"Kellogg's set up a branch in India and started producing Corn Flakes to give co

nsumers the real thing. What they didn't realize was that Indians, rather like t
he Chinese, think that to start the day with something cold -- like cold milk on
your cereal -- is a shock to the system," says Bhabha. "And if you pour warm mi
lk on Kellogg's Corn Flakes, they instantly turn into wet paper. In business stu
dies, when you look at a market, you have to know something about its anthropolo
gy and its cultural rituals."
Given how many marketers worship at the altar of brand integrity, the attempt to
protect a product by changing it as little as possible around the world is unde
rstandable. And for some geographic expansions, it may be exactly the right thin
g to do. In India and many other countries, however, transplanting a business fr
om one cultural, economic, and political setting to another requires more.
ON THE RIGHT TRACK. In the last century, many railroad companies nearly drove th
emselves out of business by believing they were in the locomotive industry rathe
r than the transportation business. Today, many big global companies cling so ti
ghtly to their brands as they globalize that they forget what the brands actuall
y stand for in the first place.
Had Kellogg's aimed at winning in the "breakfast" market rather than importing i
ntact the cold cereal category with which it was familiar, the company's full ta
lents could have been focused on creating products that suited the Indian prefer
ence for a hot breakfast.
In 1960, Harvard Business School professor Theodore Levitt chastised the train i
ndustry for not taking off into air travel, and he proposed a fundamentally user
-centered approach to corporate positioning in the face of technological change.
Too many companies, he argued, overvalue their current investments and underval
ue opportunities for growth that are deemed outside the core business -- but whi
ch address more effectively their customers' basic needs.
The problem of taking established brands to success in high-growth markets is qu
ite similar, and it is time to dust off Levitt's framework, turn it ninety degre
es, and return it to service. Whether responding to differences technological or
cultural, the basic lesson remains the same.
In the long run, core competencies can change, but a fundamental focus on the co
nsumer is always essential. It is better -- and easier -- to develop new skills
than to lose your customers.
FREE YOUR BRAND. The best brands are not superficial logos or slogans but organi
sms that robustly and regularly satisfy some fundamental human need. They are bi
gger than the sum of their supply chains and storefronts. Their competitive adva
ntage is in knowing, understanding, empathizing, anticipating, and serving their
customers better than the competition -- not just making more copies of the sam
e.
When considered in this way, Coke ((KO)) is not a sweet, brown cola but cool ref
reshment. McDonald's is fast, clean, and easy for families to enjoy together. Ci
tibank ((CITI)) doesn't just store money but offers trust. Vodafone doesn't sell
GSM technology but connections to friends, family, and business associates.
Pizza Hut's success has increased in direct proportion to its adaptation of its
pizzas to the local palate. According to Alok Lall, general manager of Saatchi &
Saatchi in New Delhi, who managed the account previously at JWT, the company st
ruggled in this market, primarily because the [standard Italian] toppings were c
ompletely alien to Indian taste buds.
"But with the launch of a Tandoori Pizza," says Lall, "the results were amazing
-- store traffic quadrupled. It was a flavor Indians were already comfortable wi
th, and Pizza Hut has since launched many more flavors tuned to Indian tastes. T
oday, Pizza Hut has more than 150 restaurants in India, and the cash registers a
re ringing overtime."
AIR CONDITIONING. Pizza is from Italy, where tagliatelle, not tandoori, is the
native tradition, and Pizza Hut is a thoroughly American creation. Yet both the
dish and the brand were able to thrive in a new setting because Pizza Hut's lead
ers understood that their offering of fast, hot food in a clean, casual setting
could transcend a recipe book.
Sandeep Kohli, managing director for the Indian subcontinent at Yum Brands ((YUM
)), Pizza Hut's parent company, puts it best: "We follow a simple philosophy: Pi
zza Hut is an international brand, but it has an Indian heart."
Yet while Indians have come to enjoy Pizza Hut's offerings, there are some parts
of the global brand that they do not want to change, such as air conditioning,
the quality of ingredients, and customer service. "There is a fine line between
making sure the brand doesn't lose its international heritage," says Kohli, and
ensuring that it suits local tastes. "We make no compromises on the global norm,
but make it familiar."
