The recent decision of India’s parliament to allow 100 percent foreign ownership of companies in India is big news to many multinationals that have been dying to get in on the action in the world’s second most populous market, and the massive Coca-Cola Company is no exception. Indeed, with a full re-entry to the country it abandoned in the late 1970s, there’s essentially no corner of the world that will now be without the seemingly ubiquitous white-on-red script of the most successful soft drink in history. But one other major region has given Coke headaches since at least the early 1960s, and going there today one might be hard pressed to find the classic can for sale. Indeed, Coca-Cola has faced a number of challenges in the Middle East, but learning how to turn them into opportunities there could teach the soft drink giant some important lessons it will need for success in India.
A corporate strategy article by Thunderbird students.
Tata has their sights on global expansion, but can they replicate their domestic success in advanced markets? Tata’s recent success with Jaguar Land Rover (JLR) certainly is a start. Acquiring JLR during the global economic recession was a big risk for Tata. The acquisition strained Tata’s cash supply and required Tata to raise billions in debt to finance the purchase. Through a series of cost cutting measures, Tata led JLR to recovery which now contributes handsomely to Tata’s healthy profits. JLR gave Tata direct access to the luxury car market in developed countries like Europe and the U.S.
In parallel to Tata’s effort in advanced markets, Tata has historically aggressively penetrated markets similar to India, where they are more comfortable and experienced. By focusing its international expansion on countries with markets similar to India, Tata has been able to leverage its market expertise in these emerging markets.
By Alick Gordon, Arvind Deshmukh, Deviki Gupta, Sam Hung and Chul Won Baek
Like many young men his age, Rohan was a bit nervous about his first date with Neha. They had been friends for many years, but this was the first time they had been out on their own together. After ordering their food, the waitress responded with the ubiquitous question, “Would you like fries with that?” “Yes please,” responded Rohan before paying and carrying his and Neha’s trays of food back to their table.
Unlike in the United States, where most young adults would never think of going on a date to McDonald’s, in India it is a widely accepted and welcomed destination. McDonald’s India has carved a niche for itself in an increasingly competitive Indian fast food market by adapting itself in ways uncommon for the company in other parts of the globe. Through the company’s focus on teenagers and young adults as well as a highly specialized menu, McDonald’s has found success in India when many people said it could not be done.