Flowing society

PRODUCT AND BRAND MANAGEMENT ASSIGNMENT

Flowing SocietyDrivers and Trends in Indian Context

2012

Submitted By: Group 5

Apoorva Sharma

Chandni Goel

Deepika Misra

Garima Dhamija

Neha Bhutani

I N F I N I T Y B U S I N E S S S C H O O L

Introduction

The current scenario witnesses the world in a constant state of flux. This gives rise to a macro force that defines our society in a distinct characteristic fashion.

It is evident that there is a peculiar movement of capital, information, people, technology, images, symbols etc. This has lead to integration of technological and communication platforms. Thus, creating a coliseum for free exchange of social, cultural and economic ideas and beliefs between people from various parts of the world. This sharing helps in creating a global community and a ‘Flowing Society’.

As a result, there is transformation of old institutions thereby paving the way for evolving common standards, preferences, patterns and codes.

Brands use this opportunity to leverage their respective competences in order to earn a greater share of consumers by offering innovative products and services that are more suited for a global culture.

Since, this society of flows creates a global consumer market hence, the aggregate basket of goods and services converts itself in the form of a homogeneous mixture of offerings.

This report critically examines the crucial relationship between the various drivers operating in a flowing society and the trends that are created as a product of these drivers.

This critical analysis of the drivers and trends at work is done keeping an Indian context in mind therefore, understanding the macro force that defines the current state of the Indian society.

Drivers and Trends

Trend 1: New Global Elite

Driver: De-territorialisation of the identities

This trend is characterised by an emerging class of new global elite who is a product

of the society of flows. The new global elite possess a peculiar characteristic of

increased mobility. This increase in mobility has caused a free flow of capital and its

owners beyond the previously limiting geographical boundaries.

Cases in Indian Context

India has witnessed the emergence of this trend in the recent past. Cellular

technologies like 3G connections and mobile applications have provided the new

urban Indian with excessive mobility and multitasking abilities.

1. Mobile Apps 1.1. The value of the Indian value added services industry, which includes mobile

apps, was estimated at $3.4bn (£2.2bn) in 2011.

Source:Deloitte.

1.2. The mobile application industry in India alone is predicted to top $4bn by the

year 2015.

Source:Asia Pacific Research Group (APRG).

1.3. One in three of the country's urban internet users have accessed a mobile

phone application.

Source:IMRB

Examples:

• Zomato.com has an app if you are looking to dine out.

• Amity university was one of the first universities to come out with a

dedicated app for its students.

• Booking movie tickets has never been easier because of the

bookmyshow.com app.

• Various leading banks have apps for mobile banking.

2. Integrated Technology

Integrated technological platforms like mobile banking and mobile commerce

facilities have enabled the new global elite to conduct business on the go.

Examples:

• Airtel Money: M-commerce

• Vodafone Mobile Money Critical Analysis Increasing integration of technological platforms have caused De - territorialisation of

identities. This has provided the new global elite with an increased mobility. Facilities

like mobile banking, M-commerce offer an opportunity for business on the go. This

facilitates increased mobility of capital and its owners.

Mobile applications like pay your bills, book tickets etc. help carry out the daily tasks

from a remote location. Consequently, the new trend has seen decreasing

geographical limitations and the capital is not bound by territorial boundaries.

As a result, there is dissociation of everyday tasks like work, shopping, leisure,

education etc. from the spatial proximity to centers where such tasks were

conventionally carried out.

Trend 2: Worldwide Availability of Goods and Information

Driver: Accessibility to Communication Channels and Expansion of

Information Networks This trend is characterized by an increasingly global consumers’ market and

decreasing geographical limitations in procuring goods and services. The basket of

goods and services has become fairly homogenous across regions and nations. Cases in Indian Context India saw the emergence of this trend with the entrance of multinational brands

offering products and services previously unavailable to Indian consumers. On one

hand there is availability of international brands in India while on the other hand a

boost in online retail has created a platform for acquiring products from other

countries.

1. Online Retail 1.1. Online shopping in India has touched a growth rate of 18 per cent and is only

likely to grow further.

Source:comScore Inc

1.2. Nearly 60 per cent of netizens in India visit a retail site monthly and the

number of online shoppers has grown by 18 per cent over the previous year.

Source:comScore Inc

Examples:

• Amazon.com

• Ebay.com

Two of the major global online retailers recently started shipping products to India.

2. International Brands

2.1. Ever since the Government permitted FDI in single brand retail, India has

seen a plethora of international brands entering the market. However, the

trend accelerated in the last 5 years.

2.2. The luxury retail market in India is growing currently at a compounded annual

growth of 25%.

