Redrawing the battlelines

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: What a roller-coaster ride it has been! When direct selling company Amway entered India in 1998, it established its first warehouse in Nagpur thinking the city would become the hub for its distribution system. The logic: it was located at the centre of India! As orders started collapsing under the weight of deadlines, the company ‘fixed’ the strategic error by expanding its base. Error of judgments, like these, were not uncommon during the first flush of liberalisation when a bevy of MNC brands—with inadequate homework, deep pockets and visions of quick turnaround times— strutted into India.

That was then. With a firmer grasp of the Indian markets and the forces that drive consumers, The Next Wave is unfolding more systematically. Products are being tweaked to suit Indian palates and customer interface is becoming increasingly desi. Take American fast-food major Kentucky Fried Chicken (KFC), one of the latest to try the trick. Though the company remained in hibernation with a single outlet in Bangalore for many years, it has decided to enter bigger markets like Delhi this year. Its menu today has an overdose of not chicken, but vegetarian products—Paneer Wrap ‘n’ Roll, Veg Pulao and a complete Veg Thali!

Unbelievable as it may sound, but the 15 years since the markets opened up have been a long learning experience for these brands. The key, as they see it now, is to not rely on macro economic or industry data alone. The idea is to step back and analyse—learn from those who made it plus those who didn’t and benchmark against the best of class. Even if that means taking one step at a time. German carmaker Volkswagen’s India importer-distributor Anita Kashyap says, “One has learned out the mistakes other companies made with not choosing the right product for this country. So homework is essential.”

The carmaker is in no hurry to kickstart its India operations. It is pondering hard over which of its mid-segment cars will be able to lure the finicky Indian driver before jumping into the market (first Indian manufactured car expected only by 2008-09).