Impossible market shares start small, take time

Once in a while, hard-nosed businessmen dim the lights, go quiet and listen to a crooner gushing about "the impossible dream". Well, after a while, it boils down to the impossible market share, but hey, for a while back there they all got warm enough for someone in the audience to ask for the AC to be turned up.

At a swanky hotel here, that is now getting competition from IT companies, the Confederation of Indian Industry gathered its brethren to talk about innovation. At the centre of it was Erehwon, a consultancy dealing in "innovation consulting".

For a start, Erehwon reads "now here" backward, which the consultancy's boss assured the audience was not about delivering that humongous market share now and here. But, Narang talked about Varaprasad Reddy - he of the Hepatitis B vaccine fame.

How Reddy got there was one of the lessons needed for what innovation was all about, Narang said, for "we all agree that innovation is absolutely necessary".

It took Reddy seven years, instead of the two he angrily promised a cynical Californian scientist who refused him the technology. So, the lesson - innovation is not about mavericks but needs several people working together for extended periods of time to make things happen.

The hard-nosed part was added by Bhaskar Bhat, managing director of Titan Industries Limited. He spoke about how Titan took Tanishq jewellery from nowhere to Rs 534 crore in sales, which is 70 per cent of all branded jewellery sold in the country. "But that, is only two per cent of the Rs 65,000 crore worth of jewellery sold in India", he added.

So, Tanishq's six year journey yielded the following lessons for innovation. Jewellery can be sold in India by positioning it as an object of adornment rather than of investment.

The modern jewellery buyer is born and brought up in Patna but gets married into and/or works in Bangalore. "So the traditional bond between the local jeweller and customer is breaking on its own".

Tap into it, by offering quality, which in Tanishq's case was about offering purity of gold.

The company brought in karat meters and showed customers what they were getting, "for which they were willing to pay a premium," Bhat said. This worked because, the company estimated that of the "customer was being taken for a ride to the tune of 10 per cent, by 'underkaratage'".

Ten per cent of Rs 65,000 crore was Rs 6,500 crore, "so clearly there was a market for what we were doing, and you 'can' make money in jewellery without cheating."

In the long run, the idea was about being honest about gold, but getting the customer hooked onto diamonds, for that is where the big money was. Business innovation, then, was as important as innovating the product.