Opinion | Playing to aspiration isn’t enough while launching a global brand in India
Firms should prioritize research to deliver an entry strategy based on India’s vibrant diversity
Twenty eight—that’s the percentage that forms India’s middle class, as well as the country’s median age. Both indicate that India is well on its way to become one of the largest consumer markets in the world, and also the youngest. The middle class is growing, and not just in urban, but also rural areas. Nearly 40% of the population is between 25 and 54 years of age. These factors are enough to attract international brands to India, especially as global pop culture permeates—from music and TV series to sports events and culinary experiences. The government and private sector realize the potential and have focused on improving infrastructure, especially the tech infrastructure that’s giving a boost to e-commerce and banking.
While policy, regulation and investment are some of the more obvious challenges for global brands, the harder one to overcome is understanding that India is not a country, but a continent. The country’s diversity of mindsets and cultural nuances are factors that influence purchase decisions. Ignoring this while planning a company’s strategy to enter India may just mean it will end up packing sooner than it can say “we are thrilled to be here". This is why brands should prioritize research to deliver an entry strategy that’s based on the country’s vibrant diversity.
Going into the details
When an international brand comes to India, there’s often an aspirational value attached to it. While that gives a great initial boost, the long term success of the business will always depend on how well the brand understands its local users. If you want to enter the top six cities and then expand, make sure you already know what is happening in the next 10. Work with the right local partner in these cities to run product/service tests, do perception analysis, and understand purchase triggers that are often dependent on cultural nuances. Beyond the user, it’s essential to identify the local ecosystem readiness.
If research should lie at the heart of a brand’s vision, then consumers should lie at the heart of the company’s innovation. A one-size-fits-all macro approach just doesn’t cut it for India. We are rooted, but global, which is an oxymoron. This makes us more value conscious, constantly seeking experiences that are inspirational, but attuned to inherent local sensibilities. For a market as competitive as India, localization is the lifeline to business success. If this means having two products for India, so be it.
Even as Indian consumers become mature users of international products and services, traditional purchase triggers such as price, features, and convenience remain critical to making buying decisions. New drivers such as social impact, experience and brand mission are also becoming means for users to connect to their favourite brands. When users find brands resonating their values, echoing their self-expression, they not only turn into loyalists, but also act as brand advocates. Business values are a powerful anchor that inspire and connect people to the brand. If a global brand can inspire local consumers through culture and experiences that shape values and lifestyle, it stands a higher chance of standing out in today’s easy-to-imitate age.
The increasing use of technology, growing cross-border influences and a highly competitive landscape, constantly challenge brand loyalty. Success will be defined through intensive groundwork, having a service that matters to users, and the right team to drive the business home in the long run. Global brands must also be invested in India as responsible players, rather than looking at the country as a cash cow. And while competition may be immense, India is a market to develop, grow, and learn from, so stay committed and see the magic.
Amarjit Singh Batra is managing director of Spotify India.