Indian innovation boosts big firms

NEW DELHI: Companies including L'Oréal, Danone and Coca-Cola are exporting products, insights and talent from India to overseas markets, reflecting the country's growing strategic importance to major firms.

L'Oréal, the cosmetics group, has launched numerous bespoke lines in India, like fairness creams and hair dyes, and is assessing their international prospects, said Satyaki Ghosh, its director of consumer products.

"We are now in different stages of moving from few distributors in emerging countries such as the Philippines and Indonesia to several of them similar to how we operate in India, where we have over 750 distributors serving millions of retail outlets," Ghosh told the Economic Times.

Danone, the dairy giant, has accrued this type of knowledge from India in the retail space. Shoppers in the Asian nation typically buy goods at smaller, local outlets, a habit that is on the rise in Europe.

"In Europe, proximity trade is increasing significantly. People don't want to spend two hours for shopping anymore and are starting to buy again from small stores from their neighbourhood," said Eric Soubeiran, Danone's bottom of the-pyramid director. "What we can learn from India by serving efficiently proximity trade can be applied to developed country."

Unilever, the FMCG specialist, unveiled a dedicated Customer Insight and Innovation Centre in India earlier this year, and is seeking to leverage the unit's findings at the wider level.

"On the basis of these learnings, we have created repeatable models and tool kits, which are being taken across to all the relevant markets," said Punit Misra, a vice president at Unilever. "Our effort is to continuously take our repeatable models across as many markets, as quickly as possible."

In demonstration of such a trend working in practice, Cadbury, Kraft's chocolate brand, has rolled out the Visicooler, a low-cost refrigerator provided to small retailers in India, in other fast-growth economies.

"For us, India is a one of the key markets to develop and exchange learnings for the Asia region. India is a diverse market and the learnings from here have high potential to be replicated," said Sunil Taldar, Cadbury India's director, sales and international business.

GlaxoSmithKline, the healthcare group, also recently gathered 250 senior executives from 30 nations in India to understand how its consumer arm operated locally.

"This was done precisely so that GSK's markets globally could experience first-hand GSK India's best practices in driving reach, coverage efficiency and doing consumer activations across fragmented trade [channels]," Zubair Ahmed, the company's managing director in India, said.

The possibilities, however, are not limited to strategy and products. Coca-Cola, the soft drinks expert, runs a training scheme called "Pegasus", which is yielding a new generation of executives with a global outlook.

"There is a direct relation between the Pegasus programme that is focused on grooming tomorrow's leaders and the global talent export," Sameer Wadhawan, its vice president, human resources and services, said.

Data sourced from Economic Times; additional content by Warc staff, 2 October 2012

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