2. Agenda
• Study four Indian industries
• Luxury
• Pharmaceutical
• Cosmetics
• Processed food
• Mobile banking (if time permits)
• Case study on HUL Pureit water purifier
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. 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, L'Occitane, Hakkasan, etc.
Source – AT Kearney
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. 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
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
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. 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. 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
17. Whitening Cream
• Largest selling beauty product in India
• Women
• Commercial
• Pond’s series
• Men
• Commercial
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. al India
Value Share Rank
Beauty and personal
care 3.50% 6
Color cosmetics 13% 3
Hair care 8% 4
Skin care 6.50% 2
Men's grooming 0.90% 14