Source: AT Kearny

Examples:

• Fashion brands: Louis Vuitton, Gucci, Salvatore Ferragamo, Diesel, Chicco,

Zara, etc.

• Cosmetics: Mac, Lancôme, L’Oreal, Colour Bar, etc.

• Automobile: Porsche, Audi, BMW, Jaguar, etc.

• Food & Beverage: International liquors, chocolates, etc.

3. International Product Launch

This trend witnesses multinational companies launching new products with

simultaneous world roll outs.

Examples:

• Apple i-pad 3: Apple launched its third generation i-pad in March 2012 with a

simultaneous international launch in key markets and a world roll out within

days of the launch.

Critical Analysis

This trend manifests itself in two ways. First, there is increasing entrance of

international brands in the Indian market. This makes the physical availability of

goods and services possible in the domestic market.

Second, the emergence of online retail enables customers to purchase products

produced in other countries. This enables the development of a global consumer

market extending beyond the geographical proximity.

As a result, creating a more or less homogenous mix of goods and services across

nations thus, reducing differences between the local markets.

Trend 3: People Flows

Driver: Movements and Networks

A Flowing Society is peculiarly characterized with a trend of People Flows. There is

increased movement of people across countries. This results in a growing number of

people with friends and family in different parts of the world. This greatly enables

information and cultural exchange.


In the last couple of years, India has seen a growing number of outbound tourists. In

addition, the country has also experienced a rising number of visitors in the form of

tourists and NRIs. This has created a platform for exchange of social and cultural

ideas thus exposing the Indian population to western lifestyles.

1. Travelers 1.1. 12.5 million Indians travelled abroad in 2010.

Source: PATA

1.2. India will account for 50-million outbound travelers by 2020.

Source: World Tourism Organization

1.3. Foreign tourist arrivals (FTAs) in India in 2011 are pegged at 6.29 million.

Source: Ministry of Tourism, Government of India

Examples:

• American Express: Introduced travelers’ cheques by leveraging their

expertise in cash management to take advantage of increased travelling.

• Visa and Master Cards: Offer global shopping convenience.

• Matrix: Introduced calling cards for inexpensive international roaming and

Matrix Forex cards for a cashless travelling.

2. Transnational Lifestyles 2.1. People flows cause information exchange thereby exposing people to

cultures and lifestyles of other countries.

2.2. This results in changing demands of the customers and creating a more

global culture.

Examples:

• Barista and Costa Coffee: The rising café culture in India has been

borrowed from the western trend of cafes serving freshly brewed coffees

around street corners.

• L’Opera Patisserie:The concept has been borrowed from the French culture.

• Geoffery’s: Based on the concept of English pubs.

Critical Analysis

Movements and Networks drives a trend characterized by constant movements. The

flow of people facilitates exchange of cultural, social and organizational ideas and

information. This translates into export of transnational lifestyles.

As a result, there is a growing demand for products and services relevant to these

lifestyle experiences. Exposure to foreign cultures also makes consumers more

accepting towards goods and services that lend such western lifestyles.

In addition, movement of people across nations creates a bridge for transfer of

knowledge that may be used for various business purposes.

Trend 4: More Energy Needed


A flowing society is a dynamically changing society with constant movements. Hence

there is a pressing need for greater energy to fuel the capacity of working and

keeping pace with a rapidly changing society. This trend manifests itself in two ways

– firstly, individuals in a flowing society require more energy to perform multiple tasks

and cope with rapid changes. Secondly, the macro-energy needs of the society

witness a rapid increase.


Over the last few years India has been evolving at a rather accelerated pace. This

immensely dynamic society and increased mobility demands greater energy in order

for people to be able to maintain pace with life in the fast lane.

1. Food On The Go 1.1. Sales at fast food chains in India are growing at approximately 28 per cent

per annum.

Source: PricewaterhouseCoopers (PWC)

1.2. Consumer expenditure on fast food is pegged at $400 million.

Source: Euromonitor

Examples:

• McDonalds

• KFC

• Subway

Fast food chains offer an opportunity for quick satisfaction of hunger on the go and

snacking in between meals. This ensures an increased consumption of food to meet

the growing energy requirements of people.

2. Energy Supplements 2.1. In order to keep pace with the rapid multi dimensional lifestyle consumers

take the aid of energy drinks and bars for instant energy.

2.2. 78% urban youth in India consume energy supplements on a daily basis.

Source: ASSOCHAM

2.3. Energy drinks consumption is projected at 20-22 million cans in India in 2012.

Source: rediff.com (http://www.rediff.com/money/2006/may/24drink.htm)

Examples:

• Red Bull: Its consumption is marked at approximately 5 lakh cans a month

and it has a 95% market share in India.

