Local and Global Brands Thrive Across Categories

Consumers spend more cautiously

Brands continued to thrive in India, despite slower economic expansion and greater consumer caution.

Indian brands proliferated and even dominated many categories, sometimes independently, as an entity of an Indian conglomerate, such as Tata Group, Reliance Industries and Bharti.

International hospitality brands Starbucks and Dunkin' Donuts opened their first Indian outlets, Starbucks in a joint venture with Tata, Dunkin' Donuts with India's Jubilant FoodWorks. They'll face local brands like Café Coffee Day and Barista.

With approval of foreign direct investment legislation, India's parliament eased market entry for global retailers. The major retail brands waited for further interpretation of the legislation's nuances before opening stores, however.

Several cross-category trends appealed to the value mentality of Indian consumers, including:

Social Media

Social media grew at a rapid pace, increasing the already extensive consumer exposure to brands.


In search of merchandise and bargains, consumers spent more time online, visiting eBay and Indian sites such as Jabong, Flip Card and Snapdeal, which represent a growing, if relatively small portion of sales.


By offering special deals during selected festivals, like Diwali, international brands met consumer value expectations while maintaining price integrity, a practice similar to sales during Western holidays or Chinese New Year.

Financial institutions add products

Banks and insurance companies introduced investment products for members of India's rising middle class. The participating brands included the state-owned Life Insurance Corporation (LIC) and ICICI, India's largest bank and the most valuable Indian brand in the BrandZ™ Top 100 Most Valuable Global Brands.

Private insurance brands such as Met Life, Aviva Life, Tata AIA and Max Life were aggressive and diversified with their sales and marketing approach. These brands marketed investment products, generally life insurance, usually with traditional advertising on TV, print and with telemarketing. Companies like LIC, mainly relied on large agent networks.

Aviva promoted products for parents to insure their children's education. Banks also encouraged cross-selling. The State Bank of India introduced a massive educational campaign about how to buy life insurance as an investment.

In addition, banks expanded into mobile banking, a major opportunity. With almost 900 million mobile phones in use, India is the world's second largest cellular market and many more people in India have mobile phones than have bank accounts. Using mobile for cash transactions is becoming important, especially in rural areas.

Telecoms and devices

Reflecting the general fragmentation of the Indian market, obtaining cell phone service requires two separate transactions. Consumers first buy a device from a retailer and then buy the SIM card from a telecom service provider.

Consumers shopped for smartphones at every price point and did not lack choice. The Indian brands included Micromax, Karbonn, and Spice Mobile. And many Chinese brands entered the market. To raise their brand profiles, Micromax and Karbonn sponsored events.

Consumers selected their telecom provider carefully because the industry was embroiled in a corruption scandal, with certain carriers charged with bribing officials to obtain licenses.

Popular brands among consumers included Idea and Docomo, which accrued credibility in part from being a Tata brand. Gaining advantage from their scale, Airtel, a Bharti brand, and the global brand Vodafone commanded a slight premium.

Retail opens slowly to international brands

Late in 2012, India's parliament approved foreign direct investment, another step in the long process of opening the country to foreign retail brands.

The legislators struggled to balance competing interests: the desire to stimulate the economy, improve infrastructure, and provide consumers with greater range and lower prices; and the need to satisfy the small business owners whose shops dominate India's highly fragmented retail sector.

The legislation permitted multi-brand retailers, such as Walmart, Tesco, Carrefour and Metro, to own 51 percent of retail joint ventures, but it also mandated that a certain amount of merchandise must be sourced locally.

The major global brands are well positioned to open stores in India because they already operate in the country as joint venture wholesalers. They did not rush to open retail stores, however, because the recent legislation is complicated and not necessarily the final word.

The legislation also made it easier for single-brand operators, like Ikea, to open stores without an Indian partner. Ikea has been trying to access the Indian market for years. The Indian government is reviewing Ikea's $2 billion investment proposal of opening 25 stores in India in the next 15 to 20 years.

Cars at all price points

Carmakers pursued sales potential at both ends of the market, offering small, low priced models for budget-constrained buyers and more premium options for the wealthy. But car sales did not meet expectations, according to the Society of Indian Automobile Manufacturers.

Maruti Suzuki led the entry-level segment. Renault introduced its Duster at an affordable price point. Tata continued to market its Nano, aimed mostly at drivers trading up from a two-wheel vehicle. Responding to the customer's need to feel pride of ownership, the Nano campaign focused on the car's features rather than its price. Nano also served as a second car for the more affluent.

BMW and other brands have introduced more stripped down versions of their cars in order to satisfy desire for the brand at more affordable price point. Chinese brands have entered the market, most notably the Foton, which is available as a sedan or a more premium hatchback.

Personal care

In personal care, India experienced several global category trends including: the popularity of anti-aging products, increased interest in men's grooming, and the movement to natural ingredients.

The market included a mix of both global and local brands. The men's grooming segment, for example, included Nivea and Hindustan Unilever's Fair and Lovely for Men, as well as Imami's Fair and Handsome.

BrandZ Top 100 2013

BrandZ Global 2013 Report Top 100 Report

Top 100 Chart

2013 BrandZ Top 100 Infographic

BrandZ 2013 Infographic

Methodology and valuation by Kantar Millward Brown

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