Book Review: Atul Joshi,Winning a Billion Consumers: A Disruptive Approach for Success in India

Dynamic and digital world economy with shrinking world boundaries and ever-demanding consumers with access to vast range of products and services has changed the rules of the game for corporate world. To survive in this competitive market, firms need to adopt efficient strategic plan by incorporating customer centric and innovative approach to increase their market share and retain it.

Atul Joshi’s Winning a Billion Consumers: A Disruptive Approach for Success in India highlights various aspects of customer empowerment by achieving efficiency, integrity, accountability in design and delivery of goods and services to create value addition for the end user. The author through his extensive research has tried to understand the role of Gram Power and technologies in inclusive consumption pattern. On the basis of his research, the author has developed a strong belief that the successful companies are not necessarily selling a different product or service in comparison to their competitors; they are simply selling it strategically. He believes the companies that treat the last mile as a transformative asset, by demonstrating their efficiency, customer understanding and supremacy in the more competitive, aggressive, brave new India are ‘Turbonators’. These Turbonator companies, a word derived from ‘turbine’, a 100-year-old scientific invention, have profitably channelled the enormous potential of a billion consumers for mutual benefit.

The author with his enriched experience views an enormous market that still remains unconnected to the products companies make, and only handful of businesses intimately understand consumers and consumption. He highlights that a disruptive approach can make businesses relevant to a larger set of people and unlock aspirations of a billion consumers, and can make success broad based, in a globalized competitive market. The external competitive market, globalization, digital revolution, innovation, customer expectations, highly elastic demand, cultural dynamics, marginal difference in the technological adoption by rival firms and equal access to resources by all pertinent competitors makes the last mile hardest to achieve, but it is also the most important. The author promotes that the distinction lies at the point where external factors to the company, the likes of the customers, clients, influencers, retailers and distribution converge with internal forces to the company, equivalently company people, processes and products, predominantly the arena of the last mile. The book is thematically divided into three parts: part one contains the case for seeing the last mile as a deterministic and crucial asset, and the impact it has on the fortunes of the company; part two highlights various strategies practiced by emerging market companies to analyze consumption pattern of heterogeneous and highly demanding and inexperienced generation Z consumers, and part three depicts importance of non-negotiable competencies to create a market position through incorporation of zero calorie value chain, optimum combination of men and technological incorporation.

Chapter 1, ‘Winning in a Billion Consumer Market’, of the book begins with the case of Amul, the idea of cooperatives which was conceived by Verghese Kurien in 1949 in a small town called Anand. The idea was nurtured and executed by Mr Kurien at the time when middlemen had monopoly on holding supply of milk, education and infrastructure was a huge challenge and people were disunited along caste and communal divides. The author has highlighted the success mantra of Amul by focusing on concurrent development and business execution with holistic approach of supply and demand, farmers and the customers and society and the market, it is not either or, it is both. A sense of trust and fair play is the key to effective and efficient execution of entire value chain. The author on the other side has highlighted the case of inefficient last mile value chain of Azadpur Mandi in Delhi, which still follows primitive way of executing deals in Mandi with no advancement in technology and management. The last mile involves multiple changes in hands (minimum seven times), by way of intermediaries, and piles up costs and inefficiencies, before reaching the end consumer. As a result, farmers get negligible price of its product and major share of profit goes in the pocket of middlemen. The author believes that companies can at the least dilute if not entirely eliminate losses in value transmission as their goods and services reach customers by using the last mile to educate and add value to all range of customers. The Turbonator companies are premium examples of having a winner product that appeals to mass segment. These companies are deeply aware of the profit architecture of their industry and have used their strengths in their mass market to sell their premium products to generate sustainable pools of customers and profits (the author has categorized these sustainable pools of profits as Revenue Turbine).

