Big Companies, Slow Moves

A couple of days ago, I came across some promotion for this new product from the Unilever stable, the Taj Mahal dessert teas. Since I was already walking out of the supermarket, I couldn’t go back in to check it out, but it set me thinking on why do big companies often enter new markets late?

Premium teas and flavored teas, have in the last couple of years, really picked up in the Indian market. I don’t really have any data to back this up, but the sheer variety that is available and the shelf space that is being dedicated to such teas, surely is some evidence. And this is happening not just at premium outlets or really large stores, but even at neighbourhood family run supermarkets. So there has to be a reasonable level of demand happening.

But Hindustan Lever (or Hindustan Unilever, as they are called now), one of the largest brand-owners in the Indian tea market, has really not set foot in this market, or not to a great extent. I recall seeing some cardamom and such flavours from them, but the exciting new flavours are all really being brought out by other brands. Earl Grey, Chamomile, Orange Blossom, Vanilla, Mint, English Breakfast – you name the flavour, and its available on Indian shelves now. The brands are usually Tetley, or Sri Lankan teas like Dilmah. The strange thing is none of these brands really had any significant presence in India until five years ago, and now they are the face of premium tea, while HLL which owned the tea category, keeps touting the same old Taj Mahal as its premium brand.

Which brings me back to my question – why do big companies often enter new markets late?

I think their very size handicaps them when they look at new markets. For a Rs. 1000 million sized brand, an opportunity that is Rs. 10 million worth, seems very small. The brand waits, and waits, until the opportunity becomes worthwhile. In the meanwhile, smaller brands with smaller ambitions start developing the market. Conventional marketing wisdom infact accepts this as a viable strategy where a big brand enters a market once it has grown to a certain size, and then proceeds to chew it up on account of sheer size and financial and distribution muscle. It could work; On the other hand, smaller brands do sometimes acquire a certain image especially in premium categories, and a late entrant could end up with some lost opportunities.

Any thoughts on this?

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How does your company Interview – Part II

A long time ago, I did this post on how some companies interview people and the various biases they bring with them. Now Bombay Dosti has this interesting rejoinder from the other side of the table, and why some of those very practices may be valid in the Indian context. I don’t agree with all that she says, but she does make a mean argument, so go read!

Theory and Reality

Pamela Slim, of Escape from Cubicle Nation, has this lovely post on Theory versus Reality, and while she talks about it in the context of business, really, it can apply to just about any aspect of life. How often do we get into something with an idealized version of what it would be like, and then jump in headlong, only to start the firefighting right away. Sometimes, its idealism, sometimes its just wanting something so hard that we imagine it exists! Even veterans can’t help committing these mistakes, but ofcourse, we can try to deal with them better!

Effective Presentation

I know I linked to Rowan Manahan’s Blog quite recently, but there is just so much good stuff out there! If you are in any line of work that requires you to use powerpoint, check out this most useful presentation he has, on how to, and how not to use powerpoint.

Today its not just us management types who make presentations. Students use powerpoint, so do academics, and people in all sorts of industries. With greater use comes more misuse. I certainly do my fair share of mistakes on presentations, not being a very visual person. Its fantastic to see the kind of genuine help of this sort that one can find online!

The presentation is 128 slides long, but no way does it feel like that. Well worth a thorough read…And now to see if I can apply some of those principles in my work.

Corporate Blogging in India

I was interested in seeing whether companies in India have begun to use blogs as a means of communication with different audiences, and I did some digging around to see who is doing what. Surprise, surprise! I just can’t find too many corporate blogs in the first place. (Or my googling skills are poor!).

The usual culprits, which have been much talked about before, came to light again. First, the Infosys Blog, Think Flat. Now they have put together a star blogger team, with senior members from communication, marketing, sourcing, consulting etc besides Nandan Nilekani himself. But one odd thing about the blog is, that perhaps because of a number of contributers adding pieces whenever their schedule permits, the blog is very erratically updated. Sometimes articles follow each other after a day, and sometimes there are no posts for a week or ten days. I think regular updation is critical for a serious blog. Another surprising thing is that at the end of a page, there is no link pointing to ‘older posts’. One has to trudge through the archives. Perhaps they need someone who understands blogging and can help this senior team out by coordinating posts and having a more user friendly design. However, the content on the blog is quite good – while it touches briefly on Infy’s expertise, it doesn’t hardsell in any way, and in most cases, is quite interesting to read, though not phenomenally.

Then, there is Fritolay India’s blog, maintained by Madhu Rajesh and Abhijit Bhaduri from their HR function. This is really more of a fun, informal blog, and as such, the regular aims of ‘corporate blogging’ may not apply. However, I think they do a good job of presenting Fritolay as a young, vibrant place to work in. Definitely, if prospective employees came upon the blog, they would find it interesting and appealing. Again, the frequency of blogging is not consistent. I am not sure if they are thinking of this also as a means to keep current employees updated or whether they have a separate intranet/blog for that. But if they do want to keep current employees involved as well, then it may be a good idea to update more often.

