Nirmalya Kumar & Amitava Chattopadhyay pointing out the same strategy.....Someone really need to connect the dots!!!

‘Cos Able To Compete in Emerging Markets Will Rule the World’ Amitava Chattopadhyay, chair of marketing innovation and creativity at Singapore-based global business school INSEAD, says today’s emerging market multinationals will be tomorrow’s global leaders. The international branding expert talks about some of the ideas he has tackled in depth in his latest book, The New Emerging Market Multinationals, in an interview with ET’s Sudeshna Sen. Edited excerpts: India as an emerging market is currently going through a turbulent image phase; in the past year, perception about the country tanked, but now some light is seen at the end of the tunnel. How important is the brand of the country for emerging multinationals? The country brand is extremely important. One of the things emerging market multinationals have to deal with is the country of origin and the perceptions about it and associations related with it. Let’s go a few decades back. In 1981, it was a different world. The only thing western media projected about India was abject poverty. Today the stories in western journals are usually about what an Indian company is doing that is upsetting the applecart for western companies, or about policy initiatives like the recent spate of reform announcements, and discussions about that. You discuss emerging market brands. Many emerging market companies are choosing to enter other emerging markets, like in Africa, instead of developed markets. How important is it for an emerging market company to have a recognised brand in their portfolio, like a Jaguar, to be taken seriously in the global arena? That’s an interesting question, and a very western perspective. The balance of power is shifting. Growth in the developed world has faltered. All of modern history, it has been that the incumbent brand is the developed country brand. As the tide shifts, it will be the brands incumbent in emerging markets which are the incumbent brands globally. It is exciting to see these companies building brands. Look at Thums Up—it still is the largest cola brand in India, after 20 years of Coca Cola owning it. I think Parle was badly advised and undersold the brand at the time (Parle sold Thums Up and its other soft drinks to Coca-Cola for $60 million in 1993). If I own the equivalent of Thums Up in Africa, when the penny drops, and developed world MNCs start competing in Africa, brands that are local leaders will hold their own, whoever owns them. So what is the value of acquiring a big name global brand for any emerging market company? Take Tetley, for instance. That was the first big acquisition of Indian brand overseas, by the Tatas. The first time they tried, they did not have the financing in place. But there is no way Tata Global Beverages could have existed as it does today without Tetley. Tata Tea owned tea gardens and sold its produce in the markets in Calcutta. It sold its first branded tea in 1986; now, it owns no tea gardens and is a branded beverages player. No way     could it have done that without Tetley. Or take Jaguar-Land Rover. Tatas acquired JLR just before the Lehman collapse, so later everybody said you paid too much. But four years on, this company contributes disproportionately to the profits of Tata Motors. How important is the western perspective? After all, most emerging company MNCs need capital, and that’s still driven by western perspectives. There is a reason that instead of talking about cows in the street, western media is talking about policy initiatives—because that’s where the action is. That is why you have Indian CEOs at global multinationals. There’s a reason why Indra Nooyi is CEO of Pepsi, or Ivan Menezies is head of Diageo. The future winners will be the companies who can compete in emerging markets; it will not be companies who can grow their market share from 18% to 19% in developed countries. The importance of western perception is eroding. Yes, that perception matters, but emerging countries are beginning to see that they have a role. And there is talk of making funds available on a regional basis because emerging market companies see themselves as world players. All of this takes time. It takes time for people to get their heads around the idea of a change in perception. Bloomberg TV : Inside Strategy Series-II…. Strategy Tips from Dr. Nirmalya Kumar- London Business School… Authored Indian Global Powerhouse:- Here Going further deeper into Emerging Markets http://www.youtube.com/watch?v=mUjHlKGmF3c 1.       Segmenting the market and understanding the consumer is the key. It is the starting point for both Strategy & Marketing. 2.       One product is just not enough, company needs a basket of products. If you have strong umbrella brand, develop and nurture more n more Sub-Brands….make them self sustainable. 3.       Value Vs Volume. 4.       If Co. has a customer, Co. need to innovate to maximize its offerings to that customer. 5.       Ancillary services can be highly profitable. 6.       Profit Migration Path with the customers…Ex-Bank sells various credit instruments to Saving/Current Account Customers. 7.       Strategy of volume have to be 3 to 5 yrs. Discounted Cash Flow Concept then only will make sense. 10 yrs is too long a time, we may be dead. 8.       Key Drivers for MNC: Large variety/basket/portfolio of products. 9.       Challenges for Indian CO.s: MNCs Expertise/Learning Curve/Economies(Both Efficiency & Effectiveness) of Scale & Scope/ ………..For competition Indian Cos need to go Global………..Indian Cos have better customer insights….MNCs have started deputing resources in India and this is going to be a challenge for Indian Cos….Indian Cos need to be agile and have to be more cost effective. 10.   MNCs are attacking NICHES……OR buying Indian Cos 11.   Indian Cos need to scale up if they wish to survive 12.   If Indian Cos need to attack US consumer or western Europe..Need a big marketing budget…….Not possible rite now…….20 yrs down the line may be a different story. 13.   Growing scale is essential to fuel Global Ambitions 14.   Japanese Strategy: Low Cost…Competitive Home Market…Pushing them to be innovative…Prime Mover in Differentiating Technologies which have a world-wide acceptance. 15.   Suggestion for Going Global: Go in Emerging Markets….Build Up Scale 16.   Brands Emerge Out Of China: Japanese/Korean Strategy Imitating………Developing a World Leading Co…….Ex-Telecom…..Pianos…….Microwaves…Low Cost Strategy n give scale……..Outsourcing to China help them to understand technical know-ho of manufacturing world-class products……Just Imitate. 17.   India Vs China 5 yrs down the line:-   Bullish on both….India has really big Global Players in B2B…We have to go overseas to compete or per say survive in long run…