India rocks the world with Aloo Tikki Burger

Across the continents of Africa, the Middle East and South Asia, a new label is quietly making its presence felt in shops. The label is 'Made in India', sported by various products across categories .

Of course, the tag has been making global waves for a decade or so, with information technology, BPO and even Indian companies featuring in the elite group of Fortune 500.

But the difference, in this case, is that the label is on products developed by Indian subsidiaries of MNCs, which have been rolled out across markets. Not impressive enough? Here's the clincher.

They are products, customised for India, which now have markets across the world.

It's the R&D and innovation prowess of the Indian operations, which is enabling these companies to shift the scales of the localisation-globalisation balance.

According to Yoram 'Jerry' Wind, professor of marketing at Wharton, India is a great market place for many products, but to get a captive audience, customisation is necessary.

"You cannot just dump the US-made products into India. There will be a certain market for them, but localisation is critical," he says. Consider the grand old fast food behemoth, McDonald's: the re-engineering of its menu to suit the Indian palate has also appealed to the gourmet senses of customers in Middle East.

So the Aloo Tikki Burger and Pizza McPuff are now being exported, while McDonald's testing out the McCurry Pan for possible roll out in other markets.

At Cadbury, Chocki was the first liquid chocolate brand to be developed in India. It's now is exported to various countries in Africa, been launched in Pakistan and there is even a variant in Poland.

There's now overseas interest in the snack brand Bytes as well. Bharat Puri, MD, Cadbury, claims that the success of Chocki is sure to help it succeed.

Coca-Cola India also has a feather in its cap. Its Georgia Tea and Coffee brand exported the vending model adopted in India to the Middle East and South-East Asia. "Nowhere in the world had Coke tried the vending model for selling Georgia Tea and Coffee.

The innovation was purely Indian," claims Shripad Nadkarni, former marketing head at Coca-Cola India. It's now part of the mbutt tea and coffee initiatives for Coca-Cola across the globe.

This has been a part of a slow and steady process for Indian subsidiaries, who have spent years tweaking, innovating and doing customisation research.

Thus companies like LG, Samsung, McDonald's, Nokia and Cadbury have rolled out products designed for Indian conditions and consumers.

Says Ravinder Zutshi, deputy MD, Samsung India, "India was no dumping ground and that was clear right from day one that we landed in the country."

Similar strategy was followed by Samsung's fierce rival, LG. According to KR Kim, MD, LG Electronics India, localisation was the mantra as the need was to meet the local demand in India.

That paved the way for TV sets with louder sound capabilities, built to withstand erratic power supply situations. "It was critical for us to build up the acceptance here for the brands in our portfolio," he says.

The emphasis on localisation and the consequent impetus on R&D and innovation, has opened other doors for these products. Amit Jatia, MD, McDonald's western India, explains that the vegetarian range devised by McDonald's India isn't available anyway else - the successful innovation has made people look at the Indian operations in a new light.

"Our credibility for product development has gone up. People from other global centres want to know more about India," he says. Meanwhile, Kim talks about exports from LG India touching 30% of the company's total revenue from India operations by 2010, from the present 5%.

Home Rules

The top management of Samsung Electronics has identified India as one of the top six strategic markets in the world along with the US, China, Russia, Germany and Thailand.

Accordingly, last year a decision was taken by the Samsung management to create a South-West Asia regional headquarters with India as the hub for SAARC markets, excluding Pakistan.

"We now export televisions and refrigerators to the Middle East and CIS, and in sometime will be exporting washing machines as well," says Zutshi. He adds that last year, exports from India touched Rs 40 crore and will touch Rs 100 crore this year. "

The current investment in R&D is around $3-4 million, and we will pump in another $12 million for innovation," he says. Wind feels that players can develop products for India anywhere in the world, but it's the talent and the low labour costs which make business sense to develop R&D in India. "

An MNC would look at the talent pool available at the most attractive price. Once products are developed for India, the company realises that it has application in other markets as well," he says.

The key to this outbound movement is the dynamics of the Indian market. So if a television set or refrigerator is customised to withstand the erratic electric supply locally, a similar market conditions exists in Africa.

McDonald's India's vegetarian spread attracts attention because the worldover, there is a shift towards vegetarianism, and operations across the globe would be interested in taking a thing or two out of India. Puri attributes this to a certain degree of similarity which exists between India and other emerging markets.

"Everybody is looking to exploit the idea, and geographical barriers are no longer a hindrance. India, given its diversity, provides the depth needed in understanding the consumers," he says.

Localisation is high on the agenda for these companies as a lot of ground needs to be covered in India, but enquiries from other operations have enabled these subsidiaries to either export or share the idea to be manufactured locally in other markets.

"There is no doubt about the importance of India - it's a main market, not a test market. Yes, there are similarities which we exploit," says Kim of LG.

The steps towards moving into the big league have been taken, but the Indian subsidiaries know that a lot more needs to be done as similar efforts will be underway at other operations across the world.

At the same time, the emphasis on India cannot be overlooked in the quest for other markets. The walk between localisation and globalisation for these companies will continue to be a tightrope.