Chapter 2, ‘Cracking the Da Vinci Code’, tries to answer three basic questions: What makes the Indian consumer and consumption so unique? What different ways do successful companies currently employ to reach their goods and services in large, heterogeneous mass? And what last mile information is needed to make an impact in the Indian market? The chapter begins with the mention of mysterious and a controversial work by Dan Brown, The Da Vinci Code, with special reference to Leonardo Da Vinci who had planted different codes and symbols in his work, in particular in painting, The Last Supper. The author believes that, in a similar manner, large numbers of companies in India are still searching for protocols and motifs and trying to capture the might of opportunities to maximize India’s vast business potential. The author differentiates Indian consumers from other emerging economies consumers in terms of high savings because of cultural aspiration in every Indian to leave a legacy for their future generation and to secure their own future as well as most of the Indian consumers buy small, but frequently. In addition, Indians will stay young and energetic for years to come, the average age of Indian in 2020 will be 29, while the average age in both China and the US will be 37 and in Europe and Japan 45 and 48, respectively. He believes that the enormous challenge in India is in unlocking demand that has diversity within the opportunity that the country offers. The chapter further throws light on seven last mile models of distribution practised in today’s corporate world: True Billion Consumer model: focused on mass distribution of products; Inclusive Distribution model: touches rural and disenfranchised hinterlands effectively; Advocacy model: sells essentially to influencers and intermediaries rather than final points of sales; Direct to Consumer model: that leverages personal relationships rather than commercial establishments in the task of distribution; Value Creation model: that focuses buyer and seller as one entity with common objectives to create a new value curve; Sapience Sales Model: wherein the seller has deep subject-matter expertise, the buyer is savvy too and strategic commercial transaction is executed by the seller on the basis of their deep insights on the client’s business; and New Age model: that uses the vast power of digital and media capabilities of today to sell goods and services. In the end, the author has recommended four key variables that should form the foundation for the right last mile model. These four variables are the number of interface points, complexity of sales, contribution size and the imperative for value creation in the selling process.

In Chapter 3, ‘The Five Knots of the Last Mile’, the author takes reader to Shanghai, highlighting the transformation of Shanghai from muddy towpath with tall reeds to European style trading and financial houses, West-inspired colonial hotels, neon lights, giant television screens and an estimated 2 million visitors each day. The author wants to convey the impact of economic prosperity on material aspirations of the people. The author believes that only few companies consider India as a serious opportunity, many feel a billion is just a number of warm bodies, mostly without a wallet worth talking about. But the truth is that in every category, there is unexplored fortune. To explore the untapped market, the task of any business in India must be not only to serve demand but also to create one. Hence, companies in India need to focus on procreation and harnessing of the demand. He believes that the Indian shoppers are unseasoned, mostly new entrants to the consuming class; they need hand-holding to help them to make a choice and provide confidence that the promise made by the product will be kept. Every Turbonator company, irrespective of their domain category, has first grown the category by unshackling the demand. In the process, they improved their market position. The author proposes five knots of the last mile from market to non-users: first knot is ‘Entrenched route to market’: ability to see the large market in granular parts, and deploying a last mile solution apt to each typology; second knot is ‘Untrodden route to market’: where one forges new nodes of delivery, taking advantage of convergence in channels of distribution; third knot is ‘Leapfrog Consumption Barricades’: where one builds last mile capability to diffuse components that inhibit current consumption, it does not open new channels of distribution; fourth knot is ‘Disruptive Value Curves’: an alliance of the power of people and technology with whatever companies are doing has the force to deliver a holistic solution to the problems they face, and craft a new business model, beyond the mere alternation of some features in their products; and the fifth knot is ‘The Invisible Market’: is the conversion of non-users. The author concludes by quoting that it is not unusual to see companies work at multiple knots at the same point of time.

Chapter 4, ‘Sextant Arcs of Turbonators’, opens with a brief extract from a novel written in 1865, Alice in Wonderland written by Lewis Carroll, where Alice is confused which way to go; similarly, companies are confused to find the best path to market perforation. The author believes shepherding the company to one path versus another; in making this choice, the company stands pledged to its destiny reason being one can replace people, change products, buy the latest technology, but the differential path, once adopted, is generally difficult to reverse. The author has summarized Turbonator companies array of strategies to win in the market in terms of six sextant arcs, or paths, available to them: Surge Ahead: doing better what they do best, replicating the proven success formula with a machine-like consistency; Grow the Core: keeping the same core but enriching and fortifying the essence of the root proposition; Trim Sails: eliminating costs, processes and historical value chain; Go Upwind: by leveraging the four key ‘ bullish’ secular trends in the market, a compressed discovery process about brands by the Internet savvy young generation, increasing purchasing power, conspicuous consumerism and rapid urbanization; Go Unchartered into thus far exclusive and unequalled territories; and Escape Velocity: basically generate so much of market momentum that it decimates centrifugal force of gravity. According to the author, each path to success must meet a fivefold criterion for a company to invest in development: The Scale of the arc: must have a scale and profit pool to justify investment in people and distribution structures; The Growth potential of the arc: even if it is slow burn, the candle must burn bright in some time horizon; the ability to bestow Competitive position: it must be an arc wherein one can win and create a sustainable competitive advantage; The Realism of the arc: realism in pursuing opportunities comes when companies get into what is in synch with their vision and capabilities. It involves understanding of where an organization wants to go, but tempered with its capabilities and context of the market; and The Sustainability of the arc: sustainability is the net positive impact of what we do with society, people and their lives. Companies, categories and ways of doing things that endure the test of time are those that add value to the people they seek to serve.

