Innovation within emerging markets

The Hindu

More than the analysis, which is based heavily on fundamentals such as distribution networks in India’s vast hinterlands, what caught my eye were the stories about the TTK company’s innovations centered around their Prestige brand of pressure cookers. Now, they just need to redesign the pressure cooker itself. I own two Hawkins pressure cookers because it has been passed down to me that their infitting lid design is safer than the over the top fit of the Prestige. Exploding pressure cookers are a common horror story.

Still, I digress, back to TTK’s overhaul and revenue growth for Prestige – the biggest change they made, in the Indian context, was creating a franchise chain of showrooms for their products under the "Prestige Smart Kitchen" brandname. Apparently their sales are up in the double digits, the showrooms are affordable entreprenuerial ventures in the smallest towns and even NGO’s have got into the act in the absolutely rural areas.

Singer India was a long term exhibit design client of mine, through one design studio or the other over 6 years, and we’d got to know their Delhi dealers and distributor well. Most of these products are really truly available in the worst locations, in horrible dusty and dirty shops with little knowledge of display. TTK did take a risk, as the article exults, and to great success, when you consider the biggest hurdle, even in India, is how to penetrate the great rural market. While urban India has a 94% percent penetration of pressure cookers, rural India has only 22%. Guess which population segment is larger?

The bottomline seems to be the customer experience, great to see it in contexts other than just the latest MP3 player and the box it came in. Here’s a snippet,

Brand managers suffer from a couple of maladies. One is the
unshakeable belief that their product is the best thing that has ever
happened to the human race. The second is the secure belief that they
know everything that needs to be known about their consumer. And yet,
as a general rule not enough on-going research happens to map changes
in consumer’s expectations and experiences with their respective
products.

Even less research takes place to understand the feelings of
the consumer at the dealer outlet. Research done at the pressure cooker
outlets suggested that the outlet was hardly anything to write about.
The display was unappetising, at best. The dealer’s salesman was often
untrained and not infrequently, unfriendly. Transactions tended to be
conducted without bills and prices varied, leading customers to believe
that dealers lacked transparency. Hardly surprising that even though
the consumer had the money, she did not have the desire to browse at
the dowdy outlet. In fact, the category’s share of the consumer’s
wallet was shrinking.

What’s really interesting is that while a certain percentage of customers browsed the showroom but ended up haggling with the dealer’s outlets for the product, there were just as many purchased at the full retail price from the showroom floor. Both the franchisees and the dealers were happy.