Lessons from

the Maharaja Mac

by Lulu Raghavan
December 2007
Lessons from
the Maharaja Mac
Five rules for
entering the
Indian market
When McDonald’s replaced its beef-based
Big Mac with the mutton-based Maharaja Mac
in India, skeptics shook their heads. After all,
no one had ever successfully marketed a
burger made of anything other than beef.
But McDonald’s faced a dilemma: how to
sell hamburgers in a culture where the
cow is sacred.
As it turned out, the mutton burger was a
tremendous hit. In addition to the Maharaja Mac,
the company now sells cottage cheese wraps and
potato patties to its growing Hindu clientele. This
success has allowed McDonald’s to shape and
grow the Indian fast food market while capturing
a large slice of the growing pie.1
Like McDonald’s, most global companies have
found that building brands in India is no easy task.
They have had to significantly alter their global
strategies for the Indian market. Because the Indian
market and consumer differ significantly from the
rest of the world, the tried and tested approach of
2
Maharaja Mac
Lulu Raghavan
December 2007
Lulu Raghavan is client director for the
Mumbai office of Landor Associates.
© 2007 Landor Associates. All rights
reserved.
simply tweaking brand strategy at the regional
and country levels is doomed to fail.
A recent study by McKinsey suggests that
multinationals that have had the most success
in India have approached the market from a fresh
perspective, resisting the urge to simply transplant
what has worked elsewhere.2 They have been
willing to create local brand strategies from
scratch. Similarly, the Boston Consulting Group
has concluded that winners in India can be
separated from losers by their ability to recognise
India’s unique characteristics and align their
business models accordingly.3 1 Kishore Dash, “McDonald’s India,” Thunderbird School
of Global Management (2005), http://www.thunderbird.
edu/wwwfiles/pdf/about_thunderbird/case_series/
As corporate boardrooms around the planet a07050015.pdf (accessed 12 March 2007).
strive to craft brand strategies for the Indian
2 Kuldeep P. Jain, Nigel A. S. Manson, and Shirish Sankhe,
market, they would do well to draw on lessons
“The Right Passage to India,” McKinsey on Finance
learned by multinationals with many years of (Winter 2005), http://www.mckinseyquarterly.com/
experience in the country. These lessons provide article_abstract_visitor.aspx?ar=1581 (accessed
a basis for formulating and executing successful 12 March 2007).
branding strategies in a notoriously complex and
3 The Boston Consulting Group, “India: The Next Frontier
idiosyncratic market. for Consumer Companies” (2006), http://www.bcg.com/
publications/files/India_The_Next_Frontier_for_Consumer
_CompaniesJul06.pdf (accessed 12 March 2007).

Doing well in India depends
on a willingness to think
differently about all aspects
of the business.
Most multinationals that have built strong brands in
the country have been guided by a simple mantra:
“Think differently about your India strategy.” In
particular, they have been willing to completely
rethink issues around
• Brand investment
• Consumer focus
• Localization and innovation
• Market segmentation
• Regional diversity
In the following sections, I propose five rules for
maximizing branding success in India.
Rule 1:
Invest in your brand
To successfully build a brand in India, you will need
patience and a long-term view of the market. More
than in any other part of the world, you must be
prepared to invest time and money before your
company starts to see financial returns. Keep in
mind that Indian consumers like to do business
with companies that have been around for a while,
so you can’t just bring your brand to India and
expect to see profits from day one.
The Indian market is complicated, diverse, and
idiosyncratic. It takes time to understand Indian
consumers. It takes time to localize products. It
takes time to navigate through the red tape. It takes
time to acclimatize to the diversity and constant
contradictions that define India. Coca-Cola, for
example, has found the Indian market very tough
to crack. It reentered the country in the 1990s after
a 16-year absence and did not begin to turn a profit
until 2006.4
3
Maharaja Mac
Lulu Raghavan
December 2007
Korea’s LG Electronics seems to understand this
principle very well. Its corporate headquarters took
on the burden of expensive national advertising
campaigns for its Indian subsidiary to establish
its brand with Indian consumers. This investment
allowed LG to maintain price competitiveness
despite its massive advertising spends. The
company even invests in making its expatriate
managers feel comfortable at home in India.
Korean-speaking maids who can cook Korean
food are dispatched from Seoul to make adjusting
to India much easier for the Koreans, thereby
increasing their motivation and productivity.5
Rule 2:
Reach out to the consumer
Twenty years ago, Indian consumers had
a reputation for blindly accepting most imported
Western goods. But consumer behavior has
undergone major shifts since then, and it is
important to understand the uniqueness of
the Indian consumer today. They are extremely
value-for-money conscious and highly demanding.
They carefully consider features, functionality,
and service levels at all price points. Analyzing
market potential and brand awareness cannot
replace real-world consumer understanding and 4 Archna Shukla, “Cola Majors Bet on the Fizz in India,”
Livemint.com (9 April 2007), http://www.livemint.
firsthand experience. com/2007/04/09004954/Cola-majors-bet-on-the-fizz-in
.html (accessed 14 April 2007); and Jennifer Kaye,
Target Group Index (TGI) has compared brand “Coca-Cola India,” business case for Tuck School of
Business at Dartmouth (2004), http://mba.tuck.dartmouth
building in Brazil, Russia, India, and China. Its .edu/pdf/2004-1-0085.pdf  (accessed 14 April 2007).
surveys suggest that global advertisers can be
expected to “experience the widest divergence 5 Masanori Kondo, “Success of MNCs in India: Market
Research, Product Localization and Advertising,” Weekly
from international norms” in China and India.6 Economist (July 2006), http://www.nihongobashi.com/
Even so, these two rising economic powers are news/japanese-mncs-2.html (accessed 12 March 2007).
remarkably different consumer markets. Korea’s
Daewoo Motors, for example, tried to adapt its 6 TGI, “Brand Building in the BRICs,” http://www.tgisurveys
.com (accessed 15 April 2007).

