1. Analysis of Indian
Industries
Prof. Ashwin Malshe
Marketing Department – ESSEC

2. Agenda
• Study four Indian industries
• Luxury
• Pharmaceutical
• Cosmetics
• Processed food
• Mobile banking (if time permits)
• Case study on HUL Pureit water purifier

3. Source of Data
• Most figures in this presentations are taken from
multiple sources. A primary source has been
industry reports published by consulting firms. I
attribute data to the sources wherever applicable.

4. Luxury Market
• Indian luxury market size - $5.7 billion in 2010
• Growth at estimated 20% per year
• By 2015, the market size will be close to $15 billion
• Six cities dominate –
Delhi, Mumbai, Bangalore, Chennai, Hyderabad, an
d Pune
• Traditional ‘low margin, high volume’ model is
restrictive for luxury penetration
• Presence of multiple brands
• Hermes, Paul & Shark, Diesel, Canali, Tumi, Aston
Martin, Ferrari, Harley
Davidson, Ducati, Kiehl’s, L'Occitane, Hakkasan, etc.
Source – AT Kearney

5. Luxury
• Indian consumer
• Many Indians became rich recently (post 1990)
• The typical luxury customer may be labeled ‘Parvenu’
• Wants to associate with other ‘haves’ and wants to
disassociate from ‘have-nots.’ Uses loud signals
• Price sensitivity remains high
• Mercedes diesel sells much more than petrol version
• Discounts are considered as entitlements by the
Parvenus.

6. Luxury
• Trademark laws
• Counterfeits are common
• Less than China, however
• Poseurs are more likely to use them
• PC Mallappa vs McDonald’s case
• Delay in courts
• Sales culture
• Incentives are variable in most cases
• High fixed as well as variable pay

7. Hermes India

8. Hermes Saris
• Priced at $6,100 to $8,400 (€4,700 - €6,500)
• Limited edition

9. Hermes India

10. Hermes India
• 3 outlets: Delhi, Pune, and Mumbai
• Low advertising budgets
• No difference in product or store design as
compared to Paris
• Excellent sales staff

11. Pharmaceuticals

12. Indian Market
• Indian pharma market size was $11.6 billion in 2009
and growing at average rate of 14% annually
• $20 billion by 2015
• Currently ranks between 10-14 in the world by size
• Produces simple headache pills to sophisticated
antibiotics
• Almost every type of medicine is now made in India
• 250 large companies control 70% market
McKinsey and Corporate Catalyst India

13. Nature of Pharma Industry
• From 1970 to 2005, Indian law recognized only
‘process patents’ and not ‘product patent’
• Many Indian companies started producing top notch
drugs by changing process
• This stopped with WTO adoption in 2005
• Strong R&D base and low labor cost
• Reaching the consumer through physicians
• Direct to consumer advertising is relatively low

14. Emerging Trends
• Global pharma companies are investing directly in
India
• Latest regulatory changes have created some
challenges
• Contract R&D
• Drug discovery and development
• Clinical trial organization
• Contract manufacturing
• Contract co-marketing alliances

15. Beauty Care

16. Indian Market
3,000.0
2,500.0
2,000.0
1,500.0
2011
2012
1,000.0
2013
500.0
0.0
Hair Bath Skin Oral Men's
Care and Care Care Grooming
Shower

17. Whitening Cream
• Largest selling beauty product in India
• Women
• Commercial
• Pond’s series
• Men
• Commercial

18. al India
• Entered India in 1993
• Presence in 100 top cities and towns
• Four divisions
• Consumer products (Garnier)
• Professional products
• Active cosmetics (Vichy)
• Luxury (Lancôme)
• Own manufacturing in Pune for hair and skin care

19. al India
Value Share Rank
Beauty and personal
care 3.50% 6
Color cosmetics 13% 3
Hair care 8% 4
Skin care 6.50% 2
Men's grooming 0.90% 14

20. Processed Food
• Mumbai Dabbawalas

21. Indian Market
10.0
9.0
8.0
7.0
6.0
5.0
4.0
3.0
2.0
1.0 2010
0.0
2011
2012

22. Packaged Wheat Flour
• Pillsbury