Introduction Till just a few years ago, a low-cost but reliable courier service, namely Professional Couriers, offered to deliver small packets for just Rs15/- for any packet up to one hundred grams. Their deliveries to off best locations through the postal network took one day more. Professional Couriers worked on the bulk delivery model, innovating by making deep inroads into the market already served by Indian post offices. To this day, though it has revised it's charges, the brand continues to dominate most cities in South India. It now has new competitors like the ST courier service but has managed to survive on its own strengths.
What made the difference? Extremely simple. It just milked an established market by offering customers a good choice. It had its own pick-up facilities from houses even in remote locations. The likes of Professional Couriers, have, in the main a) Offered value-additions at low-cost b) Have differentiated on price and quality of service/product c) Continuously innovated to stay alive d) Made deep impact on minds of customers and e) Continue high-decibel advertising to maintain market share.
Offered value-additions at low cost Unlike their counterparts in the North of India, ladies in Tamil Nadu and Kerala always prefer shampoos made of natural compositions, where the chemicals are kept to the bare minimum or are even zero. After keenly researching these markets, Cavinkare, a Chennai-based formidable player in the FMCG market that has always dared to take on the market-leaders like Hindustan Lever and P&G, came out with a herbal shampoo called Meera. Over the years, Meera has grown into a big brand and has millions of customers who buy the product and no other. The brand is a good niche. It has launched brand extensions and has been able to do well.
Haldirams is a major player in the Indian 3 PM snack market as it has been able to understand the Indian taste buds. The need for snacks with tea is part of Indian culture. It is found everywhere. Haldirams has milked the market. Cut to those who offer ready-to-eat foods like the chapatis and even parathas in many mini-supermarkets in the metros. This was one market waiting to happen. The felt need can be traced to the lack of time of millions of working women. When the value-addition happens, there is no looking back.
Have differentiated on price and quality of service/product Sterling Resorts has distinguished itself in the resort business through superior quality service. It has a big niche and is a favorite destination for those keen on a nice honeymoon. Each service offering is unique and the organization has been able to make a good impact on the market only because it's packaging and service delivery are different.
Tata Glucoplus is the drink of the common man. It has made the product available at just Rs10/- in a very attractive pack. The product has caught the imagination of those who wanted a cheaper drink when compared to the Pepsi and Coca Cola offerings. Anything that is perceived as a+ Value for money product is bound to be a good success in a clear "either-or" market where customers look to beat the summer heat and their thirst at reasonable prices. According to trade sources, Tata Glucoplus is a fast-selling product in the cooldrink segment. This is a classic example of a low-cost warrior taking up the challenge of being present in tough premium markets where there are many established players.
Goodnight mosquito repeller is the market leader as it comes from Godrej. It has been able to maintain it's quality and is a top-of-the-mind recall product as its advertisements feature a naughty boy and his infant sibling. When a product lives up to its promise, it will be a sure success. Similarly, NIIT was able to offer quality training at a reasonable cost and emerge successful in a market that was and is still flooded with a number of half-baked players who survive with faculty drawn on a part-time basis from IT companies. Hence, wherever the differentiator is good and the product or service is largely accepted by hundreds of thousands of customers, any player can sustain in the Indian market.
Continuously innovated to stay alive The mini-supermarkets in Chennai have to compete with the likes of Big Bazaar. They keep on innovating to serve the customer better. Many have home delivery arrangements and are keen to forge personal relationships with each family in all gated communities. This works to their advantage, more so, when they start pricing their goods at rates similar to that of Big Bazaar.
The private Omnibus operators in many parts of Tamil Nadu have regular customers among business people who like to travel by the AC sleeper buses at the last minute. They would decide the trip just around forty minutes in advance and give a call to the service operator. Apart from some discount on fares, these buses even arrange to pick up those particular customers from special stops en route. All this is quietly done as they do face competition from the State Government buses. The traffic and business to Chennai are extremely good on all days in a year. However, the intelligent innovations in service and personalized equations with customers do help the particular business grow from strength to strength. Similarly, the Tejas expresses have succeeded in drawing away thousands of customers who travel by the private buses during day time on urgent trips or for personal purposes such as attending a wedding. The Tejas Express between Madurai and Chennai has seen a big increase in customers in recent times, due to the superior comforts in the train.
Made a deep impact on minds of customers Around 1 p.m. or even at 12.30 p.m. every afternoon, hundreds of customers will make it to Station Road on the West Mambalam side. This is a fully developed residential area but thickly populated as well. Nevertheless, one eatery like the Kameswari Mess will simply come alive. Hundreds of regular customers go there to eat the different variety of meals available there for Rs 35/ apiece. The offerings include the curd rice of the sambar rice or the brinjal rice and a few other varieties, served every day. Many take the parcels too. What is important is the space that this small restaurant has made in the minds of hundreds of customers. There are hundreds of repeat customers and since there are so men who have a business in that part of Chennai city, the business keeps growing from strength to strength. It should be noted that for a similar quantity and quality of food, one would have to spend at least Rs150/- in the branded vegetarian hotels nearby. That the mess caters to the mass market is very much obvious.
This example has been quoted to bring home an important point. The size of the business is not important. What is extremely important is the intent to really serve the customers and when this is a passion among the entrepreneurs, everything else falls into place. Havells has made deep inroads into markets not so long ago, dominated by the likes of Usha, Crompton Greaves, and Philips, particularly in the ceiling fans business.
Continue high-decibel advertising to maintain market-share Hamam is reportedly the largest selling soap across all categories of toilet soaps. Ditto for Dettol which is a nice product but goes on advertising to maintain it's market shares.
Asian Paints is another glorious example. Its current campaign of "lamination for the entire house" is a big success. Smaller brands like Bovonto and a South-specific soap that has both the toilet and detergent variants under the brand of Power soap also go on advertising their product. Bru is another example.
The fierce competition for market share among the two leading players - Reliance Fresh and Big Bazaar does not need any big explanation in the organized retail market. Reliance is itself a new competitor in a crowded market that also includes mini supermarkets and online competitors like Flipkart and Amazon. Yet, Reliance has grown because of its deep pockets. It is yet to be seen how Reliance can manage its huge debt, though.
ConclusionGiven the complexities in every market, the aforesaid examples and methods will explain how the competition pans out in different markets. Since the markets are themselves intensely competitive, it remains to be seen what shape the battles take in the next few years. That is a big lesson, details of which will unfold in the next decade.