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Neha Kaushik

THERE was a time when technology and design were the preserve of the Japanese. The scene has changed very much, certainly in India. The genesis of this change dates back to the early and mid-1990s, soon after the economy was liberalised. At the time, both the Indian consumer electronics and automotive sectors offered little to the consumer in terms of novelty and were dominated by a few Indian brands.

The Koreans were, however, quick to see opportunity, despite the negligible brand recall which their products had in India at the time. And while other multinationals, including the Japanese, were wary of pumping in large investments in the market, the Koreans put money in the Indian market not only in manufacturing but also in brand building. According to market data, the three big Korean firms (Samsung, LG Electronics and Hyundai, the first of which entered in 1995) have already invested more than Rs 4,000 crore in India, and there is more in the pipeline to develop India as an export hub for their products.

The Korean gamble seems to have paid off. If one were to take the combined turnover of these firms, it would be close to a staggering Rs 14,000 crore. According to Mr K. R. Kim, Managing Director of LG Electronics India, which entered the country in 1997, "Certainly, we were keen on investing in India when other players were still sceptical about entering the Indian turf. Recognising the untapped potential of the Indian market, we came to the country with latest technology and introduced the latest products that were launched globally."

Agrees Mr Ravi Shankar, Senior Vice-President (Stakeholder Management), TNS India. "The Government eased all norms for entry into the car segment in the mid-90s. However, having burnt their fingers once, the Japanese trudged slowly. The Koreans (both Hyundai and Daewoo) nevertheless made headway, while the Japanese (not including Maruti Suzuki) watched and made a cautious re-entry later with Toyota being the only serious player, which again forayed into the market through a joint venture with the Kirloskars. Mitsubishi is carefully operating the second time around trying to make good with a tie-up with Hindustan Motors," Mr Shankar said.

But more than just by bringing in the latest products, the Koreans managed to reach out to the Indian consumer by launching products with the right design, pricing and image.

In fact, the ascendance of the Korean companies in the consumer mind-space is happening not only in India, but is a worldwide phenomenon. For instance, LG, which used to sell earlier as Lucky Goldstar, repositioned itself as an upmarket brand with an increased focus on R&D and marketing. The strategy in India for the Koreans is not only to provide new technologies and design in the premium-end of the market, but also to launch "differentiated" products for the mass segment.

Mr C. H. Yoon, Managing Director of Samsung India, said: "We have not only tried to bring in our latest technology, contemporary products for the Indian consumers, but even customised the products to meet the needs of our customers. We are following a market-oriented, India-specific strategy and a consistent approach to meet our objectives for the Indian market." Similarly, Hyundai's portfolio too spans from the small car Santro to premium cars and sports utility vehicles such as the Sonata and Terracan. In addition to addressing the requirements of the mass segment, another area where the Koreans have scored over their Japanese and European counterparts is on the marketing front. Points out a brand consultant working with an automobile company, "The Koreans did not take their brand equity for granted and have invested liberally on building their brand. In fact to connect with the local customer, their advertising is supported by the two national obsessions — cricket and films."

But market watchers point out that more than the numbers achieved, the success of the Korean companies has managed to do something even more fundamentally important — that of establishing an upmarket image for Korea in product quality and technical prowess. Mr Sharma says, "The success of the Korean products has changed the perception of Korea as a downmarket manufacturing hub." Though other firms too are beginning to spruce up their Indian operations by launching volume-spinning models and aggressive marketing strategies, there is a lot of catching up to do with the Koreans in the Indian market. Meanwhile, with more Korean multinationals such as Lotte Confectionary set to stride into India, surely it is Korean high tide.

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