I also came upon Tata Interactive’s blog, which is a mix of general interest article as well as those focused upon design and technology related issues. This one seems to be updated quite often, and also has a mix of regular writers plus guest writers. I suppose this helps them keep things in control, since the core blogging team must be monitoring content, ensuring updation and a good mix of subjects. Another notable thing about this blog is that many of the posts have atleast a few comments on them, something absent from the other two.

In the case of the Infosys blog especially, I got the feeling that they were operating in isolation. There was little dialogue with other technology blogs, few links to other bloggers – the posts aren’t really very different from what a website or maybe online journal might have. They don’t seem to be really blogging in that sense, since one of the most powerful things about blogging is the conversations and relationships it can build. So does it really help to maintain a blog if you can’t be active in the related blogging community?

Some of the lesser known ones – Giftex – a company that I’ve never heard about, but has a blog with quite good content on its area of operation, gifting. Score India, a sports development/promotion company that has a corporate blog that sort of goes all over the place and stopped running after October 2006. I am not sure what book launches are doing in there, except for the one on the Commonwealth games. And the formatting is terrible. Tekriti Software’s blog too has not been updated after November 2006, though the content was good, while it lasted!

Does your company have a blog? Let me know if you’ve come across any others that I may have missed out.

Entrepreneur Watch – Language Solutions

Here comes the July installment of the Entrepreneur Watch! I hope to profile atleast one business a month from now on, so watch out for more interesting material. This month, I have on interview, Anurag Goel, Founder of Cactus Communications. Founded by Anurag and Abhishek Goel, Cactus is a company that started off providing English editing solutions for the Japanese market, and has now expanded into related areas as well. Prior to starting their own company, Anurag worked with McKinsey & Co. while Abhishek spent time in Tokyo as an in-house consultant for AIESEC, an experience that proved to have major consequences! I know Anurag briefly and was always intrigued to know more about a business that targeted a seemingly impenetrable market, Japan. So here we go…

To start with, it would be good to know a little about Cactus Communications. How old is it? How did the idea for the company originate?

Cactus started of as “Editage” in April 2002 and was officially formed in October 2002. So it has been about 5 years. The seed was laid when a friend of Abhishek’s (a researcher in Japan) asked him to edit a paper as a personal favor. The favor was done and incident promptly forgotten. Two years later when we were brainstorming on what businesses to enter, this came up as an idea again. And then we took it forward.

What would you say is the crux of the service that you offer?

We focus on providing English solutions of the highest quality. This spans English editing, writing, education and training.

Did you face any troubles starting up? How did you find your first clients?

The first 1.5 years were very difficult. We had identified a niche but we did not know how large the niche was. So there was always this nagging fear that we may be too specialized and is the market large enough.

Our first client was a friend of Abhishek’s. He introduced us to a few more clients. After this there were some very difficult business trips to Japan where we tried to convince people to give us work. All we had at that time was an office in an industrial estate, with 3 employees — we needed to create enough trust and credibility for clients to look beyond this obvious problem.

We learnt a lot from our first few clients and they have been invaluable in supporting us as we have grown.

Why was credibility an issue?

Credibility was an issue, especially in the initial stages. First, because we were a start-up and were trying to sell high value added professional services. Second, because we were based in India. The India-story in 2002-3 had not yet become an accepted one globally, especially not in Japan. And we were at a disadvantage in any new client discussion as we had to first explain why getting high quality English services from us was possible.

Tell us more about the journey – how has the company grown? The challenges that you face now – how are they different from what you faced while starting up?

Hmm… this is a big question. The first 2-3 years were very exciting and heady. It was about building and creating something from scratch. One was involved in all the action at the operational level and you could see immediate impact for your efforts. A lot of passion and self belief, some fear and a lot of perseverance.

Now the challenges are very different. We are about 140 people. The problem I find most interesting and difficult to fix is that of organizational design. How do you create something that can work as fast as a start-up and still grow sustainably?

The fact that our business model is largely retail (most of our clients are individuals) – makes it more complex to manage the growth. So, the challenges now are about managing growth so that we don’t lose the excitement from the initial days, we maintain performance levels and create a stable platform and system for the future.

Tell us a little about the market that you service. Traditionally most outsourcing firms in India look west, while you’ve gone East. How is this market different, what are its peculiarities?

Our primary market is Japan, which accounts for 80-85% of our business. In the last one year we have also made inroads into Korea and Taiwan. The market is more difficult to penetrate because of huge language barriers and cultural differences. So complete localization is very important for success – and that is difficult to execute as a foreign company. What I like about the market is that it is not as purely transaction oriented as in the U.S. — where usually the most important factor is price. The East allows one to build relationships and that makes for a more satisfying business experience.