China strategy to the Indian market. It failed
miserably because Indian consumers would not
accept products made to another’s standards.7
Hyundai Motors, in contrast, spent considerably
more time trying to understand its Indian custom-
ers. After determining that Indian consumers attach
significant importance to lifetime ownership costs
of a vehicle, Hyundai reduced the engine output of
its Santro to keep fuel efficiency high. It also priced
its spare parts reasonably and made more than
a dozen changes to product specifications tailored
to the Indian market. For example, they factored in
India’s less than optimum road conditions while
designing the car. As a result, the Santro has been
a runaway success with Indian consumers, selling
far better than other foreign brands that entered
the market with high repair rates and service costs.8
Rule 3:
Don’t just localize — innovate
In India, you cannot introduce a global product
and expect it to be successful at the local level.
Localization — the adaptation of a global strategy
to suit local market conditions — must embrace
innovation. This is true whether you are considering
product development, pricing, distribution, or
communications. A multinational company wishing
to do business in India must be willing to experi-
ment with new strategies. It must also be prepared
to walk away from strategies that have been
successful elsewhere.
Like Coca-Cola, Kellogg’s initially struggled when
it introduced its signature cornflakes to the Indian
market in the mid-1990s. The idea of a cold and
crispy breakfast was anathema to Indian women,
who were used to thinking of breakfast as hot, fresh,
and savory. When they could be persuaded to try
the cereal, they used hot milk and ended up with
bowls of soggy mush. So Kellogg’s changed its
strategy. It began to innovate. It developed wheat
and rice cereals as well as hot cereals with flavors
that appealed to the Indian palate. Sales began
to climb. By adapting to local cultural habits, the
Kellogg’s brand was able to succeed. In time, as
breakfast routines changed, the appetite for
cornflakes grew, too.9
4
Maharaja Mac
Lulu Raghavan
December 2007
When Pizza Hut started doing business in India,
most Indians were unfamiliar with traditional
Italian pizza toppings. But by offering pizza toppings
tailored to the Indian palate, and selling the product
at affordable prices, the company succeeded in
putting pizza on the table in India.10
Rule 4:
Choose your market segment carefully
Multinational companies frequently enter new
markets by targeting the top 10 percent of the
consuming class. These consumers tend to display
behaviors most convergent with their counterparts
in other countries. They are also usually the first
to try new products and brands.
Toyota, for example, was a well-known brand in
India before the company made its debut in the
country. The company correctly understood that
the budget and small car segments were already
too crowded and people had enough choices there.
Middle and upper segments were needed. The
company also realized that with the economic
boom and rising pay packets, many small car
owners would want to upgrade to a higher segment.
It therefore launched two products — the Corolla
and Camry — that targeted these middle and upper
segments. Both models have been successes.
However, Toyota’s success does not mean that you
should focus on just the upper end of the consum-
ing class. It is important not to lose relevance with 7 KPMG International, “Consumer Markets in India — The
the mass consuming class. Affordability is a large Next Big Thing?” (September 2005), http://www.kpmg.fi/
Binary.aspx?Section=156&Item=2249 (accessed
issue for lower- and middle-class consumers in 15 April 2007).
India, and they tend to be extremely price sensitive.
C.K. Prahlad noted in The Fortune at the Bottom 8 See note 2 above.
of the Pyramid that the latter category may be
9 Marc Gunther, “MTV’s Passage to India,” Fortune
a source of significant revenues and profits.11 (9 August 2004), http://money.cnn.com/magazines/
fortune/fortune_archive/2004/08/09/377904/index.htm
LG Electronics developed a successful (accessed 16 April 2007).
segmentation strategy with its line of televisions.
10 Niti Bhan and Brad Nemer, “Brand Magic in India,”
The company reengineered its TV product specs BusinessWeek (8 May 2006), http://www.businessweek
to appeal to middle and lower market segments. .com/innovate/content/may2006/id20060508_952455
These offerings included a no-frills television to .htm (accessed 14 April 2007).
expand the market at the low end and a premium
11 C.K. Prahlad, The Fortune at the Bottom of the Pyramid:
21-inch flat TV for the middle segment.12 Eradicating Poverty through Profits (Wharton School
Publishing, 2005).
12 See note 2 above.

