Embed Size (px)
Citation preview
Marketing in India
A Market Focus OverviewPrepared by:
Jasjit Singh
Harmandeep Deol
Neha Randhawa
Agenda
2
1) Land & Climate 5) Government & Economy
2) Language & Religion 6) Agriculture & other Industries
3) Natural Resources & Hazards 7) Imports & Exports
4) Population 8) Poverty & Corruption
9) Why Invest in India? 12) Cultural & Marketing Value Differences
10) Market Research 13) Ease of Business in India
11) Maslow’s Hierarchy 14) McDonald’s Example
About India
Marketing in India
Fun Facts• Home to Taj Mahal – one of the wonders of the world
• Chess was invented in India
• “Pi” or π was first calculated by Indian mathematician
• Indian’s can eat spicy food!
• World’s largest producer of licit opium for the pharmaceutical trade
• India was one of the richest countries in the world prior to the British invasion in 17th century
3
4
Land & Climate
5
• Area: 3.3 mn km2 (compared to Canada, 10.0 mn km2)
• Bordering countries: China, Nepal, Pakistan, Bangladesh, Bhutan and Burma
• Terrain: Upland plain in south, flat to rolling plain along Ganges, desert in west, Himalayas in north
• Climate: Varies from tropical monsoon in south to temperate in north
Language & Religion
6
• 15 official languages, 1 unofficial language (English) widely spoken
• Official languages: Hindi (41%), Bengali (8.1%), Telugu (7.2%), Marathi (7%), Tamil (5.9%), Urdu (5%), Guajarati (4.5%), Kannada (3.7%) and others
• Over 200 dialects spoken across nation
• Religion: Hindu (80.5%), Muslim (13.4%), Christian (2.3%), Sikh (1.9%), others (1.9%)
Natural Resources
7
• Coal (fourth largest reserves in world)
• Iron ore
• Manganese, mica, bauxite, titanium core, chromite
• Natural gas, petroleum
• Diamonds
• Limestone
• Arable land
Natural Hazards
8
• Droughts
• Flash floods
• Monsoons
• Earthquakes
• Recently active volcano (Barren Island in Andaman Sea)
9
Population
10
• Population of 1.2 billion as of July 2014; 2nd to China… Population of 34.8 million in Canada
• 36.4 population per square km… Very dense!• 3.2 population per square km in Canada
• 31% urban vs 69% rural
• Population growth: 1.25% est.
• Life expectancy:
• Males 66.7 years old (79.1 yrs in Canada)
• Females 69.1 years old (84.4 yrs in Canada)
(Million) Population
New Delhi 22.7
Mumbai 19.7
Kolkata 14.4
Chennai 8.8
Bangalore 8.6
Hyderabad 7.8
Population Distribution
11
(Million) Population
< 15 yrs old 28.5%
15-24 yrs old 18.1%
25-54 yrs old 40.6%
55-64 yrs old 7.0%
65+ yrs old 5.7%
Median Age 27 yrs old
People
12
• Ethnic groups: Indo-Aryan 72%, Dravidian 25%, Mongoloid and other 3%
• Adult literacy rate: 62.8% (compared to 99% in Canada)
• Major socio-economic issues such as malnutrition, child labour, economic disparity, poverty (30% pop’n below poverty line)
• Children <5yrs underweight: 43.5% (virtually non-existent in Canada)
• Child labour (5-15 yrs): 27.0 mn
13
Government
14
• 29 States, 7 Union Territories
• Gained Independence from the British in 1947
• Legal system: Common law based on English model• Separate personal law codes apply to Muslims, Christians and
Hindus
• Judicial reviews of legislative acts
Government
15
• Chief of State: President & VP
• Government Head: Prime Minister
• Legislature – bicameral
• Council of States (245 seats) and People’s Assembly (545 seats)
• Parties: Multiple (21+)
Prime Minister of India
16
• Narendra Modi is new prime minister of India
• Assumed office May 26th, 2014
• Leader of the Bharatiya Janata Party (BJP)
• 2012 Internal BJP documents…• “BJP has opposed FDI (foreign direct investment) in multi-brand
retail right from the beginning”
• “Small businessmen will be forced to down their shutters now”
• After taking over office, he’s soften his stance on FDI
17
Economy
18
• GDP (real): Y2010 = $1.73tn (USD) – 9th largest
• Compared to Canada Y2010 = $1.58tn (USD)
• GDP/capita (PPP): Y2013 = $5,410 (USD)
• Compared to Canada Y2013 = $43,100 (USD)
• Workforce: 487.3mn (19.1mn in Canada)
• Labour force by occupation:• Agriculture (49%), industry (20%), services (31%)
Agriculture
19
Rice Lentils
Wheat Onions
Oil Seed Potatoes
Cotton Dairy Products
Jute Sheep/Goat
Sugar Cane Poultry
Fish
Industries
20
Textiles Mining
Chemicals Petroleum
Food Processing Machinery
Steel Software
Cement Pharmaceuticals
Transportation Equipment Labor (Outsourcing)
Services
21
IT Services
Engineering, Business Services
Energy and Power
Hotel and Tourism
Retail
Transport Services
Banking and Finance
GDP per Capita based on PPP
22
Imports
23
• $467.5bn (est. 2013)
• Ranked 12th in the world
• Commodities include crude oil, precious stones, machinery, fertilizer, iron and steel, chemicals
• Import from China (10.7%), UAE (7.8%), Saudi Arabia (6.8%), Switzerland (6.2%), USA (5.1%) (est. 2012)
Exports
24
• $313.2bn (est. 2013)
• Ranked 19th in the world
• Commodities include petroleum products, precious stones, machinery, iron and steel, chemicals, vehicles, apparel
• Export to UAE (12.3%), USA (12.2%), China (5%), Singapore (4.9%), Hong Kong (4.1%) (est. 2012)
25
Income Equality
26
• “Rich” households ($35K+ income p.a.) 16 million
• “Middle-class” ($8K to $35K+) 160 million
• “Aspiring middle-class” ($3.5K to $8K) 359 million
• “Deprived” (<$3.5K) 684 million
• 170,000 millionaires and billionaires
Poverty
27
• Poverty in India is a systemic problem
• 30% of population living below poverty line
• 68.8% of Indian population living on less than $2 per day (est. 2010)
Corruption
28
Lack of Infrastructure
• Expensive Real Estate
• Low spending on Infrastructure
• Very low private sector spending
29
30
Why Invest in India?
