New Delhi: The Nano, the ultra-low-cost car from Tata Motors Ltd, is not the first Indian product testing the limits of frugality. Even benchmarked against its high standards of capital efficiency, the country has had its share of game-changing products and services that have not just altered the industry they are part of but also spawned an entire business ecosystem around them.
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There are several examples—ranging from the Rs500 cataract surgery at Aravind Eye Hospital in Madurai to the Rs20 McDonald’s burger—illustrating the power of products in ushering in price revolutions. But it is not often that such products have brought in epochal changes beyond the industry they operate in. Here are three examples of such game-changing products:
The sachet
When schoolteacher Chinni Krishnan made a career change to run a pharma company in the early 1970s, he had a simple business plan in mind: making medicines affordable to the common man. His factory in Cuddalore, Tamil Nadu, made medicines and healing salts packaged in 5g packets that were otherwise available in the markets in 100g packets.
Krishnan may not have known it then, but he laid the groundwork for the sachet concept, India’s biggest marketing revolution. Years later, in the late 1970s, his son C.K. Rajkumarextended the concept by introducing Velvette-branded shampoos in sachets at affordable price points (as low as Rs2) and creating an addressable market running into millions not touched by sales of the product in bottles. Rajkumar’s brother C.K. Ranganathan(present chairman and managing director of consumer products firm CavinKarePvt. Ltd) came up with a product, branded Chikshampoo, stretching the market size even further.
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“It was an immediate success of course, because it suddenly opened up the entire rural market for this one company,” said Ranganathan of his brother’s Vale Pharmaceutical Industries. “Today, everything that rural India consumes is available in sachets, from shampoo and detergent powder to gutka.”
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Such small-packaged products helped boost the presence of so-called fast moving consumer goods, or FMCG, in the hinterlands, increasing the distribution reach of makers of such goods. “Small packs have actually revolutionized the Indian FMCG market,” says Pradeep Lokhande, founder of Rural Relations Pvt. Ltd, a Pune-based marketing agency. “It does not only provide an advantage to the consumer, who finds it easy to carry and affordable, but also a small retailer who does not need too much space to keep them in the shop.”
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