Creating New Markets: A Growth Imperative

Several factors, including identifying potential markets, reviewing challenges and lessons learned, personalisation, premiumisation, localisation, cultural adaptation and ROI, help shape a company’s marketing strategy and determine the decisions brands make to establish their presence.

Impending Markets

When entering new markets, brands must consider various factors, such as target audience, cultural nuances and product-market fit, as Titan Watches does through rigorous research. “This is built from both qualitative and quantitative data on the lifestyle preferences of our target audience, surrogates for discretionary spending, competitive presence and performance, and retail markers of affluence, premiumisation and consumption,” says Ranjani Krishnaswamy, the CMO of Titan Company’s Mainline Analog Watches.

Titan conducts experiments such as consumer events, trunk shows, and partner meetings to gauge the rate of adoption and trial of new products in existing markets or new markets. “The expansion of our jewellery business outside India and our differential approach in the UAE, Singapore and the USA is a fitting example. Each market has its own unique set of must-wins, and our mix is devised, based on the needs of the market. In India, we are seeing a shift towards premium ownership. In the analog watches category, discerning consumers are gravitating towards automatic watches.”

Another India-born brand, Bisleri, started its global footprint in the Middle East last year. “We see the UAE as a great opportunity, with a majority of the water consumption happening through packaged drinking water. The presence of a large Indian diaspora is also an advantage. Consumers know Bisleri as a trustworthy brand,” says Tushar Malhotra, Director of Sales & Marketing, Bisleri.

 “Our ambition is to further grow in the UAE and expand our footprint in other GCC markets that share similar characteristics in terms of demographic construct and consumer behaviour,” adds Malhotra.

 To identify and prioritise potential new markets for product launches, Pooja Baid, Chief Marketing Officer, Versuni India Home Solutions India, follows a six-step system. “We start by conducting market research to assess factors such as market size, growth potential, competition, regulatory environment, cultural considerations and consumer preferences.”

The second step is to analyse data on demographics, economic indicators and industry trends. Thirdly, the brand uses market segmentation to target specific customer segments. The fourth stage would be to prioritise markets based on factors like market attractiveness, accessibility and strategic fit with your product offering and company objectives. The brand, fifthly, considers factors such as market stability, ease of market entry and potential for long-term growth. Lastly, it creates a ranking system or matrix to compare and prioritise markets effectively.

Distribution strategy is key for penetration into urban and rural markets, and Ferrero has an aggressive Route-to-Market plan that has direct coverage of towns.

Taking into consideration India’s tropical conditions, the packaging, route to market, and infrastructure for the trade ensure that Ferrero delivers freshness and quality products at the endpoint of consumption.

At Good Glamm Group, identifying and prioritising new markets for product launches involves a data-driven approach that incorporates market insights and keeps up with the latest skincare and makeup trends.

Sukhleen Aneja, CEO, Good Brands Co., Good Glamm Group, says, “In the case of the introduction of the MyGlamm Super Serum-infused makeup range, catering to multifaceted ‘Super Women’, we leverage our extensive consumer database to identify regions with untapped potential, such as Tier II and III cities in India. 

As we expand internationally into markets such as the United States, the Middle East, and Southeast Asia, we focus on regions that share our brand values and have a high demand for premium beauty products. Our goal is to grow our portfolio brands by 200 percent over the next three years, cementing our position as a global leader in the beauty industry.”

Challenges and Learnings

In today’s dynamic world, businesses must strike a balance between market consistency and adapting their brand to local contexts. Understanding the nuances of each market and tailoring branding elements to reflect local values promotes greater brand loyalty. Maintaining consistency reinforces a unified image and core values, but adapting to local circumstances is also critical.

Zoher Kapuswala, Marketing Head (Ferrero Rocher, Nutella, and Tic Tac), Ferrero India, outlines, “We are a global company with unique and mega brands. The biggest challenge is being relevant to local consumers. India and the other Southeast Asian markets also pose a challenge due to the fragmented retail structure.

