India as a blueprint for emerging markets
I was in Manila last month, and I found so many parallels to India. The railway infrastructure and the long lines reminded me of Mumbai, the narrow bylanes took me to Ahmedabad and the immovable traffic outsourced me to Bangalore.
My experience reminded me of two of my favorite business books that I had read in recent times. The first one is called Blue Ocean Strategy, where the authors encourage businesses to create new market spaces and hence create new demands, rather than competing in a crowded market space. The second one is called Conquering the Chaos — Win in India, Win Everywhere, where the author thinks that if you can build a product or a solution to solve a very Indian problem, you can easily replicate the same in other emerging markets. This is partly because India is a relatively mature emerging market, and partly because other emerging markets can resonate with problems in India.
This led me thinking whether I can find examples of successful Blue Ocean implementations in India, which can serve as an inspiration for other emerging markets. The problem with this approach is that almost every internet company might seem like a blue ocean, where companies such as Flipkart, Swiggy, Ola all created new markets, and created new demand. The conundrum is that these are not original ideas, but at the same time they have a massive market share. Sometimes success is not about technology or innovation, it’s about operational excellence or hyper local solutions. Cash on Delivery being a classical example of it, where I don’t think that a Flipkart or an Ola can be what they are today if they operated only on digital credit.
For this article, I did a limited research (AKA quick Google Search) and picked companies from different sectors. My criteria was to search for companies which a) started in India b) were not replicas c) started by solving an India specific problem and d) have a significant market share. This list is not exhaustive by any chance, and there’s definitely a bias in my limited analysis.
Oyo initially started as a hotel aggregator, but quickly pivoted into leasing and rebranding cheap hotels. Their competition was not three/four/five star hotels but a large unorganized market of individual hotel owners and travel agents. Users could book hotels online, which added reliability and removed complexities of dealing with agents. Moreover standardization ensured that a customer’s basic needs would be taken care of.
2. Udaan
Started by Flipkart employees, Udaan set out to tap yet another unorganized sector. It is a B2B ecommerce platform, where businesses can buy goods in wholesale and on credit. Businesses now have a large catalogue to choose the best product, instead of relying on local vendors. An average Indian business owner might not be very tech savy or English literate. Udaan succeeded by talking to their customers and being hyper local by assisting them in transactions, reducing commissions, helping in logistics and even providing credit for transactions. This ensured that it had a reliable and continuous source of revenue.
3. Shuttl
Two major tech hubs — Noida and Gurgaon, surround the Delhi National Capital Region. The IT parks are a bit far from the Delhi metro stations, and it is not very safe to use public transportation in the night, especially for women. A lot of office goers wanted a reliable, safe and cheap form of transportation to ferry them from their offices to the metro stations, and Shuttl jumped right into the opportunity. It’s not competing with the on-demand ride sharing companies, but is just concentrating on the office going market segment. Moreover it has forged partnerships with different corporates, hence creating a steady revenue stream.
4. FabIndia
A retail entrant on this list, FabIndia is not a new brand. Started in 1960 by John Bissel, it set out on a mission to provide chic ethnic clothes made by rural artisans across the country. It not only had a social good mission to support rural artisans, but it disrupted the informal sector by building a reliable supply chain. It also created a niche for itself by selling ready made clothes, rather than competing with the local shop owner who would buy clothes in wholesale and stitch them.
5. Shaadi.com
It’s a saying that Indians don’t date, but they marry. As Indians started working abroad, finding educated partners started becoming more and more difficult, and hence started the concept of matrimonial websites. But, these websites are still very popular even today, despite alternatives, and that is because the alternatives don’t cater to the unique constraints of the Indian youth. The market leader shaadi.com, enjoys a wide network effect and that means that an average Indian youth is much more likely to join the shaadi.com, than anything else.
I think the problems that these companies are trying to solve, easily correlate with problems that other emerging markets are facing. Thoughts?