The best brands are confident enough to adapt without compromising their core st
rengths. When faced with a new technology or market, they can translate the valu
e proposition in meaningful ways that are consistent with both their heritage an
d their potential.
BIG CURRY MAC. McDonald's dispensed with its most prominent ingredient in order
to respect, and to please, its Indian customers. Many Indians eat no beef or por
k, or any meat at all. According to Vikram Bakshi, managing director of McDonald
's India North, it was necessary to adapt the company's offerings while keeping
the core brand values consistent across cultures.
"The menu has evolved over the years as a result of constant innovation and our
customers' needs," says Bakshi. "Local creations like McAloo Tikki Burger, Curry
Pans, Wraps Pizza McPuff, and McVeggie are established departures from what we
had in our introductory restaurant offerings.
"Today 70 percent of our menu is Indianized', and the McAloo Tikki burger is our
highest selling product. While the menu may be different in some ways, the McDon
ald's experience around the world is consistent, offering quality, great service
, cleanliness, and value."
Since drive-through service is not common in India, scooters and bicycle deliver
y services extend the concept of a quick, hot meal on the go in a way that is qu
intessentially Indian yet consistent with the global brand. It's still McDonalds
, and Indians love it. Think global. Be local.
iPhone came to India with a bang. That bang lasted only for the night of the lau
nch. Since its launch it has been weighed, tested and found wanting.
Here are the 7 reason why iPhone did not work in India.
Cost is too high for a phone which offers no new features except the touch scree
n. Priced at Rs31, 000 for 8GB and Rs36,100 for 16GB most of the phone buyers fe
lt it s not worth it.
There is no 3G network yet in India. Though the 3G auction process is complete a
nd the spectrum is allocated it takes a while for the service providers like Air
tel and Vodafone to roll 3G enabled services out. It could be in early 2009, whi
ch is a good 6 months away. So why pay for a service which cannot be used?
People are waiting for Nokia N96. Seriously, most of my colleagues have said tha
t Nokia N96 is a better phone and they will wait for it rather than going for iP
hone. Sure the iPhone s touch screen is good and its iPod music playing capability
is awesome but I would rather not spend my money for just that. I want more. Be
sides, the brand value of Nokia in India is pretty strong and Apple has to work
really hard to break that. iPhone did not give a compelling reason (other than t
he touch screen) for people to leave their N series phones.
Hygiene factors are missing. Many features which are a given in a phone that cos
ts you Rs4, 000 are missing in iPhone. I am not sure why they were but, video re
cording, cut paste, sms forwarding (how can you miss this) options are lacking.
Consumers are waiting for the price to drop. This has been the case for a while
now. I bought a 4GB iPod Nano for Rs.18, 000 in March 2006. I have checked backe
d into apple store after 6 months and for the same price they were selling 30GB
iPod video. It is an apples and apples comparison and they did not match. So, I
think apple will cut its prices and people are waiting for that.
Alternative routes to acquire the phone at a cheaper price. iPhone crazed are th
e people who mostly work with technology. They usually know what the going rate
of iPhone overseas is. So, it is not hard to get an iPhone 2G for $200 and unloc
k it for Rs. 1000 here in India. I am not sure if this route will work for 3G. S
ince there is no difference between 3G and 2G right now in India this would be a
steal. Even the rising dollar would not be a factor here.
Apple s monopoly did not go well with Indians. Apple has ingenuously designed prod
ucts and equally ingenuous monopoly. Indian consumers do not want contracts. The
y would like to change phones, change numbers whenever they want. They do not wa
nt to be married to a number and a phone. Besides, when you buy a phone at such
an exorbitant price, how can you justify the fact that you cannot change your ph
one for a different number or a different vendor? I am finding it hard to justif
y. Only Steve Jobs can answer that but until then Nokia might rule the roost.
iPhone in India has a long way to go. Unless the prices are slashed and apple ti
es up with other GSM service providers it might never take off. We just have to
wait and see if rolling of 3G services might give it a second life. A price of R
s. 20,000 would find more takers at least for the 8GB version.

