Analysis of Indian industries

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Analysis of Indian industries

  1. 1. Analysis of IndianIndustriesProf. Ashwin MalsheMarketing Department – ESSEC
  2. 2. Agenda• Study four Indian industries • Luxury • Pharmaceutical • Cosmetics • Processed food• Mobile banking (if time permits)• Case study on HUL Pureit water purifier
  3. 3. Source of Data• Most figures in this presentations are taken from multiple sources. A primary source has been industry reports published by consulting firms. I attribute data to the sources wherever applicable.
  4. 4. Luxury Market• Indian luxury market size - $5.7 billion in 2010• Growth at estimated 20% per year • By 2015, the market size will be close to $15 billion• Six cities dominate – Delhi, Mumbai, Bangalore, Chennai, Hyderabad, an d Pune• Traditional ‘low margin, high volume’ model is restrictive for luxury penetration• Presence of multiple brands • Hermes, Paul & Shark, Diesel, Canali, Tumi, Aston Martin, Ferrari, Harley Davidson, Ducati, Kiehl’s, LOccitane, Hakkasan, etc. Source – AT Kearney
  5. 5. Luxury• Indian consumer • Many Indians became rich recently (post 1990) • The typical luxury customer may be labeled ‘Parvenu’ • Wants to associate with other ‘haves’ and wants to disassociate from ‘have-nots.’ Uses loud signals • Price sensitivity remains high • Mercedes diesel sells much more than petrol version • Discounts are considered as entitlements by the Parvenus.
  6. 6. Luxury• Trademark laws • Counterfeits are common • Less than China, however • Poseurs are more likely to use them • PC Mallappa vs McDonald’s case • Delay in courts• Sales culture • Incentives are variable in most cases • High fixed as well as variable pay
  7. 7. Hermes India
  8. 8. Hermes Saris• Priced at $6,100 to $8,400 (€4,700 - €6,500)• Limited edition
  9. 9. Hermes India
  10. 10. Hermes India• 3 outlets: Delhi, Pune, and Mumbai• Low advertising budgets• No difference in product or store design as compared to Paris• Excellent sales staff
  11. 11. Pharmaceuticals
  12. 12. Indian Market• Indian pharma market size was $11.6 billion in 2009 and growing at average rate of 14% annually • $20 billion by 2015 • Currently ranks between 10-14 in the world by size• Produces simple headache pills to sophisticated antibiotics • Almost every type of medicine is now made in India• 250 large companies control 70% market McKinsey and Corporate Catalyst India
  13. 13. Nature of Pharma Industry• From 1970 to 2005, Indian law recognized only ‘process patents’ and not ‘product patent’ • Many Indian companies started producing top notch drugs by changing process • This stopped with WTO adoption in 2005• Strong R&D base and low labor cost• Reaching the consumer through physicians • Direct to consumer advertising is relatively low
  14. 14. Emerging Trends• Global pharma companies are investing directly in India • Latest regulatory changes have created some challenges• Contract R&D • Drug discovery and development • Clinical trial organization• Contract manufacturing• Contract co-marketing alliances
  15. 15. Beauty Care
  16. 16. Indian Market3,000.02,500.02,000.01,500.0 2011 20121,000.0 2013 500.0 0.0 Hair Bath Skin Oral Mens Care and Care Care Grooming Shower
  17. 17. Whitening Cream• Largest selling beauty product in India• Women • Commercial • Pond’s series• Men • Commercial
  18. 18. al India• Entered India in 1993• Presence in 100 top cities and towns• Four divisions • Consumer products (Garnier) • Professional products • Active cosmetics (Vichy) • Luxury (Lancôme)• Own manufacturing in Pune for hair and skin care
  19. 19. al India Value Share RankBeauty and personalcare 3.50% 6Color cosmetics 13% 3Hair care 8% 4Skin care 6.50% 2Mens grooming 0.90% 14
  20. 20. Processed Food• Mumbai Dabbawalas
  21. 21. Indian Market10.0 9.0 8.0 7.0 6.0 5.0 4.0 3.0 2.0 1.0 2010 0.0 2011 2012
  22. 22. Packaged Wheat Flour• Pillsbury

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