Indian Market – Articles and press releases mention regularly how lucrative Indian market is. They talk of the immense scope it possesses and all that. All those statements are absolutely true but what these firms forget is how difficult it is to make money here. They fail to understand the minds and thought the process of a typical Indian consumer. Indians typically say one thing, thinks something else, asks for something else and do something else. The startup boom is seeing mushrooming of startups everywhere and the pouring of money nonstop.
Now, how much of that money transformed into a real business and not just promises of breaking even soon?
Indian market is very complicated with lots of unpredictable dynamics. Change in India can be very slow sometimes because of its sheer size, tradition and the skepticism of being foreign. People tend to hold on to past beliefs and ways of working rigidly.
For example, cash will always remain king here and business will always be done on the streets. People still love to go to the traditional haats and bargain for dimes and pennies. At the same time stereotyping India as a whole will cost you a lot. India is a diversified country, where encountering a person who shops in the hi-tech mall and the other purchasing in roadside stall living in the same street is quite common.
But what does it take to be successful in the Indian market?
In the book, “Shantaram” by Gregory David Roberts based in India and on an Australian convicted fugitive who makes life here, the Indian friend of the protagonist says “In India, sometimes you have to surrender before you win”.
Here are a few points you might consider to surrender and not fight before you even think of winning.
Relation, not ROI rules Indian market:
India is a cultural hotbed with the taste of water changing every 1 Km and the language every 4 km. Relations here have to be built on the basis of trust, honesty, and integrity. Take the examples rid of Tata group who has become the epitome of doing business here. Anything they launch is taken seriously. People know that the production value is good for them. It took a decade for Baba Ramdev to build the same relation before he could actually launch his Patanjali.
Companies should focus on first appearing and acting as Indians and humility will go a very long way. Uber’s CEO Travis Kalanick on being questioned for nationality was prepared to be an Indian if it came to that. Snapchat’s CEO Evan Spiegel who allegedly made the “Poor Indian” remark has made sure that his product has become untouchable here. As said earlier, in order to fly high in India it is important to play safe. A business in this country is a game of mind rather than other deciding factors.
Masses not Classes
Today’s Bollywood makes the kind of movies that can bring to shame any Indian discussing their cinema abroad. I was questioned on the face – Do you people dance like that on street with your girlfriend after she has accepted your proposal? It makes you wonder, in spite of the degraded quality, why do the movies cross the 100 crore milestone?
The answer is masses and not classes. This may not sound to be a relevant example. But it is all about the content, masses are admired by people more than anything else. Hence, in a nutshell, it is the feeling that is enjoyed much by the India crowd rather than other things.
The movies just have to touch the taste of the masses and the population takes it from there. Imagine if the population had stayed with Orkut for some reason giving them a time to think. The mass exodus which killed it brought to life another brand and this transformation is quite common. The real talent is not in starting a business great, it is in making it great by constant monitoring and being up to date.
Many companies who fail here are all backed by strong numbers in the excel sheet. What you really need is to see is how many of them get converted into real business. Make sure that you are not misled by the excel sheet.
Free not Fee:
Reliance Jio “disrupted” the telecom market with 100 Mn subscribers in just 170 days. A feat unmatched by many big brands. Facebook has 213 Mn subscribers in India. Indians are very price conscious with little brand loyalty. What’s App had to ditch $1 annual subscription fee and rightly so.
Discounts play a major role in minds of consumers. Startups realize this and offer huge discounts especially during festive seasons. They make a big report and get huge funding. You don’t have to be a genius to form the obvious question, do you?
Once the funds dried up, the same startups start cutting corners while some shut down. In the next few years, we will be seeing a lot of startups whose business model was based on discount disappear. Just make sure that your model answers the obvious question before you think that you have caught the nerve of the market and jump in with lots of money.
High levels of Corruption
No one can put a point in favor of corruption as far as ethics and morality go and yet corruption has been thriving in India. The amount of money anticipated to be lost in corruption scandals is staggering. One can build the country and over again with that money. Surprisingly, the nexus between corporate and political parties do not come out in open that clearly. Lobbying efforts are suppressed in the first instance. It is widely talked that it is the red-tapism that makes the corruption rate in the country soar high. Indeed this statement is actually a fact, will you really undergo all these hectic process or bribe and get out of it.
Corruption is also seen as a way to go with life as following laws can be really difficult here. Most of the Indians will happily bribe a traffic cop and get through rather than face the whole process. It’s not that Indians are corrupt or bad, it’s just that the process itself is scary. No sane person would want to follow the process. A startup CEO thrown in jail in Bangalore is the best example of the process in which we don’t trust.
How did that happen?
Well, he messed up with a local MLA there who pulled strings to make sure he learned a lesson. We did.
Working here? You have to come to terms with this and thankfully companies know this. The Indian management makes sure that the foreign investors do not have to dirty their hands here. Neither do them. There are retired civil servants and cops on the payroll as legal counsel. When the time comes, they are the ones to get things done in silence.
The law is ours
Typical Indian fear if not really respects the law (Alright, this might be everywhere). But they know that even laws have their own limitations. The judiciary is slow and to a large extent blind. The lawyers come by dozen and for the cops, all you need is either some good connections or some cash. This sorry tale has been part of the country for so long that unfortunately, it has become an expected norm. Legal disputes get stretched and reaching a conclusion might look far out.
Before you think of entering the market be prepared for this and make sure that you do not leave room for the law to get into your business. The legalities in India is not in the linear format and it is quite difficult to understand the same. Hence it is mandatory to get a professional hand to be safe and clear about all the legal aspects of the nation. Get a good legal counsel to represent you and get your research in place regarding the domain.
India is a cultural hotbed with diversity heavily diverse. You will see people from all walks of life and mass communication can be difficult. The good thing is our exposure to and acceptance of the western way of living makes lives for foreign companies easy here. However, this acceptance is mostly above the middle-class level. People in lower economic level of society and especially in rural are still attached to the traditional values very rigid.
We are Indians
With the advent of mobile, a telecom operator launched postpaid connections some time back. People took connections with forged addresses and made an STD/ ISD booth out of it. They kept jumping the payments until the operator realized he was bleeding. Some had b***s to use the right address and ask the salesperson to come and collect the dues if they had b***s and wanted it. Welcome to India.
With all the technology in place cab sharing companies are also not spared. People use their own cars like taxis and pose themselves as users from a separate mobile number. This helps them get a free pick up and drop to the office with performance incentives.
One of my friend who teaches driving abroad told once, Indians tend to jump processes regularly and get their license done. If demonetization could not stop us, nothing in the whole world can.
It is the foreign firms who have to change and adapt themselves if they want to work and be successful here. Yes, it is true that Indians fancy all the products and cultures of other countries, but at the same time, it is definitely not a wise decision to think that people will adapt to the same. It is to be noted with the care that Indian’s are obsessed with their culture and traditional practices, that makes the need to incorporate the Indian taste in every business that steps into the great Indian market.
The article is not meant to portray India or Indians in poor light but present the true picture of India to firms or brands trying to enter India. It is a rough and unpredictable place to work in but if Apple can be successful here, so can you. All you need after the right resources is a very good understanding of the Indian market and as said earlier, you need to surrender to be successful here.