While the ramifications of the attacks are as yet unclear, few observers think that India’s businesses will emerge unscathed. Coupled with the global economic downturn, it appears India’s brands will have a hard time of it in 2009.
Until the last quarter of the year, the story could not have been more different. India’s growing confidence on the global stage was best exemplified by its
140-year-old Tata business conglomerate, which launched the Rp 100,000 (US$2,000) Tata Nano car in a bid to bring affordable motoring to everybody.
While initially focused on India, many observers point to the car’s obvious potential in emerging economies as far afield as Russia and Brazil. For India, the Tata Nano could yet mark the country’s first bona fide global consumer brand, after India’s steady emergence from economic obscurity over the past 17 years.
“The one Indian brand that really started to fulfil its global aspiration in 2008 was Tata,” says Landor India client service director Lulu Raghavan. “Tata was first noticed globally after its acquisition of Corus the previous year but it was the innovative Nano, ‘the people’s car from Tata Motors’, that showed the world that global brand ideas can be born in India.”
To date, India’s global aspirations have been characterised by the likes of steel giant Mittal and IT player Infosys. In terms of real consumer exports, it appears that its automotive industry, also featuring prolific motorcycle brands Bajaj and TVS, will rise first.
A related sector - airlines - also made its mark this year, with Raghavan pointing to Jet Airways as another example of India Inc’s global potential. “It continues to be an undiscovered gem that global travellers are wowed by after experiencing the exceptional service.”
From a country of more than one billion people, two global brands is not really saying much. But Raghavan is not too downbeat. “With India becoming increasingly attractive as a medical tourism destination, I expect a healthcare brand like Apollo to shine,” she says. “Global brand building is an arduous journey and one that Indian brands are only starting now so it’s too early to talk of disappointments and setbacks.”
However, the growth of Indian brands overseas may stall next year, according to Punita Lai, executive director, marketing, at PepsiCo India Beverages. “Given the current economic downturn, companies are likely to protect their margins in their core businesses and geographies, so geographical expansion is likely to be slower.”
Sadly, one brand that will suffer untold damage is the ‘Incredible India’ tourism story that has been fashioned by Wieden & Kennedy India. “All that hard work will not be fully realised because of the fear that travellers will now have about visiting India,” says one agency source.
Lai agrees the attacks will have an effect. “There will be an impact on Brand India in the short term - to some extent the sheen that we wore of being the ‘growth opportunity’ of the world after China will take a hit. Foreign investments will probably wait and watch.”
It points to a difficult year ahead, although the tale of one Indian brand that truly succeeded on the global stage in 2008 should provide some inspiration. Shooter Abhinav Bindra nabbed India’s Olympic gold, in the process turning himself into one of the country’s most marketable commodities. “He will be a legend,” says McCann Erickson India chairman Prasoon Joshi. Whether his country’s brands can follow suit remains to be seen.
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