“For the trade, we use small, pre-packed display units. We also saw an opportunity in ‘everyday gifting’ for birthdays, anniversaries, and other smaller events. Indian consumers love Ferrero Rocher, and to cater to the trade, we deployed Visicooler, which will help in maintaining the integrity of this delicate product. Using spreads is a habit in India, and we used the same consumer behaviour in our communication for Nutella,” he says.

Setting foot into new markets utilising a strategic approach, Pooja Baid, Chief Marketing Officer, Versuni India Home Solutions India, underlines that she first analyses market trends, cultural nuances and regulatory frameworks unique to each region. “Then, I customise products or services to meet local preferences and compliance standards. Building strong partnerships with local businesses and leveraging technology for efficient operations are key strategies. Continuous market research and customer feedback help in adapting strategies swiftly. Lastly, I focus on talent acquisition and training to ensure a skilled workforce, capable of navigating diverse market landscapes. Flexibility, adaptability, and a customer-centric mindset are the cornerstones of my expansion strategy.”

Her biggest learning with expansion across new markets has been to start by knowing that what works in one market might or might not work in another. Hence, there needs to be a tailor-made approach during expansion.

Aneja talks about employing an approach rooted in resilience, adaptability and innovation. She says, “One of our key strategies involves leveraging our content-commerce strategy, which integrates our in-house assets such as Good Media Co. and Good Creator Co. This approach allows us to effectively reach and engage with our target audience while minimising customer acquisition costs (CAC) and optimising our customer acquisition model. By maintaining a focus on innovation and customer-centricity, we have successfully overcome obstacles and ensured the continued success of our brands in new markets.”

Ready To Adapt

The rise in purchasing power among Indian consumers has resulted in changes in product and brand sales, with personalised and localised approaches that take cultural nuances into account. Ferrero focuses on aesthetic packaging and product identity, such as Ferrero Rocher’s distinctive round shape and golden wrapping resembling a golden laddoo, which appeal to consumers beyond metropolitan areas. The use of gold, which is considered auspicious and associated with prosperity, is also used to premiumise the range.

 Ferrero uses the characterisation of its packaging during all the local festivals like Diwali, Holi and Valentine’s Day to be more relevant to the Indian consumer. Kapuswala further says, “The brand capitalises on seasonal events and topical days like World Chocolate Day to increase customer engagement and sales. During celebrations, we leverage our product selections as perfect gift options, thereby capitalising on’moment marketing’. Moreover, we understand the impact endorsers and influencers have on our target audience, thereby amplifying its reach. In the coming months, we look forward to leveraging our endorsers and social media influencers during various relevant occasions.”

Adding to what Kapuswala already stressed, Baid mentions that emphasising premium features, craftsmanship, sustainability or exclusivity to differentiate your brand from competitors is a way to make one’s brand stand out.

“Our portfolio of brands is strategically designed to cater to the diverse needs of individuals across different stages of life, incorporating personalisation, premiumisation, localisation, and adaptation to cultural differences in our product offerings and marketing strategies,” she adds.

Mapping Success and ROI

The level of success and ROI that brands can achieve is a major factor in determining what they choose to do (and what they do not do).

Like most brands do, Krishnaswamy points out that Titan measures the effectiveness and Return on Investment (ROI) of its market expansion efforts by studying several key metrics. “Firstly, we track the gain in market share across catchment areas, towns, states and the country. This helps us understand our penetration and growth in new markets. Monitoring the percentage of repeat customers and the Net Promoter Score helps us evaluate customer satisfaction and loyalty. These serve as crucial indicators of brand awareness and overall success. Furthermore, we analyse stock turns, portfolio mix and return on advertising spend to build a holistic evaluation of our merchandise and marketing campaigns.”

Central to Good Brands Co’s strategy is its content-commerce model, which enables direct engagement with customers on its DTC platforms. Aneja adds, “We gauge the effectiveness of our market expansion initiatives by tracking key metrics such as the acquisition of new customers, transacted customers, and loyalty programme members.”

She gives the example of their dot-com platform, where they have over 15 million transacted customers and 25 million loyalty programme members, which contribute significantly to their revenue.