Warren Buffet once said that when a manager with a great turnaround reputation e
ncounters a company with a reputation for dysfunction, it is the company that wi
ll keep its reputation.
So it was with some sadness that I saw Motorola bow to investor Carl Icahn's dem
ands that the company be split. Motorola Chairman Ed Zander dropped by the other
day and the best thing I can say was he was still a bit shellshocked. Here is t
he company that invented the cell phone in the fastest growing market in all of
technology getting clobbered.

So, sports fans, pick the reason that Motorola failed. Multiple answers are allo
wed.
1. Motorola missed the movement to 3G. Sure, it did but remember its biggest cus
tomers, the U.S. wireless carriers, didn't think they wanted 3G. So Motorola lis
tened to its customers, when they should have been listening to its customers' c
ustomers.
2. Motorola was a stodgy Midwest company in a fast paced Silicon Valley world. T
here is probably some truth in this. The Razr was an aberration a wild success.
It is hard to have a fashion business inside an industrial firm. Today Nokia is
moving into graphics-rich cell phone games while innovation from Motorol is givi
ng you RAZR-lite retreads in puke colors. Apple understands design; Motorola doe
sn't. Motorola's fashion sense only rivals New England Patriots' coach Bill Beli
chick's.
3. Motorola got out of the right business at the wrong time. Motorola at one tim
e owned lots of spectrum, which it traded for equity in Nextel. So it starts eve
ry year with zero sales while firms such as Qualcomm own intellectual property w
orth billions, and Verizon, AT&T and Sprint have millions of customers who will
pay them $500/year. Motorola turned down a chance years ago to buy both Qualcomm
and/or Nokia (for $20 million!).
4. Motorola just ran out of time. That's what every losing coach in history says
. Doesn't fly. Maybe it had the wrong management but running out of time was not
the problem. It did have a computer guy ( Zander) who had to learn the industry
, but that could have been bridged. After all, what did Steve Jobs know about ph
ones?
5. Motorola should have moved into content. This one might be true. Motorola led
in set top boxes and IPTV. It should have jumped all over Tivo/Slingshot. It ma
de a great acquisition with Symbol and it understood content, but didn't carry th
e day.
6. Motorola stopped innovating. True. Do you carry a BlackBerry? A smartphone? S
hould Motorola have been a platform company, like Google is moving to? The Razr
was the precursor to both the iPhone and the BlackBerry. By being late, it surre
ndered the high ground. It should have jumped on Palm. Plus, no one on the Motor
ola's senior management team ever sold a product to a consumer. It really doesn'
t sell licenses; it sells phones to teenage girls on Facebook.
7. Motorola didn't execute. Exactly so. Its customers the wireless carriers had
a hate-hate relationship with Motorola, which did not deliver what it promised i
t would. Motorola never drank its own Kool-Aid; they never built the "seamless m
obility" lifestyle among its various product groups. Can you see a way that cons
umers could have wanted to tie in their needs at home, at work, on their person
and their auto? Sure you can. But Motorola could never bring these warring tribe
s together inside the firm. Face it it communicated mainly by rumor
8. Motorola didn't grow. In the past, unhappy stockholders would just sell their
stock. Today, they moan and scream and force stupid actions. Motorola now has t
o go through gyrations which will make it easier for its competitors. Right now,
no one wants to buy this division so it will be spun off to the stockholders. T
his looks like a very tough business to run. Turning a company with a downward s
piral is the single hardest job in technology.
9. Motorola is a loose confederation of warring tribes. Of course it is. It is a
company of 66,000 employees. But the warring tribes never coalesced. This was t
he problem that Zander tried to fix. Too little, too late. Game over.
10. Motorola never had the sense of urgency. Could be true. Everyone else moves
at warp speed; Motorola jogged at its own pace, more like a monopolist than a pa
ranoid competitor.
One of the benefits of capitalism is that it kills off those that are slow to in
novate, slow to execute. But I feel somehow badly that the firm that invented ce
llular is now the walking wounded.