Marketing Mania series talking to business leaders, marketing gurus, trend setters, experts in different areas of practice and knowledge.

Inspired by CK Prahalad’s book on the “The Fortune at the Bottom of the Pyramid,” Novartis was exploring the possibility of building a sustainable business at the BOP in India. The goal was to create a business that would improve access to healthcare for the poor while being financially profitable, unlike Novartis’s traditional philanthropic and corporate social responsibility approaches. To successfully develop a sustainable business Novartis needed to answer a series of strategic questions: Which BOP patients were the best targets for reaching the social and financial goals of the program? Which diseases should the program cover, and with what types of products (patent protected, generics, OTC)? Which stages of the patient journey should the program address? Which stakeholders should be targeted? What communication channels should be used? What should be the program’s scale? Where to put the social business group in the Novartis organization?

Mrida (Sanskrit for soil), a recently founded social business venture, had launched the Earthspired brand a year ago to sell products made from high-value plants and herbs, which it sourced sustainably from small and marginal farmers in India, to  urban middle class consumers.  This was a key initiative for Mrida, and the founders had big ambitions. They wanted to grow the brand in India and internationally. To address this ambition, Mrida needed to address several interconnected questions: What should the consumer value proposition for Earthspired be and how should it be communicated? What was the most appropriate distribution channel – direct selling, retail, or on-line sales? What should be the business strategy to scale the Earthspired brand, given the limited resources available to a fledgling social business venture?

Peter England, owned by leading menswear firm Aditya Birla Nuvo, has become a household name in India. As we describe in our case study, Peter England became the fastest apparel brand in Indian history to reach 1 billion rupees in sales and one of the most trusted brands in its category by providing aspirational apparel to India’s burgeoning middle class. When it launched in 1997, it focused on positioning its high-quality shirts for young Indian men at the early stages of their career, striving for success.

It was the first apparel brand in Indian history to leverage television advertising. Its messages centred on honesty, international quality and sub-premium pricing to court aspiring consumers who wanted to dress for success but found premium brands too expensive.

But despite meteoric growth, its performance in the second half of the 2000s slowed. Peter England had steadily expanded into new categories, especially premium apparel, under the sub-brand of Peter England Elite and party wear, under Peter England Party, to both cater to consumers who aspired to higher grade, higher priced apparels and those drawn to the emerging clubbing culture. But these extensions didn’t resonate. The brand was deemed by customers to be frivolous, forfeiting its original value of honesty.

This award winning case illustrates the key issues and challenges in creating and sustaining a successful brand in emerging markets. Peter England, India’s largest apparel brand by sales volume, was struggling to formulate a strategy to sustain the brand’s market dominance. Indian consumer tastes were changing rapidly, making it difficult for any brand to stay relevant and fashionable over time. Meanwhile, other domestic brands and foreign players were expanding and evolving rapidly, aiming to dethrone Peter England as the market leader. To devise a new strategy to sustain the brand’s dominance, the executive team has to dissect the forces that are shaping the market and develop a new positioning for the brand, a robust platform that can accommodate its broad portfolio of products and sub-brands. The executive team also has to develop an implementation plan for the brand positioning, entailing product development, advertising, promotions, pricing, and distribution.

The second part of the interview with INSEAD Professor Amitava Chattopadhyay, on the management approach and latest trends of EMNCs defying the common wisdom.
This time the discussion explores what is missing in Japanese companies.