In Chapter 5, ‘The Revenue Turbine’, the author has explained the importance of sustainable revenue performance of the company as the core trust parameter for their stakeholders. The author has thrown light on challenges faced by companies to get customers to part with their money because of non-users more in number than consumers, even those who consume are young and inexperienced with highly brand elastic demand; in addition, there is a recalibration of channel power. He proposes a precision machine, Revenue Turbine that goes through four steps of development, which is charged with the responsibility to deliver the company its strategy and to unseal the latent demand of a billion customers in the market. These four steps together make the last mile maturity model comprising of Amorphic with planning horizon of less than one year, growth for one year, performing up to three years and leading five-year plans with strong spotlight on current year performance. These stages are switch over from basic sales approach to sales practices with growth in category, procreate demand and convert non-users. The Revenue Turbine formulation comprises seven stages from designing the blueprint by benchmarking the current state, pinpoint market growth and structure by making opportunity matrix, grow market by neutralizing consumption blockades, constructing Five E-Model to differentiate the product and service through incorporation of empowered pricing, exceptional reason to buy, elucidation selling, ease of relationship and empathy, revamping the process efficiency in terms of predictability through efficient management of margin, credit, supply chain, technology, people processes and demand activation, develop right set of inquisition on the current state and the future and generate distinctly competitive construct.

Chapter 6, ‘Zero Calorie Value Chains, highlights importance of value-based pricing by quoting numerous examples from Just Around the Corner from London restaurant with fair price strategy, importance of number Nine in a human mind and Albrecht Diskont (ALDI) food retailer supermarket with low prices and superlative value generation for the customers. The author believes value is a trade-off between benefits and the cost of these benefits in the customer’s mind. Value-based pricing permits the company to pick up all the legitimate money it should when they sell their products. Hence, in this chapter, he tries to focus on expanding the market by right pitching the ‘Value’ of products and services; it does not necessarily, and only, imply frugal pricing. The author believes good value chain capability is the core reason for top three or four players having market share of three-fourths of the industry in almost every category in the market. He strongly believes customers are savvy to the value if it exists. They continually weigh price and performance, emotional connection and functional benefits in making buying decisions. Hence, synchronization of price and value in products and solutions can help to expand the market, endow a winning differentiator over competition, spur customers’ recommendations and improve profitability.

Chapter 7, ‘Customer Capital in the Times of the Millennial Generation’, opens with the case of acquisition of Hutchison Essar by Vodafone with a valuation of US$18.8 billion, highlighting the most competitive telecom industry with the finite electromagnetic spectrum being shared by innumerable fierce operators and motive of Vodafone extravagant deal for the quality of 22 million consumers and the future growth in an emerging country like India. Author believes that a business with an intrinsic capability to measure customer equity knows that upwards of 75 per cent of its balance sheet in a year is driven by customers already on the books of the company. But companies that do not measure the financial value of their existing customers will rarely bother too much about them. In such companies, customers are presumed to be passive recipients of service. According to the author, the last mile has been habitually seen as a one-way path, reason being with reach of product or service to an intermediary or a client, the role of company ceases to exit. Users become anonymous, the value chain hazy and control on customer experience gets fragile. It results in attrition of customers; this forces the company to focus even more on new acquisition and even a larger attention to the existing profitable customers. The author quotes, ‘A business like this is like a bucket that leaks. It has to be perpetually refilled.’ The chapter answers questions to the unique features of Indian customers, the appropriate currency measure to measure the value of existing customers and how a company can build customer valuation. The author has proposed seven-step Customer Capital Ladder, comprising of brands role from transaction to trust, from product to experience, from customers to consumption, from being difficult to make it easy, from why to how, from buyers to communities and from organization structure to organization culture. The chapter concludes with recommendations to companies to leapfrog from the old world but at lower costs, more equanimity and greater efficiency.