31
• Underserved market
• Enormous market size
• Small but fast growing middle class
• Many potential consumers in upper-middle income class
• Growing software and electronics industry
• Outsourcing opportunities due to low salaries
• Profits $$$
Market Research is Challenging
32
• Lack of secondary data in public domain (gov’t census from 2001)
• Undocumented, outdated, fragmented data
• Digitization of records beginning to occur
• Consumer insights in English are not good enough (recall 15 official languages)
• Businesses and people suspicious of giving interviews or sharing information
… But it Can Be Successful
33
• Use multiple data collection sources
• Validate information
• Test and strengthen hypotheses
• Hire locals with experience
• Choose local partners for practical research approaches
Maslow’s Hierarchy
34
Relating consumption patterns and levels to basic human need-fulfilling behaviour
Self Actualization
Esteem
Social
Safety
Psychological
Status
Admiration
Affiliation
Safety
Psychological
Maslow’s Hierarchy of Needs Maslow’s Hierarchy: The Asian Equivalent
Cultural Values Differences
35
Classic Western Traditional Asian
Nuclear, family, self, or immediate family Extended family, blood /kinship/ work groups
Beliefs in competition, challenge, self-expression Beliefs in harmony, cooperation, avoiding confrontation
Personal responsibility, independence Shared responsibility, interdependence
Doing one’s own thing Public self and “face”
Resentment of authority Respect of authority
Primacy given more to youth and change Age and seniority important, value tradition
Control by “guilt” and conscience Control by “shame” and “loss of face”
Marketing Values Differences
36
Classic Western Traditional Asian
Brand segmentation; personal choice and self-expression through brand
Popular famous brands; confidence in brand and corporate names
Presenters/ testimonials important but more to draw attention to brands
Imitation, emulation, use of presenters as role models in ads
Seeding and diffusion from leading edge Rapid adoption of successful brands
Belief in “understatement” of wealth Display of wealth and status
Environmentalism Confidence in technology
37
Doing Business Criteria
38
Ease of doing Business in India
39
Business Registration
40
Business Registration - Comparison
41
42
McDonald’s India Menu
44
• http://www.mcdonaldsindia.com/happy-price-menu.html
McDonald’s in India
45
• Entered Indian market with two local partners – 50/50 Joint-Venture (first store opened Oct 1996)
• Religious views considered by McDonalds:• Indian’s don’t eat beef, cows sacred animal for Hindus
• Muslims don’t eat Pork
• Menu modification to suit local tastes…. major vegetarian menu play, spices, etc
• Ensuring diversity in product offerings while maintaining core brand image and affordable pricing
• Storefronts, kiosks, drive-thru, McDelivery
Thank you!
Q&A46
Bibliography
47
• Maps of India http://www.mapsofindia.com/maps/india/india-political-map.htm#
• CIA World Factbook – Indiahttps://www.cia.gov/library/publications/the-world-factbook/geos/in.html
• CIA World Factbook – Canadahttps://www.cia.gov/library/publications/the-world-factbook/geos/ca.html
• Open magazine wealth report http://www.openthemagazine.com/article/business/the-wealth-report
Bibliography
48
• Wikipedia
http://en.wikipedia.org/wiki/Economy_of_India
• World Bankhttp://data.worldbank.org/indicator/SI.POV.2DAY
• Transparency Internationalhttp://www.transparency.org/country#IND
• Global Marketing Management, 8th ed. Keegan, Warren J. pages 133-136, 171-172, 189
• Bharatiya Janata Party. (2012) http://www.bjp.org/images/publications/fdi%20booklet.pdf
Bibliography
49
• Price Waterhouse Cooper Indian Infrastructure Report
http://www.pwc.com/gx/en/capital-projects-infrastructure/assets/gridlines-india-article-2013.pdf
• World Bank
http://www.doingbusiness.org/data/exploretopics/starting-a-business
• World Bank
http://data.worldbank.org/indicator/NY.GDP.PCAP.PP.CD/countries/CA?display=graph
• McDonald’s in India
http://www.mcdonaldsindia.net/key-milestones.aspx
Bibliography
• KPMG
http://www.kpmg.com/IN/en/IssuesAndInsights/ArticlesPublications/Documents/KPMG-CII-Ease-of-doing-business-in-India.pdf
• Doing Business
http://www.doingbusiness.org/data/exploreeconomies/india/~/media/giawb/doing%20business/documents/profiles/country/IND.pdf
50
