Why Indian brands rarely go global

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Why Indian brands rarely go global

Tuesday, 31 May 2016 | Umang Srivastava

Because Indian companies cater to a large and diverse market at home, they have little incentive to up their game for the international market by investing in R&D, raising the quality of their products and vastly improving their work culture, writes Umang Srivastava

As one of the fastest growing economy in the world, India has a negligible presence in the list of top global brands. Even as Indian brands expand to foreign markets, achieving a global status does not seem to be their priority as opposed to making a quick buck and exploiting marketing opportunities as an ‘international brand’.

One reason for this could be that catering to a large and diverse domestic market such as India is challenging enough for most players. Going global means incorporating international norms and quality standards, while still serving domestic demands. This may seem like a monumental task.

Also, there is growing suspicion in the West about the quality of goods and services provided by developing nations and emerging markets. Human resources from India may be valued highly abroad but the world does not view Indian products and services with the same respect and trust.

Innovation is another area where Indian brands take a beating. While companies producing generic products abound, not many invest time, money and labour in R&D. This is evident from India’s poor position on the list of patent-earning countries.

All this can change, and Indian brands can make a name for themselves globally if they take the following steps.

Strategic partnership: A good way to access opportunities in the international market is by partnering with reputable brands in host countries. Joint ventures and strategic alliances can help Indian brands make a name globally.

look at how Starbucks has joined hands with Tata Global Beverages to open its stores in India, while many Bollywood production houses have collaborated with the likes Fox Broadcasting Company and the Walt Disney Company to get help with distribution in the global market.

Such collaborations can be the ideal first step for Indian brands wanting to go global. The Delhi-based start-up company Bonita, for example, has just entered into a relationship with Bed, Bath & Beyond — becoming the first Indian brand to sell products through the American retail giant. This gives Bonita a strategic presence across North America.

Enforcing Discipline: A disciplined work culture is the hallmark of Western industry while developing nations get a bad name for their easy-going attitudes. Market and regulatory institutions also have a role to play here: If India wants to establish brands that have global standards, quality and hygiene standards have to be raised across the board. If drugs produced by Indian companies fail to pass quality checks in Europe and the US, those companies cannot expect to find a place in the developed world; they can at best continue to capture market share in other developing countries.

Indian companies need to build brands which can be associated with discipline, business ethics, sincerity of service and top notch professionalism. They have to enhance quality, output and productivity.

Think global, act local: Any firm which wants to be involved in the global trade needs to follow the concept of ‘Think Global, Act local’. While maintaining international standards, the company also has to focus on the demands of global communities and ethnicities.

In this, one can follow the example of major foreign companies which function in India. look at the way they focus on local needs, exploit Indian tastes and preferences, while maintaining the business standards and core product values of their home country.

Invest in R&D: One can only go so far by producing generic products. Organisations which desire to make a splash globally need invest in R&D. However, due to the long gestational period involved, many Indian companies shy away from this domain. This needs to change if we have to produce globally competitive brands. This is one area where Bonita has laid special emphasis. It is working aggressively towards producing patent-earning products that can distinguish its brand at the international level. Bonita does not see investment in R&D as a liability — it views it as a strategic investment that will bring long-term dividends. 

Banking on Indian reputation: Globally, India, as a culturally rich and diverse nation with a unique history, raises many talking points. It has a reputation in many fields, from spirituality and yoga, to ayurvedic and herbal medicine, to flora and mineral wealth to human intelligence resources. This reputation can be exploited to establish a niche in the international market.

For example, brands can focus on India as a pioneer of healthy alternatives in medicine, the land of Darjeeling tea, the promoter of Yoga and classical Indian dance and music, even Bollywood, and as a home to highly capable IT professionals. This can help create a unique global footprint.

(The writer is joint MD of Bonita)

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