How competitive a market is this? Whom are you up against and what is your edge to compete?

The market is quite competitive locally. There are established players, typically American or Japanese companies, servicing the education and the editing market. Our edge? I think we try to bring a higher quality to the service levels and we innovate. In editing, our more established service, we are market leaders in bringing better value to clients. Competition is usually imitating us!

What next? How do you plan to grow?

As I mention in one of the earlier questions, new markets is something we are already considering actively. Korea and Taiwan are the main focus this year. Next year will be mainland China. We are actively scouting for opportunities in medical writing which will be our first concentrated attempt to tap into the US market. We are also looking at providing written English training to select Indian clients this year. A lot of things happening – too many actually.

For yourself, moving from a consulting firm to your own business, what was the toughest challenge about making the transition?

It wasn’t really that difficult since it was a thought-out decision. I knew it was a risk and nothing might come off the decision. There were, and still are, periods of insecurity. The one thing that surprised me was how difficult it is to execute well, consistently. The reason this was a surprise was not because it was difficult — since I had already known and expected this– but because I had grossly underestimated its degree.

If you were doing it all over again, what mistakes of setting up would you avoid? What would you do differently?

Hmm… I can’t think of an appropriate answer to this question. I think we are making mistakes every day which we learn from and correct. And I don’t think we have reached that level yet where I can look back and say — we could have grown faster or would have been better if I had not done this or that. I think we need to achieve a lot more, grow to a larger, more sustainable level. I will probably then have the perspective to address this question.

Well, I hope that was an interesting read. I definitely enjoyed the whole process of writing up about it, since this is a business that has now seen a few years and is facing different challenges from what a start-up would. Interesting, therefore, in a completely different way.

For those who haven’t seen it, the first post in the Entrepreneur Watch series is here. And, if you see an interesting business that you think should be featured here, do write to me at aputhebird AT yahoo DOT com

Indiaplaza’s Deathly Service

Harry Potter and the Deathly Hallows. Don’t worry – this is not another review with a spoiler, since I haven’t read it yet. This is a post on Indiaplaza which offered the book at a throwaway price, and now proudly proclaims that it has already delivered 15000 copies since the release 3 days ago.

Well, I don’t know how well they are managing to supply all the Harry Potter orders that they’ve received, since my order for some other books, placed on July 5th is still pending, with no response from their customer service either. Let me begin the story from where it actually starts.

On July 5th, I placed an order for 3 books, Thomas Mann’s Magic Mountain, Ambai’s Purple Sea, and Azar Nafisi’s Reading Lolita in Teheran. Ofcourse the standard delivery time was listed as 3 to 4 working days. Till July 11th, the status on the website, kept showing up as ‘Ready to Ship’, upon which I fired off a mail.

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I got a response immediately that there was some delay and the order would be shipped out by the 14th. Fair enough, I thought, a few days delay on account of some unforeseen problem was not such a big deal.

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Just a few minutes later though, I got another mail that one of the books I had ordered, Reading Lolita in Teheran was not available, and my money for that would be refunded.

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I was a little annoyed and wrote back to them, that this should have reflected on their site. But still. It wasn’t such a big deal.

Then. The 14th went past. And the 15th and 16th. And the shipping status on the site remained unchanged. So I wrote in again, asking for my books. I received a reply from the customer service team, that both titles had been shipped out on the 16th and I was receiving them on the 17th.

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Sure enough, I received a parcel on the 17th. With only the Magic Mountain, no sign of Ambai’s Purple Sea. And. Including a statement inside that both books had been delivered. By now, I was getting quite irritated. The fact that my neighbour had picked up the parcel in my absence, meant that I couldn’t even open it in front of the courier and check. So I wrote back a slightly snarky mail, asking why I was being cheated.

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Not just the goof-ups, it is practically impossible to speak to a customer service person. There is one line, which is perenially engaged. So instead, I asked for a senior manager’s number whom I could speak to. Ofcourse I got a standard response, although it acknowledged that the second book was missing, and promising to revert in 2 working days.

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No such luck ofcourse. So. I wrote again. If this sounds tedious to read, imagine my plight!

Again, a request for more time.

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By now, I had come to the end of my patience, so I replied that I could not waste more time, and asked for a refund on the missing book. That was on saturday, the 21st.

Till date, though I have followed up on this twice, including mentioning that I am considering going to the consumer court to get back my money, Indiaplaza hasn’t bothered to answer. Honestly speaking, I don’t have the time or the energy to actually do anything about it. Infact, I think my money is sort of written off.

Harry Potter fans who have placed their orders on Indiaplaza – if you haven’t already got your copy, you know what to expect, don’t you?