Chandramouli C S
Engagement Manager, Zinnov
In my last blog I talked about the potential for IT products in India and gave few examples about large product companies looking to tap the Indian market by localizing their product offerings. Things looked very bright for future and I was personally excited to see the day when products are “Made for India”
Zinnov worked on a benchmarking project to understand the product localization strategy of large MNC companies from 3 different domains. The domains we chose for the study was Semiconductor, Internet (Search, Web 2.0, and WebServices) and Enterprise Product companies (ERP, Databases). The results were not just astonishing, but opened up new dimension of localization strategy.
For most companies localization is about multi-language products or making the product lite on features. Seldom companies have realized the need to build scratch products focused on India consumers. Here are few snippets of the study, have categorized it based on domain for simplicity.
Internet companies: We studied 3 large internet companies who have their R&D captive centers in India; Only 2 of the three companies had a localization focus. India ranks 5th globally among the top internet users, Internet penetration is about 3.5% of total population. Number of Internet users has grown by 700% in the last 7 years and one of the fastest growing markets in Asia (Behind China and Japan)
For Internet companies the localization is simple and straight – Language and Content. For these companies doing multi Indian language support is localization. Having a India centric portal is one area where companies are working on, but needs lot of improvements. They have tried to customize few product offerings targeting Indian customers but it’s still very preliminary and has a long way to go.
My question to here is “How many of us read Hindi News online, Transact in Kannada Online”. In a country like China localization of language makes sense, but my guess is more than 80% of Indian Internet users are English speaking.
Enterprise Product: Looks like Enterprise product companies have their Product Managers on Job. Out of the 3 company’s studied, all the 4 companies had a strong India focus. With about ~ 235,000 SMB’s registered with registrar of companies and about 6 million establishments (one employee beside owner) India is definitely a great market to sell enterprise software.
One of the largest ERP makers has a clear SMB focus defined for India and has customized their product suite to the market requirement. They have stripped down the massive product into simple (Easy to Install, Easy to Use, Key functionalities) and cost effective solutions. Making less expensive “Lite robots out of heavy monster” is the goal. Multi-Language support is still being carried but unlike Internet companies that’s not the only focus.
I refrain from talking piracy in SMB market for now.
Semiconductor: The idea is clear and loud, “low cost chips for emerging markets”. Estimates say that Indian semiconductor market is about ~1 Billion USD in size, and is growing at 30%. With the huge potential and competition in consumer electronics & Mobile markets, chip makers are forced to keep the cost low. Zinnov looked into 4 companies in this vertical and all of them had a low cost chip design focus.
Based on the above analysis it’s clearly evident that most of the companies do not have a 360 degree localization strategy. To what I understand Product development is about identifying a need/problem which a customer may/may not know himself and finding best product solution to solve it. Most successful companies have done it earlier in matured markets and now feel that playing around the core product (Change language, a little content, reduce cost) is localization. I still haven’t seen a product entirely built from scratch for Indian customer needs.
After all we are different aren’t we?
Note: I have not talked about Desktop product companies here. With piracy level in India was close to 73 per cent compared to the worldwide average of 36 per cent and 23 per cent in the US and Canada there is a different strategy companies have to adopt in this area.