,
only three are owned by MNCs: HLL's Breeze toilet soap and Rin washing
powder, and Nestle's Maggi noodles, the favourite carbohydrate shock for
schoolchildren in urban India.
With 70 per cent of the 10 fastest-moving
FMCG brands locally-owned, local businessmen who went through a period
of morbid multinational-phobia, can finally afford to sleep at night.
There's a lesson here for almost
every marketing guru who predicted that MNCs' vast resources and adspends
would consign desi brands to dusty corners of shopshelves.
Marketing is actually a tougher,
more subtle game than just shovelling out cash and dealer discounts. In
fact, the only safe generalisation to make is don't generalise.
One of the first multinationals
to absorb this lesson successfully was McDonald's, which customised its
globally-standardised burger to suit desi palates and customs.
Vegetarian and chicken tikka burgers
worked; Kentucky Fried Chicken, which couldn't adapt, failed. Meanwhile,
Haldiram's grew from a packed dalmot seller to a nation-wide fast food
chain.
Yes, multinationals have taught
Indian companies the value of good packaging, prompt services and competitive
pricing, but to their eternal credit, local businesses have used these
lessons to their own advantage.
In fact, the smaller overheads and
costs of desi establishments have been an advantage in a market downturn.
Local producers can afford to cut
prices more sharply than MNCs can and that has attracted consumers looking
to tighten belts.
Learning is a two-way process. As
HLL, one of the most successful divisions of Unilever world-wide proves,
India has as much to teach the overseas corporate as the multinational
has to teach India.