• Gatorade

• Cloud 9

• Burn

• Power Horse

• Horlicks Nutribar

• Rite Bite Nutritional bar

3. Macro Energy Needs 3.1. 2009, India was the fourth largest energy consumer in the world.

3.2. Oil/Fuel Consumption: India consumes 3.2 million barrels per day (bbl/d)

in 2010.

Source: Oil & Gas Journal

3.3. India’s oil imports exceed 2.2 million barrels per day.

Source: Ministry of Petroleum & Natural Gas, Govt. of India

3.4. India imported 280 million tons of crude oil in 2011.

3.5. Growth trend of Fuel Consumption in India at CAGR 6%.

Source: Ministry of Petroleum & Natural Gas, Govt. of India

3.6. High speed Diesel accounted for 41% (max) share of total domestic

production of petroleum products. 3.7. Power Consumption: Overall energy consumption is increasing at CAGR

6.98%

3.8. The increase in electricity consumption from 2010 to 2011 has been 13.34%

3.9. Domestic consumption of electricity is growing at CAGR 9.67%

Source: Ministry of Power, Govt. of India

Examples:

• Automobile Companies: Increasingly launching diesel and CNG/LPG

variants to meet consumer demand generated due to high petrol prices.

Hyundai Verna Diesel variant.

• Larsen & Toubro: Offers technology and infrastructure for electrical power

generation and oil refineries.

• Inverters: Luminous, Su-kam, Microtek etc.

• Autonomous Bodies: Organizations like Bureau of Energy Efficiency and

Energy Star provide energy ratings to electrical appliances to certify their

energy utilization efficiency.

• Electrical Appliances: LG, Samsung, Whirlpool etc. launched 5 star rated

appliances like air conditioners, refrigerators etc. offering higher energy

efficiency.

• Phillips: Offers CFL lighting which is power efficient.

• Power Saving devices: For instance companies like Power Saver India, ES

Electronics India Pvt. Ltd. etc. have developed energy saving devices.

Critical Analysis

A flowing society causes increased mobility and constant motion. This results in a

growing demand for more energy in order to sustain the dynamic pace of a rapidly

changing society. This has implications in both biological need for energy as well as

macro energy needs. As a result, Fast food chains and energy supplement brands

find this opportunity to leverage their expertise to provide consumers a chance of

enhancing their performance at work. At the same time brands develop energy or

fuel efficient variants of their products.

Trend 5: Transnational Families


This trend is characterized with an increased migration of people abroad in search of

better opportunities. While on one hand there is excessive relocation of talent and

workforce, their families are left behind creating a paradoxical unity fueled by the

increased geographical distance between family members.


India has been a victim to excessive brain drain over the last decade. Lack of

opportunities and uncontrollably rising population has caused growing migration of

the Indian talent pool to foreign countries.

1. Courier Services 1.1. Currently stands at INR 71 billion and growing at approximately 20% per

annum.

1.2. Contributes more that INR 10 billion towards Government revenues per year.

1.3. International express cargo holds 6% of the express cargo industry, but is

forecasted to reach 40% by 2017.

Source: Euromonitor

Examples:

• DHL

• UPS

• FedEx

• TNT

2. Money Transfer Services 2.1. Indians living and working abroad usually send money back home.

2.2. Over 20 million Indian immigrants send home approx. over $ 20 Billion per

annum. Source: Aite Group, Research and advisory body

Examples:

• Western Union Money Transfer: Market leader

• Money Gram

Critical Analysis

A flowing society offers excessive mobilisation to its inhabitants. Lack of

opportunities in the native country and a desire to increase their income motivates

the citizens to migrate to foreign countries for jobs.

While on one hand it results in depletion of talent pool and productive work force in

the native country, on the other hand it also becomes a source or foreign exchange

revenues in the form of worker remittances received from abroad because these

immigrants send home money and consignments to their families.

Due to this transfer of currency and gifts, the families find a binding unity even

though there is a huge geographical distance. This creates the phenomenon often

known as Transnational Families.

Trend 6: Massive Migrations

Driver: Economic, Cultural and Social Interdependence

In addition to migration abroad, a flowing society also witnesses the migration of

rural population to urban areas. This trend is characterised by ever expanding city

boundaries and intercultural segregation.


India has been witness to an ever increasing relocation of rural population to urban

areas. The cities of India are bursting with diverse populations thus resulting in

expansion of suburban areas on the outskirts of theses urban cities.

1. Migration

1.1. From 2001 to 2011, 22 million people migrated from rural areas to urban

cities.

