The Indian customer has evolved quite a bit over the recent years, so much so that international security companies find the place more and more attractive. But there are still fears about the whole idea of entering the Indian market as it’s massive, diverse and, to a very large extent, fragmented.
The Indian customer has evolved quite a bit over the recent years, so much so that international security companies find the place more and more attractive. But there are still fears about the whole idea of entering the Indian market as it’s massive, diverse and, to a very large extent, fragmented. I am not going to say that these fears are misplaced. No, they are very much valid. But the potential returns on investing in this country are extremely high now. Hence it is important that you find a method to the madness.
What Does the Indian Customer Want?
First, let’s see what the Indian customer requires at the moment. According to Ashish Dhakan, MD and CEO of Prama
Hikvision India, analog systems were the popular preference for a very long time in India. But that is beginning to change now as integrated solutions and the Internet of Things (IoT) have created a need for IP-based video surveillance, access control, intrusion detection and perimeter security systems in various verticals.
Ashish Dhakan,
MD and CEO,
Prama Hikvision India
"The Indian market remains an enigma due to its multi-layered structure, huge scale, socioeconomic diversity, emerging vertical markets and myriad customized requirements compared to other developed countries,” Dhakan said. “India is one of the fastest growing markets for security products and solutions across the globe. The Indian security market is currently moving towards a mature stage. In the coming years, India’s security market will experience a boom like never before. The government’s smart and safe city initiatives are creating new opportunities for the security industry.”
A primary aspect of change is a shift from using security products for the sake of compliance to using them because of a better understanding of their benefits. Sudhindra Holla, Sales Director for India and SAARC at
Axis Communications, gave an example.
“For example, large IT companies, around five years back, just installed view/monitor/record system for purposes like forensic matters,” Holla said. “But now they are getting integrated with access control, face recognition and other similar solutions. The focus is on employees’ and women’s safety. When you look at manufacturers and retailers, people are moving beyond surveillance to business intelligence with solutions like people counting, loss prevention and even heat maps. There is also an emphasis on solutions that would help optimize the stores, to ensure that the right stocks are available in the right stores.”
There are changes in the government sector too. For instance, the police are looking at solutions to monitor traffic. License plate recognition has become a standard to monitor traffic violations and other relevant matters. In fact, analytics, in general, is on the rise. Much has been talked about the possibility of analytics on the edge making an impact in the Indian market, given the infrastructural limits here. Now the solution can be seen deployed in the field.
Sudhindra Holla,
Sales Director, India and SAARC
Axis Communications
Speaking of technical requirements, Holla added that customers are moving on from image quality, reliability and forensic-grade video to technologies like thermal imaging systems. Perimeter protection is becoming a major challenge, especially for entities like large manufacturers, power plants and other critical infrastructure. For such sites, knowing something is out there is often more important than what is out there, to take the right action.
These thoughts from two of the top security companies in the country should give you a brief idea on how the market is poised at the moment. But for many foreign manufacturers, a major fear is the idea that Indian customers are extremely price-sensitive. This is a reality, unfortunately, and companies must face it.
Dealing With Price Sensitivity in Indian Market
Dhakan agrees that the Indian market has a very peculiar nature as far as intense price competition is concerned. Here, price becomes a single major deciding factor in consumer behavior. A major reason for this is the large number of options available that makes customers treat products like commodities. A solution focused approach is required to negotiate the best deal in the security projects.
"In large-sized projects, customers (end users) focus more on solution part rather than price,” Dhakan said. “The best way to handle is by creating a compelling value proposition with focus on solutions and benefits. The latter may catch a customer’s eye, but individuals who are truly price-sensitive are much more enticed by the tangible benefits of the product. So, the value proposition needs to sell benefits, not speak of how you’re a price leader in your industry. If we are able to sell benefits well, then pricing will speak for itself.”
To help customers make more informed decisions that are not just based on price, companies can provide real-world examples (application cases), he added. A similar thought was echoed by Holla as he pointed out that they tend to make the customers aware of the need to go beyond price. Presenting the bigger picture of expenditure that the customer might incur is something that Axis focuses on.
For instance, repairing a PTZ camera that is installed at a public place could cost quite a significant amount. This means, unless the product is guaranteed to function without hitches, the cost of repairing it each time could be more than that of the camera itself.
Language and Cultural Barriers
India has 22 official and hundreds of unofficial languages. This means foreign companies must be prepared to meet the varied language requirements in different parts of the country.
“In the Indian market, language plays a key role in influencing the customers,” Dhakan said. “In metro cities, businesses are conducted mostly in English. Hindi becomes a predominant part of the business conversation in the North and Central India. In the southern, western and eastern parts of India, regional languages along with English help to engage the customers.”
Localized marketing is extremely important in this regard and foreign manufacturers should ensure that they have representatives in every nook and corner of the country. Some of the SIs we talked to stressed on this point as they explained that quick technical support is critical to them.
In short, understanding the changing requirements in the country, knowing how to deal with price sensitivity, and overcoming language barriers are some of the key factors that international manufacturers need to consider when entering the Indian market. With the right approach and investment, India can be one of the most lucrative options for you.