Chapter 8, ‘Man and Machine, Not Man or Machine’, highlights how technology empowers compression of the conventional concept of the business cycle that most companies have been used to be following: first big markets, then smaller, first rich, then not so rich. Embracing cutting-edge, solutions powered by the likes of cloud computing, data analytics, Internet, mobile technology and geospatial analysis help companies to leap frog to the next generation of growth. But limitations to the quantum of ‘leapfrogging’ possible in a country challenged with the basics in infrastructure and education is a big question. The other dilemma is how much should machines be really allowed to run our lives, even more in a billion people economy, given that these do cause job losses. The author proposes six technology levers at the last mile: shifting the market’s centre of gravity by improving access and enhancing opportunity; empowering the populace and drive sustainability; deploying the power of algorithms, building new markets; making growth more inclusive; delivering the customers’ quest for empowerment; and connecting with the last man at the farthest point.

Chapter 9, ‘Swarm Intelligence: The Execution Supremacy’, begins with the reference of Surat, a port city on the bank of river Tapi in Gujarat. The author highlights the transformation of Surat from an expensive and dirty city, with 37 per cent of it filled with sewage and almost 40 per cent of the people living in slums with no drainage facilities. Pneumonic plague led to widespread deaths and panic in the city but with the entry of S.R. Rao, the new commissioner of the municipality in Surat, within a few years later, the same city was voted as India’s second cleanest city by the Indian National Trust for Art and Cultural Heritage (INTACH), an independent government organization. Clean drinking water became a norm rather than a luxury for the few. Sewage treatment increased sixfold. Morbidity rate declined to 75 per cent. Municipal revenues had exponential increase, as compliance improved. The chapter in its simplest form highlights three basic questions for business transformation; where are you right now, where do you want to go, and how do you get there? He proposes Swarm intelligence as a collective intelligent behaviour of individuals that can solve complex issues, often even without a central command, despite a hundred billion neurons that have to function in a reasonably coordinated manner. The six-dimensional Swarm intelligence framework of ‘Turbonators’ analyzed by the author with Walk the Talk: AC to DC (slogan of S.R. Rao, i.e., a call to his officers to move from their air-conditioned offices to the execution of daily chores), followed by God’s in the details by breaking the complex whole into smaller, uncomplicated and straightforward parts, develop a growth mindset through persistence, effort, challenges, learning, inspiration, struggle and a clear vision of the future as the currency that constitutes the ‘growth’ mindset, open the third eye by focusing on long-term development of the asset and transform profit shares and build enduring equity for the brand, empire builders not conquerors by learning from the lead indicators more than lagging indicators, having a clear mind map of where the organization is headed as well as ability to choose apt themes in different business cycles and People contrast by focusing on input that make the output, minimize intrusion of personal biases and maintain current competitive leverage.

Chapter 10, ‘Epilogue’, is the consolidated overview of the book and the author through Epilogue highlights the importance of sustainable road map feasible for building the strategic and differentiating dimensions of the last mile. He believes companies need to institutionalize the entire process so that they will continue to grow their business and be meaningful to their customers in the future as well. Further he suggests companies should not lose sight of the long-term market they are likely to eventually get to. While the leaders of today have to have an eye on the future, and be generally trending in the right direction, they also need microscopic precision to execute agendas of the day. He believes the millennial generation, the economic growth of India, twenty-first-century urban Indian population, digitization and Internet proliferation and social commerce on the net are some game changers and are discernible in the market. The future is likely to belong to companies that can bring innovation to their products, markets, customer interface and value chains, and build the capability to translate thought into a value. The essential construct of the ‘Turbonator Companies’ of the future, with the millennial generation, large-scale, urbanization and a digital world as a backdrop, are likely to be critical requisite competencies. The ability to think like an architect and construct and reconstruct the business models over a short duration will be the key to secure the future. Technology development must necessarily consider both man and machine, improve productivity and enhance the quality of jobs people are doing. He recommends companies to have higher purpose in a consumer’s life in the first imperative for a business, the purpose of the business needs to be grounded in meaning and must make difference in the consumer’s life for it to resonate deeply. With younger generation taking command both as employees and customers, and with rapidly moving India’s median age of population of 25 years, customer centricity and speed to market is a prerequisite condition for sustainability. The three values that can hold steady for the next phase of the turbonation are being value biased, customer biased and action biased.

The book is a must for professionals professing in theory and practice of business in India. It serves as an academic guide and a reference guide to students of MBA, Executive MBA, Industrialists, entrepreneurs, educators and practitioners.