Source: Census of India, 2011

Examples:

• Construction companies: DLF, Jaypee Greens, Arihant Superstructures Ltd.

etc. These builders and developers take this opportunity of ever expanding

urban population to develop the suburbs and offer residential properties.

• FMCG brands: Clinic plus, Colgate, Parle G biscuits, etc. Keeping in mind the

diverse populations that are now residing the urban regions due to migration

from villages, FMCG brands are increasingly attempting to make smaller and

more economical SKUs available to these consumers. For instance,

introduction of Shampoo sachets.

Critical Analysis

The increased mobility in a flowing society manifests itself not only in the form of

citizens migrating abroad but, also in the form of rural populations migrating to urban

areas in search of better opportunities.

This causes a high degree of pressure on cities as there is a lack of space and

resources to satisfy the exploding urban population. This trend creates a multicultural

diversity thus making the cities a melting pot for diverse cultural and social ideologies

leading to complex multi ethnicity exchanges.

Trend 7: Multilanguage

Driver: Blurring World and Movements & Networks

A society of flows is characterized by multiplicity of languages. Both the society and

the languages used in the society are dynamic in nature and constantly keep

evolving from generation to generation.

Cases in Indian Context India is a unique nation with its diversity distinctly reflected through its various

languages. However, recently, India has also been a hub for various foreign

languages with a number of training institutes opening up to offer their academic

services.

1. Diverse Languages 1.1. India has 22 official languages and 398 living languages and dialects.

Source: Ministry of Culture and Tourism, Government of India

1.2. In addition foreign languages such as French, Spanish, Mandarin etc are also

becoming popular in India.

1.3. India requires close to 1.6 lakh foreign language professionals as the market

for language sensitive work stands at about $14.4 billion.

Source: Nasscom-McKinsey report

Examples:

• Alliance Francaise: French is the most popular foreign language in India.

Alliance Francaise is the market leader in certified French courses and

currently operates more than 15 centers at various locations.

• School of Language, Jawaharlal Nehru University, Delhi: Offers multiple

degree programs in foreign languages and is one of the premier academic

institutions for higher studies in foreign languages.

2. Media Content 2.1. The content of Indian media has also been affected by this multiplicity of

languages.

2.2. 53% of newspapers and magazines publications in India are in regional

languages, 34% in Hindi and 13% in English.

Source: HT Mint

Examples:

Print Media:

• Big brands like Times of India and Hindustan Times are using this

multiplicity of languages to their advantage by publishing newspapers in

regional languages.

• Navbharat Times

• Dainik Jagran

• Punjab Kesari

Television Channels:

• Discovery Channel: offers its content in English, Hindi and some regional

languages.

• NDTV: offers news channels in both Hindi and English.

• Star or Zee Network: Regional language channels are now available all over

the country contrary to the scenario a few years back when they were

available in specific regions.

Advertising:

• Garnier: airs advertisements dubbed in both Hindi and English.

• L’Oreal: makes advertisements in both Hindi and English.

3. Use of Slangs and Symbols from Other Cultures 3.1. Brand in India have increasingly been using slangs, mixtures of languages

and references from western cultures.

3.2. Hinglish has become the lingua franca of the new Indian youth.

Examples:

• Dominos: The tag line, “Hungry Kya?” makes use of a mixture of English and

Hindi to appeal to conventional youth audiences.

• Dominos 3 Cheese Pizza advertisement: In its advertisement “Signs”,

Dominos uses a western reference for to portray God.

Refer: http://www.youtube.com/watch?v=1clPGZJSXa0

Critical Analysis

A society of flows has a peculiar feature of multiplicity of languages. Since, a flowing

society offers excessive mobility and multiple communication platforms hence, the

people of such a society observe dynamically changing languages.

Due to increased exposure to other cultures and free exchange of transnational

socio-cultural ideas, the people in such a society are exposed to idioms, symbols

and slangs from other parts of the world.

http://www.youtube.com/watch?v=1clPGZJSXa0

http://www.youtube.com/watch?v=1clPGZJSXa0

Conclusion

The Indian society in its current state demonstrates all the trends that characterize a Flowing Society. There is an increased mobility of capital, people, information, technology etc. in the Indian society.

This has given rise to a new class of people who are not limited by the geographical boundaries and are participating in the daily national life of a rapidly changing country.

There is growing exposure to cultures from other parts of the world which manifests itself in a rising demand for products and services that offer a transnational lifestyle to the modern Indian.

Therefore, India is a society of flows in its true glory, waiting to completely blend in the global culture yet retain its unique identity.

Flowing society

Education

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