Foreign companies that have
met with the most success
have taken the time needed
to understand the special
needs of the Indian consumer.
Meanwhile, McDonald’s tailored its product
portfolio to ensure relevance across socio-
economic consumer segments. Initially, the brand
was viewed as expensive and relevant to only the
upper classes in India. But by selling innovative
products at various price points, the company
ensured its relevance to mass segments.
Rule 5:
Anticipate regional and cultural diversity
India is an extremely diverse country. Nearly
two dozen official languages are spoken in India’s
28 states. Customs and economic development
vary enormously from state to state. The cities
are nothing like the countryside. Addressing the
separate and unique needs of this diverse
consumer base is a must. Shombit Sengupta, an
international management consultant, put it well
when he said, “Nobody can successfully do
business in India by reading its potential from
quantitative market reports. Understanding the
psychological, sociological, and historical back-
grounds is fundamental to hit the bull’s-eye.”13
Big box retailers Tesco, Wal-Mart, and Carrefour
have now made inroads into India, but some
observers are predicting that local retailers like
Pantaloon and Reliance will walk away with most
of the business. Armed with better local knowledge
and understanding of regional differences in
consumer behavior, the Indian brands may have
an insider’s advantage.
Multinationals wishing to do business in the country
might well take a lesson from Dabur, an Indian
consumer packaged goods company. Dabur has
adapted its national brand strategies for the South
5
Maharaja Mac
Lulu Raghavan
December 2007
Indian market. In these areas, Dabur has regional-
ized its national brand strategies, renaming brands
in local languages and localizing ad campaigns.
This approach has resulted in special products with
distinct local flavors — and considerable financial
success. Dabur’s sales jumped from 5.5 percent in
the first quarter of 2006 to 19 percent in the third
quarter ended December 31, 2006.14
Brand nirvana
If a foreign multinational expects to achieve
branding success in India, it must deviate from
any one-size-fits-all global branding strategies.
Doing well in India depends on a willingness to
think differently about all aspects of the business.
Success in India comes slowly, and only after
a considerable investment of time and money.
Foreign companies that have met with the most
success have taken the time needed to understand
the special needs of the Indian consumer.
Reaching out to the customer requires more than
localization; it also requires innovation. Meanwhile
market segmentation should be chosen carefully.
While it may be tempting to enter India focused on
the top consumer tier, the lower and middle classes
also constitute huge potential markets.
Just when you think you’ve got it all figured out,
you will need to come to grips with the vast regional 13 Edwin Colyer, “India: A Hot Business Climate?”
BusinessWeek (31 May 2006), http://www.businessweek
and cultural differences in the country. The good .com/innovate/content/may2006/id20060531_711820
news, however, is that if you are willing to follow .htm (accessed 15 April 2007).
the simple rules outlined here when developing
your Indian brand strategy, you will be well on your 14 “Dabur Set to Regionalise Brands,” Hindu Business Line
(7 February 2007), http://www.thehindubusinessline.
way to brand nirvana. ■ com/2007/02/08/stories/2007020805360500.htm
(accessed 12 March 2007).
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