NRI Papers
No. 169 January 1, 2012
  A New Phase in India's Consumer Market and Japanese Companies' Strategies for Emerging Markets  
Yoshihiko IWADARE

After China, India is recognized as being a rapidly growing emerging market. However, when we look at the efforts of Japanese companies, we find that many are struggling without being able to achieve expected levels of revenue growth.

While many Japanese companies have adopted a strategy of selling high-end products to the affluent segments in major cities, the customer base, the regions and product positioning that they target may not necessarily match the reality of the markets in India.

Among wealthy Indian consumers, some have traditional values while others have values that are more modern. From the perspective of geographical distribution of wealth, it is necessary to consider the improved purchasing power of people in rural areas and farming villages.

Even in the face of intense competition involving Indian, European, U.S., South Korean and Chinese enterprises, it remains possible to find business opportunities by drawing up and steadily implementing strategies targeting precisely selected consumers.

The emerging markets that are expected to achieve remarkable growth in the future are geographically far from Japan and are generally unfamiliar or unknown to Japanese companies. These markets are expected to be the places of all-out competition among market participants. Whether achieving success in the Indian market will be an important step as a touchstone for setting strategies for other emerging markets in the future.

Contents
I Japanese Companies Face a Wall Hindering Their Growth in India
II Reviewing Strategies--White Space in the Market
III A Fragmented "Affluent" Market
IV Strategic Options Available to Japanese Companies and the Roles of Their Head Offices

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