Tactics in entrepreneurship: the Indian saga
India is a land of entrepreneurs. It runs in our blood. In fact. but for entrepreneurship of all kinds, our economy would just not move at all.
Right from serving food at very cheap prices for the poor in all towns and cities in mobile vans, to setting up huge shopping malls, we have it all. It is estimated that the service sector will create the maximum jobs. This is no wonder, as we have a very huge population.
For example, let us take one sector, that is, organized retail. We have been able to provide a huge number of jobs in this sector, and most employed in such establishments are often not even graduates. However, even the low wages paid in such establishments have helped to remove poverty in some small form or the other.
Be that as it may, we also have a huge mass of entrepreneurs who have made it big in the FMCG sector, in particular and continue to grow, by adopting good tactics aimed at reducing cost of the product or cost of distribution. However, the same entrepreneurs do high decibel advertising to keep the target group engaged in a big way. Hence the market for the product grows much faster than ever before.
A classic example of this concept of tactics in practice is the Chennai-based organization called Cavinkare. This organization is run by a highly enterprising entrepreneur, Mr C K Ranganathan. When he understood that there was a huge demand for smaller packets of shampoos, he launched a very famous brand called Chic shampoo, which is still the market leader in India, thanks to its rural penetration, , that even the mighty Hindustan Unilever has been unable to match.
Similarly, it has launched a hair dye called Indica, which spreads very fast and can be applied quite easily. The key message is that it one can wash one's head with shampoo, within just ten minutes. Cavinkare has acquired a famous brand of pickles called Ruchi and has grown the brand to greater heights. Cavinkare is a big advertiser on television and outdoor advertising as well. It has caught the imagination of the youth, and has a niche in each of its products.
Tactics would simply translate into very quick moves that one needs to make to fight competition, to penetrate new markets or quickly capture new market shares in areas where the huge companies may not be able to push their products. This is exactly what Cavinkare has done throughout. Its major customers are in small towns and rural areas.
Similarly, there is one soft drink that is found in rural Tamil Nsdu and in small towns that are often at least eighty kilometers from the nearest big city. This product is called Bovonto, which has a very unique taste of grapes. This soft drink is very unique, as it has captured the imagination of a big group of customers in smaller towns and rural areas, where it is a very fast growing brand of a small company called Kali Mark.
Make no mistake. Kali Mark is itself a company now touching one hundred and fifty crores in turnover, which is very small by multinational standards, but can still grow, as there is a market that will not accept any other product.
What Cavinkare and Kali Mark have proved is that tactics is required to understand unique customer tastes, and with each small innovation, there is growth in particular markets. A niche market is quite easily possible.
When he realized that there is a tremendous scope for branded footwear that can be compared with Bata, but should sell at lower prices, an entrepreneur from West Bengal, woke up, and built the Sree leather brand. Today, this brand is competing with Bata in a very big way. In Kolkatta, it is a house hold name. What makes it unique is that the quality is good, the range of footwear is also good, and the prices are very reasonable.
Tactics can also be seen in education. The Vellore Institute of Technology ( VIT), and the SRM group of Chennai, are outstanding examples. These two institutions are run by Visionaries who saw the need to invest very heavily in infrastructure, bring in the best of teacher, make students come out with innovative products even when they study, and give importance to research. The result is that these two institutions are clear market leaders with very good names as the country's two best deemed Universities. In fact, the service sector to cater to thousands of its students from all over the country, is growing so fast now.
There can be no better place to understand entrepreneurship, than to understand what happens to marketing of unbranded textile products in rural areas of Tamil Nadu. The mini buses that ply to several remote areas are the ones that help transform entrepreneurs into very intelligent marketing experts. They get a very accurate idea of what is needed by the rural population, and then deliver. For example, even ready made shirts and sarees are sold at very reasonable prices to rural households, in equated monthly installments.
It should be noted that tactics is totally different from Strategy. Tactics is integral to strategy but is less complicated. It is more applicable for quick moves, in situations where one has to act fast to corner market shares from big competitors at lower cost. It is not a substitute for strategy.
Strategy is a much larger idea, is always long term, and is centered around what the organization does to build an unique position for itself, in a very wide context, over a period of several years -- in over two decades, for example.
Tactics is here to stay in Indian entrepreneurship. As we go along, we are bound to see more of tactics in different forms. The more the better.
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